Snohomish County, Washington

Comprehensive Annual Financial Report For The Year Ended December 31, 2017

Dave Somers Snohomish County Executive

Nathan Kennedy, CPA Director of Finance

Sharyl L. Raines, CPA Controller

Snohomish County Finance Department 3000 Rockefeller Ave. MS 610 Everett, WA 98201 (425) 388-3401

2017 Table of Contents

Page INTRODUCTORY SECTION

Letter of Transmittal ...... i Certificate of Achievement for Excellence in Financial Reporting ...... vii Organizational Chart ...... viii Elected Officials ...... ix

FINANCIAL SECTION

Independent Auditor’s Report ...... 1 Management’s Discussion & Analysis (MD&A) ...... 4 Basic Financial Statements Government-wide Financial Statements Statement of Net Position ...... 17 Statement of Activities ...... 19 Fund Financial Statements - Governmental Funds Balance Sheet - Governmental Funds ...... 20 Reconciliation of Governmental Funds Balance Sheet to the Statement of Net Position ...... 21 Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds ...... 22 Reconciliation of Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Statement of Activities ...... 23 Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - General Fund ...... 24 Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - County Roads Fund ...... 27 Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - Human Services Fund ...... 28 Fund Financial Statements - Proprietary Funds Statement of Net Position - Proprietary Funds ...... 30 Statement of Revenues, Expenses, and Changes in Net Position - Proprietary Funds ...... 32 Statement of Cash Flows - Proprietary Funds ...... 33 Fund Financial Statements - Fiduciary Funds Statement of Net Position - Fiduciary Funds ...... 34 Statement of Changes in Net Position - Fiduciary Funds ...... 35 Notes to the Financial Statements Note 1 Summary of Significant Accounting Policies ...... 36 1.A Reporting Entity ...... 36 1.B Measurement Focus, Basis of Accounting, and Financial Statement Presentation ...... 37 1.C Assets, Deferred Outflows, Liabilities, Deferred Inflows, and Equity ...... 41 Note 2 Stewardship, Compliance, and Accountability ...... 45 2.A Budgetary Data ...... 45 2.B Deficit Fund Equity ...... 46 Note 3 Detail Notes on Transaction Classes/Accounts ...... 46 3.A Deposits and Investments ...... 46 3.B Taxes Receivable...... 50 3.C Other Receivables ...... 53 3.D Capital Assets ...... 53 3.E Short-Term Debt ...... 55 3.F Long-Term Debt ...... 55 3.G Compensated Absences ...... 59 3.H Accrued Liabilities ...... 60 3.I Interfund Balances and Transfers ...... 60 3.J Governmental Fund Balance ...... 62 Note 4 Other Notes ...... 63 4.A Pension Plans and Other Benefit Plans ...... 63 4.B Risk Management ...... 79 4.C Commitments, Contingencies, and Legal Matters ...... 81 2017 Table of Contents

Note 5 Reconciliation of Government-Wide and Fund Financial Statements ...... 85 5.A Explanation of Differences between the Governmental Fund Balance Sheet and the Government-Wide Statement of Net Position ...... 85 5.B Explanation of Differences between Governmental Fund Operating Statements and the Statement of Activities ...... 87 Note 6 Pollution Remediation Obligations ...... 88 Note 7 Related Party Transactions ...... 88 Note 8 Tax Abatements ...... 88 Required Supplementary Information Schedule of Proportionate Share of the Collective Net Pension Liability ...... 90 Schedule of Employer Contributions ...... 91 Schedule of Funding Progress - Other Postemployment Benefits Plan ...... 92 Notes to the Required Supplementary Information ...... 93 Combining Financial Statements and Schedules Governmental Funds Combining Balance Sheet - Other Governmental Funds ...... 94 Combining Statement of Revenues, Expenditures, and Changes in Fund Balance - Other Governmental Funds ...... 101 Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - Other Governmental Funds ...... 108 Proprietary Funds Combining Statement of Net Position - Internal Service Funds ...... 123 Combining Statement of Revenues, Expenses, and Changes in Net Position - Internal Service Funds...... 125 Combining Statement of Cash Flows - Internal Service Funds ...... 127 Component Units Combining Statement of Net Position - Component Units ...... 129 Combining Statement of Activities - Component Units ...... 130 Fiduciary Funds Combining Statement of Changes in Assets and Liabilities - Fiduciary Funds ...... 133

STATISTICAL SECTION

Net Position by Component ...... 139 Fund Balances of Governmental Funds ...... 140 Changes in Net Position ...... 141 Changes in Fund Balances of Governmental Funds ...... 143 Assessed Value and Estimated Actual Value of Taxable Property ...... 144 Direct and Overlapping Property Tax Rates ...... 145 Principal Property Tax Payers ...... 146 Property Tax Levies and Collections ...... 147 Ratios of Outstanding Debt by Type ...... 148 Ratios of Net General Bonded Debt Outstanding ...... 149 Direct and Overlapping Governmental Activities Debt ...... 150 Legal Debt Margin Information ...... 151 Demographic and Economic Statistics ...... 152 Principal Employers ...... 153 Full-time Equivalent County Government Employees by Function ...... 154 Operating Indicators and Capital Assets by Function ...... 155

COMPLIANCE SECTION

Schedule of Expenditures of Federal Awards ...... 156 Schedule of State Financial Assistance ...... 164

Snohomish County, Washington

Introductory Section

Snohomish County Finance

3000 Rockefeller Ave., M/S 610 Everett, WA 98201-4046 (425) 388-3401 www.snoco.org

Dave Somers County Executive June 27, 2018

County Executive Dave Somers, Members of the Snohomish County Council, and Snohomish County Residents

I am pleased to transmit to you the Comprehensive Annual Financial Report (CAFR) of Snohomish County, Washington for the year ended December 31, 2017. The governmental financial reporting model provides a clear picture of the County as a single, unified entity, and also provides traditional fund-based financial statements. The two perspectives, government- wide and fund statements, enhance the County’s accountability to its financial statement users by providing a basis for comparison and the ability to assess long-term impacts of near-term financing decisions.

The CAFR consists of management’s representations concerning the finances of the County. Consequently, management assumes full responsibility for the completeness and reliability of the information presented in this report. To provide a reasonable basis for making these representations, County management has established a comprehensive internal control framework that is designed both to protect the government’s assets from loss, theft or misuse and to compile sufficient reliable information for the preparation of the County’s financial statements in conformity with GAAP. Because the cost of internal controls should not outweigh their benefits, the County’s comprehensive framework of internal controls is designed to provide reasonable, rather than absolute, assurance that the financial statements will be free from material misstatement.

The County’s financial statements have been audited by the Washington State Auditor’s Office. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessing the accounting principles used and significant estimates made by management; and evaluating the overall financial statement presentation. Based on the results of these audit procedures, the auditor issued an unmodified (“clean”) audit opinion. A copy of the auditor’s opinion letter is presented at the beginning of the “Financial Section” of this report.

The independent audit of the financial statements of the County was part of a broader, federally mandated “Single Audit” designed to meet the special needs of federal grantor agencies. The standards governing Single Audit engagements require the independent auditor to report not only on the fair presentation of the financial statements, but also on the audited government’s internal controls and compliance with legal requirements as related to the administration of federal awards. That report will be issued separately and available upon request no later than September 30, 2018.

i The CAFR contains four major sections: Introductory, Financial, Statistical and Compliance. The Introductory Section is designed to provide basic background information about the County. The Financial Section includes “Management’s Discussion and Analysis” (MD&A), the financial statements, the notes to the financial statements, required supplementary information, and combining financial statements. The MD&A provides a narrative analysis of financial condition and operating results; it should be read in conjunction with this letter of transmittal. The Statistical Section provides economic and financial data for the last ten years. The Compliance Section includes schedules of expenditures of federal and state awards (grants).

County Profile

Snohomish County is located on Puget Sound, between Skagit County to the north and King County (and Seattle) to the south. Covering 2,090 square miles, it is geographically the 13th largest county in Washington. The County is the third most populous in the state with an estimated population of 801,633 in 2017, and continues to be one of the fastest growing. Topography varies from saltwater beaches, rolling hills and rich river bottom farmlands in the west to dense forest and alpine wilderness in the mountainous east.

Snohomish County operates under a Home Rule Charter, which was adopted by a vote of citizens in 1979 and amended through the charter review process in January of 1997, 2007 and 2017. Independently elected administrative officials include the County Executive, the Prosecuting Attorney, the Sheriff, the Auditor, the Clerk, the Treasurer, and the Assessor who are elected at- large. A five-member County Council, elected by district, constitutes the legislative body. Elected officials serve four-year terms, council elections are staggered.

Snohomish County provides many services on a countywide basis and some services only to unincorporated areas. Within appropriate jurisdictions, the County provides road construction and maintenance, law enforcement, criminal prosecution and indigent defense, superior and district court services, criminal detention and correction, tax assessment and collections, planning and community development services, elections and recordings, inquests, and an array of human services. In addition, the County owns and operates an airport and industrial park, fairgrounds, various park and recreation areas including a golf course, a solid waste disposal facility, and a data processing center.

The Snohomish County Treasurer acts as the ex-officio treasurer for most special purpose districts of Snohomish County. Monies received from or for the special purpose districts are deposited in a centralized bank account. The County Treasurer invests or disburses moneys pursuant to instructions of the respective special purpose district’s governing body or administrative officers.

Most funds in this report pertain to the entity of Snohomish County. Certain agency funds pertain to the County’s custodianship of assets belonging to independent governments and special purpose districts. Component units included in this report are the Pilchuck Development Corporation and the Snohomish County Public Facilities District. The County also participates in the Snohomish County Emergency Radio Systems (SERS) joint venture.

The annual budget serves as the foundation for the County’s financial planning and expenditure control. The Council is required to adopt a final budget prior to the start of the ensuing fiscal year and prior to the expenditure of any County funds. Budgetary controls are maintained to ensure compliance with legal provisions embodied in the annual appropriated budget. With the exception

ii of funds that are anticipated to have no expenditures, funds specifically excluded by state statute and construction funds, which receive project-life budget authority through plans and systems ordinances, activities of all County funds are included in the annual budget process. A budget increase or decrease to a fund must be authorized by the County Council via ordinance.

Local Economy

Economic conditions have a direct impact on the County’s revenues and the demand for County services. Therefore the information presented in the financial statements is perhaps best understood when it is considered from the broader perspective of the specific economic environment within which the County operates.

The County’s economy is an urban-rural mix. Technology and aerospace manufacturing predominate in the southern and western regions of the County. The Boeing Company’s largest manufacturing facility is located in that area. Many of the company’s supply chain partners are also located within the County. In the past few years, those partners have diversified and expanded their customer bases to include Airbus, shipbuilders, defense contractors and energy generation customers among others. In the northern and eastern regions of the County, agriculture and forest products remain relatively strong.

A deep water port facility located within Snohomish County and the County’s regional airport facility both continue to plan for expansion. Each facility serves as an economic development tool for the region by providing lease space to new and growing businesses. Together they provide the capacity to import and export virtually anything from or to anywhere in the world, which places the County in a strong competitive position for global markets. In addition to their ability to attract global business markets, both facilities also provide significant recreational opportunities to the local community and beyond. The deep water port located in the City of Everett is the largest recreational marina on the US West Coast.

Snohomish County has benefitted from the significant economic and population growth in Western Washington over the last decade and has been among the fastest growing counties in the State. As Seattle and King County, directly to the south, run out of developable land, business and residential growth in Snohomish County is expected to continue.

Although Snohomish County’s largest employment sector (manufacturing) has been declining in terms of absolute number of jobs primarily due to productivity efficiencies, other industries continue to grow and expand their employment bases. Year-to-year growth was observed in most major industry sectors, despite the net declines in manufacturing. The largest gains were observed in construction and services. Boeing is by far the largest employer within Snohomish County, with over 30,000 employees. The company currently has a significant backlog of orders, which results in an expectation that the company’s local level of employment will remain relatively stable over the next several years. The local economy continues to diversify into technology, telecommunications, and health care. Snohomish County’s unemployment rate of 3.8 percent as of March 2018 is 0.3% higher than March 2017’s unemployment rate of 3.5%, which demonstrates virtually no change.

Property tax revenues tend to be stable. They are based on the prior year’s levy amount with optional increases of up to one percent, plus property tax on the value of new construction. Property taxes are levied primarily on real property owned by individuals and businesses. In accordance with the Washington State Constitution and state law, property taxes paid by a property owner are determined by a taxing district’s rate applied to the value of a given property.

iii In the County, the total property tax levy varies based on the make-up of the various taxing districts that include cities, school districts, fire districts, other special purpose districts and the county-wide levy. The Snohomish County Assessor determines the fair market value of properties, which is intended to reflect 100 percent of the property’s market value.

Economic projections created by external sources and utilized by the County assume continued growth in real estate sales for 2018. Real estate prices continued to climb throughout 2017 with the Case-Shiller Home Price Index up approximately 12.7 percent year over year. Total assessed valuation (TAV) grew by 9.3 percent in 2017 and there are positive signs for continued growth in 2018 and beyond.

Long-Term Financial Planning

The County is committed to maintaining a strong general fund balance and has a track record of making the hard decisions necessary to do so. During the 2018 budgetary process, the County Executive and the County Council built and adopted the 2018 budget to add to fund balance to add liquidity now and to build reserves to address any potential revenue shortfalls associated with any future economic downturns.

Per requirements of County code, the general fund’s fund balance level is measured as a percentage of prior year revenue (excluding transfers received by the general fund from other County funds). At the end of 2017 the County's total general fund balance was $32.9 million, or approximately 14.42 percent of 2016 revenues (excluding transfers received by the general fund from other County funds) higher than 2016 general fund balance to prior year’s revenues of 12.20 percent. Building the general fund’s fund balance continues to be a high priority of all county officials.

Similar to other Washington jurisdictions, the County will continue to face challenges meeting the demands for services. To ensure quality services are provided to the community, it is recognized that it will be incumbent on county officials to prioritize the services most important to the community.

Financial Policies

The County's financial policies and practices are considered "strong", which indicates that practices are solid, well embedded, and likely sustainable.

The County utilizes an internal five year plan for tracking current and projected General Fund revenues and expenditures. The plan is regularly updated and utilized by management as a decision making tool.

As required by County Charter and State law, the County annually prepares a six-year Capital Improvement Program (CIP) plan. The document provides discussion and analysis of issues (including costs) related to public facilities necessary for development under the Growth Management Act (GMA) as well as other public facilities and services that are provided by the County but not “necessary for development” (non-GMA facilities). Contents of the document are used when setting budget priorities.

The County is self-insured for a wide-range of loss exposures including property, liability and worker’s compensation. The County manages risk through a variety of methods including

iv insurance, loss prevention, loss control and comprehensive safety programs. As a result there is a county-wide cooperative effort to control losses and reduce costs.

Major Initiatives

The primary objectives of all major county initiatives are to serve the public and protect our quality of life. County leadership strives to seek innovative solutions to meet those objectives by focusing on public safety, the opioid epidemic, government reform, fiscal sustainability, wise stewardship of resources, and economic prosperity. In 2017 the objectives of governing officials in the County were to take a measured and thoughtful approach to controlling costs while maintaining a high level of services for our community. By identifying priorities intended to spur future economic growth and build a sustainable governance model, Snohomish County is today moving into position to make the most of the steady growth currently being experienced regionally and prepare for when the growth inevitably slows. Following is information regarding several of the highest 2017 priority initiatives:

Public Safety. Public safety is the highest priority of county government. In the 2018 budget the County not only maintained service levels but also added five new deputies. The County partially activated the emergency response system to address the opioid epidemic and established a first- of-its-kind Multi-Agency Response Group. The County in conjunction with other Snohomish County local governments and first responder agencies is developing plans on how to replace the aging Snohomish County Emergency Radio System SERS. This investment not only helps protect the current citizens of Snohomish County but future citizens too. Addressing this issue will be critical in maintaining the level of public safety services citizens enjoy.

Opioid Epidemic Response. Snohomish County, not unlike all other counties and cities across the country, is attempting to address the ever growing opioid epidemic. In response to that epidemic County Executive Dave Somers has partially activated the County’s emergency management system and initiated a Multi-Agency Coordination Group involving various county departments, the Sheriff’s Office, and the Health District. Through this multi-agency coordination and more focused efforts, we all hope we can turn the tide on this multi-faceted problem of addiction, mental health challenges and homelessness.

Service-Technology-Excellence-Program (STEP). A key component of reshaping how County business gets done is through the County’s Service-Technology-Excellence-Program (STEP) Initiative. Primarily, the STEP initiative is an effort to incorporate LEAN continuous improvement principles into county processes. The STEP initiative will develop and provide tools to continually increase both effectiveness and efficiency of the services offered, resulting in system-wide change, improved service delivery, and better employee morale. Change will be implemented in internal service departments and front line services that all citizens enjoy. STEP will help empower employees to reduce waste and solve problems.

Fiscal Sustainability. Maintaining financial discipline is another key component to giving the County the flexibility to respond to longstanding and emerging challenges. To that end, the County Executive has directed that the County look for long-term solutions to long term fiscal challenges. The County has been preparing for the next downturn by strategically building its fund balances. The County has avoided increasing service levels without additional revenues. Finally, these efforts have been performed collaboratively with stakeholders and elected officials to build broad support to maintain fiscal sustainability.

v Economic Development. The last but not the least of the County Executive’s top priorities is to ensure the economic prosperity of our region. The County Executive in 2016 launched an Economic Development Initiative, establishing sector leads in areas of historic leadership and emerging opportunity. This structure engages with industry leaders to collaborate on policies and strategies to advance targeted sectors for economic development opportunity. The primary focus of the sector teams is on driving economic growth and job creation. The sectors focus strategically on the development and implementation of strategies and action plans to promote growth in key industry sectors. One important cross-industry and multi-sector priority is manufacturing, since this is an area of particular strength and promise for Snohomish County.

The Economic Development Initiative strengthens and grows our region through industry sector strategies focused on: facilitating collaborative public private partnerships, promoting a thriving economic climate, and developing the workforce to meet industry needs.

One of Snohomish County’s biggest economic wins of late has been the expansion of Paine Field Airport to offer commercial service. Alaska, United and Southwest Airlines will be offering regular flights out of Paine Field beginning in late 2018, contingent upon the completion of a passenger terminal and federal regulatory approvals.

Acknowledgements

A financial report of this nature is not possible without the coordinated efforts of the staff from the Financial Operations Division of the Finance Department, the Treasurer’s Office, and other departments with staff that process financial transactions or otherwise contribute to the information presented in this report. We greatly appreciate the efforts of all involved. Further appreciation is extended to the Executive and County Council for their interest in and support of the County’s accounting and financial functions.

I will be happy to respond to any questions or comments about the information contained in this report.

Sincerely,

Nathan D. Kennedy, CPA Finance Director

vi vii Snohomish County Organizational Chart

Voters of Snohomish County

Legislative Branch Executive Branch Judicial Branch County Council County Executive Terry Ryan, Dave Somers Council Chair Brian Sullivan, Vice Chair District Court Superior Court Sam Low Presiding Judge Deputy Executive Juvenile Services Ken Klein Beth Fraser Marcia Isenberg Stephanie Wright Presiding Judge Chief of Staff Linda C. Krese Director Chief of Staff Eric Parks Lauren Bjurstrom Stephen Clifton (Interim) Executive Directors Susan Neely Administrator Cascade Division Kendee Yamaguchi Marilyn J. Finsen Hearings Judge Kristen Olbrechts Administration Boundary Review Board Board of Equalization Commissioner Superior Court Rick Leo Peter Camp Judge Thomas J. Wynne Judge Anita L. Farris Performance Auditor Judge George N. Bowden Everett Division Council Judge Ellen J. Fair Judge Tam T. Bui Judge Michael T. Downes Judge Anthony E. Howard Judge Eric Z. Lucas Administrative Departments and Offices Judge David A. Kurtz Judge Bruce I. Weiss Judge George F. B. Appel Evergreen Division Assessor Airport Human Services Judge Joseph P. Wilson Judge Steven Clough Linda Hjelle Arif Ghouse Mary Jane Judge Richard T. Okrent Judge Patricia Lyon Brell-Vujovic Judge Janice E. Ellis Judge Marybeth Dingledy Auditor Emergency Judge Millie M. Judge South Division Carolyn Weikel Management Facilities Mgmt. Judge Jeffrey D. Goodwin Jason Biermann Mark Thunberg Judge Beth A. Fraser Court Commissioners Judge Douglas J. Fair Clerk Lester H. Stewart Sonya Kraski Medical Examiner Jacalyn D. Brudvick Parks and Rec Daniel Selove, M.D. Tracy G. Waggoner Tom Teigen Susan C. Gaer Prosecuting Lee B. Tinney Attorney Finance Mark Roe Nathan Kennedy Planning and Dev’t. Services Barb Mock Ombudsman Sheriff Jill McKinnie Ty Trenary Human Resources Annie Cole Public Defense Treasurer Sara Bhagat Kirke Sievers

Blue box indicates elected position Information Public Works Technology Steve Thomsen Trever Esko

viii 2017 Elected Officials

COUNTY EXECUTIVE Dave Somers

COUNTY COUNCIL Ken Klein District 1 Brian Sullivan District 2 Stephanie Wright District 3 Terry Ryan District 4 Sam Low District 5

ELECTED OFFICE Linda Hjelle Assessor Carolyn Weikel Auditor Sonya Kraski Clerk Mark Roe Prosecuting Attorney Ty Trenary Sheriff Kirke Sievers Treasurer

SUPERIOR COURT JUDGES George F.B. Appel Millie M. Judge George N. Bowden David A. Kurtz Marybeth Dingledy Eric Z. Lucas Michael T. Downes Richard T Okrent Janice E. Ellis Bruce I. Weiss Ellen J. Fair Joseph P. Wilson Anita L. Farris Thomas J. Wynne

DISTRICT COURT JUDGES Kristen Olbrechts Cascade District Court Anthony E. Howard Everett District Court Tam T. Bui Everett District Court Steven M. Clough Evergreen District Court Patricia L. Lyon Evergreen District Court Jeffrey D. Goodwin South District Court Beth Fraser South District Court Douglas J. Fair South District Court

ix

Snohomish County, Washington Financial Section

Office of the Washington State Auditor Pat McCarthy

INDEPENDENT AUDITOR’S REPORT ON FINANCIAL STATEMENTS

June 27, 2018

County Council and Executive Snohomish County Everett, Washington

REPORT ON THE FINANCIAL STATEMENTS We have audited the accompanying financial statements of the governmental activities, the business- type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of Snohomish County, Washington, as of and for the year ended December 31, 2017, and the related notes to the financial statements, which collectively comprise the County’s basic financial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We 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

Insurance Building, P.O. Box 40021  Olympia, Washington 98504-0021  (360) 902-0370  [email protected] 1 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 County’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 County’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.

Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of Snohomish County, as of December 31, 2017, and the respective changes in financial position and cash flows thereof, and the respective budgetary comparison for the General, County Roads and Human Services funds 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 and required supplementary information listed in the table of contents be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

2 Supplementary and Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the County’s basic financial statements. The combining financial statements and schedules are presented for the purposes of additional analysis and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. This information has been subjected to 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 financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole.

Our audit was conducted for the sole purpose of forming opinions on the financial statements that collectively comprise the County’s basic financial statements as a whole. The Introductory and Statistical Sections and the Schedule of State Financial Assistance is presented for purposes of additional analysis and is not a required part of the basic financial statements of the County. Such information 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 it.

OTHER REPORTING REQUIRED BY GOVERNMENT AUDITING STANDARDS In accordance with Government Auditing Standards, we will also issue our report dated June 27, 2018, on our consideration of the County’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. That report will be issued under separate cover in the County’s Single Audit Report. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the County’s internal control over financial reporting and compliance.

Sincerely,

Pat McCarthy State Auditor Olympia, WA

3 Snohomish County, Washington - MD&A For the Year Ended December 31, 2017

Our discussion and analysis of Snohomish County’s financial performance provides an overview of the County’s financial activities for the year ended December 31, 2017. Please read it in conjunction with the transmittal letter at the front of this report, the County’s financial statements and the notes to the financial statements, which follow.

FINANCIAL HIGHLIGHTS

• As of December 31, 2017, total assets plus deferred outflows of resources of the County exceeded total liabilities plus deferred inflows of resources by $1.4 billion (net position). Nearly $1.3 billion, or 91.9%, of this amount is net investment in capital assets.

• In 2017, the County’s total net position increased by 5.7% or $76.1 million from the prior year. The governmental net position increased by 5.5% or $59.1 million from the prior year. The business type net position increased 7% or $17.1 million.

• As of December 31, 2017, the County’s governmental funds reported combined ending fund balances of $267 million. Approximately 11.2% or $29.8 million is unassigned and available for spending at the government’s discretion within the purposes specified for the County’s funds.

• As of December 31, 2017, the County’s business-type funds reported a combined net position of $262.3 million. Of that amount, 15.8% or $41.5 million is unrestricted.

• At the end of 2017, the general fund total assigned fund balance was $2.9 million and the unassigned fund balance was $29.8 million. The fund balance amounts to 14.1% of total general fund detail revenues for 2017. Total fund balance of the general fund increased by 12.5% or $3.67 million for the year.

• No general obligation bonds were issued during 2017. Total activity for all general obligation bonds of the primary government during 2017 resulted in a decrease of $19.7 million.

USING THIS ANNUAL REPORT

This annual report consists of a series of financial statements. The Basic Financial Statements include the Government-wide Financial Statements, Fund Financial Statements and Notes to the Financial Statements. Within the Government-wide Financial Statements, the Statement of Net Position and the Statement of Activities provide information about the activities of the County as a whole and present a longer-term view of the County’s finances. Fund Financial Statements for governmental funds tell how these funds’ services were financed in the short term as well as what remains for future spending. Fund Financial Statements also report the County’s operations in more detail than the Government-wide Statements by providing information about the County’s most significant funds. The remaining Basic Financial Statements provide financial information about activities for which the County acts solely as a trustee or agent for the benefit of those outside of the primary government.

The Comprehensive Annual Financial Report (CAFR) also includes a Supplemental Schedules section that provides more detailed information about the County.

4 Snohomish County MD&A For the Year Ended December 31, 2017

Reporting the County as a Whole - Countywide Financial Statements The Countywide financial statements are designed to provide readers with a broad overview of the County’s finances, in a manner similar to a private-sector business.

Statement of Net Position and Statement of Activities The Statement of Net Position presents information on all of the County’s assets plus deferred outflows of resources, liabilities plus deferred inflows of resources, and the difference reported as net position. The Statement of Activities presents information showing how the County’s net position changed during the current year. These statements are prepared using the accrual basis of accounting similar to the accounting method used by private sector companies. This basis of accounting takes into consideration all of the current year’s revenues and expenses, regardless of when the cash is received or paid.

These two statements report the County’s net position and changes in it. Over time, increases or decreases in the County’s net position may be one indicator of whether its financial health is improving or deteriorating. Readers of these statements should also consider other non-financial factors, such as changes in the County’s property tax base and the condition of the County’s roads, to assess the overall health of the County.

Within the Statement of Net Position and the Statement of Activities, the County’s financial information is divided into three types of activities:

Governmental Activities: Most of the County’s functions are reported here, including general government, judicial, public safety, physical environment, transportation, health and human services, economic environment, and culture and recreation. Governmental activities are primarily supported by property taxes, charges for services, sales taxes, federal and state grants, and state shared revenues.

Business-Type Activities: These functions are intended to recover all, or a significant portion of, their costs through user fees and charges to external users of goods and services. User fees are charged for surface water management, solid waste disposal, and the Paine Field Airport.

Discretely Presented Component Units: The County’s financial statements include financial information of the Pilchuck Development Corporation (PDC) and the Snohomish County Public Facilities District (PFD). These component units are described in the notes to the financial statements. The component units are separate legal entities that may buy, sell, lease, and mortgage property in their own name and can sue or be sued in their own name.

Reporting the County’s Most Significant Funds

Fund Financial Statements: The fund financial statements provide detailed information about the most significant funds. Some funds are required to be established by state law or by bond covenants. The County Council establishes funds to help it control and manage money for particular purposes (an example would be the Snohomish County Road Fund) or to show that it is meeting legal responsibilities for using certain taxes, grants, and other funding sources (an example would be grants received from the federal government for various services provided by the Human Services Department). The County’s governmental and proprietary funds use different accounting methods, which are described in the following sections.

5 Snohomish County MD&A For the Year Ended December 31, 2017

Governmental funds: Most of the County’s basic services are reported in governmental funds, which focus on how money flows into and out of the funds and the balances left at year-end that are available for spending. These funds are reported using an accounting method called modified accrual accounting, which measures cash and all other financial assets that can be readily converted to cash. The governmental fund statements provide a detailed short-term view of the County’s general government operations and the basic services it provides. Governmental fund information assists in determining if fewer financial resources can be spent in the near future to finance the County’s programs. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near-term financing decisions. Reconciliation Statements are provided to describe the relationship (or differences) between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds. The County’s major governmental funds are the General Fund, the County Road Fund, the Human Services Fund and the Capital Projects Fund. Individual fund data for each of the non-major funds is provided in the form of combining statements in the supplemental schedules section.

Proprietary funds: Proprietary funds are generally used to account for services for which the County charges customers a fee. Proprietary funds are reported using the accrual method of accounting, which is the same method used for reporting the Statement of Net Position and the Statement of Activities. The proprietary fund statements provide additional types of information as compared to the governmental fund statements, such as cash flow information.

Reporting the County’s Fiduciary Responsibilities: The County is the trustee, or fiduciary, for several entities such as fire districts. All of the County’s fiduciary activities are reported in a separate Statement of Fiduciary Net Position and, for the external investment pool, a Statement of Changes in Fiduciary Net Position. These activities are excluded from the County’s other financial statements because the County cannot use the assets of those separate entities to finance its operations.

Notes to the 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.

Other Information – Combining Statements The combining statements, which provide detail information for non-major governmental funds, internal service funds, component units, and agency funds, are presented in the supplemental schedules section.

FINANCIAL ANALYSIS As noted earlier, the County’s net position, when reviewed over time, may serve as a useful indicator of the County’s long-term financial health. The following schedule provides a summary of the assets, deferred outflows of resources, liabilities, deferred inflows of resources and net position of the County.

6 Snohomish County MD&A For the Year Ended December 31, 2017

Net Position Governmental Business-Type Activities Activities Total 2017 2016 2017 2016 2017 2016 Assets Current $ 380,449,285 $ 346,349,320 $ 82,346,383 $ 80,373,051 $ 462,795,668 $ 426,722,371 Noncurrent 43,098,440 34,131,039 534,003 232,703 43,632,443 34,363,742 Capital Assets 1,271,026,996 1,256,057,102 302,738,017 296,746,413 1,573,765,013 1,552,803,515 Total Assets 1,694,574,721 1,636,537,461 385,618,403 377,352,167 2,080,193,124 2,013,889,628

Deferred Outflow of Resources 21,224,694 32,165,992 2,592,285 3,689,838 23,816,979 35,855,830

Liabilities Current Liabilities 104,985,603 91,045,166 17,629,485 18,549,116 122,615,088 109,594,282 Noncurrent Liabilities 448,151,404 490,997,686 105,611,652 116,714,476 553,763,056 607,712,162 Total Liabilities 553,137,007 582,042,852 123,241,137 135,263,592 676,378,144 717,306,444

Deferred Inflow of Resources 24,434,312 7,489,942 2,711,235 599,989 27,145,547 8,089,931

Net Position Net Investment in Capital Assets 1,067,965,229 1,041,598,717 219,759,682 210,544,046 1,287,724,911 1,252,142,763 Restricted 205,054,504 196,953,635 979,572 919,723 206,034,076 197,873,358 Unrestricted (134,791,637) (159,381,693) 41,519,062 33,714,655 (93,272,575) (125,667,038) Total Net Position $ 1,138,228,096 $ 1,079,170,659 $ 262,258,316 $ 245,178,424 $ 1,400,486,412 $ 1,324,349,083

Snohomish County’s overall financial position improved from 2016 to 2017. For the year ended December 31, 2017, net position changed as follows:

Total Net Position of the County increased by $76.1 million or 5.7% from the prior year. Governmental Activities’ Total Net Position increased by $59.1 million or 5.5% from the prior year. The Governmental Activities increase was primarily due to increases in various revenue sources other than capital grants and contributions, which again decreased year over year. The revenue increases were partially offset by corresponding percentage increases in several categories of functional expenses, primarily those within the transportation function. Business-Type Activities’ Total Net Position increased by $17.1 million or 7% from the prior year. The change was primarily due to continued positive operating results in each of the Proprietary Funds.

Total assets plus deferred outflows of resources of the County exceeded total liabilities plus deferred inflows of resources by $1.4 billion (net position). The increase in net position in 2017 reflects the County’s ability, on an annual basis, to meet its current obligations in those activities including debt service requirements. The unrestricted net position for governmental activities was ($134.8) million and for business-type activities was $41.5 million. A factor in the balance of unrestricted net position is long-term commitments that are greater than currently available resources. Specifically, the County’s governmental activities include general obligation debt for which no corresponding capital assets are currently recorded but for which future revenues are obligated. Governmental activities restricted net position was $205 million. The restricted net position of business-type activities was $980 thousand. Amounts reported in restricted net position are subject to external legal or contractual restrictions, such as those imposed by the Revised Code of Washington or by contractual agreements with parties outside the County.

The County’s total assets were $2.1 billion as of December 31, 2017. Capital assets represent $1.6 billion of this amount. As required by GASB Statement No. 34, the County reports its infrastructure assets as a component of total capital assets; infrastructure assets amounted to $767.4 million, net of depreciation, at December 31, 2017. The County’s current assets consist of $375.9 million of cash and investments, $85.5 million of

7 Snohomish County MD&A For the Year Ended December 31, 2017

receivables, net of allowance for uncollectible accounts, and miscellaneous other current assets of $1.4 million. Other non-current non-capital assets include $5.3 million for the County’s equity interest in the Snohomish Emergency Radio System joint venture, $23.3 million of notes/contracts receivable and $15.1 million of net pension assets.

The largest portion of the County’s net position, $1.3 billion, or 91.9%, reflects its investment in capital assets (e.g., land and improvements, buildings and building improvements, improvements other than buildings, machinery and equipment, vehicles, and infrastructure) less any related debt used to acquire those assets that is still outstanding. The County uses these capital assets for operations and to provide services to citizens; consequently, these assets are not available for future spending. Although the County’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources since the capital assets themselves cannot be used to liquidate these liabilities.

At December 31, 2017, the County had total outstanding liabilities of $676.4 million. General obligation bonds and other long-term loans payable were $400.8 million, of which $21.9 million was due within one year. Other current liabilities consist of accounts payable of $25.5 million, due to other governments in the amount of $18.9 million, unearned revenues of $24 million, accrued liabilities of $13.9 million and current portion of landfill closure costs of $416.8 thousand. A liability of $23.6 million is recorded for general liability and workers’ compensation claims, of which $5.1 million was due within one year. Other significant non- current liabilities include net pension liability of $120.4 million, compensated absences of $20.2 million, other post-employment benefits of $7.5 million and future landfill closure costs of $8.3 million. The following schedule provides a summary of the changes in net position:

8 Snohomish County MD&A For the Year Ended December 31, 2017

Changes in Net Position Governmental Business-Type Activities Activities Total 2017 2016 2017 2016 2017 2016 Revenues Program Revenues Charges for Services $ 115,804,512 $ 112,241,297 $ 107,761,227 $ 99,559,505 $ 223,565,739 $ 211,800,802 Operating Grants and 66,619,250 67,951,238 1,706,230 2,282,226 68,325,480 70,233,464 Capital Grants and Contributions 83,023,425 90,906,060 8,384,461 14,335,757 91,407,886 105,241,817 Total Program Revenues 265,447,187 271,098,595 117,851,918 116,177,488 383,299,105 387,276,083

General Revenues Property Taxes 154,769,362 150,138,657 - - 154,769,362 150,138,657 Sales/Use Taxes 74,794,126 69,981,061 - - 74,794,126 69,981,061 Real Estate Excise Tax 22,915,311 21,382,632 - - 22,915,311 21,382,632 Business and Other Taxes 15,640,297 14,946,561 - - 15,640,297 14,946,561 Intergovernmental Revenues 5,654,949 5,643,518 - - 5,654,949 5,643,518 Interest and Investment Earnings 10,404,089 8,740,027 765,478 393,525 11,169,567 9,133,552 Miscellaneous Revenues 86,869 717,597 - 13,852 86,869 731,449 Total General Revenues 284,265,003 271,550,053 765,478 407,377 285,030,481 271,957,430 Total Revenues 549,712,190 542,648,648 118,617,396 116,584,865 668,329,586 659,233,513

Expenses General Government 74,203,806 74,037,072 - - 74,203,806 74,037,072 Judicial 33,233,405 35,192,199 - - 33,233,405 35,192,199 Public Safety 139,604,215 138,272,437 - - 139,604,215 138,272,437 Physical Environment 2,453,544 2,670,120 - - 2,453,544 2,670,120 Transportation 109,921,614 92,094,703 - - 109,921,614 92,094,703 Health and Human Services 69,877,361 71,597,708 - - 69,877,361 71,597,708 Economic Environment 28,428,899 23,730,709 - - 28,428,899 23,730,709 Culture and Recreation 20,022,978 19,516,842 - - 20,022,978 19,516,842 Interest on Long-Term Debt 11,677,761 12,481,051 - - 11,677,761 12,481,051 Airport - - 23,069,603 22,881,792 23,069,603 22,881,792 Solid Waste - - 58,157,108 54,099,470 58,157,108 54,099,470 Surface Water - - 21,541,963 21,379,571 21,541,963 21,379,571 Total Expenses 489,423,583 469,592,841 102,768,674 98,360,833 592,192,257 567,953,674

Excess (Deficiency) Before Transfers 60,288,607 73,055,807 15,848,722 18,224,032 76,137,329 91,279,839 Transfers In (Out) (1,231,170) (803,813) 1,231,170 803,813 - - Change in Net Position 59,057,437 72,251,994 17,079,892 19,027,845 76,137,329 91,279,839 Net Position, Beginning of Year 1,079,170,659 1,006,918,665 245,178,424 226,150,579 1,324,349,083 1,233,069,244 Net Position, End of Year $ 1,138,228,096 $ 1,079,170,659 $ 262,258,316 $ 245,178,424 $ 1,400,486,412 $ 1,324,349,083

The Total Change in Net Position was an increase of 5.7% or $76.1 million from the prior year. Of that total, Governmental Activities most significant revenue increases came from various tax revenues. The revenue increases were slightly offset by decreases in capital grants and contributions. Governmental Activities’ expense increased from the prior year by 4.2%, resulting in an Excess Before Transfers of $60.3 million. In total, governmental activities’ change in net position reflects an increase of $59.1 million or 5.5% from the prior year’s net position. Business-type Activities’ change in net position reflects an increase of $17.1 million or 7% from the prior year’s net position primarily due to increases in charges from services revenues received by the Solid Waste and Surface Water Management funds.

Total 2017 revenues for the County were $668.3 million, an increase of $9.1 million or 1.4% from the prior year. Of the total County revenues, governmental activities provided 82.3%, or $549.7 million, while business-type activities provided 17.7%, or $118.6 million.

The majority of revenues for governmental activities were derived from property taxes, charges for services, capital grants and contributions, operating grants and contributions, and sales/use taxes. Together those revenue sources accounted for 90% of total governmental activity revenues. Property taxes provided 28.2% or $154.8 million, charges

9 Snohomish County MD&A For the Year Ended December 31, 2017

for services provided 21.1% or $115.8 million, capital grants and contributions provided 15.1% or $83 million, operating grants and contributions provided 12.1% or $66.6 million, and sales/use taxes provided 13.6% or $74.8 million of total governmental activity revenues. Most of the governmental activities' resources were spent for Public Safety, 28.5%, Transportation, 22.5%, Health and Human Services, 14.3%, General Government, 15.2%, and Judicial, 6.8%. Interest on long-term debt and amortization of debt related items totaled $11.7 million, which was 2.4% of governmental activities expenses for 2017.

Revenues for business-type activities consisted primarily of charges for services of $107.8 million, which were 90.8% of total business-type activities revenues. Operating expenses for Solid Waste Management represented 56.6% of total expenses for business-type activities, Airport expenses were at 22.4% and Surface Water Management expenses were at 21%.

FUND FINANCIAL INFORMATION

Governmental Funds The General Fund, County Road Fund, Human Services Fund and Capital Projects Fund are the County’s 2017 major funds. These funds account for 62.8% of total governmental fund assets and 57.3% of total governmental fund balances. Governmental funds’ total assets amounted to $335.4 million and total liabilities were $63.5 million. The governmental funds’ sources of funds exceeded the uses of funds, resulting in a net increase in fund balance of $25.5 million. This was largely due to a variety of revenue and expenditure changes within most funds. The total fund balance for all governmental funds at December 31, 2017 was $267 million.

10 Snohomish County MD&A For the Year Ended December 31, 2017

General Fund The County’s General Fund is the primary operating fund of the County used to account for all financial resources other than the resources that are required to be accounted for separately. As of December 31, 2017, total assets were $42.2 million, total liabilities were $6.2 million and deferred inflows of resources were $3 million. The ending fund balance of $33 million represents approximately 13.4% of the 2018 budgeted uses of funds for the 2018 fiscal year.

The net change in fund balance for the general fund in 2017 was an increase of $3.7 million or 12.5%. Detail revenues increased $5.4 million and detail expenditures increased $8.95 million. The revenue increase was primarily due to increased sales/use tax revenues. The most significant increase in general fund expenditures was in Public Safety, salaries and benefits accounted for $3.1 million of the increase.

Significant General Fund Balance Sheet Changes: Description 2017 2016 $ Change % Change Total Assets $ 42,153,328 $ 40,278,644 $ 1,874,684 4.7% Total Liabilities $ 6,162,169 $ 7,794,952 $ (1,632,783) -20.9% Fund Balance $ 32,953,527 $ 29,286,965 $ 3,666,562 12.5%

Significant General Fund Revenue Increases: Description 2017 2016 $ Change % Change Sales/Use Tax $ 59,224,617 $ 55,657,802 $ 3,566,815 6.4%

Significant General Fund Expenditure Increases: Description 2017 2016 $ Change % Change Public Safety $ 123,687,677 $ 117,692,772 $ 5,994,905 5.1%

County Road Fund The County Road Fund accounts for the construction, maintenance and inspection of county streets, roads, and bridges and other countywide public works projects. The fund reported total assets of $39.7 million, total liabilities of $3.8 million and an ending fund balance of $34.3 million, an increase of $1.8 million or 5.5% from the prior year. Detail revenues increased by 10.2% or $9.2 million and expenditures increased by 4.7% or $4.3 million during 2017.

Significant Road Fund Balance Sheet Changes: Description 2017 2016 $ Change % Change Total Assets $ 39,685,141 $ 37,227,726 $ 2,457,415 6.6% Total Liabilities $ 3,783,284 $ 3,278,254 $ 505,030 15.4% Fund Balance $ 34,349,728 $ 32,564,211 $ 1,785,517 5.5%

The most significant change in total assets resulted from an increase of $2.5 million in cash and investment balances, which was a direct result of increased revenues.

Significant Road Fund Revenue & Other Financial Sources Changes: Description 2017 2016 $ Change % Change Property Tax $ 62,070,742 $ 59,855,621 $ 2,215,121 3.7% Charges for Service $ 13,352,811 $ 11,324,903 $ 2,027,908 17.9% Intergovernmental Revenue $ 22,543,753 $ 17,663,609 $ 4,880,144 27.6%

11 Snohomish County MD&A For the Year Ended December 31, 2017

The most significant changes in revenues were (1) increased property tax receipts, (2) increased charges for service due to performing more work for outside agencies, and (3) increases in intergovernmental revenues associated with grants from the Department of Transportation.

Significant Road Fund Expenditure Changes: Description 2017 2016 $ Change % Change General Govt. $ 11,229,034 $ 8,612,528 $ 2,616,506 30.4% Transportation including capital $ 82,841,626 $ 80,485,380 $ 2,356,246 2.9%

Significant expenditure changes were primarily the result of increased general government expenditures due to performance of more reimbursable work and increased local work related to increased grant funding for specific projects.

The Human Services Fund The Human Services Fund accounts for the administration, planning, development and provision of the following services: energy assistance; long term care and aging; developmental disabilities; mental health; alcohol and other drug treatments; community services; children and youth; veteran's relief; and other human services in Snohomish County. Total assets for this fund were $64.1 million and total liabilities were $37.1 million. The ending fund balance of $27 million was an increase of $3 million, or 12.6% from the prior year.

Significant Human Services Fund Balance Sheet Changes: Description 2017 2016 $ Change % Change Total Assets $ 64,125,611 $ 56,392,610 $ 7,733,001 13.7% Total Liabilities $ 37,120,683 $ 32,406,973 $ 4,713,710 14.5% Fund Balance $ 26,962,742 $ 23,940,630 $ 3,022,112 12.6%

Changes in total assets resulted from increased cash balances that were used to provide a short-term loan to the capital projects fund. Total liabilities increased primarily due to increases in unearned revenue related to behavioral health programs.

Changes in Health and Human Services total detail revenues and expenditures were nominal.

The Capital Projects Fund The Capital Projects Fund accounts for major building construction projects throughout the County. It does not include construction projects related to proprietary fund programs. The current major project, still in the design phase, is a remodel/expansion of the County’s courthouse. The funding source is primarily bond proceeds received in 2013. During 2017, assets and fund balance decreased primarily due to expenditures related to the courthouse project. Expenditures increased from the prior year due to preparations leading to anticipated ground breaking in August 2018. Other revenue and expenditure classifications reported insignificant changes for the year.

Other Governmental Funds The County has 25 other special revenue funds, three debt service funds and four other capital projects funds. These funds reported total assets of $124.9 million, total liabilities

12 Snohomish County MD&A For the Year Ended December 31, 2017

of $10.6 million and fund balances of $114 million. $91.9 million of the ending fund balance was restricted and $22.1 million was committed.

Proprietary Funds The County reported three major enterprise funds that represent the business-type activities in the government-wide financial statements. Eight internal service funds account for the operation of services provided to the different departments of the County. The principal users of internal service fund services are the County’s governmental activities; therefore, the internal service funds are consolidated into the governmental column in the Government- wide Financial Statements.

Net Position - Proprietary Funds Solid Airport Surface Total Internal Service Waste Water Enterprise Funds Funds 2017 2016 2017 2016 2017 2016 2017 2016 2017 2016 Assets Current Assets $ 43,032,106 $ 43,611,336 $ 21,320,783 $ 15,126,178 $ 17,993,494 $ 21,635,537 $ 82,346,383 $ 80,373,051 $ 60,508,502 $ 53,226,954 Noncurrent Assets - - 534,003 232,703 - - 534,003 232,703 84,434 27,618 Capital Assets 60,842,124 60,947,058 170,764,025 173,931,617 71,131,868 61,867,738 302,738,017 296,746,413 42,122,767 38,895,634 Total Assets 103,874,230 104,558,394 192,618,811 189,290,498 89,125,362 83,503,275 385,618,403 377,352,167 102,715,703 92,150,206

Deferred Outflow of Resources 921,379 1,338,013 656,609 975,902 1,014,297 1,375,923 2,592,285 3,689,838 1,879,272 2,777,469

Liabilities Current Liabilities 7,437,992 6,859,553 6,698,468 7,203,387 3,493,025 4,486,176 17,629,485 18,549,116 30,558,810 19,504,500 Noncurrent Liabilities 32,770,816 37,777,749 62,891,137 66,844,183 9,949,699 12,092,544 105,611,652 116,714,476 43,843,265 42,889,736 Total Liabilities 40,208,808 44,637,302 69,589,605 74,047,570 13,442,724 16,578,720 123,241,137 135,263,592 74,402,075 62,394,236

Deferred Inflow of Resources 1,183,952 283,248 564,941 114,159 962,342 202,582 2,711,235 599,989 2,275,576 511,102

Net Position Net Investment in Capital Assets 42,096,189 39,543,258 111,113,128 114,739,913 66,550,365 56,260,875 219,759,682 210,544,046 39,552,800 35,979,262 Restricted - - - - 979,572 919,723 979,572 919,723 7,751,434 8,613,866 Unrestricted 21,306,660 21,432,599 12,007,746 1,364,758 8,204,656 10,917,298 41,519,062 33,714,655 (19,386,910) (12,570,791) Total Net Position $ 63,402,849 $ 60,975,857 $ 123,120,874 $ 116,104,671 $ 75,734,593 $ 68,097,896 $ 262,258,316 $ 245,178,424 $ 27,917,324 $ 32,022,337

Changes in Net Position – Proprietary Funds Solid Airport Surface Total Internal Service Waste Water Enterprise Funds Funds 2017 2016 2017 2016 2017 2016 2017 2016 2017 2016 Operating Income (Loss) $ 2,201,285 $ 3,276,238 $ 5,097,120 $ 4,438,001 $ 550,710 $ (915,161) $ 7,849,115 $ 6,799,078 $ (1,933,769) $ (4,099,268) Non-Operating Revenues (Expenses) 565,374 139,401 (1,351,181) (1,569,081) 400,953 (1,481,123) (384,854) (2,910,803) 620,254 601,150 Contributions and Transfers (339,667) (207,062) 3,270,264 5,447,722 6,685,034 9,898,910 9,615,631 15,139,570 (2,791,498) (2,434,168)

Changes in Net Position 2,426,992 3,208,577 7,016,203 8,316,642 7,636,697 7,502,626 17,079,892 19,027,845 (4,105,013) (5,932,286)

Statement of Cash Flow – Proprietary Funds Solid Airport Surface Total Internal Service Waste Water Enterprise Funds Funds 2017 2016 2017 2016 2017 2016 2017 2016 2017 2016

Cash Flow from Operating Activities $ 5,790,877 $ 13,059,034 $ 12,084,266 $ 11,800,082 $2,590,800 $ 2,067,973 $ 20,465,943 $ 26,927,089 $ 16,530,680 $ 6,029,895 Cash Flow from Capital and Related Financing Activities (7,265,549) (7,071,156) (7,189,009) (7,664,094) (8,036,836) (2,762,919) (22,491,394) (17,498,169) (7,011,924) (5,715,262) Cash Flow from Non-Capital Financing Activities 554,464 244,463 485,540 729,297 4,807,791 (1,532,413) 5,847,795 (558,653) (3,262,176) (2,267,479) Cash Flow from Investing Activities 812,878 (15,669,891) (2,836,685) (5,435,412) 150,069 5,204,732 (1,873,738) (15,900,571) 1,057,808 (2,325,593)

Net Increase (Decrease) in Cash and Cash Equivalents (107,330) (9,437,550) 2,544,112 (570,127) (488,176) 2,977,373 1,948,606 (7,030,304) 7,314,388 (4,278,439) - - - Cash and Cash Equivalents, January 1 5,106,280 14,543,830 2,555,505 3,125,632 5,322,884 2,345,511 12,984,669 20,014,973 25,901,682 30,180,121 Cash and Cash Equivalents, December 31 $ 4,998,950 $ 5,106,280 $ 5,099,617 $ 2,555,505 $ 4,834,708 $ 5,322,884 $ 14,933,275 $ 12,984,669 $ 33,216,070 $ 25,901,682

Non-Cash Investing, Capital and Related Financing Activities $ - $ - $ - $ - $ 25,725 $ - $ 25,725 $ - $ 676,053 $ 449,026

13 Snohomish County MD&A For the Year Ended December 31, 2017

Solid Waste Management Fund This fund accounts for solid waste disposal operations, capital improvements and debt service. Restricted investments of $8.7 million represent funds set aside to finance long- term landfill post-closure care costs. Total assets as of December 31, 2017 were $103.9 million, total liabilities were $40.2 million, and net position was $63.4 million. Net Position increased $2.4 million or 4% from the prior year primarily due to increased charges for service, which is reflective of an improving economy.

Airport Fund This fund accounts for the operation, capital improvements and debt service of Paine Field, Snohomish County’s Airport. Total assets were $192.6 million, total liabilities were $69.6 million, and net position was $123.1 million. The increase in net position of $7 million is reflective of improved operating results largely generated by a rental rate increase.

Surface Water Management Fund This fund accounts for the operations of the Surface Water Management Division. The purpose of this division is to protect and enhance water quality and aquatic habitats, and to minimize damage from flooding and erosion. Total assets as of December 31, 2017 were $89.1 million, total liabilities were $13.4 million, and net position was $75.7 million. The 2017 increase in operating income was largely due to increases in charges for services revenues of $1.5 million that were partially offset by increased personnel expenses of $1.1 million. The increase in personnel expenses was primarily driven by a 2.5% COLA combined with filling previously vacant positions.

Internal Service Funds The County’s internal service funds provide fleet management, information services, risk management, road surface materials (pits and quarries), employee benefits, facility services, employee training and security services. Total assets as of December 31, 2017 were $102.7 million, total liabilities were $74.4 million and net position was $27.9 million. Internal service funds' operating loss of $1.9 million was a decreased loss of over 52.8% or $2.2 million from the prior year operating loss. The decrease in total internal service funds operating loss was primarily the result of improved operating results of most internal service funds. The Insurance Fund again sustained losses due to the defense and settlement of claims. The Employee Benefits Fund sustained an operating loss primarily due to an actuarial calculated increase in incurred, but not yet paid claims (IBNP).

GENERAL FUND BUDGETARY HIGHLIGHTS The 2017 General Fund budget was crafted with the anticipation that departments would continue to manage tightly within their budgets and achieve a level of vacancy savings. There were also targeted reduction amounts included in most departments’ budgets. In aggregate, departments were able to achieve their budgeted targets. Revenues overall were higher than anticipated due to the robust local economy and in spite of reductions in law and justice revenues. The 2017 budget did include an increase in fund balance, however a greater increase was achieved due to the positive revenue performance and departments achieving their budgeted targets.

CAPITAL ASSETS AND DEBT ADMINISTRATION The following schedule provides a summary of the County’s capital assets activity. Snohomish County’s total investment in capital assets, including construction in progress and intangibles, amounts to $1.6 billion. Infrastructure assets, net of accumulated depreciation, represent $767.4 million of capital assets. More detailed information on the County’s capital assets can be found in Note 3D of this financial report.

14 Snohomish County MD&A For the Year Ended December 31, 2017

Capital Assets Governmental Business-type Total Activities Activities 2017 2016 2017 2016 2017 2016 Capital Assets Land $ 283,977,341 $ 298,995,761 $ 45,090,048 $ 44,628,136 $ 329,067,389 $ 343,623,897 Building and Structures, Net 152,291,989 159,598,577 95,326,101 98,965,493 247,618,090 258,564,070 Other Improvements, Net 56,279,392 56,613,379 38,931,676 42,081,803 95,211,068 98,695,182 Machinery and Equipment, Net 42,313,727 40,264,197 11,223,310 8,115,163 53,537,037 48,379,360 Infrastructure Assets, Net 667,213,675 648,736,294 100,151,946 81,178,989 767,365,621 729,915,283 Construction in Progress 58,552,077 40,951,874 11,411,628 20,980,176 69,963,705 61,932,050 Intangibles, Net 10,398,795 10,897,020 603,308 796,653 11,002,103 11,693,673 Total Capital Assets $ 1,271,026,996 $ 1,256,057,102 $ 302,738,017 $ 296,746,413 $ 1,573,765,013 $ 1,552,803,515

Governmental Activities - Capital Assets Governmental Activities reported an overall increase of $15 million, or 1.2%, in capital assets primarily due to completion/capitalization of multiple roads projects.

Business-Type Activities - Capital Assets Business-type activities reported an overall increase in capital assets of $6 million, or 2%, primarily due to the Smith Island restoration project.

Governmental Activities – Debt Principal payments made during 2017 for governmental activities’ debt totaled $13.9 million, which included $13.5 million for general obligation bond debt and $427 thousand for loans. Interest expense for 2017 was $12.5 million.

See Note 3F to the financial statements for additional information on long-term debt.

Business-Type Activities – Debt Total principal payments made during 2017 for business-type activities were $7.5 million, of which $6.3 million was for general obligation bond debt and $1.3 million repaid loans. Interest expense for 2017 was $3.2 million.

See Note 3F to the financial statements for additional information on long-term debt.

ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS AND RATES National and local data suggest that economic conditions in 2018 continue to be positive. In its advance estimate of real gross domestic product (GDP), the U.S. Bureau of Economic Analysis showed that GDP increased at an annual rate of 2.6 percent in the fourth quarter of 2017, after growing 3.2 percent in the third quarter. Consistent with the data at the national level, the Washington economy has continued to grow. In December 2017, the state’s unemployment rate was 4.9 percent, compared to 5.3 percent in December of the prior year. Locally, Snohomish County’s employment rate was better than the state, estimated to be 4.0 percent. At the close of 2017, Snohomish County had the second lowest unemployment rate in the state. Compared to a year ago, there are fewer aerospace manufacturing jobs in Snohomish County. However, the decline is offset by other sectors reporting increased employment, including trade, retail, and the federal government.

The 2018 budget took into consideration and adjusted downward the law and justice and other projected revenues. The preliminary look at 2018 to date and the 2019 budget, anticipates some of the previous declines in revenues in the law and justice area will level off or slightly increase, while other revenues will continue to follow budget projections. However, in spite of a healthy local economic base statutory revenue caps on property taxes

15 Snohomish County MD&A For the Year Ended December 31, 2017

limit the County’s revenue growth. This accompanied with continued expense pressures will make for a challenging 2019 budget process.

CONTACTING THE COUNTY’S FINANCIAL MANAGEMENT TEAM This financial report is designed to provide our citizens, taxpayers, customers, and creditors with a general overview of the County’s finances and to demonstrate the County’s accountability for the money it receives. If you have questions about this report or need additional financial information, contact the Finance Department, at the following address: Snohomish County, 3000 Rockefeller, M/S 610, Everett, WA 98201 or by calling 425-388- 3401 or by visiting our website: http://snohomishcountywa.gov/.

16

Financial Statements Snohomish County, WA Statement of Net Position December 31, 2017

Primary Government Governmental Business-type Component Activities Activities Total Units ASSETS Cash and Equivalents $ 134,370,113 $ 14,715,634 $ 149,085,747 $ - Cash and Equivalents, Restricted 16,741,700 217,641 16,959,341 970,846 Investments 112,839,640 48,134,422 160,974,062 - Investments, Restricted 40,183,323 8,737,688 48,921,011 - Taxes Receivables 3,925,011 - 3,925,011 - Other Receivables, Net 14,491,257 3,667,369 18,158,626 - Interest Receivable 9,247,458 267,880 9,515,338 - Due from Other Governments 47,299,443 6,605,749 53,905,192 - Inventories 1,351,340 - 1,351,340 - Total Current Assets 380,449,285 82,346,383 462,795,668 970,846

Non-Current Assets Notes/Contracts Receivable 23,290,707 - 23,290,707 - Investment in Joint Venture 5,274,424 - 5,274,424 - Land 283,977,341 45,090,048 329,067,389 - Buildings and Structures, Net 152,291,989 95,326,101 247,618,090 - Other Improvements, Net 56,279,392 38,931,676 95,211,068 - Machinery and Equipment, Net 42,313,727 11,223,310 53,537,037 - Infrastructure Assets, Net 667,213,675 100,151,946 767,365,621 - Construction in Progress 58,552,077 11,411,628 69,963,705 - Intangible Assets, Net 10,398,795 603,308 11,002,103 - Net Pension Asset 14,533,309 534,003 15,067,312 - Total Non-Current Assets 1,314,125,436 303,272,020 1,617,397,456 -

Total Assets 1,694,574,721 385,618,403 2,080,193,124 970,846

DEFERRED OUTFLOWS OF RESOURCES Deferred Outflows Related to Pensions 17,065,565 2,069,246 19,134,811 - Deferred Loss on Refunding 4,159,129 523,039 4,682,168 - Total Deferred Outflows of Resources 21,224,694 2,592,285 23,816,979 -

LIABILITIES Current Liabilities Accounts Payable 19,561,944 5,966,032 25,527,976 1,303 Payable from Restricted Assets - 197,876 197,876 - Claims and Judgments Payable 5,106,668 - 5,106,668 - Due to Other Governments 18,935,633 66 18,935,699 - Accrued Liabilities 11,337,047 2,553,387 13,890,434 - Unearned Revenue 22,930,289 1,049,347 23,979,636 - Employee Benefits Payable 12,628,456 16,716 12,645,172 - Bonds, Notes and Loans Payable 14,485,566 7,429,280 21,914,846 - Landfill Closure Costs - 416,781 416,781 - Total Current Liabilities 104,985,603 17,629,485 122,615,088 1,303

17 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Statement of Net Position December 31, 2017

Primary Government Governmental Business-type Component Activities Activities Total Units

Non-Current Liabilities Employee Benefits Payable 18,518,583 1,654,790 20,173,373 - Other Post-Employment Benefits 7,464,793 - 7,464,793 - Bonds, Notes and Loans Payable 297,671,047 81,257,584 378,928,631 - Claims and Judgments Payable 18,513,146 - 18,513,146 - Landfill Closure Costs - 8,320,907 8,320,907 - Net Pension Liability 105,983,835 14,378,371 120,362,206 - Total Non-Current Liabilities 448,151,404 105,611,652 553,763,056 -

Total Liabilities 553,137,007 123,241,137 676,378,144 1,303

DEFERRED INFLOWS OF RESOURCES Deferred Service Concession Arrangement Receipts 1,154,039 - 1,154,039 - Grants Received in Advance 38,143 - 38,143 - Deferred Inflows Related to Pensions 22,925,440 2,687,103 25,612,543 - Deferred Gain on Refunding 316,690 24,132 340,822 - Total Deferred Inflows of Resources 24,434,312 2,711,235 27,145,547 -

NET POSITION Net Investment in Capital Assets 1,067,965,229 219,759,682 1,287,724,911 - Restricted for: General Government 4,668,767 - 4,668,767 - Judicial 1,601,189 - 1,601,189 - Public Safety 8,115,424 - 8,115,424 - Physical Environment 1,948,075 979,572 2,927,647 - Transportation 36,915,206 - 36,915,206 - Health and Human Services 26,790,767 - 26,790,767 - Economic Environment 12,234,922 - 12,234,922 854,845 Culture and Recreation 3,672,174 - 3,672,174 114,698 Capital Purposes 109,107,980 - 109,107,980 - Total Restricted Net Position 205,054,504 979,572 206,034,076 969,543

Unrestricted (134,791,637) 41,519,062 (93,272,575) -

Total Net Position $ 1,138,228,096 $ 262,258,316 $ 1,400,486,412 $ 969,543

The notes to the financial statements are an integral part of this statement. 18 19 SNOHOMISH COUNTY STATEMENT OF ACTIVITIES For the Year Ended December 31, 2017

Net (Expenses) Revenues and Program Revenues Changes in Net Position Operating Capital Primary Government Indirect Expense Charges for Grants and Grants and Governmental Business-type Component Expenses Allocation Services Contributions Contributions Activities Activities Total Units Functions/Programs Governmental activities: General Government $ 78,942,338 $ (4,738,532) $ 27,790,877 $ 5,084,866 $ 883,333 $ (40,444,730) $ - $ (40,444,730) $ - Judicial 33,094,684 138,721 8,587,202 1,680,225 187,593 (22,778,385) - (22,778,385) - Public Safety 139,313,523 290,692 30,286,650 11,268,589 - (98,048,976) - (98,048,976) - Physical Environment 2,383,097 70,447 31,349 478 - (2,421,717) - (2,421,717) - Transportation 108,604,250 1,317,364 7,489,275 358,630 81,407,529 (20,666,180) - (20,666,180) - Health and Human Services 68,932,554 944,807 19,205,823 42,510,618 - (8,160,920) - (8,160,920) - Economic Environment 28,149,230 279,669 12,361,546 5,270,713 - (10,796,640) - (10,796,640) - Culture and Recreation 19,935,407 87,571 10,051,790 445,131 544,970 (8,981,087) - (8,981,087) - Interest on Long-Term Debt 11,677,761 - - - - (11,677,761) - (11, 677,761) - Total governmental activities 491,032,844 (1,609,261) 115,804,512 66,619,250 83,023,425 (223,976,396) - (223,976,396) - Business-type activities: Airport 22,611,387 458,216 26,024,726 601,920 2,920,116 - 6,477,159 6,477,159 - Solid Waste Management 57,535,404 621,704 59,900,817 613,454 - - 2,357,163 2,357,163 - Surface Water Management 21,012,622 529,341 21,835,684 490,856 5,464,345 - 6,248,922 6,248,922 - Total business-type activities 101,159,413 1,609,261 107,761,227 1,706, 230 8,384,461 - 15,083,244 15,083,244 - The notes to the financial statements are an integral part of this statement. statements are an integral The notes to the financial Total primary government $ 592,192,257 $ - $ 223,565,739 $ 68,325,480 $ 91,407,886 $ (223,976,396) $ 15,083,244 $ (208,893,152) $ - Component units: Component Units $ 2,626,684 $ - $ - $ - $ - $ - $ - $ - $ (2,626,684) Total component units $ 2,626,684 $ - $ - $ - $ - $ - $ - $ - $ (2,626,684)

General revenues: Property Taxes 154,769, 362 - 154,769,362 - Sales/Use Tax 74,794,126 - 74,794,126 2,780,956 Real Estate Excise Tax 22,915,311 - 22,915,311 - Business and Other Taxes 15,640,297 - 15,640,297 - Intergovernmental Revenues 5,654,949 - 5,654,949 - Interest and Investment Earnings 10,404,089 765,478 11,169,567 4,354 Miscellaneous Revenues 86,869 - 86,869 - Total General Revenues 284,265,003 765,478 285,030,481 2,785,310 Transfers (1,231,170) 1,231,170 - - Total General Revenue and Transfers 283,033,833 1,996,648 285,030,481 2,785,310 Change in net position 59,057,437 17,079,892 76,137,329 158,626 Net position - Beginning 1,079,170,659 245,178,424 1,324,349,083 810,917 Net position - Ending $ 1,138,228,096 $ 262,258,316 $ 1,400,486,412 $ 969,543 Snohomish County, WA Balance Sheet Governmental Funds December 31, 2017

Other County Road Human Capital Projects Governmental General Fund Fund Services Fund Funds Total ASSETS Cash and Cash Equivalents $ 14,763,091 $ 16,340,776 $ 11,073,117 $ 9,453,139 $ 49,594,044 $ 101,224,167 Cash and Cash Equivalents, Restricted - 288,247 54,900 14,544,518 1,783,905 16,671,570 Investments - 14,625,230 8,249,036 - 64,572,372 87,446,638 Investments Restricted - - - 40,183,323 - 40,183,323 Taxes Receivable 2,249,600 1,543,605 42,186 - 89,620 3,925,011 Other Receivables, Net 6,831,474 47,522 13,125 144,063 525,819 7,562,003 Interest Receivable 601,220 84,742 723,247 49,383 271,211 1,729,803 Due From Other Funds - - 5,014,789 - 2,000,000 7,014,789 Due From Other Governments 17,707,943 6,755,019 15,664,504 217,547 6,051,323 46,396,336 Notes / Contracts Receivable - - 23,290,707 - - 23,290,707 Total Assets $ 42,153,328 $ 39,685,141 $ 64,125,611 $ 64,591,973 $ 124,888,294 $ 335,444,347

LIABILITIES Accounts Payable 2,675,571 2,549,768 6,678,071 468,408 2,800,365 15,172,183 Due To Other Funds - - - 5,014,789 - 5,014,789 Due To Other Governments 10,296 - 18,192,768 - 732,568 18,935,632 Accrued Liabilities 3,407,914 1,233,516 452,326 2,723 853,846 5,950,325 Unearned Revenue 68,388 - 11,797,518 360,422 6,190,095 18,416,423 Total Liabilities 6,162,169 3,783,284 37,120,683 5,846,342 10,576,874 63,489,352

DEFERRED INFLOWS OF RESOURCES Deferred Service Concession Arrangement Receipts 1,154,039 - - - - 1,154,039 Unavailable Revenue-Property Taxes 1,845,450 1,552,129 42,186 - 71,595 3,511,360 Unavailable Revenue - - - - 246,585 246,585 Grants Received in Advance 38,143 - - - - 38,143 Total Deferred Inflows of Resources 3,037,632 1,552,129 42,186 - 318,180 4,950,127

FUND BALANCES Restricted - 19,885,658 26,790,767 58,712,166 91,914,478 197,303,069 Committed 200,000 14,464,070 171,975 33,465 22,078,762 36,948,272 Assigned 2, 915,514 - - - - 2, 915,514 Unassigned 29,838,013 - - - - 29,838,013 Total Fund Balance 32,953,527 34,349,728 26,962,742 58,745,631 113,993,240 267,004,868

Total Liabilities, Deferred Inflows of Resources, and Fund Balances $ 42,153,328 $ 39,685,141 $ 64,125,611 $ 64,591,973 $ 124,888,294 $ 335,444,347

The notes to the financial statements are an integral part of this statement. 20 Reconciliation Governmental Funds Balance Sheet to the Statement of Net Position December 31, 2017 ______

Total fund balance as shown on the Governmental Funds Balance Sheet $ 267,004,868

Amounts reported for governmental activities in the statement of activities are different because:

Capital Assets used in governmental activities are not financial resources and are therefore not reported in the fund statement. This includes Investment in Joint Venture of $5 million. 1,234,178,650

Long-term debt is not due and payable in the current period and is therefore not reported in the fund statement. This includes the current and non- current portion of the long-term debt, and accrued interest payable. (307,721,590)

Internal service funds are used by the County to charge the costs of certain activities, like insurance and fleet services, to individual funds. The assets, deferred ouflow of resources, liabilities, and deferred inflow of resources of these funds are included in governmental activities in the Statement of Net Position. 27,917,324

Full accrual adjustments to the governmental funds, such as to record long term compensated absences payable, to record allowance for doubtful accounts, and to reclassify deferred revenues for property taxes. (83,151,156)

Net Position of Governmental Activities as shown on the Statement of Net Position $ 1,138,228,096

21 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Statement of Revenues, Expenditures and Changes In Fund Balances Governmental Funds For the Year Ended December 31, 2017

Other County Road Human Capital Projects Governmental General Fund Fund Services Fund Funds Total Detailed Revenues Property Taxes $ 85,719,698 $ 62,070,742 $ 1,823,332 $ - $ 3,771,845 $ 153,385,617 Sales/Use Taxes 59,224,617 - 15,219,509 - 350,000 74,794,126 Real Estate Excise Taxes - - - - 22,867,324 22,867,324 Business and Other Taxes 3,523,230 928,038 16,931 - 12,296,669 16,764,868 Licenses and Permits 4,566,778 - - - - 4,566,778 Charges for Services 45,658,853 13,352,811 20,199,036 214,840 28,307,767 107,733,307 Operating Assessments 21,112 4,113 - - - 25,225 Intergovernmental Revenues 15,356,882 22,543,753 45,066,507 217,547 10,330,369 93,515,058 Fines and Forfeitures 4,369,120 - 67,720 - 779,151 5,215,991 Interest and Investment Earnings 8,841,673 281,028 171,975 610,748 841,003 10,746,427 Rents, Leases, and Concessions 5,295,114 70,338 - - 4,489,456 9,854,908 Contributions and Donations - - 641,477 22,011 839,711 1,503,199 Miscellaneous Revenues 925,340 100,430 104,08 1 144,065 257,909 1,531,825 Total Detail Revenues 233,502,417 99,351,253 83,310,568 1,209,211 85,131,204 502,504,653

Detailed Expenditures Current General Government 57,866,042 11,229,034 1,798,851 - 6,793,873 77,687,800 Judicial 28,719,354 - 2,600,024 591,264 666,346 32,576,988 Public Safety 123,687,677 763,722 1,979,405 - 17,446,769 143,877,573 Physical Environment 1,322,605 - - - 480,812 1,803,417 Transportation - 60,653,116 - - - 60,653,116 Health and Human Services 3,282,522 - 67,873,458 - - 71,155,980 Economic Environment 4,125,633 - 6,278,305 - 17,354,755 27,758,693 Culture and Recreation 10,150,162 - 1,496,153 - 4,096,822 15,743,137 Debt Service Principal Payments - 395,439 - - 13,091,973 13,487,412 Interest and Other Charges 4,445 22,646 - - 12,344,998 12,372,089 Capital Outlay 404,896 22,188 ,510 164,550 4,398,416 8,437,984 35,594,356 Total Detail Expenditures 229,563,336 95,252,467 82,190,746 4,989,680 80,714,332 492,710,561

Excess (deficiency) of revenues over (under) expenditures 3,939,081 4,098,786 1,119,822 (3,780,469) 4,416,872 9,794,092

Other Financial Sources (Uses) Disposition Of Capital Assets 723,201 1,840,196 20,704 - 11,217,868 13,801,969 Transfers In 5,741,268 3,411,095 2,643,332 - 39,667,022 51,462,717 Transfers Out (6,736,988) (7,564,560) (761,746) (3,468,380) (31,055,672) (49,587,346) Total Other Financial Sources (Uses) (272,519) (2,313,269) 1,902,290 (3,468,380) 19,829,218 15,677,340

Net Change in Fund Balance 3,666,562 1,785,517 3,022,112 (7,248,849) 24,246,090 25,471,432

Fund Balance - Beginning 29,286,965 32,564,211 23,940,630 65,994,480 89,747,150 241,533,436 Fund Balance - Ending $ 32,953,527 $ 34,349,728 $ 26,962,742 $ 58,745,631 $ 113,993,240 $ 267,004,868

The notes to the financial statements are an integral part of this statement. 22 Reconciliation Governmental Funds Statement Of Revenues, Expenditures, and Changes in Fund Balances to the Statement of Activities For the Year Ended December 31, 2017 ______

Net change in fund balances of Governmental Funds $ 25,471,432

Amounts reported for governmental activities in the statement of activities are different because:

Governmental funds report capital outlay as expenditures. However, in the statement of activities the cost of these assets is allocated over their estimated useful lives and is reported as depreciation expense. (27,027,899)

Capital contributions, donations, and equity adjustment to the investment in joint venture do not provide current financial resources and therefore are not reported as revenues in governmental funds. 38,337,942

Repayment of bond principal are reported as expenditures in the fund statements and as a reduction of long-term liabilities in the statement of net position. 13,487,412

Accrued interest payable is not recorded on the fund statements. 825,972

Internal service funds are used by the County to charge the costs of certain activities, such as insurance and fleet management services, to individual funds. The net cost of the internal service funds are reported as governmental activities in the statement of activities. (4,105,013)

Some expenses and revenues reported in the statement of activities do not require the use of current financial resources and therefore are not reported as expenditures and revenues in governmental funds. 12,067,591

Change in net position of governmental activities on the statement of activities $ 59,057,437

23 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual General Fund For the Year Ended December 31, 2017

Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 957,146 $ 3,931,564 $ 29,286,965 $ 25,355,401

Resources (inflows) Property Taxes 86,626,410 86,626,410 85,719,698 (906,712) Sales/Use Taxes 57,181,705 57,181,705 59,224,617 2,042,912 Business and Other Taxes 3,475,126 3,475,126 3,523,230 48,104 License and Permits 4,398,000 4,398,000 4,566,778 168,778 Charges for Services 45,205,718 45,355,618 45,658,853 303,235 Operating Assessments 20,923 20,923 21,112 189 Intergovernmental Revenues 16,239,172 16,239,172 15,356,882 (882,290) Fines and Forfeitures 4,913,425 4,913,425 4,369,120 (544,305) Interest and Investment Earnings 7,738,901 7,738,901 8,841,673 1,102,772 Rents, Leases, and Concessions 5,035,058 5,035,058 5,295,114 260,056 Miscellaneous Revenues 1,132,893 1,132,893 925,340 (207,553) Transfers In 5,626,261 5,626,261 5,741,268 115,007 Disposition of Capital Assets 723,201 723,201 Total Resources (inflows) 237,593,592 237,743,492 239,966,886 2,223,394

Amounts Available for Appropriation 238,550,738 241,675,056 269,253,851 27,578,795

Charges to Appropriations (outflows) Executive Administration 2,232,259 2,232,259 2,172,469 59,790 Economic Development 520,011 520,011 509,709 10,302 Legislative Legislative Svs. 4,001,014 4,001,014 3,874,013 127,001 Performance Auditing 82,839 82,839 77,889 4,950 Human Services Human Services Administration 1,070,848 1,070,848 1,009,422 61,426 Human Services Support 2,531,332 2,531,332 2,531,332 - Planning and Development Services County Fire Marshal 563,634 563,634 548,876 14,758 Long Range Planning 2,481,944 2,481,944 2,428,645 53,299 Code Enforcement 944,231 944,231 944,157 74 Hearing Examiner Board Of Equalization 156,868 156,868 148,018 8,850 Hearing Examiner/BRB 786,117 786,117 694,566 91,551 Parks and Recreation Division Management 766,064 766,064 746,066 19,998 Parks Maintenance 2,198,084 2,198,084 2,181,048 17,036

The notes to the financial statements are an integral part of this statement. 24 Snohomish County, WA Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual General Fund For the Year Ended December 31, 2017

Budgeted Amounts Original Final Actual Variance Fair Administration General 2,484,551 2,484,551 2,483,144 1,407 Fairgrounds Maintenance 1,432,463 1,432,463 1,421,971 10,492 Fair Operations General 1,032,656 1,032,656 1,010,752 21,904 Routine Maint & Operation 2,897,547 3,047,447 2,997,213 50,234 Assessor Tax Assessments 7,885,717 7,885,717 7,555,135 330,582 Auditor Administration 719,279 719,279 717,964 1,315 Records Services 961,123 961,123 939,776 21,347 Licensing 1,323,062 1,283,062 1,229,004 54,058 Animal Control Services 1,355,595 1,395,595 1,322,605 72,990 Election Services 2,242,162 2,242,162 2,074,097 168,065 Voter Registration Service 874,696 874,696 781,269 93,427 Finance Budget And Systems Service 879,962 879,962 876,157 3,805 Finance Operations 2,719,112 2,719,112 2,537,131 181,981 Purchasing Services 723,607 723,607 720,602 3,005 Human Resources Administration 2,304,405 2,304,405 1,982,356 322,049 Equal Employ Opportunity 292,993 292,993 209,770 83,223 Nondepartmental Public Health 2,273,100 2,273,100 2,273,100 - Public Advocate 170,736 170,736 168,612 2,124 Miscellaneous 8,963,321 5,900,975 5,710,836 190,139 Treasurer Administration 3,646,437 3,646,437 3,298,580 347,857 District Court District Court 8,228,749 8,228,749 8,132,498 96,251 Probation & Parole Services 1,893,753 1,893,753 1,797,849 95,904 Dispute Resolution Center 150,000 150,000 104,162 45,838 Sheriff Administration 3,225,571 3,337,571 3,320,054 17,517 Administrative Services 1,175,388 1,825,388 1,787,331 38,057 Field Operations 5,147,149 5,137,149 5,075,247 61,902 Technical Operations 1,012,038 1,082,038 1,066,200 15,838 Investigation 4,629,223 4,919,223 4,867,483 51,740 Patrol 19,482,784 20,352,363 20,242,183 110,180 Narcotics Enforcement 1,110,104 1,139,047 1,112,542 26,505 Civil 394,079 405,079 404,353 726 Law Enforcement - Contract 9,199,509 9,909,509 9,757,580 151,929

25 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual General Fund For the Year Ended December 31, 2017

Budgeted Amounts Original Final Actual Variance Training 898,242 1,013,242 913,239 100,003 Traffic Policing 1,970,220 1,570,220 1,540,671 29,549 Communication 4,341,514 4,391,514 4,369,283 22,231 Technical Services 1,891,772 1,891,772 1,713,236 178,536 Evidence 741,299 741,299 694,509 46,790 Search And Rescue 690,595 764,595 744,831 19,764 Prosecuting Attorney Administration 820,492 820,492 817,183 3,309 Criminal 12,626,409 12,626,409 12,459,838 166,571 Civil 2,909,796 2,909,796 2,833,771 76,025 10* Permanent Transfer Out 280,653 280,653 277,332 3,321 Office of Public Defense Office of Public Defense 9,689,230 10,189,230 9,876,789 312,441 Medical Examiner Medical Examiner Services 2,787,210 2,787,210 2,492,717 294,493 Superior Court Juvenile Court Operations 10,031,886 9,777,123 9,569,122 208,001 Superior Court Operations 6,633,350 6,838,113 6,832,064 6,049 Administrative Services 5,321,934 5,371,934 5,346,522 25,412 Clerk Administration 1,834,889 1,907,484 1,876,392 31,092 Judicial Acctg/Judgmts 1,052,058 1,052,058 1,039,817 12,241 Case Management 1,126,142 1,151,357 1,144,070 7,287 Document Control 371,564 286,754 274,356 12,398 Courtroom Operations 1,967,523 1,964,523 1,905,565 58,958 Customer Service 1,192,689 1,182,689 1,157,066 25,623 Corrections Administration 7,342,632 7,529,732 7,455,195 74,537 Special Detention 1,304,031 1,184,031 1,132,793 51,238 Detention 33,486,360 36,550,502 36,428,435 122,067 Food Service 1,530,587 1,465,587 1,416,023 49,564 Medical Services 5,292,423 5,192,423 4,944,154 248,269 Department of Emergency Management DEM Operations 1,249,122 1,249,122 1,201,585 47,537 Amount Charged to Appropriations (outflows) 238,550,738 241,675,056 236,300,324 5,374,732

Budgeted Fund Balance, December 31 $ - $ - $ 32,953,527 $ 32,953,527

The notes to the financial statements are an integral part of this statement. 26 Snohomish County, WA Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual County Roads Fund For the Year Ended December 31, 2017

Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 12,256,871 $ 12,256,871 $ 32,564,211 $ 20,307,340

Resources (inflows) Property Taxes 60,728,685 60,728,685 62,070,742 1,342,057 Business and Other Taxes 850,000 850,000 928,038 78,038 Charges for Services 14,030,813 16,635,392 13,352,811 (3,282,581) Operating Assessments 10,000 10,000 4,113 (5,887) Intergovernmental Revenues 26,098,864 26,098,864 22,543,753 (3,555,111) Interest and Investment Earnings 127,500 127,500 281,028 153,528 Rents, Leases, and Concessions 87,000 87,000 70,338 (16,662) Miscellaneous Revenues 125,000 125,000 100,430 (24,570) Transfers In 4,979,570 4,979,570 3,411,095 (1,568,475) Disposition of Capital Assets 250,000 250,000 1,840,196 1,590,196 Bond Proceeds - - - - Total Resources (inflows) 107,287,432 109,892,011 104,602,544 (5,289,467)

Amounts Available for Appropriation 119,544,303 122,148,882 137,166,755 15,017,873

Charges to Appropriations (outflows) Public Works TES Operations 6,297,457 6,297,457 5,741,174 556,283 TES Maintenance 2,392,133 2,392,133 2,127,595 264,538 TES Capital 3,176,994 3,176,994 964,075 2,212,919 TES Reimbursables 816,952 816,952 563,041 253,911 RM Operations 1,932,382 1,932,382 1,108,112 824,270 RM Maintenance 27,606,537 27,606,537 26,662,633 943,904 RM Capital 2,537,000 2,537,000 393,834 2,143,166 RM Reimbursables 3,499,068 3,499,068 3,004,050 495,018 ES Operations 4,650,209 4,650,209 4,447,921 202,288 ES Maintenance 800,206 800,206 621,412 178,794 ES Capital 32,946,890 32,946,890 26,207,478 6,739,412 ES Reimbursables 7,178,014 9,782,593 7,661,943 2,120,650 Administration 350,000 350,000 88,750 261,250 Admin Operations 25,194,345 25,194,345 23,094,960 2,099,385 Admin Operations Capital 166,116 166,116 130,049 36,067 Amount Charged to Appropriations (outflows) 119,544,303 122,148,882 102,817,027 19,331,855

Budgeted Fund Balance, December 31 $ - $ - $ 34,349,728 $ 34,349,728

27 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Human Services Fund For the Year Ended December 31, 2017

Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 6,742,684 $ 6,742,684 $ 23,940,630 $ 17,197,946

Resources (inflows) Property Taxes 1,754,672 1,754,672 1,823,332 68,660 Sales/Use Taxes 14,715,438 14,715,438 15,219,509 504,071 Business and Other Taxes 20,345 20,345 16,931 (3,414) Charges for Services 22,226,009 22,323,009 20,199,036 (2,123,973) Intergovernmental Revenues 50,839,644 51,005,742 45,066,507 (5,939,235) Fines and Forfeitures 63,579 63,579 67,720 4,141 Interest and Investment Earnings 30,000 30,000 171,975 141,975 Contributions and Donations 1,052,870 1,052,870 641,477 (411,393) Miscellaneous Revenues 6,154,444 5,891,346 104,081 (5,787,265) Transfers In 2,643,332 2,643,332 2,643,332 - Disposition of Capital Assets - - 20,704 20,704 Total Resources (inflows) 99,500,333 99,500,333 85,974,604 (13,525,729)

Amounts Available for Appropriation 106,243,017 106,243,017 109,915,234 3,672,217

Charges to Appropriations (outflows) Human Services CAP/CSBG 222,571 472,571 410,501 62,070 Family Support Services 282,000 282,000 281,986 14 Community Information Line 19,600 19,600 19,600 - Agriculture 432,220 432,220 380,165 52,055 Youth Services 394,270 394,270 369,097 25,173 Natural Resources 87,161 184,161 180,980 3,181 Family Living 126,427 126,427 101,986 24,441 DUI Countermeasure 78,722 78,722 58,833 19,889 ECEAP Administration 478,906 478,906 451,210 27,696 ECEAP Operations 1,095,402 1,095,402 982,473 112,929 Early Head Start Admin 164,564 164,564 158,387 6,177 Early Head Start Ops 1,036,246 1,036,246 1,029,936 6,310 Energy Administration 171,841 171,841 159,034 12,807 Energy Program Support 423,178 423,178 299,704 123,474 Energy Consumer Education 149,812 149,812 83,928 65,884 Energy Dir Svcs - EAP/ECIP 2,054,871 2,054,871 1,461,896 592,975 Weatherization Administration 165,168 165,168 159,537 5,631 Weatherization Program Support 841,567 841,567 711,096 130,471 Weatherization Labor 888,689 888,689 767,832 120,857 Veterans Relief 961,468 961,468 825,314 136,154

The notes to the financial statements are an integral part of this statement. 28 Snohomish County, WA Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Human Services Fund For the Year Ended December 31, 2017

Budgeted Amounts Original Final Actual Variance Behavioral Health 2,938,516 2,938,516 2,426,836 511,680 Housing, Homeless, Comm Dev 5,946,832 5,881,832 4,346,277 1,535,555 Housing, Homeless Services 4,456,570 4,456,570 4,394,313 62,257 Involuntary Treatment Admin 2,558,356 2,558,356 2,393,942 164,414 Resource Management 327,931 327,931 303,797 24,134 Aging Administration 1,134,770 1,255,868 1,046,058 209,810 Transportation 110,000 110,000 110,000 - Information & Assistance 30,328 30,328 30,328 - Case Management 8,117,043 8,117,043 7,302,059 814,984 Adult Day Health 2,000 2,000 2,000 - Home Delivered Meals 40,000 40,000 40,000 - RSVP Sr Prg 55,000 55,000 54,639 361 Senior Center Operations 465,500 465,500 463,925 1,575 Alcohol & Other Drugs 204 204 - 204 Dev Dis Program Admin 1,792,301 1,682,301 1,499,107 183,194 Infant Toddler Early Intervent 860,875 970,875 934,349 36,526 Chem Dependcy/Mental Hlth Srvs 1,493,478 1,493,478 1,350,983 142,495 Contracted CD/MH Enhanced Srvs 11,263,359 11,263,359 5,899,834 5,363,525 Pass-Through Grants 47,318,415 46,915,317 34,979,418 11,935,899 Sheriff Training 31,204 31,204 6,429 24,775 Detention 1,790,182 1,790,182 1,667,322 122,860 Prosecuting Attorney Criminal 535,137 535,137 440,737 94,400 Civil 114,970 114,970 114,970 - TAP 474,434 474,434 474,288 146 Office of Public Defense Office of Public Defense 769,979 769,979 768,856 1,123 District Court District Court - MH Court 190,892 190,892 147,771 43,121 Superior Court Superior Court Operations 3,095,738 3,095,738 2,606,439 489,299 Clerk Courtroom Operations 254,320 254,320 254,320 - Amount Charged to Appropriations (outflows) 106,243,017 106,243,017 82,952,492 23,290,525

Budgeted Fund Balance, December 31 $ - $ - $ 26,962,742 $ 26,962,742

29 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Statement of Net Position Proprietary Funds December 31, 2017 Governmental Business Type Activities Activities Total Enterprise Internal Service Solid Waste Airport Surface Water Funds Funds ASSETS Current Assets Cash and Cash Equivalents $ 4,801,074 $ 5,099,617 $ 4,814,943 $ 14,715,634 $ 33,145,940 Cash and Cash Equivalents, Restricted 197,876 - 19,765 217,641 70,130 Investments 24,126,809 14,517,613 9,490,000 48,134,422 25,393,003 Investments, Restricted 8,737,688 - - 8,737,688 - Other Receivables, Net 3,296,097 262,879 108,393 3,667,369 261,352 Interest Receivable 151,479 61,896 54,505 267,880 132,970 Due From Other Governments 1,721,083 1,378,778 3,505,888 6,605,749 153,767 Inventories - - - - 1,351,340 Total Current Assets 43,032,106 21,320,783 17,993,494 82,346,383 60,508,502

Non-Current Assets Capital assets Land 12,186,598 22,108,409 10,795,041 45,090,048 392,678 Buildings and Structures, Net 19,299,966 76,026,135 - 95,326,101 9,377,833 Other Improvements, Net 20,855,952 - 18,075,724 38,931,676 1,846,554 Machinery and Equipment, Net 8,200,800 2,923,236 99,274 11,223,310 29,170,460 Infrastructure Assets, Net 298,808 62,324,313 37,528,825 100,151,946 - Construction in Progress - 6,778,624 4,633,004 11,411,628 1,322,354 Intangibles, Net - 603,308 - 603,308 12,888 Net Pension Asset - 534,003 - 534,003 84,434 Total Non-Current Assets 60,842,124 171,298,028 71,131,868 303,272,020 42,207,201

Total Assets 103,874,230 192,618,811 89,125,362 385,618,403 102,715,703

DEFERRED OUTFLOW OF RESOURCES Deferred Loss on Refunding - 273,084 249,955 523,039 82,047 Deferred Outflows Related to Pensions 921,379 383,525 764,342 2,069,246 1,797,225 Total Deferred Outflow of Resources 921,379 656,609 1,014,297 2,592,285 1,879,272

The notes to the financial statements are an integral part of this statement. 30 Snohomish County, WA Statement of Net Position Proprietary Funds December 31, 2017 Governmental Business Type Activities Activities Total Enterprise Internal Service Solid Waste Airport Surface Water Funds Funds LIABILITIES Current Liabilities: Accounts Payable 3,236,983 930,937 1,798,112 5,966,032 4,389,752 Claims and Judgments Payable - - - - 5,106,668 Due to Other Governments - - 66 66 - Due to Other Funds - - - - 2,000,000 Accrued Liabilities 609,193 1,690,840 253,354 2,553,387 1,756,997 Unearned Revenue - 833,559 215,788 1,049,347 4,513,865 Employee Benefits Payable 7,068 4,494 5,154 16,716 12,459,838 Bonds, Notes and Loans Payable 2,970,091 3,238,638 1,220,551 7,429,280 331,690 Landfill Closure Costs 416,781 - - 416,781 - Payable from Restricted Assets 197,876 - - 197,876 - Total Current Liabilities 7,437,992 6,698,468 3,493,025 17,629,485 30,558,810

Non-Current Liabilities Employee Benefits Payable 699,693 444,863 510,234 1,654,790 1,825,288 Landfill Closure Costs 8,320,907 - - 8,320,907 - Other Post-Employment Benefits - - - - 7,464,793 Bonds, Notes, and Loans Payable 17,117,535 60,158,332 3,981,717 81,257,584 3,223,326 Claims and Judgments Payable - - - - 18,513,146 Net Pension Liability 6,632,681 2,287,942 5,457,748 14,378,371 12,816,712 Total Non-Current Liabilities 32,770,816 62,891,137 9,949,699 105,611,652 43,843,265

Total Liabilities 40,208,808 69,589,605 13,442,724 123,241,137 74,402,075

DEFERRED INFLOW OF RESOURCES Deferred Gain on Refunding 24,132 - - 24,132 - Deferred Inflows Related to Pensions 1,159,820 564,941 962,342 2,687,103 2,275,576 Total Deferred Inflow of Resources 1,183,952 564,941 962,342 2,711,235 2,275,576

NET POSITION Net Investment in Capital Assets 42,096,189 111,113,128 66,550,365 219,759,682 39,552,800

Restricted for: Capital Purposes - - - - 7,751,434 Physical Environment - - 979,572 979,572 - Total Restricted Net Position - - 979,572 979,572 7,751,434

Unrestricted 21,306,660 12,007,746 8,204,656 41,519,062 (19,386,910)

Total Net Position $ 63,402,849 $ 123,120,874 $ 75,734,593 $ 262,258,316 $ 27,917,324

31 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Statement of Revenues, Expenses and Changes in Net Position Proprietary Funds For the Year Ended December 31, 2017 Governmental Business Type Activities Activities Total Enterprise Internal Service Solid Waste Airport Surface Water Funds Funds Operating Revenues Charges for Services $ 59,137,286 $ 6,153,526 $ 2,637,868 $ 67,928,680 $ 107,643,998 Special Assessments - - 19,544,399 19,544,399 - Rents, Leases, and Concessions 734,061 20,254,771 - 20,988,832 12,075,700 Total Operating Revenues 59,871,347 26,408,297 22,182,267 108,461,911 119,719,698

Operating Expenses Personnel Services 13,186,887 5,948,371 9,764,991 28,900,249 25,447,113 Supplies 772,158 836,033 247,012 1,855,203 7,706,957 Interfund-Intergovernmental Payments for Service 6,701,363 1,370,074 4,882,119 12,953,556 6,307,758 Depreciation 3,592,400 7,395,824 2,044,296 13,032,520 4,022,851 Miscellaneous Expenses - - - - - Contractual Services 33,417,254 5,760,875 4,693,139 43,871,268 78,168,788 Total Operating Expenses 57,670,062 21,311,177 21,631,557 100,612,796 121,653,467

Operating Income (Loss) 2,201,285 5,097,120 550,710 7,849,115 (1,933,769)

Non-Operating Revenues (Expenses) Intergovernmental Revenues 613,454 601,920 490,856 1,706,230 37,600 Interest and Investment Earnings 409,497 188,894 167,087 765,478 351,895 Miscellaneous Revenues 49,365 1,927 55,751 107,043 117,956 Disposition of Capital Assets 300 36,282 (25,086) 11,496 244,448 Interest and Other Charges (507,242) (2,180,204) (287,655) (2,975,101) (131,645) Total Non-Operating Revenues (Expenses) 565,374 (1,351,181) 400,953 (384,854) 620,254

Income (Loss) Before Contributions and Transfers 2,766,659 3,745,939 951,663 7,464,261 (1,313,515)

Capital Contributions - 2,920,116 5,464,345 8,384,461 - Transfers In - 350,148 1,457,909 1,808,057 678,702 Transfers Out (339,667) - (237,220) (576,887) (3,470,200) Change in Net Position 2,426,992 7,016,203 7,636,697 17,079,892 (4,105,013)

Net Position, Beginning 60,975,857 116,104,671 68,097,896 245,178,424 32,022,337 Net Position, Ending $ 63,402,849 $ 123,120,874 $ 75,734,593 $ 262,258,316 $ 27,917,324

The notes to the financial statements are an integral part of this statement. 32 Snohomish County, WA Statement of Cash Flows Proprietary Funds For the Year Ended December 31, 2017

Governmental Business Type Activities Activities Internal Solid Waste Airport Surface Water Total Service Funds

Cash Flows from Operating Activities Receipts from Operations $ 60,039,810 $ 26,583,369 $ 21,129,178 $ 107,752,357 $ 122,456,584 Payments to Employees (13,369,192) (6,220,664) (9,572,043) (29,161,899) (25,204,157) Payments of Claims (34,178,378) (6,908,365) (4,107,609) (45,194,352) (74,413,990) Internal Activity - Payment to Other Funds (6,701,363) (1,370,074) (4,858,726) (12,930,163) (6,307,757) Total Cash Flows from Operating Activities 5,790,877 12,084,266 2,590,800 20,465,943 16,530,680

Cash Flows from Capital and Related Financing Activities Capital Acquisition and Construction (3,827,134) (4,228,234) (12,066,433) (20,121,801) (7,871,806) Capital Grants - 2,920,116 5,438,620 8,358,736 - Sale of Capital Assets 300 36,282 - 36,582 1,454,762 Principal Paid on Loans (2,785,639) (3,615,691) (1,134,201) (7,535,531) (409,463) Interest Paid on Loans (653,076) (2,301,482) (274,822) (3,229,380) (185,417) Total Cash Flows from Capital and Related Financing Activities (7,265,549) (7,189,009) (8,036,836) (22,491,394) (7,011,924)

Cash Flows from Non-Capital Financing Activities Intergovernmental Revenue 505,099 133,465 3,531,351 4,169,915 87,419 Miscellaneous Revenue 49,365 1,927 55,751 107,043 117,956 Transfers - 350,148 1,220,689 1,570,837 (3,467,551) Total Cash Flows from Non-Capital Financing Activities 554,464 485,540 4,807,791 5,847,795 (3,262,176)

Cash Flows from Investing Activities Interest on Investments 352,246 163,315 150,069 665,630 295,854 Purchase of Investments 460,632 (3,000,000) - (2,539,368) (1,238,046) Interfund Loans - - - - 2,000,000 Total Cash Flows from Investing Activities 812,878 (2,836,685) 150,069 (1,873,738) 1,057,808

Net Increase (Decrease) in Cash and Cash Equivalents (107,330) 2,544,112 (488,176) 1,948,606 7,314,388 Cash and Cash Equivalents, January 1, 2017 5,106,280 2,555,505 5,322,884 12,984,669 25,901,682 Cash and Cash Equivalents, December 31, 2017 $ 4,998,950 $ 5,099,617 $ 4,834,708 $ 14,933,275 $ 33,216,070

Reconciliation of Operating Income to Net Cash Provided (Used) by Operating Activities Net Operating Income (loss) $ 2,201,285 $ 5,097,120 $ 550,710 $ 7,849,115 $ (1,933,769) Depreciation Expense 3,592,400 7,395,824 2,044,296 13,032,520 4,022,851 Changes in Receivables, Net 176,875 (156,455) 50,427 70,847 1,348,926 Changes in Inventories - - - - (71,818) Changes in Accounts Payable & Other Liabilities (179,683) (252,223) (134,596) (566,502) 13,164,490 Changes in Prepaid Items and Operating Assessments - - 79,963 79,963 - Net Cash Provided (Used) by Operating Activities $ 5,790,877 $ 12,084,266 $ 2,590,800 $ 20,465,943 $ 16,530,680

Non-Cash Investing, Capital and Related Financing Activities: Contributions of Capital Assets $ - $ - $ 25,725 $ 25,725 $ 676,053

33 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Statement of Net Position Fiduciary Funds December 31, 2017

Investment Trust Agency Funds Fund ASSETS

Current Assets Deposits and Investments with County Treasurer $ 666,214,856 $ 241,743,273 Taxes Receivable 23,349,408 - Other Receivables, Net 2,236,045 - Interest Receivable 90,355 651,290 Total Assets 691,890,664 242,394,563

LIABILITIES

Current Liabilities Due to Other Governments 691,890,664 -

Total Liabilities $ 691,890,664 -

NET POSITION Held in Trust for External Pool Participants $ 242,394,563

The notes to the financial statements are an integral part of this statement. 34 Snohomish County, WA Statement of Changes in Net Position Fiduciary Funds For the Year Ended December 31, 2017

Investment Trust Fund

ADDITIONS: Contributions $ 151,485,363 Interest 3,020,075 Total Additions 154,505,438

DEDUCTIONS: 162,163,630

Change in Net Position (7,658,192)

Net Position - January 1, 2017 250,052,755 Net Position - December 31, 2017 $ 242,394,563

35 The notes to the financial statements are an integral part of this statement. Notes to the Financial Statements December 31, 2017

Note 1 Summary of Significant Accounting Policies

General

The County of Snohomish, Washington (the “County”), was incorporated in 1861 and operates under the laws of the State of Washington applicable to a home rule charter county. The charter was adopted by a vote of the citizens of Snohomish County in 1979 and was amended through the charter review process effective January 1, 1997 and January 1, 2007. The executive branch of the county government is elected at large and consists of the county executive, the prosecuting attorney, the sheriff, the auditor, the clerk, the treasurer, and the assessor. Fifteen superior court judges and eight district court judges are also elected at large. A five-member council, elected by district, constitutes the legislative body.

Snohomish County is a general-purpose government and provides services such as public safety, fire prevention, road construction and maintenance, parks and recreation, judicial administration, health and social programs and general administration. The County also operates an airport, a fairground, is responsible for the disposal of solid waste, and the control of surface water runoff.

The County’s financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The significant accounting policies are described below.

1.A Reporting Entity

These financial statements present the County (the primary government) and its component units, the Pilchuck Development Corporation (“PDC”) and Snohomish County Public Facilities District (“PFD”). The component units are combined and presented in a single column on the government-wide financial statements.

In determining the financial reporting entity, the County complies with the provisions of GASB Statement No. 14, “The Financial Reporting Entity,” GASB Statement No. 39, “Determining Whether Certain Organizations Are Component Units,” and GASB Statement No. 61 “The Financial Reporting Entity: Omnibus”. Accordingly, the County reports as component units those entities where the County appointed a voting majority of the board of directors, and the County is either able to impose its will, or where a financial benefit or burden relationship exists.

The County created the PDC in 1983 to promote and finance industrial development. The Snohomish County Council appoints the Corporation's board of directors. The Corporation may issue industrial revenue bonds to finance industrial development facilities upon approval of the County Council; however, the County has no financial responsibility for such bonds.

Snohomish County established the PFD in July 2001 for the sole purpose of pursuing joint ownership, financing, or operational relationships with any other public agency

36 Notes to the Financial Statements December 31, 2017

within the County for the development of regional center projects and/or with a nonprofit entity for the development of a regional center project at Paine Field. A five-member board of directors appointed by the County Council governs the PFD. The PFD cannot enter into contracts or agreements greater than $50 thousand without Snohomish County Council approval.

The PFD has formalized support for four regional centers: the City of Everett Public Facilities District’s Arena and Parking Garage, the South Snohomish County Public Facilities District’s Regional Convention Center in Lynnwood, the City of Edmonds Public Facilities District’s remodel of the Puget Sound Christian College for use as a Performing Arts and Convention Center, and the Future of Flight in conjunction with Snohomish County Paine Field Airport.

Financial statements for the Pilchuck Development Corporation and Snohomish Public Facilities District can be obtained by writing to the Snohomish County Finance Department, MS 610, 3000 Rockefeller Ave., Everett, WA 98201.

1.B Measurement Focus, Basis of Accounting, and Financial Statement Presentation

Government-Wide Financial Statements The statement of net position and statement of activities present financial information about the County as a whole on a full accrual basis with an economic resource measurement focus. They include all funds except for the agency funds and external investment pool, which are reported separately. The statements distinguish between governmental and business-type activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other non-exchange revenues. Business-type activities are financed in whole or in part by fees charged to external parties for goods or services. Program revenues as reported on the statement of activities include charges to customers and users of goods or services provided by that program, and grants or contributions that are restricted for use by that program. Taxes and other revenues that are not specific to a particular program are reported as general revenues.

The expenses and program revenues of governmental activities are reported on the statement of activities by function/program. Fund financial statements also report governmental fund expenditures by function/program. The County reports the following functions/programs:

General Government - Legislative and administrative services, including expenses for recording and elections, financial services, legislative, personnel administration, administration and facility management.

Judicial - Court system for civil, criminal, and juvenile cases, including jury and witness fees and other judicial and legal costs.

Public Safety - Protection and safety of the citizenry at large, including expenses for law enforcement, fire protection services, inspections and regulatory enforcements, detention and corrections, emergency services and juvenile services.

37 Notes to the Financial Statements December 31, 2017

Physical Environment - Conservation and preservation of the environment.

Transportation - Programs to ensure safe and adequate flow of vehicles and pedestrians in the County, including costs for road and street preservation, construction, and maintenance.

Health and Human Services - Programs that provide prevention, intervention, and rehabilitative human services for County citizens with an emphasis on serving those most in need. They include costs associated with programs such as veterans’ services, mental health, substance abuse prevention and treatment, public health, services for the disabled and aging, homeless services, children’s services, and other general welfare and assistance.

Economic Environment - Community planning and development services, housing programs, and promotion of tourism.

Culture and Recreation - Costs primarily associated with the maintenance and general operations of County parks, trails, natural land and recreational facilities, and fairgrounds, along with other educational and recreational activities for youth, families, and seniors.

Interfund Activity Interfund activity can be classified into two general categories:

• Reciprocal interfund activities are transfers similar to exchange and exchange- like transactions (quasi-external). Interfund services provided and used are reported as revenues in the seller funds and expenditures/expenses in the purchaser funds. • Nonreciprocal interfund activities are nonexchange transactions – no equivalent value is received for the assets transferred and there is no requirement for repayment. They include interfund transfers and interfund reimbursements. Interfund transfers have been eliminated within the governmental activities and business-type activities categories. Transfers between these two activities are reported on the statement of activities. Interfund reimbursements have been eliminated from the statement of activities. See Note 3I for details of interfund balances and transfers.

Fund Financial Statements The fund financial statements individually present major funds and present non-major funds in total. A fund is considered major if it is the primary operating fund of the entity or if its assets plus deferred outflows, liabilities plus deferred inflows, revenues, or expenditures/expenses equal at least 10% of the corresponding total for all funds of that category or type, and at least 5% of the corresponding total for all governmental and enterprise funds combined. Separate financial statements are provided for governmental, proprietary, and fiduciary funds.

The governmental fund financial statements are prepared using a modified accrual accounting basis with a current financial resources measurement focus. The modified accrual basis differs from the full accrual basis in the following ways:

38 Notes to the Financial Statements December 31, 2017

• Purchases of capital assets are considered expenditures. • Redemptions of long-term debt are considered expenditures when due. • Proceeds from long-term debt are considered "other financing sources" when received. • Revenues are recognized as soon as they become both measurable and available to finance expenditures of the current period. Revenues are considered available if received within 60 days, however, grant revenue is recognized when earned. • Interest on long-term debt is not accrued, but is recorded as an expenditure when due. • Accumulated unpaid vacation, sick pay, and other employee benefits are considered expenditures when paid.

The governmental funds are accounted for with a flow of current financial resources measurement focus, which emphasizes the current sources and uses of resources. The County reports the following governmental funds:

The general fund is the primary operating fund of the County. It is used to account for all financial resources except those funds required to be accounted for separately.

Special revenue funds account for revenues which are to be utilized for specific purposes and/or expenditures incurred in the performance of specific activities. Major special revenue funds include the County Road Fund and the Human Services Fund.

• The County Road Fund accounts for the construction, maintenance, and inspection of county streets, roads, and bridges and the design and coordination of countywide public works projects. Revenue is primarily from road and other taxes and from state and federal grants.

• The Human Services Fund is for the administration, planning, development, and provision of the following services: energy and weatherization assistance, long- term care and aging, developmental disabilities, mental health, alcohol and other drug treatment, community services, children and family, housing, homelessness and community development, and veteran's relief. Revenue comes from sales and other taxes, state and federal grants, state and county mandated charges for services, general County revenues, as well as from a tax levy for mental health, developmental disabilities, and veterans’ assistance.

The debt service funds account for the accumulation of resources for the payment of general and special assessment long-term debt.

Capital projects funds account for the resources and expenditures relating to the acquisition and development of capital improvements other than those accounted for in the proprietary funds.

• The Capital Projects Fund is a major fund for 2017 and accounts for major building construction projects that are done throughout the County. Major projects that are currently in progress include renovation of the courthouse and the Carnegie building. Revenues are primarily obtained from bond proceeds.

39 Notes to the Financial Statements December 31, 2017

Proprietary funds are accounted for with a flow of economic resources measurement focus, which emphasizes the measurement of costs and determination of net income. They consist of enterprise fund types and internal service fund types. All assets and all liabilities are reported on the balance sheet. Revenues and expenses are reported on a full accrual basis - revenues are recorded when earned, expenses are recorded when a measurable liability has been incurred. Proprietary funds disclose the composition of cash flows on a separate statement of cash flows. Operating income for the proprietary funds includes all revenues derived in the normal course of operations except for interest and investment earnings, gain or loss on the sale of capital assets, capital grants and contributions, and some miscellaneous non-recurring revenues which are accounted for as non-operating. Operating expenses include all expenses derived in the normal course of operation. Non-operating expenses include interest expense and any other expenses not incurred as a result of the normal operation and purpose of the fund.

Enterprise funds account for operations of business-type activities, which are financed primarily by user charges. The accounting focus is on the measurement of costs and the determination of net income. The County maintains three enterprise funds: solid waste management, airport operation and maintenance, and surface water management.

• The Solid Waste Management Fund, administered by the department of public works, accounts for the operations, capital improvements, and debt service of the County’s solid waste facilities. Revenue comes from the collection of fees at the facilities.

• The Airport Fund accounts for the operations, capital improvements, and debt service of Paine Field, Snohomish County's airport. The fund is supported by fees for services. Additional capital funding is received from federal grants, and bond issues may be used to finance capital improvements.

• The Surface Water Management Fund, administered by the department of public works, accounts for operations relating to the management of storm drainage and surface water. Revenue comes from the collection of charges to property owners.

Internal service funds account for centralized operations related to providing goods or services to various County departments on a cost-reimbursement basis. The County’s internal service funds are presented in the proprietary fund financial statements. In the government-wide financial statements, interfund transactions relating to internal service fund activity have been eliminated. Any residual activity and net position are reported as governmental activities. The County maintains eight internal service funds: equipment rental and revolving fund, information services fund, Snohomish County insurance fund, pits and quarries fund, employee benefit fund, facility services fund, training fund, and the security services fund.

Fiduciary Funds Snohomish County has two major classifications of agency funds: (1) those used with the operations of county government such as clearing accounts; and (2) those which account for cash received and disbursed in the County’s capacity as ex officio treasurer

40 Notes to the Financial Statements December 31, 2017

or collection agent for special districts and other governments such as school districts, water and sewer districts, and fire districts.

Investment Trust Fund is used to report investment activity conducted by the Snohomish County Investment Pool on behalf of legally separate entities that are not part of the County’s primary government.

1.C Assets, Deferred Outflows, Liabilities, Deferred Inflows, and Equity

Cash and Cash Equivalents Cash and cash equivalents include funds held by the County Treasurer, the Washington State Treasurer’s Local Government Investment Pool, and bank accounts not administered by the County Treasurer. These are primarily depository accounts, revolving accounts, and change funds. The Washington State Treasurer’s Local Investment Pool is considered to be cash equivalent as funds held within the pool can be liquidated on demand to meet daily cash flow needs.

Investments The County Investment Pool is classified as investments as the pools average maturity is greater than a year. Additional cash and investment disclosures are presented in Note 3A.

Interfund Receivables and Payables Occasionally, transactions for goods and services between County funds may result in amounts which are due but not yet paid. These are reported as “due to/from other funds” on the balance sheet. Short-term interfund loans are reported as “due to/from other funds.” Long-term interfund loans (non-current portion) are reported as “advances to/ from other funds.”

Receivables Property taxes levied for the current year are recorded as taxes receivable and deferred inflow. As tax payments are collected, the taxes receivable and deferred inflow balances are reduced and revenue is recognized in the fund statements. See Note 3B-Taxes Receivable. Other receivables include amounts due from private individuals and organizations for goods or services rendered.

Amounts reported as due from other governments represent receivables from other governments for goods and services rendered, grant reimbursements, or entitlements. Amounts due for grant reimbursements are recorded in the period in which the authorized disbursements are made.

Inventories and Prepaid Items Governmental funds use the purchase method whereby inventory items are considered expenditures when purchased. Proprietary funds value inventories using average cost method. Certain other purchases representing costs applicable to future accounting periods are recorded as prepaid items in both government-wide and fund financial statements.

41 Notes to the Financial Statements December 31, 2017

Capital Assets Capital assets are recorded at actual cost. Donated capital assets are recorded at acquisition value on the date of donation. Capital costs in the governmental funds are reported as expenditures of the current period in the fund financial statements and as assets in the government-wide financial statements. Individual assets (except infrastructure and software) with a total cost of less than $5 thousand are reported as expenses in the period in which they were incurred. Infrastructure expenditures (roads, bridges, traffic signals, and other public property) and software expenditures in excess of $100 thousand are capitalized and depreciated over their useful life in the government- wide financial statements.

Depreciation of capital assets is reported as an allocated expense in the statement of activities. Depreciation is calculated using the straight-line method based on the estimated useful life of the asset. Generally, buildings and other land improvements are assigned estimated useful lives of 5 to 50 years, machinery and equipment 3 to 20 years, and infrastructure 5 to 60 years. Intangible software has been determined to have an indefinite useful life unless reasonably estimable.

Restricted Assets and Liabilities Restricted assets include cash and investments that are subject to legal restrictions and other assets which are considered to be restricted for a particular purpose such as unspent bond proceeds. Related liabilities are reported as payable from restricted assets.

Investment in Joint Ventures Snohomish County Emergency Radio Systems (SERS), a public nonprofit corporation, was established via an interlocal agreement between the County, nine cities, and a fire district located within the county. Each entity provides a voting member to the SERS board of directors. The purpose of SERS is to develop and maintain a countywide public safety communications system. The County financed its original investment in SERS with general obligation bond proceeds. SERS operations are based on annual assessments from each of its members.

In accordance with generally accepted accounting principles, the investment balance was decreased by $433 thousand in 2017 to reflect the County’s share of SERS revenues and expenditures. SERS financial statements are subject to audit by the Washington State Auditor’s Office and can be obtained by writing to the Snohomish County Finance Department, MS 610, 3000 Rockefeller Ave., Everett, WA 98201.

AHA – Alliance for Housing Affordability: In September 2013, Snohomish County joined the cities of Edmonds, Everett, Granite Falls, Lake Stevens, Lynnwood, Marysville, Mill Creek, Mountlake Terrace, Mukilteo, Snohomish, and the Town of Woodway to establish the Alliance for Housing Affordability (AHA). The agreement was amended in May 2014 to add the City of Arlington and in June 2014 to add the City of Stanwood.

The purpose of AHA is to cooperatively formulate affordable housing goals and policies and to foster efforts to provide affordable housing by providing expertise and information to member jurisdictions. Operating funding is provided by the members.

42 Notes to the Financial Statements December 31, 2017

AHA is governed by a Joint Board composed of an elected official from each member. The Joint Board is responsible for review and approval of all budgetary, financial, policy, and contractual matters. The Board is assisted by an administrative staff housed at the Housing Authority for Snohomish County. Fiscal agent duties are performed by the City of Mountlake Terrace.

Each member is responsible for contributing operating revenues as determined from the AHA annual budget. Contributions from the members are based on each member's population. A grant from the Gates Foundation provided $50 thousand to assist with the first three years of organizational start-up. Snohomish County’s equity share for 2017 is:

AHA’s Total Snohomish County’s Fiscal Year Fiscal Year Snohomish County’s Share as % of Total 7/1/16-6/30/17 Budget Share of Budget AHA Budget 2017 $97,934 $28,212 28.81%

Members withdrawing from the agreement relinquish all rights to any reserve funds, equipment, or material purchased. Upon dissolution, the agreement provides for distribution of net position among the members based on the percentage of the total annual contributions during the period of the Agreement paid by each member.

Additional financial information can be obtained from City of Mountlake Terrace, 6100 219th Street SW, Mountlake Terrace WA 98043, or from Alliance for Housing Affordability, 12711 4th Ave W, Everett, WA 98204.

Snohomish County Police Staff and Auxiliary Services Center (SNOPAC), a special purpose district, was established via an interlocal agreement between Snohomish County, local police, and fire entities (currently 37 members) to jointly establish, maintain and operate a support communications center. SNOPAC takes 911 calls, and performs emergency dispatch services for local governmental agencies including police, fire and medical aid. Control of SNOPAC is with an 11 member Board of Directors consisting of a representative from Snohomish County, the Snohomish County Sheriff, the Everett Police Chief, the Everett Fire Chief, one member from the Fire and Emergency Medical Services Technical Advisory Committee, three members of the Police Technical Advisory Committee and one citizen at large as specified in the Interlocal Agreement. Annual assessments to each of its members are made to cover operational costs.

In the event of the dissolution of SNOPAC, any remaining equity shall be returned to the parties to this Agreement in proportion to their contribution during the fiscal year of dissolution. Had SNOPAC dissolved in 2017, Snohomish County’s share would have been $5.3 million.

Complete financial statements for SNOPAC can be obtained from SNOPAC’s administrative office at 1121 SE Everett Mall Way, Suite 200, Everett, WA 98208.

43 Notes to the Financial Statements December 31, 2017

Deferred Outflows A deferred outflow of resources is a consumption of net position that is applicable to a future reporting period. Deferred outflows include Deferred Loss on Refunding.

Long-Term Debt Long-term debt incurred by the governmental funds is not reported as a liability in the governmental fund financial statements, but is reported in the government-wide statement. The debt proceeds (including any bond premium or discount) are reported as other financing sources and payment of principal, interest, and debt issuance costs are reported as expenditures. Proprietary fund debt is reported on the same basis in both the government-wide and fund financial statements. Bond premiums, discounts, and deferred amounts on refunding are deferred and amortized over the life of the bonds.

Employee Benefits Payable The County’s policies regarding vacation, sick leave and compensatory time permit employees to be compensated for earned but unused vacation leave, compensatory time, and a portion of their sick leave. The liability for such compensated absences in governmental funds is recorded as long-term debt in the government-wide statements. Proprietary fund reporting is the same in both the fund statements and the government- wide statements. The current portion of this debt is estimated based on historical trends. Also see Notes 3G Compensated Absences and 3H Accrued Liabilities.

Pensions For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of all state sponsored pension plans and additions to/deductions from those plans’ fiduciary net position have been determined on the same basis as they are reported by the Washington State Department of Retirement Systems. 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.

Unearned Revenue Unearned revenues are recorded for certain grant related advances and prepaid revenues.

Deferred Inflows A deferred inflow of resources is an acquisition of net position that is applicable to a future reporting period. Deferred inflows are recorded for property taxes, special assessments and deferred gain on refunding. There are differences between certain deferred inflows reported on the fund statements and those reported on the entity-wide statements. Deferred inflows for property taxes and special assessments are reclassified to revenue on the entity-wide statements.

Equity Classifications The government-wide financial statements present equity as net position and are displayed in three components:

• Net investment in capital assets: Consists of capital assets, net of accumulated depreciation and reduced by the outstanding balances of any bonds, mortgages,

44 Notes to the Financial Statements December 31, 2017

notes, or other borrowings that are attributable to the acquisition, construction, or improvement of those assets. • Restricted net position: Consists of net position with constraints placed on the use either by (1) external groups such as creditors, grantors, and contributors; or (2) legal restrictions resulting from constitutional provisions or enabling legislation. • Unrestricted net position: All other net position that does not meet the definition of “restricted” or “net investment in capital assets.”

The governmental funds’ financial statements present equity as fund balance. Fund balance is further classified as nonspendable, restricted, committed, assigned, or unassigned. Unless otherwise directed by the County Council, County Executive, or Director of Finance and committed to writing, resources shall be utilized in the following order: restricted, committed, assigned, and unassigned. Committed fund balance is committed for a specific purpose pursuant to constraints imposed by a formal action such as a County ordinance adopted by the County’s highest level of decision-making authority, the County Council with approval of the County Executive. Similar formal action is required to create, modify, or rescind an ordinance. Assigned fund balance is assigned for a specific purpose pursuant to constraints imposed by a formal action such as a County ordinance adopted by the County’s highest level of decision-making authority, the County Council with approval of the County Executive. No formal action is required to reallocate assigned fund balance. Proprietary fund equity is classified the same as in the government-wide statements.

Note 2 Stewardship, Compliance, And Accountability

2.A Budgetary Data

Budget Policies and Controls In accordance with the Snohomish County Charter, the County Council is required to adopt annual budgets for all budgeted funds for the next fiscal year no later than thirty days prior to the end of the current fiscal year. Each quarter during the fiscal year, the Executive must submit a written report to the Council explaining the relationship between the estimated income and expenses and actual income and expenses to date. If income is estimated to be less than anticipated, the Council may reduce appropriations as necessary to keep expenditures within income. The County Council may also modify the budget on an emergency basis by appropriating contingency funds, revenues received in excess of budgeted revenues, or funds from any other legally available source. All appropriations lapse at the end of the year with the exception of project-length budgets for capital project funds.

The legal level of budgetary control, the level at which expenditures may not legally exceed appropriations, is at the fund/department/program level for all budgeted funds. For example, the Sheriff’s Office’s budget that is included in the General Fund may have multiple programs that cannot be individually exceeded.

Three special revenue funds and one debt service fund were not budgeted for the fiscal year ended December 31, 2017. Per RCW 84.56.020, no budget is required for the Treasurer’s Operations and Maintenance Special Revenue Fund. The Law Library is governed by a Board separate from the County Council. That Board is responsible for

45 Notes to the Financial Statements December 31, 2017

setting and monitoring the Law Library’s annual budget. Due to another entity being separately responsible for the Law Library’s budget, that budget is not included in the County’s annual financial statements. The River Management Fund was not budgeted as there were no expenditures anticipated for 2017. Additionally, the Sno Co Road Improvement Guarantee Fund was closed to the General Fund due to the guaranteed bonds being paid off.

Basis of Budgeting Annual appropriated budgets are adopted for the general, special revenue, debt service, and proprietary funds on the modified accrual basis of accounting. Budgets for capital project funds are adopted at the level of the individual project for fiscal periods that correspond to the lives of the projects. Annual appropriated budgets are adopted at the program level within each fund ("appropriation unit").

Encumbrances An encumbrance system is maintained to account for commitments resulting from approved purchase orders and contracts. All appropriations lapse at the end of the year with the exception of Capital Project Funds. Accordingly, encumbrances outstanding at year-end must be absorbed within budget appropriations for the next year.

2.B Deficit Fund Equity At December 31, 2017 the following internal service funds had a deficit net position:

Internal Service Funds Insurance Fund $24,033,920 Information Services Fund 2,830,577 Facility Services Fund 600,820 Total $27,465,317

The Insurance Fund deficit was due to the actuarial estimates of claims and the implementation of GASB 68. Information Services Fund and Facility Services Fund deficits are due to the implementation of GASB 68.

Note 3 Detail Notes on Transaction Classes/Accounts

The following notes present detail information to support the amounts reported in the basic financial statements for its various assets, liabilities, equity, revenues, and expenditures/expenses.

3.A Deposits and Investments

Deposits The County’s deposits and certificates of deposit are covered by federal depository insurance (FDIC) or by collateral held in a multiple financial institution collateral pool administered by the Washington Public Deposit Protection Commission (PDPC). The PDPC provides protection for public treasurer deposits that exceed the amount insured by FDIC.

46 Notes to the Financial Statements December 31, 2017

Investments It is the policy of the Snohomish County Treasurer (Treasurer) to invest funds in accordance with governing statutes to obtain the highest return possible consistent with the safety and liquidity objectives outlined in investment policy and conforming to all state/local statutes governing the investment of public funds. Among the authorized investments (but not limited to) are U.S. Treasury securities, U.S. Agency Securities, Certificates of Deposit with qualified public depositories, and Washington State Local Government Investment Pool (LGIP). The LGIP portfolio is managed in a manner generally consistent with SEC regulated Rule 2a-7 money market funds. The weighted average maturity of the portfolio will not exceed 60 days.

Investments Measured at Amortized Cost Total Investment Type Investments County Owned State Investment Pool $ 661,291,325 $ 153,373,802 Money Market Investments 11,885,061 7,869,172 Non-negotiable CD's 18,000,000 9,836,317 Total $ 691,176,386 $ 171,079,291

Custodial Credit Risk: This is the risk that in the event of the failure of the counterparty, the County will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. All County securities are held for safekeeping by Wells Fargo, as the County’s agent, in the County’s name.

Interest rate risk: In accordance with its investment policy, the County manages its exposure to investments that are highly sensitive to changes in fair value due to interest rate change by limiting the weighted average of maturity of its investments. In accordance with the policy, 20% of all the County portfolios is comprised of investments maturing within one year. The remainder of the portfolio will not exceed five years in maturity. The average maturity of the portfolio shall not exceed three years.

Fair Value Hierarchy

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 2: These are quoted market prices for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets which are not active, or other quoted prices that are not observable.

Level 3: Unobservable inputs for asset or liability.

47 Notes to the Financial Statements December 31, 2017

Investments Fair Value Level Investment Type Total Level 1 Level 2 Level 3 US Agencies $ 402,316,254 $ - $ 402,316,254 $ - US Treasury Notes (SCIP) 50,106,685 50,106,685 - - Municipal Bonds 78,301,320 - 78,301,320 - Total $ 530,724,259 $ 50,106,685 $ 480,617,574 $ -

Investments are reported at par which is materially equivalent to fair value. It includes monies invested by individual funds and residual cash invested for the benefit of the general fund. As of December 31, 2017, the County held the following investments:

Weighted Average Maturity Investment Type Fair Value Amortized Cost (Years) U.S. Agencies $ 402,316,254 $ - 0.54 U.S. Treasury Notes 50,106,685 - 0.02 Municipal Bonds 78,301,320 - 0.08 Local Government Investment Pool - 661,291,325 Municipal Investor Accounts - 11,885,061 Certificate of Deposit - 18,000,000 Total Fair Value $ 530,724,259 $ 691,176,386

Portfolio Weighted Average Maturity 0.64

Credit risk: Credit risk is related to quality ratings of investments held by the County. State law and County Investment Policy limit the type of investments the County can hold. At year end, the County held obligations of the U.S. Government, U.S. agency issues, the Washington State Local Government Investment Pool, and time certificates of deposit with authorized Washington State banks. The ratings as of December 31, 2017, are:

Investment Fair Value Amortized Cost S&P Rating Local Government Investment Pool $ - $ 661,291,325 Not Subject Municipal Investor Accounts - 11,885,061 Not Subject Certificate of Deposits - 18,000,000 Not Subject Municipal Bonds 78,301,320 - Investment Grade U.S. Treasury Notes (SCIP) 50,106,685 - AAA Federal Agency - FFCB 14,935,400 - AAA Federal Agency - FHLB 106,939,214 - AAA Federal Agency - FHLMC 181,118,583 - AAA Federal Agency - FNMA 99,323,057 - AAA Total $ 530,724,259 $ 691,176,386

48 Notes to the Financial Statements December 31, 2017

Concentration of credit risk: Concentration risk is the risk of loss attributed to the magnitude of a government’s investment in a single issuer. It is the policy of Snohomish County to diversify its investment portfolios. To eliminate risk of loss resulting from the over-concentration of assets in a specific maturity, issuer or class of securities, all cash and cash equivalent assets in all funds shall be diversified by maturity, issuer and by the class of security. Detail information on concentration risk is covered in the Snohomish County Investment Policy.

Percent of Investment Fair Value Amortized Cost Portfolio U.S. Agencies $ 402,316,254 $ - 32.9% U.S. Treasury Notes (SCIP) 50,106,685 - 4.1% Municipal Bonds 78,301,320 - 6.4% Local Government Investment Pool - 661,291,325 54.1% Municipal Investor Accounts - 11,885,061 1.0% Certificates of Deposit - 18,000,000 1.5% Total $ 530,724,259 $ 691,176,386 100.0%

Investment Pool The Snohomish County Investment Pool, SCIP, is not registered with the SEC. Investments are reported at fair value to pool participants. It includes participating funds from the County’s primary government, funds from the districts where the County Treasurer serves as ex-officio treasurer and cities where the County Treasurer is the property tax collector. There are no involuntary participants in the SCIP. All participants have notified the Treasurer of their desire to participate in SCIP. The portion of the pool belonging to outside districts is reported in an Investment Trust Fund. SCIP investments are those allowed by County Investment Policy and include savings accounts, CD’s and securities.

Fair value of securities is based on the market value reports provided by the County’s custodial agent. The market values are uploaded into the county investment software monthly from the custodial agent. The fair value of each participants’ investment is determined by calculating the ratio of total investments by pool participants divided into the total fair value of all SCIP underlying assets. Each pool participant can determine their fair value by taking their investment in SCIP times this ratio.

Pool participant shares are based on the dollars that they have invested in SCIP. The income is distributed based on interest rates on investments, amortization of premiums and discounts, and realized gains and losses for the month.

Pool oversight comes from the Snohomish County Finance Committee (SCFC). The SCFC consists of the County Treasurer, County Executive and Chairman of the County Council. SCFC approves investment policies for SCIP.

The Primary Government has $292 million invested in the SCIP. The change in fair value of the SCIP for the Primary Government at December 31, 2017 is ($1.8 million).

49 Notes to the Financial Statements December 31, 2017

Condensed Statement of Net Position External Internal Total Assets $ 242,394,563 $ 291,961,032 $ 534,355,595 Equity of pool participants 242,394,563 291,961,032 534,355,595

Condensed Statement of Changes in Net Position External Internal Total Net Position January 1, 2017 $ 250,052,755 $ 256,693,069 $ 506,745,824 Net Change in Investments (7,658,192) 35,267,963 27,609,771 Net Position December 31, 2017 $ 242,394,563 $ 291,961,032 $ 534,355,595

FMV Change (1,496,426) (1,802,426) (3,298,852)

3.B Taxes Receivable

Taxing Authority The County is authorized to levy both “regular” property taxes and “excess” property taxes. Regular property taxes are subject to limitations as to rates and amounts, and are imposed for general municipal purposes, including the payment of debt service on limited tax general obligation bonds. The County also may impose “excess” property taxes that are not subject to limitation when authorized by a 60% majority popular vote, as provided in Article VII, Section 2, of the State Constitution and Revised Code of Washington (RCW), RCW 84.52.052. To be valid, such popular vote must have a minimum voter turnout of 40% of the number who voted at the last County general election, except that one-year excess tax levies also are valid if the turnout is not less than 24% of the number who voted at the last County general election. Excess levies may be imposed without a popular vote when necessary to prevent the impairment of the obligation of contracts.

Property Tax Rates and Limitations The Washington State Constitution and Washington State law (RCW 84.55.010) allow counties to limit the rate of property taxes. A county may levy taxes at a maximum rate of $1.80 per $1,000 of assessed value against all real and personal property subject to taxation for general county purposes. This includes payment of principal and interest on bonds issued by the County without a vote of the people, including limited tax general bond obligations (RCW 84.52). The County’s regular levy for 2017 was $.84 per $1,000 on an assessed valuation of $105 billion for a total regular tax levy of $88.6 million.

The County is also authorized to levy $2.25 per $1,000 of assessed valuation in unincorporated areas for road construction and maintenance. This levy is subject to the same limitations as the levy for general government services. The County’s road levy for 2017 was $1.42 per $1,000 on assessed valuation of $43.8 billion for a total road levy of $62.3 million.

A county may increase its levy from $1.80 to $2.48 for general county purposes if the total levies for both county and road purposes do not exceed $4.05 per $1,000 of

50 Notes to the Financial Statements December 31, 2017

assessed value and no other taxing district has had its levy reduced as a result of the increased county levy.

The $1.80 per $1,000 limitation on the general purposes levy is exclusive of certain regular property taxes: (i) a voted levy for emergency medical services, limited to $0.50 per $1,000 (authorized by RCW 84.52.069); (ii) a voted levy to finance affordable housing for very low income households, limited to $0.50 per $1,000 (authorized by RCW 84.52.105); and (iii) a non-voted levy for conservation futures, limited to $0.0625 per $1,000 (authorized by RCW 84.34.230). The County currently is levying $0.04 per $1,000 for conservation futures.

Aggregate regular property tax levies by the State and all taxing districts except port districts and public utility districts are subject to a rate limitation of 1% of the true and fair value of property (or $10.00 per $1,000) by Article VII, Section 2 of the State Constitution and by RCW 84.52.050. Within the 1% limitation, aggregate regular property tax levies by all taxing districts except the State, port districts and public utility districts are subject to a rate limitation of $5.90 per $1,000 of assessed value (or 0.59%) by RCW 84.52.043(2). This limitation is exclusive of levies for emergency medical services, affordable housing for very low-income households and acquiring conservation futures. If aggregate regular property tax levies exceed the 1% or $5.90 per $1,000 limitations, levies requested by “junior” taxing districts within the area affected are reduced or eliminated according to a detailed prioritized list (RCW 84.52.010), in order to bring the aggregate levy into compliance. Junior taxing districts are defined by RCW 84.52.043 as all taxing districts other than the State, counties, cities, towns, road districts, port districts, and public utility districts.

Property Tax Calendar The County Treasurer acts as an agent to collect property taxes levied in the county for all taxing authorities. The following is an annual timeline for tax collections:

Property Tax Calendar Taxes are levied and become an enforceable lien January 1 against properties. February 14 Tax bills are mailed.

April 30 First of two equal installment payments is due. Assessed value of property established for next May 31 year’s levy at 100% of market value. October 31 Second installment is due.

Property taxes are recorded as a receivable and deferred inflow when levied. Property tax collections are recorded as a reduction of the receivable. Also, upon collection, the related deferred inflow is reclassified to revenue, on the modified accrual basis. For the statement of activities, property taxes are revenue in the year they are levied. No allowance for uncollectible taxes is established because delinquent taxes are considered fully collectible. Prior year tax levies were recorded using the same principle, and delinquent taxes are evaluated annually.

51 Notes to the Financial Statements December 31, 2017

Property Tax Levy Procedures In the State of Washington, the county assessor (the “Assessor”) determines the value of all real and personal property throughout the county that is subject to ad valorem taxation. The Assessor’s duties and methods of determining value are prescribed and controlled by statute and by detailed regulations promulgated by the Department of Revenue of the State of Washington. For tax purposes, the assessed value of property is set at 100% of its actual value. All property is subject to revaluation every year. The Assessor lists the property on a tax roll at its current assessed value and the tax roll is filed in the Assessor’s office.

The Assessor’s determinations are subject to revision by the County Board of Equalization and, for certain property, subject to further revision by the State Board of Equalization. After all administrative procedures are completed, the County receives the Assessor’s final certificate of assessed value of property within the county.

Property taxes are levied in specific amounts, and the rates for all taxes levied for all taxing districts in the county (including the County) are determined, calculated, and fixed by the Assessor based upon the assessed valuation of the property within the various taxing districts. The Assessor extends the taxes to be levied within each taxing district upon a tax roll, which contains the total amount of taxes to be levied and collected. The tax roll is delivered to the County Treasurer by January 15 of each year, and an abstract of the tax roll showing the total amount of taxes collectible in each of the taxing districts for the year, is delivered to the County Auditor at the same time. The Treasurer creates a tax account for each taxpayer and is responsible for the collection of taxes due on each account. All such taxes are due and payable on the 30th of April of each year, but if the amount due from a taxpayer exceeds $50, one-half may be paid then, and the balance no later than October 31 of that year.

The method of giving notice of payment of taxes due, the Treasurer’s accounting for the money collected, the division of the taxes among the various taxing districts, notices of delinquency, and collection procedures are all covered by detailed statutes.

Tax Liens and Foreclosure Property taxes, and all charges and expenses relating to the taxes, constitute a statutory lien on the property taxed. The lien attaches to the property, from and including January 1 in the year in which the tax is levied, and is discharged only when the taxes are paid. By law, the Treasurer may commence foreclosure of a tax lien on real property after three years have passed since the first delinquency. The County Treasurer may commence foreclosure proceedings in Superior Court upon all tax liens embraced by the certificate of delinquency. The County Treasurer must immediately sell the property to the highest and best bidder for cash upon entry of the order of foreclosure. The minimum bid allowable is the total amount of the taxes, interest, penalty, and costs due. To the extent property is stricken to the County at a foreclosure sale, that property is exempt from taxation for so long as the County holds it. A property owner may redeem their property at any time prior to the foreclosure sale by paying the County Treasurer the amount of the certificate of delinquency and all taxes, interest, and costs accruing after the certificate of delinquency is issued.

52 Notes to the Financial Statements December 31, 2017

3.C Other Receivables

Other receivables consist primarily of customer accounts receivable. These are reported net of allowance for uncollectible accounts as follows:

Other Receivables As of December 31, 2017

Governmental Business-type Total Primary Activities Activities Government Other Receivables $ 68,227,542 $ 4,751,357 $ 72,978,899 Allowance for Uncollectibles (53,736,285) (1,083,989) $ (54,820,274) Other Receivables, Net $ 14,491,257 $ 3,667,368 $ 18,158,625

3.D Capital Assets

The following is a summary of changes in capital assets for the County primary government:

CAPITAL ASSETS For the year ended December 31, 2017

Beginning Ending Balance Increases Decreases Balance Governmental Activities: Capital assets not depreciated: Land $ 298,995,761 $ 12,978,682 $ (27,997,102) $ 283,977,341 Construction in progress 40,951,874 27,447,151 (9,846,948) 58,552,077 Total capital assets not depreciated 339,947,635 40,425,833 (37,844,050) 342,529,418

Other capital assets: Buildings 280,877,324 - (268,400) 280,608,924 Other improvements 106,654,154 4,777,830 (416,949) 111,015,035 Equipment 96,586,159 9,701,594 (7,517,722) 98,770,031 Infrastructure 1,147,184,158 57,404,140 (610,326) 1,203,977,972 Intangible assets 14,120,335 162,558 - 14,282,893 Total other capital assets at historical cost 1,645,422,130 72,046,122 (8,813,397) 1,708,654,855

Less accumulated depreciation for: Buildings (121,278,746) (7,145,543) 107,354 (128,316,935) Other improvements (50,040,775) (4,996,674) 301,806 (54,735,643) Equipment (56,321,961) (5,689,597) 5,555,254 (56,456,304) Infrastructure (498,447,864) (38,893,288) 576,855 (536,764,297) Intangible assets (3,223,316) (660,782) - (3,884,098) Total accumulated depreciation (729,312,662) (57,385,884) 6,541,269 (780,157,277) Other capital assets, net 916,109,468 14,660,238 (2,272,128) 928,497,578

Governmental activities capital assets, net $ 1,256,057,103 $ 55,086,071 $ (40,116,178) $ 1,271,026,996

53 Notes to the Financial Statements December 31, 2017

CAPITAL ASSETS For the year ended December 31, 2017

Beginning Ending Balance Increases Decreases Balance Business-type Activities Capital assets not depreciated: Land $ 44,628,137 $ 486,997 $ (25,086) $ 45,090,048 Construction in progress 20,980,175 7,046,206 (16,614,753) 11,411,628 Total capital assets not depreciated 65,608,312 7,533,203 (16,639,839) 56,501,676

Other capital assets: Buildings 150,748,321 304,334 - 151,052,655 Other improvements 86,889,882 - - 86,889,882 Equipment 14,410,699 4,044,085 (171,345) 18,283,439 Infrastructure 179,159,215 23,782,342 - 202,941,557 Intangible assets 3,388,162 - - 3,388,162 Total other capital assets at historical cost 434,596,279 28,130,761 (171,345) 462,555,695

Less accumulated depreciation for: Buildings (51,782,826) (3,943,728) - (55,726,554) Other improvements (44,808,080) (3,150,126) - (47,958,206) Equipment (6,295,537) (935,937) 171,345 (7,060,129) Infrastructure (97,980,226) (4,809,385) - (102,789,611) Intangible assets (2,591,510) (193,344) - (2,784,854) Total accumulated depreciation (203,458,179) (13,032,520) 171,345 (216,319,354) Other capital assets, net 231,138,100 15,098,241 - 246,236,341

Business-type activities capital assets, net $ 296,746,412 $ 22,631,444 $ (16,639,839) $ 302,738,017

Changes to assets and accumulated depreciation may appear skewed due to reclassification of assets between categories.

Depreciation Amounts posted in the accumulated depreciation account include retirement of assets sold or transferred and current period depreciation expense. Amounts of depreciation expense charged to capital assets by function are as follows:

54 Notes to the Financial Statements December 31, 2017

Depreciation Expense For the Year Ended December 31, 2017

Governmental Activities General Government $ 7,511,059 Judicial 2,724,506 Public Safety 2,168,757 Physical Environment 32,519 Transportation 40,730,864 Health and Human Services 8,691 Economic Environment 11,886 Culture and Recreation 4,197,602 Total Governmental Activities 57,385,884

Business-type Activities Airport 7,395,824 Solid Waste Management 3,592,400 Surface Water Management 2,044,296 Total Business-type Activities 13,032,520

Total Primary Government $ 70,418,404

3.E Short-Term Debt

The County had no short-term debt during or at the end of 2017.

3.F Long-Term Debt

The County’s long-term debt consists primarily of general obligation bonds, Washington State public works trust fund loans, and Community Economic Revitalization Board loans.

The following table summarizes the long-term debt issued and outstanding as of December 31, 2017:

55 Notes to the Financial Statements December 31, 2017

2017 Schedule of Long Term Debt Beginning 2017 Ending Original Issue Outstanding Redemptions Outstanding Scheduled 2018 Interest Purpose Amount * Balance (Additions) Balance Payoff Date Redemption Rate Governmental Activities

1997 Bond Issue Memorial Stadium Series B $ 1,134,775 $ 1,134,775 $ - $ 1,134,775 2026 $ - 4.5-6.0%

2009B Bond Issue Animal Shelter 3,376,502 2,410,641 154,458 2,256,183 2028 161,837 2.0-5.0% Facilities HVAC 2,144,566 1,204,691 151,155 1,053,536 2023 157,201 2.0-5.0% Total 2009B Issue 5,521,068 3,615,332 305,613 3,309, 719 319,038

2010A Bond Issue 800 MHZ Radio Project Phase 2 - Rfndg 8,708,214 4,415,307 828,394 3,586,913 2021 848,984 3.0-4.3% Parks - Rfndg 4,102,635 2,080,147 390,271 1,689,876 2021 399,974 3.0-4.3% County Campus Redevelopment - Rfndg 98,799,570 84,199,139 2,975,244 81,223,895 2035 3,048,924 3.0-4.3% Total 2010A Issue 111,610,419 90,694,593 4,193,909 86,500,684 4,297,882

2010B Bond Issue Roads 3,932,708 2,919,692 178,406 2,741,286 2030 181,570 1.0-5.9% Fairgrounds 7,058,844 5,764,366 231,632 5,532,734 2040 232,138 1.0-5.9% Emergeny Operations Center 2,218,448 1,795,940 74,962 1,720,978 2035 76,292 1.0-5.9% Total 2010B Issue 13,210,000 10,479,998 485,000 9,994, 998 490,000

2011A Bond Issue Memorial Stadium - Rfndg 2,755,000 760,000 355,000 405,000 2018 405,000 2.0-5.0%

2011B Bond Issue Auditor Equipment - Rfndg 2,315,000 420,000 420,000 - 2017 - 2.0-5.0% Gun Range - Rfndg 475,000 285,000 45,000 240,000 2022 45,000 2.0-5.0% County Campus Redevelopment - Rfndg 37,875,000 37,075,000 180,000 36,895,000 2036 180,000 2.0-5.0% Total 2011B Issue 40,665,000 37,780,000 645,000 37,135,000 225,000

2011C Bond Issue Cathcart - Refunding 23,725,000 17,205,000 1,775,000 15,430,000 2025 1,820,000 0.5-3.6%

2012A Bond Issue County Campus Redevelopment - Rfndg 2,495,000 2,055,000 155,000 1,900,000 2027 160,000 2.0-4.0% Park Imprvmnts/Willis Tucker Park - Rfndg 1,160,000 845,000 110,000 735,000 2023 110,000 2.0-4.0% Facilities Projects 12 yr 1,810,000 1,290,000 140,000 1,150,000 2024 145,000 2.0-4.0% Facilities Projects 20 yr 3,610,000 3,090,000 145,000 2,945,000 2032 150,000 2.0-4.0% Total 2012A Issue 9,075,000 7,280,000 550,000 6,730,000 565,000

2013 Bond Issue Justice Center 73,730,000 73,730,000 - 73,730,000 2043 20,000 3.0-5.0% Sheriff Precinct 2,765,000 2,545,000 80,000 2,465,000 2037 80,000 3.0-5.0% Conservations Futures 22,470,000 22,470,000 - 22,470,000 2032 1,115,000 3.0-5.0% Roads 4,710,000 4,170,000 190,000 3,980,000 2032 200,000 3.0-5.0% Parks 3,285,000 2,605,000 240,000 2,365,000 2032 250,000 3.0-5.0% Sheriff Laptops 925,000 385,000 190,000 195,000 2018 195,000 3.0-5.0% Total 2013 Issue 107,885,000 105,905,000 700,000 105,205,000 1,860,000

2015 Bond Issue Memorial Stadium - Rfndg 427,671 423,911 3,139 420,772 2027 3,296 3.0-5.0% Fairgrounds Property - Rfndg 339,941 307,976 17,006 290,970 2030 9,658 3.0-5.0% Sheriff Storage/Gun Range - Rfndg 261,493 236,905 13,082 223,823 2030 7,429 3.0-5.0% County New Admin Building - Rfndg 1,961,150 1,776,744 98,113 1,678,631 2030 55,716 3.0-5.0% Existing Admin Building Rmdl - Rfndg 2,087,055 1,890,773 102,462 1,788,311 2030 60,751 3.0-5.0% Mission Building - Rfndg 326,866 296,131 16,353 279,778 2030 9,286 3.0-5.0% Other Campus Remodel Projects - Rfndg 653,733 592,262 32,705 559,557 2030 18,572 3.0-5.0% County Campus Redvlpmnt - Jail - Rfndg 1,242,091 1,125,297 62,140 1,063,157 2030 35,287 3.0-5.0% GTE Building - Rfndg 401,661 141,699 141,699 - 2017 - 3.0-5.0% Conservation Futures - Rfndg 4,967,645 1,752,493 1,752,493 - 2017 - 3.0-5.0% Various County Rmdl/Bldg Projects - Rfndg 367,861 367,861 - 367,861 2019 180,848 3.0-5.0% Snohomish County Radio Project - Rfndg 1,414,936 906,928 271,614 635,314 2019 308,331 3.0-5.0% City of Edmonds Radio Project - Rfndg 472,051 295,351 93,975 201,376 2019 98,119 3.0-5.0% City of Lynnwood Radio Project - Rfndg 571,631 366,075 108,951 257,124 2019 125,536 3.0-5.0% City of Marysville Radio Project - Rfndg 381,842 238,909 76,017 162,892 2019 79,368 3.0-5.0% City of Mill Creek Radio Project - Rfndg 144,093 90,155 28,686 61,469 2019 29,951 3.0-5.0% City of Mtlk Terrace Radio Project - Rfndg 112,319 101,195 4,554 96,641 2019 47,598 3.0-5.0% City of Woodway Radio Project - Rfndg 19,354 12,110 3,854 8,256 2019 4,023 3.0-5.0% Fire District No. 1 Radio Project - Rfndg 115,750 111,762 387 111,375 2019 55,032 3.0-5.0% Snocom 800 MHz/Edmonds - Rfndg 129,189 80,830 25,719 55,111 2019 26,853 3.0-5.0% Snocom 800 MHz/Mtlk Terrace - Rfndg 68,865 43,088 13,710 29,378 2019 14,314 3.0-5.0% Snocom 800 MHz/Other - Rfndg 288,803 180,695 57,494 123,201 2019 60,028 3.0-5.0% PW Cathcart Roads - Rfndg 2,569,971 2,388,633 189,717 2,198,916 2026 199,466 3.0-5.0% PW Cathcart Fleet - Rfndg 3,627,218 3,371,280 267,764 3,103,516 2026 281,524 3.0-5.0% Sheriff Gun Range/Impound Lot - Rfndg 1,100,857 1,023,180 81,266 941,914 2026 85,442 3.0-5.0% Roads - Rfndg 13,481,099 12,563,830 997,800 11,566,030 2026 1,050,885 3.0-5.0% Total 2015 Issue 37,535,145 30,686,073 4,460,700 26,225,373 2,847,313

Total G.O. Bonds - Governmental Activities 353,116,407 305,540,771 13,470,222 292,070,549 12,829,233

56 Notes to the Financial Statements December 31, 2017

2017 Schedule of Long Term Debt Beginning 2017 Ending Original Issue Outstanding Redemptions Outstanding Scheduled 2018 Interest Purpose Amount * Balance (Additions) Balance Payoff Date Redemption Rate Public Works Trust Fund Loans Relocate Road Away from River 500,000 54,034 27,018 27,016 2018 27,018 1.0% Granite Falls Alternate Route 7,000,000 4,421,053 368,421 4,052,632 2028 368,421 1.0% Total PWTF Loans 7,500,000 4,475,087 395,439 4,079,648 395,439

Other Loans Airport CERB Loan 468,214 468,214 31,214 437,000 2030 31,214 0.0%

Total Debt - Governmental Activities $ 361,084,621 $ 310,484,072 $ 13,896,875 $ 296,587,197 $ 13,255,886

Business-Type Activities

2009A Bond Issue Surface Water - 2001 Rfndg $ 11,075,000 $ 4,885,000 $ 900,000 $ 3,985,000 2021$ 935,000 3.0-5.0% Surface Water - 2006 Rfndg 2,745,000 1,220,000 225,000 995,000 2021 230,000 3.0-5.0% Total 2009A Issue 13,820,000 6,105,000 1,125,000 4,980,000 1,165,000

2009B Bond Issue Solid Waste 4,204,079 2,361,601 296,315 2,065,286 2023 308,168 2.0-5.0% Airport - Private 2,331,885 1,620,343 104,369 1,515,974 2028 108,545 2.0-5.0% Airport - Public 297,968 212,725 13,702 199,023 2028 14,250 2.0-5.0% Total 2009B Issue 6,833,932 4,194,669 414,386 3,780,283 430,963

2010A Bond Issue Airport Debt Service 20 Year - Rfndg 8,003,197 6,820,410 241,091 6,579,319 2035 247,118 3.0-4.3%

2010C Bond Issue Airport 2009 BAN - Rfndg 4,950,000 4,125,000 155,000 3,970,000 2035 160,000 2.0-4.4%

2011B Bond Issue Paine Field Various - Rfndg 1,775,000 1,535,000 55,000 1,480,000 2036 55,000 2.0-5.0% Solid Waste Facility Construction - Rfndg 12,175,000 7,215,000 1,095,000 6,120,000 2022 1,130,000 2.0-5.0% Paine Field Museum - Rfndg 20,555,000 17,800,000 615,000 17,185,000 2036 630,000 2.0-5.0% Total 2011B Issue 34,505,000 26,550,000 1,765,000 24,785,000 1,815,000

2012B Bond Issue Airport 30,815,000 25,780,000 1,340,000 24,440,000 2032 1,365,000 2.0-3.6% Solid Waste 7,860,000 6,925,000 250,000 6,675,000 2037 255,000 2.0-3.6% Total 2012B Issue 38,675,000 32,705,000 1,590,000 31,115,000 1,620,000

2015 Bond Issue Airport (97, C-3, C-5) 1,689,000 595,849 595,849 - 2017 - 3.0-5.0% Surface Water Projects 55,266 46,064 9,201 36,863 2021 9,199 3.0-5.0% Various Airport Projects 5,069,736 4,712,013 374,252 4,337,761 2026 393,482 3.0-5.0% Total 2015 Issue 6,814,002 5,353,926 979,302 4,374,624 402,681

Total G.O. Bonds - Business-Type Activities 113,601,131 85,854,005 6,269,779 79,584,226 5,840,762

Public Works Trust Fund Loans Recycling & Transfer Station Construction 10,000,000 3,176,472 529,412 2,647,060 2022 529,412 0.5% Recycling & Transfer Station Construction 1,000,000 263,157 52,632 210,525 2021 52,632 0.5% Recycling & Transfer Station Reconstruction 10,000,000 2,249,122 562,281 1,686,841 2020 562,281 1.0% Total PWTF Loans 21,000,000 5,688,751 1,144,325 4,544,426 1,144,325

Community Economic Revitalization Board Airport CERB Loan 1,700,000 1,578,571 121,428 1,457,143 2030 121,429 2.0% Airport CERB Loan 496,257 496,257 - 496,257 2033 - 2.0% Total Other Loans 2,196,257 2,074,828 121,428 1,953,400 121,429

Total Debt - Business-Type Activities $ 136,797,388 $ 93,617,584 $ 7,535,532 $ 86,082,052 $ 7,106,516

* Original issue amounts for PWTFL and CERB loans are adjusted to reflect additional loan draws

57 Notes to the Financial Statements December 31, 2017

The following table summarizes the changes in long-term debt during 2017:

Changes in Long-term Debt For the Year Ended December 31, 2017

Beginning Ending Current Non-Current Balance Additions Reductions Balance Portion Portion Governmental Activities: General Obligation Bonds $ 305,540,771 $ - $ 13,470,222 $ 292,070,549 $ 12,829,233 $ 279,241,316 Loans Payable 4,943,301 - 426,653 4,516,648 426,653 4,089,995 Total Bonds, Notes, and Loans Payable 310,484,072 - 13,896,875 296,587,197 13,255,886 283,331,311 Net Premiums/Discounts 16,920,051 - 1,350,637 15,569,414 1,229,676 14,339,738 Total Governmental Activities Debt $ 327,404,123 $ - $ 15,247,512 $ 312,156,611 $ 14,485,562 $ 297,671,049

Business-type Activities: G.O. Bonds/Solid Waste $ 16,501,601 $ - $ 1,641,315 $ 14,860,286 $ 1,693,168 $ 13,167,118 G.O. Bonds/Airport 63,201,340 - 3,494,263 59,707,077 2,973,395 56,733,682 G.O. Bonds/Surface Water 6,151,064 - 1,134,201 5,016,863 1,174,199 3,842,664 Loans Payable/Solid Waste 5,688,751 - 1,144,325 4,544,426 1,144,325 3,400,101 Loans Payable/Airport 2,074,828 - 121,428 1,953,400 121,429 1,831,971 Total Bonds, Notes, and Loans Payable 93,617,584 - 7,535,532 86,082,052 7,106,516 78,975,536 Net Premiums/Discounts 2,927,575 - 322,763 2,604,812 322,764 2,282,048 Total Business-type Activities Debt $ 96,545,159 $ - $ 7,858,295 $ 88,686,864 $ 7,429,280 $ 81,257,584

Total Primary Government: $ 423,949,282 $ - $ 23,105,807 $ 400,843,475 $ 21,914,842 $ 378,928,633

Debt service requirements at December 31, 2017 are as follows:

Debt Service Requirements For the Year Ended December 31, 2017

Governmental Activities General Obligation Other Debt Principal Interest Principal Interest 2018 $ 12,829,233 $ 12,038,882 $ 426,653 $ 20,533 2019 12,994,292 11,916,352 399,635 18,421 2020 12,666,904 11,483,563 399,635 16,579 2021 13,310,073 11,016,425 399,635 14,737 2022 12,575,139 10,464,721 399,635 12,895 2023-2027 68,325,113 43,487,207 1,998,175 36,842 2028-2032 70,759,795 26,690,499 493,280 1,842 2033-2037 53,870,000 12,693,770 - - 2038-2042 28,040,000 4,854,160 - - 2043 6,700,000 268,000 - - Total $ 292,070,549 $ 144,913,579 $ 4,516,648 $ 121,849

58 Notes to the Financial Statements December 31, 2017

Debt Service Requirements For the Year Ended December 31, 2017

Busine ss-Type Activitie s Solid Waste Airport Surface Water Other Debt Principal Interest Principal Interest Principal Interest Principal Interest 2018 $ 1,693,168 $ 563,685 $ 2,973,395 $ 2,158,655 $ 1,174,199 $ 234,868 $ 1,265,754 $ 60,299 2019 1,755,494 501,059 3,062,435 2,065,484 1,219,198 192,133 1,265,754 103,594 2020 1,823,314 436,039 3,166,138 1,969,329 1,279,233 131,173 1,301,200 48,301 2021 1,889,980 365,073 3,265,309 1,867,294 1,344,233 67,212 738,920 36,630 2022 1,967,477 290,699 3,383,867 1,753,354 686,288 30,583 2023-2027 1,890,853 844,318 18,195,727 6,866,215 - - 784,378 92,616 2028-2032 1,755,000 574,050 18,205,206 3,598,189 - - 420,093 21,466 2033-2037 2,085,000 236,985 7,455,000 719,163 - - 35,439 709 Total $ 14,860,286 $ 3,811,908 $ 59,707,077 $ 20,997,683 $ 5,016,863 $ 625,386 $ 6,497,826 $ 394,198

Debt Limitation Voted Debt - The County may issue general obligation bonds for general county purposes in an amount not to exceed 2.5% of the assessed value of all taxable property. Unlimited tax general obligation bonds require an approving vote, and any election to validate general obligation bonds must have a voter turnout of at least 40% of those who voted in the last State general election. Of those voting, 60% must be in the affirmative. The principal and interest on voted general obligation bonds is payable from property taxes in excess of regular property taxes, without limitation as to rate or amount.

Non-voted Debt - The County Council may, by ordinance, authorize the issuance of limited tax general obligation bonds in an amount up to 1.5% of the assessed valuation within the County without authorization of the voters. No combination of limited and unlimited tax bonds may exceed 2.5% of the assessed valuation. The principal and interest on non-voted debt is payable from regular property tax levies or from other available revenues of the County.

The computation of the County’s general obligation debt capacity is displayed in the statistical section of this report.

Arbitrage The County issues tax-exempt bonds that are subject to IRS arbitrage regulations. The County contracts with a consultant to analyze arbitrage requirements. For the year ended December 31, 2017, there is no arbitrage liability.

3.G Compensated Absences

The compensated absences liability attributable to the governmental activities will be liquidated primarily by the general fund.

59 Notes to the Financial Statements December 31, 2017

Compensated Absences For the Year Ended December 31, 2017

Beginning Ending Amounts Due Balance Earned Use d Balance Within One Year

Governmental Activities $18,030,172 $ 25,562,927 $(24,887,459) $18,705,640 $ 187,056

Business-type Activities Solid Waste $ 700,873 $ 993,567 $ (987,679) $ 706,761 $ 7,068 Airport 419,470 697,267 (667,380) 449,357 4,494 Surface Water 497,868 925,674 (908,154) 515,388 5,154 Subtotal Business-type 1,618,211 2,616,508 (2,563,213) 1,671,506 16,716 Total Primary Government $19,648,383 $ 28,179,435 $(27,450,672) $20,377,146 $ 203,772

3.H Accrued Liabilities

The County’s accrued liabilities include the following:

Accrued Liabilities As of December 31, 2017

Governmental Business-type Total Primary Activities Activities Government Retainage Payable $ 750,269 $ 261,018 $ 1,011,287 Interest Payable 3,642,310 320,916 3,963,226 Wages Payable 4,928,467 514,818 5,443,285 Taxes Payable 44,849 733,069 777,918 Customer Deposits 1,629,093 703,801 2,332,894 Custodial Accounts 340,122 19,765 359,887 Other 1,937 - 1,937 Total $ 11,337,047 $ 2,553,387 $ 13,890,434

3.I Interfund Balances and Transfers

There is $5 million in liquidity loans between the Human Services Fund and the Capital Projects Fund. Additionally, there is a 2 million liquidity loan between an Other Governmental Fund and an Internal Service Fund. These amounts have been eliminated for the government-wide.

Transfers represent subsidies and contributions provided to operating funds and capital project funds with no corresponding debt or promise to repay. Most recurring transfers are for the purpose of funding debt service payments. Transfers for general operating purposes and transfers of assets are also done on a routine basis. The following table summarizes the transfers made between funds and activities:

60 61 Notes To The Financial Statements December 31, 2017

Schedule of Transfers For the Year Ended December 31, 2017

Disbursing Funds Receiving Funds Governmental Funds Proprietary Funds Governmental Business-type Activities Activities Subtotal Total Fund Human Other Total Business- Full Statements - General County Road Services Governmental Governmental Airport Surface type Internal Service Accrual Transfers Fund Fund Fund Funds Funds Fund Water Fund Activities Funds Activity* Out Governmental Funds General Fund $ - $ 63,570 $2,531,332 $ 3,791,938 $ 6,386,840 $ 350,148 $ - $ 350,148 $ - $ - $ 6,736,988 County Road Fund 4,317,569 - 112,000 2,533,410 6,962,979 - 601,581 601,581 - - 7,564,560 Human Services Fund - - - 761,746 761,746 - - - - - 761,746 Capital Projects Fund - - - 3,468,380 3,468,380 - - - - - 3,468,380 Other Governmental Funds 1,216,480 3,317,525 - 25,665,339 30,199,344 - 856,328 856,328 - - 31,055,672 Total Governmental Funds 5,534,049 3,381,095 2,643,332 36,220,813 47,779,289 350,148 1,457,909 1,808,057 - - 49,587,346

Proprietary Funds Business-type Activities Solid Waste Fund ------339,667 - 339,667 Surface Water Fund 207,220 30,000 - - 237,220 - - - - - 237,220 Subtotal Business-type Activities 207,220 30,000 - - 237,220 - - - 339,667 - 576,887 Governmental Activities Internal Service Funds - - - 3,446,209 3,446,209 - - - 23,241 750 3,470,200

Full Accrual Activity* ------315,794 - 315,794

Total Fund Statements - Transfers In $5,741,269 $ 3,411,095 $2,643,332 $ 39,667,022 $ 51,462,718 $ 350,148 $1,457,909 $1,808,057 $ 678,702 $ 750 $ 53,950,227

*Due to the different basis of accounting and measurement focus between the governmental fund statements and the entity-wide statements, not all transfer activity, such as transfers of assets, are reflected in the governmental fund statements.

Total Transfers on Statement of Activities

Governmental Activities Total transfers in-governmental funds $ 51,462,718 Less total transfers out-governmental funds (49,587,346) Total transfers in-internal service funds 678,702 Less total transfers out-internal service funds (3,470,200) Full Accrual Activity* (315,044) Net transfers out to business-type activities $ (1,231,170)

Business-type Activities Total transfers in $ 1,808,057 Less total transfers out (576,887) Net transfers in from governmental activities $ 1,231,170 Notes to the Financial Statements December 31, 2017

3.J Governmental Fund Balance

The County reported $197.3 million in restricted fund balance in the governmental funds. Restricted fund balance/net position are subject to external restrictions such as those imposed by state and federal law or by contractual agreements with third parties. Committed fund balance is committed for a specific purpose pursuant to constraints imposed by a formal action such as a County ordinance adopted by the County’s highest level of decision-making authority, the County Council with approval of the County Executive. Similar formal action is required to create, modify, or rescind an ordinance. Assigned fund balance are resources intended to be used for a specific purpose. Assignments are expressed by the governing body or an official authorized by the governing body. No formal action is required to reallocate assigned fund balance.

Unless otherwise directed by the County Council, County Executive, or Director of Finance and committed to writing, resources shall be utilized in the following order: restricted, committed, assigned, and unassigned.

The governmental fund balance is summarized below:

Capital Other General County Road Human Projects Governmental Fund Fund Services Fund Funds Total Restricted Purpose: Animal Benefit $ - $ - $ - $ - $ 11,963 $ 11,963 Artwork - - - - 198,400 198,400 Blanche Miller - - - - 498,736 498,736 Capital Purposes - - - 58,712,166 18,673,569 77,385,735 Court Purposes - - - - 1,601,189 1,601,189 Emergency Svcs Comm System - - - - 6,770,119 6,770,119 Facilitate Victims/Witnesses - - - - 46,366 46,366 Health & Human Services - - 26,790,767 - - 26,790,767 Historical Preservation - - - - 782,969 782,969 Inmate Benefit - - - - 278,129 278,129 Investigation/Prosecution of Antiprofiteering - - - - 79,641 79,641 Law Enforcement - - - - 568,440 568,440 Law Library - - - - 146,994 146,994 Parks - - - - 31,467,757 31,467,757 Program Administration/Enforcement - - - - 4,904,508 4,904,508 Prosecuting Attorney - - - - 236,914 236,914 Refunds - - - - 311,880 311,880 Roads - 19,885,658 - - 17,029,548 36,915,206 Tourism - - - - 7,480,177 7,480,177 Treasurer - - - - 826,475 826,475 Water Quality Control - - - - 704 704 Total Restricted Fund Balance - 19,885,658 26,790,767 58,712,166 91,914,478 197,303,069

62 Notes to the Financial Statements December 31, 2017

Capital Other General County Road Human Projects Governmental Fund Fund Services Fund Funds Total Committed Purpose: Animal Benefit - - - - 17 17 Artwork - - - - 2,374 2,374 Capital Purposes - - - 33,465 9,466,345 9,499,810 Court Purposes - - - - 152,332 152,332 Data Processing Systems - - - - 4,316,901 4,316,901 Debt Service - - - - 388,457 388,457 Education and Training - - - - 58 58 Emergency Svcs Comm System - - - - 62,608 62,608 Facilitate Victims/Witnesses - - - - 14,055 14,055 Grants - - - - 967,056 967,056 Health & Human Services - - 171,975 - - 171,975 Investigation/Prosecution of Antiprofiteering - - - - 673 673 Law Enforcement - - - - 141,231 141,231 Parks - - - - 194,350 194,350 Program Administration/Enforcement - - - - 6,225,331 6,225,331 Prosecuting Attorney - - - - 1,406 1,406 Roads - 14,464,070 - - - 14,464,070 Stabilization 200,000 - - - - 200,000 Tourism - - - - 70,800 70,800 Treasurer - - - - 72,425 72,425 Water Quality/Control - - - - 2,343 2,343 Total Committed Fund Balance 200,000 14,464,070 171,975 33,465 22,078,762 36,948,272

Assigned For: General Government 2,915,514 - - - - 2,915,514 Total Assigned Fund Balance 2,915,514 - - - - 2,915,514

Unassigned 29,838,013 - - - - 29,838,013

Total Fund Balance $32,953,527 $ 34,349,728 $ 26,962,742 $ 58,745,631 $ 113,993,240 $ 267,004,868

Note 4 Other Notes

4.A Pension Plans and Other Benefit Plans

The following table represents the aggregate pension amounts for all plans subject to the requirements of the GASB Statement 68, Accounting and Financial Reporting for Pensions for the year 2017:

Aggregate Pension Amounts – All Plans Pension liabilities $ (120,362,206) Pension assets $ 15,067,312 Deferred outflows of resources $ 19,134,812 Deferred inflows of resources $ (25,612,542) Pension expense/expenditures $ 10,090,730

State Sponsored Pension Plans

Substantially all Snohomish County full-time and qualifying part-time employees participate in one of the following statewide retirement systems administered by the

63 Notes to the Financial Statements December 31, 2017

Washington State Department of Retirement Systems, under cost-sharing, multiple- employer public employee defined benefit and defined contribution retirement plans. The state Legislature establishes, and amends, laws pertaining to the creation and administration of all public retirement systems.

The Department of Retirement Systems (DRS), a department within the primary government of the State of Washington, issues a publicly available comprehensive annual financial report (CAFR) that includes financial statements and required supplementary information for each plan. The DRS CAFR may be obtained by writing to:

Department of Retirement Systems Communications Unit P.O. Box 48380 Olympia, WA 98540-8380

Or the DRS CAFR may be downloaded from the DRS website at www.drs.wa.gov.

Public Employees’ Retirement System (PERS)

PERS members include elected officials; state employees; employees of the Supreme, Appeals and Superior Courts; employees of the legislature; employees of district and municipal courts; employees of local governments; and higher education employees not participating in higher education retirement programs. PERS is comprised of three separate pension plans for membership purposes. PERS plans 1 and 2 are defined benefit plans, and PERS plan 3 is a defined benefit plan with a defined contribution component.

PERS Plan 1 provides retirement, disability and death benefits. Retirement benefits are determined as two percent of the member’s average final compensation (AFC) times the member’s years of service. The AFC is the average of the member’s 24 highest consecutive service months. Members are eligible for retirement from active status at any age with at least 30 years of service, at age 55 with at least 25 years of service, or at age 60 with at least five years of service. Members retiring from active status prior to the age of 65 may receive actuarially reduced benefits. Retirement benefits are actuarially reduced to reflect the choice of a survivor benefit. Other benefits include duty and non-duty disability payments, an optional cost-of-living adjustment (COLA), and a one-time duty-related death benefit, if found eligible by the Department of Labor and Industries. PERS 1 members were vested after the completion of five years of eligible service. The plan was closed to new entrants on September 30, 1977.

Contributions

The PERS Plan 1 member contribution rate is established by State statute at 6 percent. The employer contribution rate is developed by the Office of the State Actuary and includes an administrative expense component that is currently set at 0.18 percent. Each biennium, the state Pension Funding Council adopts Plan 1 employer contribution rates. The PERS Plan 1 required contribution rates (expressed as a percentage of covered payroll) for 2017 were as follows:

64 Notes to the Financial Statements December 31, 2017

PERS Plan 1 Actual Contribution Employer Employee* Rates January - June 2017: PERS Plan 1 6.23% 6.00% PERS Plan 1 UAAL 4.77% Administrative Fee 0.18% Total 11.18% 6.00% July - December 2017: PERS Plan 1 7.49% 6.00% PERS Plan 1 UAAL 5.03% Administrative Fee 0.18% Total 12.70% 6.00%

* For employees participating in JBM, the contribution rate was 12.26%.

PERS Plan 2/3 provides retirement, disability and death benefits. Retirement benefits are determined as two percent of the member’s average final compensation (AFC) times the member’s years of service for Plan 2 and 1 percent of AFC for Plan 3. The AFC is the average of the member’s 60 highest-paid consecutive service months. There is no cap on years of service credit. Members are eligible for retirement with a full benefit at 65 with at least five years of service credit. Retirement before age 65 is considered an early retirement. PERS Plan 2/3 members who have at least 20 years of service credit and are 55 years of age or older, are eligible for early retirement with a benefit that is reduced by a factor that varies according to age for each year before age 65. PERS Plan 2/3 members who have 30 or more years of service credit and are at least 55 years old can retire under one of two provisions:

• With a benefit that is reduced by three percent for each year before age 65; or

• With a benefit that has a smaller (or no) reduction (depending on age) that imposes stricter return-to-work rules.

PERS Plan 2/3 members hired on or after May 1, 2013 have the option to retire early by accepting a reduction of five percent for each year of retirement before age 65. This option is available only to those who are age 55 or older and have at least 30 years of service credit. PERS Plan 2/3 retirement benefits are also actuarially reduced to reflect the choice of a survivor benefit. Other PERS Plan 2/3 benefits include duty and non- duty disability payments, a cost-of-living allowance (based on the CPI), capped at three percent annually and a one-time duty related death benefit, if found eligible by the Department of Labor and Industries. PERS 2 members are vested after completing five years of eligible service. Plan 3 members are vested in the defined benefit portion of their plan after ten years of service; or after five years of service if 12 months of that service are earned after age 44.

PERS Plan 3 defined contribution benefits are totally dependent on employee contributions and investment earnings on those contributions. PERS Plan 3 members choose their contribution rate upon joining membership and have a chance to change

65 Notes to the Financial Statements December 31, 2017

rates upon changing employers. As established by statute, Plan 3 required defined contribution rates are set at a minimum of 5 percent and escalate to 15 percent with a choice of six options. Employers do not contribute to the defined contribution benefits. PERS Plan 3 members are immediately vested in the defined contribution portion of their plan.

Contributions

The PERS Plan 2/3 employer and employee contribution rates are developed by the Office of the State Actuary to fully fund Plan 2 and the defined benefit portion of Plan 3. The Plan 2/3 employer rates include a component to address the PERS Plan 1 UAAL and an administrative expense that is currently set at 0.18 percent. Each biennium, the state Pension Funding Council adopts Plan 2 employer and employee contribution rates and Plan 3 contribution rates. The PERS Plan 2/3 required contribution rates (expressed as a percentage of covered payroll) for 2017 were as follows:

PERS Plan 2/3 Actual Contribution Employer Employee 2* Rates 2/3 January – June 2017: PERS Plan 2/3 6.23% 6.12% PERS Plan 1 UAAL 4.77% Administrative Fee 0.18% Employee PERS Plan 3 Varies Total 11.18% 6.12% July – December 2017: PERS Plan 2/3 7.49% 7.38% PERS Plan 1 UAAL 5.03% Administrative Fee 0.18% Employee PERS Plan 3 Varies Total 12.70% 7.38%

* For employees participating in JBM, the contribution rate was 15.30% for January – June 2017 and 18.45% for July - December 2017.

PERS Plan 1 and PERS Plan 1 UAAL actual employer contributions for the year were $7.9 million and employee contributions were $169 thousand for a total county contribution of $8.1 million. PERS Plan 2/3 actual employer contributions for the year were $10.7 million and employee contributions were $10.6 million for a total county contribution of $21.3 million.

Public Safety Employees’ Retirement System (PSERS)

PSERS Plan 2 was created by the 2004 Legislature and became effective July 1, 2006. To be eligible for membership, an employee must work on a full time basis and:

66 Notes to the Financial Statements December 31, 2017

• Have completed a certified criminal justice training course with authority to arrest, conduct criminal investigations, enforce the criminal laws of Washington, and carry a firearm as part of the job; or

• Have primary responsibility to ensure the custody and security of incarcerated or probationary individuals; or

• Function as a limited authority Washington peace officer, as defined in RCW 10.93.020; or

• Have primary responsibility to supervise eligible members who meet the above criteria.

PSERS membership includes:

• PERS 2 or 3 employees hired by a covered employer before July 1, 2006, who met at least one of the PSERS eligibility criteria and elected membership during the period of July 1, 2006 to September 30 2006; and

• Employees hired on or after July 1, 2006 by a covered employer, that meet at least one of the PSERS eligibility criteria.

PSERS covered employers include:

• Certain State of Washington agencies (Department of Corrections, Department of Natural Resources, Gambling Commission, Liquor Control Board, Parks and Recreation Commission, and Washington State Patrol),

• Washington State Counties,

• Washington State Cities (except for Seattle, Spokane, and Tacoma),

• Correctional entities formed by PSERS employers under the Inter-local Cooperation Act.

PSERS Plan 2 provides retirement, disability and death benefits. Retirement benefits are determined as two percent of the average final compensation (AFC) for each year of service. The AFC is based on the member’s 60 consecutive highest creditable months of service. Benefits are actuarially reduced for each year that the member’s age is less than 60 (with ten or more service credit years in PSERS), or less than 65 (with fewer than ten service credit years). There is no cap on years of service credit. Members are eligible for retirement at the age of 65 with five years of service; or at the age of 60 with at least ten years of PSERS service credit; or at age 53 with 20 years of service. Retirement before age 60 is considered an early retirement. PSERS members who retire prior to the age of 60 receive reduced benefits. If retirement is at age 53 or older with at least 20 years of service, a three percent per year reduction for each year between the age at retirement and age 60 applies. PSERS Plan 2 retirement benefits are actuarially reduced to reflect the choice of a survivor benefit. Other benefits include duty and non-duty disability payments, an optional cost-of living adjustment (COLA), and

67 Notes to the Financial Statements December 31, 2017

a one-time duty-related death benefit, if found eligible by the Department of Labor and Industries. PSERS Plan 2 members are vested after completing five years of eligible service.

Contributions

The PSERS Plan 2 employer and employee contribution rates are developed by the Office of the State Actuary to fully fund Plan 2. The Plan 2 employer rates include components to address the PERS Plan 1 unfunded actuarial accrued liability and administrative expense currently set at 0.18 percent. Each biennium, the state Pension Funding Council adopts Plan 2 employer and employee contribution rates. In addition to the regular change in contribution rates on July 1, 2017, PSERS contribution rates changed again September 1, 2017 due to HB 1709, which allows PERS members meeting specific criteria to transfer service credit into PSERS as long as they and their employer pay the difference between the PERS and PSERS contribution rates.

The PSERS Plan 2 required contribution rates (expressed as a percentage of current- year covered payroll) for 2017 were as follows:

PSERS Plan 2 Actual Contribution Rates Employer Employee January – June 2017: PSERS Plan 2 6.59% 6.59% PERS Plan 1 UAAL 4.77% Administrative Fee 0.18% Total 11.54% 6.59% July – August 2017: PSERS Plan 2 6.73% 6.73% PERS Plan 1 UAAL 5.03% Administrative Fee 0.18% Total 11.94% 6.73% September – December 2017 PSERS Plan 2 6.74% 6.74% PERS Plan 1 UAAL 5.03% Administrative Fee 0.18% Total 11.95% 6.74%

PSERS Plan 2 actual employer contributions for the year were $1.15 million and employee contributions were $1.15 million for a total county contribution of $2.3 million. PERS Plan 1 UAAL employer contributions for the year were $846 thousand.

Law Enforcement Officers’ and Fire Fighters’ Retirement System (LEOFF)

LEOFF membership includes all full-time, fully compensated, local law enforcement commissioned officers, firefighters, and as of July 24, 2005, emergency medical technicians. LEOFF is comprised of two separate defined benefit plans.

68 Notes to the Financial Statements December 31, 2017

LEOFF Plan 1 provides retirement, disability and death benefits. Retirement benefits are determined per year of service calculated as a percent of final average salary (FAS) as follows:

• 20+ years of service – 2.0% of FAS • 10-19 years of service – 1.5% of FAS • 5-9 years of service – 1% of FAS

The FAS is the basic monthly salary received at the time of retirement, provided a member has held the same position or rank for 12 months preceding the date of retirement. Otherwise, it is the average of the highest consecutive 24 months’ salary within the last ten years of service. Members are eligible for retirement with five years of service at the age of 50. Other benefits include duty and non-duty disability payments, a cost-of living adjustment (COLA), and a one-time duty-related death benefit, if found eligible by the Department of Labor and Industries. LEOFF 1 members were vested after the completion of five years of eligible service. The plan was closed to new entrants on September 30, 1977.

Contributions

Starting on July 1, 2000, LEOFF Plan 1 employers and employees contribute zero percent, as long as the plan remains fully funded. The LEOFF Plan I had no required employer or employee contributions for fiscal year 2017. Employers paid only the administrative expense of 0.18 percent of covered payroll.

LEOFF Plan 2 provides retirement, disability and death benefits. Retirement benefits are determined as two percent of the final average salary (FAS) per year of service (the FAS is based on the highest consecutive 60 months). Members are eligible for retirement with a full benefit at 53 with at least five years of service credit. Members who retire prior to the age of 53 receive reduced benefits. If the member has at least 20 years of service and is age 50, the reduction is three percent for each year prior to age 53. Otherwise, the benefits are actuarially reduced for each year prior to age 53. LEOFF 2 retirement benefits are also actuarially reduced to reflect the choice of a survivor benefit. Other benefits include duty and non-duty disability payments, a cost-of-living allowance (based on the CPI), capped at three percent annually and a one-time duty-related death benefit, if found eligible by the Department of Labor and Industries. LEOFF 2 members are vested after the completion of five years of eligible service.

Contributions

The LEOFF Plan 2 employer and employee contribution rates are developed by the Office of the State Actuary to fully fund Plan 2. The employer rate included an administrative expense component set at 0.18 percent. Plan 2 employers and employees are required to pay at the level adopted by the LEOFF Plan 2 Retirement Board. The LEOFF Plan 2 required contribution rates (expressed as a percentage of covered payroll) for 2017 were as follows:

69 Notes to the Financial Statements December 31, 2017

LEOFF Plan 2 Actual Contribution Rates Employer Employee January – June 2017: State and local governments 5.05% 8.41% Administrative Fee 0.18% Total 5.23% 8.41% July – December 2017: State and local governments 5.25% 8.75% Administrative Fee 0.18% Total 5.43% 8.75%

LEOFF 2 actual employer contributions for the year were $1.55 million and employee contributions were 2.59 million for a total county contribution of $4.1 million.

The Legislature, by means of a special funding arrangement, appropriates money from the state General Fund to supplement the current service liability and fund the prior service costs of Plan 2 in accordance with the recommendations of the Pension Funding Council and the LEOFF Plan 2 Retirement Board. This special funding situation is not mandated by the state constitution and could be changed by statute. For the state fiscal year ending June 30, 2017, the state contributed $62,155,262 to LEOFF Plan 2. The amount recognized by the County as its proportionate share of this amount is $8.4 million.

Actuarial Assumptions

The total pension liability (TPL) for each of the DRS plans was determined using the most recent actuarial valuation completed in 2017 with a valuation date of June 30, 2016. The actuarial assumptions used in the valuation were based on the results of the Office of the State Actuary’s (OSA) 2007-2012 Experience Study and the 2015 Economic Experience Study.

Additional assumptions for subsequent events and law changes are current as of the 2016 actuarial valuation report. The TPL was calculated as of the valuation date and rolled forward to the measurement date of June 30, 2017. Plan liabilities were rolled forward from June 30, 2016, to June 30, 2017, reflecting each plan’s normal cost (using the entry-age cost method), assumed interest and actual benefit payments.

• Inflation: 3.0% total economic inflation; 3.75% salary inflation

• Salary increases: In addition to the base 3.75% salary inflation assumption, salaries are also expected to grow by promotions and longevity.

• Investment rate of return: 7.5%

Mortality rates were based on the RP-2000 report’s Combined Healthy Table and Combined Disabled Table, published by the Society of Actuaries. The OSA applied offsets to the base table and recognized future improvements in mortality by projecting the mortality rates using 100 percent Scale BB. Mortality rates are applied on a

70 Notes to the Financial Statements December 31, 2017

generational basis; meaning, each member is assumed to receive additional mortality improvements in each future year throughout his or her lifetime.

There were changes in methods and assumptions since the last valuation.

• For all plans except LEOFF Plan 1, how terminated and vested member benefits are valued was corrected.

• How the basic minimum COLA in PERS Plan 1 is valued for legal order payees was improved.

• For all plans, the average expected remaining service lives calculation was revised.

Discount Rate

The discount rate used to measure the total pension liability for all DRS plans was 7.5 percent.

To determine that rate, an asset sufficiency test included an assumed 7.7 percent long- term discount rate to determine funding liabilities for calculating future contribution rate requirements. (All plans use 7.7 percent except LEOFF 2, which has assumed 7.5 percent). Consistent with the long-term expected rate of return, a 7.5 percent future investment rate of return on invested assets was assumed for the test. Contributions from plan members and employers are assumed to continue being made at contractually required rates (including PERS 2/3, PSERS 2, SERS 2/3, and TRS 2/3 employers, whose rates include a component for the PERS 1, and TRS 1 plan liabilities). Based on these assumptions, the pension plans’ fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return of 7.5 percent was used to determine the total liability.

Long-Term Expected Rate of Return

The long-term expected rate of return on the DRS pension plan investments of 7.5 percent was determined using a building-block-method. In selecting this assumption, the Office of the State Actuary (OSA) reviewed the historical experience data, considered the historical conditions that produced past annual investment returns, and considered capital market assumptions and simulated expected investment returns provided by the Washington State Investment Board (WSIB). The WSIB uses the capital market assumptions and their target asset allocation to simulate future investment returns over various time horizons.

Estimated Rates of Return by Asset Class

Best estimates of arithmetic real rates of return for each major asset class included in the pension plan’s target asset allocation as of June 30, 2017, are summarized in the table below. The inflation component used to create the table is 2.2 percent and represents the WSIB’s most recent long-term estimate of broad economic inflation.

71 Notes to the Financial Statements December 31, 2017

% Long-Term Target Expected Real Rate Asset Class Allocation of Return Arithmetic Fixed Income 20% 1.70% Tangible Assets 5% 4.90% Real Estate 15% 5.80% Global Equity 37% 6.30% Private Equity 23% 9.30% 100%

Sensitivity of the Net Pension Liability/(Asset)

The table below presents the County’s proportionate share of the net pension liability calculated using the discount rate of 7.5 percent, as well as what the County’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.5 percent) or 1-percentage point higher (8.5 percent) than the current rate.

Current 1% Decrease Discount Rate 1% Increase (6.5%) (7.5%) (8.5%) PERS 1 $ 79,962,405 $ 65,640,277 $ 53,234,247 PERS 2/3 $145,129,632 $ 53,869,337 $ (20,904,938) PSERS 2 $ 5,724,807 $ 852,592 $ (2,967,514) LEOFF 1 $ (1,571,155) $ (2,118,130) $ (2,587,857) LEOFF 2 $ 2,802,183 $(12,949,182) $ (25,782,736)

Pension Plan Fiduciary Net Position

Detailed information about the State’s pension plans’ fiduciary net position is available in the separately issued DRS financial report.

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

At June 30, 2017, the county reported a total pension liability of $120.4 million and a total pension assets of $15.1 million. The County’s proportionate share of the net pension liabilities (Assets) are as follows:

Liability (or Asset) PERS 1 $ 65,640,277 PERS 2/3 $ 53,869,337 PSERS 2 $ 852,592 LEOFF 1 $ (2,118,130) LEOFF 2 $ (12,949,182)

The amount of the asset reported above for LEOFF Plans 1 and 2 reflects a reduction for State pension support provided to the County. The amount recognized by the County

72 Notes to the Financial Statements December 31, 2017

as its proportionate share of the net pension asset, the related State support, and the total portion of the net pension asset that was associated with the County were as follows:

LEOFF 1 Asset LEOFF 2 Asset Employer’s proportionate share $ (2,118,130) $ (12,949,182) State’s proportionate share of the net pension asset associated with the employer $ (14,326,980) $ (8,399,892) TOTAL $ (16,445,110) $ (21,349,074)

At June 30, the County proportionate share of the collective net pension liabilities was as follows:

Proportionate Proportionate Change in Share 6/30/16 Share 6/30/17 Proportion PERS 1 1.416333% 1.383334% -0.032999% PERS 2/3 1.573091% 1.550410% -0.022681% PSERS 2 4.442221% 4.351513% -0.090708% LEOFF 1 0.140948% 0.139606% -0.001342% LEOFF 2 0.879315% 0.933156% 0.053841%

Employer contribution transmittals received and processed by the DRS for the fiscal year ended June 30 are used as the basis for determining each employer’s proportionate share of the collective pension amounts reported by the DRS in the Schedules of Employer and Non-employer Allocations for all plans except LEOFF 1.

LEOFF Plan 1 allocation percentages are based on the total historical employer contributions to LEOFF 1 from 1971 through 2000 and the retirement benefit payments in fiscal year 2017. Historical data was obtained from a 2011 study by the Office of the State Actuary (OSA). In fiscal year 2017, the state of Washington contributed 87.12 percent of LEOFF 1 employer contributions and all other employers contributed the remaining 12.88 percent of employer contributions. LEOFF 1 is fully funded and no further employer contributions have been required since June 2000. If the plan becomes underfunded, funding of the remaining liability will require new legislation. The allocation method the plan chose reflects the projected long-term contribution effort based on historical data.

In fiscal year 2017, the state of Washington contributed 39.35 percent of LEOFF 2 employer contributions pursuant to RCW 41.26.725 and all other employers contributed the remaining 60.65 percent of employer contributions.

The collective net pension liability (asset) was measured as of June 30, 2017, and the actuarial valuation date on which the total pension liability (asset) is based was as of June 30, 2016, with update procedures used to roll forward the total pension liability to the measurement date.

73 Notes to the Financial Statements December 31, 2017

Pension Expense

For the year ended December 31, 2017, the County recognized pension expense as follows:

Pension Expense PERS 1 $ 2,312,421 PERS 2/3 $ 6,417,155 PSERS 2 $ 1,239,004 LEOFF 1 $ (321,529) LEOFF 2 $ 443,679 TOTAL $ 10,090,730

Deferred Outflows of Resources and Deferred Inflows of Resources

At December 31, 2017, the County reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred Deferred Outflows of Inflows of PERS 1 Resources Resources Differences between expected and $ - $ - actual experience Net difference between projected and actual investment earnings on pension $ - $ - plan investments Changes of assumptions $ - $ (2,449,511) Changes in proportion and differences between contributions and proportionate $ - $ - share of contributions Contributions subsequent to the $ 4,577,907 $ - measurement date TOTAL $ 4,577,907 $ (2,449,511)

Deferred Deferred Outflows of Inflows of PERS 2/3 Resources Resources

Differences between expected and actual $ 5,458,234 $ (1,771,669) experience

Net difference between projected and actual investment earnings on pension $ - $ (14,360,270) plan investments Changes of assumptions $ 572,194 $ -

Changes in proportion and differences $ - $ (2,290,245) between contributions and proportionate share of contributions

Contributions subsequent to the $ 5,927,001 $ - measurement date TOTAL $ 11,957,429 $ (18,422,184)

74 Notes to the Financial Statements December 31, 2017

Deferred Deferred Outflows of Inflows of PSERS Resources Resources

Differences between expected and actual $ 504,253 $ (60,573) experience

Net difference between projected and actual investment earnings on pension $ - $ (597,985) plan investments Changes of assumptions $ 7,224 $ -

Changes in proportion and differences between contributions and proportionate $ - $ - share of contributions

Contributions subsequent to the $ 573,463 $ (61,780) measurement date TOTAL $ 1,084,940 $ (720,338)

Deferred Deferred Outflows of Inflows of LEOFF 1 Resources Resources

Differences between expected and actual $ - $ - experience

Net difference between projected and actual investment earnings on pension $ - $ (196,824) plan investments Changes of assumptions $ - $ -

Changes in proportion and differences $ - $ - between contributions and proportionate share of contributions

Contributions subsequent to the $ - $ - measurement date TOTAL $ - $ (196,824)

75 Notes to the Financial Statements December 31, 2017

Deferred Deferred Outflows of Inflows of LEOFF 2 Resources Resources

Differences between expected and actual $ 569,141 $ (491,055) experience

Net difference between projected and actual investment earnings on pension $ - $ (2,907,182) plan investments Changes of assumptions $ 15,593 $ -

Changes in proportion and differences between contributions and proportionate $ 181,349 $ (425,458) share of contributions

Contributions subsequent to the $ 748,454 $ - measurement date TOTAL $ 1,514,537 $ (3,823,695)

Deferred outflows of resources related to pensions resulting from the County’s contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended December 31, 2018. Other amounts reported as deferred outflows and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year ended PERS 1 December 31: 2018 $ (1,655,712) 2019 $ 522,734 2020 $ (121,374) 2021 $ (1,195,159) 2022 $ - Thereafter $ -

Year ended PERS 2/3 December 31: 2018 $ (6,635,093) 2019 $ 811,647 2020 $ (1,471,537) 2021 $ (5,908,251) 2022 $ 352,816 Thereafter $ 458,663

76 Notes to the Financial Statements December 31, 2017

Year ended PSERS December 31: 2018 $ (137,515) 2019 $ 97,423 2020 $ 19,662 2021 $ (134,859) 2022 $ (11,017) Thereafter $ (42,556)

Year ended LEOFF 1 December 31: 2018 $ (123,523) 2019 $ 33,314 2020 $ (13,303) 2021 $ (93,311) 2022 $ - Thereafter $ -

Year ended LEOFF 2 December 31: 2018 $ (1,339,072) 2019 $ 298,953 2020 $ (203,048) 2021 $ (1,279,791) 2022 $ (95,474) Thereafter $ (439,179)

Annual OPEB Cost and Net OPEB Obligation The County’s annual other post-employment benefit (OPEB) cost is calculated based upon the annual required contribution (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover the normal cost each year and amortize any unfunded actuarial liabilities over a period of thirty years as of January 1, 2007. The following table shows the components of the County’s annual OPEB cost for the year, the amount actually contributed to the plan and changes in the County’s net OPEB for LEOFF.

77 Notes to the Financial Statements December 31, 2017

Annual Required Contribution (ARC) 12/31/2017 1. Annual Normal Cost (1/1/17) $ - 2. Amortization of UAAL (1/1/17) $ 1,768,951 3. Interest to 12/31/17 [(1)+(2)]x(i)* $ 61,913

4. ARC at 12/31/17 [(1)+(2)+(3)] $ 1,830,864

5. Interest on prior Net OPEB Obligation $ 229,130 6. Adjustment to ARC $ 430,345

7. Annual OPEB cost [(4)+(5)-(6)] $ 1,629,649

8. Employer Contributions $ 711,431 9. Change in Net OPEB Obligation [(7)-(8)] $ 918,218

10. Net OPEB Obligation at 1/1/17 $ 6,546,575 11. Net OPEB Obligation at 12/31/17 [(9)+(10)] $ 7,464,793

* ‘i’ the assumed interest rate is 3.5% in 2016. (UAAL is defined as “Unfunded Actuarial Accrued Liability”.)

The County’s annual OPEB cost, the percentage of OPEB cost contributed to the plan, and the net change in OPEB obligation, as of December 31, 2016 were as follows:

Pecentage of Annual OPEB Annual OPEB Ending Net OPEB Year Ended Cost Cost Contributed Obligation 12/31/2017$ 1,629,649 43.66%$ 7,464,793 12/31/2016$ 1,656,163 47.91%$ 6,546,575 12/31/2015$ 1,670,726 39.49%$ 5,683,943

Funded Status and Funding Progress As of January 1, 2016, the most recent actuarial valuation date, the plan was 0% funded. The accrued liability for benefits was $27 million, and the actuarial value of assets was $0, resulting in a UAAL of $27 million. The last active LEOFF 1 employee retired in 2017 which results in a current year covered payroll amount of $0. The unfunded actuarial accrued liability as a percentage of annual covered payroll is 0%. Snohomish County’s plan has fewer than 100 members and, as such, is required to have an actuarial valuation performed at least triennially. The next actuarial reevaluation of the County’s OPEB obligation is scheduled for 2019.

78 Notes to the Financial Statements December 31, 2017

Schedule of Funding Progress:

Actuarial Value Actuarial Unfunded Actuarial Valuation Date of Assets Accrued Liability Accrued Liability Funded Ratio 1/1/2016 $ - $ 26,910,000 $ 26,910,000 0%

Actuarial valuations involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future.

The County’s OPEB liability is recorded in an internal service fund. As of December 31, 2016, the County had adequate fund balance to pay the full 2016 annual required contribution (ARC).

Actuarial Methods and Assumptions Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the types of benefits provided at the time of each valuation. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short- term volatility in actuarial accrued liabilities, consistent with the long-term perspective of the calculations.

In the January 1, 2016 actuarial valuation, the entry age normal actuarial cost method was used. A single retirement age of 66 was assumed for all active members for the purpose of determining the AAL and normal cost. The Actuarial Accrued Liability (AAL) and Net OPEB Obligation (NOO) are amortized on a closed basis as a level dollar over 30 years. The following assumptions were used: annual growth in membership – 0%, return on investment earnings – 3.5%, inflation – 2.25%, and the long term care inflation trend – 4.5%.

See the Schedule of Funding Progress immediately following the notes to the financial statements.

4.B Risk Management

Snohomish County is exposed to various risks of loss, including theft, property damage, or destruction of assets, business interruption, errors and omissions, injuries to employees, and natural disasters.

The County uses two internal service funds to account for and finance property/casualty, worker’s compensation, unemployment, and employee medical and dental benefits self- insurance programs. The County has a professional claims adjuster position to adjudicate all general liability claims not directly handled by the Prosecuting Attorney’s Office, Civil Division, per County Code 2.90.060. The County contracts with third-party claim administrators to manage workers’ compensation and employee medical benefits claims. Unemployment claims are administered through Washington State Department of

79 Notes to the Financial Statements December 31, 2017

Employment Security. The Civil Division of the County’s Prosecuting Attorney’s office handles all liability lawsuits and, when requested, claims. The County is self-insured for $3 million, and procures $50 million excess insurance for damages and/or legal actions settled for more than $3 million. There were no settlements in excess of the insurance coverage in the past three years.

Claims settlements and loss expenses are reported in the Insurance Fund and the Employee Benefit Fund. These funds are responsible for collecting interfund premiums from insured funds and departments, for paying claims and settlements, and for purchasing certain excess insurance policies. Interfund premiums are assessed on the basis of claims experience, insurance policy purchases, and risk management programs. The County's established liabilities for probable losses for 2017 and 2016 are:

Worker's Compensation General Liability Total 2017 2016 2017 2016 2017 2016 Claims Liability, Beginning of Year $ 5,362,533 $ 5,320,165 $ 14,526,074 $ 10,863,360 $ 19,888,607 $ 16,183,525 Incurred Claims and Changes 1,724,198 2,254,198 8,037,655 15,177,526 9,761,853 17,431,724 Payments on Claims (2,177,975) (2,211,830) (3,852,671) (11,514,812) (6,030,646) (13,726,642) Claims Liability, End of Year $ 4,908,756 $ 5,362,533 $ 18,711,058 $ 14,526,074 $ 23,619,814 $ 19,888,607

Claims Liability, Current Portion $ 1,557,174 $ 1,704,609 $ 3,549,494 $ 3,315,354 $ 5,106,668 $ 5,019,963 Claims Liability, Long term Portion 3,351,582 3,657,924 15,161,564 11,210,720 18,513,146 14,868,644 Claims Liability, End of Year $ 4,908,756 $ 5,362,533 $ 18,711,058 $ 14,526,074 $ 23,619,814 $ 19,888,607

Insurance Fund The Insurance Fund accounts for the County’s property/casualty insurance program. Established in 1977, this fund accounts for the County’s exposures to loss due to the tortuous conduct of the County and includes, but is not limited to, those damages which are commonly covered by commercial general liability, business/automobile liability, employment practices and public official errors and omissions policies. In addition to its general liability insurance coverages and excess liability policies, the County insurance fund, also self-funds Public Records Act violation settlements and has specific liability insurance policies to cover some of its other exposures, and coverage for protection against other types of losses. The Insurance Fund also funds policy deductibles.

The fund also accounts for all Risk Management programs, including safety and worker’s compensation. The County is self-insured for workers’ compensation as certified under the Revised Code of Washington, Industrial Insurance Act, and Title 51. Additionally, the County purchases an Excess Workers’ Compensation insurance policy with statutory limits.

General liability and worker’s compensation claim estimates are based on an actuarial analysis prepared by AON Actuarial & Analytical Consulting in February of each year. The estimate includes all pending claim reserves and estimates for incurred, but not yet received, claims (IBNR). The estimated liability for unpaid claims that are recorded at present value and discounted at 3.5% in the financial statements as of December 31, 2017, is $23.5 million.

Unemployment compensation benefits are expensed quarterly as claims are billed from the Washington State Department of Employment Security. All interfund premiums are

80 Notes to the Financial Statements December 31, 2017

assessed on loss history, and are reported as revenues in the Insurance Fund, and as expenses or expenditures by insured funds.

Employee Benefits Program Fund The Employee Benefits Program Fund accounts for medical, dental, vision, life, accidental death and dismemberment, long-term-disability, and other benefits, including LEOFF retiree medical benefits. The benefits offered by the County include both self- insured medical and vision plans, which the County offers to employees, outside district subscribers, and COBRA subscribers. Snohomish County retirees may participate in a self-insured retiree medical insurance plan. Interfund premiums are calculated on a per subscriber per month basis and charged to departments through composite rates that include expected claims, expenses, premiums, and administrative expenses. In most cases, employees contribute towards medical insurance premiums.

4.C Commitments, Contingencies, and Legal Matters

Snohomish County has recorded in its financial statements all material liabilities, including an estimate for situations not yet resolved, but where, based on available information, management believes it is probable that the County will have to make payment. All known or pending claims are properly recognized within the recorded liabilities of the Snohomish County insurance fund, or are covered by insurance policies.

Non-Financial Guarantees The County has 3 Contingent Loan Agreements in place with 1 local entity that provides housing for low-income persons/families in Snohomish County. The Contingent Loan agreements were created to assist with debt service payments in the event that the entities are unable to meet their debt service obligation for certain bonds or loans named in the Contingent Loan Agreements. RCW 35.83.050 states that a County located in whole or in part within the area of operation of a housing authority may lend or donate money to a housing authority. Each of these agreements remains in effect until the debt is paid in full or in some cases if the debt is defeased. The agreements note that if the County does make debt service payments on behalf of the entities that the entities are required to pay back the County. In the event that the entity doesn’t repay the County, the County has the option to call the bonds early or take over management of the project that the debt relates to.

The County does not anticipate that it will become necessary to fulfill these guarantees. Accordingly, no liability has been recorded for them. The Contingent Loan agreements are as follows:

Debt Outstanding Final Issue Principal at Bond Issue r Year 12/31/17 Maturity Housing Authority of Snohomish County 2007$ 3,285,000 4/1/2037 Washington State Housing Finance Commission 2010 1,300,000 7/1/2045 (Housing Authority of Snohomish County) Housing Authority of Snohomish County 2012 9,015,000 5/1/2041 $ 13,600,000

81 Notes to the Financial Statements December 31, 2017

Contracts Regional Disposal In June 1992, Solid Waste Management entered into a waste export contract with Republic Services (formerly known as Regional Disposal Company), to transport Snohomish County’s solid waste to Republic Services’ Klickitat County, Washington, landfill. The County agrees to deliver 95% of its solid waste (net of recyclable and construction debris) or 150 thousand tons per year, whichever is greater. The current contract ends May 15, 2018. The new contract with Republic Services will go into effect May 16, 2018 and concludes on January 15, 2028. At the end of 2017, Snohomish County was paying Republic Services $53.15 per ton for disposal of municipal solid waste delivered from the County transfer stations. The County paid Republic Services $29 million in 2017. Annual encumbrances related to this contract are established at the beginning of each year.

Future of Flight Beginning December 15, 2005, Snohomish County leased a portion of the Future of Flight to the Boeing Company through June 15, 2030. The lease for the building has a set annual lease amount that ties to their pro-rated portion of debt service through the life of the lease. In addition, Boeing pays a land rent for their footprint of the building with rent adjusted to fair market value every 5 years.

The leased space is used for Boeing Tour Center related activities, including theater and conference presentations, special events, educational programs, and a gift shop. Boeing and Snohomish County agree to jointly market the facility.

Dreamlifter Operations Center The Dreamlifter Operations Center was constructed in 2013 and funded with a 20 year bond. The facility is leased to the Boeing Company with a set annual lease amount at fair market value which funds the building’s debt service. In addition, Boeing pays a land rent for the facility and additional ramp area, with rent adjusted to fair market value every 3 years.

Construction At December 31, 2017, the County had pending construction project contracts in progress. The commitments related to the remaining contract balances are summarized as follows:

82 Notes to the Financial Statements December 31, 2017

Expended Through Remaining 12/31/2017 Commitment Governmental Activities County Roads $ 64,606,033 $ 12,004,523 Parks Construction 7,036,661 3,247,111 Facilities 11,043,211 3,962,752 Total Governmental Activities 82,685,905 19,214,386

Business-Type Activities Airport 7,727,446 7,244,583 Solid Waste 7,433,347 427,271 Surface Water 21,994,976 3,719,938 Total Business-type Activities 37,155,769 11,391,792

Total Primary Government $ 119,841,674 $ 30,606,178

All significant encumbrances for construction contracts are included in the above amounts and are established at the beginning of each year.

Operating Leases The County leases office buildings under cancellable operating leases. Total cost for such leases was $594 thousand for the year ended December 31, 2017. The future minimum lease payments for these leases are as follows:

Year Ending December 31 Amount 2018 $ 413,234 2019 414,272 2020 339,406 2021 244,487 2022 240,283 2023-2027 707,385 Total $ 2,359,068

The County leases certain properties to various tenants under cancellable operating lease agreements. As one of its enterprise activities, the Airport Fund leases out buildings and grounds to various individuals and companies in the aviation field. The Solid Waste Fund leases out property to a company that provides operations related to the transshipment of solid waste for disposal at a landfill.

83 Notes to the Financial Statements December 31, 2017

Enterprise Property Under Long Term Lease Activities Land $ 15,581,580 Buildings 79,286,516 Less Depreciation (27,981,711) Total Property Leased to Others, Net $ 66,886,385

Concession Agreements Snohomish County currently has two concession arrangements, the Kayak Point Golf Course and the motor sport and multi-event venue located at the Evergreen State Fairgrounds.

Snohomish County entered into an agreement with Access Golf Management, LLC under which they will operate and collect user fees from the Kayak Point Golf Course until 2019. Access Golf Management, LLC will pay Snohomish County a base payment five times each year of $18 thousand, $90,000 annually. The present value of the future installment payments is $172 thousand. Access Golf Management, LLC is required to operate and maintain the golf course in accordance with the contract.

Snohomish County entered into an agreement with High Road Promotions, LLC under which they will operate and collect user fees from the motor sport and multi-event venue located at the Evergreen State Fairgrounds until November 1, 2026. High Road Promotions, LLC will pay Snohomish County a base installment payment six times each year. The present value of the future installment payments is $982 thousand. They will also pay Snohomish County a ticket revenue sharing payment monthly.

Snohomish County reports a receivable and deferred inflow of resources in the amount of $1.2 million at year end pursuant to the service concession arrangements.

Grant Program Involvement The County participates in various federal or state grant/loan programs. The grant/loan programs are often subject to additional audits by agents of the granting or loaning agency, the purpose of which is to ensure compliance with the specific conditions of the grant or loan. Any liability for reimbursement that may arise as a result of these audits cannot be reasonably determined at this time, although it is believed the amount, if any, would not be material.

Environmental Liabilities Snohomish County maintains and monitors several landfills throughout the County. The level of attention for each landfill differs, but at a minimum all sites require visual inspections on a routine basis. These landfills, except for the Cathcart landfill, were closed before October 4, 1988, and are not required to have financial assurance plans as identified in WAC 173-304-407 and 173-304-467, but still must be managed and monitored on a regular basis.

In 2016, under the terms of a settlement agreement, the County agreed to take ownership of a landfill and certain surrounding property necessary to provide an appropriate environmental buffer. The County received a total of $6,625,000 from the former owner

84 Notes to the Financial Statements December 31, 2017

(through their insurers) and other liable parties to pay for the costs of clean-up, closing, and long-term monitoring of the Landfill which is currently reported as a liability. The County has contracted with a consultant to obtain reasonable estimates for closure and post-closure costs, that information is not presently available. The landfill is currently inactive and the County is in the process of closing the landfill in compliance with state, local, and federal requirements.

Snohomish County performs certain maintenance and monitoring functions to the closed Cathcart Landfill site as required by state, local, and federal laws and regulations. These functions are performed for a minimum of twenty years after closure or until the site is stabilized. The landfill was closed in 1992; therefore, we consider landfill capacity 100% used to date with zero years remaining landfill life. The 2007 post-closure plan update resulted in increased estimates in annual maintenance and monitoring costs as well as extended the date that required monitoring will cease. In 2011, and again in 2014, the plan was adjusted to more currently reflect estimated interest income and expenses. The restricted landfill post-closure investment account established for the purpose of paying the liability is $2.3 million at December 31, 2017. The current portion of the post closure liability is $417 thousand. It is anticipated that future inflation costs will be financed in part from earnings on the investment account. The actual cost of post- closure care may be further adjusted in the future due to inflation or deflation, changes in technology, or changes in applicable laws and regulations.

Landfill Post-Closure Estimates Beginning Interest Annual Ending Fund Year Balance Income Expense Balance 2017 2,671,470 38,202 407,132 2,302,540 2018 2,302,540 32,926 416,781 1,918,685 2019 1,918,685 27,437 426,659 1,519,464 2020 1,519,464 21,728 436,770 1,104,422 2021 1,104,422 15,793 447,122 673,093 2022 673,093 9,625 457,719 225,000 Interest Rate 1.43% Inflation Rate 2.37%

Litigation The County is a party to various legal proceedings which normally occur in the course of governmental operations. The financial statements include actuarial accruals for loss contingencies that may result from these proceedings.

Note 5 Reconciliation of Government-Wide and Fund Financial Statements

5.A Explanation of Differences between the Governmental Fund Balance Sheet and the Government-Wide Statement of Net Position

Total fund balances for the governmental funds balance sheet differs from net position of governmental activities as reported in the statement of net position due to the accounting methods used to prepare these statements. The governmental funds balance

85 Notes to the Financial Statements December 31, 2017

sheet is presented on a modified accrual basis and the statement of net position is presented on a full accrual basis. In addition, net internal service fund activity is included in government activities on the statement of net position. Details of the differences between these two presentations are as follows:

Capital Related Items When capital assets that are to be used in governmental activities are purchased or constructed, the cost of those assets are reported as expenditures in governmental funds. However, the statement of net position included those capital assets among the assets of the County as a whole.

Costs of Capital Assets $ 1,968,680,429 Accumulated Depreciation (739,776,203) Capital Assets, Net 1,228,904,226

Investment in Joint Venture 5,274,424 Total Capital Assets $ 1,234,178,650

Long-Term Debt Transactions Long-term liabilities and related deferred charges applicable to the County’s governmental debt activities are not due and payable in the current period, and accordingly, are not reported at the fund level. All debt liabilities (both current and long- term) are reported in the statement of net position.

Unamortized Bond Premiums, Discounts, and Deferred Gain/Loss $ (11,357,522) Interest Payable on Long-Term Debt (Accrued Liabilities) (3,629,726) Current Portion of Long-Term Debt (12,974,367) Noncurrent Portion of Long-Term Debt (279,759,975) Total Long-Term Debt $ (307,721,590)

Internal Service Funds The internal service funds are included in governmental activities in the statement of net position because they primarily serve governmental activities of the County.

Internal Service Funds Total Current Assets $ 60,508,502 Internal Service Funds Total Non-Current Assets, Net 42,207,201 Internal Service Funds Total Assets 102,715,703

Internal Service Funds Total Deferred Outflow of Resources 1,879,272

Internal Service Funds Total Current Liabilities (30,558,810) Internal Service Funds Total Non-Current Liabilities (43,843,265) Internal Service Funds Total Liabilities (74,402,075)

Internal Service Funds Total Deferred Inflow of Resources (2,275,576)

Internal Service Funds Net Position $ 27,917,324

86 Notes to the Financial Statements December 31, 2017

Other Full Accrual Adjustments

Compensated Absences Payable $ (16,861,915) Pension Related Items (84,099,773) Offset to Unavailable Property Taxes 3,511,360 Interest and Penalties Receivable Property Tax 7,384,685 Offset to Unavailable Revenue 246,585 Accounts Receivable 51,749,152 Allowance for Bad Debts (45,081,250) Total $ (83,151,156)

5.B Explanation of Differences between Governmental Fund Operating Statements and the Statement of Activities

Details of the differences between these two presentations are as follows:

Capital Related Items When capital assets that are to be used in governmental activities are purchased or constructed, the resources expended for those assets are reported as expenditures in governmental funds. However, in the statement of activities, the costs of those assets are allocated over their estimated useful lives and reported as depreciation expense. As a result, fund balance decreases by the amount of financial resources expended, whereas net position decreases by the amount of depreciation expense charged for the year. In addition, assets donated or contributed to the County’s governmental activities do not provide current financial resources and, therefore, are not reported as revenues in governmental funds.

Capital Related Expenditures $ 26,335,133 Depreciation Expense (53,363,032) Subtotal (27,027,899) Contributions and Donations (Capital Donations) 59,131,346 Gain/Loss on Capital Assets (20,360,689) Equity Adjustment in Joint Venture (432,715) Subtotal 38,337,942 Increase (Decrease) in Net Position $ 11,310,043

Internal Service Funds Revenues and Expenses The revenues and expenses of the internal service funds are included in governmental activities in the statement of activities because they primarily serve governmental activities of the County.

Internal Service Funds Total Operating Revenues $ 119,719,698 Internal Service Funds Total Operating Expenses (121,653,467) Internal Service Funds Total Non-Operating Revenue/Expenses 620,254 Internal Service Funds Net Transfers & Contributions (2,791,498) Internal Service Funds Net Income (Loss) $ (4,105,013)

87 Notes to the Financial Statements December 31, 2017

Other Full Accrual Adjustments Some revenues and expenses reported in the statement of activities do not represent a change in current financial resources and, therefore, are not reported as revenues and expenditures in the governmental funds.

Adjustments to equity relating to long-term assets and liabilities do not require the use of current financial resources and, therefore, are not reported as expenditures or revenues in governmental funds.

Recognize Unavailable Property Taxes $ 1,431,730 Penalties and Interest on Property Taxes (470,126) Recognize Unavailable Revenue (13,865) Adjust Liability for Compensated Absences (637,032) Current portion of Other Governmental 800 MHz debt (337,201) Items related to Pensions 12,020,182 Court Fines 852,958 Allowance for Uncollectible Court Fines (779,055) Total Increase (Decrease) to Net Position $ 12,067,591

Note 6 Pollution Remediation Obligations

The Roads Division of the County’s Public Works Department currently has two adjacent parcels of land that may have pollution remediation impacts. The Washington State Department of Ecology (DOE) has given concurrence that no further remediation is needed on a portion of the property. However, at this time, it is unknown what, if any, remediation efforts DOE may require on the remaining property. DOE is reviewing the remaining property and will determine whether any further action is required to remediate the sites. There is currently no estimate for, nor means to estimate, the range of possible costs until DOE’s review is complete.

Note 7 Related Party Transactions

Snohomish County entered into an interlocal agreement with Snohomish County Emergency Radio Systems (SERS) for accounting services including preparation of financial statements. Pursuant to this agreement, SERS pays the County an annual fee of $48 thousand. The County may also receive reimbursements for various minor miscellaneous expenses.

Snohomish County entered into an interlocal agreement with Snohomish County Public Facilities District (PFD) for accounting services including preparation of financial statements. Pursuant to this agreement, the PFD pays the County an annual fee of $24 thousand. The County may also receive reimbursements for various minor miscellaneous expenses.

Note 8 Tax Abatements

As of December 31, 2017, the County has no direct tax abatement agreements.

88 Notes to the Financial Statements December 31, 2017

The County is affected indirectly by several State Tax Abatement agreements per Washington State RCW.

The State property tax abatements that affect the County are:

Amount of Taxes Abated State RCW Purpose for Snohomish County 84.14.020 Multi-Unit Urban housing exemption $ 102,926 84.36.010 (2) Tribal property used for Economic Development Purposes $ 354,509 84.36.020 (2) Non-profit churches, parsonages, and convents See note A below 84.36.255 Habitat and water quality improvements $ 748 39.104 Local Revitalization Financing $ 45,571 $ 503,754

The State sales, use and B&O tax abatements that affect the County are:

Amount of Taxes Abated State RCW Purpose for Snohomish County 82.63 High Technology Sales and Use Tax Deferral $ 165,599 82.75 Biotechnology and Medical Device Manufacturing See note B below Sales and Use Tax Deferral 82.08.975/ Exemption for Computer Hardware, Software and See note B below 82.12.975 Peripherals 82.08.980/ Exemption for Construction of New Facilities Used See note B below 82.12.980 to Manufacture Commercial Airplane Fuselages, or wings of Commercial Airplanes $ 165,599

A – Snohomish County is unable to break out this number in 2017. The State provided 2017 Fiscal Year information for the County as $5,585 for all categories combined under RCW 84.36.020 (2). The County is working on being able to split out these parcel types for future reporting.

B –The State has identified these abatements applying to Snohomish County, but because there are fewer than 3 taxpayers that received these deferral/exemption categories, the State is not legally allowed to disclose specific information per RCW 82.32.330 (2).

89 Required Supplementary Information

Schedule of Proportionate Share of the Collective Net Pension Liability Measurement Date of June 30

Public Employee's Retirement System (PERS) Plan 1 2017 2016 2015 2014 County's proportion of the net pension liability (asset) 1.38% 1.42% 1.45% 1.50% County's proportionate share of the net pension liability (asset) $ 65,640,277 $ 76,063,753 $ 75,995,317 $ 75,662,294 County's covered payroll $ 171,615,203 $ 165,779,406 $ 161,898,566 $ 160,440,861

County's proportionate share of the net pension liability as a percentage of covered employee payroll 38.25% 45.88% 46.94% 47.16% Plan fiduciary net position as a percentage of the total pension liability 61.24% 57.03% 59.10% 61.19%

Public Employee's Retirement System (PERS) Plan 2/3 County's proportion of the net pension liability (asset) 1.55% 1.57% 1.62% 1.65% County's proportionate share of the net pension liability (asset) $ 53,869,337 $ 79,203,889 $ 57,848,829 $ 33,426,580 County's covered payroll $ 152,223,707 $ 147,738,165 $ 143,614,259 $ 142,065,482

County's proportionate share of the net pension liability as a percentage of covered employee payroll 35.39% 53.61% 40.28% 23.53% Plan fiduciary net position as a percentage of the total pension liability 90.97% 85.82% 89.20% 93.29%

Public Safety Employee's Retirement System (PSERS) Plan 2 County's proportion of the net pension liability (asset) 4.35% 4.44% 4.97% 5.17% County's proportionate share of the net pension liability (asset) $ 852,592 $ 1,887,855 $ 907,347 $ (748,935) County's covered payroll $ 16,409,680 $ 14,454,705 $ 14,594,968 $ 13,914,281

County's proportionate share of the net pension liability (asset) as a percentage of covered employee payroll 5.20% 13.06% 6.22% -5.38% Plan fiduciary net position as a percentage of the total pension liability 96.26% 90.41% 95.08% 105.01%

Law Enforcement Officers' and Fire Fighters' Retirement System (LEOFF) Plan 1 County's proportion of the net pension asset 0.14% 0.14% 0.14% 0.14% County's proportionate share of the net pension liability (asset) $ (2,118,130) $ (1,452,168) $ (1,716,536) $ (1,680,686) State's proportionate share of the net pension liability (asset) associated with the employer $ (14,326,980) $ (9,822,425) $ (11,610,607) $ (11,368,118) TOTAL $ (16,445,110) $ (11,274,593) $ (13,327,143) $ (13,048,804)

County's covered payroll $ 51,635.43 $ - $ 20,265 $ 165,757

County's proportionate share of the net pension liability as a percentage of covered employee payroll -4102.09% 0.00% -8470.45% -1013.95% Plan fiduciary net position as a percentage of the total pension liability 135.96% 123.74% 127.36% 126.91%

Law Enforcement Officers' and Fire Fighters' Retirement System (LEOFF) Plan 2 County's proportion of the net pension asset 0.93% 0.88% 0.90% 0.92% County's proportionate share of the net pension liability (asset) $ (12,949,182) $ (5,114,360) $ (9,279,708) $ (12,204,854) State's proportionate share of the net pension liability (asset) associated with the employer $ (8,399,892) (3,334,272) (6,135,765) $ (7,974,418) TOTAL $ (21,349,074) $ (8,448,632) $ (15,415,473) $ (20,179,272)

County's covered payroll $ 29,241,264 $ 26,645,193 $ 26,265,067 $ 25,621,820 County's proportionate share of the net pension liability as a percentage of covered employee payroll -44.28% -19.19% -35.33% -47.63% Plan fiduciary net position as a percentage of the total pension liability 113.36% 106.04% 111.67% 116.75%

90 Required Supplementary Information

Snohomish County Schedule of Employer Contributions Fiscal Year Ended December 31

Public Employee's Retirement System (PERS) Plan 1 2017 2016 2015 2014 Statutorily or contractually required contributions $ 8,824,960 $ 8,282,395 $ 7,287,628 $ 6,768,308 Contributions in relation to the statutorily or contractually required contributions (8,824,960) (8,282,395) (7,287,628) (6,768,308) Contribution deficiency (excess) $ - $ - $ - $ - Covered payroll $ 176,137,494 $ 169,194,388 $ 161,386,889 $ 162,686,046 Contributions as a percentage of covered employee payroll 5.01% 4.90% 4.52% 4.16%

Public Employee's Retirement System (PERS) Plan 2/3 Statutorily or contractually required contributions $ 10,716,957 $ 9,669,931 $ 8,336,907 7,463,164 Contributions in relation to the statutorily or contractually required contributions (10,716,957) (9,669,931) (8,336,907) (7,463,164) Contribution deficiency (excess) $ - $ - $ - - Covered payroll $ 156,044,149 $ 150,869,349 $ 143,388,626 144,210,093 Contributions as a percentage of covered employee payroll 6.87% 6.41% 5.81% 5.18%

Public Safety Employee's Retirement System (PSERS) Plan 2 Statutorily or contractually required contributions $ 1,151,285 $ 1,016,186 $ 959,178 944,721 Contributions in relation to the statutorily or contractually required contributions (1,151,285) (1,016,186) (959,178) (944,721) Contribution deficiency (excess) $ - $ - $ - $ - Covered payroll $ 17,280,592 $ 15,010,156 $ 14,417,157 14,501,390 Contributions as a percentage of covered employee payroll 6.66% 6.77% 6.65% 6.51%

Law Enforcement Officers' and Fire Fighters' Retirement System (LEOFF) Plan 1 Statutorily or contractually required contributions $ - $ - $ - 181 Contributions in relation to the statutorily or contractually required contributions - - - -181 Contribution deficiency (excess) $ - $ - $ - Covered payroll $ 93,883 $ - $ - 100,374 Contributions as a percentage of covered employee payroll 0.00% 0.00% 0.00% 0.18%

Law Enforcement Officers' and Fire Fighters' Retirement System (LEOFF) Plan 2 Statutorily or contractually required contributions $ 1,552,239 $ 1,388,109 $ 1,385,668 1,350,939 Contributions in relation to the statutorily or contractually required contributions (1,552,239) (1,388,109) (1,385,668) (1,350,939) Contribution deficiency (excess) $ - $ - $ - - Covered payroll $ 30,172,900 $ 26,541,262 $ 26,494,598 25,830,473 Contributions as a percentage of covered employee payroll 5.14% 5.23% 5.23% 5.23%

91 Required Supplementary Information

Other Postemployment Benefits Plan (OPEB) Schedule of Funding Progress

Actuarial Actuary UAAL as a % Valuation Value of Funded Covered of Covered Date Assets AAL U AAL Ratio Payroll Payroll 1/1/2016 $ - $ 26,910,000 $ 26,910,000 0% $ - 0% 1/1/2013 - 27,036,000 27,036,000 0% 176,123 15351% 1/1/2010 - 19,461,733 19,461,733 0% 328,744 5920% 1/1/2007 - 19,861,839 19,861,839 0% 606,217 3276%

Employer Annual Fiscal Year Required Contribution Employer Percentage Ended (ARC) Contributions Contributed 12/31/2017 $ 1,830,864 $ 711,431 39% 12/31/2016 $ 1,830,864 $ 793,531 43% 12/31/2015 $ 1,799,762 $ 659,733 37%

92 Required Supplementary Information

Notes to the Required Supplementary Information

Note 1. Pensions – Methods and assumptions used in pension calculations

The Office of the State Actuary (OSA) calculates the actuarial determined contribution (ADC) based on the results of an actuarial valuation consistent with the state’s funding policy defined in RCW 41.45. The results of an actuarial valuation with an odd-numbered year valuation date determine the ACD for the biennium that follows two years later. For example, the actuarial valuation with a June 30, 2015, valuation date, completed in the fall of 2016, determines the ADC for the period beginning July 1, 2017, and ending June 30, 2019.

Governmental Accounting Standards Board (GASB) statement 68 was implemented for the fiscal year ended December 31, 2015. The RSI schedules for pensions will be built prospectively until they contain ten years of data. In the first year of presentation, there are no significant trends to explain such as changes in benefit terms or use of different assumptions.

Public Employee Retirement System (PERS) 1 funding is made up of PERS 1 contributions in addition to employer contributions based on PERS 2/3 and Public Safety Employee Retirement System (PSERS) as a percent of covered payroll for each of those plans.

Note 2. Other Post-Employment Benefits (OPEB) – Methods and assumptions used in OPEB calculations

The actuarial cost method used in the valuation of the OPEB plan is the entry age normal actuarial method. Previously, the projected unit credit method was used. See note 4A in the Notes to the Financial Statements for the assumptions used in the calculations.

93

Combining Financial Statements and Schedules Snohomish County, WA Combining Balance Sheet Other Governmental Funds December 31, 2017

Special Revenue Funds

Special Revenue River Corrections Convention & Crime Victims- Fund Management Commissary Performing Arts Witness ASSETS Cash and Cash Equivalents $ 7,725,316 $ 3,047 $ 394,706 $ 1,587,971 $ 47,937 Cash and Cash Equivalents, Restricted - - - - - Investments 2,482,173 - - 2,731,000 - Taxes Receivable - 727 - - - Other Receivables, Net 7,500 - 15,749 - - Interest Receivable 12,780 - - 14,703 - Due From Other Funds - - - - - Due From Other Governments 157,070 - - 421,091 20,740 Total Assets $ 10,384,839 $ 3,774 $ 410,455 $ 4,754,765 $ 68,677

LIABILITIES Accounts Payable 276,884 - 49,820 276,931 568 Due To Other Governments - - - 2,303 - Accrued Liabilities 6,227 - 82,506 4,778 7,688 Unearned Revenue - - - - - Total Liabilities 283,111 - 132,326 284,012 8,256

DEFERRED INFLOWS OF RESOURCES Unavailable Revenue-Property Tax - 727 - - - Unavailable Revenue - - - - - Total Deferred Inflows of Resources - 727 - - -

FUND BALANCES Restricted 6,496,156 704 278,129 4,427,821 46,366 Commited 3,605,572 2,343 - 42,932 14,055 Total Fund Balance 10,101,728 3,047 278,129 4,470,753 60,421

Total Liabilities, Deferred Inflows of Resources, and Fund Balances $ 10,384,839 $ 3,774 $ 410,455 $ 4,754,765 $ 68,677

94 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Balance Sheet Other Governmental Funds December 31, 2017

Special Revenue Funds

Sheriff-Search Arson & Rescue Sheriff Drug Investigation & Grant Control Helicopter Buy Equipment Tax Refund ASSETS Cash and Cash Equivalents $ (684,159) $ 72,636 $ 441,389 $ 58 $ 311,880 Cash and Cash Equivalents, Restricted 354,362 - - - - Investments - - - - - Taxes Receivable - - - - 9 Other Receivables, Net 196,208 - 662 - - Interest Receivable - - - - - Due From Other Funds - - - - - Due From Other Governments 2,512,343 - 45,396 - - Total Assets $ 2,378,754 $ 72,636 $ 487,447 $ 58 $ 311,889

LIABILITIES Accounts Payable 217,416 - 74,549 - - Due To Other Governments 543,277 - - - - Accrued Liabilities 111,249 - 188,422 - - Unearned Revenue 88,321 - - - - Total Liabilities 960,263 - 262,971 - -

DEFERRED INFLOWS OF RESOURCES Unavailable Revenue-Property Tax - - - - 9 Unavailable Revenue - - - - - Total Deferred Inflows of Resources - - - - 9

FUND BALANCES Restricted 10,961 72,636 219,223 - 311,880 Commited 1,407,530 - 5,253 58 - Total Fund Balance 1,418,491 72,636 224,476 58 311,880

Total Liabilities, Deferred Inflows of Resources, and Fund Balances $ 2,378,754 $ 72,636 $ 487,447 $ 58 $ 311,889

The notes to the financial statements are an integral part of this statement. 95 Snohomish County, WA Combining Balance Sheet Other Governmental Funds December 31, 2017

Special Revenue Funds

Emergency Evergreen Elections Services Fairground Auditor's Equipment Communications Cumulative Conservation Operation & Cumulative System Reserve Futures Tax Maintenance Reserve ASSETS Cash and Cash Equivalents $ 2,519,963 $ 1,572,647 $ 709,440 $ 1,581,925 $ 466,855 Cash and Cash Equivalents, Restricted - - 528,213 - - Investments 3,571,000 - 2,150,000 1,110,744 435,519 Taxes Receivable - - 87,761 - - Other Receivables, Net - 7,320 - - - Interest Receivable 22,864 - 11,357 5,831 2,286 Due From Other Funds - - - - - Due From Other Governments 1,326,635 - 6,637 - 87,386 Total Assets $ 7,440,462 $ 1,579,967 $ 3,493,408 $ 2,698,500 $ 992,046

LIABILITIES Accounts Payable 601,296 58,359 - 11,375 16,394 Due To Other Governments - - - - - Accrued Liabilities 6,439 1,193 9,934 4,208 - Unearned Revenue - - - - - Total Liabilities 607,735 59,552 9,934 15,583 16,394

DEFERRED INFLOWS OF RESOURCES Unavailable Revenue-Property Tax - - 69,736 - - Unavailable Revenue - - - - - Total Deferred Inflows of Resources - - 69,736 - -

FUND BALANCES Restricted 6,770,119 - 1,947,370 2,222,796 - Commited 62,608 1,520,415 1,466,368 460,121 975,652 Total Fund Balance 6,832,727 1,520,415 3,413,738 2,682,917 975,652

Total Liabilities, Deferred Inflows of Resources, and Fund Balances $ 7,440,462 $ 1,579,967 $ 3,493,408 $ 2,698,500 $ 992,046

96 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Balance Sheet Other Governmental Funds December 31, 2017

Special Revenue Funds

Snohomish County Tomorrow Real Estate Transportation Community Cumulative Reserve Excise Tax Mitigation Development Boating Safety ASSETS Cash and Cash Equivalents $ 152,508 $ 4,024,039 $ 2,636,977 $ 4,376,081 $ 112,989 Cash and Cash Equivalents, Restricted - - - - - Investments - 8,996,000 12,517,936 12,895,000 - Taxes Receivable - - - - - Other Receivables, Net - 169,951 - 34,953 - Interest Receivable - 51,809 61,623 65,144 - Due From Other Funds - - 2,000,000 - - Due From Other Governments - - - 42,917 21,054 Total Assets $ 152,508 $ 13,241,799 $ 17,216,536 $ 17,414,095 $ 134,043

LIABILITIES Accounts Payable 449 4,891 - 123,257 62 Due To Other Governments - - 186,988 - - Accrued Liabilities 1,092 - - 260,191 - Unearned Revenue - - - 6,101,774 - Total Liabilities 1,541 4,891 186,988 6,485,222 62

DEFERRED INFLOWS OF RESOURCES Unavailable Revenue-Property Tax - - - - - Unavailable Revenue - 169,951 - - - Total Deferred Inflows of Resources - 169,951 - - -

FUND BALANCES Restricted 149,764 12,916,045 17,029,548 4,754,744 - Commited 1,203 150,912 - 6,174,129 133,981 Total Fund Balance 150,967 13,066,957 17,029,548 10,928,873 133,981

Total Liabilities, Deferred Inflows of Resources, and Fund Balances $ 152,508 $ 13,241,799 $ 17,216,536 $ 17,414,095 $ 134,043

The notes to the financial statements are an integral part of this statement. 97 Snohomish County, WA Combining Balance Sheet Other Governmental Funds December 31, 2017

Special Revenue Funds

Fair Treasurer's Total Special Antiprofiteering Parks Sponsorships Operation & Revenue Revolving Mitigation & Donations Law Library Maint Funds ASSETS Cash and Cash Equivalents $ 80,314 $ 3,280,370 $ 15,766 $ 147,178 $ 98,770 $ 31,676,603 Cash and Cash Equivalents, Restricted - - - - - 882,575 Investments - - - - 800,000 47,689,372 Taxes Receivable - - - - - 88,497 Other Receivables, Net - - 3,594 40 76,634 512,611 Interest Receivable - - - - 4,200 252,597 Due From Other Funds - - - - - 2,000,000 Due From Other Governments - - - - - 4,641,269 Total Assets $ 80,314 $ 3,280,370 $ 19,360 $ 147,218 $ 979,604 $ 87,743,524

LIABILITIES Accounts Payable - - 5,729 224 4,070 1,722,274 Due To Other Governments - - - - - 732,568 Accrued Liabilities - - - - - 683,927 Unearned Revenue - - - - - 6,190,095 Total Liabilities - - 5,729 224 4,070 9,328,864

DEFERRED INFLOWS OF RESOURCES Unavailable Revenue-Property Tax - - - - - 70,472 Unavailable Revenue - - - - 76,634 246,585 Total Deferred Inflows of Resources - - - - 76,634 317,057

FUND BALANCES Restricted 79,641 3,280,370 - 146,994 826,475 61,987,742 Commited 673 - 13,631 - 72,425 16,109,861 Total Fund Balance 80,314 3,280,370 13,631 146,994 898,900 78,097,603

Total Liabilities, Deferred Inflows of Resources, and Fund Balances $ 80,314 $ 3,280,370 $ 19,360 $ 147,218 $ 979,604 $ 87,743,524

98 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Balance Sheet Other Governmental Funds December 31, 2017

Debt Service Funds

Sno Co Road Limited Tax Debt Road Improvement Improvement Total Debt Service Service Dist 24A Guaranty Funds ASSETS Cash and Cash Equivalents $ 82,565 $ - $ - $ 82,565 Cash and Cash Equivalents, Restricted - - - - Investments - - - - Taxes Receivable 1,089 - - 1,089 Other Receivables, Net - - - - Interest Receivable 6,879 - - 6,879 Due From Other Funds - - - - Due From Other Governments - - - - Total Assets $ 90,533 $ - $ - $ 90,533

LIABILITIES Accounts Payable - - - - Due To Other Governments - - - - Accrued Liabilities - - - - Unearned Revenue - - - - Total Liabilities - - - -

DEFERRED INFLOWS OF RESOURCES Unavailable Revenue-Property Tax 1,089 - - 1,089 Unavailable Revenue - - - - Total Deferred Inflows of Resources 1,089 - - 1,089

FUND BALANCES Restricted - - - - Commited 89,444 - - 89,444 Total Fund Balance 89,444 - - 89,444

Total Liabilities, Deferred Inflows of Resources, and Fund Balances $ 90,533 $ - $ - $ 90,533

The notes to the financial statements are an integral part of this statement. 99 Snohomish County, WA Combining Balance Sheet Other Governmental Funds December 31, 2017

Capital Projects Funds

Data Total Capital Total Other Parks Facility Processing Sno Co Arts Projects Governmental Construction Construction Capital Commission Funds Funds ASSETS Cash and Cash Equivalents $ 12,902,833 $ 2,187,603 $ 2,543,660 $ 200,780 $ 17,834,876 $ 49,594,044 Cash and Cash Equivalents, Restricted - 901,330 - - 901,330 1,783,905 Investments 15,000,000 - 1,883,000 - 16,883,000 64,572,372 Taxes Receivable - 34 - - 34 89,620 Other Receivables, Net 10,000 170 3,038 - 13,208 525,819 Interest Receivable 1,832 - 9,903 - 11,735 271,211 Due From Other Funds - - - - - 2,000,000 Due From Other Governments 1,311,720 69,623 28,711 - 1,410,054 6,051,323 Total Assets $ 29,226,385 $ 3,158,760 $ 4,468,312 $ 200,780 $ 37,054,237 $ 124,888,294

LIABILITIES Accounts Payable 757,082 172,799 148,204 6 1,078,091 2,800,365 Due To Other Governments - - - - - 732,568 Accrued Liabilities 147,640 19,072 3,207 - 169,919 853,846 Unearned Revenue - - - - - 6,190,095 Total Liabilities 904,722 191,871 151,411 6 1,248,010 10,576,874

DEFERRED INFLOWS OF RESOURCES Unavailable Revenue-Property Tax - 34 - - 34 71,595 Unavailable Revenue - - - - - 246,585 Total Deferred Inflows of Resources - 34 - - 34 318,180

FUND BALANCES Restricted 28,140,978 1,587,358 - 198,400 29,926,736 91,914,478 Commited 180,685 1,379,497 4,316,901 2,374 5,879,457 22,078,762 Total Fund Balance 28,321,663 2,966,855 4,316,901 200,774 35,806,193 113,993,240

Total Liabilities, Deferred Inflows of Resources, and Fund Balances $ 29,226,385 $ 3,158,760 $ 4,468,312 $ 200,780 $ 37,054,237 $ 124,888,294

100 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Statement of Revenues, Expenditures, and Changes in Fund Balance Other Governmental Funds For the Year Ended December 31, 2017

Special Revenue Funds

Special Revenue River Corrections Convention & Crime Victims- Fund Management Commissary Performing Arts Witness Detailed Revenues Property Taxes $ - $ 133 $ - $ - $ - Sales/Use Taxes - - - - - Real Estate Excise Tax - - - - - Business Taxes and Other Taxes 1,124,571 - - 3,208,503 - Charges for Services 215,765 - 832,828 - 292,852 Intergovernmental Revenues 187,593 - - - 86,716 Fines and Forfeitures 5,992 - - - - Interest and Investment Earnings 53,110 - - 42,932 - Rents, Leases, and Concessions - - - - - Contributions and Donations 285,576 - - - - Miscellaneous Revenues 108 - - 100 - Total Detail Revenues 1,872,715 133 832,828 3,251,535 379,568

Detailed Expenditures Current General Government 4,334 - - - 410,535 Judicial 129,052 - - - - Public Safety 153,793 - 759,496 - - Physical Environment - - - - - Economic Environment 698,307 - - 2,732,366 - Culture and Recreation 107,781 - - - - Debt Service Principal Payments - - - - - Interest and Other Charges - - - - - Capital Outlay 93,481 - - - - Total Detail Expenditures 1,186,748 - 759,496 2,732,366 410,535

Excess (deficiency) of revenues over (under) expenditures 685,967 133 73,332 519,169 (30,967)

Other Financial Sources (Uses) Disposition Of Capital Assets - - - - - Transfers In 54,793 - - - 37,824 Transfers Out (503,726) - - (419,973) - Total Other Financial Sources (Uses) (448,933) - - (419,973) 37,824

Net Change in Fund Balance 237,034 133 73,332 99,196 6,857

Fund Balance - Beginning 9,864,694 2,914 204,797 4,371,557 53,564 Fund Balance - Ending $ 10,101,728 $ 3,047 $ 278,129 $ 4,470,753 $ 60,421

The notes to the financial statements are an integral part of this statement. 101 Snohomish County, WA Combining Statement of Revenues, Expenditures, and Changes in Fund Balance Other Governmental Funds For the Year Ended December 31, 2017

Special Revenue Funds

Sheriff-Search & Rescue Arson Investigation Grant Control Helicopter Sheriff Drug Buy & Equipment Tax Refund Detailed Revenues Property Taxes $ - $ - $ - $ - $ - Sales/Use Taxes - - - - - Real Estate Excise Tax - - - - - Business Taxes and Other Taxes - - - - - Charges for Services 1,326,538 - - - - Intergovernmental Revenues 7,936,100 - - - - Fines and Forfeitures - - 773,159 - - Interest and Investment Earnings - 462 - - - Rents, Leases, and Concessions 32,278 - 11,070 - - Contributions and Donations 241,000 - - - - Miscellaneous Revenues - - - - - Total Detail Revenues 9,535,916 462 784,229 - -

Detailed Expenditures Current General Government 3,991,823 - - - - Judicial 418,670 - - - - Public Safety 5,377,282 - 549,673 - - Physical Environment - - - - - Economic Environment - - - - - Culture and Recreation - - - - - Debt Service Principal Payments 31,214 - - - - Interest and Other Charges - - - - - Capital Outlay 79,562 - 14,523 - - Total Detail Expenditures 9,898,551 - 564,196 - -

Excess (deficiency) of revenues over (under) expenditures (362,635) 462 220,033 - -

Other Financial Sources (Uses) Disposition Of Capital Assets - 1,062 - - - Transfers In 367,957 - - - - Transfers Out - - (126,384) (3,771) - Total Other Financial Sources (Uses) 367,957 1,062 (126,384) (3,771) -

Net Change in Fund Balance 5,322 1,524 93,649 (3,771) -

Fund Balance - Beginning 1,413,169 71,112 130,827 3,829 311,880 Fund Balance - Ending $ 1,418,491 $ 72,636 $ 224,476 $ 58 $ 311,880

102 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Statement of Revenues, Expenditures, and Changes in Fund Balance Other Governmental Funds For the Year Ended December 31, 2017

Special Revenue Funds Emergency Evergreen Elections Services Fairground Auditor's Equipment Communications Cumulative Conservation Operation & Cumulative System Reserve Futures Tax Maintenance Reserve Detailed Revenues Property Taxes $ - $ - $ 3,771,603 $ - $ - Sales/Use Taxes - - - - - Real Estate Excise Tax - - - - - Business Taxes and Other Taxes 7,921,930 - 41,665 - - Charges for Services - - - 489,302 253,421 Intergovernmental Revenues 22,350 50,000 2,478 228,357 - Fines and Forfeitures - - - - - Interest and Investment Earnings 62,608 5,349 29,574 24,340 7,841 Rents, Leases, and Concessions - 103,541 - - - Contributions and Donations - - - - - Miscellaneous Revenues - 39,897 - - - Total Detail Revenues 8,006,888 198,787 3,845,320 741,999 261,262

Detailed Expenditures Current General Government - - - 522,557 67,042 Judicial - - - - - Public Safety 7,783,627 - - - - Physical Environment - - 480,812 - - Economic Environment - - - - - Culture and Recreation - 182,671 - - - Debt Service Principal Payments - - - - - Interest and Other Charges - - - - - Capital Outlay 168,065 391,295 152,082 - - Total Detail Expenditures 7,951,692 573,966 632,894 522,557 67,042

Excess (deficiency) of revenues over (under) expenditures 55,196 (375,179) 3,212,426 219,442 194,220

Other Financial Sources (Uses) Disposition Of Capital Assets - - 31,349 - - Transfers In - 963,321 - - - Transfers Out - (434,072) (2,752,469) - (150,000) Total Other Financial Sources (Uses) - 529,249 (2,721,120) - (150,000)

Net Change in Fund Balance 55,196 154,070 491,306 219,442 44,220

Fund Balance - Beginning 6,777,531 1,366,345 2,922,432 2,463,475 931,432 Fund Balance - Ending $ 6,832,727 $ 1,520,415 $ 3,413,738 $ 2,682,917 $ 975,652

The notes to the financial statements are an integral part of this statement. 103 Snohomish County, WA Combining Statement of Revenues, Expenditures, and Changes in Fund Balance Other Governmental Funds For the Year Ended December 31, 2017

Special Revenue Funds

Snohomish County Tomorrow Real Estate Transportation Community Cumulative Reserve Excise Tax Mitigation Development Boating Safety Detailed Revenues Property Taxes $ - $ - $ - $ - $ - Sales/Use Taxes - - - - - Real Estate Excise Tax - 22,867,324 - - - Business Taxes and Other Taxes - - - - - Charges for Services - - 4,042,705 16,614,682 - Intergovernmental Revenues 77,178 - 86,590 25,955 88,720 Fines and Forfeitures - - - - - Interest and Investment Earnings 1,203 150,912 156,005 168,624 - Rents, Leases, and Concessions - - - - - Contributions and Donations - - - - - Miscellaneous Revenues - - - 31,988 43,028 Total Detail Revenues 78,381 23,018,236 4,285,300 16,841,249 131,748

Detailed Expenditures Current General Government - - - - - Judicial - - - - - Public Safety - - - 2,715,555 71,606 Physical Environment - - - - - Economic Environment 163,662 - - 13,760,420 - Culture and Recreation - 51,266 - - - Debt Service Principal Payments - - - - - Interest and Other Charges - - - - - Capital Outlay - - - 84,092 - Total Detail Expenditures 163,662 51,266 - 16,560,067 71,606

Excess (deficiency) of revenues over (under) expenditures (85,281) 22,966,970 4,285,300 281,182 60,142

Other Financial Sources (Uses) Disposition Of Capital Assets - - - - - Transfers In 60,439 - - - - Transfers Out - (20,321,972) (2,913,525) (519,695) - Total Other Financial Sources (Uses) 60,439 (20,321,972) (2,913,525) (519,695) -

Net Change in Fund Balance (24,842) 2,644,998 1,371,775 (238,513) 60,142

Fund Balance - Beginning 175,809 10,421,959 15,657,773 11,167,386 73,839 Fund Balance - Ending $ 150,967 $ 13,066,957 $ 17,029,548 $ 10,928,873 $ 133,981

104 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Statement of Revenues, Expenditures, and Changes in Fund Balance Other Governmental Funds For the Year Ended December 31, 2017

Special Revenue Funds

Fair Treasurer's Total Special Antiprofiteering Parks Sponsorships Operation & Revenue Revolving Mitigation & Donations Law Library Maint Funds Detailed Revenues Property Taxes $ - $ - $ - $ - $ - $ 3,771,736 Sales/Use Taxes ------Real Estate Excise Tax - - - - - 22,867,324 Business Taxes and Other Taxes - - - - - 12,296,669 Charges for Services - 2,048,915 - 255,163 239,488 26,611,659 Intergovernmental Revenues - - - - - 8,792,037 Fines and Forfeitures - - - - - 779,151 Interest and Investment Earnings 673 27,120 1 - 9,108 739,862 Rents, Leases, and Concessions - - - - - 146,889 Contributions and Donations - - 253,135 - - 779,711 Miscellaneous Revenues - - 9,649 540 - 125,310 Total Detail Revenues 673 2,076,035 262,785 255,703 248,596 76,910,348

Detailed Expenditures Current General Government - - - - 67,288 5,063,579 Judicial - - - - - 547,722 Public Safety - - - - - 17,411,032 Physical Environment - - - - - 480,812 Economic Environment - - - - - 17,354,755 Culture and Recreation - - 279,925 346,516 - 968,159 Debt Service Principal Payments - - - - - 31,214 Interest and Other Charges ------Capital Outlay - - - - - 983,100 Total Detail Expenditures - - 279,925 346,516 67,288 42,840,373

Excess (deficiency) of revenues over (under) expenditures 673 2,076,035 (17,140) (90,813) 181,308 34,069,975

Other Financial Sources (Uses) Disposition Of Capital Assets - - - - - 32,411 Transfers In - - - - - 1,484,334 Transfers Out - (1,884,296) - - (346,418) (30,376,301) Total Other Financial Sources (Uses) - (1,884,296) - - (346,418) (28,859,556)

Net Change in Fund Balance 673 191,739 (17,140) (90,813) (165,110) 5,210,419

Fund Balance - Beginning 79,641 3,088,631 30,771 237,807 1,064,010 72,887,184 Fund Balance - Ending $ 80,314 $3,280,370 $ 13,631 $ 146,994 $ 898,900 $ 78,097,603

The notes to the financial statements are an integral part of this statement. 105 Snohomish County, WA Combining Statement of Revenues, Expenditures, and Changes in Fund Balance Other Governmental Funds For the Year Ended December 31, 2017

Debt Service Funds

Sno Co Road Limited Tax Debt Road Improvement Improvement Total Debt Service Service Dist 24A Guaranty Funds Detailed Revenues Property Taxes $ 109 $ - $ - $ 109 Sales/Use Taxes - - - - Real Estate Excise Tax - - - - Business Taxes and Other Taxes - - - - Charges for Services 396,111 - - 396,111 Intergovernmental Revenues 338,175 - - 338,175 Fines and Forfeitures - - - - Interest and Investment Earnings 36,273 6,626 673 43,572 Rents, Leases, and Concessions 4,341,377 - - 4,341,377 Contributions and Donations - - - - Miscellaneous Revenues 13,458 73,413 - 86,871 Total Detail Revenues 5,125,503 80,039 673 5,206,215

Detailed Expenditures Current General Government - - - - Judicial - - - - Public Safety - - - - Physical Environment - - - - Economic Environment - - - - Culture and Recreation - - - - Debt Service Principal Payments 13,060,759 - - 13,060,759 Interest and Other Charges 12,344,802 196 - 12,344,998 Capital Outlay - - - - Total Detail Expenditures 25,405,561 196 - 25,405,757

Excess (deficiency) of revenues over (under) expenditures (20,280,058) 79,843 673 (20,199,542)

Other Financial Sources (Uses) Disposition Of Capital Assets - - - - Transfers In 20,286,963 - - 20,286,963 Transfers Out - (136,258) (170,750) (307,008) Total Other Financial Sources (Uses) 20,286,963 (136,258) (170,750) 19,979,955

Net Change in Fund Balance 6,905 (56,415) (170,077) (219,587)

Fund Balance - Beginning 82,539 56,415 170,077 309,031 Fund Balance - Ending $ 89,444 $ - $ - $ 89,444

106 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Statement of Revenues, Expenditures, and Changes in Fund Balance Other Governmental Funds For the Year Ended December 31, 2017

Capital Project Funds

Data Total Capital Total Other Parks Facility Processing Sno Co Arts Projects Governmental Construction Construction Capital Commission Funds Funds Detailed Revenues Property Taxes $ - $ - $ - $ - $ - $ 3,771,845 Sales/Use Taxes - - 350,000 - 350,000 350,000 Real Estate Excise Tax - - - - - 22,867,324 Business Taxes and Other Taxes - - - - - 12,296,669 Charges for Services 100,000 1,199,997 - - 1,299,997 28,307,767 Intergovernmental Revenues 534,371 665,786 - - 1,200,157 10,330,369 Fines and Forfeitures - - - - - 779,151 Interest and Investment Earnings 2,917 17,487 37,165 - 57,569 841,003 Rents, Leases, and Concessions - - - 1,190 1,190 4,489,456 Contributions and Donations - - 60,000 - 60,000 839,711 Miscellaneous Revenues 10,001 - 35,727 - 45,728 257,909 Total Detail Revenues 647,289 1,883,270 482,892 1,190 3,014,641 85,131,204

Detailed Expenditures Current General Government - 231,981 1,498,313 - 1,730,294 6,793,873 Judicial - 118,624 - - 118,624 666,346 Public Safety 262 35,475 - - 35,737 17,446,769 Physical Environment - - - - - 480,812 Economic Environment - - - - - 17,354,755 Culture and Recreation 3,108,673 - - 19,990 3,128,663 4,096,822 Debt Service Principal Payments - - - - - 13,091,973 Interest and Other Charges - - - - - 12,344,998 Capital Outlay 4,819,551 2,294,245 341,088 - 7,454,884 8,437,984 Total Detail Expenditures 7,928,486 2,680,325 1,839,401 19,990 12,468,202 80,714,332

Excess (deficiency) of revenues over (under) expenditures (7,281,197) (797,055) (1,356,509) (18,800) (9,453,561) 4,416,872

Other Financial Sources (Uses) Disposition Of Capital Assets 11,185,457 - - - 11,185,457 11,217,868 Transfers In 11,668,431 4,699,392 1,501,000 26,902 17,895,725 39,667,022 Transfers Out (372,363) - - - (372,363) (31,055,672) Total Other Financial Sources (Uses) 22,481,525 4,699,392 1,501,000 26,902 28,708,819 19,829,218

Net Change in Fund Balance 15,200,328 3,902,337 144,491 8,102 19,255,258 24,246,090

Fund Balance - Beginning 13,121,335 (935,482) 4,172,410 192,672 16,550,935 89,747,150 Fund Balance - Ending $ 28,321,663 $ 2,966,855 $ 4,316,901 $ 200,774 $ 35,806,193 $ 113,993,240

The notes to the financial statements are an integral part of this statement. 107 Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Special Revenue Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 2,045,570 $ 2,045,570 $ 9,864,694 $ 7,819,124

Resources (inflows) Business and Other Taxes 1,210,996 1,210,996 1,124,571 (86,425) Charges for Services 252,510 252,510 215,766 (36,744) Intergovernmental Revenues 200,000 200,000 187,593 (12,407) Fines and Forfeitures - 4,876 5,992 1,116 Interest and Investment Earnings 389,378 389,378 53,110 (336,268) Contributions and Donations 620,300 620,300 285,576 (334,724) Miscellaneous Revenues - - 108 108 Transfers In 54,793 54,793 54,793 - Total Resources (inflows) 2,727,977 2,732,853 1,927,509 (805,344)

Amounts Available for Appropriation 4,773,547 4,778,423 11,792,203 7,013,780

Charges to Appropriations (outflows) Executive Economic Development 173,327 173,327 79,290 94,037 Planning & Development Services Code Enforcement 50,000 50,000 - 50,000 Parks and Recreation Administration 2,106,125 2,106,125 698,307 1,407,818 Division Management 447,000 447,000 29,741 417,259 Auditor Licensing 3,500 3,500 142 3,358 Nondepartmental Trial Court Improvement 394,500 394,500 210,674 183,826 Brightwater Mitigation 1,000,000 1,000,000 403,726 596,274 ITAC Support 100,000 100,000 100,000 - District Court Probation & Parole Services - 4,876 466 4,410 Sheriff Patrol 225,000 225,000 152,082 72,918 Prosecuting Attorney Community Impact 107,195 107,195 4,192 103,003 Superior Court Investigations/Diagnosis 75,000 75,000 591 74,409 Juvenile Court Operations 31,900 31,900 10,231 21,669 Superior Court Operations 60,000 60,000 1,033 58,967 Amount Charged to Appropriations (outflows) 4,773,547 4,778,423 1,690,475 3,087,948

Budgeted Fund Balance, December 31 $ - $ - $ 10,101,728 $ 10,101,728

108 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Corrections Commissary Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 1 $ 1 $ 204,797 $ 204,796

Resources (inflows) Charges for Services 1,034,979 1,034,979 832,828 (202,151) Miscellaneous Revenues 120,021 120,021 - (120,021) Total Resources (inflows) 1,155,000 1,155,000 832,828 (322,172)

Amounts Available for Appropriation 1,155,001 1,155,001 1,037,625 (117,376)

Charges to Appropriations (outflows) Corrections Commissary 1,155,001 1,155,001 759,496 395,505 Amount Charged to Appropriations (outflows) 1,155,001 1,155,001 759,496 395,505

Budgeted Fund Balance, December 31 $ - $ - $ 278,129 $ 278,129

Convention & Performing Arts Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 762,749 $ 762,749 $ 4,371,557 $ 3,608,808

Resources (inflows) Business and Other Taxes 3,136,742 3,136,742 3,208,503 71,761 Interest and Investment Earnings 18,240 18,240 42,932 24,692 Miscellaneous Revenues - - 100 100 Total Resources (inflows) 3,154,982 3,154,982 3,251,535 96,553

Amounts Available for Appropriation 3,917,731 3,917,731 7,623,092 3,705,361

Charges to Appropriations (outflows) Parks & Recreation Economic Development 3,917,731 3,917,731 3,152,339 765,392 Amount Charged to Appropriations (outflows) 3,917,731 3,917,731 3,152,339 765,392

Budgeted Fund Balance, December 31 $ - $ - $ 4,470,753 $ 4,470,753

The notes to the financial statements are an integral part of this statement. 109 Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Crime Victims-Witness Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 533 $ 533 $ 53,564 $ 53,031

Resources (inflows) Charges for Services 339,690 339,690 292,852 (46,838) Intergovernmental Revenues 65,000 65,000 86,716 21,716 Interest and Investment Earnings 4 4 - (4) Miscellaneous Revenue 152 152 - (152) Transfers In 37,824 37,824 37,824 - Total Resources (inflows) 442,670 442,670 417,392 (25,278)

Amounts Available for Appropriation 443,203 443,203 470,956 27,753

Charges to Appropriations (outflows) Prosecuting Attorney Crime Victim Services 443,203 443,203 410,535 32,668 Amount Charged to Appropriations (outflows) 443,203 443,203 410,535 32,668

Budgeted Fund Balance, December 31 $ - $ - $ 60,421 $ 60,421

110 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Grant Control Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 162,340 $ 162,340 $ 1,413,169 $ 1,250,829

Resources (inflows) Charges for Services 1,151,593 1,151,593 1,326,538 174,945 Intergovernmental Revenues 11,139,813 11,241,480 7,936,100 (3,305,380) Rent, Leases, and Concessions 32,278 32,278 32,278 - Contributions and Donations 242,840 242,840 241,000 (1,840) Miscellaneous Revenues 2,001,771 1,900,104 - (1,900,104) Transfers In 353,601 353,601 367,957 14,356 Total Resources (inflows) 14,921,896 14,921,896 9,903,873 (5,018,023)

Amounts Available for Appropriation 15,084,236 15,084,236 11,317,042 (3,767,194)

Charges to Appropriations (outflows) Facilities EECBG ARRA Grant 150,000 150,000 - 150,000 Nondepartmental Grant Administration 2,000,000 1,898,333 - 1,898,333 Miscellaneous 73,404 73,404 - 73,404 Airport CERB 31,214 31,214 31,214 - Sheriff Sheriff Grants 2,949,000 2,949,000 2,233,650 715,350 Prosecuting Attorney Financial Fraud & ID Theft 141,576 141,576 141,576 - Stop Grant 149,926 149,926 149,920 6 Failure to Register Grant 149,926 149,926 149,233 693 Auto Theft Task Force 190,421 240,421 223,984 16,437 Family Support 3,561,993 3,561,993 3,077,002 484,991 Prosecuting Attorney Grants 222,840 222,840 200,639 22,201 Felony Traffic Offender - 50,000 49,468 532 Superior Court Community Corrections 1,984,268 1,984,268 1,502,295 481,973 Expansion Programs 378,144 378,144 331,138 47,006 VGAL Program 272,077 272,077 214,274 57,803 Unified Family Court 93,946 95,613 87,913 7,700 Juvenile Court Operations 22,005 22,005 14,950 7,055 Superior Court Operations 142,379 142,379 61,295 81,084 Department of Emergency Management DEM Operations 2,571,117 2,571,117 1,430,000 1,141,117 Amount Charged to Appropriations (outflows) 15,084,236 15,084,236 9,898,551 5,185,685

Budgeted Fund Balance, December 31 $ - $ - $ 1,418,491 $ 1,418,491

The notes to the financial statements are an integral part of this statement. 111 Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Sheriff-Search & Rescue Helicopter Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 41,596 $ 41,596 $ 71,112 $ 29,516

Resources (inflows) Interest and Investment Earnings - - 462 462 Transfers In 38,404 38,404 - (38,404) Disposition of Capital Assets - - 1,062 1,062 Total Resources (inflows) 38,404 38,404 1,524 (36,880)

Amounts Available for Appropriation 80,000 80,000 72,636 (7,364)

Charges to Appropriations (outflows) Sheriff Search and Rescue 80,000 80,000 - 80,000 Amount Charged to Appropriations (outflows) 80,000 80,000 - 80,000

Budgeted Fund Balance, December 31 $ - $ - $ 72,636 $ 72,636

Sheriff Drug Buy Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 1,423 $ 1,423 $ 130,827 $ 129,404

Resources (inflows) Fines and Forfeitures 874,500 874,500 773,159 (101,341) Interest and Investment Earnings 500 500 - (500) Rents, Leases, and Concessions - - 11,070 11,070 Total Resources (inflows) 875,000 875,000 784,229 (90,771)

Amounts Available for Appropriation 876,423 876,423 915,056 38,633

Charges to Appropriations (outflows) Sheriff Narcotics Enforcement 876,423 876,423 690,580 185,843 Amount Charged to Appropriations (outflows) 876,423 876,423 690,580 185,843

Budgeted Fund Balance, December 31 $ - $ - $ 224,476 $ 224,476

112 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Arson Investigation & Equipment Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 3,771 $ 3,771 $ 3,829 $ 58

Resources (inflows) Charges for Services - - - - Total Resources (inflows) - - - -

Amounts Available for Appropriation 3,771 3,771 3,829 58

Charges to Appropriations (outflows) Planning & Community Development Arson Investigation & Equipment 3,771 3,771 3,771 - Amount Charged to Appropriations (outflows) 3,771 3,771 3,771 -

Budgeted Fund Balance, December 31 $ - $ - $ 58 $ 58

Tax Refund Fund Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 5,000 $ 5,000 $ 311,880 $ 306,880

Resources (inflows) Property Taxes - - - - Total Resources (inflows) - - - -

Amounts Available for Appropriation 5,000 5,000 311,880 306,880

Charges to Appropriations (outflows) Treasurer Administration 5,000 5,000 - 5,000 Amount Charged to Appropriations (outflows) 5,000 5,000 - 5,000

Budgeted Fund Balance, December 31 $ - $ - $ 311,880 $ 311,880

The notes to the financial statements are an integral part of this statement. 113 Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Emergency Services Communication System Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 2,154,955 $ 2,154,955 $ 6,777,531 $ 4,622,576

Resources (inflows) Business and Other Taxes 7,408,382 7,408,382 7,921,930 513,548 Intergovernmental Revenues 56,300 56,300 22,350 (33,950) Interest and Investment Earnings 11,143 11,143 62,608 51,465 Total Resources (inflows) 7,475,825 7,475,825 8,006,888 531,063

Amounts Available for Appropriation 9,630,780 9,630,780 14,784,419 5,153,639

Charges to Appropriations (outflows) Executive Emergency Services Communication 486,463 486,463 301,899 184,564 Nondepartmental Emergency Services Communication 9,144,317 9,144,317 7,649,793 1,494,524 Amount Charged to Appropriations (outflows) 9,630,780 9,630,780 7,951,692 1,679,088

Budgeted Fund Balance, December 31 $ - $ - $ 6,832,727 $ 6,832,727

Evergreen Fairground Cumulative Reserve Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 1,052,900 $ 1,052,900 $ 1,366,345 $ 313,445

Resources (inflows) Intergovernmental Revenues 25,000 25,000 50,000 25,000 Interest and Investment Earnings 500 500 5,349 4,849 Rents, Leases, and Concessions 110,000 110,000 103,542 (6,458) Miscellaneous Revenues 14,324 14,324 39,897 25,573 Transfers In 561,680 932,598 963,321 30,723 Total Resources (inflows) 711,504 1,082,422 1,162,109 79,687

Amounts Available for Appropriation 1,764,404 2,135,322 2,528,454 393,132

Charges to Appropriations (outflows) Parks & Recreation Fairgrounds Maintenance 1,764,404 2,135,322 1,008,039 1,127,283 Amount Charged to Appropriations (outflows) 1,764,404 2,135,322 1,008,039 1,127,283

Budgeted Fund Balance, December 31 $ - $ - $ 1,520,415 $ 1,520,415

114 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Conservation Futures Tax Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 2,845,981 $ 2,845,981 $ 2,922,432 $ 76,451

Resources (inflows) Property Taxes 3,538,000 3,538,000 3,771,603 233,603 Business and Other Taxes 20,000 20,000 41,665 21,665 Intergovernmental Revenues 30,000 30,000 2,478 (27,522) Interest and Investment Earnings 5,000 5,000 29,574 24,574 Disposition of Capital Assets - - 31,349 31,349 Total Resources (inflows) 3,593,000 3,593,000 3,876,669 283,669

Amounts Available for Appropriation 6,438,981 6,438,981 6,799,101 360,120

Charges to Appropriations (outflows) Parks & Recreation Conservation Futures 6,438,981 6,438,981 3,385,363 3,053,618 Amount Charged to Appropriations (outflows) 6,438,981 6,438,981 3,385,363 3,053,618

Budgeted Fund Balance, December 31 $ - $ - $ 3,413,738 $ 3,413,738

Auditor's Operation & Maintenance Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 458,232 $ 458,232 $ 2,463,475 $ 2,005,243

Resources (inflows) Charges for Services 460,000 460,000 489,302 29,302 Intergovernmental Revenues 200,000 200,000 228,357 28,357 Interest and Investment Earnings 10,000 10,000 24,340 14,340 Total Resources (inflows) 670,000 670,000 741,999 71,999

Amounts Available for Appropriation 1,128,232 1,128,232 3,205,474 2,077,242

Charges to Appropriations (outflows) Auditor Records Services 1,128,232 1,128,232 522,557 605,675 Amount Charged to Appropriations (outflows) 1,128,232 1,128,232 522,557 605,675

Budgeted Fund Balance, December 31 $ - $ - $ 2,682,917 $ 2,682,917

The notes to the financial statements are an integral part of this statement. 115 Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Elections Equipment Cumulative Reserve Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 96,284 $ 96,284 $ 931,432 $ 835,148

Resources (inflows) Charges for Services 206,936 206,936 253,421 46,485 Interest and Investment Earnings - - 7,841 7,841 Total Resources (inflows) 206,936 206,936 261,262 54,326

Amounts Available for Appropriation 303,220 303,220 1,192,694 889,474

Charges to Appropriations (outflows) Auditor Election Services 303,220 303,220 217,042 86,178 Amount Charged to Appropriations (outflows) 303,220 303,220 217,042 86,178

Budgeted Fund Balance, December 31 $ - $ - $ 975,652 $ 975,652

Snohomish County Tomorrow Cumulative Reserve Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 33,002 $ 33,002 $ 175,809 $ 142,807

Resources (inflows) Intergovernmental Revenues 77,177 77,177 77,178 1 Interest and Investment Earnings 600 600 1,203 603 Transfers In 60,439 60,439 60,439 - Total Resources (inflows) 138,216 138,216 138,820 604

Amounts Available for Appropriation 171,218 171,218 314,629 143,411

Charges to Appropriations (outflows) Planning & Development Services Snohomish County Tomorrow 171,218 171,218 163,662 7,556 Amount Charged to Appropriations (outflows) 171,218 171,218 163,662 7,556

Budgeted Fund Balance, December 31 $ - $ - $ 150,967 $ 150,967

116 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Real Estate Excise Tax Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 2,111,972 $ 2,111,972 $ 10,421,959 $ 8,309,987

Resources (inflows) Real Estate Excise Taxes 18,210,000 18,210,000 22,867,324 4,657,324 Interest and Investment Earnings 65,000 65,000 150,912 85,912 Total Resources (inflows) 18,275,000 18,275,000 23,018,236 4,743,236

Amounts Available for Appropriation 20,386,972 20,386,972 33,440,195 13,053,223

Charges to Appropriations (outflows) Nondepartmental SB 4872--REET 1 9,700,531 9,700,531 9,700,531 - SHB 2929--REET 2 10,686,441 10,686,441 10,672,707 13,734 Amount Charged to Appropriations (outflows) 20,386,972 20,386,972 20,373,238 13,734

Budgeted Fund Balance, December 31 $ - $ - $ 13,066,957 $ 13,066,957

Transportation Mitigation Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ - $ - $ 15,657,773 $ 15,657,773

Resources (inflows) Charges for Services 4,340,000 4,340,000 4,042,705 (297,295) Intergovernmental Revenues 85,000 85,000 86,590 1,590 Interest and Investment Earnings 61,000 61,000 156,005 95,005 Total Resources (inflows) 4,486,000 4,486,000 4,285,300 (200,700)

Amounts Available for Appropriation 4,486,000 4,486,000 19,943,073 15,457,073

Charges to Appropriations (outflows) Public Works Transportation Syst Impact Fee 4,486,000 4,486,000 2,913,525 1,572,475 Amount Charged to Appropriations (outflows) 4,486,000 4,486,000 2,913,525 1,572,475

Budgeted Fund Balance, December 31 $ - $ - $ 17,029,548 $ 17,029,548

The notes to the financial statements are an integral part of this statement. 117 Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Community Development Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 734,297 $ 734,297 $ 11,167,386 $ 10,433,089

Resources (inflows) Charges for Services 17,301,296 17,301,296 16,614,681 (686,615) Intergovernmental Revenues 9,500 9,500 25,955 16,455 Interest and Investment Earnings 92,500 92,500 168,624 76,124 Miscellaneous Revenues 3,925 3,925 31,988 28,063 Total Resources (inflows) 17,407,221 17,407,221 16,841,248 (565,973)

Amounts Available for Appropriation 18,141,518 18,141,518 28,008,634 9,867,116

Charges to Appropriations (outflows) Planning & Development Services Administration 1,373,555 1,373,555 1,371,283 2,272 Business Process & Development 820,037 820,037 91,428 728,609 Business Process and Technology 1,682,455 1,682,455 1,530,931 151,524 Permitting 9,247,169 9,247,169 9,209,575 37,594 Structural Review 4,904,644 4,904,644 4,876,544 28,100 Contingent Staffing 113,658 113,658 - 113,658 Amount Charged to Appropriations (outflows) 18,141,518 18,141,518 17,079,761 1,061,757

Budgeted Fund Balance, December 31 $ - $ - $ 10,928,873 $ 10,928,873

Boating Safety Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ - $ - $ 73,839 $ 73,839

Resources (inflows) Intergovernmental Revenues 108,000 108,000 88,720 (19,280) Miscellaneous Revenues 4,000 4,000 43,028 39,028 Total Resources (inflows) 112,000 112,000 131,748 19,748

Amounts Available for Appropriation 112,000 112,000 205,587 93,587

Charges to Appropriations (outflows) Sheriff Administration 112,000 112,000 71,606 40,394 Amount Charged to Appropriations (outflows) 112,000 112,000 71,606 40,394

Budgeted Fund Balance, December 31 $ - $ - $ 133,981 $ 133,981

118 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Antiprofiteering Revolving Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 79,103 $ 79,103 $ 79,641 $ 538

Resources (inflows) Interest and Investment Earnings 142 142 673 531 Total Resources (inflows) 142 142 673 531

Amounts Available for Appropriation 79,245 79,245 80,314 1,069

Charges to Appropriations (outflows) Prosecuting Attorney Criminal 79,245 79,245 - 79,245 Amount Charged to Appropriations (outflows) 79,245 79,245 - 79,245

Budgeted Fund Balance, December 31 $ - $ - $ 80,314 $ 80,314

Parks Mitigation Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ - $ - $ 3,088,631 $ 3,088,631

Resources (inflows) Charges for Services 1,864,296 1,864,296 2,048,915 184,619 Interest and Investment Earnings 20,000 20,000 27,120 7,120 Total Resources (inflows) 1,884,296 1,884,296 2,076,035 191,739

Amounts Available for Appropriation 1,884,296 1,884,296 5,164,666 3,280,370

Charges to Appropriations (outflows) Parks & Recreation Park Mitigation 1,884,296 1,884,296 1,884,296 - Amount Charged to Appropriations (outflows) 1,884,296 1,884,296 1,884,296 -

Budgeted Fund Balance, December 31 $ - $ - $ 3,280,370 $ 3,280,370

The notes to the financial statements are an integral part of this statement. 119 Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Fair Sponsorship & Donations Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ - $ - $ 30,771 $ 30,771

Resources (inflows) Charges for Services 11 11 - (11) Interest and Investment Earnings 100 100 1 (99) Contributions and Donations 426,348 426,348 253,135 (173,213) Miscellaneous Revenues 13,461 13,461 9,649 (3,812) Total Resources (inflows) 439,920 439,920 262,785 (177,135)

Amounts Available for Appropriation 439,920 439,920 293,556 (146,364)

Charges to Appropriations (outflows) Parks & Recreation Sponsorship 439,920 439,920 279,925 159,995 Amount Charged to Appropriations (outflows) 439,920 439,920 279,925 159,995

Budgeted Fund Balance, December 31 $ - $ - $ 13,631 $ 13,631

120 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Limited Tax Debt Service Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 11,170 $ 11,170 $ 82,539 $ 71,369

Resources (inflows) Property Taxes - - 109 109 Charges for Services 396,111 396,111 396,111 - Intergovernmental Revenues 354,066 354,066 338,175 (15,891) Interest and Investment Earnings - - 36,273 36,273 Rents, Leases, and Concessions 4,341,377 4,341,377 4,341,377 - Miscellaneous Revenues 16,598 16,598 13,458 (3,140) Transfers In 20,286,963 20,286,963 20,286,963 - Total Resources (inflows) 25,395,115 25,395,115 25,412,466 17,351

Amounts Available for Appropriation 25,406,285 25,406,285 25,495,005 88,720

Charges to Appropriations (outflows) Debt Service 1997 (Deferred) Bond Issue 1,050 1,050 1,050 - 2009B Bonds 477,116 477,116 477,115 1 2010 A Bonds 8,027,610 8,027,610 8,027,608 2 2010 B RZEDB 1,008,475 1,008,475 1,008,473 2 2011A (01 Refunding) 389,250 389,250 389,250 - 2011B (03 Refunding) 2,111,482 2,111,482 2,111,481 1 2011C (08 Cathcart Refunding) 2,282,115 2,282,115 2,282,115 - 2012 Bonds 443,750 443,750 443,750 - 2012 Refunding Bonds 376,700 376,700 376,400 300 2013 Bonds 4,956,050 4,956,050 4,956,050 - 2015 Bonds 5,332,687 5,332,687 5,332,269 418 Amount Charged to Appropriations (outflows) 25,406,285 25,406,285 25,405,561 724

Budgeted Fund Balance, December 31 $ - $ - $ 89,444 $ 89,444

The notes to the financial statements are an integral part of this statement. 121 Snohomish County, WA Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Other Governmental Funds For the Year Ended December 31, 2017

Road Improvement Dist 24A Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ 145,000 $ 145,000 $ 56,415 $ (88,585)

Resources (inflows) Interest and Investment Earnings 5,000 5,000 6,626 1,626 Miscellaneous Revenues - - 73,412 73,412 Total Resources (inflows) 5,000 5,000 80,038 75,038

Amounts Available for Appropriation 150,000 150,000 136,453 (13,547)

Charges to Appropriations (outflows) Debt Service RID 24 Long Term Debt Service 150,000 150,000 136,453 13,547 Amount Charged to Appropriations (outflows) 150,000 150,000 136,453 13,547

Budgeted Fund Balance, December 31 $ - $ - $ - $ -

Sno Co Arts Commission Budgeted Amounts Original Final Actual Variance Budgeted Fund Balance, January 1 $ - $ - $ 192,672 $ 192,672

Resources (inflows) Rents Leases and Concessions - - 1,190 1,190 Miscellaneous Revenues 200,000 200,000 - (200,000) Transfers In - - 26,902 26,902 Total Resources (inflows) 200,000 200,000 28,092 (171,908)

Amounts Available for Appropriation 200,000 200,000 220,764 20,764

Charges to Appropriations (outflows) Executive Arts Commission 200,000 200,000 19,990 180,010 Amount Charged to Appropriations (outflows) 200,000 200,000 19,990 180,010

Budgeted Fund Balance, December 31 $ - $ - $ 200,774 $ 200,774

122 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Statement of Net Position Internal Service Funds December 31, 2017 Governmental Activities (Internal Service Funds)

Equipment Rental Information Snohomish & Revolving Services County Insurance Pits and Quarries Employee Benefit ASSETS Current Assets Cash and Cash Equivalents $ 2,573,946 $ 3,741,156 $ 4,205,104 $ 493,217 $ 17,532,299 Cash and Cash Equivalents, Restricted - - 70,130 - - Investments 8,800,000 - - 792,468 15,800,535 Other Receivables, Net 5,300 20,740 63,936 - 151,353 Interest Receivable 46,987 - 494 4,222 81,240 Due From Other Governments 129,019 20,461 - - - Inventories 1,351,340 - - - - Total Current Assets 12,906,592 3,782,357 4,339,664 1,289,907 33,565,427

Non-Current Assets Capital assets Land 389,185 - - 3,493 - Buildings and Structures, Net 8,342,865 - - 1,034,968 - Other Improvements, Net 1,199,186 - - 179,195 - Machinery and Equipment, Net 28,650,666 181,756 - - - Construction in Progress 1,322,354 - - - - Intangibles, Net - 12,888 - - - Net Pension Asset - - - - - Total Non-Current Assets 39,904,256 194,644 - 1,217,656 -

Total Assets 52,810,848 3,977,001 4,339,664 2,507,563 33,565,427

DEFERRED OUTFLOW OF RESOURCES Deferred Loss on Refunding 82,047 - - - - Deferred Outflows Related to Pensions 371,966 732,315 261,076 - 47,094 Total Deferred Outflow of Resources 454,013 732,315 261,076 - 47,094 LIABILITIES Current Liabilities: Accounts Payable 957,954 386,842 356,578 - 1,709,431 Claims and Judgments Payable - - 5,106,668 - - Due to Other Funds - - 2,000,000 - - Accrued Liabilities 122,710 194,846 68,738 - 12,433 Unearned Revenue - 85,000 - - 4,358,449 Employee Benefits Payable 4,159 7,121 3,006 - 12,441,805 Bonds, Notes, and Loans Payable 331,690 - - - - Total Current Liabilities 1,416,513 673,809 7,534,990 - 18,522,118

Non-Current Liabilities Employee Benefits Payable 411,701 704,947 297,562 - 40,118 Other Post-Employment Benefits - - - - 7,464,793 Bonds, Notes, and Loans Payable 3,223,326 - - - - Claims and Judgments Payable - - 18,513,146 - - Net Pension Liability 2,656,007 5,232,645 1,966,970 - 336,271 Total Non-Current Liabilities 6,291,034 5,937,592 20,777,678 - 7,841,182

Total Liabilities 7,707,547 6,611,401 28,312,668 - 26,363,300

DEFERRED INFLOW OF RESOURCES Deferred Inflows Related to Pensions 471,592 928,492 321,992 - 59,324 Total Deferred Inflow of Resources 471,592 928,492 321,992 - 59,324

NET POSITION Net Investment in Capital Assets 37,334,288 194,644 - 1,217,657 -

Restricted for: Capital Purposes 7,751,434 - - - - Total Restricted Net Position 7,751,434 - - - - Unrestricted - (3,025,221) (24,033,920) 1,289,906 7,189,897 Total Net Position $ 45,085,722 $ (2,830,577) $ (24,033,920) $ 2,507,563 $ 7,189,897

The notes to the financial statements are an integral part of this statement. 123 Snohomish County, WA Combining Statement of Net Position Internal Service Funds December 31, 2017 Governmental Activities (Internal Service Funds)

Security Services Total Internal Facility Services Training Fund Fund Service Funds ASSETS Current Assets Cash and Cash Equivalents $ 3,560,581 $ 425,511 $ 614,126 $ 33,145,940 Cash and Cash Equivalents, Restricted - - - 70,130 Investments - - - 25,393,003 Other Receivables, Net 19,561 - 462 261,352 Interest Receivable 27 - - 132,970 Due From Other Governments 4,287 - - 153,767 Inventories - - - 1,351,340 Total Current Assets 3,584,456 425,511 614,588 60,508,502

Non-Current Assets Capital assets Land - - - 392,678 Buildings and Structures, Net - - - 9,377,833 Other Improvements, Net 468,173 - - 1,846,554 Machinery and Equipment, Net 283,521 7,014 47,503 29,170,460 Construction in Progress - - - 1,322,354 Intangibles, Net - - - 12,888 Net Pension Asset - - 84,434 84,434 Total Non-Current Assets 751,694 7,014 131,937 42,207,201

Total Assets 4,336,150 432,525 746,525 102,715,703

DEFERRED OUTFLOW OF RESOURCES Deferred Loss on Refunding - - - 82,047 Deferred Outflows Related to Pensions 321,059 31,964 31,751 1,797,225 Total Deferred Outflow of Resources 321,059 31,964 31,751 1,879,272 LIABILITIES Current Liabilities: Accounts Payable 845,665 11,599 121,683 4,389,752 Claims and Judgments Payable - - - 5,106,668 Due to Other Funds - - - 2,000,000 Accrued Liabilities 1,326,337 10,643 21,290 1,756,997 Unearned Revenue 70,416 - - 4,513,865 Employee Benefits Payable 3,161 129 457 12,459,838 Bonds, Notes, and Loans Payable - - - 331,690 Total Current Liabilities 2,245,579 22,371 143,430 30,558,810

Non-Current Liabilities Employee Benefits Payable 312,962 12,737 45,261 1,825,288 Other Post-Employment Benefits - - - 7,464,793 Bonds, Notes, and Loans Payable - - - 3,223,326 Claims and Judgments Payable - - - 18,513,146 Net Pension Liability 2,292,503 228,241 104,075 12,816,712 Total Non-Current Liabilities 2,605,465 240,978 149,336 43,843,265

Total Liabilities 4,851,044 263,349 292,766 74,402,075

DEFERRED INFLOW OF RESOURCES Deferred Inflows Related to Pensions 406,985 39,138 48,053 2,275,576 Total Deferred Inflow of Resources 406,985 39,138 48,053 2,275,576

NET POSITION Net Investment in Capital Assets 751,694 7,014 47,503 39,552,800

Restricted for: Capital Purposes - - - 7,751,434 Total Restricted Net Position - - - 7,751,434 Unrestricted (1,352,514) 154,988 389,954 (19,386,910) Total Net Position $ (600,820) $ 162,002 $ 437,457 $ 27,917,324

124 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Statement of Revenues, Expenses and Changes in Net Position Internal Service Funds For the Year Ended December 31, 2017

Governmental Activities (Internal Service Funds) Equipment Snohomish Rental & Information County Pits and Employee Revolving Services Insurance Quarries Benefit Operating Revenues Charges for Services $ 19,829,363 $ 18,216,095 $ 13,078,711 $ - $ 52,863,779 Rents, Leases, and Concessions 62,117 - - - - Total Operating Revenues 19,891,480 18,216,095 13,078,711 - 52,863,779

Operating Expenses Personnel Services 5,029,856 9,357,529 3,442,563 - 1,615,125 Supplies 6,361,065 717,057 27,889 - 610 Interfund-Intergovernmental Payments for Service 1,923,209 1,916,992 469,765 16,403 306,586 Depreciation 3,821,649 58,855 - 65,458 - Contractual Services 792,497 4,181,396 12,612,122 - 55,132,734 Total Operating Expenses 17,928,276 16,231,829 16,552,339 81,861 57,055,055

Operating Income (Loss) 1,963,204 1,984,266 (3,473,628) (81,861) (4,191,276)

Non-Operating Revenues (Expenses) Intergoverrnmental Revenues - - - - - Interest and Investment Earnings 106,272 10,275 2,206 9,358 223,531 Miscellaneous Revenues 6,837 89,018 6,011 - 1,915 Disposition of Capital Assets 235,079 - - - - Interest and Other Charges (117,715) - (1,025) - - Total Non-Operating Revenues (Expenses) 230,473 99,293 7,192 9,358 225,446

Income (Loss) Before Contributions and Transfers 2,193,677 2,083,559 (3,466,436) (72,503) (3,965,830)

Transfers In 678,702 - - - - Transfers Out (750) (1,401,000) - - - Change in Net Position 2,871,629 682,559 (3,466,436) (72,503) (3,965,830)

Net Position, Beginning 42,214,093 (3,513,136) (20,567,484) 2,580,066 11,155,727 Net Position, Ending $ 45,085,722 $ (2,830,577) $ (24,033,920) $2,507,563 $ 7,189,897

The notes to the financial statements are an integral part of this statement. 125 Snohomish County, WA Combining Statement of Revenues, Expenses and Changes in Net Position Internal Service Funds For the Year Ended December 31, 2017

Governmental Activities (Internal Service Funds)

Facility Security Total Internal Services Training Fund Services Fund Service Funds Operating Revenues Charges for Services $ 709,917 $ 860,773 $ 2,085,360 $ 107,643,998 Rents, Leases, and Concessions 12,013,583 - - 12,075,700 Total Operating Revenues 12,723,500 860,773 2,085,360 119,719,698

Operating Expenses Personnel Services 4,389,457 531,621 1,080,962 25,447,113 Supplies 563,654 20,364 16,318 7,706,957 Interfund-Intergovernmental Payments for Service 1,366,187 14,477 294,139 6,307,758 Depreciation 64,354 2,104 10,431 4,022,851 Contractual Services 4,579,509 141,109 729,421 78,168,788 Total Operating Expenses 10,963,161 709,675 2,131,271 121,653,467

Operating Income (Loss) 1,760,339 151,098 (45,911) (1,933,769)

Non-Operating Revenues (Expenses) Intergoverrnmental Revenues 31,364 - 6,236 37,600 Interest and Investment Earnings 253 - - 351,895 Miscellaneous Revenues 14,175 - - 117,956 Disposition of Capital Assets 9,369 - - 244,448 Interest and Other Charges (12,905) - - (131,645) Total Non-Operating Revenues (Expenses) 42,256 - 6,236 620,254

Income (Loss) Before Contributions and Transfers 1,802,595 151,098 (39,675) (1,313,515)

Transfers In - - - 678,702 Transfers Out (2,068,450) - - (3,470,200) Change in Net Position (265,855) 151,098 (39,675) (4,105,013)

Net Position, Beginning (334,965) 10,904 477,132 32,022,337 Net Position, Ending $ (600,820) $ 162,002 $ 437,457 $ 27,917,324

126 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Statement of Cash Flows Internal Service Funds For the Year Ended December 31, 2017

Governmental Activities - Internal Service Equipment Rental & Information Snohomish Pits and Employee Revolving Services County Insurance Quarries Benefit

Cash Flows from Operating Activities Receipts from Operations $ 20,249,789 $ 18,303,782 $ 14,066,815 $ - $ 53,159,244 Payments to Employees (5,188,703) (9,758,149) (3,523,826) - (682,544) Payments of Claims (7,075,329) (4,709,622) (11,070,183) (600) (46,016,106) Internal Activity - Payment to Other Funds (1,923,209) (1,916,992) (469,765) (16,403) (306,586) Total Cash Flows from Operating Activities 6,062,548 1,919,019 (996,959) (17,003) 6,154,008

Cash Flows from Capital and Related Financing Activities Capital Acquisition and Construction (7,743,568) - - - - Sale of Capital Assets 1,445,393 - - - - Principal Paid on Loans (409,463) - - - - Interest Paid on Loans (171,487) - (1,025) - - Total Cash Flows from Capital and Related Financing Activities (6,879,125) - (1,025) - -

Cash Flows from Non-Capital Financing Activities Intergovernmental Revenue (314) 26,365 - - - Miscellaneous Revenue 6,837 89,018 6,011 - 1,915 Transfers 1,899 (1,401,000) - - - Total Cash Flows from Non-Capital Financing Activities 8,422 (1,285,617) 6,011 - 1,915

Cash Flows from Investing Activities Interest on Investments 91,554 10,280 4,232 8,680 180,563 Purchase of Investments 750,000 - 511,954 - (2,500,000) Interfund Loans - - 2,000,000 - - Total Cash Flows from Investing Activities 841,554 10,280 2,516,186 8,680 (2,319,437)

Net Increase (Decrease) in Cash and Cash Equivalents 33,399 643,682 1,524,213 (8,323) 3,836,486 Cash and Cash Equivalents, January 1, 2017 2,540,547 3,097,474 2,751,021 501,540 13,695,813 Cash and Cash Equivalents, December 31, 2017 $ 2,573,946 $ 3,741,156 $ 4,275,234 $ 493,217 $ 17,532,299

Reconciliation of Operating Income to Net Cash Provided (Used) by Operating Activities Net Operating Income (loss) $ 1,963,204 $ 1,984,266 $ (3,473,628) $ (81,861) $ (4,191,276) Depreciation Expense 3,821,649 58,855 - 65,458 - Changes in Receivables, Net 358,309 2,687 988,104 - 5,775 Changes in Inventories (71,818) - - - - Changes in Accounts Payable & Other Liabilities (8,796) (126,789) 1,488,565 (600) 10,339,509 Net Cash Provided (Used) by Operating Activities $ 6,062,548 $ 1,919,019 $ (996,959) $ (17,003) $ 6,154,008

Non-Cash Investing, Capital and Related Financing Activities Contributions of Capital Assets $ 676,053 $ - $ - $ - $ -

The notes to the financial statements are an integral part of this statement. 127 Snohomish County, WA Combining Statement of Cash Flows Internal Service Funds For the Year Ended December 31, 2017

Governmental Activities - Internal Service

Security Services Total Internal Facility Services Training Fund Fund Service Funds

Cash Flows from Operating Activities Receipts from Operations $ 13,731,175 $ 860,775 $ 2,085,004 $ 122,456,584 Payments to Employees (4,526,670) (414,711) (1,109,554) (25,204,157) Payments of Claims (4,703,063) (150,877) (688,210) (74,413,990) Internal Activity - Payment to Other Funds (1,366,187) (14,477) (294,138) (6,307,757) Total Cash Flows from Operating Activities 3,135,255 280,710 (6,898) 16,530,680

Cash Flows from Capital and Related Financing Activities Capital Acquisition and Construction (128,238) - - (7,871,806) Sale of Capital Assets 9,369 - - 1,454,762 Principal Paid on Loans - - - (409,463) Interest Paid on Loans (12,905) - - (185,417) Total Cash Flows from Capital and Related Financing Activities (131,774) - - (7,011,924)

Cash Flows from Non-Capital Financing Activities Intergovernmental Revenue 55,133 - 6,235 87,419 Miscellaneous Revenue 14,175 - - 117,956 Transfers (2,068,450) - - (3,467,551) Total Cash Flows from Non-Capital Financing Activities (1,999,142) - 6,235 (3,262,176)

Cash Flows from Investing Activities Interest on Investments 545 - - 295,854 Purchase of Investments - - - ( 1,238,046) Interfund Loans - - - 2,000,000 Total Cash Flows from Investing Activities 545 - - 1,057,808

Net Increase (Decrease) in Cash and Cash Equivalents 1,004,884 280,710 (663) 7,314,388 Cash and Cash Equivalents, January 1, 2017 2,555,697 144,801 614,789 25,901,682 Cash and Cash Equivalents, December 31, 2017 $ 3,560,581 $ 425,511 $ 614,126 $ 33,216,070

Reconciliation of Operating Income to Net Cash Provided (Used) by Operating Activities Net Operating Income (loss) $ 1,760,339 $ 151,098 $ (45,911) $ (1,933,769) Depreciation Expense 64,354 2,104 10,431 4,022,851 Changes in Receivables, Net (5,593) - (356) 1,348,926 Changes in Inventories - - - (71,818) Changes in Accounts Payable & Other Liabilities 1,316,155 127,508 28,938 13,164,490 Net Cash Provided (Used) by Operating Activities $ 3,135,255 $ 280,710 $ (6,898) $ 16,530,680

Non-Cash Investing, Capital and Related Financing Activities Contributions of Capital Assets $ - $ - $ - $ 676,053

128 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Statement of Net Position Component Units December 31, 2017

Component Units Snohomish Pilchuck County Public Development Facilities District Corporation Total

ASSETS Cash and Equivalents, Restricted $ 856,148 $ 114,698 $ 970,846 Total Current Assets 856,148 114,698 970,846

Total Assets 856,148 114,698 970,846

LIABILITIES Current Liabilities Accounts Payable 1,303 - 1,303 Total Current Liabilities 1,303 - 1,303

Total Liabilities 1,303 - 1,303

NET POSITION Restricted for: Economic Environment 854,845 - 854,845 Culture and Recreation - 114,698 114,698 Total Restricted Net Position 854,845 114,698 969,543

Total Net Position $ 854,845 $ 114,698 $ 969,543

The notes to the financial statements are an integral part of this statement. 129 130 SNOHOMISH COUNTY COMBINING STATEMENT OF ACTIVITIES-COMPONENT UNITS For Fiscal Year Ended December 31, 2017

Program Revenues Net (Expenses) Revenues and Changes in Net Position Component Units Snohomish Indirect Operating Capital Grants County Public Pilchuck Expense Charges for Grants and and Facilities Development Functions/Programs Expenses Allocation Services Contributions Contributions District Corporation Total Component units: Snohomish County PFD $ 2,626,684 $ - $ - $ - $ - $ (2,626,684) $ - $ (2,626,684) Pilchuck Development Corporation ------Total component units $ 2,626,684 $ - $ - $ - $ - $ (2,626,684) $ - $ (2,626,684)

General revenues: Sales/Use Tax 2,780,955 - 2,780,955 Interest and Investment Earnings 4,355 - 4,355 Total General Revenues 2,785,310 - 2,785,310 Change in net position 158,626 - 158,626 Net position - Beginning 696,219 114,698 810,917 Net position - Ending $ 854,845 $ 114,698 $ 969,543 The notes to the financial statements are an integral part of this statement. statements are an integral The notes to the financial Fiduciary Funds December 31, 2017

Fiduciary Funds

Fiduciary Funds are clearing accounts employed to account for assets held by Snohomish County in its capacity as custodian or agent and are offset by equal and related liabilities. There is no measurement of operational results. There are two major classifications of Agency Funds: (1) those that are used for the operations of Snohomish County government; and (2) those that are used to account for cash received and disbursed in Snohomish County’s capacity as ex officio treasurer or collection agent for special districts and other governments.

Fiduciary Funds include all Trust and Agency Funds which account for assets held by the County as a trustee or as an agent for individuals or other governmental units.

Tax Collection Fund - Accounts for monies received for current and delinquent taxes which are held pending authority for distribution. Included are prepaid taxes, disputed taxes, duplicate taxes, duplicate payment of taxes, etc.

Cities and Towns – Each city and town has its own set of funds established within the accounting system of Snohomish County that the Snohomish County Treasurer utilizes to account for the collection and remittance of regular, special, and bond property tax levies to their respective treasurers.

Fire Districts - Each fire district has its own set of funds established within the accounting system of Snohomish County that the Snohomish County Treasurer utilizes to account for cash received and disbursed in Snohomish County’s capacity as ex officio treasurer or collection agent.

Hospitals - Snohomish County has 3 public hospital districts. The Snohomish County Treasurer utilizes a group of funds to account for the collection and remittance of regular, special, and bond property tax levies to their respective treasurers. For one hospital the Snohomish County Treasurer utilizes a group of funds within Snohomish County to account for cash received and disbursed in Snohomish County’s capacity as ex officio treasurer or collection agent.

Libraries - These funds were established for the purpose of financing the acquisition, improvement, and construction of various libraries. The Snohomish County Treasurer utilizes a group of funds to account for the collection and remittance of regular, special, and bond property tax levies to their respective treasurers.

Special Purpose Districts - Two categories fall under “Special Purpose Districts”: Sewer & Water and Drainage. • Sewer & Water Districts - The Snohomish County Treasurer utilizes a group of funds for various sewer and water districts within Snohomish County to account for cash received and disbursed in Snohomish County’s capacity as ex officio treasurer or collection agent. • Drainage Districts - The Snohomish County Treasurer utilizes a group of funds for various drainage districts within Snohomish County to account for cash received and disbursed in Snohomish County’s capacity as ex officio treasurer or collection agent.

131 Fiduciary Funds December 31, 2017

Ports – Each port has its own set of funds established within the accounting system of Snohomish County that the Snohomish County Treasurer utilizes for various port districts to account for the collection and remittance of regular, special, and bond property tax levies to their respective treasurers.

School Districts – Each school district has its own set of funds established within the accounting system of Snohomish County that the Snohomish County Treasurer utilizes to account for the collection and remittance of regular, special, and bond property tax levies to their respective treasurers.

State Revenue Collection Funds – Accounts for various fees, fines, and penalties collected by county departments for the State of Washington.

Other Agency Funds – Accounts for monies held as agent for a variety of purposes including the Public Health District, benefits, and various clearing funds.

The Investment Trust Fund is the external portion of the Snohomish County Investment Pool (SCIP) that belongs to outside districts. There are no involuntary participants in the SCIP. All participants have notified the Treasurer of their desire to participate in SCIP. SCIP investments are those allowed by County Investment Policy and include savings accounts, CD’s and securities.

132 Snohomish County, WA Combining Statement of Changes in Assets and Liabilities Fiduciary Funds For the Year Ended December 31, 2017

Total Agency Funds 1/1/2017 Increases Decreases 12/31/2017 ASSETS

Current Assets Deposits and Investments with County Treasurer $ 647,402,570 $ 5,572,787,077 $ 5,553,974,791 $ 666,214,856 Taxes Receivable 24,099,308 1,022,782,294 1,023,532,194 23,349,408 Other Receivables, Net 1,821,124 38,290,625 37,875,704 2,236,045 Interest Receivable 96,888 71,281 77,814 90,355 Total Assets $ 673,419,890 $ 6,633,931,277 $ 6,615,460,503 $ 691,890,664

LIABILITIES

Current Liabilities Due to Other Governments $ 673,419,890 $ 5,612,858,359 $ 5,594,387,585 $ 691,890,664

Total Liabilities $ 673,419,890 $ 5,612,858,359 $ 5,594,387,585 $ 691,890,664

The notes to the financial statements are an integral part of this statement. 133 Snohomish County, WA Combining Statement of Changes in Assets and Liabilities Fiduciary Funds For the Year Ended December 31, 2017

Tax Collection Fund 1/1/2017 Increases Decreases 12/31/2017 ASSETS

Current Assets Deposits and Investments with County Treasurer $ 1,275,934 $ 10,024,344 $ 10,884,793 $ 415,485 Taxes Receivable 226 - 93 133 Total Assets $ 1,276,160 $ 10,024,344 $ 10,884,886 $ 415,618

LIABILITIES

Current Liabilities Due to Other Governments $ 1,276,160 $ 10,092,555 $ 10,953,097 $ 415,618

Total Liabilities $ 1,276,160 $ 10,092,555 $ 10,953,097 $ 415,618

Cities/Towns 1/1/2017 Increases Decreases 12/31/2017 ASSETS

Current Assets Deposits and Investments with County Treasurer $ 2,870,619 $ 176,342,688 $ 176,606,026 $ 2,607,281 Taxes Receivable 3,133,149 134,359,328 134,516,457 2,976,020 Other Receivables, Net 140,163 9,334,626 9,271,391 203,398 Total Assets $ 6,143,931 $ 320,036,642 $ 320,393,874 $ 5,786,699

LIABILITIES

Current Liabilities Due to Other Governments $ 6,143,931 $ 302,118,183 $ 302,475,415 $ 5,786,699

Total Liabilities $ 6,143,931 $ 302,118,183 $ 302,475,415 $ 5,786,699

Fire Districts 1/1/2017 Increases Decreases 12/31/2017 ASSETS

Current Assets Deposits and Investments with County Treasurer $ 71,036,895 $ 391,711,043 $ 418,172,010 $ 44,575,928 Taxes Receivable 2,381,802 94,580,834 94,659,183 2,303,453 Total Assets $ 73,418,697 $ 486,291,877 $ 512,831,193 $ 46,879,381

LIABILITIES

Current Liabilities Due to Other Governments $ 73,418,697 $ 300,326,694 $ 326,866,010 $ 46,879,381

Total Liabilities $ 73,418,697 $ 300,326,694 $ 326,866,010 $ 46,879,381

134 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Statement of Changes in Assets and Liabilities Fiduciary Funds For the Year Ended December 31, 2017

Hospitals 1/1/2017 Increases Decreases 12/31/2017 ASSETS

Current Assets Deposits and Investments with County Treasurer $ 1,962,393 $ 38,266,353 $ 37,850,326 $ 2,378,420 Taxes Receivable 373,865 10,493,988 10,540,279 327,574 Total Assets $ 2,336,258 $ 48,760,341 $ 48,390,605 $ 2,705,994

LIABILITIES

Current Liabilities Due to Other Governments $ 2,336,258 $ 36,514,659 $ 36,144,923 $ 2,705,994

Total Liabilities $ 2,336,258 $ 36,514,659 $ 36,144,923 $ 2,705,994

Library 1/1/2017 Increases Decreases 12/31/2017 ASSETS

Current Assets Deposits and Investments with County Treasurer $ 34,085,281 $ 49,975,867 $ 51,730,583 $ 32,330,565 Taxes Receivable 964,339 38,623,746 38,673,811 914,274 Total Assets $ 35,049,620 $ 88,599,613 $ 90,404,394 $ 33,244,839

LIABILITIES

Current Liabilities Due to Other Governments $ 35,049,620 $ 87,914,047 $ 89,718,828 $ 33,244,839

Total Liabilities $ 35,049,620 $ 87,914,047 $ 89,718,828 $ 33,244,839

Special Purpose District 1/1/2017 Increases Decreases 12/31/2017 ASSETS

Current Assets Deposits and Investments with County Treasurer $ 17,682,836 $ 42,901,537 $ 42,755,105 $ 17,829,268 Other Receivables, Net 971,654 1,943,439 1,866,768 1,048,325 Interest Receivable 94,596 61,778 69,380 86,994 Total Assets $ 18,749,086 $ 44,906,754 $ 44,691,253 $ 18,964,587

LIABILITIES

Current Liabilities Due to Other Governments $ 18,749,086 $ 25,081,879 $ 24,866,378 $ 18,964,587

Total Liabilities $ 18,749,086 $ 25,081,879 $ 24,866,378 $ 18,964,587

The notes to the financial statements are an integral part of this statement. 135 Snohomish County, WA Combining Statement of Changes in Assets and Liabilities Fiduciary Funds For the Year Ended December 31, 2017

Ports 1/1/2017 Increases Decreases 12/31/2017 ASSETS

Current Assets Deposits and Investments with County Treasurer $ 39,748 $ 5,255,128 $ 5,253,241 $ 41,635 Taxes Receivable 131,493 5,174,127 5,201,069 104,551 Total Assets $ 171,241 $ 10,429,255 $ 10,454,310 $ 146,186

LIABILITIES

Current Liabilities Due to Other Governments $ 171,241 $ 10,429,255 $ 10,454,310 $ 146,186

Total Liabilities $ 171,241 $ 10,429,255 $ 10,454,310 $ 146,186

Schools 1/1/2017 Increases Decreases 12/31/2017 ASSETS

Current Assets Deposits and Investments with County Treasurer $ 485,441,426 $ 3,644,670,335 $ 3,600,139,802 $ 529,971,959 Taxes Receivable 11,816,570 509,019,754 509,325,020 11,511,304 Total Assets $ 497,257,996 $ 4,153,690,089 $ 4,109,464,822 $ 541,483,263

LIABILITIES

Current Liabilities Due to Other Governments $ 497,257,996 $ 3,446,800,230 $ 3,402,574,963 $ 541,483,263

Total Liabilities $ 497,257,996 $ 3,446,800,230 $ 3,402,574,963 $ 541,483,263

State Revenue Collection 1/1/2017 Increases Decreases 12/31/2017 ASSETS

Current Assets Deposits and Investments with County Treasurer $ 2,847,408 $ 363,552,535 $ 363,541,357 $ 2,858,586 Taxes Receivable 5,296,138 213,741,475 214,046,051 4,991,562 Other Receivables, Net 670,746 25,879,275 25,602,200 947,821 Total Assets $ 8,814,292 $ 603,173,285 $ 603,189,608 $ 8,797,969

LIABILITIES

Current Liabilities Due to Other Governments $ 8,814,292 $ 582,975,875 $ 582,992,198 $ 8,797,969

Total Liabilities $ 8,814,292 $ 582,975,875 $ 582,992,198 $ 8,797,969

136 The notes to the financial statements are an integral part of this statement. Snohomish County, WA Combining Statement of Changes in Assets and Liabilities Fiduciary Funds For the Year Ended December 31, 2017

Other 1/1/2017 Increases Decreases 12/31/2017 ASSETS

Current Assets Deposits and Investments with County Treasurer $ 30,160,030 $ 850,087,247 $ 847,041,548 $ 33,205,729 Taxes Receivable 1,726 16,789,042 16,570,231 220,537 Other Receivables, Net 38,561 1,133,285 1,135,345 36,501 Interest Receivable 2,292 9,503 8,434 3,361 Total Assets $ 30,202,609 $ 868,019,077 $ 864,755,558 $ 33,466,128

LIABILITIES

Current Liabilities Due to Other Governments $ 30,202,609 $ 810,604,982 $ 807,341,463 $ 33,466,128

Total Liabilities $ 30,202,609 $ 810,604,982 $ 807,341,463 $ 33,466,128

The notes to the financial statements are an integral part of this statement. 137

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Snohomish County, Washington

Statistical Section

2017 Statistical Section

This part of Snohomish County's comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the County's overall financial health.

Contents Page

Financial Trends 139 These schedules contain trend information to help the reader understand how the County's financial performance and well-being have changed over time.

Revenue Capacity 144 These schedules contain information to help the reader assess the County's most significant local revenue source, property taxes.

Debt Capacity 148 These schedules present information to help the reader assess the affordability of the County's current levels of outstanding debt and the County's ability to issue additional debt in

Demographic and Economic Information 152 These schedules offer demographic and economic indicators to help the reader understand the environment within which the County's financial activities take place.

Operating Information 155 These schedules contain service and infrastructure data to help the reader understand how the information in the County's financial report relates to the services the County provides and the activities it performs.

138 139

2017 Statistical Section Snohomish County Net Position by Component Last Ten Years (accrual basis of accounting)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Governmental activities Net Investment in Capital Assets $ 604,555,852 $ 639,623,482 $ 684,331,825 $ 716,330,913 $ 746,925,944 $ 829,507,434 $ 885,863,850 $ 984,654, 696 $ 1,041,598,717 $ 1,067,965,229 Restricted 134,862,410 104,376,948 93,786,886 94,461,981 110,972,156 237,660, 221 222,088, 115 204,914, 351 196,953,635 205,054,504 Unrestricted 61,395,892 51,843,583 51,810,124 32,365,308 36,481,602 (87,645,531) (82,972,204) (182,650,382) (159,381,693) (134,791,637) Total governmental activities net position $ 800,814,154 $ 795,844,013 $ 829,928,835 $ 843,158,202 $ 894,379,702 $ 979,522,124 $ 1,024,979,761 $ 1,006, 918,665 $ 1,079,170,659 $ 1,138,228,096

Business-type activities Net Investment in Capital Assets 129,008,078 142,317,402 148,844,543 152,494,980 166,476,140 180,545, 578 182,709, 274 193,758, 402 210,544,046 219,759,682 Restricted 8,227,534 1,600,719 1,905,165 563,490 29,551,183 1,568,590 1, 311,850 1,216, 990 919,723 979,572 Unrestricted (2,010,239) 11,975,688 18,984,301 22,425,523 (3,515,662) 27, 636,663 42, 264,613 31, 175,187 33,714,655 41,519,062 Total business-type activities net position $ 135,225,373 $ 155,893,809 $ 169,734,009 $ 175,483,993 $ 192,511,661 $ 209,750,831 $ 226,285,737 $ 226,150, 579 $ 245,178,424 $ 262,258,316

Primary government Net Investment in Capital Assets 733,563,930 781,940,884 833,176,368 868,825,893 913,402,084 1,010, 053,012 1, 068,573,124 1,178,413, 098 1,252,142,763 1,287,724,911 Restricted 143,089,944 105,977,667 95,692,051 95,025,471 140,523,339 239,228, 811 223,399, 965 206,131, 341 197,873,358 206,034,076 Unrestricted 59,385,653 63,819,271 70,794,425 54,790,831 32,965,940 (60,008,868) (40,707,591) (151,475,195) (125,667,038) (93,272,575) Total primary government net position $ 936,039,527 $ 951,737,822 $ 999,662,844 $ 1,018,642,195 $ 1,086,891,363 $ 1,189,272,955 $ 1,251,265,498 $ 1,233,069,244 $ 1,324,349,083 $ 1,400,486,412

Source: Comprehensive annual financial reports for the relevant year.

a In 2011 data was restated to reflect prior period adjustments and a change in accounting principal related to GASB 51. 2017 Statistical Section Snohomish County Fund Balances of Governmental Funds Last Ten Years (modified accrual basis of accounting)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

General fund Committed $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 200,000 Assigned 511,090 - 1,156,576 2,237,649 2,998,933 2,657,410 3,582,519 5,049,818 957,146 2,915,514 Unassigned 12,260,949 7,709,583 21,556,459 17,675,227 16,553,407 18,517,464 11,726,187 15,114,512 28,329,819 29,838,013 Total general fund $ 12,772,039 $ 7,709,583 $ 22,713,035 $ 19,912,876 $ 19,552,340 $ 21,174,874 $ 15,308,706 $ 20,164,330 $ 29,286,965 $ 32,953,527

All Other Governmental Funds Restricted $ 132,089,659 $ 101,824,305 $ 94,228,872 $ 90,936,859 $ 105,274,090 $ 228,521,704 $ 211,715,398 $ 195,367,707 $ 188,339,770 $ 197,303,069 Committed 27,918,304 21,271,953 17,086,755 17,730,755 17,603,359 16,958,294 19,760,301 21,319,060 24,842,183 36,748,272 Unassigned ------(421,771) (935,482) - Total all other governmental funds $ 160,007,963 $ 123,096,258 $ 111,315,627 $ 108,667,614 $ 122,877,449 $ 245,479,998 $ 231,475,699 $ 216,264,996 $ 212,246,471 $ 234,051,341

Source: Comprehensive annual financial reports for the relevant year.

a Information prior to 2011 has been restated to reflect prior period adjustments and a change in accounting principal related to GASB 54. 140 141

2017 Statistical Section Snohomish County Changes in Net Position Last Ten Years (accrual basis of accounting) 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Expenses Governmental Activities General Government $ 67,588,396 $ 81,702,382 $ 54,484,390 $ 51,672,661 $ 46,449,546 $ 55,307,790 $ 64,632,409 $ 60,174,691 $ 74,037,072 $ 74, 203,806 Judicial 39,430,601 38,474,210 37,338,986 32,181,326 40,250,440 34,443,731 35,749,154 33,355,914 35,192,199 33, 233,405 Public Safety 125,100,023 121,572,056 120,095,604 121,254,086 123,396,116 133,675,678 150,837,794 134,382,336 138,272,437 139, 604,215 Physical Environment 2,768,527 4,461,900 2,460,541 1,234,475 680,773 852,604 8,133,255 7,063,050 2,670,120 2,453, 544 Transportation 74,522,179 83,624,754 81,830,429 94,433,357 75,851,260 73,688,939 80,326,747 85,263,047 92,094,703 109, 921,614 Health and Human Services 46,821,175 50,651,586 51,769,839 51,557,316 47,740,267 61,530,041 61,790,410 66,919,863 71,597,708 69, 877,361 Economic Environment 33,973,786 28,883,648 26,222,092 27,194,328 29,169,379 16,825,115 22,931,238 24,080,559 23,730,709 28, 428,899 Culture and Recreation 14,276,131 16,276,478 17,917,188 13,437,749 16,413,182 17,528,679 18,137,794 17,688,852 19,516,842 20, 022,978 Interest on Long-Term Debt 13,941,283 13,280,208 11,111,141 12,919,605 10,905,994 17,025,812 13,763,202 14,832,095 12,481,051 11, 677,761 Total Government Activities 418,422,101 438,927,222 403,230,210 405,884,903 390,856,957 410,878,389 456,302,003 443,760,407 469,592,841 489, 423,583 Business-type Activities Airport 15,460,097 15,997,993 16,856,421 18,135,767 19,397,201 22,983,754 21,962,701 22,329,080 22,881,792 23, 069,603 Solid Waste Management 50,857,104 47,604,194 45,142,954 44,465,301 44,788,079 47,686,132 59,761,747 51,534,582 54,099,470 58, 157,108 Surface Water Management 12,264,324 13,279,078 14,077,242 17,693,416 16,144,281 17,811,418 19,250,027 17,598,870 21,379,571 21, 541,963 Total Business-type Activities 78,581,525 76,881,265 76,076,617 80,294,484 80,329,561 88,481,304 100,974,475 91,462,532 98,360,833 102, 768,674 Total Primary Government Expenses $ 497,003,626 $ 515,808,487 $ 479,306,827 $ 486,179,387 $ 471,186,518 $ 499,359,693 $ 557,276,478 $ 535,222,939 $ 567,953,674 $ 592, 192,257

Program Revenues Governmental Activities Charges for Services General Government $ 19,536,986 $ 18,455,742 $ 15,042,153 $ 15,181,617 $ 15,389,469 $ 18,465,050 $ 22,872,614 $ 22,624,025 $ 25,544,434 $ 27, 790,877 Judicial 11,537,796 13,920,256 12,092,336 4,173,431 12,873,616 12,466,821 11,326,801 9,651,376 8,216,568 8, 587,202 Public Safety 13,195,198 18,514,799 19,250,441 19,623,708 19,711,283 32,420,362 24,972,248 26,251,403 28,910,075 30, 286,650 Physical Environment 70,840 41,719 - - 103 - 15,108 - 15,627 31,349 Transportation 393,808 1,174,348 9,307,917 4,773,051 3,089,631 7,527,054 5,236,980 6,331,024 7,131,595 7, 489,275 Health and Human Services 60,200 56,543 60,150 71,225 148,202 13,899,737 15,597,943 17,653,391 19,339,499 19, 205,823 Economic Environment 20,992,301 14,023,556 16,841,097 17,940,688 21,134,146 7,687,473 12,079,317 13,328,507 13,415,862 12, 361,546 Culture and Recreation 1,809,589 1,606,490 5,294,316 5,782,595 6,390,667 8,540,673 9,060,496 9,043,896 9,667,637 10, 051,790 Operating Grants and Contributions 74,997,807 86,759,777 88,042,812 96,109,008 91,334,657 62,275,495 71,660,169 66,622,683 67,951,238 66, 619,250 Capital Grants and Contributions 71,807,507 69,699,343 62,616,781 36,980,415 31,804,474 94,449,750 84,714,098 112,323,036 90,906,060 83, 023,425 Total Governmental Activities Program Revenues 214,402,032 224,252,573 228,548,003 200,635,738 201,876,248 257,732,415 257,535,774 283,829,341 271,098,595 265, 447,187

Business-type Activities Charges for Services Airport 12,987,243 13,003,047 13,577,826 15,990,702 18,320,562 23,357,110 23,022,355 23,528,011 25,135,724 26, 024,726 Solid Waste Management 44,159,129 45,422,866 45,099,346 45,034,438 45,764,790 48,949,729 60,211,208 55,477,718 56,293,984 59, 900,817 Surface Water Management 9,444,777 17,738,611 17,748,134 17,579,274 17,830,313 16,318,212 17,703,387 18,094,746 18,129,797 21, 835,684 Operating Grants and Contributions 2,554,072 2,157,385 2,130,175 2,494,917 1,250,914 2,247,978 8,600,020 2,896,544 2,282,226 1, 706,230 Capital Grants and Contributions 4,832,482 16,933,091 9,267,676 3,554,186 13,273,150 11,619,988 4,655,515 5,690,374 14,335,757 8, 384,461 Total Business-type Activities Program Revenues 73,977,703 95,255,000 87,823,157 84,653,517 96,439,729 102,493,017 114,192,485 105,687,393 116,177,488 117, 851,918 Total Primary Government Program Revenues $ 288,379,735 $ 319,507,573 $ 316,371,160 $ 285,289,255 $ 298,315,977 $ 360,225,432 $ 371,728,259 $ 389,516,734 $ 387,276,083 $ 383, 299,105

Net (Expense) Revenue Governmental Activities $ (204,020,069) $ (214,674,649) $ (174,682,207) $ (205,249,165) $ (188,980,709) $ (153,145,974) $ (198,766,229) $ (159,931,066) $ (198,494,246) $ (223,976,396) Business-type Activities (4,603,822) 18,373,735 11,746,540 4,359,033 16,110,168 14,011,713 13,218,010 14,224,861 17,816,655 15, 083,244 Total Primary Government Net Expense $ (208,623,891) $ (196,300,914) $ (162,935,667) $ (200,890,132) $ (172,870,541) $ (139,134,261) $ (185,548,219) $ (145,706,205) $ (180,677,591) $ (208,893,152) 2017 Statistical Section Snohomish County Changes in Net Position Last Ten Years (accrual basis of accounting) 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

General Revenues and Other Changes in Net Position Governmental Activities Property taxes $ 121,356,387 $ 123,711,451 $ 121,697,814 $ 126,372,999 $ 128,735,600 $ 133,188,342 $ 141,207,602 $ 146,916,702 $ 150,138,657 $ 154,769, 362 Sales/Use Tax 41,190,681 45,463,263 49,000,016 47,247,127 51,972,125 57,110,374 60,863,484 64,743,714 69,981,061 74,794, 126 Real Estate Excise Tax 10,626,703 8,384,090 8,168,205 7,351,824 9,843,014 11,959,344 13,112,059 16,803,903 21,382,632 22,915, 311 Business and Other Taxes 9,383,294 9,596,364 9,988,131 13,097,688 14,172,048 14,830,188 14,829,349 14,771,779 14,946,561 15,640, 297 Intergovernmental Revenues 15,272,055 5,673,859 7,261,041 13,973,089 26,031,281 14,051,907 8,043,279 15,827,782 5,643,518 5,654, 949 Interest and Investment Earnings 20,537,004 16,197,768 12,956,602 11,318,962 9,851,193 8,444,502 8,441,024 7,521,772 8,740,027 10,404, 089 Miscellaneous Revenues 4,057,658 2,111,909 1,209,103 115,844 117,457 189,050 96,671 105,284 717,597 86, 869 Transfers (3,731,261) (1,434,196) (1,513,883) (999,001) (520,509) (1,485,311) (2,893,972) (1,105,284) (803,813) (1,231,170) Total Governmental Activities 218,692,521 209,704,508 208,767,029 218,478,532 240,202,209 238,288,396 243,699,496 265,585,652 270,746,240 283,033, 833 Business-type Activities Interest and Investment Earnings 1,621,850 745,509 494,345 365,877 343,985 296,818 227,990 206,126 393,525 765, 478 Miscellaneous Revenues 665,172 114,996 85,432 26,073 53,006 1,445,328 194,934 28,173 13,852 - Transfers 3,731,261 1,434,196 1,513,883 999,001 520,509 1,485,311 2,893,972 1,105,284 803,813 1,231,170 Total Business-type Activities 6,018,283 2,294,701 2,093,660 1,390,951 917,500 3,227,457 3,316,896 1,339,583 1,211,190 1,996, 648 Total Primary Government $ 224,710,804 $ 211,999,209 $ 210,860,689 $ 219,869,483 $ 241,119,709 $ 241,515,853 $ 247,016,392 $ 266,925,235 $ 271,957,430 $ 285,030, 481

Change in Net Position Governmental Activities $ 14,672,452 $ (4,970,141) $ 34,084,822 $ 13,229,367 $ 51,221,500 $ 85,142,422 $ 44,933,267 $ 105,654,586 $ 72,251,994 $ 59,057, 437 Business-type Activities 1,414,461 20,668,436 13,840,200 5,749,984 17,027,668 17,239,170 16,534,906 15,564,444 19,027,845 17,079, 892 Total Primary Government Change in Net Postiion $ 16,086,913 $ 15,698,295 $ 47,925,022 $ 18,979,351 $ 68,249,168 $ 102,381,592 $ 61,468,173 $ 121,219,030 $ 91,279,839 $ 76,137,329

Source: Comprehensive annual financial reports for the relevant year. 142 143

2017 Statistical Section Snohomish County Changes in Fund Balances of Governmental Funds Last Ten Years (modified accrual basis of accounting) 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Revenues Property Taxes $ 120,894,481 $ 122,594,636 $ 122,520,226 $ 126,442,425 $ 129,407,825 $ 135,231,939 $ 142,933,681 $ 146,857,181 $ 150,208,403 $ 153,385,617 Sales/Use Taxes 41,190,681 45,463,263 49,000,016 47,247,128 51,972,124 57,110,374 60,863,484 64,743,714 69,981,061 74,794,126 Real Estate Excise Taxes 10,626,703 8,384,090 8,168,204 7,351,824 9,843,013 11,959,344 13,112,059 16,702,634 21,361,937 22,867, 324 Business and Other Taxes 9,383,294 9,596,364 9,988,130 13,097,687 14,172,047 14,830,187 15,907,896 15,892, 529 16,081,384 16,764,868 Licenses & Permits 3,585,338 3,858,410 3,760,970 3,778,360 3,974,418 4,060,373 4,117,809 4,263,232 4,431,732 4,566, 778 Charges for Services 61,848,018 59,940,816 60,689,286 61,386,568 64,355,653 90,763,070 91,498,894 96,429,213 105,042,130 107,733,307 Operating Assessments 21,104 20,991 21,400 20,373 20,750 64,504 26,632 34,088 33,385 25,225 Intergovernmental Revenues 127,777,613 126,390,353 132,166,817 123,541,472 125,671,395 101,528,065 99,740,089 97,049,042 92,466,172 93,515,058 Fines & Forfeitures 5,650,132 6,599,995 6,409,207 7,051,501 7,271,691 7,443,085 6,894,767 6,264,089 5,696,260 5,215, 991 Interest & Investment Earnings 17,733,158 12,795,719 13,274,763 10,717,000 11,039,417 11,291,200 9,169,618 8,229,953 8,565,224 10,746,427 Rents, Leases & Concessions 7,682,590 7,710,788 8,224,196 8,588,469 9,065,614 9,937,779 10,427,972 10,461,932 9,361,107 9,854, 908 Contributions & Donations 604,325 1,293,518 2,017,393 553,178 688,827 951,692 1,029, 264 1,727,666 2,161,865 1,503, 199 Miscellaneous Revenues 3,203,137 1,649,099 1,779,996 1,740,301 1,833,682 1,644,186 2,785,170 1,851,397 1,524,603 1,531, 825 Total Revenues 410,200,574 406,298,042 418,020,604 411,516,286 429,316,456 446,815,798 458,507,335 470,506,670 486,915,263 502,504,653 Expenditures General Government 69,856,878 63,822,426 59,666,669 57,800,996 59,829,213 67,639,596 70,162,466 70,641,427 74,649,272 77,687,800 Judicial 34,216,044 32,504,840 32,617,282 34,355,936 35,079,179 30,214,028 36,890,099 35,637,706 33,216,513 32,576,988 Public Safety 121,337,781 117,659,090 119,441,130 122,257,186 122,888,204 133,278,170 149,636,149 137,718,642 139,424,388 143,877,573 Physical Environment 5,332,845 5,364,242 6,176,573 4,219,658 893,556 1,140,806 12,754,463 8,501,160 8,284,169 1,803, 417 Transportation 107,970,358 107,912,400 93,730,324 73,223,519 71,345,822 78,340,666 77,553,011 80,488,136 80,485,380 60,653,116 Health and Human Services 46,947,178 50,686,303 51,747,909 51,571,684 47,704,031 61,515,058 61,760,504 67,986,343 71,698,162 71,155,980 Economic Environment 34,785,517 31,770,855 27,708,173 27,642,043 30,107,941 17,506,618 23,800,458 25,310,924 25,244,340 27,758,693 Culture & Recreation 26,978,350 18,450,292 19,496,564 22,662,956 29,491,477 19,222,003 16,726,432 27,293,258 25,683,544 15,743,137 Debt Service Principal Payments 12,740,775 12,587,001 9,136,460 11,293,212 13,704,300 14,505,654 15,698,335 14,963, 076 13,070,018 13,487,412 Interest and Other Charges 13,883,488 13,008,713 12,039,223 13,898,938 10,858,350 14,340,957 14,252,155 13,834,950 12,876,434 12,372,089 Capital Outlay ------35,594,356 Total Expenditures 474,049,214 453,766,162 431,760,307 418,926,128 421,902,073 437,703,556 479,234,072 482,375,622 484,632,220 492,710,561

Excess (deficiency) of revenues over (under) expenditures (63,848,640) (47,468,120) (13,739,703) (7,409,842) 7,414,383 9,112,242 (20,726,737) (11,868,952) 2,283,043 9,794,092

Other Financial Sources (Uses) Disposition Of Capital Assets 348,427 208,841 9,043 34,764 11,616 15,195 88,884 379,235 1, 031,202 13,801, 969 Transfers In 54,634,304 51,606,865 50,244,470 46,965,821 63,570,580 49,463,243 51,063,113 59,899,764 46,179,282 51,462,717 Transfers Out (57,742,061) (51,093,057) (51,348,966) (47,125,870) (63,154,158) (50,236,902) (50,820,097) (58,503,760) (44,389,417) (49,587,346) Debt Proceeds 5,450,167 4,645,869 15,710,000 - 5,420,000 107,885,000 - - - - Payment to Refunded Bond Escrow Agent - - (116,337,699) (39,269,112) 3,655,000 - - - - - Issuance of Refunding Bonds 23,420,555 3,375,199 112,035,693 75,045,000 - - - 33,827,120 - - Refunded Bonds Redeemed (23,387,655) (3,450,167) - (35,056,555) (4,061,064) - - (38,359,662) - - Issuance Premium on LT Deb - 208,090 6,649,982 1,367,622 992,942 7,986,305 - 4,271, 176 - - Issuance Discount on LT Debt - (7,681) ------Total Other Financial Sources (Uses) 2,723,737 5,493,959 16,962,523 1,961,670 6,434,916 115,112,841 331,900 1,513,873 2,821,067 15,677,340

Net Change in Fund Balances $ (61,124,903) $ (41,974,161) $ 3,222,820 $ (5,448,172) $ 13,849,299 $ 124,225,083 $ ( 20,394,837) $ ( 10,355,079) $ 5,104,110 $ 25,471,432

Debt service as a percentage of noncapital expenditures 6.6% 6.6% 5.7% 6.6% 6.4% 7.2% 6.8% 6.6% 5.8% 5.5%

Source: Comprehensive annual financial reports for the relevant

a Data Prior to 2010 has been restated to reflect prior period adjustments. b In 2008, Other Taxes were broken out into Real Estate Excise Taxes and Business Taxes. Figures for 2007 have been restated to reflect reporting change. c In 2017, it was the initial year Snohomish County broke out Capital Outlay from functional expense. 2017 Statistical Section Snohomish County Assessed Value and Estimated Actual Value of Taxable Property Last Ten Years Total Estimated Assessed Year Real Real Total Taxable Direct Actual Value as a Ended Property Property Personal Assessed Tax Taxable Percentage of December 31 Land Improvements Property Utilities Value Rate Valuea Actual Valuea 2008 $ 49,484,124,767 $ 46,009,302,813 $ 2,855,497,781 $ 966,277,844 $ 99,315,203,205 1.82 $ 99,315,203,205 100.00% 2009 51,141,268,856 46,523,193,048 3,312,361,415 1,006,611,127 101,983,434,446 1.84 101,983,434,446 100.00% 2010 44,758,440,882 45,147,310,861 3,220,877,993 998,582,942 94,125,212,678 2.04 94,125,212,678 100.00% 2011 38,972,159,106 42,536,523,561 3,158,003,802 1,043,921,095 85,710,607,564 2.36 85,710,607,564 100.00% 2012 31,332,085,791 41,119,170,675 3,014,074,811 1,181,706,315 76,647,037,592 2.69 76,647,037,592 100.00% 2013 28,957,298,071 39,601,313,925 2,967,900,349 1,095,110,175 72,621,622,520 2.95 72,621,622,520 100.00% 2014 32,516,600,699 42,661,819,476 3,155,360,542 1,114,961,690 79,448,742,407 2.81 79,448,742,407 100.00% 2015 35,090,680,232 48,766,503,381 3,269,205,311 1,133,818,713 88,260,207,637 2.61 88,260,207,637 100.00% 2016 38,292,520,673 53,214,157,287 3,475,535,115 1,097,879,840 96,080,092,915 2.45 96,080,092,915 100.00% 2017 44,037,719,575 56,387,299,698 3,626,117,752 984,949,899 105,036,086,924 2.30 105,036,086,924 100.00%

Source: Snohomish County Assessors Office

a Property in Snohomish County is reassessed each year. Therefore, the assessed values are equal to actual value. Tax rates are per $1,000 of assessed value. 144 145

2017 Statistical Section Snohomish County Direct and Overlapping Property Tax Rates Last Ten Years (rate per $1,000 of assessed value)

County Direct Overlapping Ratesa Conservation Total County Washington Cities and Fire School Other Year Regular Futures Road Rate State Towns Districts Districts Districts 2008 0.69 0.03 1.10 1.82 1.91 1.54 1.30 3.37 0.23 2009 0.68 0.03 1.13 1.84 1.91 1.54 1.28 3.46 0.22 2010 0.74 0.04 1.26 2.04 1.99 1.70 1.38 3.94 0.42 2011 0.83 0.04 1.49 2.36 2.21 1.96 1.64 4.49 0.30 2012 0.93 0.04 1.72 2.69 2.38 2.17 1.76 5.08 0.32 2013 1.03 0.05 1.87 2.95 2.43 2.27 1.92 5.47 0.34 2014 1.03 0.04 1.74 2.81 2.38 2.17 1.88 5.08 0.35 2015 0.96 0.04 1.61 2.61 2.28 2.09 1.82 5.11 0.32 2016 0.89 0.04 1.52 2.45 2.12 2.00 1.75 4.79 0.30 2017 0.84 0.04 1.42 2.30 2.03 1.95 1.69 4.67 0.26

Source: Snohomish County Assessors Office

Note: See notes to the financial statements (Note 3B) for additional information on the property tax rates and limitations. a Overlapping rates are those of local governments that apply to property owners within the county. Not all overlapping rates apply to all county property owners; for example, although the county property tax rates apply to all city property owners, the Fire Protection Districts rates apply only to the property owners whose property is located within that district's geographic boundaries. 2017 Statistical Section Snohomish County Principal Property Tax Payers Current and Nine Years Ago 2017 2008 Percentage of Percentage of Taxable Total Taxable Taxable Total Taxable Assessed Assessed Assessed Assessed Taxpayer Value Rank Value Value Rank Value Boeing 3,354,334,043 1 3.19% 1,700,232,022 1 1.71% Frontier Communications NW 271,261,940 2 0.26% - - Puget Sound Energy/Gas 260,267,472 3 0.25% 150,215,250 6 0.15% Equity Assets Mgmt Inc 231,728,473 4 0.22% 282,824,295 3 0.28% Kroger Co 188,604,839 5 0.18% - - Starwood Capital Group 148,041,000 6 0.14% - - Alderwood Mall LLC 146,599,895 7 0.14% 134,841,114 9 0.14% Essex Property Trust 143,625,126 8 0.14% - - Bre Properties Inc 143,451,000 9 0.14% - - GS Brandemoor LLC 130,889,600 10 0.12% - - Avalon Bay Communities Inc - - 159,659,527 5 0.16% GTE/Verizon - - 417,534,088 2 0.42% Kimberly Clark - - 202,650,500 4 0.20% Fred Meyer - - 144,143,166 7 0.15% Teachers Ins & Annuity Assn - - 137,090,681 8 0.14% Arden Realty Inc. - - 120,425,636 10 0.12% Total 5,018,803,388 4.78% 3,449,616,279 3.47%

Total Taxable Assessed Value 105,036,086,924 99,315,203,205

Source: Snohomish County Assessors Office

146 2017 Statistical Section

Snohomish County Property Tax Levies and Collections Last Ten Years

Collected within the Year of the Levy Total Collections to Date

Ended Taxes Levied Percentage of Percentage Collections in Percentage of Percentage December 31 for the Year Amount Levy Delinquent Subsequent Years Amount Levy Delinquent 2008 $ 121,710,716 $ 118,200,808 97.12% 2.88% $ 3,441,363 $ 121,642,171 99.94% 0.06% 2009 124,384,581 120,345,772 96.75% 3.25% 4,033,130 124,378,902 100.00% 0.00% 2010 125,434,420 121,912,597 97.19% 2.81% 3,479,305 125,391,902 99.97% 0.03% 2011 126,801,495 123,516,975 97.41% 2.59% 3,245,840 126,762,815 99.97% 0.03% 2012 128,917,306 126,029,411 97.76% 2.24% 2,831,270 128,860,681 99.96% 0.04% 2013 133,118,638 131,174,398 98.54% 1.46% 1,859,132 133,033,530 99.94% 0.06% 2014 142,529,849 139,697,030 98.01% 1.99% 2,721,219 142,418,249 99.92% 0.08% 2015 147,244,065 144,832,838 98.36% 1.64% 2,038,725 146,871,563 99.75% 0.25% 2016 150,460,628 148,029,238 98.38% 1.62% 1,731,644 149,760,882 99.53% 0.47% 2017 154,844,994 152,418,576 98.43% 1.57% - 152,418,576 98.43% 1.57%

Source: Snohomish County Treasurers Office

147 2017 Statistical Section

Snohomish County Ratios of Outstanding Debt by Type Last Ten Years (amounts expressed in thousands, except per capita)

Governmental Activities Business-Type Activities General Special General Total Percentage of Obligation Assessment Other Obligation Other Primary Personal Per Year Bonds Bonds Debt Bonds Debt Government Incomea Capitaa 2008 $ 273,321 $ 910 $ 6,309 $ 78,725 $ 15,321 $ 374,586 1.28% $ 539 2009 266,860 765 8,008 80,105 15,246 370,984 1.32% 525 2010 273,844 630 9,510 78,986 14,485 377,455 1.33% 528 2011 265,832 505 8,573 75,547 13,253 363,710 1.21% 504 2012 258,100 360 8,134 110,095 12,078 388,767 1.22% 531 2013 352,123 265 7,219 104,432 11,399 475,438 1.45% 638 2014 337,092 135 6,296 98,493 10,224 452,240 1.29% 597 2015 336,647 45 5,535 95,167 9,048 446,442 1.21% 580 2016 322,461 - 4,943 88,782 7,764 423,950 1.09% 538 2017 307,640 - 4,517 82,189 6,498 400,844 1.03% 509

Note: Details regarding the County's outstanding debt can be found in the notes to the financial statements. a See Statistical Schedule - Demographic and Economic Statistics for personal income and population data.

148 2017 Statistical Section

Snohomish County Ratios of Net General Bonded Debt Outstanding Last Ten Years (amounts expressed in thousands, except per capita amount)

Percentage of General Estimated Obligation Actual Taxable Per Year Bonds Total Valuea of Property Capitab 2008 $ 352,046 $ 352,046 0.35% $ 507 2009 346,965 346,965 0.34% 491 2010 352,830 352,830 0.37% 493 2011 341,379 341,379 0.40% 473 2012 368,195 368,195 0.48% 503 2013 456,555 456,555 0.63% 613 2014 435,585 435,585 0.55% 575 2015 431,814 431,814 0.49% 561 2016 411,243 411,243 0.43% 522 2017 389,829 389,829 0.37% 495

Note: Details regarding the County's outstanding debt can be found in the notes to the financial statements. a See Statistical Schedule - Assessed Value and Estimated Actual Value of Taxable Property for property value data. b See Statistical Schedule - Demographic and Economic Statistics for population data.

149 2017 Statistical Section Snohomish County Direct and Overlapping Governmental Activities Debt As of December 31, 2017 Estimated Estimated Debt Percentage Share of Governmental Unit Outstanding Applicable Overlapping Debt Debt repaid with property taxes: Cities and Towns: City of Arlington $ 16,619,296 100.00% $ 16,619,296 City of Bothell 88,779,173 42.00% 37,287,253 Town of Darrington 71,073 100.00% 71,073 City of Edmonds 7,258,862 100.00% 7,258,862 City of Everett 43,890,248 100.00% 43,890,248 City of Granite Falls 6,686,182 100.00% 6,686,182 City of Lake Stevens 3,150,346 100.00% 3,150,346 City of Lynnwood 23,177,124 100.00% 23,177,124 City of Marysville 22,773,138 100.00% 22,773,138 City of Monroe 5,972,600 100.00% 5,972,600 City of Mountlake Terrace 1,345,000 100.00% 1,345,000 City of Mukilteo 9,050,000 100.00% 9,050,000 City of Snohomish 400,000 100.00% 400,000 City of Stanwood 555,000 100.00% 555,000 City of Sultan 330,000 100.00% 330,000 Town of Woodway 1,748,257 100.00% 1,748,257 Total Cities and Towns 231,806,299 180,314,379 School Districts: Arlington 18,295,000 100.00% 18,295,000 Darrington 1,391,487 92.78% 1,291,021 Edmonds 335,505,000 100.00% 335,505,000 Everett 171,380,000 100.00% 171,380,000 Granite Falls 33,740,000 100.00% 33,740,000 Lake Stevens 135,475,000 100.00% 135,475,000 Lakewood 55,420,000 100.00% 55,420,000 Marysville 66,088,000 100.00% 66,088,000 Monroe 98,665,000 100.00% 98,665,000 Mukilteo 111,980,000 100.00% 111,980,000 Northshore 382,105,227 36.77% 140,500,092 Snohomish 306,200,000 100.00% 306,200,000 Stanwood-Camano 37,180,000 43.86% 16,307,148 Sultan 427,679 100.00% 427,679 Total School Districts 1,753,852,393 1,491,273,940 Fire Districts 9,446,267 100.00% 9,446,267 Libraries: King County Library 89,356,000 1.29% 1,152,692 Monroe LCFA 1,371,439 100.00% 1,371,439 Snohomish LCFA 1,679,205 87.50% 1,469,304 Total Libraries 92,406,644 3,993,435 Parks: Northshore Parks & Recreation 1,075,000 36.76% 395,170 Total Parks 1,075,000 395,170 Subtotal, overlapping debt 2,088,586,603 1,685,423,191 Snohomish County direct debt 312,156,611 100.00% 312,156,611 Total direct and overlapping debt $ 2,400,743,214 $ 1,997,579,802

Sources: Outstanding debt data provided by each governmental unit. Applicable percentage calculated based on assessed values provided by Snohomish County Assessors Office, King County Assessors Office, and Pierce County Assessors Office. Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the County. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the County. This process recognizes that, when considering the County's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore, responsible for repaying the debt, for each overlapping government.

150 151

2017 Statistical Section Snohomish County Legal Debt Margin Information Last Ten Years (amounts expressed in thousands)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Assessed Value $ 101,983,434 $ 94,125,213 $ 85,710,608 $ 76,647,038 $ 72,621,623 $ 79,448,742 $ 88,260,208 $96,080,093 $ 105,036,087 $ 118,417,726

Limited Tax General Obligation Debt Not Requiring a Vote: Debt Limit - 1.5% of Total Assessed Value 1,529,752 1,411,878 1,285,659 1,149,706 1,089,324 1,191,731 1,323,903 1,441, 201 1,575,541 1,776,266 Debt applicable to limit: General obligation debt 373,675 370,220 376,825 419,578 426,584 513,513 494,517 605,064 631,732 585,109 Less: Amount set aside for repayment of general obligation debt (11,672) (9,940) (7,679) (7,937) (5,573) (3,709) (2, 211) (71) (77) (83) Total net debt applicable to limit 362,003 360,280 369,146 411,641 421,011 509,804 492,306 604,993 631,655 585,026 Remaining Debt Capacity Not Requiring Vote $ 1,167,748 $ 1,051,598 $ 916,513 $ 738,065 $ 668,313 $ 681,927 $ 831,597 $ 836, 208 $ 943,886 $ 1,191,240

Total net debt applicable to the limit as a percentage of debt limit 23.66% 25.52% 28.71% 35.80% 38.65% 42.78% 37.19% 41.98% 40.09% 32.94%

Tax General Obligation Debt Including Voted Debt: Debt Limit - 2.5% of Total Assessed Value 2,549,586 2,353,130 2,142,765 1,916,176 1,815,541 1,986,219 2,206,505 2,402, 002 2,625,902 2,960,443 Debt applicable to limit: General obligation debt 373,675 370,220 376,825 419,578 426,584 513,513 494,517 605,064 631,732 585,109 Less: Amount set aside for repayment of general obligation debt (11,672) (9,940) (7,679) (7,937) (5,573) (3,709) (2, 211) (71) (77) (83) Total net debt applicable to limit 362,003 360,280 369,146 411,641 421,011 509,804 492,306 604,993 631,655 585,026 Remaining Debt Capacity Including Voted Debt $ 2,187,583 $ 1,992,850 $ 1,773,619 $ 1,504,535 $ 1,394,530 $ 1,476,415 $ 1,714,199 $ 1,797, 009 $ 1,994,247 $ 2,375,417

Total net debt applicable to the limit as a percentage of debt limit 14.20% 15.31% 17.23% 21.48% 23.19% 25.67% 22.31% 25.19% 24.05% 19.76%

Note: In compliance with Washington State Budgeting, Accounting and Reporting System (BARS), the most current assessed value is used for a given fiscal year and is for the following calendar year's tax roll. 2017 Statistical Section Snohomish County Demographic and Economic Statistics Last Ten Years

Personal Per Capita Income Personal Unemployment a a a a Year Population (in thousands) Income Rate 2008 694,622 $ 29,344,289 $ 42,245 4.6% 2009 706,302 28,009,888 39,657 9.4% 2010 715,523 28,347,132 39,617 10.7% 2011 722,291 30,074,645 41,638 9.5% 2012 732,378 31,981,676 43,668 7.5% 2013 745,124 32,895,034 44,147 5.8% 2014 757,958 35,053,955 46,248 5.2% 2015 770,165 36,746,804 47,713 4.7% 2016 787,620 38,996,032 49,511 4.3% 2017b 787,620 38,996,032 49,511 4.1%

Source: Population, personal income, and per capita personal income provided by US Bureau of Economic Analysis. Unemployment rate provided by Washington State Employment Security Department. a Each year the data is updated to reflect the updated information provided by the US Bureau of Economic Analysis and Washington State Employment Department. b Current years data for population and personal income was not available at the time of statistical table completion so prior year numbers were used.

152 2017 Statistical Section Snohomish County Principal Employers Current Year and Nine Years Ago

2017 2008 Percentage Percentage of Total County of Total County Employer Employees Rank Employment Employees Rank Employment The Boeing Company 34,500 1 8.54% 35,000 1 9.83% Providence Regional Medical Center 4,775 2 1.18% 3,220 3 0.90% The Tulalip Tribes 3,200 3 0.79% 2,300 7 0.65% Naval Station Everett 2,987 4 0.74% 6,000 2 1.69% Washington State Government 2,950 5 0.73% 3,000 5 0.84% Snohomish County Government 2,617 6 0.65% 2,700 6 0.76% Edmonds School District 2,605 7 0.64% - - Premera Blue Cross 2,600 8 0.64% 3,200 4 0.90% Walmart 2,312 9 0.57% - - The Everett Clinic 2,255 10 0.56% - - Everett School District - - 1,700 8 0.48% Phillips Medical Systems - - 1,600 9 0.45% Verizon Northwest - - 1,500 10 0.42% Zumiez - - 1,500 10 0.42% Total 60,801 15.05% 61,720 17.34%

Total County Employment 403,990 355,995

Source: Economic Alliance

153 2017 Statistical Section Snohomish County Full-time Equivalent County Government Employees by Function Last Ten Years

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Function General Government 622 625 614 605 604 623 635 624 643 638 Judicial 235 225 221 220 223 228 234 230 223 233 Public Safety 927 884 865 856 873 880 869 877 877 899 Physical Environment 231 216 206 201 209 201 202 201 210 233 Transportation 410 476 465 448 412 423 413 408 404 407 Health and Human Services 142 163 187 194 215 222 233 235 234 233 Economic Environment 165 124 115 115 124 76 104 108 94 114 Culture and Recreation 68 82 99 101 84 85 90 93 96 102 Total 2,800 2,795 2,772 2,740 2,744 2,738 2,780 2,776 2,781 2,859

Source: Snohomish County Finance 154 2017 Statistical Section Snohomish County Operating Indicators and Capital Assets by Function Last Ten Years 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Function Judicial Superior Court - New Case Filings Criminal 3,025 2,346 2,353 2,802 2,597 2,711 2,554 2,810 2,723 3,345 Civil 14,675 15,182 14,424 14,941 13,732 12,243 10,434 10,121 9,509 11,448 Domestic Violence 1,249 1,238 1,852 1,671 1,676 1,771 1,656 1,842 1,030 1,038 Domestic 3,069 3,205 3,129 3,251 3,268 3,230 3,141 3,137 3,064 2,977 Probate 1,584 1,645 1,633 1,718 1,749 1,711 1,867 1,993 2,024 2,179 Adoption/Paternity 1,152 1,162 1,097 954 931 776 697 688 615 571 Mental 790 742 827 793 808 785 815 1,025 1,165 1,285 Juvenile Case Type 7a 3,774 3,602 3,158 2,846 2,678 2,793 2,663 2,142 1,517 1,464 Juvenile Offender 1,948 1,898 1,627 1,611 1,336 1,288 1,228 1,322 701 882 District Court Infractions 92,068 106,841 99,195 104,050 92,916 79,750 68,313 60,923 49,995 48,993 DUI 2,868 3,326 3,233 3,090 2,692 2,387 2,245 2,099 1,528 2,055 Criminal Traffic 6,101 5,350 4,522 3,685 2,417 2,061 1,630 1,303 824 1,096 Criminal Misdemeanors 5,743 7,651 6,959 7,779 7,122 6,232 6,409 5,708 4,523 5,659 Civil 14,433 12,024 12,816 12,395 10,286 13,401 13,088 11,767 10,399 10,724 Small Claims 2,280 2,124 1,742 1,455 1,406 1,334 1,275 1,197 1,233 1,281 Felony 6,016 5,733 5,628 6,080 6,389 7,166 7,034 6,905 6,793 6,723 Protection Orderse 1,157 1,273 1,269 1,199 1,156 1,113 913 870 925 990 Public Safety Sheriff Call Responders 200 193 173 179 186 186 201 187 201 205 Total 911-Initiated Calls 142,706 136,723 125,753 118,132 132,569 127,417 142,788 149,282 142,469 144,730 Total Self-Initiated Calls 125,638 135,789 116,119 116,739 128,385 112,176 114,482 102,271 101,737 97,668 Precincts 3 3 3 3 3 3 3 3 3 3 Sheriff Vehicles 409 420 355 346 357 357 362 366 349 360 Corrections Bookings 24,304 25,447 25,111 27,411 27,120 26,195 21,710 17,953 18,935 19,104 Average Daily Population 1,226 1,180 1,163 1,198 1,179 1,171 1,028 952 901 956 Physical Environment Surface Waterd Miles of Habitat Restored 6 13 3 11 1 0 3 0 0 0 Stormwater Facility Inspections Unavailable Unavailable Unavailable 781 1,412 1,889 1,685 2,354 2,510 1,441 Business Inspections Unavailable 1,171 530 737 753 733 654 333 616 321 Water Quality Complaints Unavailable 125 140 142 129 116 96 95 101 80 Drainage Investigations 300 338 309 344 343 269 264 291 324 301 Solid Waste Customers Served 551,675 567,476 513,122 506,393 512,793 544,044 570,842 626,191 678,056 720,064 Tons Exported (refuse) 456,744 419,129 403,531 394,825 420,456 422,159 440,858 465,854 497,722 523,588 Tons Exported (recycle) 16,308 14,506 14,292 11,466 13,469 15,481 16,109 19,295 19,916 15,451 Transfer Stations 3 4 4 4 4 4 4 4 4 4 Drop Box Sites 5 5 3 3 3 3 3 3 3 3 Moderate Risk Waste Facility 1 1 1 1 1 1 1 1 1 1 Transportation County Roads Miles of Road Resurfacedb 93 93 68 82 79 66 68 96 93 57 Miles of Road (FFC7,8,9,14,16,17,19) 1,660 1,560 1,560 1,565 1,565 1,565 1,561 1,586 1,590 1,598 County Road Vehicles & Equipment 479 587 586 580 564 572 506 471 495 489 Bridges 206 196 195 196 196 200 200 202 204 204 Airport Runways 3 3 3 3 3 3 3 3 3 3 Taxiways 10 11 11 11 11 11 11 11 11 11 Parking Ramps 6 8 8 8 8 9 9 9 6 6 Health and Human Services Human Services Children Receiving ECEAPc Services 1,061 976 976 976 972 996 1,137 1,232 1,233 1,323 Households Receiving Energy Assistance 6,532 8,563 14,113 13,877 7,583 7,180 6,832 6,253 4,756 3,892 Vouchers Issued to Veterans 3,887 3,441 3,204 3,186 1,731 1,894 1,748 1,364 1,289 1,094 Economic Environment Planning and Development Services Permits Issued 9,825 5,826 5,717 6,289 6,394 7,253 7,764 8,471 9,037 14,186 Customers Served 23,985 15,682 12,728 12,952 16,337 14,731 16,190 17,481 18,055 17,846 Annexations 11 16 3 4 5 4 2 7 6 8 Culture and Recreation Parks Parks Facility Users 2,011,958 2,489,693 2,585,328 3,294,099 3,111,398 4,233,215 3,439,495 3,142,334 2,755,032 2,701,076 Fair Facility Users 1,063,637 933,155 979,622 542,711 613,732 589,272 254,508 544,325 585,111 598,557 Parkland Acreage 10,123 10,121 10,201 10,634 10,769 10,796 11,163 11,380 11,793 11,720 Golf Courses 1 1 1 1 1 1 1 1 1 1

Source: Various county departments. Note: Indicators and capital assets are not available for the general government function. a Dependency, Termination of Parental Rights, At Risk Youth, Child in Need of Services & Truancy b Centerline Miles of roadway preservation and rehabilitation c ECEAP (Early Childhood Education and Assistance Program) d In 2015, Surface Water added Stormwater Facility Inspections, Business Inspections, Water Quality Complaints and Drainage Investigations. Miles of Habitat restored will no longer be tracked as an operating indicator e In 2015, District Courts added Protection Orders as an operating indicator

155

Snohomish County, Washington

Compliance Section

2017 Schedule of Expenditures of Federal Awards

Expenditures From Pass- Federal Agency CFDA Other Award Through From Direct Passed through (Pass-Through Agency) Federal Program Number Number Awards Awards Total to Subrecipients Child Nutrition Cluster Food And Nutrition Service, Department School Breakfast Program 10.553 159863 7,901 - 7,901 - Of Agriculture (via Office of Superintendent of Public Instruction)

Food And Nutrition Service, Department School Breakfast Program 10.553 159863 4,351 - 4,351 - Of Agriculture (via Office of Superintendent of Public Instruction)

Total CFDA 10.553: 12,252 - 12,252 - Food And Nutrition Service, Department National School Lunch Program 10.555 159863 14,332 - 14,332 - Of Agriculture (via Office of Superintendent of Public Instruction)

Food And Nutrition Service, Department National School Lunch Program 10.555 159863 7,868 - 7,868 - Of Agriculture (via Office of Superintendent of Public Instruction)

Total CFDA 10.555: 22,200 - 22,200 - Total Child Nutrition Cluster: 34,452 - 34,452 -

Food And Nutrition Service, Department Senior Farmers Market Nutrition 10.576 1669-68460 16,227 - 16,227 15,727 Of Agriculture (via WA State Department Program of Social and Health Services)

Forest Service Schools and Roads Cluster Forest Service, Department Of Agriculture Schools and Roads - Grants to 10.665 N/A 59,825 - 59,825 - (via WA State Treasurer) States Total Forest Service Schools and Roads Cluster: 59,825 - 59,825 -

National Oceanic And Atmospheric Pacific Coast Salmon Recovery 11.438 14-1306 30,043 - 30,043 - Administration (noaa), Department Of Pacific Salmon Treaty Program Commerce (via WA State Recreation and Conservation Office) National Oceanic And Atmospheric Pacific Coast Salmon Recovery 11.438 15-1110 23,039 - 23,039 - Administration (noaa), Department Of Pacific Salmon Treaty Program Commerce (via WA State Recreation and Conservation Office) National Oceanic And Atmospheric Pacific Coast Salmon Recovery 11.438 15-1333 36,336 - 36,336 - Administration (noaa), Department Of Pacific Salmon Treaty Program Commerce (via WA State Recreation and Conservation Office) National Oceanic And Atmospheric Pacific Coast Salmon Recovery 11.438 15-1405 23,781 - 23,781 - Administration (noaa), Department Of Pacific Salmon Treaty Program Commerce (via WA State Recreation and Conservation Office) National Oceanic And Atmospheric Pacific Coast Salmon Recovery 11.438 15-1406 (FED) 23,590 - 23,590 - Administration (noaa), Department Of Pacific Salmon Treaty Program Commerce (via WA State Recreation and Conservation Office) Total CFDA 11.438: 136,789 - 136,789 -

National Oceanic And Atmospheric Habitat Conservation 11.463 NA13NMF-4630142 - 51,067 51,067 - Administration (noaa), Department Of Commerce CDBG - Entitlement Grants Cluster Office Of Community Planning And Community Development Block 14.218 B-14-UC-53-0003 - 361,899 361,899 348,362 Development, Department Of Housing Grants/Entitlement Grants And Urban Development Office Of Community Planning And Community Development Block 14.218 B-14-UC-53-2003 - 9,706 9,706 - Development, Department Of Housing Grants/Entitlement Grants DII And Urban Development Office Of Community Planning And Community Development Block 14.218 B-15-UC-53-0003 - 625,587 625,587 610,928 Development, Department Of Housing Grants/Entitlement Grants And Urban Development Office Of Community Planning And Community Development Block 14.218 B-16-UC-53-0003 - 1,400,020 1,400,020 1,130,129 Development, Department Of Housing Grants/Entitlement Grants And Urban Development Office Of Community Planning And Community Development Block 14.218 B-17-UC-53-0003 - 1,110,228 1,110,228 938,656 Development, Department Of Housing Grants/Entitlement Grants And Urban Development Total CDBG - Entitlement Grants Cluster: - 3,507,440 3,507,440 3,028,075

156 2017 Schedule of Expenditures of Federal Awards

Expenditures From Pass- Federal Agency CFDA Other Award Through From Direct Passed through (Pass-Through Agency) Federal Program Number Number Awards Awards Total to Subrecipients Office Of Community Planning And Emergency Solutions Grant 14.231 14-46107-010 229,931 - 229,931 216,160 Development, Department Of Housing Program And Urban Development (via WA State Department of Commerce) Office Of Community Planning And Emergency Solutions Grant 14.231 17-46107-010 87,622 - 87,622 87,622 Development, Department Of Housing Program And Urban Development (via WA State Department of Commerce) Office Of Community Planning And Emergency Solutions Grant 14.231 E-15-UC-53-0003 - 1,441 1,441 - Development, Department Of Housing Program And Urban Development Office Of Community Planning And Emergency Solutions Grant 14.231 E-16-UC-53-0004 - 154,872 154,872 130,493 Development, Department Of Housing Program And Urban Development Office Of Community Planning And Emergency Solutions Grant 14.231 E-17-UC-53-0003 - 64,115 64,115 53,895 Development, Department Of Housing Program And Urban Development Total CFDA 14.231: 317,553 220,428 537,981 488,170

Office Of Community Planning And Home Investment Partnerships 14.239 M-12-DC-53-0201 - 344 344 344 Development, Department Of Housing Program And Urban Development Office Of Community Planning And Home Investment Partnerships 14.239 M-13-DC-53-0201 - 536,169 536,169 536,169 Development, Department Of Housing Program And Urban Development Office Of Community Planning And Home Investment Partnerships 14.239 M-14-DC-53-0201 - 423,094 423,094 423,094 Development, Department Of Housing Program And Urban Development Office Of Community Planning And Home Investment Partnerships 14.239 M-15-DC-53-0201 - 527,690 527,690 527,690 Development, Department Of Housing Program And Urban Development Office Of Community Planning And Home Investment Partnerships 14.239 M-16-DC-53-0201 - 607,509 607,509 570,336 Development, Department Of Housing Program And Urban Development Office Of Community Planning And Home Investment Partnerships 14.239 M-17-DC-53-0201 - 129,983 129,983 101,082 Development, Department Of Housing Program And Urban Development Total CFDA 14.239: - 2,224,789 2,224,789 2,158,715

Office Of Community Planning And Continuum of Care Program 14.267 WA0000U0T04150 - 2,368,250 2,368,250 2,224,430 Development, Department Of Housing 0 And Urban Development Office Of Community Planning And Continuum of Care Program 14.267 WA0000U0T04160 - 3,300,224 3,300,224 3,078,251 Development, Department Of Housing 2 And Urban Development Office Of Community Planning And Continuum of Care Program 14.267 WA9000U0T04150 - 498,994 498,994 356,275 Development, Department Of Housing 0 And Urban Development Office Of Community Planning And Continuum of Care Program 14.267 WA9001U0T04160 - 55,829 55,829 - Development, Department Of Housing 0 And Urban Development Total CFDA 14.267: - 6,223,297 6,223,297 5,658,956

Fish And Wildlife Service, Department Of Coastal Wetlands Planning, 15.614 C1600212 87,665 - 87,665 - The Interior (via WA State Department of Protection and Restoration Ecology)

Office For Victims Of Crime, Department Crime Victim Assistance 16.575 S17-31102-528 43,443 - 43,443 - Of Justice (via WA State Department of Commerce) Office For Victims Of Crime, Department Crime Victim Assistance 16.575 S18-31102-528 43,273 - 43,273 - Of Justice (via WA State Department of Commerce) Total CFDA 16.575: 86,716 - 86,716 -

Violence Against Women Office, Violence Against Women 16.588 DV STOP GRANT 5,892 - 5,892 - Department Of Justice (via City of Everett) Formula Grants 2017

Violence Against Women Office, Violence Against Women 16.588 F16-31103-034 32,169 - 32,169 - Department Of Justice (via WA State Formula Grants Department of Commerce) Violence Against Women Office, Violence Against Women 16.588 F16-31103-106 31,387 - 31,387 - Department Of Justice (via WA State Formula Grants Department of Commerce) Total CFDA 16.588: 69,448 - 69,448 -

157 2017 Schedule of Expenditures of Federal Awards

Expenditures From Pass- Federal Agency CFDA Other Award Through From Direct Passed through (Pass-Through Agency) Federal Program Number Number Awards Awards Total to Subrecipients Bureau Of Justice Assistance, Department Edward Byrne Memorial Justice 16.738 2016-DJ-BX-0131 - 33,664 33,664 - Of Justice Assistance Grant Program

Bureau Of Justice Assistance, Department Edward Byrne Memorial Justice 16.738 F16-31440-015 80,800 - 80,800 - Of Justice (via WA State Department of Assistance Grant Program Commerce) Total CFDA 16.738: 80,800 33,664 114,464 -

Federal Aviation Administration (faa), Airport Improvement Program 20.106 3-53-0028-57 - 2,870,116 2,870,116 - Department Of Transportation Highway Planning and Construction Cluster Federal Highway Administration (fhwa), Highway Planning and 20.205 BRM-2563(001) 69,515 - 69,515 - Department Of Transportation (via WA Construction State Department of Transportation)

Federal Highway Administration (fhwa), Highway Planning and 20.205 BROS-2031(109) 282,086 - 282,086 - Department Of Transportation (via WA Construction State Department of Transportation)

Federal Highway Administration (fhwa), Highway Planning and 20.205 BROS-2031(111) 1,961,360 - 1,961,360 - Department Of Transportation (via WA Construction State Department of Transportation)

Federal Highway Administration (fhwa), Highway Planning and 20.205 BROS-2031(113) 218,759 - 218,759 - Department Of Transportation (via WA Construction State Department of Transportation)

Federal Highway Administration (fhwa), Highway Planning and 20.205 BRS-V310(002) 1,343,009 - 1,343,009 - Department Of Transportation (via WA Construction State Department of Transportation)

Federal Highway Administration (fhwa), Highway Planning and 20.205 CM-9931(013) 112,017 - 112,017 - Department Of Transportation (via WA Construction State Department of Transportation)

Federal Highway Administration (fhwa), Highway Planning and 20.205 CM-9931(018) 21,255 - 21,255 - Department Of Transportation (via WA Construction State Department of Transportation)

Federal Highway Administration (fhwa), Highway Planning and 20.205 ER-0701(063) 1,409,744 - 1,409,744 - Department Of Transportation (via WA Construction State Department of Transportation)

Federal Highway Administration (fhwa), Highway Planning and 20.205 HSIP-000S(458) 1,009,466 - 1,009,466 - Department Of Transportation (via WA Construction State Department of Transportation)

Federal Highway Administration (fhwa), Highway Planning and 20.205 STPUL-2031(114) 9,621 - 9,621 - Department Of Transportation (via WA Construction State Department of Transportation)

Federal Highway Administration (fhwa), Highway Planning and 20.205 STPUL-2576(006) 3,814,606 - 3,814,606 - Department Of Transportation (via WA Construction State Department of Transportation)

Federal Highway Administration (fhwa), Highway Planning and 20.205 STPUL-9931(009) 1,067 - 1,067 - Department Of Transportation (via WA Construction State Department of Transportation)

Total Highway Planning and Construction Cluster: 10,252,506 - 10,252,506 - Highway Safety Cluster National Highway Traffic Safety State and Community Highway 20.600 2017 Traffic 16,031 - 16,031 - Administration (nhtsa), Department Of Safety Transportation (via WA State Traffic Safety Commission) National Highway Traffic Safety State and Community Highway 20.600 Distracted Driving 3,960 - 3,960 - Administration (nhtsa), Department Of Safety 16-17 Transportation (via WA State Traffic Safety Commission) National Highway Traffic Safety State and Community Highway 20.600 Target Zero 51,981 - 51,981 - Administration (nhtsa), Department Of Safety Manager 2016 Transportation (via WA State Traffic Safety Commission)

158 2017 Schedule of Expenditures of Federal Awards

Expenditures From Pass- Federal Agency CFDA Other Award Through From Direct Passed through (Pass-Through Agency) Federal Program Number Number Awards Awards Total to Subrecipients National Highway Traffic Safety State and Community Highway 20.600 TZ Manager 2017- 18,967 - 18,967 - Administration (nhtsa), Department Of Safety 2020 Transportation (via WA State Traffic Safety Commission) National Highway Traffic Safety State and Community Highway 20.600 Impaired Driving 16- 8,776 - 8,776 - Administration (nhtsa), Department Of Safety 17 Transportation (via WA State Traffic Safety Commission) National Highway Traffic Safety State and Community Highway 20.600 Impaired Driving 17- 6,708 - 6,708 - Administration (nhtsa), Department Of Safety 18 Transportation (via WA State Traffic Safety Commission) National Highway Traffic Safety State and Community Highway 20.600 Seat Belt Emphasis 2,378 - 2,378 - Administration (nhtsa), Department Of Safety 16-17 Transportation (via WA State Traffic Safety Commission) National Highway Traffic Safety State and Community Highway 20.600 Flex 16-17 5,050 - 5,050 - Administration (nhtsa), Department Of Safety Transportation (via WA State Traffic Safety Commission) Total CFDA 20.600: 113,850 - 113,850 - National Highway Traffic Safety National Priority Safety 20.616 AG-1895 49,468 - 49,468 - Administration (nhtsa), Department Of Programs Transportation (via WA State Traffic Safety Commission) National Highway Traffic Safety National Priority Safety 20.616 17-18 TZT 4,567 - 4,567 - Administration (nhtsa), Department Of Programs Transportation (via WA State Traffic Safety Commission) National Highway Traffic Safety National Priority Safety 20.616 Motorcycle 16-17 2,868 - 2,868 - Administration (nhtsa), Department Of Programs Transportation (via WA State Traffic Safety Commission) Total CFDA 20.616: 56,903 - 56,903 - Total Highway Safety Cluster: 170,753 - 170,753 -

Region 10, Environmental Protection Puget Sound Action Agenda: 66.123 2017-24 47,435 - 47,435 - Agency (via Puget Sound Partnership) Technical Investigations and Implementation Assistance Program Region 10, Environmental Protection Puget Sound Action Agenda: 66.123 G1400647 20,629 - 20,629 - Agency (via WA State Department of Technical Investigations and Ecology) Implementation Assistance Program Region 10, Environmental Protection Puget Sound Action Agenda: 66.123 G1500048 62,100 - 62,100 - Agency (via WA State Department of Technical Investigations and Ecology) Implementation Assistance Program Region 10, Environmental Protection Puget Sound Action Agenda: 66.123 N22513 2,749 - 2,749 - Agency (via WA State Department of Technical Investigations and Health) Implementation Assistance Program Region 10, Environmental Protection Puget Sound Action Agenda: 66.123 SEANWS-2016- 53,556 - 53,556 - Agency (via WA State Department of Technical Investigations and SnCoPW-00007 Ecology) Implementation Assistance Program Region 10, Environmental Protection Puget Sound Action Agenda: 66.123 SEANWS-2017- 13,792 - 13,792 - Agency (via WA State Department of Technical Investigations and SnCoPW-00005 Ecology) Implementation Assistance Program Region 10, Environmental Protection Puget Sound Action Agenda: 66.123 17-08280 113,474 - 113,474 - Agency (via WA Dept of Fish & Wildlife) Technical Investigations and Implementation Assistance Program Total CFDA 66.123: 313,735 - 313,735 -

Office Of Water, Environmental Protection National Estuary Program 66.456 2018-12 27,392 - 27,392 - Agency (via Puget Sound Partnership)

Department Of Energy (via WA State Weatherization Assistance for 81.042 F16-43103-422 130,609 - 130,609 - Department of Commerce) Low-Income Persons Department Of Energy (via WA State Weatherization Assistance for 81.042 F17-43103-422 99,094 - 99,094 - Department of Commerce) Low-Income Persons Total CFDA 81.042: 229,703 - 229,703 -

159 2017 Schedule of Expenditures of Federal Awards

Expenditures From Pass- Federal Agency CFDA Other Award Through From Direct Passed through (Pass-Through Agency) Federal Program Number Number Awards Awards Total to Subrecipients U.S. Department of Energy (via WA State BPA Weatherization Program 81.999 F15-43104-422 108,323 - 108,323 - Department of Commerce) U.S. Department of Energy (via WA State BPA Weatherization Program 81.999 F17-33104-422 31,708 - 31,708 - Department of Commerce) Total CFDA 81.999: 140,031 - 140,031 -

Office Of Special Education And Special Education-Grants for 84.181 16-1030 463,810 - 463,810 304,551 Rehabilitative Services, Department Of Infants and Families Education (via WA State Department of Early Learning) Office Of Special Education And Special Education-Grants for 84.181 18-1021 325,642 - 325,642 189,183 Rehabilitative Services, Department Of Infants and Families Education (via WA State Department of Early Learning) Total CFDA 84.181: 789,452 - 789,452 493,734

Office Of The Secretary, Department Of Medical Reserve Corps Small 93.008 MRC-16-0174 5,962 - 5,962 - Health And Human Services (via National Grant Program Assocation of County and City Health Officials)

Administration For Community Living, Special Programs for the Aging, 93.041 1769-81060 1,162 - 1,162 1,162 Department Of Health And Human Title VII, Chapter 3, Programs Services (via WA State Department of for Prevention of Elder Abuse, Social and Health Services) Neglect, and Exploitation

Administration For Community Living, Special Programs for the Aging, 93.043 1769-81060 30,327 - 30,327 30,327 Department Of Health And Human Title III, Part D, Disease Services (via WA State Department of Prevention and Health Social and Health Services) Promotion Services Aging Cluster Administration For Community Living, Special Programs for the Aging, 93.044 1769-81060 780,093 - 780,093 567,438 Department Of Health And Human Title III, Part B, Grants for Services (via WA State Department of Supportive Services and Senior Social and Health Services) Centers Administration For Community Living, Special Programs for the Aging, 93.045 1769-81060 394,501 - 394,501 355,051 Department Of Health And Human Title III, Part C, Nutrition Services (via WA State Department of Services Social and Health Services) Administration For Community Living, Special Programs for the Aging, 93.045 1769-81060 365,264 - 365,264 328,738 Department Of Health And Human Title III, Part C, Nutrition Services (via WA State Department of Services Social and Health Services) Total CFDA 93.045: 759,765 - 759,765 683,789 Administration For Community Living, Nutrition Services Incentive 93.053 1769-81060 163,244 - 163,244 163,244 Department Of Health And Human Program Services (via WA State Department of Social and Health Services) Total Aging Cluster: 1,703,102 - 1,703,102 1,414,471

Administration For Community Living, National Family Caregiver 93.052 1769-81060 232,241 - 232,241 209,017 Department Of Health And Human Support, Title III, Part E Services (via WA State Department of Social and Health Services)

Administration For Community Living, Medicare Enrollment Assistance 93.071 1469-28372 8,195 - 8,195 8,195 Department Of Health And Human Program Services (via WA State Department of Social and Health Services)

Substance Abuse And Mental Health Substance Abuse and Mental 93.243 5H79TI025498-03 - 45,085 45,085 - Services Administration, Department Of Health Services Projects of Health And Human Services Regional and National Significance

U.S. Department of Health and Human Affordable Care Act – Aging and 93.517 1369-78493 1,500 - 1,500 - Services (via WA State Department of Disability Resource Center Social and Health Services)

Administration For Children And Families, Child Support Enforcement 93.563 2110-80559 807,820 - 807,820 - Department Of Health And Human Services (via WA State Department of Social and Health Services)

160 2017 Schedule of Expenditures of Federal Awards

Expenditures From Pass- Federal Agency CFDA Other Award Through From Direct Passed through (Pass-Through Agency) Federal Program Number Number Awards Awards Total to Subrecipients Administration For Children And Families, Child Support Enforcement 93.563 2110-80559 2,145,785 - 2,145,785 - Department Of Health And Human Services (via WA State Department of Social and Health Services)

Administration For Children And Families, Child Support Enforcement 93.563 1663-67354 105,438 - 105,438 - Department Of Health And Human Services (via WA State Department of Social and Health Services)

Total CFDA 93.563: 3,059,043 - 3,059,043 -

Administration For Children And Families, Low-Income Home Energy 93.568 16-32606-081 83,042 - 83,042 - Department Of Health And Human Assistance Services (via WA State Department of Commerce) Administration For Children And Families, Low-Income Home Energy 93.568 17-32606-081 1,769,954 - 1,769,954 - Department Of Health And Human Assistance Services (via WA State Department of Commerce) Administration For Children And Families, Low-Income Home Energy 93.568 F16-43101-422 614,199 - 614,199 - Department Of Health And Human Assistance Services (via WA State Department of Commerce) Administration For Children And Families, Low-Income Home Energy 93.568 F17-53101-422 229,367 - 229,367 - Department Of Health And Human Assistance Services (via WA State Department of Commerce) Total CFDA 93.568: 2,696,562 - 2,696,562 -

Administration For Children And Families, Community Services Block 93.569 F16-32101-026 449,731 - 449,731 58,288 Department Of Health And Human Grant Services (via WA State Department of Commerce) Administration For Children And Families, Community Services Block 93.569 F17-32101-026 42,696 - 42,696 - Department Of Health And Human Grant Services (via WA State Department of Commerce) Total CFDA 93.569: 492,427 - 492,427 58,288

Administration For Children And Families, Head Start 93.600 10CH0226-03 - 1,163,862 1,163,862 - Department Of Health And Human Services

Administration For Community Living, Empowering Older Adults and 93.734 1669-74056 30,000 - 30,000 30,000 Department Of Health And Human Adults with Disabilities through Services (via WA State Department of Chronic Disease Self- Social and Health Services) Management Education Programs – financed by Prevention and Public Health Funds (PPHF) Medicaid Cluster Centers For Medicare And Medicaid Medical Assistance Program 93.778 1669-68460 1,665,094 - 1,665,094 - Services, Department Of Health And Human Services (via WA State Department of Social and Health Services) Centers For Medicare And Medicaid Medical Assistance Program 93.778 1669-68460 104,040 - 104,040 28,804 Services, Department Of Health And Human Services (via WA State Department of Social and Health Services) Centers For Medicare And Medicaid Medical Assistance Program 93.778 1769-95449 319,802 - 319,802 45,000 Services, Department Of Health And Human Services (via WA State Department of Social and Health Services) Centers For Medicare And Medicaid Medical Assistance Program 93.778 1769-93495 154,552 - 154,552 48,198 Services, Department Of Health And Human Services (via WA State Department of Social and Health Services)

161 2017 Schedule of Expenditures of Federal Awards

Expenditures From Pass- Federal Agency CFDA Other Award Through From Direct Passed through (Pass-Through Agency) Federal Program Number Number Awards Awards Total to Subrecipients Centers For Medicare And Medicaid Medical Assistance Program 93.778 1769-93495 1,713,966 - 1,713,966 - Services, Department Of Health And Human Services (via WA State Department of Social and Health Services) Total Medicaid Cluster: 3,957,454 - 3,957,454 122,002

Centers For Medicare And Medicaid Money Follows the Person 93.791 1669-68460 10,570 - 10,570 - Services, Department Of Health And Rebalancing Demonstration Human Services (via WA State Department of Social and Health Services) Centers For Medicare And Medicaid Money Follows the Person 93.791 1769-93495 11,196 - 11,196 - Services, Department Of Health And Rebalancing Demonstration Human Services (via WA State Department of Social and Health Services) Total CFDA 93.791: 21,766 - 21,766 -

Substance Abuse And Mental Health Block Grants for Community 93.958 North Sound BHO - 217,450 - 217,450 217,450 Services Administration, Department Of Mental Health Services Snohomish CO-M Health And Human Services (via North Sound Behavioral Health Organization)

Substance Abuse And Mental Health Block Grants for Community 93.958 North Sound BHO - 142,312 - 142,312 142,312 Services Administration, Department Of Mental Health Services Snohomish Count Health And Human Services (via North Sound Behavioral Health Organization)

Total CFDA 93.958: 359,762 - 359,762 359,762

Substance Abuse And Mental Health Block Grants for Prevention and 93.959 North Sound BHO - 81,707 - 81,707 - Services Administration, Department Of Treatment of Substance Abuse Snohomish Count Health And Human Services (via North Sound Behavioral Health Organization)

Substance Abuse And Mental Health Block Grants for Prevention and 93.959 North Sound BHG - 1,860 - 1,860 - Services Administration, Department Of Treatment of Substance Abuse Snohomish Count Health And Human Services (via North Sound Behavioral Health Organization)

Substance Abuse And Mental Health Block Grants for Prevention and 93.959 North Sound BHO - 34,260 - 34,260 - Services Administration, Department Of Treatment of Substance Abuse Snohomish Count Health And Human Services (via North Sound Behavioral Health Organization)

Total CFDA 93.959: 117,827 - 117,827 -

Executive Office Of The President (via High Intensity Drug Trafficking 95.001 9001600050 1,975 - 1,975 - Educational Service District 105) Areas Program Executive Office Of The President (via High Intensity Drug Trafficking 95.001 9001500073-02 100,125 - 100,125 - Educational Service District 105) Areas Program Executive Office Of The President (via High Intensity Drug Trafficking 95.001 9001500083 39,977 - 39,977 39,977 Educational Service District 105) Areas Program Executive Office Of The President High Intensity Drug Trafficking 95.001 G17NW0001A - 320,311 320,311 - Areas Program Executive Office Of The President High Intensity Drug Trafficking 95.001 G16NW0001A - 452,420 452,420 - Areas Program Total CFDA 95.001: 142,077 772,731 914,808 39,977

United States Coast Guard (uscg), Boating Safety Financial 97.012 2017 Grant 23,914 - 23,914 - Department Of Homeland Security (via Assistance WA State Parks and Recreation Commission)

Federal Emergency Management Agency Flood Mitigation Assistance 97.029 E15-063 14,336 - 14,336 2,722 (fema), Department Of Homeland Security (via WA State Military Department)

Federal Emergency Management Agency Flood Mitigation Assistance 97.029 E15-064 206,511 - 206,511 - (fema), Department Of Homeland Security (via WA State Military Department)

162 2017 Schedule of Expenditures of Federal Awards

Expenditures From Pass- Federal Agency CFDA Other Award Through From Direct Passed through (Pass-Through Agency) Federal Program Number Number Awards Awards Total to Subrecipients Federal Emergency Management Agency Flood Mitigation Assistance 97.029 E16-223 51,726 - 51,726 43,566 (fema), Department Of Homeland Security (via WA State Military Department)

Total CFDA 97.029: 272,573 - 272,573 46,288

Federal Emergency Management Agency Disaster Grants - Public 97.036 4168-DR-WA 177,717 - 177,717 - (fema), Department Of Homeland Security Assistance (Presidentially (via WA State Military Department) Declared Disasters)

Federal Emergency Management Agency Disaster Grants - Public 97.036 4056-DR-WA 139,295 - 139,295 - (fema), Department Of Homeland Security Assistance (Presidentially (via WA State Military Department) Declared Disasters)

Total CFDA 97.036: 317,012 - 317,012 -

Federal Emergency Management Agency Hazard Mitigation Grant 97.039 DR-4168-WA-1-R 36,677 - 36,677 - (fema), Department Of Homeland Security (via WA State Military Department)

Federal Emergency Management Agency Hazard Mitigation Grant 97.039 D16-011 247,488 - 247,488 - (fema), Department Of Homeland Security (via WA State Military Department)

Total CFDA 97.039: 284,165 - 284,165 -

Federal Emergency Management Agency Emergency Management 97.042 E17-134 245,919 - 245,919 - (fema), Department Of Homeland Security Performance Grants (via WA State Military Department)

Federal Emergency Management Agency Emergency Management 97.042 E18-085 107,479 - 107,479 - (fema), Department Of Homeland Security Performance Grants (via WA State Military Department)

Total CFDA 97.042: 353,398 - 353,398 -

Federal Emergency Management Agency Homeland Security Grant 97.067 E16-051 212,139 - 212,139 16,786 (fema), Department Of Homeland Security Program (via WA State Military Department)

Federal Emergency Management Agency Homeland Security Grant 97.067 E16-053 298,536 - 298,536 149,885 (fema), Department Of Homeland Security Program (via WA State Military Department)

Federal Emergency Management Agency Homeland Security Grant 97.067 E16-01243 55,527 - 55,527 55,527 (fema), Department Of Homeland Security Program (via Cify of Seattle - Police Department)

Federal Emergency Management Agency Homeland Security Grant 97.067 E17-059 230,220 - 230,220 95,561 (fema), Department Of Homeland Security Program (via WA State Military Department)

Federal Emergency Management Agency Homeland Security Grant 97.067 E17-090 271,711 - 271,711 2,749 (fema), Department Of Homeland Security Program (via WA State Military Department)

Total CFDA 97.067: 1,068,133 - 1,068,133 320,508 Total Federal Awards Expended: 27,991,647 17,112,479 45,104,126 14,483,374

NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

NOTE 1 - BASIS OF ACCOUNTING The Schedule of Expenditures of Federal Awards is prepared on the same basis of accounting as the County's financial statements. The County uses the modified accrual basis for its governmental fund types and the accrual basis of accounting for its proprietary fund types and fiduciary fund types.

NOTE 2 - PROGRAM COSTS The amounts shown as current year expenditures represent only the federal grant portion of the program costs. Entire program costs, including the County’s portion, are more than shown. Such expenditures are recognized following, as applicable, either the cost principles in the OMB Circular A-87, Cost Principles for State, Local, and Indian Tribal Governments, or the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement.

NOTE 3 – INDIRECT COST RATE For 2017, Snohomish County has elected to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance.

163 2017 Schedule of State Financial Assistance

Grantor Program Title Indentification Number Amount

1/2 County Prosecutor's Salary 2017 1/2 Prosecutor's Salary NA 83,488 Sub-total: 83,488 State Grant from Other Judicial Agencies AOC - Volunteer Guardian Ad Litem FY17 IAA17482 110,549 AOC - Court Interpreter Services IAA17554 1,560 AOC - Court Interpreter Services IAA18686 36,658 AOC - Ride-Along OT Reimbursement IAA18692 1,812 AOC - CASA Program Support FY18 IAA18097 103,725 AOC - Family and Juvenile Court Improvement Plan ICA17032 46,370 AOC - Family and Juvenile Court Improvement Plan ICA18035 41,543 Sub-total: 342,217 State Grant from Military Department SR530 Flooding and Mudslide Buyout D16-002 6,113 SR530 Disaster Relief DR14-205 17,316 2012 Jan Storm Assistance D12-058 23,216 Emergency Services Communication E17-040 18,921 Emergency Services Communication E18-051 3,428 Sub-total: 68,994 State Grant from Department of Agriculture Food Hub Feasibility Study K2107 44,902 Fair Improvements K2242 25,000 Fair Cumulative Reserve K1855 25,000 Sub-total: 94,902 State Grant from Recreation and Conservation Office Knotweed Control in NF & SF Stilly 15-1110 16,695 Whitehorse Trail Arlington-Trafton 06-1763D 4,096 Whitehorse Trail Design & Development 14-1796D 79,436 Snohomish Lead Entity 2015-2017 15-1405 26,041 Stillaguamish Lead Entity 2015-2017 15-1406 25,834 Heritage Capital Projects HCP 17-31 283,745 Local and Community Program 2016 16-93205-11 382,041 Hooven Bog Restoration 14-1441A 3,360 Lake Stickney Park Phase 1 14-1630D 234,424 Meadowdale Beach Park & Estuary Restoration Design 15-1056P 93,438 Wenberg Water Access Improvements 14-1627D 3,057 Wenberg Waterfront Improvements 14-1178D 5,242 Cicero Pond Outfall & Channel NA 26,986 Sub-total: 1,184,395 State Grant from Department of Ecology Coordinated Prevention W2RCPG-1517-SNCSWD-00002 356,853 Community Litter Cleanup W2RCLCP-1719-SnCSWD-00009 30,050 Community Litter Cleanup W2RCLCP-1517-SNCSWD-00014 31,517 Centennial Clean Water Program - Savvy Septic WQC-2015-SnCoPW-00183 39,228 SnoCo MRC - NW Straits SEANWS-2017-SnCoPW-00005 1,750 Sub-total: 459,398 Rural Arterial Program (RAP) Howard Creek Bridge #496 3113-01 335,820 Pilchuck River Bridge #581 3114-01 70,547 May Creek Bridge #559 3115-01 344,451 Sub-total: 750,818 County Arterial Preservation Program (CAPP) County Arterial Preservation Program (CAPP) NA 643,295 Sub-total: 643,295 State Grant from Transportation Improvement Board (TIB)

Seattle Hill Rd - 35th to 132nd 8-1-031(012)-1 605,286 Sub-total: 605,286 State Grant from Department of Commerce Financial Fraud and Identity Theft Task Force NA 59,674 Financial Fraud and Identity Theft Task Force NA 64,669 Community Services Block Grant (CSBG) S16-32100-226 38,466 Community Services Block Grant (CSBG) S18-32100-226 73,696 Consolidated Homelessness Grant (CHG) 16-46108-28 1,545,197 Consolidated Homelessness Grant (CHG) 17-46108-28 1,441,686

164 2017 Schedule of State Financial Assistance

Grantor Program Title Indentification Number Amount 15-17 PUD Matchmakers S15-94102-422 213,797 Matchmakers Program - Enhanced Weatherization S16-94102-422 102,193 17-19 State Matchmakers Weatherization Assistance S17-92401-422 32,533 2017 Energy Efficiency Grant 17-96608-265 217,547 Sub-total: 3,789,458 State Grant from Department of Social and Health Services CSEC Grant 1763-95118 20,190 Family Support State Share 2110-80559 1,064,492 Title IV-D Child Support State Share 2110-80559 139,634 DSHS 2017 Child Support Enforcement 1663-67354 18,311 DSHS-Juvenile Rehab Admin (JRA)-Consolidated Contract Block Grant FY17 1563-43128 714,961 DSHS-Juvenile Rehab Admin (JRA)-Consolidated Contract Block Grant FY18 1763-96324 615,236 DSHS - Juvenile Rehab Admin (JRA) CDMH Disposition Alternative 1563-43128 16,541 DSHS - WSART QA Specialist FY17 1563-42424 64,541 DSHS - WSART QA Specialist 1763-93831 62,536 DSHS - Juvenile Rehab Admin (JRA)-Evidence Based Expansion FY17 1563-42664 101,578 DSHS - Juvenile Rehab Admin (JRA)-Evidence Based Expansion FY18 1763-93778 113,077 DSHS - WSART Consultation FY17 1563-42415 7,683 DSHS - WSART Consult for County Juvenile Courts 1763-93730 7,267 DSHS - Senior Farmer's Market Nutrition Program 1669-68460 14,945 DSHS - SCSA 1669-68460 382,729 DSHS - State Family Caregiver Support 1669-68460 486,835 DSHS - Kinship Caregiver Support 1669-68460 30,008 DSHS - Senior Drug Education 1669-68460 7,607 DSHS - Title XIX/Chore 1669-68460 1,677,548 DSHS - Senior Farmer's Market Nutrition Program 1769-93495 51,862 DSHS - Kinship Caregiver Support 1769-93495 32,031 DSHS - Senior Drug Education 1769-93495 8,473 DSHS - SCSA 1769-93495 275,944 DSHS - State Family Caregiver Support 1769-93495 302,281 DSHS - Title XIX/Chore 1769-93495 1,723,437 Sub-total: 7,939,747 State Grant from Department of Health Airport Ops and Maintenance AIDV.ES00000608 1,270 Sub-total: 1,270 State Grant from Other State Agencies Early Childhood Education and Assistance Program 16-1125-07 10,262,021 17-18 Early Intervention Services 18-1021 228,762 NSBHO-Substance Abuse Block Grant North Sound BHO-Snohomish County 9,000 Sub-total: 10,499,783 Capital Contributions - State Grant from Recreation and Conservation Funding Board Smith Island Estuarine Restoration - Construction 09-1279R 4,406,307 Knotweed Control in NF & SF Stilly 15-1110 8,424 Hooven Bog Restoration 14-1441A 14-1441A 24,226 Sub-total: 4,438,957 Capital Contributions - State Grant from Department of Ecology Assessment/Restoration Lower Snohomish G1400649 271,752 Sub-total: 271,752 Capital Contributions - State Grant from Department of Transportation

State of Washington Department of Transportation GCB 2412 50,000 Sub-total: 50,000 Grand total: 31,223,760

NOTES TO THE SCHEDULE OF STATE FINANCIAL ASSISTANCE

NOTE 1 - BASIS OF ACCOUNTING The Schedule of State Awards is prepared on the same basis of accounting as the County's financial statements. The County uses the modified accrual basis for its governmental fund types and the accrual basis of accounting for its proprietary fund types and fiduciary fund types.

NOTE 2 - PROGRAM COSTS The amounts shown as current year expenditures represent only the state portion of the program costs. Actual program costs, including the County's portion, may be more than shown.

165