FINAL OFFICIAL STATEMENT, DATED JULY 14, 2011

NEW ISSUE: Book-Entry-Only RATINGS: Standard & Poor’s Corporation: SP-1+

In the opinion of Bond Counsel, based on existing statutes and court decisions and rendered in reliance upon and assuming the material accuracy of representations and continuing compliance by the Town with certain covenants and procedures relating to requirements of the Internal Revenue Code of 1986, as amended (the "Code,"), interest on the Notes is excludable from the gross income for federal income tax purposes and is not an item of tax preference for purposes of computing the federal alternative minimum tax imposed on individuals and corporations. Interest on the Notes is taken into account in determining adjusted current earnings for the purposes of computing the federal alternative minimum tax imposed on certain corporations. In the opinion of Bond Counsel, based on existing statutes, interest on the Notes is excludable from Connecticut taxable income for purposes of the Connecticut income tax on individuals, trusts and estates, and is excludable from amounts on which the net Connecticut minimum tax is based in the case of individuals, trusts and estates required to pay the federal alternative minimum tax. See “Tax Exemption” herein.

Town of Fairfield, Connecticut $41,380,000 General Obligation Bond Anticipation Notes Book-Entry-Only

Dated: July 22, 2011 Due: July 20, 2012 Rate: 2.00% CUSIP: 304243M54 Yield: 0.17%

The Notes were purchased by J.P. Morgan Securities through a competitive bid process.

Principal and interest on the Notes will be payable at maturity. The Notes are being offered for sale and will bear interest at such rate or rates per annum as are specified by the successful bidder or bidders in accordance with the Notice of Sale, dated July 6, 2011.

The Notes will be issued by means of a book-entry-only system and registered in the name of Cede & Co., as nominee for the Depository Trust Company (“DTC”), New York, New York. The Beneficial Owners of the Notes will not receive certificates representing their ownership interest in the Notes. Principal of, redemption premium, if any, and interest on the Notes will be payable by the Town or its agent to DTC or its nominee as registered owner of the Notes. Ownership of the Notes may be in principal amounts of $5,000 or any multiple thereof. So long as Cede & Co. is the Noteowner, as nominee for DTC, reference herein to the Noteowner or owners shall mean Cede & Co., aforesaid, and shall not mean the Beneficial Owners (as described herein) of the Notes. (See "Book-Entry-Only Transfer System" herein.)

The Notes will be general obligations of the Town of Fairfield, Connecticut, (the “Town”), and the Town will pledge its full faith and credit to pay the principal and interest on the Notes when due. (See “Security and Remedies” herein.)

The Notes are offered for delivery when, as and if issued, subject to the approving opinion of Pullman & Comley, LLC of Bridgeport, Connecticut. It is expected that delivery of the Notes in book-entry-only form will be made to DTC or its agent via “FAST” on or about July 22, 2011. The Registrar, Transfer Agent, Paying Agent, and Certifying Agent will be U.S. Bank National Association.

No dealer, broker, salesman or other person has been authorized by the Town to give any information or to make any representations not contained in this Official Statement or any supplement, which may be issued hereto, and if given or made, such other information or representations must not be relied upon as having been authorized. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy, nor any sale of the Notes by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. This Official Statement has been prepared only in connection with the initial offering and sale of the Notes and may not be reproduced or used in whole or in part for any other purpose. The information, estimates and expressions of opinion in this Official Statement are subject to change without notice. Neither the delivery of this Official Statement nor any sale of the Notes shall, under any circumstances, create any implication that there has been no material change in the affairs of the Town since the date of this Official Statement. The independent auditors for the Town are not passing upon and do not assume responsibility for the accuracy or completeness of the financial information presented in this Official Statement (other than matters expressly set forth in their opinion in Appendix A), and they make no representation that they have independently verified the same. Other than as to matters expressly set forth herein as the opinion of Bond Counsel, Bond Counsel is not passing on and does not assume any responsibility for the accuracy or adequacy of the statements made in this Official Statement and makes no representation that it has independently verified the same. TABLE OF CONTENTS Page Page I. Note Information IV. Tax Base Data Introduction…… ...... 1 Property Tax ...... 23 Financial Advisor…… ...... 1 Assessments ...... 23 The Notes…...... 1 Levy………...... 23 Description of the Notes...... 1 Net Taxable Grand List ...... 24 Redemption Provisions…...... 2 Ten Largest Taxpayers ...... 24 Authorization and Purpose...... 2 Tax Exempt Property...... 25 School Projects...... 2 Property Tax Levies and Collections...... 25 Book-Entry-Only Transfer System ...... 2 V. Debt Summary DTC Practices ...... 4 Principal Amount of Bonded Indebtedness...... 26 Replacement Notes...... 4 Long-Term Debt ...... 26 Security and Remedies...... 4 Short-Term Debt ...... 27 Qualification for Financial Institutions...... 5 Annual Bonded Debt Maturity Schedule...... 28 Availability of Continuing Disclosure Information...... 5 Overlapping/Underlying Debt ...... 29 Ratings……...... 5 Clean Water Fund Program ...... 29 Tax Exemption ...... 5 Debt Statement...... 30 Legal Opinion ...... 7 Current Debt Ratios ...... 30 Registrar, Transfer Agent, Paying Agent and Certifying Temporary Financing...... 31 Agent ...... 7 Authorized But Unissued Debt...... 32 II. The Issuer Statement of Statutory Debt Limitation...... 33 Description of the Issuer ...... 8 Principal Amount of Outstanding Debt...... 34 Form of Government...... 9 Ratio of Net Long-Term Debt to Valuation, Population and Organization Chart ...... 10 Income……...... 34 Principal Municipal Officials...... 10 Ratio of Annual General Fund Long-Term Debt Service Employee Relations ...... 11 Expenditures to Total General Fund Expenditures ...... 34 Full-Time Municipal Employees ...... 11 VI. Financial Administration General Government Employees by Department ...... 11 Fiscal Year…...... 35 Municipal Employee Bargaining Groups ...... 11 Basis of Accounting...... 35 Binding Arbitration ...... 12 Budget Procedure...... 35 Municipal Services...... 12 Audit……………...... 35 Educational System...... 15 Risk Management ...... 36 School Facilities ...... 17 Pensions……...... 36 School Enrollment...... 17 Other Post-Employment Benefits ...... 36 III. Economic and Demographic Information Investment of Operating Funds ...... 37 Population and Density ...... 18 General Fund Revenues and Expenditures...... 38 Age Distribution of the Population...... 18 Analysis of General Fund Equity ...... 38 Educational Attainment...... 18 VII. Legal and Other Information Income Levels ...... 19 Legal Matters…… ...... 39 Income Distribution...... 19 Litigation……...... 39 Major Employers...... 19 Documents Furnished at Delivery ...... 39 Employment by Industry...... 20 Concluding Statement...... 40 Percentage Unemployed...... 20 Land Use Summary...... 21 Appendix A - Excerpts from the Town's Comprehensive Housing Inventory...... 21 Annual Financial Report FYE 2010 Age Characteristics of Housing ...... 21 Appendix B - Form of Opinion of Bond Counsel Value of Owner-Occupied Housing...... 22 Appendix C - Form of Continuing Disclosure Agreement Building Permits...... 22 Appendix D - Notice of Sale and Bid Form

Note Issue Summary The information in this Note Issue Summary and the front cover page is qualified in its entirety by the detailed information and financial statements appearing elsewhere in this Official Statement. This Official Statement speaks only as of its date and the information herein is subject to change.

Date of Sale: Thursday, July 14, 2011 from 11:30 A.M. until 11:45 A.M. (E.D.T.). Location of Sale: Town of Fairfield, John J. Sullivan Independence Town Hall, 725 Old Post Road, Office of the First Selectman, Fairfield, Connecticut, 06824. Telephone: 203-256- 3030. Issuer: Town of Fairfield, Connecticut (the "Town”). Issue: $41,380,000 General Obligation Bond Anticipation Notes (the “Notes”). Dated Date: July 22, 2011 Principal Due: At maturity: July 20, 2012. Interest Due: At maturity: July 20, 2012. Purpose: The Note are being issued (i) to refund and finance temporarily a portion of bond anticipation notes maturing on July 22, 2011 that initially were issued for various school and general purpose projects and (ii) to finance temporarily various new general purpose and school projects. Redemption: The Notes are NOT subject to redemption prior to maturity. Security: The Notes will be general obligations of the Town and the Town will pledge its full faith and credit to the payment of principal of and interest on the Notes when due. Credit Rating: The Notes have been rated “SP-1+” by Standard & Poor’s Corporation. Bond Insurance: The Town has not purchased a credit enhancement facility. Basis of Award: Lowest Net Interest Cost (NIC). Tax Exemption: See “Tax Exemption” herein. Bank Qualification: The Notes shall NOT be designated by the Town as qualified tax-exempt obligations under the provisions of Section 265(b) of the Internal Revenue Code of 1986, as amended, for purposes of the deduction by financial institutions of interest expense allocable to the Notes. Continuing Disclosure: In accordance with the requirements of Rule 15c2-12(b)(5) promulgated by the Securities and Exchange Commission, the Town will agree to provide, or cause to be provided, and notices of material events with respect to the Notes pursuant to a Continuing Disclosure Agreement to be executed by the Town substantially in the form attached as Appendix E to this Official Statement. Registrar, Transfer Agent, Certifying Agent, and Paying Agent: U.S. Bank National Association, 225 Asylum Street, Hartford, Connecticut 06103. Financial Advisor: Phoenix Advisors, LLC of Milford, Connecticut will act as Financial Advisor. Phone: (203) 878-4945. Legal Opinion: Pullman & Comley, LLC, of Bridgeport, Connecticut will act as Bond Counsel. Delivery and Payment: It is expected that delivery of the Notes in book-entry-only form will be made on or about July 22, 2011 against payment in Federal Funds. Issuer Official: Questions concerning the Official Statement should be addressed to Mr. Paul H. Hiller, Jr., Fiscal Officer, John J. Sullivan Independence Town Hall, 725 Old Post Road, Office of the First Selectman, Fairfield, Connecticut, 06824. Telephone (203) 256-3069.

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I. Note Information Introduction This Official Statement, including the cover page and appendices, is provided for the purpose of presenting certain information relating to the Town of Fairfield, Connecticut (the “Town") in connection with the issuance and sale of $41,380,000 General Obligation Bond Anticipation Notes (the “Notes”) of the Town. This Official Statement is not to be construed as a contract or agreement between the Town and the purchasers or holders of any of the Notes. Any statement made in this Official Statement involving matters of opinion or estimates are not intended to be representations of fact, and no representation is made that any such opinion or estimate will be realized. No representation is made that past experience, as might be shown by financial or other information herein, will necessarily continue or be repeated in the future. Neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the Town since the date hereof. All quotations from and summaries and explanations of provisions of statutes, charters, or other laws and acts and proceedings of the Town contained herein do not purport to be complete and are qualified in their entirety by reference to the original official documents; and all references to the Notes and the proceedings of the Town relating thereto are qualified in their entirety by reference to the definitive forms of the Notes and such proceedings. The Town deems this Official Statement to be “final” for purposes of Securities and Exchange Commission Rule 15c-12(b)(1), but it is subject to revision or amendment. Bond Counsel is not passing on and does not assume any responsibility for the accuracy or adequacy of the statements made in this Official Statement other than matters expressly set forth as its opinion and makes no representation that is has independently verified the same. The independent auditors for the Town are not passing upon and do not assume responsibility for the accuracy or completeness of the financial information presented in this Official Statement (other than matters expressly set forth in their opinion in Appendix A), and they make no representation that they have independently verified the same. In accordance with the requirements of Rule 15c2-12(b)(1) promulgated by the Securities and Exchange Commission, the Town will agree to provide, or cause to be provided, notices of material events with respect to the Notes pursuant to a Continuing Disclosure Agreement to be executed substantially in the form of Appendix C to this Official Statement. The successful bidder’s obligation to purchase the Notes shall be conditioned upon its receiving, at or prior to the delivery of the Notes, an executed copy of the Continuing Disclosure Statement. U.S. Bank National Association will certify and act as the Registrar, Transfer Agent, Paying Agent and Certifying Agent for the Notes.

Financial Advisor Phoenix Advisors, LLC, of Milford, Connecticut has served as Financial Advisor to the Town with respect to the issuance of the Notes (the "Financial Advisor"). The information in this Official Statement has been prepared by the Town with the help of the Financial Advisor. The Financial Advisor is not obligated to undertake, and has not undertaken, either to make an independent verification of or to assume responsibility for the accuracy, completeness, or fairness of the information contained in the Official Statement and the appendices hereto. The Financial Advisor is an independent firm and is not engaged in the business of underwriting, trading or distributing municipal securities or other public securities.

The Notes Description of the Notes

The Notes will be dated July 22, 2011 and will be due and payable as to both principal and interest at maturity, July 20, 2012. The Notes will bear interest calculated on the basis of twelve 30-day months and a 360-day year at such rate or rates per annum as are specified by the successful bidder or bidders. A book-entry system will be employed evidencing ownership of the Notes in principal amounts of $5,000 or any multiple thereof, with transfers of ownership effected on the records of DTC, and its participants pursuant to rules and procedures established by DTC and its participants. See “Book-Entry Transfer System”. The Notes are not subject to redemption prior to maturity. The Certifying Agent, Paying Agent, Registrar and Transfer Agent for the Notes will be U.S. Bank National Association, 225 Asylum Street, Hartford, Connecticut 06103.

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Redemption Provisions The Notes are NOT subject to redemption prior to maturity. Authorization and Purpose The Notes are issued pursuant to Title 7, Chapter 109, Sections 7-369 et seq. of the Connecticut General Statutes, as amended, and appropriation and issuance of the Notes were authorized at various meetings of the Town’s Board of Selectman, Board of Finance and Representative Town Meeting (the “RTM”). Use of Proceeds The Notes are being issued (i) to refund and finance temporarily’ a portion of bond anticipation notes maturing on July 22, 2011 that initially were issued for various school and general purpose projects and (ii) to finance temporarily various new general purpose and school projects. The use of Note proceeds is summarized in the following table: Notes This Issue Due Notes Due: Project 7/22/2011 (Paydowns) New Money 7/20/2012 Capital Non-Recurring FYE ’07 ………$ 1,773,500 $ 1,000,000 $ - $ 773,500 Capital Non-Recurring FYE ’08 ……… 2,940,000 600,000 - 2,340,000 Capital Non-Recurring FYE ’09 ……… 4,985,000 304,850 - 4,680,150 Capital Non-Recurring FYE '10 ……… 3,100,000 - - 3,100,000 Capital Non-Recurring FYE '12……..… - - 2,005,000 2,005,000 Compost Facility Improvements ……… 200,000 100,000 - 100,000 Fairfield Woods Middle School……… 2,549,000 - 12,451,000 15,000,000 Flood Control Projects ……………… 405,000 200,000 - 205,000 Holland Hill Fuel Tanks……..………… - - 100,000 100,000 Penfield……………………………… - - 3,080,000 3,080,000 Road Paving…………………………… - - 1,900,000 1,900,000 Sherman Upgrades……..……………… - - 2,250,000 2,250,000 BOE LAN Switches……..…………… - - 450,000 450,000 Softball Field……..…………………… - - 350,000 350,000 Stratfield Elementary Construction.…… 2,000,000 - 2,901,350 4,901,350 Tomlinson Field ……………………… 162,500 17,500 - 145,000 Total ………………………………….. $18,115,000 $ 2,222,350 $ 25,487,350 $41,380,000

Book-Entry-Only Transfer System

The Depository Trust Company ("DTC"), New York, NY, will act as securities depository for the Notes. The Notes will be issued as fully-registered securities registered in the name of Cede & Co. (DTC's partnership nominee) or such other name as may be requested by an authorized representative of DTC. One-fully registered certificate will be issued for the Notes, in the aggregate principal amount of such maturity, and will be deposited with DTC.

DTC, the world's largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC's participants ("Direct Participants") deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants' accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ("DTCC"). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and

2 dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). DTC has Standard & Poor's highest rating: AAA. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com and www.dtc.org.

Purchases of the Notes under the DTC system must be made by or through Direct Participants, which will receive a credit for the Notes on DTC's records. The ownership interest of each actual purchaser of each Note ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owners entered into the transaction. Transfers of ownership interests in the Notes are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owner. Beneficial Owners will not receive certificates representing their ownership interests in the Notes, except in the event that use of the book-entry system for the Notes is discontinued.

To facilitate subsequent transfers, all Notes deposited by Direct Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co. or such other name as may be requested by an authorized representative of DTC. The deposit of Notes with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Notes; DTC's records reflect only the identity of the Direct Participants to whose accounts such Notes are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Redemption notices shall be sent to DTC. If less than all of the Notes within an issue are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent to vote with respect to the Notes unless authorized by a Direct Participant in accordance with DTC's MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the Issuer as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts the Notes are credited on the record date (identified in a listing attached to the Omnibus Proxy).

Principal and interest payments on, and redemption premium, if any, with respect to the Notes will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC's practice is to credit Direct Participants' accounts upon DTC's receipt of funds and corresponding detail information from the Issuer or Paying Agent, on payable date in accordance with their respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC, Paying Agent, or Issuer, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal and interest, and redemption premium, if any, to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Issuer or Paying Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

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

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

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

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DTC Practices The Issuer can make no assurances that DTC, Direct Participants, Indirect Participants or other nominees of the Beneficial Owners of the Notes will act in a manner described in this Official Statement. DTC is required to act according to rules and procedures established by DTC and its participants which are on file with the Securities and Exchange Commission. Replacement Notes In the event that: (a) DTC determines not to continue to act as securities depository for the Notes, and the Town fails to identify another qualified securities depository for the Notes to replace DTC; or (b) the Town determines to discontinue the book-entry system of evidence and transfer of ownership of the Notes, the Town will issue fully registered Note certificates directly to the Beneficial Owner. A Beneficial Owner of the Notes, upon registration of certificates held in such Beneficial Owner’s name, will become the registered owner of the Notes. Security and Remedies The Notes will be general obligations of the Town of Fairfield, Connecticut and the Town will pledge its full faith and credit to pay the principal of and interest on the Notes when due.

Unless paid from other sources, the Notes are payable from general property tax revenues. The Town has the power under Connecticut General Statutes to levy ad valorem taxes on all taxable property in the Town without limit as to rate or amount, except as to certain classified property such as certified forest land taxable at a limited rate and dwelling houses of qualified elderly persons of low income taxable at limited amounts. Under existing statutes the State of Connecticut is obligated to pay the Town the amount of tax revenue which the Town would have received except for the limitation upon its power to tax such dwelling houses or the Town may place a lien on the property for the amount of tax relief granted plus interest.

Payment of the Notes is not limited to property tax revenues or any other revenue source, but certain revenues of the Town may be restricted as to use and therefore may not be available to pay debt service on the Notes.

There are no statutory provisions for priorities in the payment of general obligations of the Town. There are no statutory provisions for a lien on any portion of the tax levy or other revenues to secure the Notes, or judgments thereon, in priority to other claims.

The Town is subject to suit on its general obligation debt (hereafter “debt”) and a court of competent jurisdiction has power in appropriate proceedings to render a judgment against the Town. Courts of competent jurisdiction also have power in appropriate proceedings to order a payment of a judgment on such debt from funds lawfully available therefore or, in the absence thereof, to order the Town to take all lawful action to obtain the same, including the raising of the required amount in the next annual tax levy. In exercising their discretion as to whether to enter such an order, the courts may take into account all relevant factors including the current operating needs of the Town and the availability and adequacy of other remedies.

Enforcement of a claim for payment of principal of or interest on such debt would also be subject to the applicable provisions of Federal bankruptcy laws as well as other bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’ rights heretofore or, hereafter enacted and to the exercise of judicial discretion. Section 7-566 of the Connecticut General Statutes, amended in 1993, provides that no Connecticut municipality shall file a petition in bankruptcy without the express prior written consent of the Governor. This prohibition applies to any town, city, borough, metropolitan district or any other political subdivision of the State having the power to levy taxes and issue bonds or other obligations.

THE TOWN OF FAIRFIELD HAS NEVER DEFAULTED IN THE PAYMENT OF PRINCIPAL OR INTEREST ON ITS BONDS

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Qualification for Financial Institutions

The Notes shall NOT be designated by the Town as qualified tax-exempt obligations under the provisions of Section 265(b) of the Internal Revenue Code of 1986, as amended, for purposes of the deduction by financial institutions for certain interest expense allocable to the Notes.

Availability of Continuing Disclosure Information

The Town prepares, in accordance with State law, annual independent audited financial statements and files an annual report with the State of Connecticut’s Office of Policy and Management within six months of the end of its fiscal year. In accordance with the requirements of Rule 15c2-12(b)(5) promulgated by the Securities and Exchange Commission (the “Rule”), the Town will agree to provide, or cause to be provided, in accordance with the Rule, notices of material events with respect to the Notes pursuant to a Continuing Disclosure Agreement to be executed by the Town substantially in the form attached as Appendix C. The Town has previously undertaken in continuing disclosure agreements entered into for the benefit of holders of certain of its general obligation bonds to provide certain annual financial information, operating data and event notices pursuant to Rule 15c2-12(b)(5). To date, the Town has not failed to meet any of its undertakings under such agreements, except for a failure to file with the Municipal Securities Rulemaking Board's EMMA system the Fiscal Year 2009 and Fiscal Year 2010 annual financial statements until March 21, 2011. A notice of such failure to file was filed with EMMA on March 21, 2011. The Town has since put in place procedures to coordinate the timely filing of its annual financial statements.

Ratings

The Town applied to Standard & Poor’s Corporation for a credit rating on the Notes, furnishing the credit rating agency certain information and materials, some of which may not have been included in this Official Statement. The rating reflects only the view of the respective credit rating agency and will be subject to revision or withdrawal, which could affect the market price of the Notes. The credit rating agency should be contacted directly for the ratings on the Notes and the explanation of such ratings. No application was made to any other credit rating agency for the purpose of obtaining ratings on outstanding securities of the Town. The credit ratings reflect only the view of the respective rating agency, and an explanation of the significance of a rating may be obtained only from a credit rating agency. Generally, each credit rating agency’s rating is based upon information and materials that it gathers, and upon its own investigations, studies and assumptions. There can be no assurance that a credit rating will continue for any given period of time or that it will not be lowered or withdrawn entirely by a credit rating agency if, in its judgment, circumstances so warrant. Any such downward change in or withdrawal of a credit rating may have an adverse effect on the marketability or market price of the Town’s outstanding securities. Moody’s Investors Service, Inc. assigned a credit rating of “Aaa,” Standard & Poor’s Corporation assigned a credit rating of “AAA,” and Fitch Ratings assigned a credit rating of “AAA” on the Town’s General Obligation Bonds, Issue of 2010. Each credit rating agency concurrently affirmed the same respective rating for the Town’s outstanding long term debt. Standard & Poor’s Corporation has assigned a credit rating of “SP-1+” to this Bond Anticipation Note issue. Concurrently, Standard & Poor’s Corporation reaffirmed the Town’s outstanding long-term debt rating of “AAA”.

Tax Exemption Federal Taxes. In the opinion of Pullman & Comley, LLC Bond Counsel to the Town, under existing law, interest on the Notes (a) is excludable from gross income for federal income tax purposes and (b) is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however, such interest is taken into account in determining adjusted current earnings for purposes of computing the federal alternative minimum tax imposed on certain corporations.

Bond Counsel’s opinion with respect to the Notes will be rendered in reliance upon and assuming the accuracy of and continuing compliance by the Town with its representations and covenants relating to certain requirements of the Internal Revenue Code of 1986, as amended (the “Code”). The Code and regulations promulgated thereunder establish certain requirements which must be satisfied at and subsequent to the issuance of the Notes in order that interest on the 5

Notes be and remain excludable from gross income for federal income tax purposes. Failure to comply with such requirements may cause interest on the Notes to be included in gross income for federal income tax purposes retroactively to the date of issuance of the Notes irrespective of the date on which such noncompliance occurs. In the Tax Compliance Agreement, which will be delivered concurrently with the issuance of the Notes, the Town will covenant to comply with certain provisions of the Code and will make certain representations designed to assure compliance with such requirements of the Code including, but not limited to, investment restrictions, periodic payments of arbitrage profits to the United States, requirements regarding the proper use of Bond and Note proceeds and certain other matters. The opinion of Bond Counsel delivered on the date of issuance of the Notes is conditioned upon compliance by the Town with such requirements.

No other opinion is expressed by Bond Counsel regarding the federal tax consequences of the ownership of, or the receipt or accrual of interest on, the Notes.

Original Issue Premium. An amount equal to the excess of the purchase price of a Note over its stated redemption price at maturity constitutes premium on such Note. A purchaser of such a Note must amortize any premium over the term of such Note using constant yield principles, based on such Note’s yield to maturity. As premium is amortized, the purchaser’s basis in such Note and the amount of tax-exempt interest received will be reduced by the amount of amortizable premium properly allocable to such purchaser. This will result in an increase in the gain (or decrease in the loss) to be recognized for federal income tax purposes on sale or disposition of such Note prior to its maturity. Even though the purchaser’s basis is reduced, no federal income tax deduction is allowed. Purchasers of any Note at a premium, whether at the time of initial issuance or subsequent thereto, should consult their tax advisors with respect to the determination and treatment of premium for federal income tax purposes, and with respect to state and local tax consequences of owning such Notes.

Other Federal Tax Matters. Prospective purchasers of the Notes should be aware that ownership of the Notes may result in collateral federal income tax consequences to certain taxpayers, including, without limitation, financial institutions, certain insurance companies, recipients of Social Security or Railroad Retirement benefits, certain S corporations, foreign corporations subject to the branch profits tax, taxpayers eligible for the earned income credit, and taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry tax-exempt obligations. Bond Counsel does not express any opinion regarding such collateral tax consequences. Prospective purchasers of the Notes should consult their tax advisors regarding collateral federal income tax consequences.

Legislation affecting the exclusion from gross income of interest on bonds or notes is regularly under consideration by the United States Congress. There can be no assurance that legislation enacted or proposed after the date of issuance of the Notes will not have an adverse effect upon the tax-exempt status or the market price of the Notes.

State Taxes. In the opinion of Bond Counsel, under existing statutes, interest on the Notes is excludable from Connecticut taxable income for purposes of the Connecticut income tax on individuals, trusts and estates and is excludable from amounts on which the net Connecticut minimum tax is based in the case of individuals, trusts and estates required to pay the federal alternative minimum tax.

Interest on the Notes is included in gross income for purposes of the Connecticut corporation business tax.

Owners of the Notes should consult their own tax advisors with respect to the determination for state and local income tax purposes of original issue discount or original issue premium accrued upon sale or redemption thereof, and with respect to the state and local tax consequences of owning or disposing of such Notes.

Owners of the Notes should consult their tax advisors with respect to other applicable state and local tax consequences of ownership of the Notes and the disposition thereof.

Miscellaneous. Tax legislation, administrative actions taken by tax authorities and court decisions, whether at the federal or state level, may adversely affect the tax-exempt status of interest on the Notes under federal or state law and could affect the market price for, or the marketability of, the Notes. Prospective purchasers of the Notes should consult their own tax advisers regarding the foregoing matters.

General. The opinion of Bond Counsel is rendered as of its date, and Bond Counsel assumes no obligation to update or supplement their opinions to reflect any facts or circumstances that may come to their attention or any

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changes in law that may occur after the date of their opinion. Bond Counsel’s opinions are based on existing law, which is subject to change. Such opinions are further based on factual representations made to Bond Counsel as of the date of issuance. Moreover, Bond Counsel’s opinions are not a guarantee of a particular result, and are not binding on the IRS or the courts; rather, such opinions represent Bond Counsel’s professional judgment based on its review of existing law, and in reliance on the representations and covenants that it deems relevant to such opinions.

The discussion above does not purport to deal with all aspects of federal or state or local taxation that may be relevant to a particular owner of the Notes. Prospective owners of the Notes, particularly those who may be subject to special rules, are advised to consult their own tax advisors regarding the federal, state and local tax consequences of owning and disposing of the Notes.

Legal Opinion

The legal opinion for the Notes will be rendered by Pullman & Comley, LLC in substantially the form set forth in Appendix B to this Official Statement.

Registrar, Transfer Agent, Paying Agent and Certifying Agent

The Registrar, Transfer Agent, Paying Agent and Certifying Agent for the Notes will be U.S. Bank National Association, Goodwin Square, 23rd Floor, 225 Asylum Street, Hartford, Connecticut 06103.

7 I/. The Issuer

CONNECTICUT

Description of the Issuer

Settled in 1639 as the ninth town in Connecticut, the Town of Fairfield was included in the Connecticut Colony in 1685. Covering a total area of 32.1 square miles at an elevation of 15 feet, the Town is located geographically in Fairfield County on Long Island Sound in the southwestern part of Connecticut. The Town is bordered by Westport to the west; Bridgeport to the east; and Weston, Easton and Trumbull to the north. Fairfield is 50 miles northeast from New York City; 5 1 miles southwest from Hartford; 106 miles southwest frorn Providence; and 141 miles southwest from Boston. The Southport area of Fairfield (settled in 1639) has been designated as an historic district for its harbor, churches, public buildings, and the homesteads of some of the Town's first families.

Fairfield is readily accessible by many major highways: frorn the east and west by Interstate 95 (the Connecticut Turnpike), the Merritt Parkway (Route l5), and U.S. Route 1 and from the north by State Routes 58 and 59. Access is readily available via 1-95 to State Route 7 in Norwalk, and State Routes 8 and 25 in Bridgeport. These highways are well covered by motor truck service, as numerous interstate operators maintain local terminal facilities in the Fairfield area, Fairfield has two train stations (the Fairfield Station and the Southport Station) providing passenger service on the Metro-Eorth Commuter Railroad's New Haven Line with service south to Nonvalk. Stamford and New York City and north to Bridgeport and New Haven, as well as linkage to Amtrak via connections in Stamford and Bridgeport. The Greater Bridgeport Transit Authority provides bus service to the community, and air transportation is available at Sikorsky Airport in nearby Stratford, Connecticut and the -Metropolitan New York airports (LaGuardia, Kennedy and Newark). An automobile and passenger ferry service frorn Bridgeport to Port Jefferson, New York is available year- round, and a limousine service is available only a few minutes from Fairfield's downtown center. Fairfield is primarily a residential community of homes in the middle and upper-price range, with significant commercial developments. The Town is located in one of the highest per capita income areas of the United States, and a significant number of the Town's residents are executives, professionals, technicians and managers employed in New York City and at the industrial and corporate headquarters of nationally-known firms located in Town and in surrounding Fairfield County communities. Fairfield is part of the Bridgeport Labor Market Area, the Greater Bridgeport Economic Development Region, and the Greater Bridgeport Planning Area.

The Town utilizes an adopted Plan of Development to maintain its suburban character. Zoning regulations have been in effect since the 1950’s, with numerous modifications. Approximately 80% of the Town’s area is utilized for residential use. The Town has many well-planned shopping centers and professional office buildings, especially along the Post Road (U.S. Route 1) in the southern part of Town and along Black Rock Turnpike (State Route 58) in the northern part. The General Electric Company located its corporate headquarters in Fairfield in 1974, and is the Town’s largest taxpayer. The Fairfield Chamber of Commerce, Inc., founded in 1946 by a handful of business owners, currently has more than 500 retail, service and professional members, and the Town is a member of the Coastal Fairfield County Convention and Visitor Bureau. Fairfield University and Sacred Heart University are located within the Town, educating over a total of 11,000 students, and other institutions of higher learning are located within commuting distance. The Town has approximately 1,500 acres of parks and open space, with 1,000 acres dedicated for open space and 500 acres dedicated to organized active recreation. The Town operates two municipal golf courses, five public beaches along Long Island Sound, one public beach at Lake Mohegan, two marinas with 850 slips, and numerous ball fields and playgrounds. Fairfield boasts three libraries with extensive book collections and active cultural calendars. The Fairfield Public Library includes the Main Library on the Old Post Road, and the Fairfield Woods branch. Southport's independent Pequot Library shares a computer system with the Town’s library. The Connecticut Audubon Society’s Nature Center/Sanctuary is located within Town, and the Fairfield Arts Council is an active not-for-profit organization established to foster cultural development and increase public support for the arts in Fairfield. Chartered in 1903, the Fairfield Historical Society, a not-for-profit, privately supported, educational institution, operates a newly-constructed Museum and History Center, and the Ogden House & Gardens, an accurately restored and furnished 18th-century farmhouse. Residents participate in numerous non-profit endeavors, including Fairfield Community Services, Meals-on-Wheels, Southport Woman’s Club, Stewart B. McKinney Foundation, United Home Care, Welcome Wagon, and the Fairfield Community Theater Foundation.

Fairfield residents enjoy proximity to three major hospitals: St. Vincent’s Medical Center in Bridgeport, Bridgeport Hospital, and Norwalk Hospital. It is also served by all public utilities: The United Illuminating Company provides electric service; Southern Connecticut Gas Company provides gas service; the Aquarion Water Company provides water service; and Cablevision Systems of Southern CT (“Cablevision”) provides cable access. Fairfield residents enjoy broadcasting by WSHU, a part of the National Public Radio Group, and they can subscribe to a local newspaper published every Wednesday and Friday, The Fairfield Citizen-News, as well as a weekly newspaper, The Fairfield Minuteman. Local news coverage is also provided by a daily Bridgeport newspaper, The Connecticut Post, major New York newspapers, including The New York Times and The Wall Street Journal, as well as Cablevision’s Channel 12. Form of Government Pursuant to the Town Charter, the Town of Fairfield’s form of government consists of a Representative Town Meeting (“RTM”) with a Board of Selectmen and Board of Finance. The Board of Selectmen consists of a First Selectman and two Selectmen each elected to four-year terms; the RTM has 50 members elected to two-year terms; and the Board of Finance has nine members elected to staggered six-year terms (three members are elected every two years). The First Selectman is the Chief Executive Officer of the Town, responsible for supervising and coordinating all matters pertaining to the delivery of the Town’s programs and services. The legislative function is performed by the RTM, a partisan body with 50 members representing 10 separate voting districts with five members elected from each district, which approves the annual budget, and must approve supplemental appropriations and bond authorizations exceeding certain amounts.

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Principal Municipal Officials

Manner of Office Name Selection Term of Office First Selectman ...... Michael C. Tetreau Elected June 2011-November 2011 Selectman ...... Sherri A. Steeneck Appointed 1 June 2008-November 2011 Selectman ...... James Walsh Appointed 1 May 2010-November 2011 Town Clerk...... Betsy Browne Elected November 2007-2011 Board of Finance, Chairman.... Thomas Flynn Elected November 2005-2011 RTM, Moderator ...... Jeff Steele Elected November 2009-2011 Fiscal Officer...... Paul H. Hiller, Jr. Appointed Indefinite Treasurer...... Sheryl A. Shaughnessy Appointed Indefinite 1 These are elected positions. In both cases, the Selectmen passed away during their term. As a result, the vacancy was filled by an appointment by a vote of the Board of Selectmen.

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Employee Relations The Town currently employs 1,953 full-time personnel for general government and the Board of Education as shown by the table below:

Full-Time Municipal Employees Last Five Fiscal Years

2011 2010 2009 2008 2007 General Government ...... 466 464 475 494 496 Board of Education1...... 1,487 1,484 1,481 1,406 1,325 Total ...... 1,953 1,948 1,956 1,900 1,821

1 Based upon full-time equivalents. Source: Town of Fairfield, Finance Department; Town of Fairfield, Board of Education.

General Government Employees by Department As of May 15, 2011

Full-Time Department Permanent Administration...... 80 Fire ...... 98 Health & Social Services.. 37 Library...... 31 Parks & Recreation ...... 13 Police...... 113 Public Works...... 94 Total ...... 466

Source: Town of Fairfield, Finance Department.

Municipal Employee Bargaining Groups 1 As of May 15, 2011 Current Contract Positions Expiration Occupation Board of Education Covered Date Teachers ...... Fairfield Education Association...... 970 6/30/2012 Administrators...... Fairfield School Administrators Association ...... 39 6/30/2012 Paraprofessionals.. Fairfield Educational Paraprofessionals Association Civil 233 Service Employees Affiliates, Inc...... 6/30/2013 Secretaries ...... Fairfield Association of Educational Secretaries ...... 81 6/30/2010 2 Custodians & 94 Maintenance ...... Local 1779, Council #4, AFSCME, AFL-CIO ...... 6/30/2012 Information Fairfield informational Technicians Association, AFSCME, Technology…..... AFL-CIO…………………………………………………… 20 6/30/2011 Special Education Fairfield Special Education Trainers Association, Trainers..……… AFSCME, AFL-CIO……………………………………….. 18 6/30/2011 Non-Bargaining Employees...... 32 -- Total Board of Education...... 1,487 1 Includes two new employee bargaining groups, the Special Educational Trainers, Council of ASFCME, AFL-CIO, and Information Technicians, Council of ASFCME, AFL-CIO, which were recently formed but are in the process of collectively bargaining with the Board of Education. 2 Contract is currently under negotiation. Source: Town of Fairfield, Board of Education.

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Municipal Employee Bargaining Groups (continued) As of May 15, 2011

Current

Contract Positions Expiration Occupation General Government Covered Date 1 Police...... Connecticut Organization for Public Safety, Local 550, Connecticut Independent Labor Union ...... 101 6/30/2010 2 Public Works...... Local 67, Connecticut Independent Labor Union ...... 85 6/30/2010 2 Firefighters ...... Local 1426, International Association of Firefighters, AFL – CIO ...... 94 6/30/2010 2 Town Hall ...... United Public Service Employees Union, Local 222 ...... 88 6/30/2013 Supervisors...... Professional and Technical Employees, AFSCME, AFL- CIO...... 39 6/30/2010 2 Communications... Communications Workers of America, Local 1303...... 13 6/30/2010 2 Nurses...... Fairfield Public Health Nurses, Unit 34, Federation of Educational and Professional Employees, Connecticut State Federation of Teachers, American Federation of Teachers ...... 32 6/30/2010 2 Non-Bargaining Employees ...... 14

Total General Government ...... 466

Total Board of Education and General Government ...... 1,953

1 New contracts projected to expire June 30, 2013.

2 Contract is currently under negotiation.

Source: Town of Fairfield, Finance Department.

Binding Arbitration Sections 7-473c and 7-474 of the Connecticut General Statutes, as amended, provide a procedure for binding arbitration of collective bargaining agreements between municipal employers and organizations representing municipal employees, except certified teachers and administrative personnel. Section 10-153f of the Connecticut General Statutes, as amended, provides a procedure for binding arbitration of collective bargaining agreements between local or regional boards of education and the exclusive representative of a bargaining unit of teachers or administrators.

Municipal Services

The Town provides the following public services as authorized under the Town Charter: general administrative services; public safety (police and fire); public works; health and social services; and culture, recreation and conservation.

General Administrative Services: Administrative services are provided by the following departments: the First Selectman’s Office, Town Planning & Zoning, Conservation Commission, Human Resources and Economic Development. This division offers administrative support services to the general public, and the Board of Selectman, RTM and most departments.

The Board of Finance has jurisdiction over the Finance Department, Purchasing Department, Assessor’s Office, Tax Department and Information Systems. Financial personnel within each department report to the Fiscal Officer, who is responsible for the overall supervision of the Town’s financial management.

Public Safety: This municipal service consists of five departments: Police; Fire; Animal Control; Emergency Control Center; and Emergency Management. This division is responsible for the security and safety of the community.

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Police Department. The Police Department has 108 sworn officers consisting of a Chief, four Captains, seven Lieutenants, 12 Sergeants, 12 Detectives and 70 Patrolmen, and two officers are in the Animal Control Unit. The department is divided into four divisions: Administration, Investigations, Patrol, and Special Service (Special Police, Animal Control, Accident Investigations, Motorcycle Unit, Marine Division, Dive Team and Emergency Communications Center). The patrol division is the largest division in the Fairfield Police Department, consisting of uniformed officers responsible for performing a multitude of tasks, including: responding to calls for service (criminal complaints, motor vehicle accidents, recovery of stolen property, public assistance calls, and calls for medical assistance); enforcing motor vehicle laws; working with the public to prevent crimes; apprehending criminals and wanted persons; writing reports for their activities; and patrolling neighborhoods, parks and streets. The Fairfield Police Commission, consisting of seven civilian commissioners, has general management supervision of the department.

Fire Department. The Fire Department has 94 sworn personnel, consisting of a Fire Chief, a Deputy Chief, six Assistant Chiefs, a Fire Marshal, an Inspector, 20 Lieutenants, and 64 Firefighters, as well as two civilian personnel. The Emergency Control Center has 15 dispatchers. The Board of Fire Commissioners, consisting of seven commissioners, acts as the policy-making civilian board. The department operates from five firehouses located in various sections of the Town, manned by five pumpers and two aerial ladder trucks. Two pumpers and one aerial ladder truck are in reserve; in addition, three rescue trucks, three station wagons, and four sedans are used by the department.

Public Works: The Department of Public Works manages the following public functions: engineering, public buildings, public works, highways and drainage systems, parks and marinas, wastewater collection and wastewater treatment. The department also operates the South Benson Boat Marina, with a capacity of approximately 750 boats, and the Southport Harbor Marina, which has a capacity of approximately 100 boats.

Engineering Department. This department prepares designs, studies, plans and specifications for road and drainage projects, outdoor recreational facilities, flood control projects, parking areas, etc. They also review plans and perform inspections for new roads, bridges, culverts and grading plans for new subdivisions as well as conduct surveys and provide information to interested citizens. They are staffed by seven employees, managed by the Town Engineer.

Building Department. This department, which has seven employees managed by the Building Official, ensures that building construction and modification conform with the Town’s and the State’s building codes to protect the public health, safety and general welfare in regards to the construction and occupancy of buildings and structures. The department issues building permits, performs all necessary inspections and issues a certificate of occupancy with final approval.

Water Pollution Control. This department operates a treatment plant with a designed capacity of 9,000,000 gallons per day, with secondary treatment using activated sludge process. The plant, seven pump stations and approximately 170 miles of sewer lines are maintained by a staff of 23 employees, supervised by a registered engineer. The only areas of the Town not receiving service are located in 1- and 2-acre zoning with very adequate leeching fields.

With over 100 pieces of construction equipment, dump trucks, pick-up trucks and automobiles at its disposal, the remaining responsibilities of the Department of Public Works consist of maintaining streets, storm drains, trees, bridges, automotive equipment and public buildings handled by a staff of 79 persons reporting to a Superintendent of Operations. The entire department is administered by a staff of 5 people.

Health and Social Services: The Health Department, the Department of Social Services and the Human Services Department provide health and social services to the Town’s residents.

Health Department. The primary mission of the Health Department is to protect and improve the physical, mental, and environmental health of the Fairfield community by providing both oversight and direct services. With a staff of 33 full-time and 11 part-time employees, the Health Department’s administrative and regulatory health services include disease and injury prevention; environmental protection; health monitoring; enforcement of health and safety codes; health promotion; and health care services. The department also provides community and public health nursing and services.

Department of Social Services. The Department of Social Services offers the social services to residents of the Town, regardless of income, including crisis intervention, short-term counseling, assistance with screening and applications for other agencies, emergency assistance, eviction and ejectment, receivership and processing, child

13 protective service referrals, and consultation for child day care facilities personnel. The department has one member, as well as consultants retained on a part-time contractual basis.

Human Services Department. The Human Services Department is responsible for ensuring that the programs, services and facilities offered by the Town are available and accessible to all qualified residents with disabilities. The department provides information, outreach, advocacy and referral services to elderly and disabled Town residents.

Culture, Recreation and Conservation: Regulated by the Golf Commission and the Parks and Recreation Commission, the Town of Fairfield has approximately 500 acres of land utilized for organized active recreation.

Golf Commission. The Golf Commission oversees the operation of two municipal golf courses: H. Smith Richardson Golf Course, an 18-hole regulation course located in the northern area of the Town, and South Pine Creek Golf Course, a 9-hole par 3 course located near Long Island Sound. Five other golf courses are located physically within the Town.

Parks & Recreation Department. The Parks & Recreation Department is responsible for the maintenance of the Town’s parks, ball fields and recreating facilities, as well as providing recreational programs. The department is the caretaker of five public beaches along Long Island Sound (Jennings, Penfield, Sasco, South Pine Creek and Southport Beach), and a freshwater beach located at the 150-acre park known as Lake Mohegan.

The Parks & Recreation Department is responsible for maintenance of 42 tennis courts, 26 baseball and softball fields, 21 playgrounds, 5 play lots, 3 soccer fields, 3 running tracks and 13 gymnasiums. These facilities are utilized for baseball, softball, soccer, basketball, tennis, teen and adult dances, summer teen theater, teen centers, and various indoor activities by residents and groups.

Conservation Department. The Conservation Department manages or administers over 1,100 acres of Town- owned upland forest, lakes, rivers, salt marsh, wetlands and meadows throughout inland and coastal areas of the Town through an Open Space Program. These passive recreational parcels provide opportunities for uses such as hiking, fishing, nature study, picnicking, camping, horseback riding and other outdoor activities. In addition, they enhance and conserve natural resources, protect fish and wildlife habitats, and contribute significantly to the character of the Town.

Solid Waste Collection: Solid waste collection in Fairfield is collected by private firms who have direct contracts with residents.

Fairfield is one of twelve municipalities that has entered into a Municipal Service Agreement (“MSA”) with the Connecticut Resource Recovery Authority (the “Authority”) for the disposal of solid waste through the Greater Bridgeport Resource Recovery System (the “System”). Each municipality which has signed such MSA (a “Participating Municipality”) has agreed to deliver or cause to be delivered to the System all “Acceptable Waste,” as defined therein, generated within its boundaries. The facility for the System (the “Facility”) is located in the City of Bridgeport, Connecticut and was designed and constructed and is operated by Bridgeport Resco Company, L.P. (the “Company”). The Facility began commercial operation in July 1988 and is designed to process up to 2,250 tons of solid waste per day. Each Participating Municipality has further agreed to deliver annually its Minimum Tonnage Guarantee, as defined in the MSA, to the System.

For fiscal year ending June 30, 2011, the Authority billed each Participating Municipality a fixed charge of $64.16 per ton of municipal solid waste actually delivered by or on behalf of each Participating Municipality. For fiscal year ending June 30, 2012, the fixed charge is $65.11 per ton. Each Participating Municipality has agreed to pay Municipal Disposal Fees to the Authority for the acceptance and processing and/or disposing of Acceptable Waste. The Municipal Disposal Fees, which are payable on a monthly basis, include (i) disposal fees of the Authority to the Company under a Solid Waste Disposal Agreement, (ii) an Authority Administrative Fee. The obligation of the Participating Municipalities to pay Municipal Disposal Fees, so long as the Authority meets its obligation to accept and dispose of Acceptable Waste, is absolute and unconditional and shall not be subject to any abatement, reduction, set-off, counterclaim, recoupment, defense (other than payment itself) or other right which the Participating Municipality may have against the Authority or any other person for any reason whatsoever. If any Participating Municipality shall default in the payment of any amounts for which it is responsible and such default continues for more than 60 days, the other Participating Municipalities shall pay their share of the amounts unpaid by

14 the non-paying Participating Municipality and shall be entitled to full reimbursement upon the Authority collecting such delinquent amounts. The MSAs contain Minimum Tonnage Guarantees for each Participating Municipality. The Town of Fairfield’s Minimum Tonnage Guarantee is 44,000 tons. The aggregate Minimum Tonnage Guarantee by all the Participating Municipalities is 265,000 tons. Fairfield is also part of an Inter-Community Agreement dated September 15, 1989 establishing a regional recycling program. The Southwest Connecticut Regional Recycling Operating Committee (SWEROC) was established to implement the regional recycling program to meet the State of Connecticut mandated program for recycling, per Sections 22a-241-22a-241i of the Connecticut General Statutes. Fairfield is one of seventeen “Contracting Communities” participating in the SWEROC recycling program. The Town is committed to supply recyclables annually consisting of: food and beverage containers made of glass, metal and certain plastics, and newspapers. Other defined residential recyclables are cardboard, waste oil, storage batteries and scrap metal. The Town has flow-control responsibilities for recyclables from the residential sector, and its role is to receive recyclables from residential sources and transfer it to a regional recycling processing facility located in Stratford, Connecticut. Non-residential generators can deliver recyclables to independent processing facilities other than SWEROC but must report to the Town the types and amounts of recyclable materials delivered to non-SWEROC processing facilities. A municipal ordinance has been adopted by the Town to comply with the requirements of the State of Connecticut legislation. From July 1, 2009 through June 30, 2010, the Town’s recycling program retrieved approximately 23,092 tons of recyclables from the waste stream.

Educational System

The Board of Education, consisting of nine elected members, is responsible for the operation of the Fairfield School District (the “District”). 1 Board of Education Name Term John Mitola, Chairman ...... November 2005-2011 Pamela Iacone, Vice Chairman...... November 2005-2011 Susan Brand,...... November 2007-2013 Catherine Albin ...... November 2005-2011 Paul Fattibene ...... November 2009-2015 Susan Dow ...... November 2007-2011 Perry Liu...... November 2009-2015 Tim Kery ...... November 2009-2015 Stacey Zahn, Secretary ...... November 2007-2011 1 On November 7, 2006, the Town’s electors voted to approve revisions to the Town Charter, effective November 27, 2006, including revising the term of the nine members of the Board of Education from six years to four years with a transition period during which two members would be elected during the townwide election on November 6, 2007 to four year terms (2007 – 2011) and one member would be elected for a six year term (2007 – 2013). On November 6, 2007, Susan Brand was elected to the six-year term, and Susan Dow and Stacey Zahn were elected to the two four-year terms. This transition ends following the townwide election in November 2013.

The District consists of 11 schools for students in grades Kindergarten through 5; three middle schools for students in grades 6 through 8; and two high schools for students in grades 9 through 12. The School District also operates a pre-school program at McKinley Elementary School; an Early Childhood Center for pre-school children with special needs; a Program for Alternative Learning and COOP Program for high school students; and a Continuing Education Program for adults.

School Projects The Town’s system-wide improvement program for its school facilities, estimated to cost approximately $200,000,000, is complete. Each of the projects was overwhelmingly approved by the RTM, including the construction of two new elementary schools and a new middle school, as well as substantial renovations to a high school, the conversion of a middle school into a second high school and the renovation of a third middle school. The Town has opened the McKinley Elementary School and the Burr Elementary School, as well as Ludlowe Middle School, and has

15 converted a middle school into a second high school, Fairfield Ludlowe High School. The expansion and renovation of Fairfield Warde High School and Tomlinson Middle School is complete.

Each of the school projects was opened substantially on schedule and completed at an aggregate expense less than the total amount initially authorized for such projects. As result of such savings, and the fact that the Town has recently increased its estimate of the percentage of State assistance that it will receive for school building projects, the Town’s bonding requirements for the program decreased from what was originally anticipated.

Historically, the State of Connecticut has assisted its towns in the funding of public school building projects. This aid has taken different forms over the years, and the amount of assistance has been affected not only by the characteristics of a town but also the nature of the improvements. Wealthier towns typically have received assistance at a lower rate than less affluent towns, and instructional improvements have been reimbursed at higher rate than recreational improvements.

Debt Reimbursement System. For school building projects approved prior to July 1, 1996, the State assistance took the form of debt reimbursement. Under the pre-1996 State program, a town finances the total cost of the school building project and the State reimburses the town for a portion of the debt service on the bonds financing the project as debt service payments are made. The State’s allocable share of such debt service expense is based upon the State’s share of eligible project costs and the total amount financed by the town. Under the pre-1996 program, the State’s reimbursement payments continue over the life of the outstanding school bonds and any subsequent bond issues necessary to completely fund the approved school building projects.

Progress Payment Reimbursement System. Pursuant to State law, for all school building projects approved on or after July 1, 1996, the State makes proportional progress payments during construction for the State’s share of the eligible construction costs, provided that 5% of the State assistance is withheld pending completion of a final audit. Because the bulk of the State’s share of the eligible project costs is paid shortly after a town submits its request for progress payments, a town is no longer required to issue bonds to finance the State’s share of the project costs.

Presently, the Town estimates receiving between approximately 20% to 25% of the overall eligible project costs of its current school building program from the State of Connecticut as grants. The Town has received approximately $40,000,000 of such grants for various school building projects under this program.

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School Facilities

Date of Construction/ Enroll- Number Additions and Type of Number of ment Rated of Portable School Grades Renovations Construction Classrooms 10/1/10 1 Capacity 2 Classrooms Burr...... K-5 2004 Cncrt./Steel 27 400 504 -- Dwight ...... K-5 1962, 69, 2000 Brick/Steel 21 315 399 -- Holland Hill ...... K-5 1956, 78, 2001 Brick/Steel 20 333 378 3 Jennings ...... K-5 1967, 2000,02 Brick/Steel 23 347 378 1 McKinley ...... PreK-5 2003 Brick/Steel 30 471 504 -- Mill Hill ...... K-5 1955, 78, 91, 2000 Brick/Steel 20 474 483 5 North Stratfield ...... K-5 1961, 96, 2000 Brick/Steel 26 483 462 -- Osborn Hill ...... K-5 1958, 69, 97, 2009 Brick/Steel 27 538 525 -- Riverfield ...... K-5 1959, 71, 2000 Brick/Steel 22 451 483 5 Sherman ...... K-5 1963, 78, 2001, 09 Brick/Steel 25 442 462 1 Stratfield ...... K-5 1929, 48, 72, 2010 Brick/Wood 24 504 504 -- Fairfield Woods ...... 6-8 1954, 61, 72, 95 Brick/Steel 46 668 650 -- Roger Ludlowe ...... 6-8 2003 Brick/Steel 68 985 875 -- Tomlinson...... 6-8 1917, 42, 59, 78, 2003, 06 Brick/Wood 51 784 750 -- Fairfield Ludlowe 3 ... 9-12 1950, 63, 72, 95, 2005 Brick/Steel 92 1,479 1,400 -- Fairfield Warde 3...... 9-11 1955, 72, 90, 2003, 06 Brick/Steel 90 1,352 1,400 -- Total...... 612 10,026 10,157 14 1 Excludes 52 pre-school students enrolled in the Early Childhood Center ("ECC”). 2 Rated capacity based on elementary average class size of 21 allowing for music, art and special education space. 3 Includes the Alternative High School Program operating from an offsite facility. Source: Town of Fairfield, Board of Education.

School Enrollment 1 Historical and Projected Elementary School Pre K-5 Middle High Total Year & ECC School School Enrollment Historical 2001-2002 4,214 2,016 2,056 8,286 2002-2003 4,276 2,044 2,160 8,480 2003-2004 4,402 2,046 2,275 8,723 2004-2005 4,474 2,023 2,401 8,898 2005-2006 4,677 2,092 2,438 9,207 2006-2007 4,798 2,088 2,538 9,424 2007-2008 4,877 2,221 2,611 9,709 2008-2009 4,993 2,285 2,643 9,921 2009-2010 4,870 2,411 2,751 10,032 2010-2011 4,850 2,437 2,831 10,118 Projected 2011-2012 4,820 2,519 2,884 10,223 2012-2013 4,768 2,537 3,011 10,316 2013-2014 4,828 2,492 3,102 10,422 2014-2015 4,887 2,494 3,193 10,574 2015-2016 4,988 2,400 3,278 10,666

1 Includes students in special education. Source: Town of Fairfield, Board of Education. 17

III. Economic and Demographic Information

Population and Density

% Increase Year Population (Decrease) Density 1 1960 46,183 51.5% 1,509 1970 56,744 22.9% 1,854 1980 54,849 -3.3% 1,792 1990 53,418 -2.6% 1,746 2000 57,340 7.3% 1,874 2010 59,404 3.6% 1,941

1 Per square mile: 30.6 square miles. Sources: 1960 – 2010, U.S. Department of Commerce.

Age Distribution of the Population

Town of Fairfield State of Connecticut Number Percent Number Percent Under 5 years of age ...... 4,101 7.2% 223,344 6.6% 5 – 19 years of age ...... 11,971 20.8 702,358 20.6 20 – 24 years of age...... 3,137 5.5 187,571 5.5 25 – 44 years of age...... 15,764 27.5 1,032,689 30.3 45 – 64 years of age...... 13,020 22.7 789,420 23.2 65 years of age and over ...... 9,347 16.3 470,183 13.8 Total ...... 57,340 100.0% 3,405,565 100.0% Median Age (years) ...... 38.5 37.4

Source: U.S. Department of Commerce, Bureau of the Census, 2000. Educational Attainment Years of School Completed Age 25 and Over

Town of Fairfield State of Connecticut Number Percent Number Percent Less than 9th grade ...... 1,150 3.0% 132,917 5.8% 9th to 12th grade ...... 2,067 5.4 234,739 10.2 High School graduate ...... 7,271 19.1 653,300 28.5 Some college, no degree ...... 5,553 14.6 402,741 17.5 Associate's degree ...... 2,183 5.7 150,926 6.6 Bachelor's degree ...... 11,218 29.4 416,751 18.2 Graduate or professional degree ...... 8,716 22.8 304,243 13.2 Total ...... 38,158 100.0% 2,295,617 100.0%

Total high school graduate or higher (%) ...... 91.6% 84.0% Total bachelor's degree or higher (%) ...... 52.2% 31.4%

Source: U.S. Department of Commerce, Bureau of the Census, 2000.

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Income Levels

Town of State of United Fairfield Connecticut States Median Family Income, 2007 ...... $121,749 $80,906 $60,374 Median Family Income, 1999 ...... $100,920 $65,521 $49,600 Median Family Income, 1989 ...... $65,070 $49,199 $35,353

Per Capita Income, 2007...... $49,702 $35,295 $26,178 Per Capita Income, 1999...... $43,670 $28,766 $21,690 Per Capita Income, 1989...... $26,875 $20,189 $14,617

% Families Below Poverty Level, 2007...... 2.1% 5.9% 9.8% % Families Below Poverty Level, 1999...... 1.8% 5.6% 9.2% % Families Below Poverty Level, 1989...... 1.6% 5.0% 10.0% Source: U.S. Department of Commerce, Bureau of the Census, 1990 and 2000. American Community Survey 2007, estimate.

Income Distribution

Town of Fairfield State of Connecticut Families Percent Families Percent Less than $10,000...... 505 2.6% 73,812 5.6% $10,000 - 14,999 ...... 424 2.2 56,806 4.3 $15,000 - 24,999 ...... 1,108 5.6 107,049 8.1 $25,000 - 34,999 ...... 964 4.9 108,963 8.2 $35,000 - 49,999 ...... 1,443 7.3 161,056 12.2 $50,000 - 74,999 ...... 2,396 12.2 237,019 17.9 $75,000 - 99,999 ...... 2,614 13.3 190,017 14.4 $100,000 - 149,999 ...... 3,580 18.2 210,861 15.9 $150,000 - 199,999 ...... 2,207 11.2 80,733 6.1 $200,000 or more ...... 4,417 22.5 97,115 7.3 Total ...... 19,658 100.0% 1,323,431 100.0% Source: U.S. Department of Commerce, Bureau of the Census, American Community Survey 2007, estimate.

Major Employers As of May 15, 2011

Approximate Number Employer Business Employed Town of Fairfield ……………Local Government & School District 1,167 Sacred Heart University ………Higher Education 1,156 Fairfield University ………… Higher Education 885 General Electric Company ……Corporate Headquarters 723 Carolton Hospital ……………Medical Facility 400 Stop & Shop …………………Merchandiser 360 Home Depot …………………Merchandiser 219 R. J. Bigelow Tea Co…………Tea Manufacturer 155 BJ’s Wholesale Club …………Wholesale Merchandiser 126 Heim Universal ………………Bearing Manufacturer 110 Total ……………………………………………………………………………… 5,301 Source: Town of Fairfield, Office of Community and Economic Development.

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Employment by Industry Employed Persons 16 Years of Age and Over

Town of Fairfield State of Connecticut Sector Number Percent Number Percent Agriculture, forestry, fisheries ...... 94 0.4% 7,445 0.5% Construction ...... 1,259 4.8 99,913 6.0 Manufacturing ...... 2,606 9.9 246,607 14.8 Wholesale trade ...... 937 3.6 53,231 3.2 Retail trade ...... 2,876 10.8 185,633 11.2 Transportation, warehousing, utilities ...... 544 2.1 64,662 3.9 Information ...... 1,374 5.2 55,202 3.3 Finance, insurance, real estate ...... 3,716 14.1 163,568 9.8 Professional, scientific, management, administrative.... 4,260 16.1 168,334 10.1 Educational, health, social services...... 5,533 21.0 366,568 22.0 Art, entertainment, recreation, accommodation, food .. 1,350 5.1 111,424 6.7 Other professional services ...... 1,167 4.4 74,499 4.5 Public administration ...... 656 2.5 67,354 4.0 Total Labor Force, Employed ...... 26,372 100.0% 1,664,440 100.0% Source: U.S. Department of Commerce, Bureau of the Census, 2000.

Percentage Unemployed 1

Bridgeport- Town of Stamford State of Fairfield Labor Market 2 Connecticut United States Period May 2011 ...... 7.6% 8.5% 9.1% 8.7%

Annual Average 2010...... 7.6% 8.4% 9.0% 9.6% 2009...... 7.3 7.8 8.2 9.3 2008...... 4.6 5.3 5.7 5.8 2007...... 3.7 4.1 4.6 4.6 2006...... 3.4 3.9 4.3 4.6 2005...... 3.9 4.5 4.9 5.1 2004...... 4.0 4.6 4.9 5.5 2003 ...... 4.5 5.1 5.5 6.0 2002...... 3.6 4.3 4.4 5.8 2001...... 2.6 4.1 3.1 4.7

1 Not seasonally adjusted. 2 The State of Connecticut, Department of Labor currently reports the Town of Fairfield’s unemployment rate as part of the Bridgeport-Stamford Labor Market Area. The Annual Average unemployment rates (2001-2004) are from the former Bridgeport Labor Market Area. Source: State of Connecticut, Department of Labor.

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Land Use Summary As of May 15, 2011 Developed Undeveloped

Land Use Category Acres % Total Land Use Category Acres % Total Residential...... 15,257 78.0 Residential ...... 536 2.7 Commercial ...... 453 2.3 Commercial...... 13 0.1 Industrial...... 424 2.2 Industrial...... 3 -- Other...... 1,470 7.5 Other...... 1,418 7.2 Total Area ...... 17,604 90.0 Total Area 1,970 10.0

Source: Town of Fairfield, Planning and Zoning Department.

Housing Inventory

Type of Structure Units Percent 1 unit detached ...... 16,627 79.1 1 unit attached ...... 1,050 5.0 2 to 4 units ...... 2,342 11.1 5 to 9 units ...... 346 1.6 10 or more units ...... 620 3.0 Mobile home, trailer, other ...... 44 0.2 Total Inventory ...... 21,029 100.0 Source: U.S. Department of Commerce, Bureau of the Census, 2000.

Age Characteristics of Housing

Town of Fairfield State of Connecticut Year Built Units Percent Units Percent 1939 or earlier ...... 4,386 20.9 308,896 22.3 1940 to 1959 ...... 8,499 40.4 359,042 25.9 1960 to 1969 ...... 3,194 15.2 212,176 15.4 1970 to 1979 ...... 2,140 10.2 203,377 14.7 1980 to 1989 ...... 1,609 7.6 183,405 13.2 1990 to 1994 ...... 386 1.8 56,058 4.0 1995 to 1998 ...... 559 2.7 47,028 3.4 1999 to March 2000...... 256 1.2 15,993 1.1 Total housing units, 2000 ...... 21,029 100.0 1,385,975 100.0

Percent Owner Occupied, 2000 ...... 83.1% 66.8% Source: U.S. Department of Commerce, Bureau of the Census, 2000.

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Value of Owner-Occupied Housing

Town of Fairfield State of Connecticut Specified Owner-Occupied Units Number Percent Number Percent Less than $50,000...... 13 0.1 5,996 0.8 $ 50,000 to $ 99,999...... 92 0.6 85,221 11.7 $100,000 to $149,999...... 409 2.7 212,010 29.1 $150,000 to $199,999...... 1,589 10.5 156,397 21.5 $200,000 to $299,999...... 4,718 31.1 137,499 18.9 $300,000 to $499,999...... 4,839 31.9 79,047 10.9 $500,000 to $999,999...... 2,703 17.9 38,168 5.2 $1,000,000 and over...... 790 5.2 13,906 1.9 Total ...... 15,153 100.0 728,244 100.0

Median Housing Value...... $325,900 $166,900 Source: U.S. Department of Commerce, Bureau of the Census, 2000.

Building Permits Last Ten Years

Fiscal Year Residential Commercial/Industrial Other Construction 1 Total Ending No. Value No. Value No. Value No. Value 20112 38 $14,520,000 4 $28,214,000 1,002 $ 92,434,000 1044 $135,168,000 2010 32 13,330,101 5 24,926,735 1081 63,826,106 1118 102,082,942 2009 37 13,752,400 9 6,109,000 929 54,246,683 975 74,108,083 2008 81 32,973,071 16 6,959,159 1156 68,279,518 1253 108,211,748 2007 111 30,984,373 10 21,388,200 1,311 70,404,688 1432 122,777,261 2006 127 37,939,430 6 24,465,233 1,358 72,751,598 1491 135,156,261 2005 114 30,976,940 8 12,916,082 1,574 103,336,733 1696 147,229,755 2004 94 38,010,128 1 1,500,000 1,507 77,210,109 1602 116,720,237 2003 62 13,718,000 2 782,000 1,319 135,307,000 1383 149,807,000 2002 55 15,721,000 0 - 1,295 60,795,000 1350 76,516,000

1 Includes additions, alterations, swimming pools and the like. 2 July 1, 2010 through May 31, 2011.

Source: Town of Fairfield, Building Department.

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IV. Tax Base Data Property Tax Assessments The maintenance of an equitable tax base and the location and appraisal of all real and personal property within the Town for inclusion onto the Grand List are the responsibilities of the Assessor’s Office. The Grand List represents the total of assessed value for all taxable real property, personal property and motor vehicles located within the Town as of October 1. Assessments for real property are computed at 70% of the estimated market value at the time of the last general revaluation.

The Town's last general revaluation of real property was completed as of October 1, 2010. Pursuant to Section 12-62 et. seq. of the Connecticut General Statutes, as amended, the Town must next revalue all real estate as of October 1, 2015, and every fifth year thereafter. A revaluation by physical inspection must be made at any time up to October 1, 2015 (not later than ten years from the preceding physical inspection).

Any taxpayer who is unsatisfied with any new assessment may file a written appeal of such assessment with the Town’s Board of Assessment Appeals and may receive, subject to the discretion of the Board of Assessment Appeals, an appeal hearing and final determination of any increase or decrease from the property's original assessment. Each year the Board of Assessment Appeals determines whether adjustments to the Assessor’s list on assessments under appeal are warranted.

When a new structure, or modification to an existing structure, is undertaken, the Assessor's Office receives a copy of the permit issued by the Building Official. A physical appraisal is then completed and the structure classified and priced from a schedule developed at the time of the last general revaluation. The property depreciation and obsolescence factors are also considered when arriving at an equitable value.

Personal Property. All personal property (furniture, fixtures, equipment, and machinery) is assessed annually. An assessor's check and audit is completed periodically. Assessments for personal property are computed at seventy percent (70%) of present market value.

Motor Vehicles. Motor vehicle lists are furnished to the Town by the State of Connecticut and appraisals of motor vehicles are accomplished in accordance with an automobile price schedule developed by the Connecticut Association of Assessing Officials. Section 12-71b of the Connecticut General Statutes, as amended, provides that motor vehicles which are registered with the Commissioner of Motor Vehicles after the October 1 assessment date but prior to the first day of August in such assessment year, are subject to a property tax as if the motor vehicle had been included on the October 1 Grand List. The tax is prorated, and the pro-ration is based on the number of months of ownership, including the month of registration, to the next succeeding October 1. Cars purchased in August and September are not taxed until the next October 1 Grand List. If the motor vehicle replaces a motor vehicle that was taxed on the October 1 Grand List, the taxpayer is entitled to certain credits. Assessments for motor vehicles are computed at 70% of the annual appraisal of market value.

Section 12-124a of the Connecticut General Statutes, as amended, permits a municipality, upon approval by its legislative body, to abate property taxes on owner-occupied residences to the extent that the taxes exceed eight percent of the owner's total income from any source, adjusted for self-employed persons to reflect expenses allowed in determining adjusted gross income. The owner must agree to pay the amount of taxes abated with interest at 6% per annum, or at such rate approved by the legislative body, at such time that the residence is sold or transferred or on the death of the last surviving owner. A lien for such amounts is recorded in the land records but does not take precedence over any mortgage recorded before the lien. The Town has approved the use of this abatement provision.

Levy

For Fiscal Year Ending June 30, 2010 the Town derived 86.77% of its total revenues through a direct property tax. Real estate property taxes for the fiscal year are paid on the Grand List of the prior October 1, and are due July 1, payable in four installments on July 1, October 1, January 1 and April 1. Personal property taxes are payable in two installment on July 1 with motor vehicle supplemental bills payable on January 1. Payments not received by August 1 and February 1 become delinquent. Motor vehicle property taxes are due twice a year on July 1 and January 1. A margin against delinquencies, legal reductions, and Grand List adjustments, such as any Assessor’s errors, is provided 23 by adjusting the Grand List downward when computing anticipated property tax revenue from the current levy. An estimate for delinquent taxes and outstanding interest and lien fees anticipated to be collected during the fiscal year is normally included as a revenue item in the budget. Delinquent taxes are billed monthly, with interest charged at the rate of one and one-half percent per month with a minimum charge of $2. In accordance with State law, the oldest outstanding tax is collected first. Outstanding real estate tax accounts are liened each year prior to June 30 with legal demands and alias tax warrants used in the collection of personal property and motor vehicle tax bills. Delinquent motor vehicle and personal property accounts are transferred to a suspense account after three years at which time they cease to be carried as receivables. Real estate accounts are transferred to suspense fifteen years after the due date in accordance with State statutes.

Net Taxable Grand List

Residential Commercial& Gr an d Real Industrial Unimproved Personal Motor List of Property Real Land Property Vehi cl e Gr oss Taxable L ess Net Taxable % 10/1 (%) Property (%) (%) (%) (%) Grand List Exemptions Grand List Gr owth 20101 82.4 10.4 0. 9 2. 2 4.1 $ 10,842,663, 653 $ 54,938,023 $ 10,787,725,630 -10.11% 2009 84.7 8.9 0. 9 2. 0 3.5 12,056,513,143 54,846,637 12,001,666,506 0.59% 2008 84.6 9.2 1. 0 1.7 3.5 11,985,444,899 54,036,118 11,931,408,781 0.48% 2007 84.6 9.0 0.9 1.8 3.7 11,930,013,752 55,727,390 11,874,286,362 0.93% 2006 84.6 9.2 1. 0 1.5 3.7 11,822,101,101 56,943,734 11,765,157,367 0.99% 20051 84.6 9.2 1. 1 1. 4 3.7 11,706,984,446 56,666,409 11,650,318,037 59.99% 2004 82.0 10.0 1.0 2.2 5.8 7,312,471,717 30,585,484 7,281,886,233 1.13% 2003 82.0 9.4 1. 0 2. 2 5.4 7,233,062,136 32,445,529 7,200,616,607 0.25% 2002 81.5 9.6 1.0 2.2 5.7 7,217,904,944 34,949,339 7,182,955,605 0.04% 20011 81.2 9.6 1. 2 2.5 5.5 7,219,611,785 39,699,799 7,179,911,986 59.23% 1 Revaluation. Source: Town of Fairfield, Assessor's Office.

Ten Largest Taxpayers Percent of Ta xable Net Taxable Name Nature of Business Valuation Grand List 1 General Electric Company ……… Corporate Headquarters $ 70,194,895 0.65% Conn Light & Power Co ………… Public Utility 61,522,677 0.57% Kleban Holding Co. et als…………Real Estate Developer 60,861,029 0.56% Lenoci Alfred et als……………… Real Estate Developer 57,095,924 0.53% Aquarion Water Co……………… Public Utility 54,307,518 0.50% Roberts et als Properties………… Real Estate Developer 24,827,294 0.23% Jack Bradley………………………Residential Homeowner 24,458,250 0.23% Scinto Robert et als…………………Real Estate Developer 23,042,630 0.21% Trust Realty et als…………………Real Estate Developer 20,408,973 0.19% United Illuminating Co.……………Public Utility 17,574,110 0.16% Total ……………………………………………………………… $ 414,293,300 3.84%

1 Based on a 10/1/2010 Net Taxable Grand List of $10,787,725,630. Source: Town of Fairfield, Assessor's Office.

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Tax Exempt Property

Public Assessed Value State of Connecticut …………………………………$ 20,975,960 Town of Fairfield …………………………………… 491,668,430 United States ………………………………………… 9,706,550 Sub-Total Public …………………………………………$ 522,350,940

Private Scientific, educational, historical, charitable, etc.……$ 428,642,830 Cemeteries ………………………………………… 21,231,630 Churches …………………………………………… 109,465,160 Veteran's Organizations …………………………… 317,520 Recreation Facilities ………………………………… 8,429,540 Sub-Total Private ……………………………………… 568,086,680 Total Exempt ……………………………………… $ 1,090,437,620

Percent Compared to Net Taxable Grand List1 10.11%

1 Based on a 10/1/2010 Net Taxable Grand List of $10,787,725,630. Source: Town of Fairfield , Assessor’s Office.

Property Tax Levies and Collections

Uncollecte d Percent of Percent of Annual Levy Annual Levy Percent of Gr and Fiscal Collected at Uncollected at Annual Levy List of Year Net Taxable Mill End of Fiscal End of Fiscal Uncollected 10/1 Ending Grand List Rate Tax Levy Year Year as of 5/31/111 2009 2011 $12,001,666,506 19.27 $228,596,890 IN COLLECTION 1.40% 2008 2010 11,931,408,781 18.90 222,534,198 98.90% 1.10% 0.40% 2007 2009 11,874,386,362 18.58 218,119,150 98.80% 1.20% 0.20% 2006 2008 11,765,157,367 17.41 201,569,417 99.02% 0.98% 0.10% 20052 2007 11,650,318,037 16.67 190,604,617 99.06% 0.94% 0.10% 2004 2006 7,281,886,233 24.80 180,590,779 99.15% 0.85% Nil 2003 2005 7,200,616,607 23.40 165,087,202 99.02% 0.98% Nil 2002 2004 7,182,955,655 21.50 154,589,074 98.98% 1.02% Nil 2001 2003 7,179,911,986 20.30 144,734,149 98.98% 1.02% Nil 20002 2002 4,537,623,448 29.20 132,498,605 98.98% 1.02% Nil 1 Unaudited estimate. 2 Revaluation . Source: Town of Fairfield, Tax Collector's Office.

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V. Debt Summary Principal Amount Of Bonded Indebtedness1 Long-Term Debt As of July 22, 2011 Original Principal Date of Iss ue Amount Fiscal Coupon Outstanding Year Dated Purpose Rate % (Pro Forma) Maturity 10/01/96 Clean Water Fund PLO 245-D………… 2.0 $71,122 2016 12/31/96 Clean Water Fund PLO 355-C ………… 2.0 393,704 2016 07/01/98 Clean Water Fund PLO 245-C 2 ………… 2.0 252,526 2018 11/26/98 Clean Water Fund PLO 399-D ………… 2.0 807,537 2019 04/01/02 General Purposes ……………………… 4.0-5.50 380,000 2012 04/01/02 Schools3 ……………………………... … 4.0-5.50 1, 665, 000 2012 05/01/02 Refunding - General Purposes ………… 4.0-4.375 425,350 2012 05/01/02 Refunding – Schools3 …………………… 4.0-4.375 470,600 2012 05/01/02 Refunding - Sewers ……………………… 4. 0-4.375 9, 050 2012 07/01/03 Refunding - General Purposes ………… 2.0-4.5 189,000 2013 07/01/03 Refunding - Schools 3 …………………… 2.0-4.5 2,761,000 2013 07/01/03 Refunding - Sewers ……………………… 2.0-4. 5 55, 000 2013 03/18/04 Refunding A - General Purposes ……… 2.0-5.0 2,347,000 2020 03/18/04 Refunding A – Schools3 ………………… 2.0-5. 0 14, 509, 000 2020 03/18/04 Refunding A - Sewers …………………… 2.0-5.0 339,000 2020 07/01/04 Clean Water Fund PLO 399-C ………… 2.0 17,561,046 2023 11/19/04 Refunding B - General Purposes ……… 2.0-4.25 2, 186, 000 2022 11/19/04 Refunding B – Schools3 ………………… 2.0-4.25 12,079,000 2022 07/15/05 Schools3 ………………………………… 3.25-5.0 21,300,000 2026 07/15/07 General Purposes ……………………… 4.0-5.0 918,298 2028 07/15/07 Schools3 ………………………………… 4.0-5. 0 18, 511, 702 2028 05/29/08 Refunding - General Purposes ………… 3.5-5.0 4,847,276 2023 05/29/08 Refunding – Schools3 …………………… 3.5-5. 0 36, 150, 340 2023 05/29/08 Refunding - Sewers ……………………… 3.5-5.0 142,384 2023 07/15/08 General Purposes ……………………… 3.125-5.0 3,987,000 2029 07/15/08 Schools3 ………………………………… 3. 125-5.0 17, 503, 000 2029 08/13/09 Refunding - General Purposes ………… 5.0 802,000 2021 08/13/09 Refunding – Schools3 …………………… 5.0 18, 608, 000 2021 07/15/10 General Purposes ……………………… 3.0-5.0 9,100,000 2031 07/15/10 Schools ………………………………… 3.0-5.0 15,900,000 2031 Total Bonds Outstanding ……...………………………………………………… $204,270,935

1 Excludes capita l leases . See Appendix A, Detailed Notes, Section III, subsection F.3. 2 CWF PLO 245-C is an obligation of the Water Pollution Control Authority (the “WPCA”) for which the Town expects to be paid by user fees and other revenues of the WPCA; however, CWF PLO 245-C is secured by the full faith and credit of the Town. See “Clean Water Fund Program” herein. 3 For school building projects approved prior to July 1, 1996, the State of Connecticut will reimburse the Town for eligible principal and interest costs over the life of outstanding bonds and, for school building projects approved on or after July 1, 1996, the Town expects to receive school building grants from the State of Connecticut in the form of progress payments for eligible project costs. See “School Projects” herein.

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Short-Term Debt As of July 22, 2011 (Pro-Forma) This Issue: Total Amount Notes Due Project Authorized 7/20/12 BOE LAN Switches……..……………… $ 450,000 $ 450,000 Capital Non-Recurring FYE ’07 ……… 2,708,000 773,500 Capital Non-Recurring FYE ’08 ……… 3,141,595 2,340,000 Capital Non-Recurring FYE ’09 ……… 4,989,712 4,680,150 Capital Non-Recurring FYE '10 ……… 3,106,250 3,100,000 Capital Non-Recurring FYE '12………… 2,005,000 2,005,000 Compost Facility Improvements ……… 800,000 100,000 Fairfield Woods Middle School………… 24,203,000 1 15,000,000 Flood Control Projects ………………… 640,000 205,000 Holland Hill Fuel Tanks……..………… 100,000 100,000 Penfield Construction…………………… 3,106,695 3,080,000 Road Paving…………………………… 5,800,000 1,900,000 Sherman Upgrades……………………… 2,250,000 2,250,000 Softball Field……..…………………… 350,000 350,000 Stratfield Elementary Construction.…… 17,315,000 1 4,901,350 Tomlinson Field ………………………… 350,000 145,000 Total ……………………………………$ 75,867,552 $ 41,380,000

1 For school construction projects approved prior to July 1, 1996, the State of Connecticut reimburses the Town for eligible principal and interest costs over the life of outstanding bonds and, for school construction projects approved on or after July 1, 1996, the Town expects to receive school building construction grants from the State of Connecticut in the form of progress payments for eligible project costs. See “School Projects” herein.

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Annual Bonded Debt Maturity Schedule 1, 2 As of July 22, 2011 (Pro Forma) Cumulative Fiscal Principal Year Principal Interest Total Retired 20123 $ 12,160,082 $ 5,003,510 $ 17,163,592 6.0% 2013 14,659,700 7,656,164 22,315,864 13.1% 2014 14,774,144 7,126,931 21,901,075 20.4% 2015 14,959,181 6,524,362 21,483,543 27.7% 2016 15,148,075 5,910,408 21,058,483 35.1% 2017 14,435,600 5,275,184 19,710,784 42.2% 2018 14,582,899 4,708,730 19,291,629 49.3% 2019 13,789,013 4,069,927 17,858,940 56.1% 2020 13,992,469 3,465,430 17,457,899 62.9% 2021 14,051,565 2,862,709 16,914,274 69.8% 2022 14,236,112 2,289,630 16,525,742 76.8% 2023 10,487,095 1,743,278 12,230,373 81.9% 2024 7,090,000 1,308,071 8,398,071 85.4% 2025 7,145,000 1,033,163 8,178,163 88.9% 2026 7,205,000 752,006 7,957,006 92.4% 2027 4,665,000 518,425 5,183,425 94.7% 2028 4,740,000 332,772 5,072,772 97.0% 2029 3,150,000 177,469 3,327,469 98.5% 2030 1,500,000 88,125 1,588,125 99.3% 2031 1,500,000 30,000 1,530,000 100.0% Total $ 204,270,935 $ 60,876,294 $ 265,147,229 1 Includes Clean Water Fund Project Loan Obligations, including CWF PLO 245-C which is an obligation of the Water Pollution Control Authority (the “WPCA”) for which the Town expects to be paid by user fees and other revenues of the WPCA; however, CWF PLO 245-C is secured by the full faith and credit of the Town. See "Clean Water Fund Program” herein. 2 Excludes capital leases. See Appendix A, Detailed Notes, Section III, subsection F.3. 3 Excludes $1,954,854 in principal and $3,594,568 interest payments made by the Town from July 1, 2011 through July 22, 2011, including payments on the Clean Water Fund Project Loan Obligations.

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Overlapping/Underlying Debt The Town of Fairfield has neither overlapping nor underlying debt.

Clean Water Fund Program

The Town of Fairfield is a participant in the State of Connecticut's Clean Water Fund Program (Connecticut General Statutes Sections 22a-475 et seq., as amended) which provides financial assistance through a combination of grants and loans bearing interest at a rate of 2% per annum. All participating municipalities receive a grant of 20% and a loan of 80% of total eligible costs (with the exception of combined sewer overflow correction projects which are financed with a 50% grant and a 50% loan).

Loans to each municipality are made pursuant to a Project Grant and Project Loan Agreement. Each municipality is obligated to repay only that amount which it draws down for the payment of project costs (“Interim Funding Obligations”). Each municipality must deliver to the State an obligation secured by the full faith and credit of the municipality, and/or a dedicated source of revenue of such municipality.

Amortization of each loan is required to begin one year from the earlier of the project completion date specified in the Project Grant and Project Loan Agreement, or the actual project completion date. The final maturity of each loan is twenty years from the scheduled completion date. Principal and interest payments are payable (1) in equal monthly installments commencing one month after the scheduled completion date, or (2) in single annual installments representing 1/20 of total principal not later than one year from the project completion date specified in the Loan Agreement and thereafter in monthly installments. Loans made under loan agreements entered into prior to July 1, 1989 are repayable in annual installments. Borrowers may elect to make level debt service payments or level principal payments, and may prepay their loans at any time prior to maturity without penalty.

The following Clean Water Fund Project Loan Obligations (“CWF-PLOs”) will be outstanding as of July 22, 2011 (pro-forma):

Amount 2% Loans Project Authorized Outstanding CWF PLO 245-D (1996) ………… $ 1,000,000 $ 71,122 CWF PLO 355-C (1996) ………… 4,000,000 393,704 CWF PLO 245-C (1998)1 ……… 1,265,000 252,526 CWF PLO 399-D (1999) ………… 2,580,000 807,537 CWF PLO 399-C (2004) ………… 29,436,399 17,561,046 Total ……………………………… $ 38,281,399 $ 19,085,935

1 CWF PLO 245-C is an obligation of the Water Pollu tion Contr ol Authority (the “WPCA”) for which the Town expects to be paid by user fees and other revenues of the WPCA; however, the WPCA’s loans are secured by the full faith and credit of the Town.

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Debt Statement 1 As of July 22, 2011 (Pro Forma)

Long-Term Debt Outstanding: General Purpose……………………………………………………..…………………… $ 25,181,924 Schools …………………………………………………..……………………………… 159,457,642 Sewers……………………………………………………………. ……………………… 545,434 Clean Water Fund ………………………………………………………………………… 19,085,935 Total Long-Term Debt ………………………………………………………………… 204,270,935 Short-Term Debt: Bond Anticipation Notes (this issue ) ………………………………………………… 41,380,000 Total Short-Term Debt ……………………………………………………………… 41,380,000 Total Direct Debt ……………………………………………………………………… 245,650,935 Less: State of Connecticut School Grants Receivable (6/30/11) 2…………………… (1,615,000) Self-supporting WPCA Debt 3 …………………………………………………… (252,526) Total Overall Net Debt ……………………………………………………………… $ 243,783,409 1 Excl udes capi tal l eases. See Appendix A, Detailed Notes, Section III, subsection F.3.

2 For school building projects approved prior to July 1, 1996, the State of Connecticut will reimburse the Town for eligible principal and interest costs over the life of outstanding bonds. Amount shown is for principal only. See “School Projects” herein. 3 CWF PLO 245-C is an obligation of the Water Pollution Control Authority (the “WPCA”) for which the Town expects to be paid by user fees and other revenues of the WPCA; however, the WPCA’s loans are secured by the full faith and credit of the Town. Amount shown is for principal only. See “Clean Water Fund Program” herein.

Current Debt Ratios As of July 22, 2011 (Pro Forma)

Population1 ………………………………………………………… 59,404 Net Taxable Grand List (10/1/2009) ……………………………… $ 10,787,725,630 Estimated Full Value (Net Taxable Grand List/70%) ……………… $ 15,411,036,614 2 Equalized Net Taxable Grand List (2008) ………………………… $ 15,496,392,316 Income per Capita (1989)3 ………………………………………… $26,875 Income per Capita (1999)4 ………………………………………… $43,670

Total Total Overall Direct Debt Net Debt $245,650,935 $243,783,409 Debt Per Capita …………………………………………………… $ 4,135.26 $ 4,103.82 Ratio to Net Taxable Grand List …………………………………… 2.28% 2.26% Ratio to Estimated Full Value (Net Taxable Grand List/70%) …… 1.59% 1.58% Ratio to Equalized Net Taxable Grand List ……………………… 1.59% 1.57% Debt per Capita to I ncome per Capita (1989) ……………………… 15.39% 15.27% Debt per Capita to I ncome per Capita (1999) ……………………… 9.47% 9.40%

1 Department of Commerce, U.S. Bureau of the Census, 2010. 2 State of Connecticut, Office of Policy and Management. 3 Department of Commerce, U.S. Bureau of the Census, 1990. 4 Department of Commerce, U.S. Bureau of the Census, 2000.

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Temporary Financing

When general obligation bonds have been authorized, bond anticipation notes may be issued maturing no more than two years from which they are issued (CGS Sec. 7-378). Temporary notes may be renewed up to ten years from their original date of issue as long as all project grant payments are applied toward payment of temporary notes when they become due and payable and the legislative body schedules principal reductions by the end of the third and each subsequent year during which such temporary notes remain outstanding in an amount equal to a minimum of 1/20th (1/30th for certain sewer and school projects) of the estimated net project cost (CGS Sec. 7-378a). The term of the bond issue is reduced by the amount of time temporary financing exceeds two years, or, for sewer and school projects, by the amount of time temporary financing has been outstanding.

Temporary notes must be permanently funded no later than ten years from the initial borrowing date, except for sewer or school notes issued in anticipation of state and/or federal grants. If a written commitment exists, the municipality may renew the sewer or school notes from time to time in terms not to exceed six months until such time that the final grant payments are received (CGS Sec. 7-378b).

Temporary notes may also be issued for up to 15 years for certain capital projects associated with the operation of a waterworks system (CGS Sec. 7-244a) or a sewage system (CGS Sec. 7-264a). In the first year following the completion of the project(s), or in the sixth year following the issuance of such notes (whichever is sooner), and in each year thereafter, the notes must be reduced by at least 1/15 of the total amount of the notes issued by funds derived from certain sources of payment. Temporary notes may be issued in one year maturities for up to 15 years in anticipation of sewer assessments receivable, such notes to be reduced annually by the amount of assessments received during the preceding year (CGS Sec. 7-269a).

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Authorized But Unissued Debt As of July 22, 2011 (Pro Forma) Previously This Issue: Total Amount Bonded / Notes Due Notes Due Authorized but Project Authorized Paydowns 1 7/22/2011 7/20/2012 Unissued Debt 1 Capital Non-Recurring FYE ’06 …… $ 2,865,200 $ 2,256,500 $ - $ - 608,700 Capital Non-Recurring FYE ’07 …… 2,708,000 876,500 1,773,500 773,500 1,058,000 Capital Non-Recurring FYE ’08 …… 3,141,595 200,000 2,940,000 2,340,000 601,5952 Capital Non-Recurring FYE ’09 …… 4,989,712 - 4,985,000 4,680,150 309,5622 Capital Non-Recurring FYE '10 …… 3,106,250 - 3,100,000 3,100,000 6,250 Capital Non-Recurring FYE '11……… 887,000 885,000 - - 2,000 Capital Non-Recurring FYE '12……… 2,005,000 - - 2,005,000 - Compost Facility Improvements …… 800,000 600,000 200,000 100,000 100,000 Districtwide School Portables ……… 300,100 300,000 - - 1002 Fairfield Woods Middle School……… 24,203,000 5,080,000 2,549,000 15,000,000 4,123,000 Fairfield Woods M.S. (Prof. Fees) … 250,000 250,000 - - - Flood Control Projects ……………… 640,000 235,000 405,000 205,000 200,000 Holland Hill Fuel Tanks……..……… 100,000 - - 100,000 - Penfield Construction………………… 3,106,695 - - 3,080,000 26,695 Road Paving………………………3 … 5,800,000 2,900,000 - 1,900,000 1,000,000 Sherman Upgrades…………………… 2,250,000 - - 2,250,000 - BOE LAN Switches……..…………… 450,000 - - 450,000 - Softball Field……..………………… 350,000 - - 350,000 - Stratfield Elementary Construction.… 17,315,000 9,100,000 2,000,000 4,901,350 3,313,650 Stratfield Elem. Const. (Prof. Fees).… 250,000 250,000 - - - Tomlinson Field …………………… 350,000 187,500 162,500 145,000 17,500 Total ………………………………… $ 75,867,552 $ 23,120,500 $ 18,115,000 $ 41,380,000 $11,367,052

1 The total amount of bonds that can be issued for a project cannot exceed the authorized amount reduced by the grants received for that project.

2 The Town does not expect to issue any further long-term debt for these projects. In addition, the Town has other projects that have authorized but unissued amounts remaining but the Town does not anticipate any future long-term borrowing against these authorizations. 3 Of such authorization $1,000,000 does not become effective until April 1, 2012.

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Statement Of Statutory Debt Limitation As of July 22, 2011 (Pro Forma)

Total tax collections for the year ended June 30, 2011 (including interest and lien fees) ………………1 $ 225,763,182 Reimbursement for revenue loss on: Aid to elderly tax relief ………………………………………………………………………………….. 3,268,116 Base …………………………………………………………………………..…………………………$ 229,031,298

Unfunded General Urban Past Debt Limitation: Purposes Schools Sewers Renewal Pension 2 1/4 times base …………………… $ 515,320,421 $ - $ - -$ -$ 4 1/2 times base …………………… - 1,030,640,841 - - - 3 3/4 times base …………………… - - 858,867,368 - - 3 1/4 times base …………………… - - - 744,351,719 - 3 times base ……………………… - - - - 687,093,894 Total Debt Limitation ……………… 515,320,421 1,030,640,841 858,867,368 744,351,719 687,093,894

Indebtednes s 2: Outstanding Debt: Bonds Payable …………………… 25,181, 924 159,457,642 545, 434 - - Bonds……………………………… - - - Notes (This Issue) ………………… 18,283, 650 23,096,350 - - - Clean Water Fund PLOs 3 ………… - - 19,085,935 - - Author ized But Unissue d De bt …… 3,912, 802 7,454,250 - - - Total Outstanding De bt …………… 47,378, 376 190,008,242 19,631,369 - - Less: School Grants Receivable 4……… - (1,615,000) - - - Self-Supporting WPCA Debt 3 …… - - (252,526) - - Total Outstanding Net Debt ……… 47,378, 376 188,393,242 19,378,843 - - DEBT LIMITATION IN EXCESS OF INDEBTEDNESS ……………… $ 467,942, 045 $ 842,247,599 $ 839, 488, 525 $ 744,351, 719 $ 687,093,894 1 Subject to audit. 2 Excl udes capi tal l eases. 3 Includes CWF PLO 245-C that is an obligation of the Water Pollution Control Authority (the “WPCA”) for which the Town expects to be paid by user fees and other revenues of the WPCA; however, the WPCA’s loans are secured by the full faith and credit of the Town. See “Clean Water Fund Program” herein. 4 For school building projects approved prior to July 1, 1996, the State of Connecticut continues to reimburse the Town for eligible principal and interest costs over the life of the outstanding bonds. The amount of $2,881,063 represents the principal amount of total school grants receivable under the State’s school building reimbursement program in place prior to July 1, 1996. See “Schoo l Projects” herein.

Note: In no case shall total indebtedness exceed seven times annual receipts from taxation or $1,603,219,086.

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Principal Amount Of Outstanding Debt Last Five Fiscal Years (000s)

2010 2009 2008 2007 2006 Long-Term Debt Bonded Debt1 …………………… $195,202 $212,338 $198,465 $212,509 $196,505 Short-Term Debt Bond Anticipation Notes ……… 18,115 15,485 23,760 25,534 36,400 Totals ………………………… $213,317 $227,823 $222,225 $238,043 $232,905 1 Incl udes C lea n Water Fund Pro ject Loa n Obli gations but exclu des capital l eases. See App endix A, Detailed No tes, Section III, subsection F.3.

Ratio of Net Long-Term Debt to Valuation, Population and Income Last Five Fiscal Years

Ratio of Net Ratio of Net Ratio of Net Long-Term Long-Term Long -Term Debt Per Debt to Net Debt to Net Long- Capita to Fiscal Net Assessed Estimated Full Net Long- Assessed Estimated Term Debt Per Capita Year Val ue Valu e Term Debt 12Value Full Value Population Per Capita Income 3 2010 $11,931,408,781 $17,044,869,687 $193,174,000 1.62% 1.13% 57,578 3,355 13.02 2009 11,874,286,362 16,963,266,231 209,895,000 1.77% 1.24% 57,578 3,645 11.98 2008 11,765,157,367 16,807,367,667 195,517,000 1.66% 1.16% 57,345 3,409 12.81 2007 11,650,318,037 16,643,311,481 196,985,626 1.69% 1.18% 57,548 3,423 12.76 2006 7,281,886,233 10,402,694,619 194,268,192 2.67% 1.87% 57,930 3,353 13.02 1 Amounts roun ded. Includes Clean Water Fund Project Loan Obligations, but excludes capital leases. See Appen dix A, Detailed Notes, Section III, subsection F.3. Long-term debt is net of estimated school building grants receivable at the end of every fiscal year for school building projects approved prior to July 1, 1996. See “School Projects” herein. 2 State of Conn ecticut, Department of Public Health. 3 U.S. Department of Commerce, Bureau of the Census, 2000: Income per Capita of $43,670 (1999).

Ratio of Annual General Fund Long-Term Debt Service Expenditures to Total General Fund Expenditures Last Ten Fiscal Years (000s) Ratio of General Total Total Fund Debt Service Fiscal Year General Fund General Fund To Total General Ended 6/30 Debt Service Expenditures Fund Expe nditures 20111 $ 23,837 $ 250,306 9.52% 2010 23,685 253,636 9.34% 2009 21,544 249,409 8.64% 2008 20,060 231,618 2 8.66% 2007 20,140 220,202 9.15% 2006 17,674 206,807 8.55% 2005 17,034 191,350 8.90% 2004 15,740 178,829 8.80% 2003 11,994 163,735 7.33% 2002 8,937 151,459 5.90% 1 Subject to audit. 2 Net of extrodinary item of State of Connecticut Teacher's Retirement on-behalf payment ($ 31.7MM).

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VI. Financial Administration

The Town's finances are operated primarily through the General Fund. Property taxes and most other revenues collected are paid into the Town's General Fund, and current operating expenditures are paid from the Town's General Fund. The Town utilizes the following major funds: the Governmental Fund, which includes the General Fund, Special Revenue Funds, Debt Service Fund, Capital Project Funds and Permanent Funds; the Proprietary Fund, which includes Internal Service Funds; and the Fiduciary Fund, which includes Pension Trust Funds and Agency Funds. Capital improvements are generally financed by the issuance of short-term bond anticipation notes and long-term serial bonds.

Fiscal Year

The Town's fiscal year begins July 1, and ends June 30.

Basis of Accounting

See Appendix A - Excerpts from the Town's Comprehensive Annual Financial Report, June 30, 2009, Note I (“Summary of Significant Accounting Policies”)

Budget Procedure

The Town has a five-step budget process:

1. The First Selectman receives and reviews budget requests from all Town departments, including the Board of Education, and then submits the recommended departmental budgets to the full Board of Selectmen.

2. The Board of Selectmen and the Board of Finance then review the budgets in a series of joint budget hearings in early March, after which the Board of Selectmen makes its recommendations on the budgets to the Board of Finance.

3. Not later than the first week in April, the Board of Finance must hold a public meeting at which it considers all matters relating to the budgets and makes its budget recommendations to the RTM.

4. The RTM holds a special meeting for public comment on the budget on the last Monday in April and votes appropriations for the next fiscal year at the annual budget meeting, which must be held the first Monday in May. In the absence of a formal appeal from a recommendation of the Board of Finance, the RTM may not appropriate an amount in excess of the Board of Finance recommendations, but may decrease such amount. A referendum may be taken on any budget item which exceeds $150,000, but no item can be increased to a figure higher than that recommended by the Board of Finance or, in the case of an appeal from the Board of Finance, the amount approved by the RTM.

5. After the RTM has made its appropriations and the report on the Grand List is received from the Board of Assessment Appeals, the Board of Finance determines the rate of property tax for the next fiscal year.

Audit

The Town of Fairfield, pursuant to local ordinance and Chapter 111 of the Connecticut General Statutes (Sections 7-391 through 7-397), as amended, is required to undergo an annual audit by an independent public accountant. The auditor, appointed by the Board of Finance, is required to conduct the audit under the guidelines promulgated by the Secretary of the Office of Policy and Management and the Auditor of Public Accounts, who also receives a copy of the audit report. For the fiscal year ended June 30, 2010, the financial statements of the various funds of the Town were audited by Kostin, Ruffkess & Company, LLC, Business Advisors and Certified Public Accountants, Farmington, Connecticut 06032. Kostin, Ruffkess & Company, LLC have not been asked nor have they given their permission to include their audit report in the Official Statement.

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Risk Management

The Town has commercial insurance coverage for Town buildings (flood, fire and casualty); errors and omissions; General Liability Umbrella Policy with a retention limit of $500,000 (amount not rounded) per incident; Law Enforcement Liability Insurance Policy with a deductible of $100,000 (amount not rounded); Worker’s Compensation Excess Policy with a retention limit of $500,000 (amount not rounded) per incident; and employee group medical claims in excess of $150,000 (amount not rounded). Otherwise, the Town is exposed to various risks for which it has retained the risk of loss, including torts; theft of, damage to, and destruction of assets; natural disaster; general liability; workers’ compensation; and employee and post- retiree group medical. The Town utilizes a risk management fund (the Internal Service Fund) to account for and finance its uninsured risks of loss. The fund records all claim expenditures and liabilities whenever it is probable that a loss has occurred and the amount of that loss can be reasonably estimated. All of the Town’s departments and agencies are charged by the Internal Service Fund, which are included in department and agency expenditures, to cover the estimated cost of claims payment based upon historical cost estimates of the amounts necessary to pay prior and current year claims. Claim liabilities include an estimate of claims incurred but not reported and are the Town’s best estimate based upon available information. For additional information regarding the Town’s risk management, see Appendix A - Excerpts from the Town's Comprehensive Annual Financial Report, June 30, 2010, Note IV. A ("Risk Management”).

Pensions

The Town administers two single-employer, contributory, defined benefit pension plans covering substantially all of the Town's employees: the Town Employees Retirement Plan and the Police and Fire Retirement Plan. Certified teachers are covered under the State of Connecticut Teachers' Retirement System. As of March 31, 2011, after losses due to the alleged Madoff Ponzi scheme (an estimated maximum loss of approximately $42,000,000, prior to any recoveries), the ending market value of the Town's composite fund was $296,280,715. For additional information regarding the Town's employee retirement systems and pension plans, see Comprehensive Annual Financial Report, June 30, 2010, Note IV. C ("Pension Plans"). In its fiscal year ended June 30, 2011, the Town made the acturalilly determined contributions to its two defined benefits plans. The Town contributed $2,886,988 to the Town Employees Retirement Plan and $43,617 to the Police and Fire Retirement Plan.

Investment Casualty Loss The Town's pension funds had investments in what was part of the estimated $65 billion dollar Ponzi scheme allegedly perpetrated by Bernie Madoff. Due to the uncertainly of the amount and likelihood of any recovery of these investments, they have been presented in the financial statement as a casualty loss. The Town is vigorously pursuing possible avenues for recovery and has hired counsel to assist them with their efforts. The Town has negotiated a settlement with three of the defendants and has received settlement funds pursuant to this litigation.

Contingency Additionally, certain limited amounts of the redemptions made by the Town from these funds might be subject to "clawback" claims by the trustee in the Madoff bankruptcy. This matter is being handled by outside counsel who has indicated that the probability of the Town being subject to these claims is unlikely. Any "clawback" would relate only to investment earnings. Were such a claim to be made, the Town would aggressively defend against it. Other Post-Employment Benefits The Town provides postretirement health care and life insurance benefits in accordance with collective bargaining agreements. Retired employees of the police and fire departments are eligible to receive health care benefits after attaining age 51 with at least 25 years of service or if the employee’s retirement was caused by disability. Other retired employees are eligible after attaining age 62 with at least 10 years of service or if the retirement was caused by disability. As of June 30, 2010, 782 retirees have met these eligibility requirements. The Town reimburses the entire amount of validated claims for medical, dental and hospitalization costs incurred by pre-Medicare retirees and their dependants. The Town also reimburses the amount by which a validated claim

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exceeds the Medicare benefit for each retiree eligible for Medicare. Certain retirees eligible for postretirement health care benefits are also entitled to postretirement life insurance benefits. Expenses for post-retirement benefits are recognized by the Town as health care claims and life insurance premiums paid. During the Fiscal Year 2009-10, expenses for postretirement health care and life insurance benefits, net of participant contributions, amounted to approximately $4,483,000. The Town has taken steps to determine its unfunded actuarial accrued liability and establish funding with respect to future post-employment benefit obligations pursuant to the Government Accounting Standards Board’s Statement 45. The Town has established two trusts and has began funding its actuarially accrued liability ($136,286,000). For additional information regarding the Town’s other post-employment benefits, see Appendix A - Excerpts from the Town's Comprehensive Annual Financial Report, June 30, 2010, Note IV. E ("Other Postemployment Benefits”). Investment of Operating Funds

Eligible investments for Connecticut municipalities are governed by the Connecticut General Statues, Section 7- 400. As of June 30, 2010, the Town was invested in Certificates of Deposit, Pooled Fixed Income, U.S. Government Obligations, Government Agency Funds, U.S. Government Mutual Fund, Fixed Income Mutual Funds and Corporate Bonds . For additional information regarding the Town’s investments, see Comprehensive Annual Financial Report, June 30, 2010, Note III. A ("Cash and Investments”).

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General Fund Revenues and Expenditures Three Year Summary of Audited Revenues and Expenditures (GAAP Basis), With Estimated Actuals and Adopted Budget (Budgetary Basis) (000s)

Budget Est. Actual Actual Actual Actual 11 Revenues: 2012 2011 2010 2009 2008 Property Taxes ……………………………………… $ 239,626 $ 228,935 $ 224,354 $ 218,781 $ 202,652 Intergovernmental Revenues ……………………… 8,727 8,773 20,383 20,508 46,5422 Charges for Services ……………………………… 13,181 12,561 12,634 12,132 14,225 Income from Investments ………………………… 1,320 850 861 1,282 2,509 Other ……………………………………………… 220 687 332 144 224 Total Revenues ………………………… 263,074 251,806 258,564 252,847 266,152

Expenditures: General Government ……………………………… 24,017 18,989 16,464 15,335 12,242 Finance …………………………………………… 4,445 4,575 4,487 3,579 3,385 Public Safety ……………………………………… 32,589 31,551 29,996 29,227 28,456 Pu blic Works ……………………………………… 16,499 15,646 13,631 14,395 14,888 Health & Welfare ………………………………… 7,379 6,966 7,011 7,280 7,887 Culture & Recreation ……………………………… 7,595 7,196 6,889 7,038 7,144 Education ………………………………………… 145,680 141,546 151,473 151,011 169,3042 Debt Service ……………………………………… 24,870 23,837 23,685 21,544 20,060 Total Expenditures ………………………… 263,074 250,306 253,636 249,409 263,366

E xcess (Defi ciency) of Revenues Over Expenditures ………………………… N/A 1,500 4,928 3,438 2,786

Other Financing Sources (Uses): Operating Transfers in …………………………… N/A - 394 269 463 Operating Transfers out …………………………… N/A - (3,177) (4,028) (3,911) Net Other Financing Sources (Uses) ……… N/A - (2,783) (3,759) (3,448)

E xcess (Defi ciency) of Revenues and Other Financing Sources Over Exps. and Other Financing Uses ………… N/A 1,500 2,145 (321) (662)

Fund Balance, July 1 …………………………… N/A 13,362 11,217 11,538 12,200 Residual Equity Transfers ……………… …… - - - - - Fund Balance, End of Year …………………… N/A $ 14,862 $ 13,362 $ 11,217 $ 11,538

Budget Est. Actual Actual Actual Actual 20121 20111 2010 2009 2008 Reserved for Encumbrances ……………………… N/A $ 1,000 $ 1,076 $ 954 $ 1,989 Unreserved: Designated for Reappropriations …………………… N/A - - - - Designated for Subsequent Year ………………… N/A - - - 500 Undesignated ……………………………………… N/A 13,786 12,286 10,263 9,049 Total Fund Equity ……………………………… N/A $ 14,786 $ 13,362 $ 11,217 $ 11,538 1 Subject to audit. 2 Includes extrodinary item of State of Connecticut Teacher's Retirement on-behalf payment ($31.7MM).

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VII. Legal and Other Information

Legal Matters Pullman & Comley, LLC is serving as Bond Counsel with respect to the authorization and issuance of the Notes and will render its opinion in substantially the form attached hereto as Appendix B.

Litigation In the opinion of the Town Attorney, there are no claims or litigation pending or to his knowledge threatened, which would individually or in the aggregate result in a final judgment or judgments against the Town which would have a material adverse effect on the finances of the Town or which would impact the validity of the Notes or the power of the Town to levy and collect taxes to pay the principal of and interest on the Notes.

Documents Furnished At Delivery The original purchaser(s) of the Notes will be furnished the following documentation when the Notes are delivered:

1. A Signature and No Litigation Certificate stating that at the time of delivery no litigation is pending or threatened affecting the validity of the Notes or the levy or collection of taxes to pay them. 2. A Certificate on behalf of the Town, signed by the First Selectman and Fiscal Officer which will be dated the date of delivery, which will certify, to the best of said officials' knowledge and belief, that at the time bids on the Notes were accepted the descriptions and statements in the Official Statement relating to the Town and its finances were true and correct in all material respects and did not contain any untrue statement of a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, and that there has been no material adverse change in the financial condition of the Town from that set forth in or contemplated by the Official Statement. 3. A receipt for the purchase price of the Notes. 4. The approving opinion of Pullman & Comley, LLC, Bond Counsel, of Bridgeport, Connecticut, substantially in the forms of Appendix B attached hereto. 5. An executed Continuing Disclosure Agreement for the Notes in substantially the forms of Appendix C attached hereto. 6. A record of the proceedings taken by the Town in authorizing the Notes will be kept on file at offices of U.S. Bank National Association, Hartford, Connecticut, and may be examined upon reasonable request.

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Concluding Statement

This Official Statement is not to be construed as a contract or agreement between the Town and the purchaser or holders of the Notes. Any statements made in this Official Statement involving matters of opinion or estimates are not intended to be representation of fact, and no representation is made that any of such opinion or estimate will be realized. No representation is made that past experience, as might be shown by financial or other information herein, will necessarily continue or be repeated in the future. Neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the Town since the date hereof. References to statutes, charters, or other laws herein may not be complete and such provisions of law are subject to repeal or amendment. Information herein has been derived by the Town from official and other sources and is believed by the Town to be reliable, but such information other than that obtained from official records of the Town has not been independently confirmed or verified by the Town and its accuracy is not guaranteed. This Official Statement has been duly prepared and delivered by the Town, and executed for and on behalf of the Town by the following officials:

Town of Fairfield, Connecticut

By: /S/ Michael C. Tetreau By: /S/ Paul H Hiller MICHAEL C. TETREAU, First Selectman PAUL H. HILLER, JR., Fiscal Officer

July 14, 2011

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Appendix A

Excerpts from the Town’s Comprehensive Annual Financial Report For Fiscal Year Ending June 30, 2010

The following includes excerpts from the Comprehensive Annual Financial Report of the Town of Fairfield, Connecticut for the fiscal year ended June 30, 2010. The supplemental data which was a part of the report has not been reproduced herein. A copy of the complete report is available upon request from Matthew A. Spoerndle, Managing Director, Phoenix Advisors, 53 River Street, Suite 3, Milford, Connecticut 06460. Telephone (203) 878- 4945.

(This page intentionally left blank) ; Pond View Corporate Center KOSTIN, Farmington, CT New London, CT 1 76 Park Road Springfield, MA .ET Farmington, CT 06032-2571 R_UH-~KESS . Main Line: (860) 678-6000 & COMPANY;LLC t Toll Free: (800) 286-KRCO Business Advisors and Certified Public Accountants E Fax: (860) 678-611 0 Web: www.kostin.com

INDEPENDENT AUDITORS' REPORT

Board of Finance Town of Fairfield, Connecticut

We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Town of Fairfield, Connecticut, as of and for the year ended June 30, 2010, which collectively comprise the Town's basic financial statements as listed in the table of contents. These basic financial statements are the responsibility of the Town's management. 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 fmancial 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 basic financial statements are fiee of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the basic financial statements. An audit also includes assessing the accounting principles used and the significant estimates made by management, as well as evaluating the overall basic financial statement presentation. We believe that our audit provides a reasonable basis for our opinions.

In our opinion, the fmancial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the Town of Fairfield, Connecticut, as of June 30,2010, and the respective changes in financial position and cash flows, where applicable, thereof and the respective budgetary comparison for the general fund for the year then ended in conformity with accounting principles generally accepted in the United States of America.

In accordance with Government Auditing; Standards, we have also issued our report dated December 23, 2010, on our consideration of the Town's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing; Standards and should be considered in assessing the results of our audit .

The Management Discussion and Analysis and Schedules of Funding Progress and Employer Contributions - Fairfield Retirement System and Other Post-Employment Plans on pages 9 through 16 and pages 61 through 63, respectively, are not a required part of the basic financial statements but are supplemental information required by Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplemental information. However, we did not audit the information and express no opinion on it.

Members ofi Leading Edge Alllance . Kreston International . American Institute of Certified Public Accountants An Equal Opporlunlly Employer Board of Finance Town of Fairfield, Connecticut Page Two

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Town of Fairfield, Connecticut's basic financial statements. The accompanying financial information listed as supplemental schedules in the table of contents is presented for purposes of additional analysis and is not a required part of the basic financial statements. The combining fund financial statements and other schedules as listed in the table of contents have been subjected to the auditing procedures applied in the audit of the basic fmcial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. The introductory section and statistical section have not been subject to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we express no opinion on them.

Farmington, Connecticut December 23,2010 SdHvan Independence Hall Fairfield, Comecticut 06430 725 Old Post Road Finance Department

MANAGEMENT'S DISCUSSION AND ANALYSIS JUNE 30,2010 (THOUSANDS)

As management of the Town of Fairfield, Connecticut, we offer readers of the Town of Fairfield's financial statements this narrative overview and analysis of the financial activities of the Town for the fiscal year ended June 30,2010. The amounts presented are in thousands.

Financial Highlights . . 0 The assets of the Town exceeded its liabilities at the close of the most recent fiscal year by $251,633 (net assets). Unrestricted net assets, the amount that may be used to meet the Town's ongoing obligations to citizens and creditors, was $1,3 15 at June 30,2010.

The Town's total net assets increased by $6,737. The increase was attributable to refunding of long-term debt, as well as increased investment holdings and an increase in buiiding capital assets.

0 As of the close of the current fiscal year, the Town's governmental funds reported combined ending fund balances of $6,935, an increase of $4,829 in comparison with the prior year. The increase was due substantially to a decrease in liabilities for due to other funds and an increase in cash and investment holdings.

0 At the end of the current fiscal year, unreserved and undesignated fund balance for the general fund was $12,286 or 4.79% of total general fund expenditures and other financing uses. This figure represents a 19.71% increase over the previous fiscal year.

The Town of Fairfield's total bondnote debt decreased by a net of $7,031 (3.31%) during the current fiscal year due to principal payments made during the year, in addition to a current year refunding, net of bond proceeds of $19,410, and bond anticipation notes permanently financed of $10,105.

Overview of the Basic Financial Statements

This discussion and analysis is intended to serve as an introduction to the Town of Fairfield's basic financial statements. The Town's basic financial statements comprise three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the basic financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves.

Government-wide financial statements. The government-wide financial statements are designed to provide - . readers with a broad overview of the Town's finances, in a manner similar to a private-sector business.

The statement of net assets presents information on all of the Town's assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the Town is improving or deteriorating. MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED)

The statement of activities presents information showing how the Town's net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave).

The government-wide financial statements present the functions of the Town that are principally supported by taxes and intergovernmental revenues (governmental activities). The governmental activities of the Town include general government, finance, public safety, public works, health and welfare, culture and recreation, education and interest expense.

Fund financial statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The Town uses fund accounting to ensure and demonstrate compliance with fmance-related legal requirements. All of the funds of the Town can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds.

Governmental funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a Town's near-term financing requirements.

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 sirnilar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the Town's near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.

The Town maintains 19 individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures and changes in fund balances for the General Fund and Capital Projects Fund, both of which are considered to be major funds. Data from the other 17 governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements elsewhere in this report.

The Town adopts an annual budget for its General Fund. A budgetary comparison statement has been provided for the general fund to demonstrate compliance with this budget.

Proprietary fund. The Town maintains one proprietary fund. Internal service funds are an accounting device used to accumulate and allocate costs internally among the Town's various functions. The Town uses an internal service fund to account for its self-insured medical benefits and various other self-insured risks. Because these services predominantly benefit governmental functions, they have been included within governmental activities in the government-wide financial statements.

The data for the internal service fund is provided in Exhibits G, H, and I of this report.

Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support the Town's own programs. The accounting used for fiduciary funds is much like that used for proprietary funds. MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED)

Notes to the basic 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. In addition to the basic financial statements and accompany,ing notes, this report also presents certain required supplementary information concerning the Town's progress in funding its obligation to provide pension benefits to its employees. Required supplementary information can be found following the notes. The combining statements referred to earlier in connection with nonmajor governmental funds are presented immediately following the required supplementary information on pensions. Government-Wide Financial Analssis As noted earlier, net assets may serve over time as a useful indicator of a town's financial position. In the case of the Town, assets exceeded liabilities by $25 1,879 at the close of the most recent fiscal year. By far the largest portion of the Town's net assets (99.21%) reflects its investment in capital assets (e.g., land, buildings, machinery, equipment and infrastructure), less any related debt used to acquire those assets that are still outstanding. The Town uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the Town'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 fiom other sources, since the capital assets themselves cannot be used to liquidate these liabilities.

TOWOF FAIRFIELD SUMMARY STATEMENT OF NET ASSETS JUNE 30,2010 (THOUSANDS)

Current and other assets...... $ 68,403 $ 64,184 Capital assets (net)...... 468,523 466,142

TOTAL ASSETS...... 536,926 530,326

Long-term liabilities outstanding...... 217,521 215,759 Other liabilities...... 67,772 69,671

TOTAL LMILITIES...... 285,293 285,430',

Net assets: Invested in capital assets, net of related debt ...... 249,899 240,836 Restricted...... 419 379 Unrestricted...... 1,315 . 3,681

TOTAL NET ASSETS......

An additional portion of the Town's net assets of $419 represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net assets is $1,315. . MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED) The Town's net assets increased by $6. 737 during-the current fiscal year . Most of this increase is due to the construction activity related to the various school construction projects .

TOWN OF FAIRFIELD CEL4NGES IN NET ASSETS (THOUSANDS)

REVENUES: Program revenues: Charges for services ...... Operating grants and contributions ...... Capital grants and contributions ...... General revenues: . Property taxes ...... Grants and contributions not restricted to specific programs ...... Investment income...... Miscellaneous ......

TOTAL REVENUES ...... 2'78. 948 271. 226

EXPENSES: General government...... Finance ...... Public safety...... Public works ...... Health and welfare ...... Culture and recreation ...... Education ...... Interest expense ......

TOTAL EXPENSES ...... 272. 211 263. 938

. ~ ... CHANGE IN NET ASSETS ......

NET ASSETS .JULY 1...... 244. 896 237. 608

NET ASSET .JUNE 30 ...... $ 251. 633 $ 244. 896 MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED)

Property taxes increased by $4,187 during the year due to the increase in the demand for services adopted in the 20 10 expenditure budget.

Operating grants and contributions increased by $2,568 primarily due increased state education grant funding for both regular and special education.

General government expenses decreased by $5,037 due primarily to a decrease in human resource expenditures.

Public works expenses increased by $3,970 due to significant amount of asphalt paving expenditures necessary.

Education expenses increased by $9,235 as a result of an increase in educational grant funding.

Financial Analysis of the Town's Funds

As noted earlier, the Town uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.

Governntental funds. The focus of the Town's governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the Town's financing requirements. In particular, unreserved fund balance may serve as a useful measure of a Town's net resources available for spending at the end of the fiscal year.

As of the end of the current fiscal year, the Town's governmental funds reported combined ending fund balances of $6,935, an increase of $4,829 in comparison with the prior year. The fund balance is reserved to indicate that it is not available for new spending because it has already been committed (1) to liquidate contracts and purchase orders of the prior period $1,087, (2) debt service $408, (3) endowments $70 and (4) commitments $12,404.

The general fund is the operating fund of the Town. At the end of the current fiscal year, unreserved and undesignated fund balance of the general fund was $12,286, while total fund balance was $13,362. As a measure of the general fund's liquidity, it may be useful to compare both unreserved fund balance and total fund balance to total fund expenditures. Unreserved and undesignated fund balance represents 4.79% of total general fund expenditures, while total fund balance represents 5.21% of that same amount.

Capital Projects Funds have intergovernmental revenue of $887 during the year related to the school construction grants and transfers in of $2,908. Expenditures totaled $11,219. There was $19,410 of refunding debt issued related to the school construction projects, and payments to refunded bond escrow agent of $22,576. The fund balance increased from $(I 1,693) to $(10,055) at June 30,2010.

Proprietary fund. Unrestricted net assets of the Internal Service Fund at the end of the year amounted to $(5,921), a decrease of $944 from the balance at June 30,2009 of $(4,977). This change was substantially due to contributions to the Town and Police and Fire OPEB Trust Funds and increases in Workers' Compensation liability. MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED)

General Fund Budgetary Highlights

Differences between the original budget and the final amended budget were not significant ($210) and were funded from revised revenue appropriations. Significant budgetary variances were as follows:

Investment income was under budget by $618 due to a decrease in fair value of certain investments, and decrease in investible amount and the decrease in interest rates over the prior year levels.

Charges for services was under budget by $665 due to reduced revenue in building permits as a result of,the slow housing market.

0 Public works expenditures were under budget by $498 due to unfilled vacancies within the Public'Works Department and savings achieved through energy conservation measures

Culture and recreation was under budget by $31 1 due to reductions in library and golf course expenditures.

Health and welfare was under budget by $882 due primarily to reduced tonnage received at the Solid Waste Transfer Facility.

Capital Assets and Debt Administration

Capital assets. The Town's investment in capital assets for its governmental activities as of June 30, 2010, amounts to $468,523 (net of accumulated depreciation). This investment in capital assets includes land, land improvements, buildings, building improvements, machinery and equipment, vehicles, intangible assets and infrastructure. The increase in the Town's net capital assets for the current fiscal year was $2,381 or .51%.

Major capital asset events during the current fiscal year included the following:

Construction in progress increased by $8,618 primarily due to an increase in school construction costs.

0 Intangible assets totaled $417 for cost of MUNIS soilmare.

0 Buildings decreased by $7,216 as a result of annual depreciation expense net with additions of $1,236. MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED)

TOWN OF FAIJXFIELD CAPITAL ASSETS - NET (THOUSANDS)

Land ...... $ 37,518 $ 37,508 Assets held for resale...... 909 909 Construction in progress...... 33,159 24,541 Buildings...... 330,789 338,005 Furniture and equipment...... 7,696 7,145 Vehicles...... 3,557 3,624 Intangible assets...... 417 - Infrastructure...... 54,478 54,410

TOTAL...... $ 468,523 $ 466,142

Additional information on the Town's capital assets can be found in Note III. C.

Long-term debt. At the end of the current fiscal year, the Town had total bonds and notes outstanding of $205,307. All of this amount comprises debt backed by the full faith and credit of the Town. This debt will be partially retired by $2,028 in State of Connecticut grants for school building projects. Town of Fairfield. Connecticut

Governmental Activities General Obligation BondslNotes

General obligation bonds...... $ 174,470 $ 189,970 Clean Water notes payable...... 20,732 22,368 Bond anticipation notes...... 10,105

Total ...... $ 205.307 $ 212.338

The Town's total debt decreased by $7,018 (3.31%) during the current fiscal year due to the issuance of $19,410 of refunding bonds, and $1 0,105 of bond anticipation notes permanently financed, net of $1 5,181 in scheduled principal payments.

The Town's short-term debt decreased flom $15,485 to $15,285 during the year due to the issuance of bond anticipation notes related to the school construction projects, of which a portion was permanently financed.

Moody's, Standard and Poor's, and Fitch Ratings continue to express the highest levels of confidence in the Town, its management and its ability to manage an increasing debt burden by all awarding their highest AAA rating to Fairfield. In fact, Standard and Poor's in their annual review of AAA municipalities throughout the nation highlighted and praised Fairfield. MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED)

State statutes limit the amount of general obligation debt a governmental entity may issue to 7 times total tax collections including interest and lien fees and the tax relief for elderly fieeze grant. The current debt limitation for the Town is $1,570,037, which is significantly in excess of the Town's outstanding general obligation debt.

Additional information on the Town's long-term debt can be found in Note III. F

Economic Factors and Next Year's Budgets and Rates

The unemployment rate for the Town as of June 2010 was 7.5%, which is an increase fiom last year of 6.7%. This is comparable to the state's average unemployment rate of 9.1%.

Inflationary trends in the region compare favorably to national indices.

Further increases in public school population.

All of these factors were considered in preparing the Town's budget for the 201 1 fiscal year.

During the current fiscal year, unreserved fund balance in the general fund increased to $12,286.

Requests for Information

This financial report is designed to provide a general overview of the Town's finances for all those with an interest in the government's finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Finance Department, Town of Fairfield, Independence Hall, 725 Old Post Road, Fairfield, Connecticut 06430. Basic Financial Statements STATEMENT OF NET ASSETS JUNE 30,2010 (THOUSANDS)

GOVERNMENTAL ACTMTIES

Current assets: Cash ...... Investments...... Receivables: Property taxes...... Assessments...... Intergovernmental...... Loan...... Other...... Other assets......

Total current assets......

Noncurrent assets:

Restricted assets: Temporarily restricted investments...... Permanently restricted investments......

Total restricted assets......

Receivables (net): Property taxes...... Assessments ...... Intergovernmental ...... Loan......

Total receivables (net)...... Other noncurrent assets: Net pension asset...... Other......

Total other noncurrent assets...... Capital assets (net of accumulated depreciation): Land...... Assets held for resale...... Construction in progress...... Buildings and improvements...... Vehicles...... Machinery and equipment...... Intangible assets (net of accumulated amortization)...... Infrastructure......

Total capital assets (net of accumulated depreciation)......

Total noncurrent assets......

TOTAL ASSETS ...... 536,926 (Continued)

The notes to the financial statements are an integral part of this statement. 17 EXHIBIT A (2 of 2)

STATEMENT OF NET ASSETS JUNE 30. 2010 (THOUSANDS)

GOVERNMENTAL, ACTIVITIES

LIABILITIES

LIABILITIES: Current liabilities: Accounts payable ...... Accrued payroll and related liabilities ...... Accrued interest payable ...... Unearned revenue ...... Bond anticipation notes ...... Other ...... Bonds and notes payable ...... Compensated absences ...... Heart and hypertension ...... Risk management ......

Total current liabilities ......

Noncurrent liabilities: Bonds and notes payable ...... Compensated absences ...... Heart and hypertension ...... Net OPEB obligation ...... Risk management ......

Total noncurrent liabilities ......

TOTAL LIABILITIES......

NET ASSETS

Invested in capital assets. net of related debt ...... Restricted for: Endowments: Nonexpendable ...... Expendable ...... Unrestricted ......

TOTAL NET ASSETS ......

(Concluded)

The notes to the financial statements are an integral part of this statement . 18 EXHIBIT B

STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30. 20 10 (THOUSANDS)

NET EXPENSES AND CHANGES IN PROGRAM REVENUES NET ASSETS

OPERATING CAPITAL TOTAL CHARGES FOR GRANTS AND GRANTS AND GOVERNMENTAL FUNCTIONSR ROGRAMS EXPENSES SERVICES CONTRIBUTIONS CONTRIBUTIONS ACTIVITIES

GOVERNMENTAL ACTIVITIES: General government...... $ 10. 828 $ 4. 055 $ $ $ (6. 773) Finance ...... 798 29 (769) Public safety...... 33. 803 5. 441 884 (27. 478) Public works ...... 24. 116 5. 184 192 887 (17. 853) Health and welfare ...... 8. 214 191 666 (7. 357) Culture and recreation...... 8. 63 1 4. 443 216 (3. 972) \ \o Education ...... 177. 078 4. 00 1 23. 259 (149. 818) Interest expense ...... 8. 743 (8. 743)

TOTAL GOVERNMENTAL ACTIVITIES .....

GENERAL REVENUES: Property taxes ...... Grants and contributions not restricted to specific programs ...... Investment income ...... Miscellaneous......

TOTAL GENERAL REVENUES......

CHANGE IN NET ASSETS ......

NET ASSETS -JULY 1. 2009 ......

NET ASSETS .JULY 1. 2010 ......

The notes to the financial statements are an integral part of this statement. EXHIBIT C (1 of 2)

BALANCE SHEET GOVERNMF,NTAL FUNDS JUNF. 30. 2010 (THOUSANDS)

OTHER TOTAL CAPITAL GOVERNMENTAL GOVERNMENTAL GENERAL PROJECTS FUNDS FUNDS

ASSETS

Cash ...... Investments ...... Receivables. net: Property taxes...... Sewer. beach and sidewalk assessments...... Intergovernmental...... Loan ......

Due from other funds...... Other ......

TOTAL ASSETS ......

LIABILITIES AND FUND BALANCES

Liabilities: Accounts payable ...... Accrued payroll ...... Due to other funds ...... Defened revenue ...... Bond anticipation notes ...... Performance bonds ...... Other......

Total Liabilities......

Fund Balances: Reserved for: Encumbrances...... Debt service fund ...... Endowments ...... Commitments...... Unreserved, reported in: General fund ...... Special revenue funds ...... Capital project fund ...... Permanent funds......

Total Fund Balances ...... 13.362 (10. 055) 3. 628 6. 935

TOTAL LIABILITIES AND FUND BALANCES ...... $ 42. 061 $ 9. 28 1 $ 8. 845 $ 60. 187

(Continued)

The notes to the financial statements are an integral part of this statement . 20 EXHIBIT C (2 of 2)

RECONCILIATION OF FUND BALANCE TO NET ASSETS OF GOVERNMENTAL ACTIVITIES JUNE 30,2010 (THOUSANDS)

AMOUNTS REPORTED FOR GOVERNMENTAL ACTIVITIES IN THE STATEMENT OF NET ASSETS (EXHIBIT A) ARE DIFFERENT FROM THE GOVERNMENTAL FUND BALANCE SHEET. THE DETAILS OF THIS DIFFERENCE ARE AS FOLLOWS:

TOTAL FUND BALANCE (EXHIBIT C, PAGE 1)...... $ 6,935

CAPITAL ASSETS USED IN GOVERNMENTAL ACTIVITIES ARE NOT FINANCIAL RESOURCES AND, THEREFORE, ARE NOT REPORTED IN THE FUNDS:

Beginning capital assets...... Current capital asset additions...... Depreciation expense...... Disposal and sale of capital assets......

OTHER LONG-TERM ASSETS ARE NOT AVAILABLE TO PAY FOR CURRENT PERIOD EXPENDITURES AND, THEREFORE, ARE DEFERRED IN THE FUNDS:

Property tax and sewer assessment interest and lien accrual...... Property tax, sewer assessment, and community development block grant receivable - accrual basis change...... Allowance for doubtful accounts...... School building grant receivable...... Net pension asset...... Other......

INTERNAL SERVICE FUNDS ARE USED BY MANAGEMENT TO CHARGE THE COST OF MEDICAL INSURANCE PREMIUMS TO INDIVIDUAL DEPARTMENTS:

The assets and liabilities of the internal service funds are included in governmental activities in the statement of net assets......

SOME LIABILITIES, INCLUDING BONDS PAYABLE, ARE NOT DUE AND PAYABLE IN THE CURRENT PERIOD AND, THEREFORE, ARE NOT REPORTED IN THE FUNDS:

Bonds and notes payable ...... (205,307) Deferred charge on refunding...... 3,643 Bond premium...... (6,591) Compensated absences...... (3,726) Heart and hypertension...... (904) Net OPEB obligation...... (1 3,928) Accrued interest payable...... (3,745)

NET ASSETS OF GOVERNMENTAL ACTIVITIES......

(Concluded)

The notes to the financial statements are an integral part of this statement. 21 EXHIBIT D

STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS FORTHE YEAR ENDED JUNE 30. 2010 (THOUSANDS)

OTHER TOTAL CAPITAL GOVERNMENTAL GOVERNMENTAL GENERAL PROJECTS FUNDS FUNDS

REVENUES: Property taxes...... Intergovernmental...... Charges for services...... Income from investments...... Contributions......

TOTAL REVENUES ......

EXPENDITURES: Current: General government...... Finance...... Public safety...... Public works ...... Health and welfare...... Culture and recreation...... Education ...... Capital outlay...... Debt service......

TOTAL EXPENDITURES......

EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES ......

OTHER FINANCING SOURCES (USES): Issuance of debt...... Issuance of refunding debt...... Payment to refunded bond escrow agent ...... Premium ...... Transfers in ...... Transfers out ......

NET OTHER FINANCING SOURCES (USES)......

NET CHANGE IN FUND BALANCES ......

FUND BALANCES -JULY 1. 2009 ......

FUND BALANCES .JUNE 30. 2010 ......

The notes to the financial statements are an integral part of this statement. 22 RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30,20 10 (THOUSANDS)

AMOUNTS REPORTED FOR GOVERNMENTAL ACTIVITIES IN THE STATEMENT OF ACTIVITIES (EXHIBIT B) ARE DUE TO:

NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FUN'DS (EXHIBIT D)......

Governmental funds report capital outlays as expenditures. However, in the Statement of Activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlays exceeded depreciation in the current period:

Capital outlay ...... Donated capital assets ...... Depreciation expense......

Total......

The net effect of various miscellaneous transactions involving capital assets (i. e., sales, trade-ins and donations) is to increase net assets. In the Statement of Activities, only the lorn the sale of capital assets is reported. However, in the governmental funds, the proceeds from the sale increase financial resources. Thus, the change in net assets differs from the change in fund balance by the cost of the capital assets sold ......

Revenues in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds and revenues recognized in the Fund Financial Statements are not recognized in the statement of activities:

School building grant receipts...... Change in property tax, sewer assessment, and community development block grant receivable - accrual basis change...... Change in property tax and sewer assessment interest and lien revenue......

Total ......

The issuance of long-term debt (e.g., bonds, leases) provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net assets. Also, governmental funds report the effect of issuance costs, premiums, discounts, and similar items when debt is first issued, whereas these amounts are deferred and amortized in the Statement of Activities. The details of these differences in the treatment of long-term debt and related items are as follows:

Debt issued or incurred: General obligation bonds and related...... Bond premium ...... Deferred charges ...... Other...... Principal repayments: General obligation bonds ...... Capital lease payable......

Total ......

(Continued)

The notes to the financial statements are an integral part of this statement. 23 EXHIBIT E (2 of 2)

RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL ELTNDS TO STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30,201 0 (THOUSANDS)

Some expenses reported in the Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds:

Compensated absences ...... $ (110) Heart and hypertension...... 9 Net pension obligation (asset)...... (130) Net OPEB obligation ...... (4,001) Accrued interest payable...... 378

Total ...... (3,854)

Internal Service Funds are used by management to charge costs of various self-insured risk premiums to individual departments...... (944)

CHANGE IN NET ASSETS OF GOVERNMENTAL ACTIVITIES @XHIBIT B) ...... $ 6,737

(Concluded)

The notes to the financial statements are an integral part of this statement. 24 EXHIBIT F

GErnRAL FUND STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL FORTHEYEARENDED JUNE 30. 2010 (THOUSANDS)

VARIANCE WITH ORIGINAL FINAL FINAL BUDGET BUDGET ACTUAL BUDGET

Property taxes ...... $ 222. 567 $ 222. 567 $ 224. 354 $ 1. 787 Intergovernmental...... 9. 05 1 9. 126 8. 529 (597) Charges for services ...... 13.299 13.299 12. 634 (665) Income from investments ...... 1.479 1.479 861 (618) Other ...... 500 500 332 (168)

TOTAL REVENUES ...... 246. 896 246. 971 246. 710 (261)

EXPENDITURES:

Current: General government...... Finance...... Public safety ...... Public works ...... Health and welfare ...... Culture and recreation ...... Education ...... Debt service......

TOTAL EXPENDITURES ......

EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES ......

OTHER FINANCING SOURCES (USES): Appropriation of fund balance...... 135 (135) Cancellation of prior year encumbrances...... 162 162 Transfers in ...... 349 349 394 45 Transfers out ...... (3. 177) (3. 177) (3. 177)

NET OTHER FINANCING SOURCES (USES)...... (2. 828) (2. 693) (2. 621) 72

NET CHANGE IN FUND BALANCES...... $ $ 2. 023 $ 2. 023

FUND BALANCE -JULY 1. 2009 ......

FUND BALANCE .JUNE 30. 2010 ......

The notes to the financial statements are an integral part of this statement . 25 EXHIBIT G

STATEMENT OF NET ASSETS PROPRETARY FUNDS JUNE 30,2010 (THOUSANDS)

GOVERNMENTAL ACTIVITIES

INTERNAL SERVICE FUNDS

ASSETS

Investments ...... Receivables......

TOTAL ASSETS......

LIABILITIES

Current liabilities: Accounts payable...... Claims payable...... Deferred revenue...... Due to other funds......

Total current liabilities......

Noncurrent liability: Claims payable ......

TOTAL LIABILITIES......

NET ASSETS

Unrestricted......

The notes to the tinancia1 statements are an integral part of this statement. 26 EXHIBIT H

STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30,2010 (THOUSANDS)

GOVERNMENTAL ACTMTIES

INTERNAL SERVICE FUNDS

OPERATING REVENUES: Charges for services......

OPERATING EXPENSES: Claims incurred ...... Administration......

TOTAL OPERATING EXPENSES...... 35,774

OPERATING INCOME (LOSS) ...... (1,137)

TRANSFERS IN ...... 193

NET INCOME (LOSS)...... (944)

TOTAL NET ASSETS - JULY 1, 2009...... (4,977)

TOTAL NET ASSETS - JUNE 30, 20 10......

The notes to the financial statements are an integral part of this statement. 27 EXHIBIT I

STATEMENT OF CASH FLOWS PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30,2010 (THOUSANDS)

GOVERNMENTAL ACTIVITIES

INTERNAL SERVICE FUNDS

CASH FLOWS FROM OPERATING ACTIVITIES: Cash received for charges for services...... Cash paid for benefits and claims...... Cash paid for administration......

NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES ...... 465

CASH FLOWS FROM NONCAPTIAL ACTIVITIES: Transfers from other funds ......

CASH FLOWS FROM INVESTING ACTIVITIES: Sale of investments......

NET CHANGE IN CASH......

CASH - JULY 1, 2009......

CASH - JUNE 30,2010 ...... $

RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:

Operating income (loss) ......

Adjustments to reconcile operating income (loss) to net cash provided by (used in) operating activities: (Increase) decrease in: Receivables...... Increase (decrease) in: Accounts and other payables ...... Deferred revenue...... Due to other funds ......

NET CASH PROVIDED BY (USED IN) OPERATING ACTMTIES ......

The notes to the £inancia1 statements are an integral part of this statement. 28 STATEMENT OF FIDUCIARY NET ASSETS FIDUCIARY FUNDS JUNE 30. 2010 (THOUSANDS)

OTHER POST- EMPLOYMENT PENSION BENEFIT AGENCY TRUST FUNDS TRUST FUNDS FUNDS

ASSETS

Cash ...... $ $ $ 824

Investments at fair value: Money market ...... Certificates of deposit ...... Corporate bonds ...... U.S. Government obligations ...... U.S. Government agency obligations ...... Municipal obligations ...... Hedge funds ...... Real estate ...... Mortgage backed securities ...... Common stock ...... Mutual funds: Equities ...... Bond ...... Foreign currency ...... U.S. government agency ......

Total Investments ...... 252. 036 6. 214 61

Receivables: Interest and dividends ...... 635 161

Due from other funds ...... 543

TOTAL ASSETS ...... 253. 214 6. 375 885

LIABILITIES

LIABILITIES: Accounts payable ...... 885 Due to other funds...... , ...... 346 1. 195 Claims payable ...... 357

TOTAL LIABILITIES ...... 346 1,552 885

NET ASSETS

NET ASSETS HELD IN TRUST FOR PENSION AND OTHER POST-EMPLOYMENT BENEFITS ...... $ 252. 868 $ 4. 823 $

The notes to the financial statements are an integral part of this statement. EXHIBIT K

TOWN OF FATRFELR. CONNECTICIJT

STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS FIDUCIARY FUNDS FOR THE YEAR ENDED JUNE 30,20 10 (THOUSANDS)

OTHER POST- EMPLOYMENT PENSION BENEFIT TRUST TRUST FUNDS FUNDS

ADDITIONS: Contributions: Employer ...... $ 1,569 $ 5,803 Plan members..; ...... 1,324 707

Total contributions...... 2,893 6,510

Investment income: Change in fair value of investments...... 17,498 276 Recoveries (Madoff)...... 1,000 Interest and dividends...... 5,580

Total investment income (loss)...... 24,078 276

Less investment expenses...... 90 1

Net investment income (loss)...... 23,177 276

TOTAL ADDITIONS......

DEDUCTIONS: Benefits...... Recovery expenses (Madoff) ...... Administration......

TOTAL DEDUCTIONS ...... : ......

CHANGES IN NET ASSETS......

NET ASSETS - JULY 1,2009......

NET ASSETS - JUNE 30, 2010 ......

The notes to the financial statements are an integral part of this statement.

30 NOTES TO BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30,2010 (AMOUNTS EXPRESSED IN THOUSANDS)

HISTORY AND ORGANIZA TION

The Town of Fairfield (the "Town") operates under a Representative Town Meeting (RTM) Board of Selectman, Board of Finance, form of government and provides the following public services as authorized by its charter: public safety (police and fire), public works, health and social services, culture- recreation, education, and general administrative services.

L SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. Government-Wide and Fund Financial Statements

The government-wide financial statements (i.e., the statement of net assets and the statement of changes in net assets) report information on all of the nonfiduciary activities of the Town. For the most part, the effect of interfbnd activity has been removed from these statements. Governmental activities are normally supported by taxes and intergovernmental revenues.

The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment, and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues.

Separate financial statements are provided for governmental, proprietary and fiduciary funds, even though the latter are excluded fiom the government-wide financial statements. Major individual governmental funds are reported as separate columns in the fund financial statements.

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

The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund and fiduciary fund financial statements. Agency funds have no measurement focus but are accounted for using the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenues as soon as all eligibility requirements imposed by the provider have been met.

Governmental fund financial statements are reported using the currentfinancial resources measurement focus and the modij?ed accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the Town considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. TOWOF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

I. SWRYOF SIGMFICXNT ACCOUNTING POLICIES (CONTINUED)

B. Measurement Focus, Basis of account in^, and Financial Statement Presentation (Continued)

Property taxes, expenditure reimbursement type grants, certain intergovernmental revenues, transfers, and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the Town.

The Town reports the following major governmental funds:

The General Fund is the government's primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund.

The Capital Projects Fund accounts for the financial revenues to be used for major capital asset construction and/or purchases.

Additionally, the Town reports the following fund types:

The Internal Service Funds account for risk financing activities for medical insurance benefits and other self-insured risks.

The Pension Trust Funds account for the activities of the Town Employees' Retirement System, and the Police and Fire Retirement Plan, which accumulates resources for pension benefit payments to qualified employees.

The Other Postemployment Benefit Trust Funds account for the activities of the Town and Police and Fire OPEB Plan, which accumulates resources for retiree medical and life insurance benefits.

The Agency Funds account for monies held on behalf of students.

Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in the government-wide financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board.

As a general rule, the effect of interfimd activity has been eliminated from the government-wide financial statements. Exceptions are charges between certain Town functions because the elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned.

Amounts reported as program revenues include 1) charges to customers or applicants for goods, services, or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes. TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) B. Measurement Focus, Basis of Accounting, and Financial Statement Presentation (Continued) Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result fiom providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the Town's internal service funds are charges to Town Departments for various types of self-insurance. Operating expenses for the internal service hdincludes the cost of insurance and administrative expenses. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. When both restricted and unrestricted resources are available for use, it is the Town's policy to use restricted resources first, then unrestricted resources as they are needed. C. Assets, Liabilities, and Net Assets or Equity I. Deposits and Investments Deposits - The Town considers cash equivalents as cash on hand, demand deposits, money market accounts and short-term investments with original maturities of three months or less &om the date of acquisition. Investments - In general, State of Connecticut Statutes allow the Town to invest in obligations of the United States of America or United States government sponsored corporations, in shares or other interests in any custodial arrangement, pool, or no-load, open-end management type investment company or investment trust (as defined), in obligations of any state or political subdivision rated within the top two rating categories of any nationally recognized rating service, or in obligations of the State of Connecticut or political subdivision rated within the top three rating categories of any nationally recognized rating service. Investment income is recorded in the fund in which it was earned. Investments for the Town are reported at fair value. State Treasurers Investment Fund is an investment pool managed by the State of Connecticut Office of the State Treasurer. Investments must be made in instruments authorized by Connecticut General Statutes 3-27c - 3-27e. Investment guidelines are adopted by the State Treasurer. The fair value of the position in the pool is the same as the value of the pool shares. The balance of the pooled fixed income investments was invested in a 2a-7 like pool which operates under State Statutes. The fair value of the position in the pool is the same as the value of the pool shares. 2. Receivables and Pavables

a, Interfunds Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either "due tolfrom other funds" (i.e., the current portion of interfund loans) or "advances tolfiom other funds" (i.e., the non-current portion of interfund loans). TOWN OF FARFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

I. SUMMARY OF SIGMFICANT ACCOUNTING POLICIES (CONTINUE@)

C. Assets, Liabilities, and Net Assets or Equity (Continued)

2. Receivables and Pavables (Continued)

6. Propertv Taxes and Other Receivables

In the government-wide financial statements, all trade, property tax, sewer use, sewer assessment, and loan receivables are shown net of an allowance for uncollectibles. Allowance percentages range from 2 to 29 percent of outstanding receivable balances, and are calculated based upon prior collections.

In the fund fmcial statements, property tax revenues are recognized when they became available. Taxes collected during the 60 day period have been recorded as revenue. All property taxes receivable, which have not been collected within 60 days of June 30, have been recorded as deferred revenue, since they are not considered to be available to finance expenditures of the current fiscal year.

Loan receivables consist of Community Development Block Grant loans. The Town provides low interest loans for residential rehabilitation as well as loans to local businesses for facility improvements.

Property taxes are assessed on property as of October 1. Taxes are billed in the following July and are due in four installments, July 1, October 1, January 1, and April 1. Liens are effective on the assessment date and are continued by filing before the end of the fiscal year following the due date.

3. Restricted Assets

The restricted assets for the Town are restricted for endowment purposes. The trust agreement restricts the expenditure of the investment income only for the designated purpose.

4. Capital Assets

Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, bridges, sidewalks, and similar items), are reported in the applicable governmental columns in the government-wide financial statements. Capital assets are defined by the government as assets with an initial, individual cost of more than $10,000 for equipment and $100,000 for infrastructure (amounts not rounded), and an estimated usefbl life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of donation.

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

Major outlays for capital assets and improvements are capitalized as projects are constructed. EXHIBIT L TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

I. SU-Y OF SIGNIFICANT A CCO UiVTING POLICIES (CONTIMIED)

C. Assets, Liabilities, and Net Assets or Equitv (Continued)

4. Capital Assets (Continued)

Property, plant, and equipment of the primary government are depreciated using the straight-line method over the following estimated useful lives:

Assets Years

Buildings and improvements 45 Machinery and equipment 5 -20 Vehicles 6-15 Infi-astructure 35 - 70 Intangible assets (software) 10

5. Compensated Absences

Employees are paid by a prescribed formula for absence due to vacation and sickness. The . eligibility for vacation pay vests when earned; however, unused sick leave may only be accumulated for use in future absences. The General Fund is the primary source to liquidate compensated absences.

6. Long-Term Oblimitions

In the government-wide financial statements, long-term debt and other long-term obligations are reported as liabilities in the Governmental Activities Statement of Net Assets. Bond premiums and discounts, as well as issuance costs, are deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are reported as deferred charges and amortized over the term of the related debt.

In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other fmancing sources. Premiums received on debt issuances are reported as other financing sources, while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld &om the actual debt proceeds received, are reported as debt service expenditures.

7. Fund Equity and Net Assets

In the fund financial statements, governmental funds report reservations of fund balance for amounts that are not available for appropriation or are legally restricted by outside parties for use for a specific purpose. Designations of fund balance represent tentative management plans that are subject to change. TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTLNUED)

SUMlMARlY OF SIGNIFICANT ACCOUNTmTG POLICIES (CONTINUED)

C. Assets, Liabilities, and Net Assets or Equitv (Continued)

7. Fund Equitv and Net Assets (Continued)

In the government-wide financial statements, net assets are classified into the following categories:

Invested in Capital Assets, Net of Related Debt

This category presents the net assets that reflect capital assets net of only the debt applicable to the acquisition or construction of these assets. Debt issued for non-capital purposes, and unspent bond proceeds, are excluded.

Restricted Net Assets

This category presents the net assets restricted by external parties (creditors, grantors, contributors or laws and regulations).

Unrestricted Net Assets

This category presents the net assets of the Town which are not restricted.

8, Estimates

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities including disclosures of contingent assets and liabilities and reported revenues, expenses and expenditures during the fiscal year.

9. Reclassifications

Certain amounts presented in the prior year data have been reclassified in order to be consistent with the current year's presentation.

II. STEWARDSHIP, COMPLL4NCE AND ACCOUNTABILITY

A. Budvets and Budgetarv Accounting

The Town adheres to the following procedures in establishing the budgetary data included in the General Fund financial statements. The operating budget, which is prepared by function and department, includes proposed expenditures and the means of financing them.

Annually in May, the proposed budget is presented at Representative Town Meeting, at which taxpayer comments are obtained. Prior to July 1, the budget is legally enacted through passage of a resolution. EXHIBIT L TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

II. STEWARDSHIP, COMPLUNCE AND ACCOUNTABILITY (CONTWED) A. Budgets and Budgetarv Accounting (Continued) The Board of Finance is authorized to transfer budgeted amounts within departments. However, any revisions that alter the total expenditures of any department must be approved at a Representative Town Meeting. Additional appropriations of $210 were approved in accordance with Charter provisions during the year, $135 from fund balance, and $75 from increases in revenue estimates.

0 Formal budgetary integration is employed as a management control device during the year.

The legal level of control (the level at which expenditures may not legally exceed appropriations) is at the department level.

* The Board of Education is authorized under state law to make any transfers required within their budget at their discretion. Additionally, as required by the Charter, these transfers must be reported to the Board of Selectman. Any additional appropriations must have Board of Education and Board of Selectman approval and, if over one-half of one percent of the annual budget, Town Meeting approval.

Encumbrances are recognized as a valid and proper charge against a budget appropriation in the year in which the purchase order, contract or other commitment is issued and, accordingly, encumbrances outstanding at year end are reported in budgetary reports (Exhibit F) as expenditures in the current year. Generally, all unencumbered appropriations lapse at year end, except those for the Capital Projects Funds and those specifically reappropriated by the Board of Finance.

In addition to the General Fund, the Water Pollution Control Authority WCA)Fund has a legally adopted annual operating budget. The control level on which expenditures may not legally exceed appropriations is the fund level. Appropriations for capital projects are continued until completion of applicable projects, even when projects extend more than one fiscal year. B. Budget - GAAP Reconciliation A reconciliation of revenues, expenditures, and fund balance between the accounting treatment required by GAAP (Exhibit D), and budgetary requirements (Exhibit F), is as follows: FUND REVENUES EXPENDITURES BALANCE BALANCE, BUDGETARY BASIS, EXHIBIT F - JUNE 30, 201 0 ...... $ 246,710 $ 242,066 $ 12,286 Encumbrances outstanding at June 30,2009, liquidated during the year, June 30, 20 10 ...... Encumbrances outstanding at June 30,2009 and 2010 ...... 40 Encumbrances outstanding at June 30,20 10, charged to budgetary expenditures ...... State Teachers' Retirement on-behalf payment ...... 11,854 11,854 BALANCE, GAAP BASIS, EXHIBIT D - JUNE 30, 2010 ...... $ 258,564 $ 253,636 $ 13.362 EXHIBIT L TOWN OF FAIRFIELD. CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

I. STEWARDSHIP. COMPLL4NCE AND ACCOUNTABILITY (CONTINUED)

C. Capital Projects Authorizations

The following is a smaryof Capital Projects at June 30. 2010.

PROJECT CUMULATIVE BALANCE PROJECT NAME ALJTHORIZATION EXPENDITURES JUNE 30.2010

Financial Software...... School Annexes ...... W.P.C.A. Special Project ...... Penfield Pavilion ...... Tomlinson Middle School Renovation ...... Black Rock Train Station ...... Stratfield Elementary Renovation ...... FWMS Renovation ...... RR Intersection Improvements...... Non-Recuning Capital Projects ...... Harbor Road Bridge ...... Fire Suppression Line...... Flood Construction ...... Mill Plain Road Bridge ...... Golf Course Expansion ......

TOTAL CAPITAL PROJECTS FUND ...... $$ 47.82

D . Donor Restricted Endowments

The Town has received certain endowments for the improvement and betterment of Fairfield public schools. The amounts are reflected in net assets as restricted for endowments. Investment income is approved for disbursement by the Board of Education or the applicable Trustee and is included in unreserved fund balance . There is no appreciation available for appropriation.

E. Deficit Fund Balance

During the year ended June 30.2010. the Town had a deficit fund balance in the following funds:

Special Revenue Funds: Special Assessments ...... $ 226 Community Development Block Grant ...... 191 Special Education ...... 117 Navy Housing ...... 848

The deficits will be funded by future charges for services. intergovernmental grants idassessments. EXHIBIT L TOWOF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL, STATEMENTS (CONTINUED)

IIX DETALED NOTES

A. Cash and Investments

Deposits - Custodial Credit Risk - Custodial credit risk is the risk that, in the event of a bank failure, the Town's deposits may not be returned to it. The Town does not have a deposit policy for custodial credit risk. As of June 30, 2010, $17,890 of the Town's bank balance of $26,165 was exposed to custodial credit risk as follows:

Uninsured and uncollateralized ...... $ 15,976 Uninsured and collateral held by the pledging bank's trust department, not in the Town's name ...... 1.914

Total amount subject to custodial credit risk ...... $ 17.890

On October 3, 2008, the Emergency Economic Stabilization Act of 2008 increased the insurance coverage offered by the Federal Deposit Insurance Corporation (FDIC) from $100,000 to $250,000 per depositor. This limit is anticipated to return to $100,000 after December 31, 2013. Additionally, under the FDIC's Temporary Liquidity Guarantee Program (TAG), amounts held in non-interest bearing transaction accounts at participating institutions are fully guaranteed by the FDIC through December 31, 2010. Participation in the TAG program by a financial institution is optional, and therefore, not all fmancial institutions currently participate in the program. This guarantee is anticipated to be reduced to the $250,000 limit on January 1, 201 1, and the $100,000 limit on January 1, 2014. The Town had amounts in excess of $250,000 in a single bank during the year. Amounts over $250,000 are not insured by the FDIC. These balances fluctuate during the year and can exceed this $250,000 limit. Management regularly monitors the financial institution, together with its cash balances, and tries to keep this potential risk to a minimum.

At June 30,2010, the Town's investments (including restricted investments) consisted of the following:

INVESTMENT MATURlTlES (IN YEARS) FAIR LESS 1-5 5-1 0 OWR TYPE OF INVES- VALUE N/A THAN1 YEAkS YEARS 10

Mutual Funds: Equity...... Money Market...... Bond ...... U.S. Government Agency ...... Foreign Currency ...... Certificates of Deposit ...... Pooled Fixed Income ...... U.S. Government Obligations ...... U.S. Government Agency Obligations...... Common Stock ...... Hedge Funds ...... Real Estate ...... Mortgage Backed Securities...... Municipal Obligations...... Corporate Bonds ......

TOTAL ...... $ 304.356 $ 121.204 $ 67,804 $ 28,472 $ 23.730 $ 63.146 TOWN OF FAIRFELD, CONNECTICUT NOTES TO BASIC FINANCIAL, STATEMENTS (CONTINUED)

IIX DETAlLED NOTES (CONTmD)

A. Cash and Investments (Continued)

Interest rate risk - The Town does not have a formal investment policy that limits investment mahuities as a means of managing its exposure to fair value losses arising from increasing interest rates.

Credit risk - The Town has no investment policy that would limit its investment choices due to credit risk other than State Statutes governing investments in obligations of any State or political subdivision or in obligations of the State of Connecticut or political subdivision.

The Town's investments subject to credit risk have average ratings by Standard & Poor's as follows:

RATINGS TYPE OF INVESTMXNT AAA AA A BBB BB C UNRATED TOTALS Mutual Funds: Money Market...... US Government Agency ...... Bond ...... Foreign Currency ...... Pooled Fixed Income ...... Government Agency Obligations ..... Mortgage Backed Securities...... Municipal Obligations ...... Corporate Bonds ......

TOTAL ...... $ 39.029 $ 6.195 $ 10.254 $ 9.455 $ 198 $ 9.433 $ 51.451 $ 126.015

Custodial credit risk - The Town does not have a formal policy with respect to custodial credit risk. Custodial credit risk is the risk that, in the event of the failure of the counterparty, the Town will not be able to recover the value of its investment or collateral securities that are in the possession of an outside Party.

Certain investments are covered by the Securities Investor Protection Corporation (SIPC) up to $500,000, including $100,000 of cash from sale or for purchase of investments, but not cash held solely for the purpose of earning interest. SIPC protects securities such as notes, stocks, bonds, debentures, certificates of deposit and money fimds.

The following Town investments are held by the counterparty's trust department or agent but not in the Town's name and, therefore, are subject to custodial credit risk as follows: AMOUNT LESS SUBJECT TO INSURED CUSTODIAL TOTAL AMOUNTS CREDIT RISK U.S. Government obligations...... $ 36,131 $ 500 $ 35,631 U.S. Government agency obligations ...... 40,545 1,500 39,045 Common stock ...... 61,309 500 60,809 Mortgage backed securities ...... 13,685 13,685 Municipal obligations ...... 4,786 4,786 Corporate bonds ...... 25,552 25.552 TOTAL...... TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL! STATEMENTS (CONTINUED)

III. DETMLED NOTES (CONTIWED)

B. Receivables

Receivables as of year end for the Town's government-wide financial statements by type, including the applicable allowances for uncollectibles, are as follows:

PROPERTY TAXES USE FEE INTEREST TAXES & LIEN FEES TOTAL

Current Portion ...... $ 2,060 $ 225 $ 2.285

Long-term Portion ...... $ 1,599 $ 583 $ 2,182

Less Allowance for Uncollectibles ... ( 226) ( 246) ( 472)

Net Long-term Portion ...... $ 1.373 $ 337 $ 1.710

SEWER USE AND ASSESSMENTS USE FEES AND INTEREST CDBG ASSESSMENTS & LEN FEES TOTAL LOANS

Current Portion ...... $ 323 $ 84 $ 407 $ 58

Long-term Portion ...... $ 736 $ 104 $ 840 $ 1,220

Less Allowance for Uncollectibles ... ( 22) ( 2) ( 24) 24)

Net Long-term Portion ...... $ 714 $ 102 $ 816 $ 1.196

Governmental funds report deferred revenue in connection with receivables for revenues that are not considered to be available to liquidate liabilities of the current period. Governmental funds also defer revenue recognition in connection with resources that have been received, but not yet earned. At the end of the current fiscal year, the various components of deferred revenue and unearned revenue reported in the governmental funds were as follows:

DEFERRED REWENUE: Delinquent property taxes receivable (general fund) ...... $ 2,905 Sewer assessments not yet due and delinquent sewer use (special revenue fund) ...... 1,059 Loan receivable not yet earned ...... 1,278

UNEARNED REVENUE: Advance tax collections ...... 6,422 Unearned charges for services (special revenue) ...... 50 1

TOTAL DEFERRED AND UNEARNED REVENUE FOR GOVERNMENTAL FUNDS AND INTERNAL SERVICE FUNDS ...... $ 12,165 EXHIBIT L TOWN OF FAIRFIELD. CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

IIL DETATLED NOTES (CONTINUED) C. Capital Assets Capital asset activity for the year ended June 30. 2010 was as follows:

BALANCE BALANCE JUL,Y 1. 2009 INCREASES DECREASES JUNE 30.201 0 [THOUSANDS) Governmental Activities: Capital Assets. not being Depreciated: Land ...... $ 37,508 $ 10 $ $ 37,518 Assets held for sale ...... 909 909 Construction in progress...... 24.541 9. 698 1. 080 33. 159 Total Capital Assets. not being Depreciated ...... 62.958 9. 708 1. 080 71. 586

Capita1 Assets. being Depreciated: Buildings and improvements...... 415. 457 1.236 416. 693 Vehicles ...... 15. 075 748 1. 276 14.547 Machinery and equipment ...... 13.467 749 622 13.594 Intangible assets ...... 546 546 Infrastructure...... 121.753 2. 121 9 123.865 Total Capital Assets. being Depreciated ...... 565.752 5. 400 1. 907 569.245

Total Capital Assets ...... 628. 710 15. 108 2.987 640.83 1

Less Accumulated Dareciation for: Buildings ...... 77,452 8,452 85,904 Vehicles ...... 11,451 596 1,057 10,990 Furniture and equipment ...... 6, 322 198 622 5,898 Intangible assets ...... 129 129 Infrastructure ...... 67. 343 2. 053 9 69. 387 Total Accumulated Depreciation ...... 162. 568 11.428 1.688 172.308 Total Capital Assets. being Depreciated. net ...... 403.1 84 6. 028) 219) 396.937

Governmental Activities Capital Assets. net ...... $ 466:142 $ 3.680 $ 1. 299 $ 468.522 Depreciation expense was charged to functionslprograms of the Town as follows:

Governmental Activities: General government ...... Finance ...... Public safety ...... Public works ...... Health and human services ...... Culture and recreation ...... Board of Education ...... Total Depreciation Expense .Governmental Activities ...... TOWN OF FADRFIELD. CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

III. DETAILED NOTES (CONTINED)

C. Capital Assets (Continued) Construction Commitments At June 30.2010. the Town had the following construction commitments:

Stratfield school renovations ...... $ 9. 107 Fairfield Woods middle school ...... 775 Train station ...... 2. 522 Total ...... $ 12.404 D . Interfund Accounts 1. Interfund Pavables and Receivables A summary of intehdbalances as of June 30. 2010 is as follows:

CORRESPONDING FUND DUE FROM DUE TO MAJOR FUNDS

GENERAL FUND: Special Revenue Funds .Town ...... NIA Special Revenue Funds .BOE ...... NIA Capital Projects Fund ...... NIA Internal Service Fund .Town ...... NIA Town E~nployeesPension Trust ...... NIA Police and Fire Pension Trust ...... NIA Police and Fire OPEB Trust ...... NIA Town OPEB Trust ...... NIA TOTAL GENERAL FUND ......

CAPITAL PROJECT FUND ...... General Fund

NONMAJOR FUNDS

SPECIAL REVENUE FUNDS: General Fund .Town ...... General General Fund .BOE General TOTAL SPECIAL REVENUE FUNDS ......

INTERNAL SERVICE FUNDS ...... General Fund 1.006

PENSION AND OPEB TRUST: Town Etnployees Pension...... General Fund 194 Police and Fire Pension ...... General Fund 3 Pension - Town ...... 346 Pension - Police and Fire ...... 346 TOTAL PENSION TRUST...... 543 346

OPEB TRUST: General Fund .OPEB Town ...... General Fund .OPEB Police and Fire ...... TOTAL OPEB TRUST......

GRAND TOTAL ...... 9; 6.028 $ 6.028 All interfund balances resulted from the time lag between the dates payments occurred between funds for short-term internal financing. 43 TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

II. DETAILED NOTES (CONTINUED) D. Interfund Accounts (Continued) 2. Interfund Transfers A summary of interfund transfers as of June 30,2010 is as follows:

CORRESPONDING FUND TRANSFER IN TRANSFER OUT MAJOR FUNDS:

GENERAL, FUND: Special Revenue Funds ...... N/A $ 109 $ Debt Service...... N/A 369 Capital Projects Funds ...... N/A 285 2,808 TOTAL GENERAL FUND ...... 394 3.177

CAPITAL PROJECTS FUNDS: Capital Projects Funds ...... General Fund 2,808 285 Capital Projects Funds ...... Special Revenue Fund 100 Capital Projects Funds ...... Debt Service Fund 727 Capital Projects Funds ...... Internal Service Fund 193 TOTAL CAPITAL PROJECTS FUNDS ...... 2.908 1,205

NONMAJOR FUNDS: Special Revenue Funds ...... General Fund 109 Special Revenue Funds ...... Capital Projects 100 Debt Service...... General Fund 369 Debt Service ...... Capital Projects 727 Internal Service Fund ...... 193 TOTAL NONMAJOR FUNDS ...... 1,289 209

GRAND TOTAL ...... $ 4.591 $ 4,591 Transfers are used to account for the financing by the general fund of various programs and activities in other funds. E. Short-Term Obligations - Bond Anticipation Notes The Town is using bond anticipation notes during the construction of the school prior to the issuance of the bonds at the completion of the project. Short-term obligation activity for the year ended June 30,2010 was as follows:

MATURITY COUPON BALANCE BALANCE TYPE OF OBLIGATION DATE RATE JULY 1.2009 ADDITIONS REDUCTIONS JUNE 30,201 0

Bond Anticipation Notes: Schools ...... 7/23/2010 1.50% $ 13,840 $ 8,742 $ 22,005 $ 577 General Purpose ...... 7/23/20 10 1.50% 1.645 16,648 3,585 14,708

Total ...... $ 15.485 $ 25.390 $ 25.590 $ 15.285 The bond anticipation notes mature in July 2010 and carry a coupon interest rate of 1.50%, and a true interest cost of .45%. In July 2010, the Town issued $1 8,115 of bond anticipation notes that mature in July 201 1 and carry a coupon interest rate of 2.00%, and a true interest cost of .31%. 44 TOWN OF FAIRFIELD. CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

IIX DETBLED NOTES (CONTINUED) F. Changes in Long-Term Obligations I . Surn~~zarvof Changes The following is a summary of changes in long-term obligations during the fiscal year: BALANCE BALANCE ORIGINAL DATE OF DATE OF INTEREST JULY 1. RE- JUNE 30. CURRENT DESCRIPTION AMOUNT ISSUE MATURITY RATE 2009 ADDITIONS DEDUCTIONS FUNDED 2010 PORTION [THOUSANDS) BONDS: General Purpose: Improvement bond . $ 4. 191 06/15/00 06/15/20 5.0%.5.6% $ 372 $ $ 375 $ $ . $ Improvement bond . 5. 765 04/01/02 04/01/22 4.7% 1. 165 390 A 775 396 Refunding issue ..... 6. 549 05/01/02 08/01/11 4.7% 1. 63 1 77 1 860 435 Debt issue ...... 333 07/01/03 01/15/13 2.0%.4.5% 189 189 Debt issue ...... 7. 550 07/15/03 01/01/23 4.1% 335 335 Refunding ...... 2. 775 03/18/04 01/01/20 2.0%.5.0% 2. 670 162 2. 508 161 Refunding ...... 2. 521 12/07/04 04/01/22 2.0%.4.25% 2. 421 14 2. 407 222 Debt issue ...... 1. 070 07/15/07 07/15/27 4.0%.5.0% 1. 018 53 128 837 53 Refunding issue ..... 5. 447 05/29/08 01/01/23 3.375%.5.0% 5. 400 93 5. 307 459 Debt issue ...... 5. 265 07/15/08 07/15/28 3.125%.5.0% 5. 265 210 783 4. 272 139 Debt issue ...... 802 0813 1/09 0711 5/21 5.0% 802 802 Total General Purpose 20.466 802 2.400 91 1 17.957 1.865 Schools: School bond ...... 2. 679 06/15/00 06/15/20 5.0%.5.6% 23 8 238 School bond ...... 27. 955 04/01/02 0410 1/22 4.7% 4. 885 1. 585 3. 300 1.635 Refunding issue ..... 7. 246 05/01/02 08/01/11 4.7% 1. 804 853 95 1 481 Debt issue ...... 9. 185 07/01/03 01/15/16 2.0%.4.5% 1. 645 1. 645 Debt issue ...... 1. 967 07/01/03 01/15/13 2.0%-4.5% 1. 116 1. 116 Debt issue ...... 52. 450 07/15/03 01/01/23 4.1% 2. 765 2. 765 Refunding ...... 17. 157 03/18/04 01/01/20 2.0%.5.0% 16. 509 1.004 15.505 996 Refunding ...... 12. 519 12/07/04 04/01/22 2.0%-4.25% 12.399 8 1 12. 318 239 Debt issue ...... 45. 000 07/15/05 08/01/25 3.25%.5.0% 39. 600 1. 900 14.450 23. 250 1. 950 Debt issue ...... 25. 590 0711 5/07 0711 5/27 4.0%.5.0% 24. 542 1. 067 2. 577 20. 898 1.086 Refunding issue ..... 40. 623 05/29/08 01/01/23 3.375%.5.0% 40. 272 694 39. 578 3. 427 Debt issue ...... 23. 095 07/15/08 07/15/28 3.125%.5.0% 23. 095 915 3. 427 18.753 611 Debt issue ...... 18.608 0813 1/09 07/15/21 5% 18.608 18.608 Total Schools ...... 168.870 18.608 11.102 20. 454 155.922 10.424 Sewer: Sanitary sewers ...... 445 01/01/98 01/01/18 4.15%.6.0% 9 Refunding issue ..... 139 05/01/02 08/01/11 4.7% 34 16 18 Debt issue ...... 310 07/01/03 01/15/16 2.0%.4.5% 55 55 Refunding ...... 403 03/18/04 01/01/20 2.0%.5.0% 386 24 362 23 Refunding issue ..... 160 05/29/08 01/01/23 3.375%.5.0% 159 3 156 14 Total Sewer ...... 634 43 591 46 Total Bonds ...... 189.970 19.410 13. 545 21.365 174.470 12.336 NOTES: Water: CWF 2451) ...... 335 10/01/96 04/01/16 2.0% 106 28 78 15 CWF 355C ...... 1. 575 12/31/96 06/30/16 2.0% 550 79 47 1 79 CWF 399D ...... 2. 280 0713 1/99 0713 111 8 2.0% 1. 036 114 922 114 CWF 399C ...... 29. 436 07/30/03 0713 1/22 2.0% 20. 337 1. 373 18.964 1. 401 CWF 245C ...... 830 07/01/98 08/01/17 2.0% 339 42 297 42 Total Notes ...... 22.368 1.636 20.732 1.65 1 TOTAL BONDSMOTES 212. 338 19.410 15.181 21.365 195.202 13.987 EXHIBIT L TOWN OF F(a66IIIELD, CONbECTICerT NOTES TO BASIC FIWANCLaL STATEMENTS (CONT

112 DETAILED NOTES (CONTP1V&rED)

1. (Contkued) BALANCE BALANCE ORIGINAL DATE OF DATE OF lNTEREST JULY 1, RE- JUNE 30, CURRENT DESCRlPTlON AMOUNT ISSUE MATURITY RATE 2009 ADDITIONS DEDUCTIONS FUNDED 201 0 PORTION [THOUSANDS)

OTHER LIABILITIES: Bondpremium ...... $ 3,882 $ 3,328 $ 619 $ $ 6,591 $ Deferred charges ...... ( 2,911) ( 1,211) ( 479) ( 3,643)

TOTAL BONDSNOTES AND RELATED LJABLITES...... 213,309 21,527 15,321 21,365 198,150 13,987

BOND ANTICIPATION NOTES ...... 10,105 10,105

COMPENSATED ABSENCES ...... 3,616 2,276 2,166 3,726 745

CAPITAL LEASES ...... 304 304

HEART AND HYPERTENSION ...... 913 626 635 904 673

RISK MANAGEMENT (Internal Service Funds) ...... 9,185 32,905 30,896 11,194 5,081

NET OPEB OBLIGATION ...... 9.927 4.001 13.928

TOTAL LONG-TERM OBLIGATIONS...... $ 237254 $ 7 1.440 $ 49,322 $ 21.365 $ 238.007 $ 20.486

The following is a summary of amounts to be provided by the State of Connecticut for the retirement of school bonds and bond and note maturities (Thousands):

AMOUNT TO AMOUNT TO FISCAL BE PROVIDED BE PROVIDED YEAR ENDED BY STATE BY STATE BOND NOTES TOTAL JUNE 30, PRINCIPAL INTEREST PRINCIPAL PRINCIPAL INTEREST

$ 2.028 $ 259 $ 174.470 $ 20.732 $ 62.027 All long-term liabilities listed above after bonds and notes are generally liquidated by the General Fund.

In July 2010, the Town issued $25,000 of general obligation refunding bonds maturing through 2030 and carrying an interest rate of 3.00% - 5.00%, of which $10,105 permanently financed bond anticipation notes oustanding at June 30,2010. 46 TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

IIL DETMLBD NOTES (CONTINUED) F. Changes in Long-Term Obligations (Continued) 2. Statutorv Debt Liniitations The Town's indebtedness does not exceed the legal debt limitations as required by Connecticut General Statutes as reflected in the following schedule: NET CATEGORY DEBT LIMIT INDEBTEDNESS BALANCE General purpose ...... $ 504,655 $ 34,434 $ 470,221 Schools ...... 1,009,310 162,807 846,503 Sewers ...... 841,091 40 841,051 Urban renewal ...... 728,946 728,946 Pension deficit ...... 672,873 672,873 The total overall statutory debt limit for the Town is equal to seven times annual receipts from taxation, $1,570,037. The indebtedness reflected above includes bonds outstanding in addition to the amount of bonds authorized and unissued against which bond anticipation notes are issued and outstanding. School building grants receivable of $2,028 for bond principal are reflected as deductions in the computation of net indebtedness. 3. Capital Leases The Town was committed under a capital lease for the acquisition of equipment. The final lease payment was made during 20 10. Capital leases that are capitalized under the category of energy saving equipment totaled $1,520 at June 30,2010. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception. 4. AuthorizedRTnissued Bonds The amount of authorized, unissued bonds is $78,271 for school and $1 11,960 for general purposes. 5. Prior Year Advance Refunding In prior years, the Town defeased certain general obligation bonds by placing the proceeds of the new bonds in an irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the liability of the defeased bonds are not included in the Town's financial statements. At June 30, 2010, $19,375 of bonds outstanding are considered defeased.

6. Current Year Advance Refunding

In July 2009, the Town issued $19,410 of general obligation refunding bonds with an interest rate of 5%. These refunding bonds were issued to advance refund and defease bonds issued July 15, 2005, July 15, 2007, and July 15, 2008. The refunding resulted in an economic gain of $575 with a total savings of $640. TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

IK OTHER INFORMATION

A. Risk Management Except for the purchase of commercial insurance coverage for all Town buildings (flood, fire and casualty), errors and omissions, general liability umbrella policy with a retention limit of $500,000 (amount not rounded) per incident, law enforcement liability insurance policy with a deductible of $50,000 (amount not rounded), workers' compensation excess policy with a retention limit of $500,000 (amount not rounded) per incident, and employee group medical claims in excess of $150,000 (amount not rounded), the Town is exposed to various risks for which it has retained the risk of loss including torts; theR of, damage to, and destruction of assets; natural disaster; general liability; workers' compensation; and employee and post-retiree group medical. Settled claims have not exceeded commercial coverage in any of the past three years, and there has not been any significant reductions in insurance coverage fiom amounts held in prior years. The Town utilizes a risk management fund (the Internal Service Fund) to account for and finance its uninsured risks of loss. The fund records all claim expenditures and liabilities when it is probable that a loss has occurred and the amount of that loss can be reasonably estimated. All Town departments and agencies are charged premiums by the Internal Service Fund, which are included in department and agency expenditures, to cover the estimated cost of claims payment based on historical cost estimates of the amounts needed to pay prior and current year claims. Claims liabilities include an estimate of claims incurred but not reported and are the Town's best estimate based on available information. The claims liability reported in the fund is based upon the provisions of GASB Statements No. 10 and 30, which require that a liability for estimated claims incurred but not reported be recorded. The amount of claim accrual is based on the ultimate costs of settling the claim, which include past experience data, inflation and other future economic and societal factors and incremental claim adjustment expenses, net of estimated subrogation recoveries. The claim accrual does not include other allocated or unallocated claims adjustment expenses.

CURRENT YEAR CLAIMS CLAIMS AND CLAIMS PAYABLE CHANGES IN CLAIMS PAYABLE JULY 1 ESTIMATES PAID JUNE 30

B. Commitments and Litigation Construction and other commitments are reported as a reserve for commitments in the fund equity section of the balance sheet and the statement of net assets (if any). Amounts received or receivable fiom the grantor agencies are subject to audit and adjustment by grantor agencies. Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of expenditures which may be disallowed by the grantor cannot be determined at this time, although the Town expects such amounts, if any, to be immaterial. The Town is a defendant in various lawsuits. The outcome of these lawsuits is not presently determinable. In the opinion of the Town attorney, the resolution of these matters will not have a material adverse effect on the financial condition of the Town. TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

N; OTHER INFORMATION (CONTINUED) B. Commitments and Litigation (Continued) Contingencv - Pension Fund Certain limited amounts of the redemptions made by the Town from these funds might be subject to "clawback" claims by the trustee in the Madoff bankruptcy. This matter would be handled by outside counsel who has indicated that the probability of the Town being subject to these claims is unlikely. Any "clawback" would relate only to investment earnings. Were such a claim to be made, the Town would aggressively defend against it. C. Pension Plans 1. Plan Description Summary The Town administers two single employer, contributory, defined benefit pension plans (Town Employees Retirement Plan, and Police and Fire Retirement Plan). The Town's plan benefits and contribution requirements are established by plan documents, by approval of the Representative Town Meeting. The Police and Fire plan benefit and contribution requirements are established by plan documents adopted July 1, 1998, by approval of the Representative Town Meeting. The plans do not issue separate stand alone financial reports. 2, Summaw ofSignificant Accounting Policies and Plan Asset Matters a Basis ofAccounting The Town's pension trust funds' financial statements are accounted for using the accrual basis of accounting. Contributions are recognized when they are due, pursuant to formal commitments and contractual requirements. Investment income is recognized when earned. Expenses (benefits, administration, and refunds) are recognized when they are due and payable in accordance with the terms of the plan. b. Valuation ofInvestntents Investments are valued at fair value. Securities traded on national exchanges are valued at the last reported sales price. Certain investments which are part of the Town's investment in hedge funds are valued at the last trade price or recent appraisals. There are no investments of 5% or greater in any one organization. 3. Classes ofEmployees Covered As of July 1,2009, the membership in the Plans are comprised of the following:

TOW POLICE AND EMPLOYEES FIRE Retirees and beneficiaries currently receiving benefits ...... 389 196 Terminated employees entitled to benefits but not yet receiving them...... 44 1 Active plan members ...... 743 193 TOTAL...... 1.176 390 TOWN OF FALRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

IK OTHER INFORM4 TION (CONTINUED)

C. Pension Plans (Continued) 4. Benefit Provisions

a. Benefit Provisions Town General Town employees and non-certified Board of Education employees whose employment terminates after attaining age 62 and completion of 10 years of service shall be entitled to a retirement benefit equal to 1.25% of the employee's highest annual salary up to $7,800 plus 2.3% of the employee's highest annual salary in excess of $7,800, multiplied by years of service. Public works employees whose employment terminates after attaining age 59% and completion of 10 years of service shall be entitled to a retirement benefit equal to 1.25% of the employee's last two years' average salary up to $7,800 plus 2.3% of the employee's last two years' average salary in excess of $7,800, multiplied by the number of years of service. Vesting of benefits occurs on or after 10 years of service. The plan covers substantially all noncertified Board of Education employees and all regular Town employees. Police and Fire Police officers are eligible for a normal pension after attaining age 5 1 and after 20 years of service in the department, and shall be entitled to a retirement benefit equal to 2% of their basic annual salary at retirement for each year of service up through 25 years plus an additional 6% of their salary for each year in excess of 25 years up to a maximum of 80% of such annual salary. Fire fighters are eligible for a normal pension after 20 years of service in the department and have attained 45 years of age or have completed 25 years of service regardless of age shall be entitled to a retirement benefit equal to 2% of their basic annual salary at retirement for each year of service up through 25 years plus an additional 6% of their salary for each year in excess of 25 years up to a maximum of 80% of such annual salary. Vesting of benefits occurs when a participant has accumulated a minimum of 10 years of active service. b. Emplover Contributions Town The Town's contribution is actuarially determined on an annual basis using the projected unit credit method. The Town's contribution was $1,569. Administrative costs are generally financed through investment earnings.

Police and Fire

Police and Fire's contribution was $-0-. Administrative costs are generally financed through investment earnings.

c. Emplovee Contributions Employees under the Town plan are required to contribute 4% of their earnings. Non-certified Board of Education employees contribute 2% of the first $7,800 in salary plus 5% over the $7,800 threshold. Police officers are required to contribute 6% of their earnings; fire fighters are required to contribute between 2.5% and 4.5% of their earnings. EXHIBIT L TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCLAL STATEMENTS (CONTmD)

IK OTHER INFORMATION (CONTINUED)

C. Pension Plans (Continued)

5. Funded Status and Funding Progress

The funded status of the plan as of July 1,2009 was as follows:

(B) ACTUARIALLY [(A-B)/Cl ACCRUED (A-B) OVER (UNDER) (A) LIABILITY OVER1 FUNDED AAL AS ACTUARIAL ACTUARIAL (AAL) ER) FUNDED (C) A PERCENTAGE VALUATION VALUE OF PROJECTED FUNDED AAL COVERED OFCOVERED DATE ASSETS UNIT CREDIT a RATIO PAYROLL PAYROLL

TOWN

POLICE AND FIRE

Actuarial valuations involve estimates of the value of reported amounts and assumptions about the probability of events far into the future, and actuarially determined amounts are subject to continual revision as actual results are compared to past expectations and new estimates are made about the future. The required schedule of funding progress, immediately following the notes to the financial statements (RSI) presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time, relative to the actuarial accrued liability for benefits.

6. Actuarial Assumptions

The data presented in the schedule of funding progress and schedule of contributions were determined as part of the actuarial valuation at the date indicated. Additional information for the plan as of the latest valuation date is as follows:

TOW POLICE AND EMPLOYEES FIRE

VALUATION DATE July 1,2009 July 1,2009 ACTUARIAL COST METHOD Projected Unit Credit Projected Unit Credit AMORTIZATION METHOD Level Dollar Closed Level Dollar Closed REMAINING AMORTIZATION PERIOD 8 13 ASSET VALUATION METHOD 5 years smoothing 5 years smoothing

ACTUARIAL ASSUMPTIONS: INVESTMENT RATE OF RETURN 8 .O% PROJECTED SALARY INCREASES 4.0% INFLATION RATE 3.0% COST-OF-LIVING ADJUSTMENTS 3.0% EXHIBIT L TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTmD)

W. OTHER INFORMATION (CONTINUED)

C. Pension Plans (Continued)

7. Annual Pension Cost and Net Pension Asset (1VPA)

The changes in the NPA of the Town plan were as follows:

TOWN POLICE AND EMPLOYEES FIRE

Annual required contribution ...... $ 1,569 $ Interest on net pension obligation ...... ( 103) ( 221) Adjustment to annual required contribution...... 155 299

Annual pension cost ...... 1,621 78 Contributions made ...... 1.569 (Increase) decrease in net pension asset ...... 52 78

Net pension asset - July 1, 2009 ...... ( 1,285) ( 2,766)

Net pension asset - June 30, 2010 ...... $( 1.2331 $! 2.688)

8. Three Year Trend Information

Fiscal Year Annual Percentage Net Ending Pension of APC Pension Actual June 30, Cost (APC) Contributed Obligation Contribution

TOWN EMPLOYEES

POLICE AND FIRE TOWN OF FARFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMBNTS (CONTINUED)

IV; OTHER INFORMA TION (CONTINUED) C. Pension Plans (Continued) 9. Plan Statements

COMBINENG STATEMENT OF FIDUCIARY FUND NET ASSETS PENSION TRUST FUNDS 30,2010 (THOUSANDS)

PENSION TRUST FUNDS TOTAL POLICE PENSION TOWN AND FIRE TRUST PENSION PENSION FUNDS

ASSETS

Investments at fair value: Cash and cash equivalents ...... Corporate bonds ...... U.S. Government obligations ...... U.S. Government agency obligations...... Municipal obligations ...... Hedge funds ...... Real estate ...... Mortgage backed securities...... Common stock ...... Mutual funds: Equities...... Bond...... Foreign currency...... U.S. agency funds......

Total Investments...... 124,387 127,649 252,036

Recievables: Interest and dividends......

Due from other funds ...... 540 3 543

TOTAL ASSETS ...... 125,236 127,978 253,214

LIABILITY

LIABILITY: Due to other funds...... 346 346

NET ASSETS

NET ASSETS HELD IN TRUST FOR PENSION BENEFITS...... TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

W. OTHER INFORMA TION (CONTIMIED)

C. Pension Plans (continued)

9. Plan Statenzents (Continued)

TOWN OF FARFIELD. CONNECTICUT

COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS PENSION TRUST FUNDS FOR THE YEAR ENDED JUNE 30,201 0 (THOUSANDS)

PENSION TRUST FUNDS

POLICE TOWN AND FIRE PENSION PENSION TOTAL

ADDITIONS: Contributions: Employer...... $ 1,569 $ $ 1,569 Plan members...... 1,321 3 1,324

Total contributions...... 2,890 3 2,893

Investment income: Change in fair value of investments...... 8,307 9,191 17,498 Recoveries (Madoff)...... 486 514 1,000 Interest and dividends...... 2,712 2,868 5,580

Total investment income (loss)......

Less investment expenses......

Net investment income (loss)......

TOTAL ADDITIONS ......

DEDUCTIONS: Benefits ...... Recovery expense (Madoff)...... Administration......

TOTAL DEDUCTIONS......

CWGESIN NET ASSETS ......

NET ASSETS - JULY 1, 2009...... NET ASSETS - .TUNE 30,2010 ...... TOWN OF FAIRFELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

W. OTHER INFORMA TION (CONTINUED)

D. Other Post-Employment Benefits Plan

I. Plan Description

The Town administers three single-employer, post retirement healthcare plans for the Town, Police and Fire, and Board of Education, for the Town of Fairfield Other Post Employment Benefits (OPEB). The Town and Police and Fire plans provide medical, dental and life insurance benefits for eligible retirees and their spouses. The Board of Education plan provides medical and dental benefits to eligible retirees and their spouses. For fiscal year 2010, the Police and Fire plan is considered to be part of the Town's financial reporting entity and is included in the Town's financial reports as an Other Post-Employment Benefits trust fund. The plan does not issue stand alone financial reports.

2. Summarv ofSignificant Accountin2 Policies and Plan Asset Matters

a Basis ofAccounting

The OPEB trust fund is accounted for using the accrual basis of accounting. Contributions are recognized when due, pursuant to formal commitments and contractual requirements, and revenue (investment income) is recognized when earned and expenses (benefits, administration and refunds) are recognized when due and payable in accordance with the terms of the plan.

b. Valuation ofInvestments

Investments are valued at fair value. Securities traded on national exchanges are valued at the last reported sales price. There are no investments of 5% or greater in any one organization.

3. Classes ofEinplovees Covered

As of July 1, 2009 for Town, Police and Fire and Board of Education, the plan's membership consisted of:

POLICE BOARD AND OF TOWN FIRE EDUCATION Retirees and beneficiaries currently receiving benefits ...... 287 229 250 Active plan members ...... 235 193 1,397

TOTAL,...... 522 422 1.647 TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

W. OTHER INFORMA TION (CONTINUED) D. Other Post-Emplovment Benefits Plan (Continued)

4. Benefit Provisions

a. Benefit Provisions

The Town plan provides for medical, dental and life insurance benefits for all eligible Town, Police, and Fire retirees and their spouses. The Board of Education plan provides medical and dental benefits for all Board of Education retirees and their spouses. Benefits and contributions are established by contract and may be amended by union negotiations. Administration costs are financed fiom investment earnings.

b. Einvlover Contributions

The Town's recommended contributions are actuaxially determined on an annual basis using the projected unit credit method. The Town, Police and Fire, and Board of Education's total plan contribution was $6,414.

c. Emvlovee Contributions

There are no employee contributions to the Town's plans. For the Police and Fire plan, contributions are to be made by actives as follows:

Police and Fire

July 1,2009 - 1.O% basic annual salary including longevity July 1,2010 - 1.5% basic annual salary including longevity

5. Funded Status and fund in^ Propress

The funded status of the plan as of July 1,2009 was as follows:

(B) ACTUARIALLY [(A-B)ICl ACCRUED (A-B) OVER (UNDER) (A> LIABILITY OVER/ FUNDED AAL AS ACTUARIAL ACTUARIAL (UNDER) FUNDED (C) A PERCENTAGE VALUATION VALUE OF PROJECTED FUNDED AAL COVERED OFCOVERED DATE ASSETS UNIT CREDIT AAL RATIO PAYROLL PAYROLL

TOWN

JULY 1,2009 $ 1,773 $ 53,312 $( 51,539) 3.3% $ 15,146 (340)%

POLICE AND FIRE

JULY 1,2009 $ 1,454 $ 62,090 $( 60,636) 2.3% $ 11,536 (448)%

BOARD OF EDUCATION

JULY 1,2009 $ $ 27,097 $( 27,097) 0.0% $ 87,722 (31)% EXHIBIT L TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

IK OTHER INFORMA TION (CONTINUED)

D. Other Post-Employment Benefits Plan (Continued)

5. Funded Status and Fundinn Pronress (Continued)

Actuarial valuations involve estimates of the value of reported amounts and assumptions about the probability of events far into the future, and actuarially determined amounts are subject to continual revision as actual results are compared to past expectations and new estimates are made about the future. The required schedule of funding progress, immediately following the notes to the financial statements (RSI-I), presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time, relative to the actuarial accrued liability for benefits.

6. Actuarial Methods and Assumptions

Projections of benefits are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits in force at the valuation date and the pattern of sharing benefit costs between the employer and plan members to that point. The projection of benefits for financial reporting purposes does not explicitly incorporate the potential effects of legal or contractual funding limitations on the pattern of cost sharing between the employer and plan members in the future. Actuarial calculations reflect a long-term perspective. Consistent with that perspective, actuarial methods and assumptions used include techniques that are designed to reduce short-term volatility in actuarially accrued liabilities and the actuarial value of assets.

The data presented in the schedules of funding progress and schedules of contributions were determined as part of the actuarial valuation at the date indicated. Additional information for all plans as of the latest valuation date is as follows:

VALUATION DATE July 1,2009 ACTUARIAL COST METHOD Projected Unit Credit AMORTIZATION METHOD Level Dollar REMAINING AMORTIZATION PERIOD: Town 19.5 years closed Police and Fire 29 years closed Board of Education 29 years closed ASSET VALUATION METHOD Fair Value

ACTUARIAL ASSUMPTIONS: Investment rate of return - Town and Police and Fire 7.5% Investment rate of return - Board of Education 4.5% Healthcare inflation rate: Initial 10% Ultimate 5% TOWOF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

N; OTHER INF0RMA.TION (CONTIWED)

D. Other Post-Employment Benefits Plan (Continued)

7. Annual OPEB Cost and Net OPEB Obligation (NOO)_

The changes in the NO0 were as follows: POLICE BOARD AND OF TOWN FIRE EDUCATION

Annual required contribution ...... $ 4,112 $ 4,423 $ 1,629 Interest on net OPEB obligation ...... 337 362 27 Adjustment to annual required contribution...... ( 219) ( 236) ( 20)

Annual OPEB cost ...... 4,230 4,549 1,636

Contributions made ...... 3,073 2.730 61 1

Change in net OPEB obligation ...... 1,157 1,819 1,025

Net OPEB obligation - July 1, 2009 ...... 4,490 4,830 607

Net OPEB obligation - June 30, 20 10 ...... $ 5.647 $ 6:649 $ 1.632

8, Three Year Trend Information

ANNUAL YEAR OPEB PERCENTAGE NET ENDING COST OF AOC OPEB TOTAL JUNE 30 (Aoc) CONTRIBUTED OBLIGATION CONTRIBUTIONS

TOWN

POLICE AND FIRE

BOARD OF EDUCATION EXHIBIT L TOWN OF FAIRFELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

IK OTHER INFORMATION (CONTINUED)

D. Other Post-Emplowent Benefits Plan (Continued)

9. Plan Stateinents

TOWN OF FAIRFIELD. CONNECTICUT

COMBINING STATEMENT OF FIDUCIARY FUND NET ASSETS OTHER POST-EMPLOYMENT BENEFIT TRUST FUNDS JUNE 30,2010 (THOUSANDS)

TOWN FIRE AND POLICE OTHER POST- OTHER POST- TOTAL EMPLOYMENT EMPLOYMENT OPEB BENEFITS BENEFITS TRUST TRUST FUND TRUST FUND FUNDS

ASSETS

Investments at fair value: Certificate of deposit...... $ $ 792 $ 792 Corporate bonds...... 788 788 1,576 U.S. Government obligations...... 616 616 1,232 U.S. Government agency obligations...... 402 3 97 799 Mutual funds ...... 903 912 1,815

Total Investments...... 2,709 3,505 6,214

Accounts receivable...... 82 79 161

TOTAL ASSETS ...... 2,79 1 3,584 6,375

LIABILITIES

Liabilities: Due to other funds...... 227 968 1,195 Claims payable ...... 182 175 357

TOTAL LIABILITIES...... 409 1,143 1,552

NET ASSETS

NET ASSETS HELD IN TRUST FOR OPEB BENEFITS...... $ 2,382 $ 2,441 $ 4,823 TOWN OF FAIRFIELD, CONNECTICUT NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)

W. OTHER INFORMA TION (CONTNED)

D. Other Post-Employment Benefits Plan (Continued)

9. Plan Statements (Continued)

COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS OTHER POST-EMPLOYMENT BENEFIT TRUST FUNDS FOR TmYEAR ENDED JlJNE 30,20 10 (THOUSANDS)

TOWN POLICE AND FIRE OTHER POST- OTHER POST- TOTAL EMPLOYMENT EMPLOYMENT OPEB BENEFITS BENEFITS TRUST TRUST FUND TRUST FUND FUNDS

ADDITIONS: Contributions: Employer ...... $ 3,073 $ 2,730 $ 5,803 Plan members...... 18 689 707

Total contributions...... 3,091 3,419 6,5 10

Investment income: Change in fair value of investments...... 141 135 276

TOTAL ADDITIONS...... 3,232 3,554 6,786

DEDUCTIONS: Benefits...... 2,611 2,315 4,926 Administration ...... 12 252 264

TOTAL DEDUCTIONS...... 2,623 2,567 5,190

CHANGES IN NET ASSETS...... 609 987 1,596

NET ASSETS - JULY 1, 2009...... 1,773 1,454 3,227

E. On-Behalf Payments

The amount of the State Teachers' Retirement Plan contribution recognized in the General Fund intergovernmental revenues and education expenditures for contributions made by the State on-behalf of the Town's teachers was $1 1,854. Required Supplementary Information REQUIRED SUPPLEMENTARY INFORMATION

FAIRFIELD RETLREMENT SYSTEM AND OTHER POST EMPLOYMENT BENEFIT (OPEB) PLANS SCHEDULE OF FUNDING PROGRESS

(THOUSANDS)

TOWN PLAN

ACTUARIALLY ACCRUED OVER OVERAJNDER ACTUARIAL ACTUARIAL LIABILITY (AAL) (UNDER) FUNDED FUNDED AAL AS VALUATION VALUE OF PROJECTED UNIT FUNDED AAL COVERED A PERCENTAGE OF DATE ASSETS CREDIT AAL RATIO PAYROLL COVERED PAYROLL

JULY 1, 2004 $ 143,440 $ 113,405 % 30,035 126.5% $ 27,129 1 10.7% 2005 149,453 122,508 26,945 122.0% 27,641 97.5% 2006 155,385 127,253 28,132 122.1% 29,526 95.3% 2007 164,818 135,707 29,111 121.5% 31,313 93.0% 2008 167,983 149,744 18,239 112.2% 33,094 55.1% 2009 164,018 156,886 7,132 104.5% 3 1,806 22.4%

POLICE AND FURE PLAN

A B (A-B) c I(A-B)/Cl

ACTUARIALLY ACCRUED OVER OVERAJNDER ACTUARIAL ACTUARIAL LIABILITY (a) (UNDER) FUNDED FUNDED AAL AS VALUATION VALUE OF PROJECTED UNIT FUNDED AAL COVERED A PERCENTAGE OF DATE ASSETS CREDIT AAL RATIO PAYROLL COVERED PAYROLL

JULY 1, 2004 $ 153,938 $ 124,110 $ 29,828 124.0% $ 10,776 276.8% 2005 159,739 130,274 29,465 122.6% 11,560 254.9% 2006 165,378 134,283 31,095 123.2% 11,588 268.3% 2007 174,456 136,489 37,967 127.8% 12,817 296.2% 2008 177,123 143,052 34,07 1 123.8% 13,050 261.1% 2009 171,586 151,728 19,858 113.1% 13,536 146.7%

(Continued) TOWN OF FARFIELD. CONNECTICUT

REQUIRED SUPPLEMENTARYINFORMATION

FAIRFIELD RETIREMENT SYSTEM AND OTkfER POST EM'LOYMENT BENEFIT (OPEB) PLANS SCHEDULE OF FUNDING PROGRESS

(THOUSANDS)

TOWN OPEB TRUST PLAN

A B (A-B) (Am C [(A-B)/CI

ACTUARIALLY ACCRUED OVER OVEWLMDER ACTUARIAL ACTUARIAL LIABILITY (AAL) (UNDER) FUNDED FUNDED AAL AS VALUATION VALUE OF PROJECTED UNlT FUNDED AAL COVERED A PERCENTAGE OF DATE ASSETS CREDIT AAL RATIO PAYROLL COVERED PAYROLL

JULY I, 2007 S E 55.45 1 % (55,451) 0.0% S 17,678 (3 14%) 2008 NlA NIA NIA NIA NIA NIA 2009 1,773 53,312 (51,539) 3.3% 15,146 (340%)

POLICE AND FIRE OPEB TRUST PLAN

A B (A-B) (Am C I(A-B)/CI

ACTUARIALLY ACCRUED OVER OVEWLMDER ACIUAR[AL ACTUARL4L LIABILITY (AAL) WER) FUNDED FUNDED AAL AS VALUATION VALUE OF PROJECTEDUNIT FUNDED AAL COVERED A PERCENTAGE OF DATE ASSETS CREDIT AAL RATIO PAYROLL COVEREDPAYROLL

JULY 1, 2007 S E 55,668 S (55,668) 0.0% S 12,818 2008 NIA NIA NIA NIA NIA 2009 1,454 62,090 (60,636) 2.3% 11,536

BOARD OF EDUCATION OPEB TRUST PLAN

A B (A-B) C [(A-B)ICI

ACTUARIALLY ACCRUED OVER OVEWLMDER ACrUAR[AL ACTUARIAL L~.~E~TY(AAL) (UNDER) FUNDED FUNDED AAL AS VALUATION VALUE OF PROJECTED UNIT FUNDED AAL COVERED A PERCENTAGE OF DATE ASSETS CREDIT AAL RATIO PAYROLL COVERED PAYROLL

JULY 1, 2007 E S 29,443 E (29,443) 0.0% S 83,018 2008 NIA NIA NIA NIA NIA 2009 27,097 (27,097) 0.0% 87.722 -RSI-2 TOWN OF FAIRFIELD. CONNECTICUI:

REQUIRED SUPPLEMENTARY INFORMATION FAIRFIELD RETIREMENT SYSTEM AND OTHER POST EMPLOYMENT BENEFIT (OPEB) PLANS SCHEDULE OF EMPLOYER CONTRIBUTIONS

TOWN, POLICE AND FIRE; PENSION AND OPEB PLANS

YEAR ANNUAL ENDED REQUIRED ACTUAL PERCENTAGE JUNIE 30, CONTRIBUTION CONTRIBUTION CONTRIBUTED

PENSION PLANS

TOWN EMPLOYEES

POLICE AND FE

OTHER POSTEMPLOYMENT BENEFIT PLANS

TOWN EMPLOYEES

POLICE AND FIRE

BOARD OF EDUCATION (This page intentionally left blank) General Fund

The general fund is the principal fund of the Town and is used to account for all activities of the Town, except those required to be accounted for in another fund. The general fund accounts for the normal recurring activities of the Town (i.e., general government, public safety, public works, buildings and grounds, planning and deve'lopment, health and human services, library, education, etc.). These activities are funded principally by property taxes, user fees and grants fiom other governmental units. SCHEDULE 1

TOWN OF FAIRFIELD. CONNECTICUT

GENERAL FUND COMPARATM BALANCE SHEET JUNE 30. 2010 AND 2009 (THOUSANDS)

ASSETS

Cash ...... Investments ...... Receivables, net: Property taxes ...... Intergovernmental...... Other...... Due from other funds ......

TOTAL ASSETS ......

LIABILITIES AND FUND BALANCES

Accounts payable ...... Accrued payroll ...... Due to other funds ...... Deferred revenue ...... Performance bonds ...... Other ......

Total Liabilities ......

Fund Balances: Reserved for: Encumbrances...... Unreserved: Unreserved and undesignated ......

Total Fund Balances ......

TOTAL LIABILITIES AND FUND BALANCES .... $ 42. 061 $ 38. 737 SCHEDULE 2 CONNECTTCUT

GENERAL FUND . SCHEDULE OF REVENUES AND OTHER FINANCING SOURCES BUDGET AND ACTUAL FOR THE YEAR ENDED JUNE 30. 2010 (THOUSANDS)

VARIANCE ORIGINAL FINAL WITH FINAL BUDGET BUDGET ACTUAL BUDGET

PROPERTY TAXES Current year levy ...... Prior years levy ...... Interest on delinquent taxes ...... Telecommunications access lines ......

TOTAL PROPERTY TAXES ......

INTERGOVERNMENTAL State grants for education...... School building grants...... Other state grants ...... Federal grants ......

TOTAL INTERGOVERNMENTAL......

CHARGES FOR SERVICES Licenses and permits ...... Fines ...... Department and other ...... Rents ......

TOTAL CHARGES FOR SERVICES ......

INVESTMENT INCOME ......

MISCELLANEOUS REVENUES......

TOTAL REVENUES ......

OTHER FINANCING SOURCES Appropriation of fund balance ...... Cancellation of prior year encumbrances ... Transfers in ......

TOTAL OTHER FINANCING SOURCES ...

TOTAL REVENUES AND OTHER FINANCING SOURCES...... SCHEDULE 3 (1 of2) TOWN OF FAIRFIELD. CONNECTICUT

GENERAL FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES BUDGET AND ACTUAL FOR THE YEAR ENDED JUNE 30, 2010 (THOUSANDS) .

V~CE ORIGINAL FINAL WITH FINAL· BUDGET BUDGET ACTUAL BUDGET

GENERAL GOVERNMENT

Administrative and general: Board·ofselectmen. : . $ 539 $ 539 $ 514 $ 25· Town clerk. , . 595 595 568 27.. AdmiiJistrative services . 96 96 94 2 Registrar ofvoters . 226 226 194 32 Zoning board ofappeals . 7 7 3 '4· Town planning and zoning commission .. 675 675 651 24· Probate court . 27 27 24 3· Historical district commission . 12 12 11 . I Conservation commission : . 1,029 1,052 973 79 Shellfish commission . 20 20 5 15· Legal servicl

Total Administrative and general . 14,342 14,532 14,311 221

Miscellaneous: Private agencies . 852 852 852 .Private school transportation . 1,287 1,287 1,265 22 Contingency ,..;: . 300 Preventative health grant.. . 7 7 Bio preparedness ;.. 76 76 Substance abuse prevention . 6 6

Total Miscellaneous .. 2,439 2,228 2,206 22

TOTAL GENERAL GOVERNMENT . 16,781 16,760 16,517 243

FINANCE

Finance . 949 999 968 31 Purchasing . 276 ..276 264 12 Assessor . 861 861 840 21 Tax collector . 667 667 628 39 Information systems . 1,560 1,620 1,592 28 ' Board offinance .. 85 85 84 1 Unemployment compensation . 125 199 199

TOTAL FINANCE ;. 4,523 4,707 4,575 132 (Continued)

66 SCHEDULE 3 (2 of 2) TOWN OF FAIRFIELD. CONNECTICUT GENERAL FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES (CONCLUDED) VARIANCE ORIGINAL FINAL WITH FINAL BUDGET BUDGET ACTUAL BUDGET

PUBLIC SAFTEY

Fire ...... Police ...... Animal control ...... Street lighting ...... Hydrant and water service...... Emergency management...... Flood and erosion control ...... Emergency commuuications ctr......

PUBLIC WORKS

public wbrks administration...... 577 577 556 21 Public works operations...... 12. 258 12. 239 11. 799 440 Building ...... 693 693 684 9 Engineering...... 724 724 696 28

TOTAL PUBLIC WORKS ...... 14. 252 14. 233 13. 735 498

HEALTH AND WELFARE

Health ...... 3. 002 3. 002 2. 947 55 Welfare...... 171 171 145 26 Human services...... 525 525 399 126 Solid waste & recycling...... 4. 203 4. 204 3. 529 675

TOTAL HEALTH AND WELFARE...... 7. 901 7. 902 7. 020 882

CULTURE AND RECREATION

Library...... Penfield pavillion complex...... Parks and recreation...... Beaches and lifeguards...... Golf courses ...... TOTAL CULTURE AND RECREATION...... BOARD OF EDUCATION...... DEBT SERVICE......

TOTAL EXPENDITURES......

OTHER FINANCING USES Transfers out .Debt Service Fund ...... Transfers out .Capital Projects Fund ...... TOTAL OTHER FINANCING USES ......

TOTAL EXPENDITURES AND OTHER . FINANCING USES ...... $ 247. 245 $ 247. 455 $ 245. 243 $ 2. 212 (Concluded) SCHEDULE 4

GENERAL FLTND BOARD OF EDUCATION SCHEDULE OF EXPENDITURES .BUDGET AND ACTUAL FOR THE YEAR ENDED JUNE 30. 2010 (THOUSANDS)

ORIGINAL FINAL UNEXPENDED APPROPRIATION TRANSFERS APPROPRIATION EXPENDITURES BALANCE

Salaries and wages: Teaching staff ...... Certified support staff...... School administrative staff ...... Central administrative staff...... Supervisorlmanagers...... Secretaridclerical staff ...... Paraprofessional staff ...... Custodian staff ...... Maintenance staff...... Support staff...... Info tech support...... SE trainers...... Part-time employment ...... Employee benefits ...... Instructional and other services ...... Utilities services...... Maintenance services ...... Rentals...... Student transportation...... Conference and travel ...... Professional development ...... Persomel/recruitment expenses...... Printing/copying/postage ...... Tuition...... Instructional supplies ...... Office, custodial and other supplies...... Textbook and library resources ...... Technology and capital outlay ...... Dues and fees ......

TOTAL ......

(This page intentionally left blank)

Appendix B

Form of Opinion of Bond Counsel

(This page intentionally left blank) Appendix B

FORM OF OPINION OF BOND COUNSEL TOWN OF FAIRFIELD, CONNECTICUT $41,380,000 GENERAL OBLIGATION BOND ANTICIPATION NOTES

July __, 2011

Town of Fairfield John J. Sullivan Independence Town Hall 725 Old Post Road Fairfield, Connecticut 06824

We have acted as Bond Counsel to the Town of Fairfield, Connecticut (the “Town”) in connection with the issuance by the Town of its $41,380,000 General Obligation Bond Anticipation Notes (the “Notes”) dated July 22, 2011. In such capacity, we have examined a record of proceedings of the Town authorizing the Notes, a Tax Compliance Agreement of the Town dated July __, 2011 (the “Agreement”), such law and such other proceedings, certifications, and documents as we have deemed necessary to render this opinion.

As to questions of fact material to our opinion we have relied upon the certified proceedings and other certifications of public officials furnished to us without undertaking to verify the same by independent investigation.

We are of the opinion that when the Notes are duly certified by U.S. Bank National Association, the Notes will be valid and binding general obligations of the Town payable as to both principal and interest from ad valorem taxes which may be levied on all taxable property subject to taxation by the Town without limitation as to rate or amount except as to classified property such as certified forest lands taxable at a limited rate and dwelling houses of qualified elderly persons of low income or of qualified disabled persons taxable at limited amounts pursuant to Connecticut statutes. We are further of the opinion that the Agreement is a valid and binding agreement of the Town and it was duly authorized by the Town.

The rights of the holders of the Bonds and the enforceability thereof may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’ rights generally and by equitable principles, whether considered at law or in equity.

The Internal Revenue Code of 1986, as amended (the "Code"), establishes certain requirements that must be met in and subsequent to the issuance and delivery of the Notes in order that interest on the Notes be excludable from gross income under Section 103 of the Code. In the Agreement, the Town has made covenants and representations designed to assure compliance with such requirements of the Code. The Town has covenanted in the Agreement that it will at all times comply with all requirements of the Code that must be satisfied subsequent to the issuance of the Notes to ensure that interest on the Notes shall not be included in gross income for Federal income tax purposes retroactive to the date of issuance of the Notes, including covenants regarding, among other matters, the use, expenditure and investment of the proceeds of the Notes.

In rendering the below opinions regarding the Federal treatment of interest on the Notes, we have relied upon and assumed (i) the material accuracy of the representations, statements of intention and reasonable expectations, and certifications of fact contained in the Agreement, and (ii) continuing compliance by the Town with the covenants set forth in the Agreement as to such tax matters.

B-1

In our opinion, under existing statutes and court decisions, (i) interest on the Notes is excludable from gross income for Federal income tax purposes pursuant to Section 103 of the Code; and (ii) such interest is not an item of tax preference for purposes of the Federal alternative minimum tax imposed on individuals and corporations; however, such interest is taken into account in determining adjusted current earnings for purposes of computing the Federal alternative minimum tax imposed on certain corporations. We express no opinion regarding other Federal income tax consequences caused by ownership or disposition of, or receipt of interest on the Notes.

We are further of the opinion that, under existing statutes, interest on the Notes is excludable from Connecticut taxable income for purposes of the Connecticut income tax on individuals, trusts and estates; and interest on the Notes is excludable from amounts on which the net Connecticut minimum tax is based in the case of individuals, trusts and estates required to pay the Federal alternative minimum tax. We express no opinion regarding other State income tax consequences caused by ownership or disposition of, or receipt of interest on the Notes.

We have not been engaged or undertaken to review the accuracy, completeness or sufficiency of the Official Statement dated July___, 2011, and other offering material relating to the Notes except to the extent stated in the Official Statement and we express no opinion relating thereto excepting only the matters set forth as our opinion in the Official Statement.

We have not undertaken to advise whether any events after the date of issuance of the Notes, including the adoption of Federal tax legislation, may affect the tax status of the Notes.

Respectfully,

PULLMAN & COMLEY, LLC

B-2

Appendix C

Form of Continuing Disclosure Agreement

(This page intentionally left blank) Appendix C

CONTINUING DISCLOSURE AGREEMENT FOR NOTES BY THE TOWN OF FAIRFIELD, CONNECTICUT

In Connection With The Issuance and Sale of $41,380,000 Town of Fairfield, Connecticut General Obligation Bond Anticipation Notes

This Continuing Disclosure Agreement (“Agreement”) is made as of July 22, 2011, by the Town of Fairfield, Connecticut (the “Issuer”) acting by its undersigned officers, duly authorized, in connection with the issuance of its $41,380,000 General Obligation Bond Anticipation Notes, dated July 22, 2011 and maturing on July 20, 2012 (the “Notes”).

Section 1. Definitions. In addition to the terms defined above, the following capitalized terms shall have the meanings ascribed thereto:

“EMMA” means the Electronic Municipal Market Access System as described in the 1934 Act Release #59062 and maintained by the Municipal Securities Rulemaking Board for the purposes of the Rule and as further described in Section 10 hereof.

“Final Official Statement” means the official statement of the Issuer dated July __, 2011 prepared in connection with the issuance of the Notes.

“Listed Events” shall mean any of the events listed in Section 2 of this Continuing Disclosure Agreement.

“MSRB” shall mean the Municipal Securities Rulemaking Board established pursuant to Section 15B(b)(1) of the Securities Exchange Act of 1934, as amended, or any successor thereto.

“Rule” means rule 15c2-12 under the Securities Exchange Act of 1934, as of the date of this Agreement.

“SEC” means the Securities and Exchange Commission of the United States, or any successor thereto.

Section 2. Event Notices.

(a) The Issuer agrees to provide or cause to be provided to the MSRB, within ten (10) days of the occurrence of any of the following events with respect to the Notes, notice of the occurrence of such event:

(i) principal and interest payment delinquencies;

(ii) unscheduled draws on debt service reserves reflecting financial difficulties;

(iii) unscheduled draws on credit enhancements reflecting financial difficulties;

(iv) substitution of credit or liquidity providers, or their failure to perform;

C-1 (v) adverse tax opinions, the issuance by the Internal Revenue Service or proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB), or other material notices or determinations with respect to the tax status of the Notes, or other events affecting the tax status of the security;

(vi) tender offers;

(vii) bankruptcy, insolvency, receivership, or a similar proceeding by the Issuer;

(viii) Note defeasances; and

(ix) rating changes.

(b) The Issuer agrees to provide or cause to be provided to the MSRB, within ten (10) days of the occurrence of any of the following events with respect to the Notes, notice of the occurrence of such event, if material:

(i) non-payment related defaults;

(ii) modifications to rights of Note holders;

(iii) Note calls;

(iv) release, substitution, or sale of property securing repayment of the Notes;

(v) consummation of a merger, consolidation, acquisition involving the Issuer, other than the ordinary course of business, or the sale of all or substantially all the assets of the Issuer, or the entry into a definitive agreement to engage in such a transaction, or a termination of such an agreement, other than in accordance with its terms; and

(vi) appointment of a successor or additional trustee, or the change in the name of the trustee.

Section 3. Termination of Reporting Obligation. The Issuer’s obligations under this Continuing Disclosure Agreement shall terminate upon the defeasance, prior redemption or payment in full of all of the Notes.

Section 4. Agent. The Issuer may, from time to time, appoint or engage an agent to assist it in carrying out its obligations under this Continuing Disclosure Agreement, and may discharge any such agent, with or without appointing a successor agent.

Section 5. Amendment; Waiver. Notwithstanding any other provision of this Continuing Disclosure Agreement, the Issuer may amend this Continuing Disclosure Agreement, and any provision of this Continuing Disclosure Agreement may be waived, if such amendment or waiver is made in connection with a change in circumstances that arises from a change in legal requirements, a change in law, or a change in the identity, nature or status of the Issuer, and is supported by an opinion of counsel expert in federal securities laws, to the effect that (i) such amendment or waiver would not materially adversely affect the beneficial owners of the Notes and (ii) the Agreement as so amended would have complied with the requirements of the Rule as of the date of the Agreement, taking in account any

C-2 amendments or interpretations of the Rule as well as any changes in circumstances. A copy of any such amendment will be filed in a timely manner with the MSRB. The annual financial information provided on the first date following adoption of any such amendment will explain, in narrative form, the reasons for the amendment and the impact of the change in the type of operating or financial information provided.

Section 6. Additional Information. Nothing in this Continuing Disclosure Agreement shall be deemed to prevent the Issuer from disseminating any other information, using the means of dissemination set forth in this Continuing Disclosure Agreement or any other means of communications, or including any other information in any annual report or notice of occurrence of a Listed Event, in addition to that which is required by this Continuing Disclosure Agreement. If the Issuer chooses to include any information in any annual report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Continuing Disclosure Agreement, the Issuer shall have no obligation under this Continuing Disclosure Agreement to update such information or include it in any future annual report or notice of occurrence of a Listed Event.

Section 7. Indemnification. The Issuer agrees to indemnify and save its officials, officers and employees harmless against any loss, expense and liabilities which they may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorney’s fees) of defending against any claim of liability hereunder, but excluding any such liabilities due to any such person’s malicious, wanton, or willful act. The obligations of the Issuer under this Section shall survive, notwithstanding that such person may no longer be serving in such capacity.

Section 8. Enforceability. The Issuer agrees that its undertaking pursuant to the Rule set forth in this Continuing Disclosure Agreement is intended to be for the benefit of and enforceable by the beneficial owners of the Notes. In the event the Issuer shall fail to perform its duties hereunder, the Issuer shall have the option to cure such failure after its receipt of written notice from any beneficial owner of the Notes of such failure. The present address of the Issuer is John J. Sullivan Independence Town Hall, 725 Old Post Road, Fairfield, Connecticut 06430. In the event the Issuer does not cure such failure, the right of any beneficial owner of the Notes to enforce the provisions of this undertaking shall be limited to a right to obtain specific enforcement of the Issuer’s obligations hereunder. No monetary damages shall arise or be payable hereunder nor shall any failure to comply with this Agreement constitute default of the Issuer with respect to the Notes.

Section 9. Governing Law. This Agreement shall be governed by the laws of the State of Connecticut.

Section 10. Method of Filing. To the extent filings are required to be made to the MSRB under this Agreement, the Issuer shall transmit such filings or notices in an electronic format to the continuing disclosure service portal provided through MSRB’s EMMA as provided at http://emma.msrb.org/ or any similar system that is acceptable to the SEC.

C-3

IN WITNESS WHEREOF, the Issuer has caused this Continuing Disclosure Agreement to be executed in its name by its undersigned officers, duly authorized, all as of the date first above written.

TOWN OF FAIRFIELD, CONNECTICUT

By: Michael C. Tetreau, First Selectman

By: Paul H. Hiller, Jr., Fiscal Officer

C-4

Appendix D

Notice of Sale and Bid Form

(This page intentionally left blank) Appendix D

NOTICE OF SALE TOWN OF FAIRFIELD, CONNECTICUT

$41,380,000 GENERAL OBLIGATION BOND ANTICIPATION NOTES Dated July 22, 2011 : Due July 20, 2012

Notice is given that electronic bids (as described herein) will be received by the TOWN OF FAIRFIELD, Connecticut (the “Town”), for the purchase of $41,380,000 Town of Fairfield, Connecticut General Obligation Bond Anticipation Notes (the “Notes”). All bids must be submitted on Grant Street Group’s MuniAuction website (“MuniAuction”) located at website address www.grantstreet.com between 11:30 A.M. and 11:45 A.M. (E.D.T.) on Thursday

July 14, 2011

(the “Bid Date”) for the purchase of the Notes which mature on July 20, 2012. To bid, bidders must have: (1) completed the registration form on either the MuniAuction website or any municipal debt auction website powered by MuniAuction, and (2) requested and received admission to the Town’s auction (as described under “Electronic Bidding Procedure - Registration and Admission to Bid” below). The use of MuniAuction shall be at the bidders’ risk and expense, and the Town shall have no liability with respect to its use by the bidders. No other method of submitting bids will be accepted.

The Issue

The full faith and credit of the Town of Fairfield will be pledged for the prompt payment of the principal of and the interest on the Notes. The Notes will be general obligations of the Town payable, unless paid from other sources, from ad valorem taxes which may be levied on all taxable property subject to taxation by the Town without limit as to rate or amount except as to classified property such as certified forest land taxable at a limited rate and dwelling houses of qualified elderly persons of low income or of qualified disabled persons taxable at limited amounts pursuant to Connecticut General Statutes, as amended. The Notes will be dated July 22, 2011 and will be payable to the registered owners on July 20, 2012. The Notes will bear interest (computed on a 360-day year, 30-day month basis) payable at maturity at the rate or rates per annum fixed in the proposal accepted for their purchase, which rates shall be in multiples of 1/100 of 1% per annum. The information in this Notice of Sale is only a brief summary of certain provisions of the Notes. For further information about the Notes, reference is hereby made to the Preliminary Official Statement dated July __, 2011.

The Notes are NOT subject to redemption prior to maturity.

Ratings

The Town has applied to Standard & Poor’s Corporation for assignment of their municipal bond rating to the Notes. The assigned rating may be obtained from the rating agency.

Official Statement and Continuing Disclosure Agreement

The Town has prepared a Preliminary Official Statement for the Notes which is dated July __, 2011, which is deemed final as of its date for purposes of SEC Rule 15c2-12(b)(1), except for omissions permitted thereby, but is subject to revision or amendment. The winning bidder will be furnished 10 copies of the Official Statement at the Town's expense. Additional copies may be obtained by the winning bidder at its own expense by arrangement with the Town’s financial advisor. The copies of the

D-1 Official Statement will be made available to the winning bidder not later than seven (7) business days after the bid opening.

The purchaser agrees to promptly file a final Official Statement with the Municipal Securities Rulemaking Board and to take any and all other actions necessary to comply with applicable Securities and Exchange Commission and Municipal Securities Rulemaking Board rules governing the offering, sale and delivery of the Notes to the ultimate purchasers.

The Town will enter into a Continuing Disclosure Agreement with respect to the Notes, substantially in the form attached as Appendix C to the Official Statement (the “Continuing Disclosure Agreement”), to provide or cause to be provided, in accordance with the requirements of SEC Rule 15c2- 12(b)(5), timely notice of the occurrence of certain material events with respect to the Notes. The winning bidder’s obligation to purchase the Notes shall be conditioned upon its receiving, at or prior to the delivery of the Notes, an executed copy of the Continuing Disclosure Agreement for the Notes.

Electronic Bidding Procedure

Registration and Admission to Bid

To bid, bidders must first visit the MuniAuction website at “www.grantstreet.com” where, if they have never registered with either MuniAuction or any municipal debt auction website powered by MuniAuction, they can register and then request admission to bid in the auction for the Notes. Bidders will be notified prior to the scheduled bidding time of their eligibility to bid. Only NASD registered broker- dealers and dealer banks with DTC clearing arrangements will be eligible to bid. Bidders who have previously registered with MuniAuction may call MuniAuction at (412) 391-5555 for their ID Number or password. The Town will determine whether any request for admission is granted.

Bidding Procedures

All bids must be submitted electronically on the MuniAuction website at www.grantstreet.com. No telephone, telefax, telegraph or personal delivery bids will be accepted. Bidders may change and submit bids as many times as they wish during the auction; provided, however, that each bid submitted subsequent to a bidder’s initial bid must result in a lower net interest cost (“NIC”) on the Notes when compared to the immediately preceding bid of such bidder. The last bid submitted by a bidder before the end of the auction will be compared to all other final bids submitted by others to determine the winning bidder(s). During the bidding, no bidder will see any other bidder’s bid but each bidder will be able to see its ranking (i.e., “Leader”, “Cover”, “3rd”, etc.).

If any bid becomes a leading bid within two minutes prior to the scheduled end of the bidding, then the time period for submission of bids will automatically extend by two (2) minutes from the time such new leading bid was received ( the “Two-Minute Rule”). The Two-Minute Rule will remain in effect as long as bids received by MuniAuction meet the requirements of the Two-Minute Rule described herein.

Bidders should verify the accuracy of their final bids and compare them to the winning bid reported on the MuniAuction Observation Page immediately after the auction.

D-2 Rules of MuniAuction

The “Rules of MuniAuction” can be viewed on the MuniAuction website at www.grantstreet.com and are incorporated by reference in this official Notice of Sale. Bidders must comply with the Rules of MuniAuction in addition to the requirements of this official Notice of Sale. In the event the Rules of MuniAuction conflict with this official Notice of Sale, this official Notice of Sale shall prevail.

An electronic bid shall be deemed an irrevocable offer to purchase the Notes on the terms provided in the Notice of Sale, and shall be binding upon the bidder. Separate proposals to purchase any part of the Notes may be contained in the same electronic bid as a convenience to the bidder. If more than one electronic bid shall be submitted by the same bidder for any part of the Notes, each such bid shall be considered a separate proposal for purchase of such part. The Town shall not be responsible for any malfunction or mistake made by, or as a result of the use of the facilities of MuniAuction, the use of such facilities being the sole risk of the prospective bidder.

For purposes of the electronic bid process, the time as maintained on the MuniAuction website shall constitute the official time. For information purposes only, bidders are requested to state in their electronic bids the net interest cost to the Town, as described in this Notice of Sale. All electronic bids shall be deemed to incorporate the provisions of this Notice of Sale.

Bid Specifications, Award, Delivery and Payment

Proposals for the purchase of the Notes must be submitted in accordance with the requirements prescribed herein and by the Rules of MuniAuction. A proposal may be for all or any part of the Notes but any proposal for a part must be for a whole multiple of $100,000, except that one such proposal for a part may include the odd $80,000 of principal amount. A separate proposal will be required for each part of the Notes for which a separate interest rate is bid.

Unless all bids are rejected, the Notes will be awarded on the basis of the lowest net interest cost, computed as to each interest rate stated by adding the total interest which will be paid at such rate and deducting therefrom any premium offered. As between proposals resulting in the same lowest net interest cost, the award will be made on the basis of the highest principal amount of the Notes specified. In the event that two or more bidders offer bids at the same lowest net interest cost and the same principal amount, the Town will determine by lot which of such bidders will be awarded the Notes. No bid for less than par and accrued interest, if any, will be considered and the Town reserves the right to award to any bidder(s) all or any part of the Notes bid for in its proposal. If a bidder is awarded only a part of the Notes bid for in its proposal, any premium offered in such proposal will be proportionately reduced so that the net interest cost shall be the same as in the bidder’s proposal with respect to the amount bid, carried to four places. The purchase price must be paid in Federal Funds.

Promptly upon verbal notification that a bidder’s proposal may be accepted, the bidder shall confirm to the Town the reoffering prices of the Notes.

Bids will be finally accepted or rejected promptly after opening and not later than 3:00 p.m. (E.D.T.) on the Bid Date in accordance with the provisions herein.

Simultaneously with or before delivery of the Notes, the purchaser shall furnish to the Town a certificate acceptable to Bond Counsel for the Town to the effect that the purchaser has either purchased the Notes at the prices shown on such certificate for investment and not with a view toward distribution or resale and not in the capacity of a bond house, broker or other intermediary or has made a bona fide public offering of the Notes to the public (i) at initial offering prices not greater than, or yields not lower than, the respective prices or yields shown on the certificate, and (ii) a substantial amount of the Notes was sold to the final purchasers thereof (not including bond houses and brokers or similar persons or D-3 organizations acting in the capacity of underwriters or wholesalers) at prices not greater than or yields not lower than, such offering prices or yields. Bond Counsel advises that (i) such certificates must be made on the best knowledge, information and belief of the purchaser, (ii) the sale to the public of 10% or more of the Notes at prices not greater than or yields not lower than, the initial offering prices or yields would be sufficient for the purpose of certifying as to the sale of a substantial amount of the Notes and (iii) reliance on other facts as a basis for such certification would require evaluation by Bond Counsel to assure compliance with the statutory requirement.

At or prior to the delivery of the Notes the successful bidder shall be furnished, without cost, with the approving opinion of Pullman & Comley, LLC, of Bridgeport, Connecticut, Bond Counsel, substantially in the form set out in Appendix B to the Official Statement. The successful bidder will also be furnished with a receipt of payment for the Notes, a Signature and No Litigation Certificate, dated as of the date of delivery of the Notes, stating that there is no litigation pending, or to the knowledge of the signers thereof, threatened, affecting the validity of the Notes or the power of the Town to levy and collect taxes to pay them. A signed copy of the Official Statement prepared for this Note issue will also be furnished together with a certificate of Town Officials relating to the accuracy and completeness of the Official Statement.

The Notes will NOT be designated by the Town as qualified tax exempt obligations under the provisions of Section 265(b) of the Internal Revenue Code of 1986, as amended, for purposes of the deduction by financial institutions for interest expense allocable to the Notes.

The Town will have no responsibility to pay for any expenses of the purchaser except to the extent specifically stated in this Notice of Sale. The purchaser will have no responsibility to pay for any of the Town’s costs of issuance except to the extent specifically stated in this Notice of Sale.

The purchaser will be responsible for the clearance or exemption with respect to the status of the Notes for sale under securities or “Blue Sky” laws and the preparation of any surveys or memoranda in connection with such sale. The Town shall have no responsibility for such clearance, exemption or preparation.

It is expected that the Notes will be delivered to DTC in New York City on or about July 22, 2011 against payment in immediately available Federal Funds. The deposit of the Notes with DTC under a book-entry system requires the assignment of CUSIP numbers prior to delivery. It shall be the responsibility of the winning bidder or bidders to obtain CUSIP numbers for the Notes prior to delivery and the Town will not be responsible for any delay occasioned by the inability to deposit the Notes with DTC due to the failure of the winning bidder or bidders to obtain such numbers and to supply them to the Town in a timely manner. The Town assumes no responsibility for any CUSIP Service Bureau charge or other charges that may be imposed for the assignment of such numbers, which charges shall be the responsibility of and shall be paid for by the purchaser.

Right to Reject Bids; Waiver

The right is reserved to reject any and all proposals and to reject any proposal not complying with this Notice of Sale and to waive any irregularity or informality with respect to any proposal.

Postponement; Change of Terms

The Town reserves the right to alter any terms of the Notes or this Notice of Sale and to postpone, from time to time, the date or time established for the receipt of the bids.

D-4 Book-Entry-Only Form

The Notes will be issued by means of a book-entry system with no physical distribution of certificates made to the public. The Notes will be issued in registered form and one note certificate for each interest rate will be issued to DTC, registered in the name of its nominee, Cede & Co., and immobilized in their custody. A book-entry system will be employed, evidencing ownership of the Notes in principal amounts of $5,000 or integral multiples thereof, with transfers of ownership effected on the records of DTC and its Participants pursuant to rules and procedures adopted by DTC and its Participants. The successful bidder or bidders, as a condition to delivery of the Notes, will be required to deposit the note certificates with DTC, registered in the name of Cede & Co. Principal of and interest on the Notes will be payable by the Town or its agent in Federal funds to DTC or its nominee as registered owner of the Notes. Principal and interest payments to Participants of DTC will be the responsibility of DTC. Principal and interest payments to Beneficial Owners by Participants of DTC will be the responsibility of such Participants and other nominees of Beneficial Owners. The Town will not be responsible or liable for payments by DTC to its Participants or by DTC Participants to Beneficial Owners or for maintaining, supervising or reviewing the records maintained by DTC, its Participants or persons acting through such Participants.

In the event that (a) DTC determines not to continue to act as securities depository for the Notes and the Town fails to identify another qualified securities depository to replace DTC, or (b) the Town determines to discontinue the book-entry system of evidence and transfer of ownership of the Notes, the Town will authenticate and deliver replacement Notes in the form of fully registered Note certificates directly to the Beneficial Owners of the Notes or their nominees.

Additional Information

For more information regarding the Notes and the Town, reference is made to the Preliminary Official Statement dated July __, 2011. Bid forms and copies of the Official Statement may be obtained from Paul H. Hiller, Jr., Fiscal Officer, Town of Fairfield (203) 256-3065 or from Matthew Spoerndle, Managing Director, Phoenix Advisors, LLC, 53 River Street, Suite 3, Milford, Connecticut 06460, (203) 878-4945.

Michael C. Tetreau, First Selectman Paul H. Hiller, Jr., Fiscal Officer

July __, 2011

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