OFFICIAL STATEMENT RATINGS: (See ‘RATINGS’ herein) Fitch: “AAA (negative outlook)” Moody's Investors Service, Inc.: “Aa1” Standard & Poor's: “AA+ (stable outlook)” NEW ISSUE SERIAL BONDS

In the opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the County, based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, the accuracy of certain representations and compliance with certain covenants, interest on the Series A Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986. In the further opinion of Bond Counsel, interest on the Series A Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, nor is it included in adjusted current earnings when calculating corporate alternative minimum taxable income. Bond Counsel is of the opinion that interest on the Series B Bonds and the Recovery Zone Bonds is not excluded from gross income for federal income tax purposes. Bond Counsel is also of the opinion that interest on the Bonds is exempt from personal income taxes imposed by the State of New York and any political subdivision thereof (including The City of New York). Bond Counsel expresses no opinion regarding any other tax consequences related to the ownership or disposition of, or the accrual or receipt of interest on, the Bonds. See "TAX MATTERS" herein.

The Bonds will NOT be designated "qualified tax-exempt obligations" pursuant to Section 265(b)(3) of the Code.

COUNTY OF ONONDAGA, NEW YORK $31,150,000 General Obligation (Serial) Bonds, 2010 Series A (Tax-Exempt) CUSIP BASE†: 682745 Dated: Date of Delivery Due: June 15, 2012-2019 (hereinafter referred to as the "Series A Bonds") MATURITIES Interest Interest Interest Year Amount Yield CSP† Year Amount Yield CSP† Year Amount Yield CSP† Rate Rate Rate 2012 $4,425,000 4.00% 0.64% T79 2015 $5,100,000 5.00% 1.73% U28 2018 $3,050,000 5.00% 2.71% U51 2013 4,950,000 4.00 1.05 T87 2016 3,000,000 5.00 2.14 U36 2019 3,000,000 5.00 2.93 U69 2014 4,625,000 5.00 1.38 T95 2017 3,000,000 5.00 2.46 U44

$17,570,000 General Obligation (Serial) Bonds, 2010 Series B (Federally Taxable Build America Bonds) CUSIP BASE†: 682745 Dated: Date of Delivery Due: June 15, 2020-2026 (hereinafter referred to as the "Series B Bonds") MATURITIES Interest Interest Interest Year Amount Yield CSP† Year Amount Yield CSP† Year Amount Yield CSP† Rate Rate Rate 2020 $3,000,000* 4.25% 4.25% U77 2022 $2,800,000* 4.65% 4.65% U93 2025 $2,450,000* 5.05% 5.05% V43 2021 2,800,000* 4.50 4.50 U85 2023 2,800,000* 4.80 4.80 V27 2026 1,220,000* 5.15 5.15 V50 2024 2,500,000* 4.95 4.95 V35

* The Bonds maturing in the years 2020-2026 are subject to redemption prior to maturity as described herein under the heading “Optional Redemption – Series A Bonds”. PIPER JAFFRAY & CO.

$4,905,000 General Obligation (Serial) Bonds, 2010 (Federally Taxable – Recovery Zone Bonds) CUSIP BASE†: 682745 Dated: Date of Delivery Due: June 15, 2027-2030 (hereinafter referred to as the "Recovery Zone Bonds") MATURITIES Interest Interest Interest Year Amount Yield CSP† Year Amount Yield CSP† Year Amount Yield CSP† Rate Rate Rate 2027 $1,225,000* 5.50% 5.35% V68 2028 $1,225,000* 5.75% 5.50% V76 2030 $1,230,000* 5.90% 5.70% V92 2029 1,225,000* 5.875 5.60 V84

* The Bonds maturing in the years 2027-2030 are subject to redemption prior to maturity as described herein under the heading “Optional Redemption – Recovery Zone Bonds”.

(collectively hereinafter referred to as the "Recovery Zone Bonds")

MORGAN KEEGAN & CO., INC.

The Bonds are general obligations of the County of Onondaga, New York, all the taxable real property within which is subject to the levy of ad valorem taxes to pay the Bonds and interest thereon, without limitation as to rate or amount.

The County intends to make irrevocable elections to treat the Series B Bonds as "Federally Taxable Build America Bonds" under the Internal Revenue Code of 1986, as amended (the "Code") for which it will receive, a cash subsidy payment from the United States Treasury equal to thirty-five percent (35%) of the interest payable by the County on the Series B Bonds. The County will elect to receive the tax credit payment pursuant to the Code. It is expected that any cash subsidy payments received will be deposited, upon receipt, to the credit of the County.

The County intends to make irrevocable elections to treat the Recovery Zone Bonds as "Recovery Zone Economic Development Bonds" under the Internal Revenue Code of 1986, as amended (the "Code") for which it will receive, a cash subsidy payment from the United States Treasury equal to forty-five percent (45%) of the interest payable by the County on the Recovery Zone Bonds. The County will elect to receive the tax credit payment pursuant to the Code. It is expected that any cash subsidy payments received will be deposited, upon receipt, to the credit of the County.

The Bonds will be issued as registered bonds and will be registered in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"), New York, New York, which will act as securities depository for the Bonds. Individual purchases will be made in book-entry form only, in the principal amount of $5,000 or integral multiples thereof. Purchasers will not receive certificates representing their ownership interest in the Bonds. Interest on the Bonds will be payable on June 15, 2011, December 15, 2011 and semi-annually thereafter on June 15 and December 15 in each year until maturity. Principal and interest will be paid by the County to DTC, which will in turn remit such principal and interest to its Participants, for subsequent distribution to the Beneficial Owners of the Bonds, as described herein.

The Bonds are offered when, as and if issued and received by the purchaser and subject to the receipt of the unqualified legal opinion as to the validity of the Bonds of Orrick, Herrington & Sutcliffe LLP, New York, New York, Bond Counsel. It is anticipated that the Bonds will be available for delivery in New York, New York or as may be agreed upon on or about June 29, 2010.

June 15, 2010

THIS REVISED COVER SUPPLEMENTS THE OFFICIAL STATEMENT OF THE COUNTY DATED JUNE 9, 2010 RELATING TO THE OBLIGATIONS THEREOF DESCRIBED THEREIN AND HEREIN BY INCLUDING CERTAIN INFORMATION OMITTED FROM SUCH OFFICIAL STATEMENT IN ACCORDANCE WITH SECURITIES AND EXCHANGE COMMISSION RULE 15c2-12. OTHER THAN AS SET FORTH ON THE REVISED COVER, THE REVISION OF THE “OPTIONAL REDEMPTION” SECTION AND THE REVISIONS OF TWO “FORM OF BOND COUNSEL’S OPINION” AS WELL AS THE ADDITION OF ANOTHER “FORM OF BOND COUNSEL’S OPINION”, THERE HAVE BEEN NO REVISIONS TO SAID OFFICIAL STATEMENT.

† Copyright 2009, American Bankers Association. CUSIP data herein is provided by Standard & Poor’s, CUSIP Service Bureau, a division of The McGraw- Hill Companies, Inc. This data is not intended to create a database and does not serve in any way as a substitute for the CUSIP Service. The CUSIP number is provided for convenience of reference only. Neither the County, nor the Financial Advisor take any responsibility for the accuracy of such CUSIP.

COUNTY OFFICIALS

JOANNE M. MAHONEY JAMES M. RHINEHART County Executive Chairman, County Legislature

WILLIAM FISHER ROBERT E. ANTONACCI, II, CPA, ESQ. Deputy County Executive County Comptroller

JAMES ROWLEY M. ANN CIARPELLI Chief Fiscal Officer County Clerk

KEVIN E. WALSH GORDON CUFFY, ESQ. Sheriff County Attorney

WILLIAM J. FITZPATRICK, ESQ. District Attorney

FINANCIAL ADVISORS

Fiscal Advisors & Marketing, Inc. Government Finance Associates, Inc. 120 Walton Street, Suite 600 590 Madison Avenue, 21st Floor Syracuse, New York 13202 New York, New York 10022 (315) 752-0051 (212) 521-4090

BOND COUNSEL

Orrick, Herrington & Sutcliffe LLP 51 West 52nd Street New York, New York 10019 (212) 506-5151

No person has been authorized by the County of Onondaga to give any information or to make any representations not contained in this Official Statement, and, if given or made, such information or representations must not be relied upon as having been authorized. This Official Statement does not constitute an offer to sell or solicitation of an offer to buy any of the Bonds in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation in such jurisdiction. The information, estimates and expressions of opinion herein are subject to change without notice, and 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 County of Onondaga.

TABLE OF CONTENTS Page Page DESCRIPTION OF THE BONDS...... 4 COUNTY INDEBTEDNESS...... 34 Optional Redemption ...... 4 Constitutional Requirements ...... 34 Book-Entry-Only System...... 6 Statutory Procedure...... 34 Certificated Bonds...... 8 Debt Outstanding End of Fiscal Year...... 35 Purposes of Issue...... 8 Debt Management ...... 35 THE COUNTY...... 9 Details of Outstanding Indebtedness...... 36 General Information ...... 9 Bonded Indebtedness as of November 30, 2009 ...... 37 Governmental Organization ...... 9 Estimate of Obligations to be Issued...... 38 Transportation ...... 9 Rate of Principal Retirement...... 38 Air ...... 9 Calculation of Total Net Indebtedness ...... 39 Rail...... 9 Bonded Debt of Political Subdivisions Within The County.. 40 Water...... 10 Debt Ratios...... 41 Highways ...... 10 Bonded Debt Service...... 41 Bus ...... 10 Higher Education ...... 10 SPECIAL PROVISIONS AFFECTING Health and Medicine ...... 10 REMEDIES UPON DEFAULT ...... 41 Culture and Recreation...... 11 MARKET AND RISK FACTORS...... 42 Conventions and Tourism ...... 12 Population Trends ...... 12 LITIGATION ...... 42 Unemployment Rate Statistics ...... 13 Self-Insurance ...... 42 Labor Market Statistics ...... 13 Tax Certiorari Claims...... 42 Labor Force Statistics in Onondaga County...... 14 Onondaga Lake ...... 43 Major Employers...... 14 Onondaga Nation Land Claim...... 44 Commercial Banking...... 15 Allied Case...... 45 Economic Development ...... 15 FINANCIAL STRUCTURE...... 20 ONONDAGA COUNTY RESOURCE RECOVERY AGENCY...46 Budgetary Procedures ...... 20 TAX MATTERS...... 47 Budget Monitoring and Fiscal Controls ...... 20 County Budget ...... 21 LEGAL MATTERS ...... 51 Investment Policy...... 21 CONTINUING DISCLOSURE UNDERTAKING...... 51 State Aid...... 22 Employees...... 22 FINANCIAL ADVISORS...... 52 Pension Payments...... 23 RATINGS ...... 52 GASB 45 and Other Post-employment Benefits (OPEB)..... 24 Other Information...... 24 ADDITIONAL INFORMATION ...... 52 Data Security...... 25 Financial Statements ...... 25 APPENDIX - A Accounting Practices...... 25 GENERAL FUND - Balance Sheets Fund Structure...... 25 Revenues ...... 26 APPENDIX - A1 Local Revenue...... 26 GENERAL FUND – Changes in Fund Balance Expenditures...... 26 Fund Balance...... 26 APPENDIX - A2 2010-2015 Capital Improvement Plan...... 27 GENERAL FUND – Changes in Fund Balance - Budget TAX INFORMATION...... 28 Municipal Subdivisions in the County ...... 28 APPENDIX - B Full Value and County Property Tax Levy ...... 29 BONDED DEBT SERVICE Tax Collection Record ...... 29 County Tax Collection Rates for the City of Syracuse ...... 30 APPENDIX - C Accumulated County Tax Collection Rates for the COMPREHENSIVE ANNUAL FINANCIAL REPORT– County & City...... 30 December 31, 2009 Largest Taxpayers- 2009 Assessment Roll ...... 30 Constitutional Tax Margin ...... 31 APPENDIX – D-F Tax Collection Procedure...... 31 FORMS OF BOND COUNSEL’S OPINIONS Tax Lien Sale ...... 32 Payments In-Lieu of Taxes (“PILOTS”)...... 32 Onondaga County Sales Tax-Agreement Expiring 12/31/10 ...... 32 Onondaga County Sales Tax-New Agreement Effective 1/1/11-12/31/20...... 32

OFFICIAL STATEMENT of the COUNTY OF ONONDAGA, NEW YORK

Relating To $31,150,000 General Obligation (Serial) Bonds, 2010 Series A, $17,570,000 General Obligation (Serial) Bonds, 2010 Series B and $4,905,000 General Obligation (Serial) Bonds, 2010 (Federally Taxable – Recovery Zone Bonds)

This Official Statement, which includes the cover page, has been prepared by the County of Onondaga, New York (the “County”, and “State”, respectively) in connection with the sale by the County of $31,150,000 principal amount of General Obligation (Serial) Bonds, 2010 Series A (hereinafter referred to as the "Series A Bonds"), of $17,570,000 principal amount General Obligation (Serial) Bonds, 2010 Series B (Federally Taxable Build America Bonds) (hereinafter referred to as the “Series B Bonds”) and of $4,905,000 principal amount of General Obligation (Serial) Bonds, 2010 Recovery Zone (Federally Taxable – Recovery Zone Bonds) (hereinafter referred to as the "Recovery Zone Bonds" (collectively referred to hereinafter as the “Bonds”).

The factors affecting the County’s financial condition and the Bonds are described throughout this Official Statement. In as much as many of these factors, including economic and demographic factors, are complex and may influence the County tax base, revenues, and expenditures, this Official Statement should be read in its entirety, and no one factor should be considered more or less important than any other by reason of its relative position in this Official Statement.

All quotations from and summaries and explanations of provisions of the Constitution and laws of the State and acts and proceedings of the County contained herein do not purport to be complete and are qualified in their entirety by reference to the official compilations thereof, and all references to the Bonds and the proceedings of the County relating thereto are qualified in their entirety by reference to the definitive forms of the Bonds and such proceedings.

DESCRIPTION OF THE BONDS

The Bonds are general obligations of the County, and will contain a pledge of its faith and credit for the payment of the principal of and interest on the Bonds as required by the Constitution and laws of the State (State Constitution, Art. VIII, Section 2; Local Finance Law, Section 100.00). All the taxable real property within the County is subject to the levy of ad valorem taxes to pay the Bonds and interest thereon, without limitation as to rate or amount.

The Bonds will be dated the date of delivery and will be issued as registered bonds and, when issued, will be registered in the name of Cede & Co., as nominee of DTC, which will act as securities depository for the Bonds. Individual purchases will be made in book-entry form only, in the principal amount of $5,000 or integral multiples thereof. Purchasers will not receive certificates representing their ownership interest in the Bonds. Interest on the Bonds will be payable on June 15, 2011, December 15, 2011 and semi-annually thereafter on June 15 and December 15 in each year until maturity. Principal and interest will be paid by the County to the DTC, which will in turn remit such principal and interest to its Participants, for subsequent distribution to the Beneficial Owners of the Bonds, as described herein.

Optional Redemption

Optional Redemption for Series A Bonds

The Series A Bonds are not subject to optional redemption prior to their stated maturities.

4

Extraordinary Optional Redemption for Taxable Series A Bonds and Recovery Zone Bonds

Before June 15, 2020, Series B Bonds and Recovery Zone Bonds are subject to redemption on any date prior to their maturity at the option of the County, in whole or in part upon the occurrence of an Extraordinary Event, as defined below, at a redemption price equal to the greater of:

(1) 100% of the principal amount of the taxable Series B Bonds and Recovery Zone Bonds to be redeemed; or

(2) the sum of the present value of the remaining scheduled payments of principal and interest to the maturity date of the Series B Bonds and Recovery Zone Bonds to be redeemed, not including any portion of those payments of interest accrued and unpaid as of the date on which the Series B Bonds and Recovery Zone Bonds are to be redeemed, discounted to the date on which the Series B Bonds and Recovery Zone Bonds are to be redeemed on a semi-annual basis, assuming a 360-day year consisting of twelve 30-day months, at the Treasury Rate, plus 100 basis points;

plus, in each case, accrued interest on the Series B Bonds and Recovery Zone Bonds to be redeemed to the redemption date.

An “Extraordinary Event” will have occurred if the County determines that a material adverse change has occurred to Section 54AA or 6431 of the Code (as such Sections were added by Section 1531 of the Recovery Act, pertaining to “Build America Bonds”) or there is any guidance published by the Internal Revenue Service or the United States Department of the Treasury with respect to such Sections or any other determination by the Internal Revenue Service or the United States Department of the Treasury, which determination is not the result of any act or omission by the County to satisfy the requirements to qualify to receive the 35% with respect to the Series B Bonds and 45%, with respect to the Recovery Zone Bonds, cash subsidy payment from the United States Department of the Treasury, pursuant to which the County’s 35% with respect to the Series B Bonds and 45%, with respect to the Recovery Zone Bonds, cash subsidy payment from the United States Department of the Treasury is reduced or eliminated.

“Treasury Rate” means, with respect to any redemption date for a particular taxable Series B Bonds and Recovery Zone Bonds, the yield to maturity as of such redemption date of United States securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519)) that has become publicly available at least two business days prior to the redemption date (excluding inflation indexed securities or, if such Statistical Release is no longer published, any publicly available source of similar market data) most nearly equal to the period from the redemption date to the maturity date of the Series B Bonds and Recovery Zone Bonds to be redeemed; provided, that if the period from the redemption date to the maturity date is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used.

Optional Redemption for Series B Bonds and Recovery Zone Bonds

The Series B Bonds and Recovery Zone Bonds that mature on or after June 15, 2020 will be subject to redemption in whole or in part at any time on or after June 15, 2019 at the option of the County, at 100% of the par amount plus accrued interest through the date of redemption. If less than all of the Series B Bonds and Recovery Zone Bonds of a particular maturity are called for redemption, DTC or any successor securities depository will select the Series B Bonds and Recovery Zone Bonds to be redeemed pursuant to its rules and procedures or, if book-entry system is discontinued, will be selected by the County's Chief Fiscal Officer, who has been appointed registrar (the "Registrar"), by lot in such manner as the Registrar in its discretion may determine. The County will cause notice of the call for redemption identifying the Series B Bonds and Recovery Zone Bonds or portions thereof to be redeemed to be sent by facsimile transmission, registered or certified mail or overnight express delivery, not less than 30 nor more than 60 days prior to the redemption date, to the registered owner thereof. The County shall not be responsible for mailing notice of redemption to anyone other than DTC or another qualified securities depository or its nominee unless no qualified securities depository is the registered owner of the Series B Bonds and Recovery Zone Bonds. If no qualified securities depository is the registered owner of the Series B Bonds and Recovery Zone Bonds, notice of redemption shall be mailed to the registered owners of the Series B Bonds and Recovery Zone Bonds. If a portion of a Series B Bonds and Recovery Zone Bond is called for redemption, a new bond in principal amount equal to the unredeemed portion shall be issued to the registered owner upon the surrender thereof.

5

Selection of Bonds to be Redeemed in Partial Redemption

The following provisions shall apply to the Series B Bonds and Recovery Zone Bonds:

So long as the Series B Bonds and Recovery Zone Bonds are registered in book-entry-only form and so long as DTC or a successor securities depository is the sole registered owner of the Series B Bonds and Recovery Zone Bonds, partial redemptions will be done in accordance with DTC procedures. It is the County’s intent that DTC, the DTC Participants and such other intermediaries that may exist between the County and the beneficial owners effect a pro rata reduction of principal (subject to minimum authorized denomination restrictions and DTC procedures) of all outstanding Series B Bonds and Recovery Zone Bonds according to the beneficial interest in the Series B Bonds and Recovery Zone Bonds that DTC records list as owned by each DTC Participant as of the record date for such payment. However, the County can provide no assurance that DTC, the DTC Participants or any other intermediaries will allocate redemptions or reductions in principal among beneficial owners on such a proportional basis.

If the Series B Bonds and Recovery Zone Bonds are no longer registered in book-entry-only form, any redemption of less than all of the Series B Bonds and Recovery Zone Bonds of any maturity will be allocated among the registered owners of such Series B Bonds and Recovery Zone Bonds as nearly as practicable in proportion to the principal amounts of the Series B Bonds and Recovery Zone Bonds of such maturity owned by each registered owner, subject to the authorized denominations applicable to the Series B Bonds and Recovery Zone Bonds. This will be calculated based on the formula: (principal amount of applicable maturity to be redeemed) x (principal amount of applicable maturity owned by owner) / (principal amount of applicable maturity outstanding). The particular Series B Bonds and Recovery Zone Bonds to be redeemed will be determined by the Paying Agent, using such method as it deems fair and appropriate.

Notice of Redemption

The County will cause notice of the call for redemption identifying the Bonds or portions thereof to be redeemed to be sent by facsimile transmission, registered or certified mail or overnight express delivery, not less than 30 nor more than 60 days prior to the redemption date, to the registered owner thereof. The County shall not be responsible for mailing notice of redemption to anyone other than DTC or another qualified securities depository or its nominee unless no qualified securities depository is the registered owner of the Bonds. If no qualified securities depository is the registered owner of the Bonds, notice of redemption shall be mailed to the registered owners of the Bonds. If a portion of a Bond is called for redemption, a new Bond in principal amount equal to the unredeemed portion shall be issued to the registered owner upon the surrender thereof.

Book-Entry-Only System

The Depository Trust Company (“DTC”), New York, NY, will act as securities depository for the Bonds. The Bonds will be issued as fully-registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Bond certificate will be issued for each maturity of each series of the Bonds.

DTC 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, in turn, is owned by a number of Direct Participants of DTC and Members of the National Securities Clearing Corporation, Government Securities Clearing Corporation, MBS Clearing Corporation, and Emerging Markets Clearing Corporation, (NSCC, GSCC, MBSCC, and EMCC, also subsidiaries of DTCC), as well as by the New York Stock Exchange, Inc., the American Stock Exchange LLC, and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC has 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. 6

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

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

Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time.

Redemption notices shall be sent to DTC. If less than all of the Bonds within an issue are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

Principal and interest payments on the Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts 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 or the County, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal and interest to DTC is the responsibility of the County, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

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

The County may decide to discontinue use of the system of book-entry transfers through DTC (or a successor securities depository). In that event, Bond 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 County believes to be reliable, but the County takes no responsibility for the accuracy thereof.

Source: The Depository Trust Company.

7

Certificated Bonds

DTC may discontinue providing its services with respect to the Bonds at any time by giving reasonable notice to the County and discharging its responsibilities with respect thereto under applicable law, or the County may terminate its participation in the system of book-entry-only transfers through DTC at any time. In the event that such book-entry-only system is discontinued, the following provisions will apply: the Bonds will be issued in fully registered form in denominations of $5,000 each or any integral multiple thereof for any single maturity. Principal of the Bonds when due will be payable upon presentation at the office of the fiscal agent bank or trust company to be named by the County upon termination of the book- entry-only system. Interest on the Series A Bonds will remain payable on June 15, 2011, December 15, 2011 and semi- annually thereafter on June 15 and December 15 in each year until maturity (or prior redemption). Such interest will be payable by check drawn by the fiscal agent and mailed to the registered owner on each interest payment date at the address as shown on the registration books of the fiscal agent as of the last business day of the month preceding each such interest payment date. Bonds may be transferred or exchanged at no cost to the registered owner at any time prior to maturity at the office of the fiscal agent for Bonds of the same or any other authorized denomination or denominations in the same aggregate principal amount in accordance with the Local Finance Law. The fiscal agent shall not be obligated to make any such transfer or exchange of Bonds between the last business day of the month preceding an interest payment date and such interest payment date.

Purposes of Issue

The Bonds are being issued pursuant to the Constitution and statutes of the State of New York, including among others, the County Charter and the Local Finance Law, for the following purposes and amounts:

Parks – 15 years $ 2,285,000 Parks - 20 years 2,905,000 Van Duyn - 10 years 2,481,796 Van Duyn - 5 years 780,548 War Memorial/Oncenter 1,092,615 War Memorial/Oncenter (Roof) 1,739,200 Radio Equipment 800,000 Radio Infrastructure 1,000,000 OCC - Indoor Sports Arena 2,000,000 OCC - Building Const. & Reconst. 4,647,841 OCC - Ferrante & Gordon Halls 750,000 Highways 2004 600,000 Highways 2006 105,767 Bridges 2007 400,000 Highways 2007 1,094,233 Highways 2008 700,000 DOT Facilities Environ Improv 400,000 Bridges 2008 1,000,000 Highways 2009 9,103,000 Bridges 2009 200,000 Highways 2010 6,000,000 Mitigation Clinton 3,600,000 Mitigation Harbor Brook 3,340,000 Mitigation Midland 1,000,000 Green Improv Fund from Harbor Brook 1,250,000 Green Improv Fund from Midland 1,000,000 Green Improv Fund from Clinton 1,850,000 Trunk Sewers 1,500,000 Total: $53,625,000

The proceeds of the Bonds will provide new monies for the aforementioned purposes.

8

THE COUNTY

GENERAL INFORMATION

The County of Onondaga is located in the central New York region, has a land area of 780.3 square miles and is approximately 35 miles in length and 30 miles in width. The County is governed under a home rule charter, which provides for the separation of the executive and legislative functions. This charter was approved by voter referendum in 1961. The 2000 U.S. Census showed a population of 458,336 for Onondaga County, which included a population of 147,306 for the City of Syracuse. The U.S. Census showed an estimated 2009 population of 454,753, which included a population of 140,658 for the City of Syracuse. The City of Syracuse is situated in the approximate center of the County and serves as the focus for commercial and business activities.

Pursuant to New York State Law, the County is responsible for the local funding of mandated social service programs, such as Medicaid. The County also administers health care services and operates the Van Duyn Home and Hospital, a long- term care facility. The County, in conjunction with its underlying units, is responsible for providing police, fire, sanitation and water services, as well as the maintenance of streets, parks and recreational facilities.

Governmental Organization

Onondaga County was established in 1794 and is comprised of separate municipalities, which include the City of Syracuse, 19 towns and 15 villages. The Onondaga Indian Reservation is also located in the County. In 1962, a County Charter became effective which divided the County into 24 legislative districts with an elected legislator representing each district in the County Legislature. Under the County Charter, a county executive was established to administer county government. The County Executive is the Chief Executive Officer and Chief Budget Officer of County government. The County Comptroller has responsibility for accounting and auditing of receipts and disbursements and is the Chief Accounting Officer. The County Executive and County Comptroller are elected to four-year terms and their current terms began in 2008. The County Clerk, Sheriff, and District Attorney are constitutional officials and are also elected to four-year terms. By Local Law No. 9 of 1995, the County merged the Division of Management and Budget into the Department of Finance, to be administered by the position of Chief Fiscal Officer. The Chief Fiscal Officer, who is appointed by and serves at the pleasure of the County Executive, is responsible for collection of taxes and other revenues, the custody and disbursement of all public funds of the County, and for the issuance of bonds, bond anticipation notes, and other financial offerings as provided for in the State Local Finance Law

Pursuant to Local Law No. 11 of 1996, twenty-four legislative districts were reduced to nineteen districts effective January 1, 2002.

Transportation

Approximately 60 million people live within a 350-mile radius of Onondaga County. This radius includes the populations of Boston, New York City, Philadelphia, Baltimore, Pittsburgh, Toronto and Montreal. The County’s central location is enhanced by its excellent transportation infrastructure and systems.

Air

Air passenger service is provided by six major airlines and twelve commuter airlines, offering approximately 125 daily arrivals and departures. The County is also served by four major air cargo carriers. Total passengers for 2009 (enplaned and deplaned) were 2,054,187, an 8% decrease as compared to 2008. Air Canada began flying from Syracuse to Toronto in May 2010.

Rail

Onondaga County is served by the railroad facilities of CSX (formerly Conrail) and Amtrak, which maintain terminals within the County. CSX’s computerized rail yard has the capacity to handle 2,200 cars per day, while Amtrak Rail serves Central New York travelers with daily departures from the newly constructed inter-modal transportation center. See “Bus” herein.

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Water

Water transportation is provided by the New York State Canal Corporation, a subsidiary of the New York State Thruway Authority. The system, which was recently designated as a National Heritage Corridor by the U.S. Congress, carries boaters from Syracuse to the St. Lawrence Seaway and the Hudson River and from there to literally anywhere in the world. A major Barge Canal Terminal, located just one mile from downtown Syracuse, is being redeveloped for recreational boating uses by the New York State Thruway Authority, the City and private developers. The region is also served by the Port of Oswego, a deep-water port on Lake Ontario.

Highways

Onondaga County has been appropriately named the “Crossroads of New York State” due to the fact that the State’s two major interstate routes – the east-west New York State Thruway (I-90) and the north-south Interstate 81 intersect just north of the City of Syracuse. The New York State Thruway is accessed by six interchanges within the County. Interstate 690 forms an east-west axis through the County and Interstate 481 links the City of Fulton and surrounding towns. Also, there are more than 2,600 miles of highways, roads, and streets throughout the County.

More than 150 motor carriers including the nation’s top 12 carriers of general freight service the Onondaga County area.

Bus

Bus service is provided by two independent carriers, as well as by CENTRO, which is operated by the Central New York Regional Transportation Authority, and provides a high level of public transportation service to the County. Inter-city service is provided by several bus lines including Greyhound and Trailways. Two bus services with favorable rates within New York State and to Toronto began operations in 2008 – Megabus and Neon Bus (a division of Greyhound). CENTRO operates a newly constructed inter-modal transportation center adjacent to the regional market and in close proximity to Alliance Bank Stadium and the Carousel Center. The center provides mass transit lineage for rail and bus service.

Higher Education

Onondaga County is a center for higher learning, with approximately 33,150 students currently attending colleges within the County. The Central New York region houses the third largest concentration of colleges and universities in the nation. Syracuse University (“SU”) is a highly regarded private college, offering a diverse portfolio of undergraduate and graduate degrees to its approximately 18,000 full and part-time students. Syracuse University’s Maxwell School of Citizenship and Public Affairs and Newhouse School of Communications are recognized as leaders in the field of public administration and journalism, respectively.

Also located within Onondaga County are LeMoyne College, a Jesuit-run liberal arts college; the State University of New York’s Upstate Medical University, the largest medical school in upstate New York; and the SUNY College of Environmental Science and Forestry. In addition, more than 12,000 students attend Onondaga Community College (“OCC”), a two-year college that is part of the State University of New York system.

Over 90% of Onondaga County’s high school graduates go on to attend post-secondary educational institutions (NYS Education Department, October 2006). Nearly 90% of County residents 25 years and over have a high school education or higher, with 29.4% possessing a Bachelor’s Degree or more (2005 U.S. Department of Commerce, Bureau of the Census Current Population Survey), putting the County at or above State and national levels.

Health and Medicine

Six of the County’s largest employers are in the health care sector and four of the five major hospitals have recently completed or are continuing expansion plans in 2010. The area’s largest employer, the Upstate Medical University, a medical school, which includes University Hospital (350 beds), is the home of the regional neurosurgery center and one of the country’s eleven Joslin Centers for Diabetes. It is also the region’s trauma center, burn center, kidney transplant and pediatric emergency center. St. Joseph’s Hospital Health Center (431 beds), Crouse Hospital (576 beds) and Community General Hospital (306 beds) collectively provide a regional neonatal center, a high-risk obstetrics center and a cardiac surgery and cardiology program. In all, the County’s health care system includes the four aforementioned hospitals and the Syracuse Veterans Medical Center, nearly 1,500 practicing physicians, two mental health centers, numerous ambulatory care programs, and a full range of long-term care facilities. Area hospitals operate approximately 1,800 licensed beds. In addition, there are approximately 3,000 beds in fourteen extended care facilities and nursing homes.

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Culture and Recreation

Onondaga County offers a variety of cultural, recreational and entertainment opportunities.

The Syracuse Symphony Orchestra is one of America's busiest regional orchestras serving the entire central and northern New York area, plus concerts from Jamestown to Lake Placid. With a 39-week season and 80 professional musicians on contract, the orchestra offers a variety of classical and popular music concerts, dance programs, family series and educational activities and ensemble performances for all ages.

Syracuse Stage creates innovative, adventurous and entertaining productions, including new plays and bold interpretations of classics and musicals. Founded in 1974, Syracuse Stage has produced more than 220 plays in 36 seasons including a number of world, American, and East Coast premieres. Each season 90,000 patrons enjoy an adventurous mix of new plays and bold interpretations of classics and musicals featuring the finest theatre artists. In addition, Syracuse Stage maintains a vital educational outreach program that annually serves over 30,000 students from 24 countries.

Syracuse Opera enriches the lives of the people of upstate New York through locally produced opera .Offering three main stage productions each season and year-round community performances and education programs, Syracuse Opera reaches over 60,000 people each year.

Syracuse Jazzfest is the Northeast’s largest free jazz festival, attracting up to 80,000 music fans each year. This year’s Festival, the 28th annual, is in its 10th year at Onondaga Community College. Jazzfest features nationally and internationally known jazz artists, including Boz Scaggs and Natalie Cole in 2010.

Alliance Bank Stadium is home of the Syracuse Chiefs - the Triple-A affiliate of the Washington Nationals as of the 2009 season. The Stadium, which opened in 1997, has been called one of the finest minor league baseball facilities in the country, combining modern amenities for athletes and fans with an old-fashioned brick facade architecture. Designed by HOK - the architects of Camden Yards in Baltimore, Coors Field in Denver, Jacobs Field in Cleveland and the newly proposed Yankee Stadium in New York – Alliance Bank Stadium was designed to serve as a multi-purpose facility for a variety of area sporting and entertainment events. The stadium seats 11,300 and annual attendance averages 393,900. In fall 2007 a turf field replaced the artificial surface.

The Syracuse Crunch, who recently announced its 2010-11 affiliation with the Anaheim Ducks, brought professional hockey back in Onondaga County since 1994 in the 6,230-seat Onondaga County War Memorial. During the 2009-10 season, attendance averaged 5,294 fans per game.

Syracuse University sports provide upstate New York with nationally-ranked men and women’s collegiate athletics. The 50,000-seat Carrier Dome, America’s only on-campus domed stadium, is the home of Syracuse University football, basketball, track and lacrosse. Its athletic programs are consistently ranked among the top 20 teams in the country and boast recent national championship teams – 2003 Men’s Basketball and 2008 and 2009 Men’s Lacrosse. Its women’s programs are experiencing new NCAA success, especially basketball, field hockey and lacrosse. In addition to Syracuse University sports, the Carrier Dome is the venue for Central New York’s major concert events. The dome hosted the NCAA Men’s Basketball Regional Championships five times since 1997 and will again in 2014. The University also hosts lectures by leading business, political, literary and media dignitaries.

Onondaga County Parks provide recreational, cultural, educational, and environmental opportunities in a 6,500-acre system. The County-owned Rosamond Gifford Zoo at Burnet Park is home to the Penguin Coast exhibit showcasing the Zoo’s colony of Humboldt penguins. This $3.75 million display opened in July 2005. The Zoo’s Asian elephant exhibit and its other signature animals – the Amur tigers, ocelots, golden lion tamarins, and red pandas attract residents and visitors to the in-City zoo. A new conservation and education center, a “Green Building” project, opened in 2002, with a renovated courtyard, and new primate and elephant barn sections coming by 2011.

Onondaga Lake Park was named “one of America’s top ten national heritage parks” after 2003 Parks for Tomorrow renovations added Wegmans boundless playground, the region’s premier skatepark, the Griffin Visitor Center, and various sports courts. Marina renovations and enhancements to the Wegmans Landing section of the park are underway in 2010. Distinguished by seven miles of waterfront trails, this is upstate New York’s most-visited leisure facility. The Skyline Lodge at Highland Forest and visitor center enhancements at Beaver Lake Nature Center were also unveiled in 2003.

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Onondaga County’s lakes have become destinations in the world of fishing, as evidenced by the national acclaim generated by three BASSMaster Elite Series events at Oneida Shores and the 2007 BASS Master Memorial held on Onondaga Lake.

In all, the Onondaga County County Parks system provides the community with a nature center, beaches, forested areas and natural feature parks, a centrally located multi-use park with intensive recreational opportunities, a marina and boat launches, athletic fields and a professional sports stadium, a fish hatchery, dog park, historic facilities and memorial areas, as well as an array of special events and programs which have significant impact upon tourism and quality of life. This is documented by approximately $7.0 million in economic impact generated by fishing (NYS Dept of Environmental Conservation and Syracuse Convention & Visitors Bureau) in 2008. Annual attendance approaches 3.0 million.

Conventions and Tourism

Onondaga County has recognized the economic importance of conventions and tourism as a net wealth generator for the community. The County was the driving force behind the development of the Oncenter Complex, an integrated convention center complex consisting of three venues. Centrally located in downtown Syracuse, it attracts both regional and national events that contribute to the economic and cultural development of Onondaga County. The Nicholas J. Pirro Convention Center is ideal for major conventions, meetings, banquets, consumer and trade shows. The space includes a multi-purpose exhibit hall with 65,000 square feet, the 15,000 square feet grand ballroom and ten meeting rooms and atrium space. There is an enclosed walkway that attaches to a 1,000-space parking garage. Next door, the War Memorial has the versatility to accommodate numerous large-scale events, including ice shows, family shows, car shows, concerts, sports events and conventions. It offers over 91,000 square feet on three levels and can accommodate over 7,000 guests in the arena. New telescopic seating was just installed in the arena along with a new, state-of–the-art digital scoreboard. The John H. Mulroy Civic Center is home to three beautiful, distinct theaters that host a diverse variety of events, from stage productions, and lecture series, to symphonies and business meetings and can accommodate between 20 and 2,100 guests.

The award winning Oncenter Complex has continually been recognized for its outstanding level of customer service, flexibility of function space, quality of food and the hospitality of its staff. They have received the “Inner Circle” award from “Association Meetings” magazine since 1999 and for the last four years been recognized as a “Prime Site” from the Facilities and Destination Meetings Magazine.

The versatility of the Oncenter has led to the annual attraction of over a half million visitors and thousands of room nights to Onondaga County. In 2009 the Complex hosted 24 consumer shows and 18 conventions. Many conventions hold annual events, including the International Healthy Building Conference, the Syracuse Sporthorse Invitational Tournament, the New York State Vegetable Growers Association and the New York State Telecommunication Association.

The Empire Expo Center in Onondaga County is the home of the Great New York State Fair, which attracts nearly 1,000,000 people from across the Northeast during its 12-day run each August. The Fairgrounds attract hundreds of thousands of additional visitors to a wide variety of non-Fair events throughout the year. With more than 100 structures, 21 major buildings and parking for 23,000 cars, the Empire Expo Center can host any imaginable event and the annual economic impact of these events to Central New York is an estimated $120 million.

Population Trends

Year Onondaga County New York State United States 1980 463,920 17,558,072 226,504,825 1990 468,973 17,990,455 249,632,692 2000 458,336 18,976,457 281,421,906 2009 (est.) 454,753 19,541,453 307,006,550

Source: U.S. Census Bureau, State and County Quick Facts and Population Estimates

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Unemployment Rate Statistics

Annual Average Unemployment Rates (%)

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2009 YTD1 2010 YTD1 Onondaga County 3.5 4.0 4.9 5.1 5.1 4.5 4.4 4.1 5.1 7.6 7.5 8.1 New York State 4.5 4.9 6.2 6.4 5.8 5.0 4.6 4.5 5.3 8.4 8.0 9.1 United States 4.0 4.7 5.8 6.0 5.5 5.1 4.6 4.6 5.8 9.3 8.2 9.7

1 Year-to-date (YTD) data is the average of the months January through March.

Source: New York State Department of Labor and the U.S. Bureau of Labor Statistics

Monthly Unemployment Rates (%)

2009 2010 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Onondaga County 7.8 7.6 7.1 7.6 8.0 7.8 7.5 7.8 7.7 7.5 7.6 8.3 8.2 7.9 New York State 8.2 8.2 7.7 8.1 8.6 8.8 8.6 8.7 8.7 8.5 8.8 9.4 9.2 8.8 United States 8.2 8.6 8.9 9.1 9.5 9.4 9.7 9.8 10.0 10.0 10.0 9.7 9.7 9.7

Source: New York State Department of Labor and the U.S. Bureau of Labor Statistics

Labor Market Statistics

The following tables present the distribution of employment in Onondaga County and employment trends for 2000, 2006, 2007 and 2008. Trend of Total Employment Total Employment and Employment as a % of Total Employment 2000, 2006, 2007 and 2008

Percent Percent Percent Percent Industry 2000 of Total 2006 of Total 2007 of Total 2008 of Total

Agriculture/Forestry 578 0.23% 466 0.19% 521 0.21% 550 0.22% Mining 126 0.05%196 0.08% 204 0.08%180 0.07% Utilities N/A N/A 1,469 0.58% 1,506 0.60% Construction 10,272 4.07%10,075 4.06% 10,337 4.11%10,382 4.13% Manufacturing 35,126 13.91%26,474 10.68% 26,446 10.53%25,472 10.14% Wholesale Trade 14,277 5.65% 13,410 5.41% 13,336 5.31% 13,247 5.28% Retail Trade 29,852 11.82% 28,403 11.46% 28,680 11.42% 28,660 11.41% Transportation/Warehousing 8,049 3.19% 8,510 3.43% 9,045 3.60% 9,126 3.63% Information 7,044 2.79%5,307 2.14% 5,171 2.06%4,988 1.99% Finance and Insurance 12,474 4.94% 12,373 4.99% 12,611 5.02% 12,573 5.01% Professional Services 30,164 11.95% 33,737 13.61% 34,615 13.78% 34,581 13.77% Education & Health Services 34,466 13.65% 38,633 15.59% 39,259 15.63% 39,707 15.81% Leisure & Hospitality 18,725 7.42% 20,016 8.08% 20,462 8.15% 20,840 8.30% Other Services/Unclassified 9,498 3.76% 9,055 3.47% 9,007 3.59% 8,703 3.47% Total Government 38,819 15.38% 39,578 15.97% 40,056 15.94% 40,573 16.16% TOTAL 252,477 247,869 251,218 251,087

Note: Column totals may not foot due to rounding. Source: New York State Department of Labor, Quarterly Census of Employment and Wages Survey (QCEW).

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Labor Force Statistics in Onondaga County

Persons in the labor force and persons employed (annual average) in Onondaga County for 2000 through 2010 YTD1 are as follows (in thousands):

Year Labor Force Employment 2000 230.9 222.8 2001 230.9 221.5 2002 231.7 220.3 2003 231.0 219.2 2004 232.2 220.4 2005 234.1 223.4 2006 234.5 224.3 2007 233.5 223.8 2008 236.1 224.0 2009 235.2 217.4

2009 YTD1 234.9 217.2 2010 YTD1 233.0 214.1

1 Year-to-date (YTD) data is the average of the months January through March.

Source: New York State Department of Labor, Local Area Unemployment Statistics Program (LAUS)

Major Employers

Listed below are the major industrial and service-related employers in Onondaga County and the number of employees: Rank Name Employees 1 Upstate Medical University 6,500-7,000 2 Syracuse University 6,500-7,000 3 Wegmans Food Markets 4,000-4,500 4 St. Joseph’s Hospital Health Center 3,000-3,500 5 Crouse Hospital 2,500-3,000 6 Loretto Adult Care Facilities 2,000-2,500 7 Lockheed-Martin MS2 2,000-2,500 8 National Grid 1,500-2,000 9 Raymour & Flanigan Furniture 1,000-1,500 10 V. A. Medical Center 1,000-1,500 11 Carrier Corporation 1,000-1,500 12 Welch Allyn, Inc. 1,000-1,500 13 United Parcel Service 1,000-1,500 14 Verizon 1,000-1,500 15 Community General Hospital 1,000-1,500 16 Roman Catholic Diocese of Syracuse 1,000-1,500 17 Excellus BCBS of CNY 500-1,000 18 L. & J. G. Stickley, Audi & Co. 500-1,000 19 AXA Equitable Life Insurance 500-1,000 20 Syracuse Research (SRC) 500-1,000 21 Time Warner Cable 500-1,000 22 Bank of New York Mellon Corp. 500-1,000 23 Anheuser Busch 500-1,000

Source: Syracuse Chamber of Commerce, March 2010.

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Commercial Banking

There are thirteen major commercial banks with more than 131 branches within the County. The five savings institutions have an additional 9 branches. Offices of the following commercial and savings banks are within the County:

Commercial Banks Savings Institutions Adirondack Bank JP Morgan Chase Bank, N.A. Beacon Federal Alliance Bank, N.A. Key Bank, N.A. Fulton Savings Bank Bank of America, N.A. M & T Bank Geddes Federal Savings & Loan Assn Citizens Bank, N.A. Solvay Bank Oneida Savings Bank Community Bank, N.A. The Lyons National Bank Seneca Federal Savings & Loan Assn First Niagara Bank Wilbur National Bank HSBC Bank, U.S.A.

Source: http://www2.fdic.gov/idasp/main.asp April, 2010

Economic Development

Collaboration is the key to Economic Development in the Onondaga County region. The Syracuse Chamber of Commerce and the Metropolitan Development Corporation combined in May 2010 to form the CenterState Corporation for Economic Opportunity (CEO). Representing not only Onondaga County, the CEO’s 12-county region is home to 1.5 million people and 138,000 college students. The 35 college campuses make it the third highest concentration of colleges and universities in the nation and bring in more than $2 billion in research and development annually. The region is an international leader in green and clean technology, sensor systems and nanotechnology.

CenterState CEO’s emphasis is:  Business Expansion, Retention & Attraction  Innovation & Entrepreneurship  Infrastructure & Urban Initiatives  Workforce & Talent Initiatives  Government Relations & Business Advocacy  Regional Marketing

The County’s Department of Economic Development and the City of Syracuse’s Department of Neighborhood and Business Development are co-locating and collaborating, combining their resources to insure a focused effort to recruit and retain development within the County.

Only 10 of the 337 metropolitan areas in the country added construction jobs between February 2009 and 2010, and the Syracuse metro area is one of them. Syracuse gained 300 construction jobs – a 3% increase. The local construction industry has received a boost from new dormitories and academic buildings at Syracuse University and major expansion projects at the area’s hospitals

Syracuse and Onondaga County are nationally known for green initiatives and have been recognized with the following:

 The County Executive Joanne Mahoney recipient of the 2010 U.S. EPA Environmental Quality Award  Named the #6 Cleantech cluster in the world by Sustainable Work Capital  Syracuse is the winner of the 2007 Go Green Large City of the Year Award  Syracuse was the site of the 2008 Go Green Earth Summit  Syracuse is the nation’s 17th greenest city, according to National Geographic’s Green Guide and Popular Science  Syracuse has won the annual national award from the Alliance to Save Energy  Syracuse is one of MSN.com’s top 12 emerging green cities in the country  Syracuse was selected as the site for the German Federal Ministry of Economics and Technology, supported by the German Energy Agency (dena), ECOFYS Germany and German American Chamber of Commerce international renewable energy conference – 2008 and 2009  Home to 19 green and high-tech development centers, including the Syracuse Center of Excellence in Energy & Environmental Systems, the Clean Tech Center and the Tech Garden  Syracuse University and the Center of Excellence are working on the first Leadership in Energy and Environmental Design (“LEED”) certified neighborhood in the US, and creating new affordable housing opportunities.

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The Green PILOT Credit, a program to encourage private developers to construct buildings that meet the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) standards, was adopted by the Onondaga County Industrial Development Agency. The program reduces a project’s Payment in Lieu of Tax Schedule by a percentage of the cost of construction. The goal is to reduce the upfront cost of going green. The credit increases as the level of LEED certification increases. In some cases, a project may enjoy a “no-tax-period” of up to five years. Onondaga County is one of only a few communities in the nation that offers “green tax credits” to developers.

The area’s institutions of higher learning continue to make significant commitments to off-campus investments and initiatives, particularly within downtown Syracuse, bringing employment, economic activity, and cutting-edge research and development into the community. Current and planned developments by Syracuse University, SUNY’s College of Environmental Science and Forestry (ESF), and the Upstate Medical University, the County’s largest employer, are revitalizing downtown Syracuse along with surrounding neighborhoods and commercial districts.

The New York State Center of Excellence in Energy and Environmental Technologies, a collaborative venture between the State, Syracuse University, SUNY’s College of Environmental Science and Forestry, and private business, opened in March 2010. This $35.6 million, high profile, downtown development will focus academic and corporate research and the development of innovations relating to clean and renewable energy, indoor environmental quality, and water resources. The project is the product of a federation of more than 140 businesses, organizations, and educational and research institutions.

Syracuse’s Center of Excellence is intended to serve as a catalyst for an adjacent $200 million mixed-used development planned to be constructed in phases over the next six years. The 14-acre development, located at the crossroads of Interstates 81 and 690, will include a new Biotechnology Research Center sponsored by Upstate Medical University and the SUNY College of Environmental Science and Forestry. A key component of the Center will be its core facilities for DNA, proteomic, bioinformatics and tissue engineering technologies - processes that capitalize on new genomic discoveries and fuel the expansion of the biotechnology industry. SUNY has announced alliances with the region’s largest biotechnical firms, including Bristol-Myers Squibb, Pall Life Science, Corning, and Albany Molecular to conduct joint research and development at the facility. The proposed mixed-use project also includes approximately 500,000 square feet of privately developed--and taxable--office, retail and residential space.

Groundbreaking ceremonies were held in July 2009 on the $20 million first-phase of the Central New York Biotechnology and Research Center. Part of a five year, $510 million capital plan advanced by the Upstate Medical University, the plan also includes development of a new Western Campus consisting of major residential, clinical, and research facilities located within the traditional boundaries of downtown Syracuse. Upstate continues to invest in its on- campus facilities. The new Golisano Children’s Hospital, the centerpiece of a $140 million expansion of its University Hospital, opened in September 2009.

As a part of its commitment to strengthen connections with the surrounding community, particularly with downtown Syracuse, Syracuse University converted a former furniture warehouse in downtown Syracuse to house its School of Architecture during the construction of its renovated facilities and a permanent home for its Visual and Performing Arts (VPA) program. The project was a highly visible demonstration of Syracuse University Chancellor Nancy Cantor’s plan to establish a sustained presence in downtown Syracuse. The University announced plans to acquire and renovate several major abandoned industrial and warehouse buildings on the western edge of downtown to create a Syracuse Arts, Technology and Design Quarter—a community of residences and workspaces for artists, designers, technologists, and innovators. WCNY, the region’s public radio and television broadcaster, is working on financing to build a new 75,000 square foot broadcast and education center in the revitalization area.

The Syracuse University campus is also undergoing substantial development, with the completion of the new 160,000 square foot Whitman School of Management, the 74,000 square foot expansion of the Newhouse School of Journalism, and a new 230,000 square foot Life Sciences (biology and chemistry) building which opened in Fall 2008. The first new resident hall in 40 years opened in fall 2009. Private investors have constructed two housing complexes housing 650 upperclassmen at the University’s South Campus. Planning continues on a new student welcoming center and bookstore.

The University Hill area, which is home to Syracuse University, SUNY ESF, Upstate Medical University, and a concentration of the region’s health care and hospital facilities is separated from the traditional downtown only by an elevated section of Interstate 81. New York State has committed $20 million in State support to assist with the “Connective Corridor” to better link these two major economic centers. Through lighting, landscaping, signage, and streetscape improvements, the connective corridor is intended to eliminate real and perceived barriers between the two areas, resulting in an improved environment for commercial, residential, and cultural development in downtown Syracuse. The path of the Connective Corridor will also serve as a link between the major arts and cultural centers and tourism destinations within downtown.

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Pending financing, construction is still anticipated on a new 350-room Westin Hotel on the path of the Connective Corridor. This approximately $100 million facility will serve as the headquarters hotel for the County’s award-winning Oncenter convention center complex, generating an estimated $20 million a year in economic activity.

This development is occurring at a time of transition in downtown Syracuse, as older buildings are being converted to market rate rental and owner-occupied housing and several new projects are beginning to emerge from the drawing board. Since 2001, over 200 new units have been added in downtown as the result of adaptive re-use projects. There are currently 195 additional units scheduled for development. In historic Armory Square, there is much activity. In summer 2009, a new $20 million mixed use commercial and residential development opened. This was the first new construction, private-sector downtown building since 1992. The Washington Station Building will open in Fall 2010. OBG Engineering, a large environmental engineering firm based in suburban Onondaga County, will be the anchor tenant in this new 200,000 square foot mixed-use building. Renovations on a 51,000 square foot warehouse adjacent to the Armory Square area are complete and now houses the local architect firm King & King. In September 2009, Urban Outfitters announced it will open a store in a reconverted building.. This is a significant retail win for the area and it is anticipated that other stores will follow.

In an October 2009 announcement, Bannon Automotive announced it intends to manufacture its totally electric car, the Reva, in Onondaga County. Specifically, Bannon proposes to convert existing space in the town of Lysander and invest $26.5 million in the plant. Attracting the company to Syracuse was a joint effort led by New York State, which used grants, tax incentives and wage credits and the Federal government, which will provide loans and guarantees of $52 million.

Another new company, Empire Tissue, is awaiting permits to construct a $167 million 168,000 square foot paper manufacturing plant in the western suburbs. Nearby Solvay Paperboard is a great success story for recycling paper to manufacture cardboard.

In the Lakefront Development area, immediately north of downtown Syracuse, the initial 850,000 square foot expansion of the Carousel Center is fully enclosed, beginning the transformation of the Center into Destiny USA—a retail themed destination that is also pioneering new, environmentally-friendly construction techniques and building systems. In November 2009, the NYS appellate division of the state Supreme Court upheld a lower court’s July 2009 decision that Citibank must resume lending for the mall expansion project under its $155 million loan agreement. There is $68.4 million yet to be advanced on the loan.

Several of the area’s largest high tech and knowledge-based industries are reporting significant growth, as described below.

Lockheed Martin Naval Electronics and Surveillance Systems-Radar Systems, a unit of Lockheed Martin Corporation, is leader in the design, development and integration of radar systems, vessel traffic management, simulation and training systems, and other complex electronic systems. The firm employs 2,400 people at its Syracuse headquarters. The company continues to win defense contracts for radar systems built in Syracuse worth tens of millions of dollars.

Anaren, Inc designs, develops, manufactures and sells high-frequency electronic technology, for the wireless communications, satellite communications and consumer and defense electronics markets. A $6.2 million, 54,000 square foot expansion in the Town of DeWitt is completed. During 2008 two specialty-manufacturing companies were acquired, adding to this 43-year local company’s success.

Bitzer Scroll Inc. has invested $20 million to create 300 new jobs in the town of Salina. Bitzer opened its factory in October 2009, occupying 60,000 square feet of space in the former General Motors plant and making scroll compressors used in air conditioning units that cool apartment buildings and supermarkets. They are employing an experienced workforce that includes former Carrier employees.

Sensis Corporation, a privately-held firm, provides sensors, information technology, and simulation and modeling to the world's air navigation service providers, civil aviation authorities, airports, airlines and militaries. The company employs over 600 in the Town of DeWitt, the site of its 80,000 square-foot headquarters building. The company is in the design phase to expand its headquarters and has plans to hire an additional 300 over the next three to five years. In 2009, the company was awarded a number of new contracts for its technologies and services from customers around the world. Sensis projects strong international demand from its aviation and defense customers and continued need for highly skilled employees.

SRC, Inc., formerly Syracuse Research Corporation, is a not-for-profit research and development company with more than 50 years of experience in defense, environment and intelligence. SRC currently employs 735 at its Cicero headquarters. This growth company expanded its complex with an $18 million, 120,000 square foot new administrative facility next to its current building and is expected to outgrow it in 2011. Due to its success in creating a lightweight counter-mortar radar system for the U.S. Army, its growth in manufacturing led to a for-profit SRCTec subsidiary, which provides manufacturing 17

and logistics support for complex electronics systems and employs an additional 200 in its North Syracuse location. SRCTec recently won a $700 million military contract. SRC is currently working with Lockheed Martin to build a radar called EQ-36 at a cost of $12.6 million each and is seeking 100 new hires nationwide to support the company’s growth.

Welch Allyn, an internationally known manufacturer of medical and dental diagnostic instruments continues to serve as an industry leader and major force in the area’s economy. The firm employs 1,150 locally and 2,600 worldwide. The company is building a Silver LEED certified $33 million, 175,000 square foot expansion and renovation to house a world- class headquarters. In April 2010, it acquired Trimline, a manufacturer of a full range of disposable blood pressure cuffs and accessories as well as aneroid gauges and stethoscopes.

While the role and products have changed over the years, employees at the Bristol-Myers Squibb facility in East Syracuse have the same mission as they have had since 1943: to develop and deliver innovative medicines to help people prevail over serious diseases. 600 employees at this biotech campus are responsible for developing and manufacturing the latest biologic medicines.

Anheuser Busch continues to invest in its Lysander facility. The firm employs 750 workers at its plant northwest of Syracuse and expects to continue its operations at full capacity. The company is a wholly-owned subsidiary of Anheuser- Busch InBev, the leading global brewer, and continues to operate under the Anheuser-Busch name and logo. They will be completing a $45 million modernization of the Beer Finishing Area in June 2010. This is the largest capital investment of its 12 US breweries.

Local hospitals in the Syracuse area employ 13,500 and the major hospitals are continually making capital investments. The Institute for Performance is undergoing a $72 million expansion. The partnership between the Syracuse Veterans Medical Center (VA) and SUNY Upstate Medical University for a new $9 million research grant will fund an integrated health care center for veterans with mental disorders, the first of its kind in the United States. At the Veterans Medical Center, a $78 million expansion for a spinal cord injury/disease center will add 20 new positions and is expected to be ready in 2011. Crouse Hospital is enlarging its surgical rooms to house new technology equipment and is updating its operating room suites. Projects total $35 million with a 2011 completion date. New parking facilities were completed at Upstate, the VA, Crouse and St. Joseph’s within the past four years. In the Prospect Hill neighborhood surrounding St. Joseph Hospital, work is underway to construct affordable housing for employees. St. Joseph’s announced in January 2009, $220 million in hospital expansion plans, which is expected to create 600 construction jobs as well as add 200 new full-time health care positions

Central Land LLC opened a $19.2 million, 92,700 square foot integrated and comprehensive regional clinical and education center in conjunction with Update Medical University Bone and Joint Center. Initially it employs 92 and will add 34 additional jobs, paying $50,000 annually.

A major Northeast furniture retailer, Raymour & Flanigan, invested $33 million in a 380,000 square foot expansion of its Town of Clay corporate headquarters and primary distribution center. The company employs 440 workers, approximately 45% more than anticipated when the expansion proposal was approved for Empire Zone financing.

Tessy Plastics Corp, a plastics-parts maker in Elbridge, New York, is set to expand again – its fifth expansion in six years. It announced a $5.0 million, 90,000 square foot addition for production and warehousing to accommodate its new contract with Proctor & Gamble. Tessy employs 629 in its western suburbs facility.

A squadron of unmanned aircraft (drones) is now based at the Air National Guard base in Mattydale, further securing the future of the base and retaining its 1,000 jobs. $5.4 million is being spent to modernize and expand the buildings. Hancock is the national headquarters for training Reaper maintenance personnel from all service branches. Officials plan to train 400 Reaper maintenance personnel per year.

A $63 million security and expansion at Syracuse Hancock International Airport has been approved and is scheduled for completion in 2012. The center portion of the airport would be completely rebuilt and an addition of 147,000 square feet will enable the combination of the two security screening areas into one central checkpoint. The expansion would be paid for by the passenger ticket fee, charged to fund improvements. The design contract was awarded and is underway. The project is expected to create 250 construction jobs in each of the two years for construction.

ICM Controls relocated to its 84,000 square foot corporate headquarters and HVAC controls manufacturing facility at the previously mentioned Hancock Airpark in Cicero. This $8.7 million investment will add 100 jobs, bringing total employment at this electronic controls manufacturer to 300. G. A. Braun, a leader in the design, build, and automation of laundry and textile processes, is the only US-based manufacturer and supplier of processing equipment. The company moved to its 155,000 square foot, $12.9 million new manufacturing and operations facility in the Airpark. The company currently employs 90 and expects to add 40 employees by the end of the third year. 18

Onondaga County government plays an active role in the economic development process. The County’s economic development strategy includes activities and initiatives at the local, regional, national and international levels.

Nationally, the County has played a leadership role in a very aggressive marketing program aimed at familiarizing national site location firms and corporate real estate executives with economic development opportunities in the area. The County’s economic development marketing program is funded by an on-going appropriation each year. In 2010, $150,000 is allocated from the County and the Onondaga County Industrial Development Agency. The program began operation in July 1999 with an emphasis on building relationships with site consultants throughout the United States through personal visits, newsletters and a client-focused web site.

Regionally, the County continues to participate in the 12-county Central Upstate Regional Alliance, which is a partnership of public, academic and no-profit organizations convened by the Metropolitan Development Association (MDA). The partners work collaboratively to address common challenges and advance unique opportunities for the benefit of the entire region.

Locally, the County is participating with the Greater Syracuse Economic Growth Council, a partnership of all of the area’s economic development organizations, to provide rapid, comprehensive responses to retention and recruitment inquiries and team-based support for prospect visits. The group meets monthly to manage prospect response systems, evaluate new marketing concepts and review company-specific expansion and investment proposals. The County has also become much more active in taking steps to improve the human, as well as the physical and financial, infrastructure necessary to improve the area’s ability to retain and recruit businesses. The County has also initiated an Economic Development Leadership Council, composed of the Mayor of Syracuse and the President of the City Council, the County Executive and the Chairman of the County Legislature, the President of CenterState CEO, the Executive Director of the Manufacturers Association of Central New York, and the Chancellor of Syracuse University. The Leadership Council is designed to ensure a coordinated approach to economic development.

The County has made maximum use of available economic development tools. The Onondaga Civic Development Corporation (OCDC), a not-for profit local development Corporation, was established in October 2009. The corporation, which can provide tax-exempt financing for not-for-profit corporations, was formed with the purpose of encouraging the development or retention of industries that provide employment and job related training opportunities in the community. The Corporation’s first project is the expansion of St. Joseph’s Hospital. In October 2009, the Corporation agreed to issue $177 million in tax-exempt bonds for the project. The second financing will be for the SUNY Environmental Science & Forestry dormitory. This $45 million 33,700 square foot project will be LEED gold certified. The OCDC also approved a bond for $25 million for Lemoyne College’s new science building and infrastructure improvements to their existing facilities. The Cultural Resources Trust has issued $165 million bonds for Syracuse University to finance renovations to dorms and facilities and to construct and equip a new green data center.

The County has taken a proactive and project-oriented approach to the management of its six Empire Zones and the package of tax incentives available in the Zone. Between 2002 – 2009, a total of 7,545 new jobs were created, $1.467 billion in new capital was invested in Onondaga County and the numbers of active Empire Zone companies rose to 237. In January 2002, portions of the City and three developable sites in the County were designated a Federal Empowerment Zone. This designation gives access to a substantial set of tax credits, deductions, exclusions and financing tools for businesses that are both located in the zone and hire zone residents.

The County is equally proactive in preparing sites for major developments. Through its Industrial Development Agency, the County recently acquired an additional 83 acres at the Clay Business Park - a large-scale, industrial development site. This brings the total acreage to 333 acres and is marketed as a part of a statewide effort to attract large manufacturing and distribution firms. The site lends itself to a variety of other large-scale industrial developments seeking large, properly zoned, permitted sites with supporting infrastructure in place. As previously referred to, another shovel-ready site is the Hancock Airpark, a 261-acre County-owned property. During 2007-08, $2 million infrastructure improvements were completed in the Airpark development.

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FINANCIAL STRUCTURE

Budgetary Procedures

The County Executive submits an operating budget each year, which, after the public hearing, is adopted by the County Legislature. Expenditures during the fiscal year may only be made pursuant to appropriations from the General Fund and other special purpose funds established by the County.

However, during the fiscal year, the County Legislature, on the recommendation of the County Executive, may, by resolution, make additional appropriations from any unencumbered balances in appropriations, contingency funds or unanticipated revenues, and to a limited extent by the issuance of budget notes.

Budget Monitoring and Fiscal Controls

Budget analysts regularly meet with fiscal officers in line departments to collect data on expenditures, revenues, performance measures and caseload trends and to discuss potential budgetary issues in upcoming months. The indicators in the database are updated at least monthly based on both the information submitted and discussions at these meetings. The data that has been collected is used to produce a number of reports projecting short and long-term budget performance. These reports include:

Appropriation/Revenue Forecasts

Monthly reports on key expenditure and revenue accounts are produced and these reports are the most important component of budget monitoring activities. The County’s Budget Office staff meets monthly to review the status of all of the major revenue and expense items, and trends in the national and local economy that may impact County finances.

Quarterly reports on the status and forecast of key expenditure and revenue accounts, along with a profile of area economic conditions, are developed collaboratively by the County’s Budget Office and departmental fiscal officers and presented to the County Executive and County Legislature. The report is intended to provide decision-makers with the best available information regarding the condition of County finances. This information is the basis for fiscal and programmatic policy decisions during the course of the year, and establishes the financial foundation for the development of the County’s annual operating budget in the early fall.

Five-Year Budget Projection

This document is intended to be an early warning system for budget officials. It is driven from the database of key indicators. This document is designed to permit officials to formulate plans to address major budget issues confronting the County on a timely basis.

Ensuing Year Departmental Budgets

These forecasts are used to project incremental growth of departmental budget accounts during the budget request process.

The County’s Budget Process

Onondaga County has established an in-depth annual budget process, which is an important component of the County’s overall commitment to disciplined financial management. In early June, the County’s Budget Office receives requests for the upcoming fiscal (calendar) year from departments and spends the summer developing and refining revenue and expenditure estimates based on these requests. On or about September 15, the County Executive presents the budget proposal to the County Legislature. The Legislature’s Ways and Means Committee then undertakes a two to three week review process dominated by budget hearings in which each department presents and defends the agency’s budget request. This review of departmental budget requests by the Legislature is designed to result in financial accountability and attentiveness by every County department, and a legislative body familiar with the details of County finances and programs.

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Special Reports

The major revenue and expenditure indicators serve as an important database for many special reports on key issues facing the County.

Payroll Projection Report

This monthly salary and wage cost projection report forecasts payroll, the largest expenditures in the County budget.

County Budget

The County Executive presented the 2010 budget in September 2009. With the economy continuing in a severe recessionary state with high unemployment, lower retail sales and reduced interest rates, the formulation of the 2010 budget was affected. The primary impact of the State’s 2009-10 budget on the County’s 2010 budget was a decrease of $11.6 million State aid, primarily affecting the County’s Van Duyn Nursing Home. The Federal stimulus bill (ARRA) provided relief of approximately $13.7 million in the form of increased Federal Medicaid (FMAP). The 2010 County budget included a reduction of 252 funded positions – including 138 layoffs, increased property tax levy, institution of a motor vehicle fee, a 911 surcharge increase expected to bring in $1.7 million/year, and other measures to compensate for the deteriorating economic conditions affecting the budget.

The County Legislature adopted the 2010 Budget as amended on October 13, 2009. The 2010 Budget supports $1,164,387,143 in total expenditures, including internal transfers of $199,448,976. Expenses were 2.3% below the 2009 budget as modified. The General Fund budget included an adopted property tax levy of $183,997,042, an increase of 4,175,656, or +2.3% vs. 2009. The 2010 budget applied $7.9 million of General Fund reserves. After adjusting for the appropriation of the $7.9 million in fund balance, the unreserved General Fund balance would be reduced to $59.9 million, or 10.0% of (2008) General Fund revenue.

In 2006, the New York State Comptroller required that county sales tax revenue allocated to municipal governments and school districts within the County must be budgeted as a revenue and expense. Formerly, the allocation of the non-county share of the sales tax was an off-budget transaction in most of New York State’s counties. Since this accounting change artificially inflates General Fund revenues, the goal was restated to subtract this amount, which is estimated at $149.8 million for 2010.

Investment Policy

Pursuant to Article IV of the Onondaga County Charter, the Chief Fiscal Officer is the custodian of all County funds and is charged with the responsibility for creating and administering an investment policy, which is consistent with the Investment Policies and Procedures guidelines promulgated by the Office of the State Comptroller.

Pursuant to the Chief Fiscal Officer’s investment policy, investments of monies not required for immediate expenditure may be made in certain obligations authorized by Section 11 of the General Municipal Law of the State: a) Special time deposit accounts; b) Certificates of deposit; c) Obligations of the United States of America or obligations guaranteed by agencies of the United States of America where the payment of principal and interest are guaranteed by the United States of America; d) Obligations of the State of New York; and e) Subject to approval of the State Comptroller, tax or revenue anticipation notes of any municipality, school district or district corporation of the State, other than Onondaga County.

The Chief Fiscal Officer’s investment policy further provides that, in accordance with the provisions of Section 10 of the General Municipal Law of the State, all deposits, including certificates of deposit and special time deposits, in excess of the amount insured under the provisions of the Federal Deposit Insurance Act shall be secured by a pledge of “eligible securities” with an aggregate “market value” equal to the aggregate amount of such deposits. Eligible securities used for collateralizing deposits shall be held by a third party bank or trust company subject to security and custodial agreements. A November 2008 audit by the County’s Comptroller confirmed the full collateralization of the County’s cash and investments.

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The Chief Fiscal Officer’s investment policy also authorizes the County to enter into repurchase agreements, subject to the following restrictions: a) all repurchase agreements must be entered into subject to a master repurchase agreement; b) obligations shall be limited to obligations of the United States of America and obligations of agencies of the United States of America; and c) the custodian shall be a party other than the trading partner.

As of March 31, 2010, the County’s portfolio consists of money market deposits, certificates of deposit, and U.S. government agency bonds, which range in maturity from one day to four years. The Chief Fiscal Officer’s investment policy does not permit the County to invest in derivatives or reverse repurchase agreements and the County has never invested in derivatives or reverse repurchase agreements.

State Aid

In 2010, budgeted State Aid represents approximately 14.9% of the County’s General Fund revenues. Nearly all of the State Aid received by the County is formula-based assistance for specific mandated human service programs.

The New York State Budget for the fiscal year ending March 31, 2010 was enacted on April 14, 2009. The enacted budget allows for the continuation of the Medicaid Cap that limits local Medicaid payments to the 2005 calendar year level, beginning January 1, 2006, as adjusted by a growth rate of 3.5 percent in 2006, 3.25 percent in 2007 and 3 percent in 2008 and thereafter. The State’s 2009-10 budget reflected a cut of 4% in formula-based and block grant state assistance affecting a range of human service programs administered by the County. This cut negatively affected 2009 County budgeted general fund revenues by approximately $3.6 million and 2010 by an estimated $5.6 million.

Conservative estimates for State revenues were included in the County’s 2010 budget. A basic tenet of County fiscal policy is to respond appropriately and immediately to State Budget actions or other changes that threaten a balanced budget. To enforce this policy, the County has consistently frozen funds in amounts necessary to offset aid reductions proposed in the Governor’s Budget each January and other adverse circumstances as they arise. Because the State is not constitutionally obligated to provide or maintain aid to the County, reserving funds pending passage of the State budget will continue to be standard County policy and practice.

Employees

The County provides services through the employment of approximately 4,079 full time employees, excluding those employed at Onondaga Community College. The County’s workforce is down over 352 employees from January 2002. A 2002 incentive program resulted in 253 early retirements. There are approximately 377 Management/Confidential employees. The following table sets forth the number of employees and the labor organizations through which most employees are represented or affiliated.

Labor Organization Number of Employees Contract Expiration Civil Service Employees Association (CSEA) 3,095 12/31/12 Onondaga County Sheriff’s Police Association (OCSPA) 228 12/31/11 Deputy Sheriff’s Benevolent Association (DSBA) 301 12/31/08 (1) NYS Nurses Association 121 12/31/12 International Union of Operating Engineers 38 12/31/12 Central and Northern New York Building Trades Council 19 12/31/12 Onondaga Sheriffs Captains Association (OSCA) 7 12/31/11

(1) Currently under negotiations.

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Pension Payments

Substantially all employees of the County are members of the New York State and Local Employees’ Retirement System (“ERS”). The ERS is generally known as the “Common Retirement Fund”. The Retirement System is a cost-sharing multiple public employer retirement system. The obligation of employers and employees to contribute, and the benefits to employees, are governed by the New York State Retirement System and Social Security Law (the “Retirement System Law”). The Retirement System offers several plans and benefits which are related to years of service and final average salary, vesting of retirement benefits, death and disability benefits and optional methods of benefit payments. All benefits generally vest after five years of credited service. The Retirement System Law generally provides that all participating employers in the retirement system are jointly and severally liable for any unfunded amounts. Such amounts are collected through annual billings to all participating employers. Generally, all employees, except certain part-time employees, participate in the Retirement System. The Retirement System is non-contributory with respect to members hired prior to July 27, 1976. All members hired on or after July 27, 1976 must contribute 3% of gross annual salary towards the cost of retirement programs during their first ten years of service.

On December 10, 2009, Governor Patterson signed the new Tier V into law. The law is effective for new ERS and TRS hires beginning on January 1, 2010. New ERS employees will not become fully vested until after ten years of service and will now contribute 3.5 percent. There is no provision for these contributions to cease after a certain period of service. Overtime in excess of $15,000 will not be subject to ERS either in contribution from the County or the employee.

The County’s December 15 contributions to the ERS for the years 2000 through 2010 are shown in the table below (includes Onondaga Community College):

Amount Percentage of Year Contributed to ERS Pension Eligible Salaries 2000 $ 780,034 0.08% 2001 1,379,950 0.60% 2002 2,533,209 1.01% 2003 (1) 16,315,583 4.57% 2004 (2) 24,161,264 13.02% 2005 20,617,865 11.10% 2006 19,624,050 10.42% 2007 20,187,445 10.10% 2008 16,405,925 8.20% 2009 17,026,672 7.93% 2010 (Budget) 24,666,242 12.20%

(1) Includes a one-time early retirement incentive payment of $7,539,850. (2) The County elected to amortize the 2004 local cost exceeding 7% of payroll over five years in the amount of $6 million and a taxable general obligation bond issue in this amount was sold in December 2004, which was retired in October 2009.

Historically there has been a State mandate requiring full (100%) funding of the annual actuarially required local governmental contribution out of current budgetary appropriations. With the strong performance of the Retirement System in the 1990s, the locally required annual contribution declined to zero. However, with the subsequent decline in the equity markets, the pension system became underfunded. As a result, required contributions increased substantially to 15% to 20% of payroll for the employees’ and the police and fire retirement systems, respectively. Wide swings in the contribution rate resulted in budgetary planning problems for many participating local governments.

Chapter 49 of the Laws of 2003 amended the Retirement and Social Security Law and the Local Finance Law. The amendments empowered the State Comptroller to implement a comprehensive structural reform program for the ERS. The reform program established a minimum contribution for any local governmental employer equal to 4.5% of pensionable salaries for bills which were due December 15, 2003 and for all fiscal years thereafter, as a minimum annual contribution where the actual rate would otherwise be 4.5% or less due to the investment performance of the fund. In addition, the reform program instituted a billing system to match the budget cycle of municipalities and school districts that will advise such employers over one year in advance concerning the actual pension contribution rates for the next annual billing cycle. Under the previous method, the requisite ERS and PFRS contributions for a fiscal year could not be determined until after the local budget adoption process was complete. Under the new system, a contribution for a given fiscal year will be based on the valuation of the pension fund on the prior April 1 of the calendar year preceding the contribution due date instead of the

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following April 1 in the year of contribution so that the exact amount may now be included in a budget. The 2008 turmoil in the financial markets and the decline in the pension fund’s value has required increased County contributions in 2010.

The investment of monies, and assumptions underlying same, of the Retirement Systems covering the County’s employees is not subject to the direction of the County. Thus, it is not possible to predict, control or prepare for future unfunded accrued actuarial liabilities of the Retirement Systems (“UAALs”). The UAAL is the difference between total actuarially accrued liabilities and actuarially calculated assets available for the payment of such benefits. The UAAL is based on assumptions as to retirement age, mortality, projected salary increases attributed to inflation, across-the-board raises and merit raises, increases in retirement benefits, cost-of-living adjustments, valuation of current assets, investment return and other matters. Such UAALs could be substantial in the future, requiring significantly increased contributions from the County potentially affecting other budgetary matters. Concerned investors should contact the Retirement Systems administrative staff for further information on the latest actuarial valuations of the Retirement Systems.

GASB 45 and Other Post-employment Benefits (OPEB)

The County provides post-retirement healthcare benefits to various categories of former employees. Those benefits are funded on a pay-as-you-go basis. Under the requirements of the Governmental Accounting Standards Board (GASB) Statement No. 45 (GASB 45), all governmental entities are required to report the estimated cost of the accrued liability for such post-retirement healthcare costs. Governments, including Onondaga County with budgeted revenues in excess of $100 million, began reporting that liability in its 2007 year-end statements.

GASB 45 will require governments to account for OPEB liabilities much like they already account for pension liabilities, generally adopting the actuarial methodologies used for pensions, with adjustments for the different characteristics of OPEB. Unlike GASB 27, which covers accounting for pensions, GASB 45 does not require governments to report a net OPEB obligation initially.

Under GASB 45, based on actuarial valuation, an annual required contribution (ARC) will be determined for each municipality. The ARC is the sum of (a) the normal cost for the year (the present value of future benefits being earned by current employees) plus (b) amortization of the unfunded accrued liability (benefits already earned by current and former employees but not yet provided for), using an amortization period of not more than 30 years. If a municipality contributes an amount less than the ARC, a net OPEB obligation will result, which is required to be recorded as a liability on its financial statements.

GASB 45 does not require that the unfunded liability actually be amortized nor that it be advance funded, only that the municipality account for its unfunded accrued liability and compliance in meeting its ARC. The County contracted with AON to perform the OPEB study and actuarial calculation; it was updated in 2008. The County’s total actuarial accrued liability as reported in the 2009 audited financial report was determined to be $700,900,000. The County’s ARC is $54,961,200.

Actuarial valuation will be required every two years since the County’s OPEB plan has more than 200 members.

Other Information

The statutory authority for the power to spend money for the objects or purposes, or to accomplish the objects or purposes for which the Bonds are to be issued, is the County Charter and the Local Finance Law.

The County is in compliance with the procedure for the validation of the Bonds provided in Title 6 of Article 2 of the Local Finance Law.

No principal or interest upon any obligation of the County has ever been past due.

The fiscal year of the County is the calendar year.

This Official Statement does not include the financial data of any political subdivision having power to levy taxes within the County.

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Data Security

Onondaga County has had systems in place for several years to ensure the continuity of governmental operations and security of critical information in the event of a disaster or major emergency. Mainframe data for core governmental systems is backed up daily and disaster tapes are stored offsite weekly per contract with Iron Mountain. A contract is in place with Sunguard for disaster recovery at their New Jersey hotsite. Recovery testing is performed tri-annually to ensure uninterrupted access to business critical information systems. Open systems servers and data are backed-up; the backups are stored on site. In the event of a disaster, servers would be rebuilt and data would be restored manually from tape backups.

Financial Statements

The County’s financial statements are reported in conformance with generally accepted accounting principals and requirements as dictated by The Governmental Accounting Standards Board. GASB promulgates accounting principles and guidelines for financial reporting for use by State and local governments throughout the United States.

The County retains an independent certified public accounting firm for a continuous independent audit of all financial transactions of the County. The last such audit covers the fiscal year ending December 31, 2009 and is attached hereto as APPENDIX D to this Official Statement.

Accounting Practices

The County’s fiscal year is a calendar year, from January l through December 31. The County uses the modified accrual basis of accounting for all funds except the internal service fund. Revenues are recorded when they become susceptible to accrual, meaning they are both measurable and available. Revenues not considered available are recorded as deferred revenues. Expenditures are recorded when a liability is incurred if it is expected to be paid within the next twelve months, except interest on general long-term obligations which is recorded when due. Liabilities expected to be paid after twelve months are considered long-term. Enterprise and internal service funds use the accrual basis of accounting. Under the accrual basis, accounting transactions are recorded when the underlying economic event takes place without regard for when the cash receipt or cash disbursement takes place.

The financial affairs of the County are subject to periodic audit by the State Comptroller and the County Comptroller conducts an annual audit of the County’s finances. Since 1976, the County has retained independent certified public accountants to audit its financial statements. The County engaged an independent certified public accountant to audit the County’s financial statements for 2009 and subsequent years.

Fund Structure

The accounts of the County are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures. The various funds are summarized by type in the financial statements. The following fund types and account groups are used by the County:

General Fund: accounts for all financial resources except those required to be accounted for in another fund. Sources of revenue include: Countywide Real Property Taxes, State and Federal Aid, Sales Tax, User Fees, etc.

Special Revenue Funds: account for revenues from specific taxes or other earmarked revenue sources, which are required by law or regulation to be accounted for in special funds. Grants, County Road Fund, Road Machinery Fund, Water, Water Environment Protection, Van Duyn, Library, and Community Development are included in Special Revenue Funds. The only special revenue fund considered a major fund at this time is the Water Environment Protection Fund.

Debt Service Fund: accounts for resources for payment of principal and interest on short and long-term debt.

Internal Service Fund: accounts for the financing of goods or services, on a cost reimbursement basis, provided by one department or agency to other departments or agencies within the same government or to other governments. The Insurance Fund is an internal service fund.

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Trust and Agency Funds: The Agency Fund is used to account for money and property received and held by the County acting as an agent with only custodial responsibility. An asset and liability are recorded in equal amounts. Private purpose trust funds are used to account for expendable trust funds in which the trust principal and earnings thereon may be expended for the purposes of the trust. Private purpose trust funds are accounted for in essentially the same manner as the governmental funds.

Included in the Combining Statement of Onondaga County are the Component Units: Onondaga Community College, ONCENTER Management Corporation, Housing Development Fund Company, Industrial Development Agency, and Friends of Rosamond Gifford Zoo. OTASC (Onondaga Tobacco Asset Securitization Corporation), established to sell the tobacco bonds, is blended as a Nonmajor Debt Service Fund.

Revenues

General Fund revenues are comprised of locally-derived income and aid provided by New York State and the federal government. According to the County’s 2009 audited financial statements, total revenues grew from $564.3 million in 2004 to $606.2 million in 2009 for a total five-year increase of 7.4%. All revenue numbers after 2005 are reduced by the sales tax accounting change, which totaled $149.3 million for 2009. From 2008 to 2009, revenues decreased $9.0 million, a net decrease of 1.5%. While sales tax receipts and State aid were lower this was offset by Federal ARRA money and $11 million from the sale of tax liens. State and Federal aid comprises 28.4% of the total revenues in 2009, below the 2008 level of 26.6%.

Local Revenue

More than half of the County’s General Fund revenues derive from real property taxes and tax items and sales and use tax. In 2009 these revenues combined to total $309.7 million or 51.1% of the total General Fund revenues of $606.2 million (adjusted by $149.3 million for sales tax accounting change). Between 2004-2009, the county-wide property tax levy went from $171.6 to $179.8 million, an increase over five years of $8.2 million or 4.8%. During the same 5-year period, the County’s share of sales tax revenues grew from $92.3 to $128.5 million, an increase of $36.0 million or 39.2%. However, this was down from $143.1 in 2008. The County’s sales tax rate was increased from 3.0% to 4.0% in September 2004.

Expenditures

Operating Fund expenditures include all General Fund expenditures. Total expenditures increased 6.7% from $564.3 million in 2004 to $602.3 million (adjusted by $149.3 million for sales tax accounting change) in 2009. This was a 1.8% decrease over 2008 levels of $617.0 million.

Fund Balance

In December 1999 the County Legislature adopted a resolution of intent to maintain an unreserved General Fund balance equal to 10% of its General Fund revenues. This goal was reaffirmed in December 2009 with a commitment to restore reserves to 10% within three years, should it fall below. The County ended 2009 with its fund balance at $74.7 million, less pre-paids and encumbrances of $5.3 million, or a net unreserved fund balance of $69.4 million, 11.4% of adjusted General Fund revenues. Since 1999 the County’s unreserved fund balance has exceeded its 10% goal in every year except 2004. In October 2007, as part of the 2008 budget, legislation was passed to permanently adjust the general fund calculation established by the 1999 resolution for the sales tax pass-thru accounting change. See “County Budget”, herein.

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2010-2015 Capital Improvement Plan

In addition to the budget monitoring process for the operating budget, the six-year Capital Improvement Plan (“CIP”) is designed to balance the need for public facilities with the fiscal capacity of the County to provide for these needs. The CIP provides the basis for the development of reliable capital expenditure, debt service and revenue estimates, as well as impacts on future operating budgets.

In conjunction with the County’s land use plan, called the 2010 Development Guide, the CIP serves as a general guide for the planning and construction of major capital projects facilities in the County. The County adopts a six-year capital plan, which sets forth the capital projects – both new and previously authorized, which are anticipated to be either authorized or continued in the ensuing six fiscal years. The County Legislature adopted the 2010-2015 Capital Improvement Plan on October 13, 2009.

The adoption of the capital plan does not constitute an authorization to proceed with a project nor the financing thereof. Each project must be voted on individually by the County Legislature and passed by a two-thirds majority to authorize the issuance of obligations. Accordingly, it is difficult to exactly forecast which projects and the total amount of bonds outlined by the capital plan that may be authorized by the County Legislature during 2010-2015.

The 2010-2015 Capital Plan anticipates expenditures on projects to be authorized. The figures below estimate when the CIP Projects will be funded with County debt (000’s Omitted)

Department 2010 2011 2012 2013 2014 2015 Corrections 0 957 0 0 0 0 Facilities Management 2,000 3,660 12,957 13,330 37,467 20,067 Information Technology 0 2,054 0 0 0 0 Sheriff 0 194 1,887 0 0 0 Library 0 2,250 0 0 0 0 Onondaga Community College 0 4,547 7,066 2,000 1,320 0 Transportation 11,300 31,300 21,000 11,300 11,486 12,300 VanDuyn 7,000 8,238 9,000 9,000 3,000 0 Metropolitan Water Board 0 1,885 0 7,426 7,000 12,000 (1) Water Environmental Protection 10,000 23,000 20,000 26,000 23,000 22,638 Totals 30,300 78,085 71,910 69,056 83,273 67,005

(1) Much of the projected amounts are required for the purpose of the Onondaga Lake Amended Consent Judgment. See “Onondaga Lake” and “Estimate of Obligations” to be issued herein.

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TAX INFORMATION

Municipal Subdivisions in the County

There are 19 towns in Onondaga County as well as the City of Syracuse. Real property is assessed for taxation by local assessors in each town within the County and in the City of Syracuse and is placed on the respective tax rolls. The 2009 assessed and full valuations listed below were used to apportion the 2010 County property tax levy. Of the 20 taxing jurisdictions in Onondaga County, seventeen have adopted a full market value assessment standard, representing approximately 80% of the County’s full market value.

2009 Assessed 2009 NYS Value for 2010 Equalization 2009 Municipalities Percent Full Towns County Tax(1) Rates (%) (2) Full Valuation(3) Value (%) Camillus $ 1,517,241,710 100.00% $ 1,517,241,710 5.79% Cicero 101,148,857 4.90% 2,064,262,388 7.89% Clay 145,249,384 4.36% 3,331,407,890 12.74% Dewitt 2,517,908,435 100.00% 2,517,908,435 9.63% Elbridge 311,065,092 100.00% 311,065,092 1.19% Fabius 101,996,030 91.00% 112,083,549 0.43% Geddes 844,469,957 93.00% 908,032,212 3.47% Lafayette 308,507,184 98.00% 314,803,249 1.20% Lysander 1,465,854,474 100.00% 1,465,854,474 5.61% Manlius 2,375,616,513 100.00% 2,375,616,513 9.09% Marcellus 402,843,288 99.00% 406,912,412 1.56% Onondaga 1,316,790,703 100.00% 1,316,790,703 5.04% Otisco 4,298,058 2.19% 196,258,356 0.75% Pompey 548,556,872 91.00% 602,809,749 2.31% Salina 1,733,808,489 100.00% 1,733,808,489 6.63% Skaneateles 1,278,068,758 100.00% 1,278,068,758 4.89% Spafford 382,286,472 100.00% 382,286,472 1.46% Tully 250,328,852 100.00% 250,328,852 0.96% Van Buren 636,258,596 100.00% 636,258,596 2.43%

Town total $ 16,242,297,724 $ 21,721,797,899 83.07% Syracuse $ 3,740,315,465 84.50% $ 4,426,408,834 16.93%

Grand total $ 19,982,613,189 $ 26,148,206,733 100.00%

(1) Assessed value is the value placed on the property by town or city assessors. (2) As a result of different assessing practices in each municipality, there is a different relationship of assessed value to full value. In order to apportion the County tax levy across jurisdictions, the different assessed values are “equalized” to full value. The 2009 equalization rates and 2009 full valuations used to apportion the 2010 adopted County property tax levy to the municipalities were established by the N.Y.S. Office of Real Property Services (3) Full value represents the true value of a property at some prior point in time. Full value is based on actual field appraisals and surveys conducted by the N.Y.S. Office of Real Property Services, and, from that information, equalization rates were established to convert assessed value to full value.

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Full Value and County Property Tax Levy

The table below sets forth the County assessed and full valuation used for the apportionment of County taxes, the amount of the County tax levy, and the assessed and full value tax rate:

Year of Property Tax Tax Rate Per $1,000 Tax Levy Assessed Value (1) Total Full Value (2) Levy (3) Full Value 2010 $ 19,980,204,538 $ 26,145,123,539 $ 183,997,042 $ 7.04 2009 19,390,307,377 25,599,869,832 179,821,396 7.02 2008 18,771,577,301 24,690,825,684 179,707,960 7.28 2007 17,212,915,514 23,252,773,560 183,847,937 7.91 2006 16,564,405,146 21,412,101,056 182,353,259 8.52 2005 15,965,221,936 20,014,617,713 177,306,231 8.86 2004 15,281,641,452 18,928,895,968 171,572,905 9.06 2003 14,831,297,571 18,298,432,005 158,805,333 8.68 2002 14,330,891,086 17,839,253,316 149,360,200 8.35 2001 13,406,163,815 17,397,879,588 152,708,606 8.78 2000 13,657,105,117 17,134,763,976 157,395,620 9.18 1999 13,432,896,957 17,006,396,537 164,758,608 9.69

(1) Assessed value for the previous year is utilized for purposes of levying County taxes.

(2) Total full value figures are calculated using the taxable assessed full value for County purposes and State Equalization rates. The amount of assessed full value takes into account properties that are partially exempt from County taxation pursuant to Real Property Tax Law, Section 458 (veterans), Section 460 (clergy), Section 464 (volunteer firemen), and Section 467 (aged). This procedure is set forth in Title 2 of Article 8 of the Real Property Tax Law. The New York State Office of Real Property Services assigns an equalization rate for the assessing jurisdictions within the County.

(3) The County tax levy is apportioned using full value figures obtained from the municipality's preceding year assessment roll. For example, the 2010 County tax levy is apportioned using the 2009 total full value figures, which are obtained from the municipality's preceding 2009 assessment roll.

Tax Collection Record County Tax Collection Rates for Towns Unpaid After First Year % Unpaid Unpaid %Unpaid Tax Lien Sale % Unpaid Year County Levy Unpaid (1) Year-end 4/30/10 4/30/10 4/30/10 4/30/10 2010 $ 284,262,783 2009 274,562,462 $ 9,333,523 (2) 3.40% (2) $ 6,823,723 (3) 2.49% $ 942,193 0.34% 2008 268,336,983 8,365,860 3.12% 3,388,559 (3) 1.26% 865,461 0.34% 2007 260,313,637 6,074,852 2.33% 1,113,733 (3) 0.43% 812,608 0.31% 2006 244,920,971 5,337,994 2.18% 776,480 0.32% 776,480 0.32% 2005 235,417,115 5,078,579 2.16% 397,415 0.17% 397,415 0.17% 2004 230,992,385 5,012,694 2.17% 216,692 0.09% 216,692 0.09% 2003 211,549,412 5,090,042 2.41% 142,090 0.07% 142,090 0.07% 2002 192,491,297 5,433,118 2.82% 104,704 0.05% 104,704 0.05% 2001 186,164,938 5,935,394 3.19% 94,166 0.05% 94,166 0.05% 2000 196,556,417 5,423,484 2.76% 143,892 0.07% 143,892 0.07%

(1) Reflects payments made through December in the year following the year of levy. (2) Unpaids including tax liens sold. County-only first year unpaids is $1,889,577 (0.68%). See “Tax Lien Sale” herein. (3) Unpaid for 2007-2009 are grossed up for comparability. See “Tax Lien Sale” herein.

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County Tax Collection Rates for the City of Syracuse (1)

First Year % Unpaid Unpaid %Unpaid Year County Levy Unpaid (2) Year-end 4/30/10 4/30/10 2010 $ 69,062,961 2009 66,934,981 $ 5,064,608 7.57% $ 4,424,565 6.61% 2008 66,311,802 4,404,469 6.64% 3,058,720 4.61% 2007 66,708,506 4,357,763 6.53% 2,255,158 3.38% 2006 66,718,244 4,412,782 6.61% 1,087,500 1.63% 2005 65,443,753 4,426,380 6.76% 770,978 1.18% 2004 66,429,007 4,644,312 6.99% 803,518 1.21% 2003 63,099,943 4,864,376 7.71% 677,179 1.07% 2002 62,455,259 4,951,145 7.93% 439,184 0.70% 2001 64,278,867 5,088,686 7.92% 380,851 0.59% 2000 68,579,022 5,015,607 7.31% 274,068 0.40%

(1) The City of Syracuse allows for quarterly payment of current year taxes. (2) Reflects payments made through December in the year following the year of levy.

Accumulated County Tax Collection Rates for the County and City (1)

Unpaid After First Year % Unpaid Unpaid %Unpaid Tax Lien Sale % Unpaid Year County Levy Unpaid (1) Year-end 4/30/10 4/30/10 4/30/10 4/30/10 2010 $ 353,325,744 2009 341,497,443 $ 14,398,131 (3) 4.22% $ 11,248,288 (4) 3.29% $ 5,366,758 1.57% 2008 334,648,785 12,770,329 3.82% 6,447,279 (4) 1.93% 3,924,181 1.17% 2007 327,022,143 10,432,615 3.19% 3,368,891 (4) 1.03% 3,067,766 0.94% 2006 311,639,215 9,750,776 3.13% 1,863,981 0.60% 1,863,981 0.60% 2005 300,860,868 9,504,959 3.16% 1,168,394 0.39% 1,168,394 0.39% 2004 297,421,392 9,657,006 3.25% 1,020,211 0.34% 1,020,211 0.34% 2003 274,649,355 9,954,418 3.62% 819,269 0.30% 819,269 0.30% 2002 254,946,556 10,384,263 4.07% 543,889 0.21% 543,889 0.21% 2001 250,443,805 11,024,080 4.40% 475,018 0.19% 475,018 0.19% 2000 265,135,439 10,439,091 3.94% 417,961 0.16% 417,961 0.16%

(1) The City of Syracuse allows for quarterly payment of current year taxes. (2) Reflects payments made through December in the year following the year of levy. (3) Unpaids including tax liens sold. The after tax lien sale number is $6,954,185 (2.0%). See “Tax Lien Sale”, herein. (4) Unpaids for 2007-2009 are grossed up for comparability. See “Tax Lien Sale”, herein.

Largest Taxpayers – 2009 Assessment Roll

Name Type Estimated Full Valuations

National Grid Utility $ 751,470,584 Verizon Utility 212,010,037 HUB Properties Trust Real Estate 84,454,575 Shoppingtown Mall LP Commercial 53,621,400 Wegmans Food Markets Retail/Grocery 48,711,100 Bristol Myers Squibb Manufacturing 44,698,600 Great Northern Holdings Retail 39,036,800 Aldi Inc. Retail/Grocery 35,715,000 Carrier Corporation Manufacturing 26,829,100 Nob Hill of Syracuse Apartments Apartments 21,548,994

The ten largest taxpayers listed above have an estimated full valuation of $1,318,096,372, which represents 5.04% of the County’s 2009 full value tax base used for County tax apportionment. 30

Constitutional Tax Margin

In accordance with Section 10 of Article VIII of the State Constitution, the amount which may be raised in the County by taxes on real estate in any fiscal year for County purposes, in addition to providing for the interest on and the principal of all indebtedness, may not exceed an amount equal to 1.5 per centum of the five-year average full valuation of taxable real estate of the County, less certain exclusions as prescribed therein.

Below is a summary of the computation of the Constitutional Tax Margin for 2006 through 2010 which incorporates State adjustments for final equalization rates:

2006 2007 2008 2009 2010 Tax Limit $ 278,269,940 $ 296,635,154 $ 312,340,705 $ 326,466,631 $ 349,755,604 Total Additions/(Exclusions) 21,811,932 20,526,375 23,766,506 24,536,902 17,750,310 Total Taxing Power 300,081,872 317,161,529 336,307,211 351,003,533 367,505,914 Total Tax Levy (1) (subject to limit) 120,983,278 123,419,670 120,867,834 119,306,551 125,452,963 Tax Margin 179,098,594 193,741,859 215,439,377 231,716,982 242,052,951 Tax Margin % 59.68% 61.09% 64.06% 70.98% 69.21%

(1) Total Tax Levy is net of both credits for prior year surplus or deficit sales taxes and the town’s share of sales tax used to reduce the County levy on towns.

Tax Collection Procedure

Real property taxes levied for County purposes are collected and enforced in accordance with the Onondaga County Special Tax Act. County, town, special district and re-levied unpaid village and school district taxes are levied on or about December 24, and are due through January 31 without penalty. All towns within the County, and the City of Syracuse, have the responsibility for collecting County real property taxes during the warrant period (January 1 - March 31).

Each town tax receiver is required to pay the full amount levied for town and town special district purposes to the town supervisor. The balance of collected taxes is remitted to the County's Chief Fiscal Officer. After March 31, uncollected taxes relating to property located outside the City of Syracuse becomes the responsibility of the County's Chief Fiscal Officer. The City of Syracuse retains responsibility for collecting County taxes on property within the City.

After the return of the town tax rolls to the Chief Fiscal Officer on April 1, the following penalties accrue with respect to delinquent taxes: 6% for April; 6.5% for May; 7% for June; 7.5% for July, plus $.25 per line for filing a notice of lien in the office of the Chief Fiscal Officer and $1.00 to discharge any such filed lien; and 8% for August. Delinquent taxes of the current year are advertised once each week for two weeks on or about September 1. Penalty fees for September are 8%, $1.25 filing fee, plus a $60.00 charge added to cover advertising and administrative expenses. On or about October 1, the Chief Fiscal Officer conducts a tax certificate sale. The County of Onondaga purchases most or all of the available Certificates, covering the amount of tax due, plus penalties.

As a matter of general practice, all Certificates are bid for at the tax sale by the Chief Fiscal Officer, acting on behalf of the County. A small portion of the Certificates purchased on behalf of the County are subsequently sold to private individuals. Certificates sold at the annual tax sale may be redeemed at anytime within a three-year period following such sale. Interest at the rate of 12% per annum is added to the face amount of the tax sale certificate.

In 1995, the Onondaga County Legislature passed a local law, which allowed for installment payment of delinquent property taxes that are the responsibility of the County's Chief Fiscal Officer. Provisions in the local law enable a property owner to make a 25% down payment of all delinquent taxes and finance the balance over a two year period with twenty-four equal monthly payments. This legislation followed the County enactment of the partial payment program of current year taxes in 1994. Both programs have met with overwhelming success and have played a significant role in reducing the number of properties included in the annual delinquent tax auction.

The City of Syracuse Commissioner of Finance acts as the collector of County taxes levied on real property located within the City. Prior to January 1, 1978, the City’s Commissioner of Finance remitted to the County’s Commissioner of Finance, now the Chief Fiscal Officer, the entirety of such county tax levy. Since 1978, however, the City’s Commissioner of Finance has been remitting to the County’s Chief Fiscal Officer only the amount of such County tax levy actually collected by 31

the City. The City remains responsible for the enforcement of uncollected tax liens, and periodically, uncollected tax liens of the prior year are sold at tax sale and the proceeds of such sale are remitted to the Chief Fiscal Officer. The County maintains a reserve for uncollected taxes to provide for any deficiency in such remittance.

Title and interest in certain delinquent tax liens on properties in the City of Syracuse were sold to American Tax Funding Servicing LLC in August 2006 and January 2008. The County’s proceeds under these transactions have totaled $4.6 million. American Tax Funding Services purchased the liens previously sold to State of New York Municipal Bond Bank Agency in 2003. None of the delinquent tax liens on properties within the City of Syracuse were sold in the 2010 tax lien sale.

Tax Lien Sale

In January 2010, Onondaga County sold $13,300,000 of the 2007, 2008 and 2009 real property tax liens to a special purpose trust. The County tax liens are evidenced by a tax sale certificate, which bears interest at 12% per year. The trust issued federally taxable certificates of participation with the repayment revenue stream to be derived from the redemption of the tax sale certificates. The certificates of participation mature April 1, 2013. The County agreed with the trustee to repurchase any tax sale certificates, which have not been redeemed at the end of the three-year period.

Payments In-Lieu of Taxes (“PILOTs”)

The County received $2,734,460 and $2,598,197 from payments in lieu of taxes for the fiscal year ending 2008 and 2009 respectively. Budgeted 2010 pilots are $2,935,000. PILOTs are received from various economic development agreements negotiated by the County. Although these properties are not on the tax roll, each property has an assessed valuation determined in the same manner as real property taxes.

Onondaga County Sales Tax –Agreement Expiring December 31, 2010

In September 2004, Onondaga County raised its local sales tax rate to 4% from 3%. New York State law requires a reauthorization of local sales rates in excess of 3% every two years. Onondaga County’s “additional” 1% rate was reauthorized by the State in July 2009 for the period November 1, 2009 - October 31, 2011.

The 4% sales tax, administered by New York State, generated a total of $276.7 million in revenue in 2009, down $17.1 million (-5.8%) from the prior year. Under two separate formulas—one governing the distribution of revenue generated by the initial 3% tax rate and a second governing the use of the additional 1%---the County retained an effective share of approximately 46% of the revenue collected, allocating the balance to municipal governments and school districts within the County. To comply with the sharing agreement, which guaranteed that the 3% revenue to municipalities and schools would not be reduced from the prior year, the County paid out an additional $7.1 million in 2009 to municipalities and schools.

In 2009, local sales tax revenues were allocated as follows (cash basis):

3% Formula 1% Formula Total Dollar Percent Dollar Percent Dollar Percent County $ 78,035,889 37.5% $ 49,945,063 16.5% $ 127,980,952 46.3% City 53,906,470 25.9 7,797,475 25.9 61,703,945 22.3 Towns & Villages 61,850,975 29.7 8,958,509 19.8 70,809,484 25.6 School Districts 14,186,145 6.8 1,999,176 34.2 16,185,321 5.8 Total $ 207,979,479 $ 68,700,223 $ 276,679,702

The formulas used to allocate sales tax revenue are established by local law (3%) and state legislation (additional 1%). The distribution of revenue produced by the 3% tax is anchored to specific base year allocations established for the City, towns and villages (in the aggregate), and school districts (in the aggregate) for the 2001 fiscal year. For the period 2002 through 2010, legislation provides that revenue to the municipalities and schools will not be diminished (unless overall County sales tax collections fall in two consecutive years), and that municipalities and school districts will share in sales tax growth of up to 2% per year. The County retains all annual growth above 2%. This sharing agreement cost the County $7.1 million in 2009.

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Budgeted growth of sales tax collections for 2009 over the 2008 budget was 6.2% - determined as 1.0% baseline growth in sales tax and 5.2% increase as the result of lifting a self-imposed sales tax cap on the retail price of motor fuel. When the 2009 budget was approved, gasoline prices were at all-time highs of $4/gallon. Prices then fell, ranging from $2.00 – 2.80/gallon in 2009. These factors, combined with the recessionary effects of a decline is sales tax revenue, produced a 2009 sales tax revenue budget shortfall of $29.7 million. For the 2010 budget, the County estimated a 6% decline in 2009 sales tax revenue vs. 2008 actual, and then added a 1% baseline growth over the estimated 2009 level or a $129.5 million county share. Through May 2010, on a cash-received basis, the County is experiencing increased revenues vs. 2009 of 7.17%, about even with 2008 levels.

The formula used to allocate the “additional” 1% is based on fixed shares of the revenue. The local legislation governing the allocation of the additional 1% tax calls for the revenue to be distributed as follows: 72.7% to the County, 11.35% to the City, 13.04% to the towns and villages, and 2.91% to school districts. The local legislation that established the distribution formula for the additional 1% is in force through November 2011. When it is up for renewal, the County will ask for that 1% to essentially be allocated to the City.

As a part of the 1% sales tax allocation agreement with the City, and contingent upon State renewals of the 1% sales tax, the County committed to appropriate $3 million a year to the City to support City infrastructure maintenance and improvement programs through 2010. The County, in turn, will share 11% of the development and permit fee income received by the City as a part of the proposed Destiny USA project. Under that agreement, revenue from the Destiny USA project has already begun to be received by the County. The developer of Destiny USA has guaranteed a $60 million IDA fee that will be paid to the Syracuse Industrial Development Agency over a 12-year period, with the County receiving 11% of the amounts paid each year. The $6.6 million front-loaded payment plan provides for payments to the County of $1.2 million in both 2007 and 2008, and $418,000 per year for ten years thereafter.

Onondaga County Sales Tax – New Agreement Effective January 1, 2011 – December 31, 2020

On May 4, 2010, the Onondaga County Legislature unanimously approved a sales tax sharing agreement for the years 2011-2020. This agreement covers the entire 4% local share and acknowledges the “additional” 1% rate must be reauthorized by the New York State Legislature every two years. The agreement essentially gives the City 24.3% of the total, while the County retains 73.6%. Towns receive one -third of their previous allocation in 2011 (or 8.5% of the total), one-tenth in 2012 (or 2.6% of the total), and then are excluded from any future sharing. Schools’ share declines from 5.8% under the old agreement to 2.9% in 2011, 1.4% 2012-2015, and .7% 2016-2020. In a separate, but associated, inter-municipal agreement, the 15 villages within the County will share a fixed $4 million (about 1.4%) of the total receipts. Assuming a 1% annual increase in collections, this new agreement is expected to increase the County’s revenues from sales taxes $66.6 million in 2011 to $193.3 million, an additional $10.5 million in 2012 to $203.8 million, and an extra $7.9 million in 2013 to $211.7 million, with growth in sales tax collections added to this base in proportion to the County’s sharing percentage for 2014- 2020.

The City, towns and villages may elect, by local law, ordinance or resolution to receive their allocated share of sales tax in cash rather than as a credit against the County property tax levy, while school districts are required to receive their allocated share in cash. Currently, one of the nineteen towns takes its total sales tax distribution in cash and five take partial cash payments, while the others take as a credit against the County property tax levy. The City of Syracuse, most villages, and school districts receive their distribution in cash.

For towns that apply the sales tax as a credit against County taxes, the County retains the net sales tax collections and credits the towns with its estimated share. This is done by reducing the County real property taxes to be levied in the town by the amount of the estimated share. If the allocated share would exceed the County taxes, the excess would be used to reduce general town taxes. The estimates used for sales taxes that are used by the towns as a credit are reconciled the following year and an adjustment is applied the succeeding year. The towns will no longer share sales tax after 2012.

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COUNTY INDEBTEDNESS

Constitutional Requirements

The New York State Constitution limits the power of the County (and other municipalities and certain school districts of the State) to issue obligations and to otherwise contract indebtedness. Such constitutional limitations in summary form, and as generally applicable to the County and the Bonds include the following:

Purpose and Pledge

Subject to certain enumerated exceptions, the County shall not give or loan any money or property to or in aid of any individual or private corporation or private undertaking or give or loan its credit to or in aid of any of the foregoing or any public corporation.

The County may contract indebtedness only for a County purpose and shall pledge its faith and credit for the payment of principal of and interest thereon.

Payment and Maturity

Except for certain short-term indebtedness contracted in anticipation of taxes or to be paid within three fiscal year periods, indebtedness shall be paid in annual installments commencing no later than two years after the date such indebtedness shall have been contracted and ending no later than the expiration of the period of probable usefulness of the object or purpose as determined by statutes. Unless substantially level or declining debt service is utilized, no installment may be more than fifty percent in excess of the smallest prior installment. The County is required to provide an annual appropriation for the payment of interest due during the year on its indebtedness and for the amounts required in such year for amortization and redemption of its serial bonds and such required annual installments on its notes.

Debt Limit

Pursuant to Article VIII of the State Constitution and Title 9 of Article 2 of the Local Finance Law, the debt limit of the County is calculated by taking 7% of the latest five-year average of the full valuation of all taxable real property.

The County has the power to contract indebtedness for any County purpose so long as the principal amount thereof, subject to certain limited exceptions, shall not exceed seven per centum of the five year average full valuation of taxable real estate of the County and subject to certain enumerated exclusions and deductions such as water and certain sewer facilities and cash or appropriations for current debt service. The constitutional method for determining full valuation is by taking the assessed valuation of taxable real estate as shown upon the latest completed assessment roll and dividing the same by the equalization rate as determined by the New York State Office of Real Property Services. The New York State Legislature is required to prescribe the manner by which such ratio shall be determined. Average full valuation is determined by taking the sum of the full valuation of the last completed assessment roll and the four preceding assessment rolls and dividing such sum by five.

Statutory Procedure

In general, the New York State Legislature has authorized the power for the County to borrow and incur indebtedness by the enactment of the Local Finance Law subject, of course, to the provisions set forth above. The power to spend money, however, generally derives from other law, including specifically the County Charter and the General Municipal Law.

Pursuant to the Local Finance Law and its Charter, the County authorizes the issuance of bonds by the adoption of a bond resolution approved by at least two-thirds of the members of the County Legislature, the Finance Board of the County. The County Legislature has delegated to the Chief Fiscal Officer of the County the power to authorize and sell bond anticipation notes in anticipation of authorized bonds.

The Local Finance Law also provides that where a bond resolution is published with a statutory form of notice, the validity of the bonds authorized thereby, including bond anticipation notes issued in anticipation of the sale thereof, may be contested only if: 1) Such obligations are authorized for a purpose which the County is not authorized to expend money or, 2) There has not been substantial compliance with the provisions of law which should have been complied with in the authorization of such obligations and an action contesting such validity is commenced within twenty days after the date of such publication or, 3) Such obligations are authorized in violation of the provisions of the Constitution.

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Except on rare occasions, the County complies with this estoppel procedure. It is a procedure that is recommended by Bond Counsel, but it is not an absolute legal requirement.

Each bond resolution usually authorizes the construction, acquisition or installation of the object or purpose to be financed, sets forth the plan of financing and specifies the maximum maturity of the bonds subject to the legal (Constitution, Local Finance Law and case law) restrictions relating to the period of probable usefulness with respect thereto. The County has authorized bonds for a variety of County objects or purposes.

Statutory law in New York permits bond anticipation notes to be renewed each year provided annual principal installments are made in reduction of the total amount of such notes outstanding, commencing no later than two years from the date of the first of such notes and provided that such renewals do not exceed five years beyond the original date of borrowing. (See “Payment and Maturity” under “Indebtedness of the County” herein). In general, the Local Finance Law contains provisions providing the County with power to issue certain other short-term general obligation indebtedness including revenue and tax anticipation notes and budget and capital notes.

Debt Outstanding End of Fiscal Year

2005 2006 2007 2008 2009

Bonds (1) $ 240,989,405 $ 279,282,100 $ 300,599,778 $ 305,523,373 $ 343,500,873 Bond Anticipation Notes (2) 26,152,916 15,000,000 0 6,212,831 8,531,101 Other Debt (3) 140,205 0 0 0 0

Total $ 267,282,526 $ 294,282,101 $ 300,599,778 $ 311,736,204 $ 352,031,974

(1) After defeasance, including tobacco bond defeasances totaling $95,197,600 and $19,919,754 in 2001 and 2005, respectively. (2) Does not include accrued payments from EFC or grants receivable from other sources. (3) Consists of contract indebtedness to the City of Syracuse. Note: Does not include the results of tax lien sale. See “Tax Lien Sale”, herein.

Debt Management

Onondaga County has been proactive in making debt management a priority. In 2000 and 2001, two initiatives were enacted which greatly reduced the County’s calculable debt burden. In December 2000, the County used fund balance in excess of its 10% goal to defease debt of $10.7 million affecting the years 2001-2004. In August 2001, Onondaga County participated in NYCTTII, a pooled sale of revenue bonds by six counties supported by the revenue stream of the Master Settlement Agreement between the States and the major Tobacco Companies. This enabled the defeasance of $95.2 million in Onondaga County general obligation debt and lowered debt service for the years 2002-2021. This resulted in the reduction of the County’s total net indebtedness as a percentage of its constitutional debt limit from 15.16% (April 2001) to 7.2% (August 2001), since these defeased obligations are excluded from outstanding debt calculation. In November 2005, the County participated in a second pooled tobacco bonds sale, NYCTTV. An additional $19.9 million in debt was defeased with these proceeds, lowering debt service for the years 2007-2025.

The County actively monitors its outstanding debt, reviewing candidates for refunding. Taking advantage of the lowest interest-rate environment in forty years, the County refunded $18.5 million of 10-year-old bonds in 2003, saving $1.8 million through 2014. In 2009, a $33,345,000 refunding resulted in savings of $3.3 million over 14 years.

As part of the 2008 budget process, the County amended its 1999 resolution that established the 10% fund balance goal. The calculation for General Fund revenues was formally adjusted to reflect the 2006 NYS accounting change for sales tax passed-through to other municipalities. Since the County ended 2006 with its fund balance at 12.9% of General Fund revenues, the 2008 budget allocated $8 million to fund projects for which the County had not yet borrowed. This provides approximately 15 years of $750,000 annual tax relief.

Certain of the County’s general fund debt service is supported by sources outside of local tax assessments. Emergency 911 Center’s debt - for its recent upgrades - is fully supported by the landline and wireless surcharge revenue. The County petitioned New York State and was granted an increase in its landline surcharge effective December 1, 2009 to enable continued debt service offset for its emergency communications radio equipment. New York State Office of Court Administration subsidizes interest on debt for upgrades to the County courthouse.

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The County’s debt policies were formalized in 2002 and were again ratified by the County Legislature during the 2010 Budget process. The debt management goals are:

2010 2010 Goal Statement Numerical Goal Budget Pro-forma (2) Debt Service/General Funds Revenue (1) 5% 3.1% 3.1% Minimize debt service of County residents Maximum total net indebtedness $500/capita $358/capita $407/capita Full valuation taxable property 1% 0.62% .71% Rapid debt repayment – Retire debt within 10 years 65% 77% 75%

(1) Adjusted revenues to reflect the sales tax accounting change. See “Onondaga County Sales Tax”, herein. (2) Pro forma includes the addition of the new issue to total outstanding debt, adding subsequent year debt service to current levels. First debt service payments: interest – 2011, principal – 2012. Note: Does not include the results of tax lien sale. See “Tax Lien Sale”, herein.

Details of Outstanding Indebtedness

The following table sets forth the short-term and bonded indebtedness of the County as of June 2, 2010 and June 29, 2010 (Pro forma). (Pro forma) Amount Amount Outstanding Outstanding June 2, 2010 June 29, 2010

Short-Term Indebtedness (1) $ 8,864,127 $ 8,864,127

Bonded Indebtedness (2) $ 373,450,373 $ 427,075,373

Total Indebtedness $ 382,314,500 $ 435,939,500

Total Indebtedness after Defeasance $ 336,259,500 $ 389,884,500

(1) Drawdown of EFC grid notes (2) See "Bonded Indebtedness as of June 2, 2010", herein. Note: Does not include the results of tax lien sale. See “Tax Lien Sale”, herein.

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Bonded Indebtedness as of June 2, 2010 Date Interest Amount Bond Issue of Bonds Rate (1) Outstanding • Public Improvement (Serial) Bonds, 1992 ...... 2/15/1992 5.875% $ 3,300,000 (2) • General Improvement (Serial) Bonds, 1992...... 10/1/1992 5.700-5.750% 5,200,000 (2) • General Obligation (Serial) Bonds, 1996 ...... 2/15/1996 5.000% 2,070,000 (2) • NYS Environmental Facilities Corp. Series B Bonds, 1998 (Onondaga County Portion)...... 3/15/1998 5.000-5.200% 2,715,000 (3) • General Obligation (Serial) Bonds, 1998 ...... 5/1/1998 5.000-5.125% 10,350,000 (2*) • General Obligation (Serial) Bonds, 1999 ...... 5/1/1999 4.600-5.000% 3,470,000 (2*) • NYS Environmental Improvement (Serial) Bonds Series 2000A (Onondaga County Portion) ...... 3/9/2000 5.430-5.990% 745,000 (3) • NYS Environmental Facilities Corp. Series 2001A (Onondaga County Portion) ...... 3/8/2001 4.270-5.130% 5,385,000 (3) • General Obligation (Serial) Bonds, 2001 Series A...... 5/15/2001 5.000-5.250% 9,110,000 (2,5) • NYS Environmental Facilities Corp. Series 2001B (Onondaga County Portion)...... 7/26/2001 4.334-5.154% 1,275,000 (3) • NYS Environmental Facilities Corp. Series 2002A (Onondaga County Portion) ...... 3/14/2002 3.932-4.982% 1,255,000 (3) • General Obligation (Serial) Bonds, 2002 Series A...... 5/1/2002 5.00% 9,575,000 (2,5) • NYS Environmental Facilities Corp. Series 2002G (Onondaga County Portion) ...... 7/25/2002 4.043-5.795% 10,745,000 (3) • NYS Environmental Facilities Corp. Series 2002I (Onondaga County Portion)...... 8/7/2002 4.340-4.440% 850,000 (3) • NYS Environmental Facilities Corp. Series 2003A (Onondaga County Portion) ...... 3/13/2003 3.531-4.711% 705,000 (3) • General Obligation (Serial) Bonds, 2003 Series A...... 7/15/2003 3.250-5.000% 19,500,000 • General Obligation (Serial) Bonds, 2003 Series B (Federally Taxable)...... 7/15/2003 4.000-4.350% 400,000 • Public Improvement Refunding (Serial) Bonds, 2003 Series C ...... 7/15/2003 3.750-5.000% 5,670,000 • NYS Environmental Facilities Corp. Series 2003F (Onondaga County Portion)...... 7/24/2003 2.920-4.500% 3,230,000 (3) • NYS Environmental Facilities Corp. Series 2004D (Onondaga County Portion) ...... 7/22/2004 3.381-4.964% 7,530,000 (3) • General Obligation (Serial) Bonds, 2004 Series A...... 8/15/2004 3.500-4.500% 8,250,000 • NYS Environmental Facilities Corp. Series 2005A (Onondaga County Portion) ...... 3/3/2005 3.044-4.399% 12,985,000 (3) • NYS Environmental Facilities Corp. Series 2005B (Onondaga County Portion)...... 7/14/2005 3.069-3.999% 4,330,000 (3) • General Obligation (Serial) Bonds, 2005 Series A...... 8/15/2005 3.750-5.000% 21,200,000 (2) • NYS Environmental Facilities Corp. Series 2006C (Onondaga County Portion)...... 7/13/2006 3.891-4.861% 39,610,000 (3) • General Obligation (Serial) Bonds, 2006 Series A...... 11/14/2006 3.500-5.000% 28,200,000 • NYS Environmental Facilities Corp. Series 2007D (Onondaga County Portion) ...... 9/1/2007 3.810-4.789% 37,390,000 (3) • General Obligation (Serial) Bonds, 2007 Series A...... 12/19/2007 3.750-5.000% 23,950,000 • NYS Environmental Facilities Corp. Series 2008A&B (Onondaga County Portion)...... 6/19/2008 4.270% 1,575,373 (3) • General Obligation (Serial) Bonds, 2009 Series A...... 3/5/2009 3.000-5.000% 61,725,000 • General Obligation Refunding (Serial) Bonds, 2009………………. 12/3/2009 3.000-5.000% 31,155,000

Total Serial Bonds Outstanding as of June 2, 2010 $ 373,450,373 (4)

(1) Interest rate – current through maturity date. (2) Principal outstanding has been partially defeased with the proceeds from Tobacco Revenue Securitization. (See “Debt Management” herein.) (2)* indicates issue refunded in 2009; only defeased amounts remain outstanding. (3) Interest expense is subsidized by the New York State Revolving Loan Fund Program for Clean Water. (4) Of the $373,450,373 of outstanding bonded indebtedness as of June 2, 2010, $46,055,000 is defeased with proceeds from Tobacco Bonds. (5) Issues partially refunded in 2009. Note: Does not include the results of tax lien sale. See “Tax Lien Sale”, herein.

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Estimate of Obligations to be Issued

After this issue, there will be $44 million of general purpose financing that is authorized and unissued. Approximately $26 million of those projects are contemplated for financing in 2011.

The County has obtained and is continuing to pursue low-interest financing from New York State through the Environmental Facilities Corporation (EFC) for various sewer improvements including those relating to the Onondaga Lake Amended Consent Judgment (ACJ). The County has financed $170 million in projects with EFC long-term financing. The EFC’s short-term zero interest loan program is an attractive source of funding that the County takes advantage of. When available, short-term financing is used for up to three years during construction before permanent grant and subsidized loan funding is obtained. There is currently $8.8 million in short-term debt outstanding, with another $59.1 million available to be drawn. Stimulus funds (American Recovery and Reinvestment Act “ARRA” funding) of $20 million are included in the short-term money and are eligible for up to 50% loan forgiveness. Minimal long-term EFC financing is projected in 2011. The amount currently authorized and unissued is $180 million for ACJ purposes. See “2010-2015 Capital Improvement Plan” and "ONONDAGA LAKE" herein. A 2007 change to EFC’s short-term lending policy favors the County and enables zero- interest financing up to 50% of the project cost.

Rate of Principal Retirement

The following table represents the net amounts and percentage of principal of general obligation long-term debt to be retired over the following periods.

Fiscal Years Ending Accumulated Percent Accumulated December 31 Term Total Amount Retired (%) Percentage (%) 2011 – 2015 5 Years $ 69,287,316 46 46 2016 - 2020 10 Years 50,372,000 34 80 2021 – 2025 15 Years 24,570,500 16 96 2026 – 2029 20 Years 5,470,000 4 100

Total $ 149,699,816

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Calculation of Total Net Indebtedness (As of June 2, 2010) The following table sets forth the debt limit of the County and its debt-contracting margin as of June 2, 2010:

5-Year Average Full Valuation of Taxable Real Property ...... $ 23,317,040,265 Debt Limit-7% thereof (1)...... 1,632,192,818

Outstanding Indebtedness: Bonds...... $ 373,450,373 Bond Anticipation Notes ...... 8,864,127 Outstanding Gross Indebtedness ...... $ 382,314,500

Less Exclusions: Appropriations (2)...... $ 2,862,000 Sewer Debt (Bonds) (3) ...... 161,774,666 Sewer Debt (Notes) (3) ...... 8,864,127 Water Debt (Bonds) (4)...... 2,839,000 Defeased Bonds (5) ...... 46,055,000

Total Exclusions...... $ 222,394,793 Total Net Indebtedness (6) ...... $ 159,919,707 Net Debt-Contracting Margin...... $ 1,472,273,112 Percentage of Debt-Contracting Power Exhausted...... 9.8%

(1) The Debt Limit of the County is computed in accordance with the provisions of Article VIII of the State Constitution and Title 9 of Article 2 of the Local Finance Law. (2) Appropriations from adopted 2010 Budget on principal for indebtedness not otherwise excluded. (3) Pursuant to Section 124.10 of the Local Finance Law (4) Pursuant to Section 136.00 of the Local Finance Law. (5) Debt defeased with Tobacco Revenue Bonds in August 2001 and November 2005. (6) The issuance of the Bonds will increase the gross or net indebtedness of the County. There is no constitutional limitation on the amount that may be raised by the County by tax on real estate in any fiscal year to pay interest and principal on all indebtedness. Note: Does not include the results of tax lien sale. See “Tax Lien Sale”, herein.

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Bonded Debt of Political Subdivisions Within The County

The approximate gross bonded debt of political subdivisions within the County is as follows:

City of Syracuse including the City School District (as of August 16, 2009) ...... $ 325,647,185

Other School Districts (as of June 30, 2009)...... 479,302,188 (1)

Towns (as of December 31, 2008) ...... 65,174,551

Villages (as of May 31, 2009) ...... 42,286,633

Fire Districts (as of December 31, 2008) ...... 17,337,193

Gross Total...... $ 929,747,750

The approximate amount of the above gross bonded debt, which is excludable from various debt limitations, is as follows:

State Aid - Support of School Bonds ...... $ 433,458,977 (2)

Town Water & Sewer Bonds...... 13,648,918

Village Water & Sewer Bonds ...... 6,450,506

City of Syracuse ...... 106,167,160 (3)

Total Excludable...... $ 559,725,561

Net Bonded Debt...... $ 370,022,189

(1) Does not include Revenue or Tax Anticipation Notes. Does include $29,320,000 bonds refunded to align debt service with building aid payout schedules and/or issued to realize present value savings. (2) Includes $76,000,000 State Building Aid applicable to Syracuse City School District as well as $29,320,000 bonds refunded to align debt service with building aid payout schedules. (3) Includes self-supporting debt for Airport ($22,788,720) and Debt Reserves comprised of funds received from the sale of Parking Garage Facilities ($6,229,671), Water and Sewer Debt ($44,290,393), Refunded Serial Bonds ($8,015,000), and appropriations not otherwise excluded ($24,843,376).

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Debt Ratios

The following table sets forth certain ratios related to the County’s indebtedness as of June 2, 2010 and pro forma:

As of June 2, 2010 Pro forma at June 29, 2010

Amount of Per % of Full Amount of Per % of Full Indebtedness Capita (1) Valuation (2) Indebtedness Capita (1) Valuation (2) Gross Direct Indebtedness (3) $ 382,314,500 $ 834.14 1.46% $435,939,500 $951.14 1.46%

Net Direct Indebtedness (3) $ 159,919,707 $ 348.91 0.61% $213,544,707 $465.91 0.82%

Gross Direct plus Net Underlying Indebtedness (4) $ 752,336,689 $ 1,641.45 2.88% $805,961,689 $1,758.453.08%

Net Direct plus Net Underlying Indebtedness (4) $ 529,941,896 $ 1,156.23 2.03% $583,566,896 $1,273.232.23%

(1) The County’s 2000 population is 458,336 according to the 2000 U.S. Census. (2) The County’s full valuation of taxable real estate for 2010 is $26,148,206,733. (See “Property Tax Information” herein.) (3) See “Calculation of Total Net Indebtedness as of June 2, 2010” herein. (4) The County’s applicable share of net underlying indebtedness is $370,022,189. (See “Bonded Debt of Political Subdivisions within the County” herein.) Note: Does not include the results of tax lien sale. See “Tax Lien Sale”, herein.

Bonded Debt Service

A schedule of Bonded Debt Service, including principal on the bonds, may be found in APPENDIX B to this Official Statement.

SPECIAL PROVISIONS AFFECTING REMEDIES UPON DEFAULT

Section 3-a of the General Municipal Law provides, subject to exceptions not pertinent, that the rate of interest to be paid by the County upon any judgment or accrued claim against it shall not exceed nine per centum per annum. This provision might be construed to have application to the holders of the Bonds in the event of a default in the payment of the principal of or interest on the Bonds.

In accordance with the general rule with respect to municipalities, judgments against the County may not be enforced by levy and execution against property owned by the County.

The Federal Bankruptcy Code allows public bodies recourse to the protection of a Federal Court for the purpose of adjusting outstanding indebtedness. Section 85.80 of the Local Finance Law contains specific authorization for any municipality in the State to file a petition under any provision of Federal bankruptcy law for the composition or adjustment of municipal indebtedness.

At the Extraordinary Session of the State Legislature held in November, 1975, legislation was enacted which purported to suspend the right to commence or continue an action in any court to collect or enforce certain short-term obligations of The City of New York. The effect of such act was to create a three-year moratorium on actions to enforce the payment of such obligations. On November 19, 1976, the Court of Appeals, the State's highest court, declared such act to be invalid on the ground that it violates the provisions of the State Constitution requiring a pledge by such City of its faith and credit for the payment of such obligations.

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As a result of the Court of Appeals decision, the constitutionality of that portion of Title 6-A of Article 2 of the Local Finance Law enacted at the 1975 Extraordinary Session of the State legislature authorizing any county, city, town or village with respect to which the State has declared a financial emergency to petition the State Supreme Court to stay the enforcement against such municipality of any claim for payment relating to any contract, debt or obligation of the municipality during the emergency period, is subject to doubt. In any event, no such emergency has been declared with respect to the County.

There is in the Constitution of the State, Article VIII, Section 2, the following provision relating to the annual appropriation of monies for the payment of due principal of and interest on indebtedness of every county, city, town, village and school district in the State: “If at any time the respective appropriating authorities shall fail to make such appropriations, a sufficient sum shall be set apart from the first revenues thereafter received and shall be applied to such purposes. The fiscal officer of any county, city, town, village or school district may be required to set aside and apply such revenues as aforesaid at the suit of any holder of obligations issued for any such indebtedness.”

The Constitutional provision providing for first revenue set-asides does not apply to tax anticipation notes, revenue anticipation notes or bond anticipation notes.

MARKET AND RISK FACTORS

The financial condition of the County as well as the market for the Bonds could be affected by a variety of factors, some of which are beyond the County's control. There can be no assurance that adverse events in the State and in other jurisdictions in the country, including, for example, the seeking by a municipality or large taxable property owner of remedies pursuant to the Federal Bankruptcy Code or otherwise, will not occur which might affect the market price of and the market for the Bonds. If a significant default or other financial crisis should occur in the affairs of the State or another jurisdiction, or any of its agencies or political subdivisions thereby further impairing the acceptability of obligations issued by borrowers within the State, both the ability of the County to arrange for additional borrowings, and the market for and market value of outstanding debt obligations, including the Bonds, could be adversely affected.

LITIGATION

The County is subject to a number of lawsuits in the ordinary conduct of its affairs. Other than as may be indicated herein, the County does not believe that these suits or any other existing suits individually, or in the aggregate, will have a material adverse effect on the financial condition of the County.

Self-Insurance

The County has elected to self-insure certain risks of loss, including workers' compensation, all liability risks and certain physical damage risks. The County's self-insurance program also provides certain medical benefits to all active and retired employees, which is administered by a third-party. In addition, to limit self-insurance exposure, the County has purchased an Excess Liability Insurance Policy, subject to certain exclusions, for claims in excess of the County's self-insured retention of $2,000,000. Since 1996, the County has contracted out the administration of its workers' compensation program. The County has established an internal service fund to account for all self-insurance activities, including liability judgments. The fund is supported by annual budget appropriations, which are charged back to the specific departments.

Tax Certiorari Claims

There are a number of tax certiorari proceedings pending involving properties that are subject to the levy of County taxes. The plaintiffs in these matters have asserted that their properties are over-assessed and are seeking assessment reductions. A refund of excess taxes is also generally requested. Tax certiorari claims are administered by the City of Syracuse and by the towns, which assess property in the County. Historically, certiorari claims have been settled through negotiations, resulting in amounts, at times, substantially less than originally claimed. Many settlements provide for future adjustments with no direct outlay of money. The County, however, is responsible for the County portion of any certiorari tax refunds. The County's certiorari claims for 2005 through 2009 were $425,117, $106,883, $196,314, $218,414 and $250,326, respectively. The County has not found it necessary to borrow funds for tax certiorari refunds since budgeted amounts, together with other available funds, have been sufficient to meet such requirements.

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Onondaga Lake

On January 20, 1998, the County entered into an Amended Consent Judgment (“ACJ”) with the New York State Department of Environmental Conservation (“DEC”) and the Atlantic States Legal Foundation (“ASLF”) as settlement of litigation commenced in 1988 which alleged violations of the Clean Water Act in the discharge of wastewater into Onondaga Lake from the Metropolitan Sewage Treatment Plant (“METRO”) and combined sewer overflow (“CSO”) outfalls. The ACJ was filed in the U.S. District Court for the Northern District of New York.

The ACJ required the County to undertake a number of capital projects and related monitoring activities intended to meet the effluent limits specified therein. In September of 2009, the parties presented to the U. S. District Court Judge for the Northern District of New York, a proposed agreement for significant modifications to the ACJ. Said agreement was approved by the Court on November 16, 2009. The modifications, which take the form of amendments to the ACJ, substantively revise the remaining CSO projects and extend the deadline for completion of the CSO projects until December 31, 2018. The amendments to the ACJ also extend the deadline for a determination by New York State on the need for further upgrades at METRO to meet the .02 mg/l Stage III phosphorus effluent limit from February 1, 2009 until December 31, 2011. The deadline for compliance with the Stage III phosphorus limit, if determined necessary, will be extended from December 31, 2012 to December 31, 2015. The respective phosphorus deadlines may be extended by the State by an additional six months if deemed necessary. Under the terms of the ACJ, as amended, in the event that the remaining projects to be carried out are ultimately constructed but do not meet required effluent limits or that municipal wastewater discharges are still contributing to water quality violations, the County would be required to undertake additional measures to achieve compliance.

The amendments have been endorsed by the United States Environmental Protection Agency (“EPA”) and the Department of Justice (“DOJ”). The Onondaga Nation and a number of community groups that had opposed implementation of the remaining ACJ CSO projects have expressed strong support for the amendments. The amendments replace the current CSO program with a combination of gray and green infrastructure programs to be implemented in phases over the next nine years, ultimately requiring 95% system wide annual average waste water volume capture by more environmentally beneficial methods commonly referred to as “gray” and “green” projects.

Additionally, the judicially approved agreement requires the County to develop a floatable control plan for remaining CSOs and facility plans for five specific CSO areas and to submit the plans to DEC within one year of entry of the stipulation order. The County must also submit yearly plans for green projects for approval by DEC as specified in the agreement.

As a result of data collected by the Department of Water Environment Protection (“DWEP“) through the ACJ-mandated Ambient Monitoring Program for 2007 and 2008, the County continues to evaluate the possibility of attainment of the ACJ effluent goals without implementing further upgrades at METRO or diverting the METRO effluent to the Seneca River.

In order to make certain that any decision made regarding final phosphorus effluent limits at METRO is based on the most current available scientific and technical information, the County has agreed to undertake additional studies and evaluations regarding the technological feasibility and cost of further phosphorus removal from the METRO waste water outflow.

In today’s dollars, the estimated cost of the improvements and studies that were to be undertaken pursuant to the 1998 ACJ and the 2006 Amendments thereto, would have been $635 million, excluding interest expenses and the cost of any possible upgrades that might eventually be required to meet the currently mandated Stage III phosphorus limit at METRO, or to divert all or a portion of the effluent from METRO to the Seneca River. Estimates of the impact upon compliance costs of the 2009 amendments to the ACJ remain preliminary.

The State has appropriated $74.9 million of the Clean Water/Clean Air Environmental Bond Act funds for projects covered under the ACJ. In addition to aid through the Environmental Bond Act, based on pledges by State officials, the County also anticipates receiving approximately $85 million in supplemental funding over the fifteen-year life of the project. To date, of the $85 million in pledged funding, $50 million has been appropriated from other New York State sources, an additional $10 million is being processed through the 2007-08 budget, and another $10 million in each of the State’s 2008-09 and 2009-10 budgets. The federal government has already appropriated $120.1 million in federal funds (inclusive of assistance from the U.S. Army Corps of Engineers). Short-term funding of $20 million for the Harbor Brook Project is extended under the ARRA program and this project is eligible for up to 50% loan forgiveness. To date, the County has closed on $98 million EFC long-term loans to fund Lake projects. The eventual repayment of said loans is anticipated from local funds. In addition, the County has received $11.6 million in funds from the City and the Niagara Mohawk Power Corporation, (now National Grid).

The County has included $236 million in local funding for the gross capital costs associated with the ACJ in its 2010- 2015 Capital Improvement Plan. The County has earmarked $38.2 million of its Water Environment Protection fund balance for principal and interest costs to cover the County’s local share of future debt costs not recoverable through State and federal 43

grants and associated with the ACJ project. As of December 31, 2009, the Consolidated Sanitary District also has an additional $29.5 million in bonded debt reserves available to apply against future debt costs not recoverable through State and federal grants and associated with the ACJ project.

As stated above, in addition to the CSO abatement projects, a central element of the ACJ plan is the reduction of ammonia and phosphorus levels in the METRO effluent. The ACJ set forth requirements for reduction of ammonia and phosphorus effluent in three increasingly stringent stages. As the result of value engineering, the County completed construction of a combined $129 million Stage III Ammonia/Stage II Phosphorus Removal Project that replaced plans for separate ammonia and phosphorus removal facilities and resulted in significant cost savings. The ammonia removal component of the combined facility went online in January 2004 and has consistently met stringent Stage III limits for effluent ammonia. The phosphorus removal component of the combined facility went online in April 2005 and is meeting Stage II removal standards.

Sampling data collected through the ACJ mandated Ambient Monitoring Program has shown significant improvements in lake water quality following completion of the ammonia and Stage II phosphorus facilities. These significant improvements may support arguments against the need for further phosphorus upgrades. Whether these arguments, if advanced, will result in relief from the Stage III phosphorus limits or permit the use of other less costly technology cannot be determined with reasonable certainty at this time. As required by the Fourth Stipulation to the ACJ, an interim phosphorus limit of 0.10 mg/l has been placed on the METRO WWTP effluent, and the County is conducting a study to optimize phosphorus removal with the existing facility. Also required is the completion of a work plan to investigate alternatives that will achieve a 0.02 mg/l of effluent phosphorus from METRO.

In a separate development that may impact the ACJ projects, in January 2005 the New York State DEC notified the County of its intention to modify the State Pollution Elimination System Permit for METRO. The Onondaga Indian Nation, ASLF and Midland Project opponents filed comments with the DEC on these Permit modifications. In July 2009, the DEC provided the County and interested community groups with a revised METRO Permit. Public comments on the proposed revised permit closed on November 20, 2009. The County has submitted final comments to the DEC that continue to challenge, among other things, the DEC’s stated intent to incorporate into the Permit a requirement that the County regulate satellite communities.

See Notes to the Financial Statements #15 in Appendix C – County of Onondaga General Purpose Financial Statements.

Onondaga Nation Land Claim

In March 2005, the Onondaga Nation (the “Nation”) filed suit in Federal District Court for the Northern District of New York against the County, City of Syracuse, New York State and four private businesses over the ownership of land in the County. The anticipated area of land claim includes virtually all of the County and land as far north as the Canadian border and south to the Pennsylvania border. New York State has retained a law firm to represent the County in this action. A motion to dismiss the Nation’s complaint was filed in 2007 and is presently pending before the Court.

The land claim includes Onondaga Lake and its tributaries. The Nation has publicly announced its intent to use the land claim action to establish its right to comment on environmental improvements to Onondaga Lake and its tributaries.

Also, the Nation sent a letter challenging the County’s ability to enforce taxes on Town of Onondaga land the Nation acquired in free market transactions. The issue of the ability of a County to acquire tax delinquent land owned by Indian Nations was litigated in U.S. District Court between the Oneida Indian Nation and Madison County, New York. In 2005, the Federal District Court permanently enjoined Madison County from foreclosing on property held by the Oneida Nation based on claims of tax delinquency. Recently, the Federal Circuit Court of Appeals for the Second Circuit affirmed the immunity of Indian Nations in New York from suits such as tax foreclosure actions. To date, the Onondaga Nation has not made significant land acquisitions in the County.

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Allied Case

Although located in Onondaga County, Onondaga Lake is a New York State-owned waterway held in trust by the State. In 1989, the State of New York initiated litigation against AlliedSignal, which resulted in a Consent Decree in 1992 pursuant to which AlliedSignal agreed to conduct an extensive remedial investigation of industrial contaminants in Onondaga Lake and portions of the Geddes Brook-Nine Mile Creek system.

In 1994, the Onondaga Lake sediments were listed in the National Priorities List (NPL) as a CERCLA Superfund Site. The site is comprised of the Onondaga Lake sediments and its environs. As such, the site is considered by the United States and the State of New York as being comprised of a number of sub-sites.

In 1994, AlliedSignal commenced a contribution action against the County contending that the County may be liable for some share of any CERCLA and other response costs, as well as an unspecified percentage of any natural resources damages, which ultimately may be assessed against AlliedSignal. As such, AlliedSignal contended that the County is a potentially responsible party. AlliedSignal merged with Honeywell International, Inc. in 1999 and now operates under the Honeywell name.

On December 31, 2002, the State issued a final Remedial Investigation Study. On February 11, 2004 the County and Honeywell signed a Stipulated Judgment settling the litigation between the parties. The Stipulated Judgment was filed on August 6, 2004. Pursuant to that settlement, Honeywell agreed to withdraw its lawsuit against the County with prejudice. The Stipulated Judgment also contains reciprocal releases and covenants not to sue. By its terms, the settlement creates a contingent liability, which requires the County to pay a total sum of $1,000,000 if, and only if, Honeywell spends more than $200,000,000 in mercury-related remediation in Onondaga Lake within twelve years following entry of the Judgment.

On November 29, 2004, Honeywell submitted a revised Feasibility Study Report to the State. On the same date, the State unveiled a Proposed Remedial Action Plan (PRAP) for Onondaga Lake. On July 1, 2005, the State issued a Record of Decision outlining the selected remedies for Onondaga Lake.

In September 2005, the New York State Department of Environmental Conservation (NYSDEC) notified the County and sixteen other entities that the State and the Environmental Protection Agency had incurred oversight costs with respect to the Onondaga Lake NPL site in the amount of $16,000,000. Thereafter, the County and others entered into Tolling Agreements with the NYSDEC, which suspended the running of any applicable statute of limitation pending negotiations. The present tolling agreement runs to June 15, 2010. Based on recent developments discussed below, this Tolling Agreement may be extended for an additional six months.

In October 2006, the State and Honeywell submitted to the U.S. District Court for the Northern District of New York, a proposed Consent Decree, which was approved on January 4, 2007. The Consent Decree requires Honeywell to implement the agreed remediation plan within nine years. Documents accompanying the proposal estimate Honeywell’s cost of implementing the agreed plan for remediation at $451,000,000.

On October 31, 2008, the Environmental Protection Agency (EPA) and the NYSDEC served a Demand for Payment letter upon seventeen Potentially Responsible Parties (PRPs), including Onondaga County. The Demand letter addressed to the County identifies the County’s PRP status as related to the Town of Salina Landfill, a sub-site of the Onondaga Lake NPL site. The agencies demand reimbursement of CERCLA-related oversight costs in the amount of $12,498,818.63. The County has advised Honeywell that it expects any contribution as a PRP to be applied to the County's $1 million settlement limit with Honeywell. Should that position not be sustained, an additional exposure to the County of $400,000 to $800,000 is possible.

Settlement negotiations of the EPA’s and NYSDEC’s Demand are continuing. These negotiations have been complicated by the bankruptcy proceedings instituted by Crucible Specialty Metals and General Motors, two principle PRPs. The County has filed claims in these proceedings.

In its Third Amended Disclosure Statement in Support of Amended Plan of Liquidation, Crucible has advised the U.S. Bankruptcy Court for the District of Delaware, of its intent to oppose the County’s claim. In a separate but related development, the ENPRO Corporation, successor in interest to Colt Industries, a co-guarantor of Crucible’s obligations to maintain the Geddes Landfill, has advised the County of its intention to assume Crucible’s maintenance obligations.

By letter dated October 30, 2009, the EPA requested that the County and other alleged PRPs enter into negotiations with the EPA to conduct a Remedial Investigation and Feasibility Study (RI/FS) of a yet to be fully defined site which the EPA is referring to as the Lower Ley Creek site. The County is awaiting further input from the EPA and the other named parties before taking a position.

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The County has filed a claim to recover costs that may be incurred as a result of the EPA’s demands in the G.M. Motors Liquidation bankruptcy proceedings. G.M. Motors Liquidation filed a motion to subject the County’s claim, among many others, to compulsory Alternative Dispute Resolution. The County successfully opposed the motion resulting in an agreement by G.M. Motors Liquidation to enter into settlement discussions with holders of environmental claims. Settlement discussions have not yet been scheduled.

By letter dated March 11, 2010, the EPA advised National Grid of the agency’s determination to designate the company as a PRP with respect to the Onondaga Lake Superfund site due to releases from property formally owned by Niagara Mohawk Power Corp., National Grid’s predecessor in interest, at 600 Hiawatha Blvd. The EPA alleges that the property is contaminated with hazardous substances generated by Niagara Mohawk in the course of operating a manufactured gas plant. In 2001, the County acquired the property from Niagara Mohawk. Therefore, the EPA’s letter advised National Grid and the County that the agency was evaluating whether to list the County as a PRP as well. Pursuant to an agreement between the County and Niagara Mohawk at the time of transfer of the property, the County contends that National Grid, as successor in interest to Niagara Mohawk, retains liability for the site. By letter dated March 25, 2010, the County gave National Grid notice of a potential claim as required by the agreement.

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

By Resolution No. 28-1978, the County involved itself in certain aspects of disposal of solid waste in Onondaga County. Pursuant to this Resolution, the County took steps that currently provide for the disposal of a significant portion of the solid waste generated in 33 of the 35 local political subdivisions (the “Participating Municipalities”) in Onondaga County.

In order to control the disposal of solid waste in Onondaga County, the following steps were taken to create a solid waste disposal system. First, Onondaga County and the Participating Municipalities obtained state legislation creating OCRRA, a state agency specifically vested with the duty to manage the disposal of solid waste in Onondaga County. Next, Onondaga County entered into twenty-five year agreements with the Participating Municipalities to deliver solid waste collected in the municipalities to Onondaga County (the delivery agreements). Third, over a period of several years, it enacted flow control legislation and site designation legislation applicable to the Participating Municipalities. The legislation substantially requires the disposal of most solid waste generated in the Participating Municipalities through the Onondaga County system. The most recent legislation was enacted in response to Court rulings limiting the ability of local governments to interfere in the commerce of solid waste disposal.

As an integral part of the implementation of this system, Onondaga County entered into an agreement with OCRRA to manage solid waste disposal in the Participating Municipalities (the Management Agreement) and assigned the delivery agreements entered into by the participating municipalities and the County to OCRRA. Also, Onondaga County, as the Solid Waste Management Planning Unit, produced a twenty year Solid Waste Management Plan that included Waste-to-Energy as part of solid waste management in the County. The Plan was approved by the State in November 1992.

OCRRA has, since that time, operated the system through construction of a Waste-To-Energy facility (WTE), an agreement with Covanta, LLP to operate the facility and agreements with local haulers to bring suitable solid waste to the facility. Residue from the facility is disposed of primarily through landfill agreements with out-of-County facilities. OCRRA also maintains ownership of property within Onondaga County that is intended as a landfill site if such a use becomes necessary or desirable.

In order to construct and implement the OCRRA WTE facility, $184 million in bonds were issued by OCRRA. According to OCRRA, in 2003 it refinanced its debt and created two tiers of debt, $82 million in “senior lien debt” and $30 million in “subordinate lien debt.” The senior lien debt will be defeased by 2015. The subordinate lien debt will be defeased no later than 2022. As part of that refinancing, OCRRA agreed to the transfer of the facility and facility site to Covanta, as early as 2015, upon Covanta’s meeting certain terms and conditions including payment of $1 for the facility, fair market value for the facility site and assumption of the subordinate lien debt. There are other provisions for extending the Site lease and for transferring ownership set forth in the 2003 documents. The OCRRA bonds continue to be secured by the delivery agreements that Onondaga County assigned to OCRRA. These agreements expire between 2013 and 2015. Both by state legislation and agreement, the County is not liable for OCRRA debts. OCRRA has, as an additional means of securing these revenues; secured contracts with major haulers providing for the haulers to deliver waste to OCRRA that currently expire in 2010. OCRRA’s ability to renew these contracts past 2010 is unknown.

As referenced above, since construction of the facility, the scope of municipalities' ability to regulate the disposal of waste has been narrowed due to Supreme Court case law and changes in the waste disposal market. In prior years, various Participating Municipalities and waste haulers have threatened to challenge the validity of the delivery agreements based upon 46

the desire to seek more competitive tipping fees available in the market place. OCRRA has maintained that the Participating Municipalities are contractually committed to deliver the solid waste that will provide the revenue to pay off the current bonded indebtedness throughout the terms of the delivery agreements. OCRRA has also opined that it is incumbent upon the municipalities to adopt a method of complying with the delivery agreements while simultaneously conforming to U.S. Supreme Court rulings that limit flow control. OCRRA has, in the past, urged that the Participating Municipalities take action to control the delivery of waste or subsidize OCRRA in order to avert a financial crisis upon termination of hauler contracts.

The County and OCRRA have assisted the Participating Municipalities in their commitments by agreeing to defend and indemnify those municipalities that choose to enact intrastate site designation laws. These site designation laws are designed to commit disposal of the municipalities' solid waste to the most environmentally sound available disposal site. To date 28 of the 33 Participating Municipalities have enacted these laws. Additionally, 25 of those 28 municipalities have signed defense and indemnification agreements with the County. These municipalities have determined that the OCRRA WTE Plant is the most environmentally beneficial available disposal site. This designation may further assist in securing the waste stream for OCRRA. On February 3, 2003, in order to further support the solid waste disposal system in Onondaga County, the Onondaga County Legislature enacted a Local Law which directs that all solid waste generated within Onondaga County, except Construction and Demolition waste and recyclables, be disposed of at an OCRRA approved site. This Local Law is applicable in the Participating Municipalities that are contained in Onondaga County. The U.S. Supreme Court has held that similar legislation is valid for publicly owned facilities. OCRRA, in order to support the County’s assistance to the system, has entered into a defense and indemnification agreement with the County whereby OCRRA agrees to pay the defense costs and expenses associated with potential litigation arising out of enactment of this Local Law. OCRRA has further agreed to indemnify the County for damages and expenses that may result from litigation involving the County’s enactment of this Local Law. If OCRRA fails to enforce the delivery agreements, the Trustee for holders of OCRRA's bonds may proceed against OCRRA, Onondaga County, and the Participating Municipalities to enforce the delivery agreements.

As stated above, OCRRA advises that in 2015 Covanta has the opportunity to take title to the facility and facility site. Since the distinction currently recognized by the Courts between valid and invalid interstate site designation legislation rests upon the public ownership and operation of the waste disposal system, OCRRA’s transfer of ownership of the facility and/or facility site to Covanta may impact the County’s efforts to exercise flow control through its governmental powers. The decision by Participating Municipalities not to renew their delivery agreements may also call into question the viability of operating the system in the manner it is presently operated. Any renewed and/or revised County Solid Waste Management Plan must necessarily take these factors into account.

TAX MATTERS

General

In the opinion of Bond Counsel, based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, the accuracy of certain representations and compliance with certain covenants, interest on the Series A Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 (the "Code"). In the further opinion of Bond Counsel, interest on the Series A Bonds is not a specific preference item for purposes of the federal individual and corporate alternative minimum taxes, nor is it included in adjusted current earnings when calculating corporate alternative minimum taxable income. Bond Counsel is of the opinion that interest on the Series B Bonds and Recovery Zone Bonds is not excluded from gross income for federal income tax purposes. Bond Counsel is also of the opinion that interest on the Bonds is exempt from personal income taxes imposed by the State of New York and any political subdivision thereof (including The City of New York). A complete copy of the proposed form of opinion of Bond Counsel is set forth in APPENDIX - D and - E hereto.

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Series A Bonds

Series A Bonds purchased, whether at original issuance or otherwise, for an amount higher than their principal amount payable at maturity (or, in some cases, at their earlier call date) ("Premium Bonds") will be treated as having amortizable bond premium. No deduction is allowable for the amortizable bond premium in the case of bonds, like the Premium Bonds, the interest on which is excluded from gross income for federal income tax purposes. However, the amount of tax-exempt interest received, and a Beneficial Owner's basis in a Premium Bond, will be reduced by the amount of amortizable bond premium properly allocable to such Beneficial Owner. Beneficial Owners of Premium Bonds should consult their own tax advisors with respect to the proper treatment of amortizable bond premium in their particular circumstances.

The Code imposes various restrictions, conditions and requirements relating to the exclusion from gross income for federal income tax purposes of interest on obligations such as the Series A Bonds. The County has made certain representations and covenanted to comply with certain restrictions, conditions and requirements designed to ensure that interest on the Series A Bonds will not be included in federal gross income. Inaccuracy of these representations or failure to comply with these covenants may result in interest on the Series A Bonds being included in gross income for federal income tax purposes, possibly from the date of original issuance of the Series A Bonds. The opinion of Bond Counsel assumes the accuracy of these representations and compliance with these covenants. Bond Counsel has not undertaken to determine (or to inform any person) whether any actions taken (or not taken), or events occurring (or not occurring), or any other matters coming to Bond Counsel's attention after the date of issuance of the Series A Bonds may adversely affect the value of, or the tax status of interest on, the Series A Bonds. Accordingly, the opinion of Bond Counsel is not intended to, and may not, be relied upon in connection with any such actions, events or matters.

Although Bond Counsel is of the opinion that interest on the Series A Bonds is excluded from gross income for federal income tax purposes and is exempt from personal income taxes imposed by the State of New York and any political subdivision thereof (including The City of New York), the ownership or disposition of, or the accrual or receipt of interest on, the Series A Bonds may otherwise affect a Beneficial Owner's federal, state or local tax liability. The nature and extent of these other tax consequences depends upon the particular tax status of the Beneficial Owner or the Beneficial Owner's other items of income or deduction. Bond Counsel expresses no opinion regarding any such other tax consequences.

Future legislative proposals, if enacted into law, clarification of the Code or court decisions may cause interest on the Series A Bonds to be subject, directly or indirectly, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent Beneficial Owners from realizing the full current benefit of the tax status of such interest. The introduction or enactment of any such future legislative proposals, clarification of the Code or court decisions may also affect the market price for, or marketability of, the Series A Bonds. Prospective purchasers of the Series A Bonds should consult their own tax advisors regarding any pending or proposed federal or state tax legislation, regulations or litigation, as to which Bond Counsel expresses no opinion.

The opinion of Bond Counsel is based on current legal authority, covers certain matters not directly addressed by such authorities, and represents Bond Counsel's judgment as to the proper treatment of the Series A Bonds for federal income tax purposes. It is not binding on the Internal Revenue Service ("IRS") or the courts. Furthermore, Bond Counsel cannot give and has not given any opinion or assurance about the future activities of the County, or about the effect of future changes in the Code, the applicable regulations, the interpretation thereof or the enforcement thereof by the IRS. The County has covenanted, however, to comply with the requirements of the Code.

Bond Counsel's engagement with respect to the Series A Bonds ends with the issuance of the Series A Bonds, and, unless separately engaged, Bond Counsel is not obligated to defend the County or the Beneficial Owners regarding the tax-exempt status of the Series A Bonds in the event of an audit examination by the IRS. Under current procedures, parties other than the County and its appointed counsel, including the Beneficial Owners, would have little, if any, right to participate in the audit examination process. Moreover, because achieving judicial review in connection with an audit examination of tax-exempt bonds is difficult, obtaining an independent review of IRS positions with which the County legitimately disagrees, may not be practicable. Any action of the IRS, including but not limited to selection of the Series A Bonds for audit, or the course or result of such audit, or an audit of bonds presenting similar tax issues may affect the market price for, or the marketability of, the Series A Bonds, and may cause the County or the Beneficial Owners to incur significant expense.

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Series B Bonds and Recovery Zone Bonds

The following discussion summarizes certain U.S. federal tax considerations generally applicable to holders of the Series B Bonds and Recovery Zone Bonds that acquire their Series B Bonds and Recovery Zone Bonds in the initial offering. The discussion below is based upon laws, regulations, rulings, and decisions in effect and available on the date hereof, all of which are subject to change, possibly with retroactive effect. Prospective investors should note that no rulings have been or are expected to be sought from the IRS with respect to any of the U.S. federal income tax consequences discussed below, and no assurance can be given that the IRS will not take contrary positions. Further, the following discussion does not deal with all U.S. federal income tax consequences applicable to any given investor, nor does it address the U.S. federal income tax considerations applicable to categories of investors some of which may be subject to special taxing rules (regardless of whether or not such persons constitute U.S. Holders), such as certain U.S. expatriates, banks, REITs, RlCs, insurance companies, tax-exempt organizations, dealers or traders in securities or currencies, partnerships, S corporations, estates and trusts, investors that hold their Series B Bonds and Recovery Zone Bonds as part of a hedge, straddle or an integrated or conversion transaction, or investors whose "functional currency" is not the U.S. dollar. Furthermore, it does not address (i) alternative minimum tax consequences or (ii) the indirect effects on persons who hold equity interests in a holder. In addition, this summary generally is limited to investors that acquire their Series B Bonds and Recovery Zone Bonds pursuant to this offering for the issue price that is applicable to such Series B Bonds and Recovery Zone Bonds (i.e., the price at which a substantial amount of the Series B Bonds and Recovery Zone Bonds are sold to the public) and who will hold their Series B Bonds and Recovery Zone Bonds as "capital assets" within the meaning of Section 1221 of the Code.

As used herein, "U.S. Holder" means a beneficial owner of a Series B Bond and Recovery Zone Bond that for U.S. federal income tax purposes is an individual citizen or resident of the United States, a corporation or other entity taxable as a corporation created or organized in or under the laws of the United States or any state thereof (including the District of Columbia), an estate the income of which is subject to U.S. federal income taxation regardless of its source or a trust where a court within the United States is able to exercise primary supervision over the administration of the trust and one or more United States persons (as defined in the Code) have the authority to control all substantial decisions of the trust (or a trust that has made a valid election under U.S. Treasury Regulations to be treated as a domestic trust). As used herein, "Non-U.S. Holder" generally means a beneficial owner of a Series B Bond and Recovery Zone Bond (other than a partnership) that is not a U.S. Holder. If a partnership holds Series B Bonds and Recovery Zone Bonds, the tax treatment of such partnership or a partner in such partnership generally will depend upon the status of the partner and upon the activities of the partnership. Partnerships holding Series B Bonds and Recovery Zone Bonds, and partners in such partnerships, should consult their own tax advisors regarding the tax consequences of an investment in the Series B Bonds and Recovery Zone Bonds (including their status as U.S. Holders or Non-U.S. Holders).

U.S. Holders

The Series B Bonds and Recovery Zone Bonds are not expected to be treated as issued with original issue discount ("OID") for U.S. federal income tax purposes because the stated redemption price at maturity of the Series B Bonds and Recovery Zone Bonds is not expected to exceed their issue price, or because any such excess is expected to only be a de minimis amount (as determined for tax purposes).

Prospective investors that are not individuals or regular C corporations who are U.S. persons purchasing the Series B Bonds and Recovery Zone Bonds for investment should consult their own tax advisors as to any tax consequences to them from the purchase, ownership and disposition of the Series B Bonds and Recovery Zone Bonds.

Disposition of the Series B Bonds and Recovery Zone Bonds. Unless a non-recognition provision of the Code applies, the sale, exchange, redemption, retirement (including pursuant to an offer by the County) or other disposition of a Series B Bond and Recovery Zone Bond, will be a taxable event for U.S. federal income tax purposes. In such event, in general, a U.S. Holder of a Series B Bond and Recovery Zone Bond will recognize gain or loss equal to the difference between (i) the amount of cash plus the fair market value of property received (except to the extent attributable to accrued but unpaid interest on the Series B Bond and Recovery Zone Bond) and (ii) the U.S. Holder's adjusted tax basis in the Series B Bond and Recovery Zone Bond (generally, the purchase price paid by the U.S. Holder for the Series B Bond and Recovery Zone Bond). Any such gain or loss generally will be capital gain or loss. In the case of a noncorporate U.S. Holder of the Series B Bonds and Recovery Zone Bonds, the maximum marginal U.S. federal income tax rate applicable to any such gain will be lower than the maximum marginal U.S. federal income tax rate applicable to ordinary income if such U.S. holder's holding period for the Series B Bond and Recovery Zone Bond decreased by any amortized bond premium exceeds one year. The deductibility of capital losses is subject to limitations.

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Non-U.S. Holders

Interest. Subject to the discussion below under the heading "Information Reporting and Backup Withholding," payments of principal of, and interest on, any Series B Bond and Recovery Zone Bond to a Non-U.S. Holder, other than (1) a controlled foreign corporation, as such term is defined in the Code, which is related to the County through stock ownership and (2) a bank which acquires such Series B Bond and Recovery Zone Bond in consideration of an extension of credit made pursuant to a loan agreement entered into in the ordinary course of business, will not be subject to any U.S. withholding tax provided that the beneficial owner of the Series B Bond and Recovery Zone Bond provides a certification completed in compliance with applicable statutory and regulatory requirements, which requirements are discussed below under the heading "Information Reporting and Backup Withholding," or an exemption is otherwise established.

Disposition of the Series B Bonds and Recovery Zone Bonds. Subject to the discussion below under the heading "Information Reporting and Backup Withholding," any gain realized by a Non-U.S. Holder upon the sale, exchange, redemption, retirement (including pursuant to an offer by the County) or other disposition of a Series B Bond and Recovery Zone Bond generally will not be subject to U.S. federal income tax, unless (i) such gain is effectively connected with the conduct by such Non-U.S. Holder of a trade or business within the United States; or (ii) in the case of any gain realized by an individual Non-U.S. Holder, such holder is present in the United States for 183 days or more in the taxable year of such sale, exchange, redemption, retirement (including pursuant to an offer by the County) or other disposition and certain other conditions are met.

U.S. Federal Estate Tax. A Series B Bond and Recovery Zone Bond that is held by an individual who at the time of death is not a citizen or resident of the United States will not be subject to U.S. federal estate tax as a result of such individual's death, provided that, at the time of such individual's death, payments of interest with respect to such Series B Bond and Recovery Zone Bond would not have been effectively connected with the conduct by such individual of a trade or business within the United States.

Information Reporting and Backup Withholding. U.S. information reporting and "backup withholding" requirements apply to certain payments of principal of, and interest on, the Series B Bonds and Recovery Zone Bonds, and to proceeds of the sale, exchange, redemption, retirement (including pursuant to an offer by the County) or other disposition of a Series B Bond and Recovery Zone Bond, to certain noncorporate holders of Series B Bonds and Recovery Zone Bonds that are United States persons. Under current U.S. Treasury Regulations, payments of principal and interest on any Series B Bonds and Recovery Zone Bonds to a holder that is not a United States person will not be subject to any backup withholding tax requirements if the beneficial owner of the Series B Bond and Recovery Zone Bond or a financial institution holding the Series B Bond and Recovery Zone Bond on behalf of the beneficial owner in the ordinary course of its trade or business provides an appropriate certification to the payor and the payor does not have actual knowledge that the certification is false. If a beneficial owner provides the certification, the certification must give the name and address of such owner, state that such owner is not a United States person, or, in the case of an individual, that such owner is neither a citizen nor a resident of the United States, and the owner must sign the certificate under penalties of perjury. If a financial institution, other than a financial institution that is a qualified intermediary, provides the certification, the certification must state that the financial institution has received from the beneficial owner the certification set forth in the preceding sentence, set forth the information contained in such certification, and include a copy of such certification, and an authorized representative of the financial institution must sign the certificate under penalties of perjury. A financial institution generally will not be required to furnish to the IRS the names of the beneficial owners of the Series B Bonds and Recovery Zone Bonds that are not United States persons and copies of such owners' certifications where the financial institution is a qualified intermediary that has entered into a withholding agreement with the IRS pursuant to applicable U.S. Treasury Regulations.

In the case of payments to a foreign partnership, foreign simple trust or foreign grantor trust, other than payments to a foreign partnership, foreign simple trust or foreign grantor trust that qualifies as a withholding foreign partnership or a withholding foreign trust within the meaning of applicable U.S. Treasury Regulations and payments to a foreign partnership, foreign simple trust or foreign grantor trust that are effectively connected with the conduct of a trade or business within the United States, the partners of the foreign partnership, the beneficiaries of the foreign simple trust or the persons treated as the owners of the foreign grantor trust, as the case may be, will be required to provide the certification discussed above in order to establish an exemption from withholding and backup withholding tax requirements. The current backup withholding tax rate is 28% (subject to future adjustment).

In addition, if the foreign office of a foreign "broker," as defined in applicable U.S. Treasury Regulations pays the proceeds of the sale of a Bond to the seller of the Series B Bond and Recovery Zone Bond, backup withholding and information reporting requirements will not apply to such payment provided that such broker derives less than 50% of its gross income for certain specified periods from the conduct of a trade or business within the United States, is not a controlled foreign corporation, as such term is defined in the Code, and is not a foreign partnership (1) one or more of the partners of which, at any time during its tax year, are U.S. persons (as defined in U.S. Treasury Regulations Section 1.1441- 1(c)(2» who, in the aggregate hold more than 50% of the income or capital interest in the partnership or (2) which, at any time during its tax 50

year, is engaged in the conduct of a trade or business within the United States. Moreover, the payment by a foreign office of other brokers of the proceeds of the sale of a Series B Bond and Recovery Zone Bond, will not be subject to backup withholding unless the payer has actual knowledge that the payee is a U.S. person. Principal and interest so paid by the U.S. office of a custodian, nominee or agent, or the payment by the U.S. office of a broker of the proceeds of a sale of a Series B Bond and Recovery Zone Bond, is subject to backup withholding requirements unless the beneficial owner provides the nominee, custodian, agent or broker with an appropriate certification as to its non-U. S. status under penalties of perjury or otherwise establishes an exemption.

LEGAL MATTERS

Legal matters incident to the authorization, issuance and sale of the Bonds are subject to the approving legal opinion of Orrick, Herrington & Sutcliffe, LLP, Bond Counsel. Bond Counsel’s opinion will be in substantially the form attached hereto as APPENDIX - D and - E.

CONTINUING DISCLOSURE UNDERTAKING WITH RESPECT TO THE BONDS

In accordance with the requirements of Rule 15c2-12 (the "Rule"), as the same may be amended or officially interpreted from time to time, promulgated by the Securities and Exchange Commission (the "Commission"), the County has agreed to provide, or cause to be provided,

(i) during each fiscal year in which the bonds are outstanding, to the Electronic Municipal Market Access (“EMMA”) system of the Municipal Securities Rulemaking Board ("MSRB"), or any other entity designated or authorized by the Commission to receive reports pursuant to the Rule certain annual financial information and operating data for the preceding fiscal year, in a form generally consistent with the information contained or cross-referenced under the headings: “THE COUNTY”, “FINANCIAL STRUCTURE”, “TAX INFORMATION”, “COUNTY INDEBTEDNESS”, “LITIGATION”, and a copy of the audited financial statement (prepared in accordance with generally accepted accounting principles in effect at the time of the audit) for the preceding fiscal year, if any; such information, data and audit, if any, will be so provided on or prior to the later of either the end of the sixth month of each fiscal year or, if audited financial statements are prepared, sixty days following receipt by the County of audited financial statements for the preceding fiscal year, but, in no event, not later than the last business day of each fiscal year.

(ii) in a timely manner, to the MSRB or any other entity designated or authorized by the Commission to receive reports pursuant to the Rule, notice of the occurrence of any of the following events with respect to the Bonds, if such event is material: (a) principal and interest payment delinquencies (b) non-payment related defaults (c) unscheduled draws on debt service reserves reflecting financial difficulties (d) unscheduled draws on credit enhancements reflecting financial difficulties (e) substitution of credit or liquidity providers, or their failure to perform (f) adverse tax opinions or events affecting the tax-exempt status of the Bonds (g) modifications to rights of Bondholders (h) bond calls (i) defeasances (j) release, substitution, or sale of property securing repayment of the Bonds (k) rating changes The County may from time to time choose to provide notice of the occurrence of certain other events, in addition to those listed above, if the County determines that any such other event is material with respect to the Bonds; but the County does not undertake to commit to provide any such notice of the occurrence of any material event except those events listed above.

(iii) in a timely manner, to the MSRB or any other entity designated or authorized by the Commission to receive reports pursuant to the Rule, notice of its failure to provide the aforedescribed annual financial information and operating data and such audited financial statement, if any, on or before the date specified.

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The County reserves the right to terminate its obligations to provide the aforedescribed annual financial information and operating data and such audited financial statement, if any, and notices of material events, as set forth above, if and when the County no longer remains an obligated person with respect to the Bonds, within the meaning of the Rule. The County acknowledges that its undertaking pursuant to the Rule described under this heading is intended to be for the benefit of the holders of the Bonds (including holders of beneficial interests in the Bonds). The right of holders of the Bonds to enforce the provisions of the undertaking will be limited to a right to obtain specific enforcement of the County's obligations under its continuing disclosure undertaking and any failure by the County to comply with the provisions of the undertaking will neither be a default with respect to the Bonds nor entitle any holder of the Bonds to recover monetary damages.

The County reserves the rights to modify from time to time the specific types of information provided or the format of the presentation of such information, to the extent necessary or appropriate in the judgment of the County; provided that, the County agrees that any such modification will be done in a manner consistent with the Rule.

A Continuing Disclosure Undertaking Certificate to this effect shall be provided to the purchaser at closing.

The County is in compliance with all prior undertakings pursuant to the Rule.

FINANCIAL ADVISORS

Fiscal Advisors & Marketing, Inc. and Government Finance Associates, Inc. (the “Financial Advisors”) serve as independent financial advisors to the County on matters relating to debt management. The Financial Advisors are financial advisory and consulting organizations and are not engaged in the business of underwriting, marketing, or trading municipal securities or any other negotiated instruments. The Financial Advisors have provided advice as to the plan of financing and the structuring of the Bonds and have reviewed and commented on certain legal documents, including this Official Statement. The advice on the plan of financing and the structuring of the Bonds was based on materials provided by the County and other sources of information believed to be reliable. The Financial Advisors have not audited, authenticated, or otherwise verified the information provided by the County or the information set forth in this Official Statement or any other information available to the County with respect to the appropriateness, accuracy, or completeness of disclosure of such information and no guarantee, warranty, or other representation is made by the Financial Advisors with respect to the accuracy and completeness of or any other matter related to such information and this Official Statement.

RATINGS

Fitch Ratings, Moody's Investors Service, Inc. and Standard and Poor's Rating Services, a Division of The McGraw Hill Companies have assigned their municipal bond ratings of “AAA (negative outlook)”, “Aa1” and “AA+ (stable outlook)” respectively, to the Bonds. Such ratings reflect only the view of such organizations, and an explanation of the significance of such ratings may be obtained from: Fitch Ratings, One State Street Plaza, New York, New York 10004, (212) 908-0500, Moody's Investors Service, Inc., 7 World Trade Center, 250 Greenwich Street, 23rd Floor, New York, New York 10007, (212) 553-0300 and Standard & Poor’s Credit Market Services, 55 Water Street, New York, New York 10041, (212) 438-2400. There is no assurance that such ratings will continue for any given period of time or that such ratings will not be revised or withdrawn by such rating agency, if in its judgment, circumstances so warrant. A revision or withdrawal of such ratings may have an effect on the market price of the Bonds.

The Fitch and Moody’s ratings are reflective of the respective firms recalibration of ratings on April 30, 2010 and April 16, 2010, respectively. Fitch recalibrated the County’s rating from AA+ to AAA and Moody’s recalibrated the County’s rating from Aa2 to Aa1.

ADDITIONAL INFORMATION

Statements in the Official Statement, and the documents included by specific reference, that are not historical facts are “forward-looking statements”, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the Private Securities Litigation Reform Act of 1995, which involve a number of risks and uncertainties, and which are based on the County’s management’s beliefs as well as assumptions made by, and information currently available to, the County’s management and staff. Because the statements are based on expectations about future events and economic performance and are not statements of fact, actual results may differ materially from those projected. Important factors that could cause future results to differ include legislative and regulatory changes, changes in the economy, and other factors discussed in this and other documents that the County’s files with the repositories. When used in County’s documents or oral presentation, the words “anticipate”, “believe”, “intend”, “plan”, “forsee”, “likely”, “estimate”, “expect”, “objective”, “projection”, “forecast”, “goal”, “will”, or “should”, or similar words or phrases are intended to identify forward-looking statements.

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To the extent any statements made in this Official Statement involve matters of opinion or estimates, whether or not expressly stated, they are set forth as such and not as representations of fact, and no representation is made that any of the statements will be realized. Neither this Official Statement nor any statement which may have been made verbally or in writing is to be construed as a contract with the holder of the Bonds.

Orrick, Herrington & Sutcliffe LLP, New York, New York, Bond Counsel to the County, expresses no opinion as to the accuracy or completeness of information in any documents prepared by or on behalf of the County for use in connection with the offer and sale of the Bonds, including but not limited to, the financial or statistical information in this Official Statement.

References herein to the Constitution of the State and various State and federal laws are only brief outlines of certain provisions thereof and do not purport to summarize or describe all of such provisions.

Concurrently with the delivery of the Bonds, the County will furnish a certificate to the effect that as of the date of the Official Statement, the Official Statement did not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements herein, in the light of the circumstances under which they were made, not misleading, subject to limitation as to information in the Official Statement obtained from sources other than the County, as to which no representation can be made.

The Official Statement is submitted only in connection with the sale of the Bonds by the County and may not be reproduced or used in whole or in part for any other purpose.

The County hereby disclaims any obligation to update developments of the various risk factors or to announce publicly any revision to any of the forward-looking statements contained herein or to make corrections to reflect future events or developments except to the extent required by Rule 15c2-12 promulgated by the Securities and Exchange Commission.

Any statements made in this Official Statement and indicated to involve matters of opinion or estimates are represented to be opinions or estimates in good faith. No assurance can be given, however, that the facts will materialize as so opined or estimated. Neither this Official Statement nor any statement which may have been made verbally or in writing is to be construed as a contract with the holders of the Bonds.

Additional copies of this Official Statement may be obtained upon request from the office of the Chief Fiscal Officer, 421 Montgomery Street, Syracuse, New York 13202 (315-435-3346), from Fiscal Advisors & Marketing, Inc., 120 Walton Street, Suite 600, Syracuse, New York 13202 (315-752-0051), or from Government Finance Associates, Inc., 590 Madison Avenue, 21st Floor, New York, New York 10022 (212-521-4091), downloaded from Fiscal Advisors & Marketing, Inc.'s Internet address: http://www.fiscaladvisors.com or I-Deal Prospectus’s Internet address: http://www.tm3.com.

Fiscal Advisors & Marketing, Inc. and the County may place a copy of this Official Statement on their websites at www.fiscaladvisors.com and www.ongov.net, respectively. Unless this Official Statement specifically indicates otherwise, no statement on such website is included by specific reference or constitutes a part of this Official Statement. Fiscal Advisors & Marketing, Inc. and the County have prepared such website information for convenience, but no decisions should be made in reliance upon that information. Typographical or other errors may have occurred in converting original source documents to digital format, and neither the County nor Fiscal Advisors & Marketing, Inc. assumes any liability or responsibility for errors or omissions on such website. Further, Fiscal Advisors & Marketing, Inc. and the County disclaim any duty or obligation either to update or to maintain that information or any responsibility or liability for any damages caused by viruses in the electronic files on the website. Fiscal Advisors & Marketing, Inc. and the County also assume no liability or responsibility for any errors or omissions or for any updates to dated website information.

The County will act as Paying Agent for the Bonds. The County’s contact information is as follows: Chief Fiscal Officer, John H. Mulroy Civic Center, 421 Montgomery Street, Syracuse, New York 13202-2998, Phone: (315) 435-3346, Telefax: (315) 435-3439.

This Official Statement has been duly executed and delivered by the Chief Fiscal Officer of the County of Onondaga, New York.

COUNTY OF ONONDAGA

/s/ James Rowley Dated: June 15, 2010 Chief Fiscal Officer

53 APPENDIX A Onondaga County

GENERAL FUND

Balance Sheets

Fiscal Years Ending December 31: 2005 2006 2007 2008 2009

ASSETS Cash and Investments$ 60,122,953 $ 69,435,440 $ 67,756,032 $ 48,643,683 $ 29,452,648 Receivables: Property Taxes 27,613,312 26,624,081 30,991,185 35,543,011 28,625,100 Accounts Receivable 17,820,807 42,525,413 43,668,493 41,630,113 53,361,555 Due from Federal and State Governments 48,212,923 56,541,576 54,383,361 61,622,270 70,360,821 Due from Other Governments 4,645,949 3,660,561 4,015,152 4,204,064 3,771,489 Due from Other Funds 3,540,908 5,710,299 1,234,403 1,759,393 3,702,536 Prepaid Expenditures & Other Assets 3,607,290 3,375,018 3,514,019 2,870,769 2,939,410

TOTAL ASSETS$ 165,564,142 $ 207,872,388 $ 205,562,645 $ 196,273,303 $ 192,213,559

LIABILITIES AND FUND EQUITY Accounts Payable and Accrued Liabilities$ 30,868,333 $ 36,545,996 $ 40,720,379 $ 39,240,954 $ 36,743,282 Due to Other Governments 54,478,263 71,555,001 71,833,427 66,806,199 71,031,359 Due to Other Funds 1,800,000 900,000 1,300,000 1,800,000 1,900,000 Deferred Property Tax Revenues 10,581,672 8,937,627 9,508,003 13,732,074 6,924,913 Other Deferred Revenues 2,285,537 5,508,622 1,713,514 3,909,130 932,570 Contracts Payable - Retainage 379 - 11,872 11,134 15,241 Other Liabilities 76,713 69,756 126,298 61,211 256

TOTAL LIABILITIES 100,090,897 123,517,002 125,213,493 125,560,702 117,547,621

FUND EQUITY Reserved: Prepaids$ 3,607,290 $ 3,375,018 $ 3,514,019 $ 2,870,769 $ 2,939,410 Encumbrances 1,838,536 2,640,247 2,572,148 1,967,320 2,352,640 Unreserved: Appropriated 3,400,000 15,575,000 14,083,308 6,011,553 8,759,703 Unappropriated 56,627,419 62,765,121 60,179,677 59,862,959 60,614,185

TOTAL FUND EQUITY 65,473,245 84,355,386 80,349,152 70,712,601 74,665,938

TOTAL LIABILITIES and FUND EQUITY$ 165,564,142 $ 207,872,388 $ 205,562,645 $ 196,273,303 $ 192,213,559

Source: Audited financial reports of the County. This Appendix is not itself audited. APPENDIX A1 Onondaga County

GENERAL FUND

Revenues, Expenditures and Changes in Fund Balance

Fiscal Years Ending December 31: 2005 2006 2007 2008 2009

REVENUES Real Property Taxes and Tax Items$ 183,656,500 $ 190,731,861 $ 191,425,902 $ 183,730,470 $ 183,094,220 Non-Property (Sales) Taxes (1) 130,689,331 290,191,729 291,731,692 299,044,343 284,398,541 Revenues from Federal Sources 71,326,934 74,596,667 64,692,634 60,877,055 81,000,925 Revenues from State Sources 93,600,162 92,962,548 94,072,213 99,982,910 91,052,381 Departmental Income 24,141,202 23,917,576 24,605,583 25,566,932 27,186,470 Service for Other Governments 17,856,582 19,263,481 18,267,577 17,174,952 15,334,568 Sale of Receivables - - - - 11,270,385 Interest Earned 2,621,252 4,245,833 5,135,825 3,111,826 1,059,816 Miscellaneous 5,069,278 4,962,693 5,709,241 5,644,925 6,547,817 Total Revenues$ 528,961,241 $ 700,872,388 $ 695,640,667 $ 695,133,413 $ 700,945,123

EXPENDITURES General Government Support (1)$ 40,630,847 $ 188,777,967 $ 190,648,811 $ 196,276,069 $ 195,564,062 Economic Assistance and Opportunity 236,478,943 241,418,972 235,279,901 241,435,326 234,697,854 Health 37,377,658 38,564,073 40,884,530 42,775,449 39,752,199 Public Safety 100,621,395 104,162,317 105,704,967 111,338,806 108,131,830 Culture and Recreation 15,387,941 15,844,655 16,719,986 17,405,487 17,571,614 Education 43,533,866 44,514,055 48,253,633 51,383,514 51,636,672 Home and Community Services 2,586,137 2,723,343 2,939,365 2,806,402 3,243,401 Transportation 3,383,547 3,413,215 3,544,845 3,427,670 3,836,680 Debt Service 154,576 147,866 - - 0 Total Expenditures$ 480,154,910 $ 639,566,463 $ 643,976,038 $ 666,848,723 $ 654,434,312

Excess of Revenues Over (Under) Expenditures$ 48,806,331 $ 61,305,925 $ 51,664,629 $ 28,284,690 $ 46,510,811

Other Financing Sources (Uses): Operating Transfers In 23,892 1,206,278 206,361 8,714,565 46,504 Operating Transfers Out (35,214,522) (43,630,062) (55,877,224) (46,635,806) (42,603,978) Proceeds of Long Term Borrowing - - - - 0 Other - - - - 0 Total Other Financing (35,190,630) (42,423,784) (55,670,863) (37,921,241) (42,557,474)

Excess of Revenues and Other Sources Over (Under) Expenditures and Other Uses 13,615,701 18,882,141 (4,006,234) (9,636,551) 3,953,337

FUND BALANCE Fund Balance - Beginning of Year 51,857,544 65,473,245 84,355,386 80,349,152 70,712,601 Residual Equity Transfers (net) - - - - 0 Fund Balance - End of Year$ 65,473,245 $ 84,355,386 $ 80,349,152 $ 70,712,601 $ 74,665,938

(1) Includes sales tax gross up of $146,136,662, $146,702,282, $149,888,382, $149,343, 342 for 2006, 2007, 2008 and 2009, respectively due to accounting changes. See "Onondaga County Sales Tax" section of Official Statement.

Source: Audited financial reports of the County. This Appendix is not itself audited. APPENDIX A2 Onondaga County

ALL FUNDS

Revenues, Expenditures and Changes in Fund Balance - Budget

2006 2007 2008 2009 2010 Adopted Adopted Adopted Adopted Adopted Budget Budget Budget Budget Budget REVENUES Real Property Tax Levy$ 192,543,707 $ 193,102,057 $ 190,122,045 $ 190,230,361 $ 193,278,845 Special District Tax Levies 49,324,585 53,766,107 53,545,035 56,267,837 52,607,641 Non-Property (Sales) Taxes (1) 142,718,439 291,071,771 300,057,172 318,677,879 287,902,381 Revenues from State Sources 123,001,701 128,661,741 136,901,025 140,937,666 140,995,051 Revenues from Federal Sources 90,427,694 85,161,299 83,582,551 85,223,335 93,758,163 Other Receipts, Etc. 336,029,170 354,282,868 366,029,910 370,423,929 373,137,873 Total Revenues$ 934,045,296 $ 1,106,045,843 $ 1,130,237,738 $ 1,161,761,007 $ 1,141,679,954

EXPENDITURES General Government Support (1)$ 598,035,261 $ 751,291,345 $ 763,277,406 $ 780,109,745 $ 762,067,829 Community College 62,177,000 63,388,000 68,488,300 73,040,082 78,237,387 Community Development 3,956,348 3,561,222 3,632,450 3,554,192 3,937,839 Van Duyn Hospital 42,138,858 42,910,546 44,071,862 44,724,471 44,569,510 Grant 22,354,234 23,908,179 26,764,695 32,130,822 31,618,970 County Road 30,782,020 30,941,839 30,831,568 31,135,180 28,369,121 Road Machinery 6,935,125 7,487,603 7,607,544 8,826,120 6,888,200 Water 10,330,182 9,981,353 10,098,646 10,061,100 9,082,803 Water Environment Protection 62,799,429 66,976,795 70,631,922 71,519,921 71,607,746 Library 12,335,560 12,777,184 13,061,753 13,274,163 13,100,929 Debt Service 28,931,372 30,975,392 34,702,519 33,417,512 35,974,779 Insurance 65,062,340 69,342,689 73,928,296 72,549,805 78,932,030 Total Expenditures$ 945,837,729 $ 1,113,542,147 $ 1,147,096,961 $ 1,174,343,113 $ 1,164,387,143

Excess of Revenues Over (Under) Expenditures/ Budgetary Fund Balance Used$ (11,792,433) $ (7,496,304) $ (16,859,223) $ (12,582,106) $ (22,707,189)

(1) Includes sales tax gross up of $146,136,662, $146,702,282, $149,998,093, $154,354,343 and $149,809,115 for 2006, 2007, 2008, 2009 and 2010, respectively due to accounting changes. See "Onondaga County Sales Tax" section of Official Statement.

Source: Annual financial budgets of the County. This Appendix is not itself audited. APPENDIX - B Onondaga County

BONDED DEBT SERVICE

Fiscal Year Ending Excluding this Issue Principal of Total Principal December 31st Principal (1) Interest Total These Issues All Issues

2010 21,747,873.00 15,328,784.44 37,076,657.44 21,747,873 2011 25,320,000.00 13,622,182.97 38,942,182.97 25,320,000 2012 25,290,000.00 12,574,591.15 37,864,591.15 4,425,000 29,715,000 2013 23,035,000.00 11,571,677.44 34,606,677.44 4,950,000 27,985,000 2014 22,610,000.00 10,615,749.79 33,225,749.79 4,625,000 27,235,000 2015 21,570,000.00 9,693,518.56 31,263,518.56 5,100,000 26,670,000 2016 21,235,000.00 8,747,839.78 29,982,839.78 3,000,000 24,235,000 2017 20,880,000.00 7,779,233.60 28,659,233.60 3,000,000 23,880,000 2018 20,155,000.00 6,860,911.80 27,015,911.80 3,050,000 23,205,000 2019 18,875,000.00 6,014,606.62 24,889,606.62 3,000,000 21,875,000 2020 15,970,000.00 5,262,598.15 21,232,598.15 3,000,000 18,970,000 2021 15,430,000.00 4,567,521.10 19,997,521.10 2,800,000 18,230,000 2022 14,320,000.00 3,912,277.17 18,232,277.17 2,800,000 17,120,000 2023 13,790,000.00 3,296,902.98 17,086,902.98 2,800,000 16,590,000 2024 12,605,000.00 2,710,962.17 15,315,962.17 2,500,000 15,105,000 2025 9,190,000.00 2,198,485.55 11,388,485.55 2,450,000 11,640,000 2026 8,625,000.00 1,801,667.22 10,426,667.22 1,220,000 9,845,000 2027 6,165,000.00 1,463,116.42 7,628,116.42 1,225,000 7,390,000 2028 4,515,000.00 1,212,361.08 5,727,361.08 1,225,000 5,740,000 2029 3,690,000.00 998,715.48 4,688,715.48 1,225,000 4,915,000 2030 2,545,000.00 850,562.33 3,395,562.33 1,230,000 3,775,000 2031 2,575,000.00 727,399.28 3,302,399.28 2,575,000 2032 2,610,000.00 602,788.83 3,212,788.83 2,610,000 2033 2,640,000.00 476,493.38 3,116,493.38 2,640,000 2034 2,665,000.00 348,507.61 3,013,507.61 2,665,000 2035 2,700,000.00 219,192.25 2,919,192.25 2,700,000 2036 2,730,000.00 89,297.85 2,819,297.85 2,730,000

TOTALS $343,482,873 $133,547,945.00 $477,030,818.00 $53,625,000 $397,107,873

(1) Does not include defeased Bonds. Does include Environmental Facilities Bonds of $134,665,373.

APPENDIX C

COUNTY OF ONONDAGA, NEW YORK

COMPREHENSIVE ANNUAL FINANCIAL REPORT

DECEMBER 31, 2009

Such Audited Financial Statement and opinion were prepared as of the date thereof and have not been reviewed and/or updated in connection with the preparation and dissemination of this Official Statement.

COUNTY OF ONONDAGA, NEW YORK COMPREHENSIVE ANNUAL FINANCIAL REPORT EFFECTIVE JANUARY 1, 2010

PREPARED BY THE COMPTROLLER'S OFFICE

COUNTY COMPTROLLER

ROBERT E. ANTONACCI II, CPA

DEPUTY COMPTROLLER/ACCOUNTING DEPUTY COMPTROLLER/AUDITING

JAMES V. MATURO THOMAS G. SQUIRES

CHIEF GOVERNMENTAL ACCOUNTANT

ANTHONY P. CALOGERO

EXECUTIVE ASSISTANT

NANCY L. CAMPOLITO

ACCOUNTING STAFF

KAREN J. BUSKO SHARON L. MASTROENI

SUZANNE M. COWIN JOYCE E. WILSON

SHARON C. HUGHES

AUDITING STAFF

PHILIP M. BRITT LINDA M. MARNELL

ROXANNE R. BUGNACKI JULIUS F. PERROTTA

JOHN H. CLEMENTS JOSEPH B. WINKWORTH

ROBERT M. HOLLISTER KATHY C. WRIGHT

INDEPENDENT AUDITORS

TESTONE, MARSHALL, & DISCENZA, LLP COUNTY OF ONONDAGA, NEW YORK COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR ENDED DECEMBER 31, 2009 TABLE OF CONTENTS

PAGE

INTRODUCTORY SECTION (UNAUDITED)

List of Principal Officials ...... i Organization Chart ...... ii Letter of Transmittal...... iii

FINANCIAL SECTION

Independent Auditors' Report...... ix

Management's Discussion and Analysis...... xi

Basic Financial Statements:

Government-wide Financial Statements: Statement of Net Assets ...... …...... 1 Statement of Activities…………………………………………………………………………………………………… 3

Fund Financial Statements: Balance Sheet - Governmental Funds...... …………………………………………...... …………………… 5 Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds ...... 7 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities...... 9 Statement of Fund Net Assets - Internal Service Fund...... 10 Statement of Revenues, Expenses, and Changes in Fund Net Assets - Internal Service Fund ...... 11 Statement of Cash Flows - Internal Service Fund...... 12 Statement of Net Assets - Fiduciary Funds...... 13 Statement of Changes in Net Assets - Fiduciary Funds...... 13 Combining Statement of Net Assets - Component Units...... 14 Combining Statement of Revenues, Expenditures and Changes in Net Assets - Component Units……...... ………… 16 Notes to the Financial Statements ...... 18 Required Supplementary Information: Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis): General Fund ...... 42 Water Environment Protection ...... 44 Other Postemployment Benefits Plan Schedule of Funding Progress…………………………………………………… 44 Notes to the Required Supplementary Information ...... 45 COUNTY OF ONONDAGA, NEW YORK COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR ENDED DECEMBER 31, 2009 TABLE OF CONTENTS (Continued)

PAGE

SUPPLEMENTAL FINANCIAL INFORMATION

Combining Financial Statements and Budgetary Comparison Schedules: Combining Balance Sheet - Nonmajor Governmental Funds...... 46 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances - Nonmajor Governmental Funds ...... 48 Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) General Grants Fund ...... 50 County Road Fund...... 53 Road Machinery Fund ...... 54 Water Fund ...... 55 Van Duyn Extended Care Fund ...... 56 Library Fund ...... 57 Library Grants Fund...... 58 Community Development Fund...... 59 Debt Service Fund ...... 60

STATISTICAL SECTION (UNAUDITED)

Net Assets by Component-Last Six Fiscal Years...... 61 Changes in Net Assets-Last Six Fiscal Years...... 63 Fund Balances, Governmental Funds-Last Six Fiscal Years...... 65 Changes in Fund Balances, Governmental Funds-Last Six Fiscal Years …………………………………………………… 66 Assessed Value and Actual Value of Taxable Property-Last Ten Fiscal Years ……………………………………………… 68 Principal Property Taxpayers- Current Year and Nine Years Ago ...... 69 Property Tax Levies and Collections-Last Ten Fiscal Years ………………………………………………………………… 70 Overlapping and Underlying Governmental Activities Debt ………………………………………………………………… 71 Legal Debt Margin Information- Last Ten Fiscal Years ...... 72 Ratios of Outstanding Debt by Type- Last Ten Fiscal Years ...... 73 Demographic and Economic Statistics- Last Ten Calendar Years …………………………………………………………… 74 Principal Employers- Current Year and Nine Years Ago...... 75 Full-time Equivalent County Government Employees by Function/Program- Last Ten Fiscal Years ...... 76 Capital Asset Statistics by Function/Program- Last Ten Fiscal Years ……………………………………………………… 78

THIS PAGE INTENTIONALLY LEFT BLANK

INTRODUCTORY

SECTION

(UNAUDITED)

COUNTY OF ONONDAGA, NEW YORK

LIST OF PRINCIPAL OFFICIALS

COUNTY LEGISLATURE

EFFECTIVE JANUARY 1, 2010

CHAIRMAN: JAMES M. RHINEHART

THOMAS C. BUCKEL, JR. CASEY E. JORDAN ** WILLIAM H. MEYER

JAMES A. CORBETT PATRICK M. KILMARTIN KATHLEEN A. RAPP

ROBERT S. DeMORE WILLIAM T. KINNE MARK A. STANCZYK *

JOHN C. DOUGHERTY SAM LAGUZZA JUDITH A. TASSONE

LINDA R. ERVIN RICHARD M. LESNIAK * ROBERT D. WARNER

KEVIN A. HOLMQUIST MARTIN D. MASTERPOLE MONICA WILLIAMS

* FLOOR LEADERS ** CHAIR, WAYS & MEANS COMMITTEE

COUNTY COMPTROLLER COUNTY EXECUTIVE CHIEF FISCAL OFFICER ROBERT E. ANTONACCI II, CPA JOANNE M. MAHONEY JAMES ROWLEY

COUNTY SHERIFF DISTRICT ATTORNEY COUNTY CLERK KEVIN E. WALSH WILLIAM J. FITZPATRICK M. ANN CIARPELLI

i COUNTY OF ONONDAGA

ORGANIZATION CHART

VOTERS

Comptroller County Clerk District Attorney County Executive County Legislature Sheriff

Administrative & Financial Services Human Services Physical Services

Authorized Agencies-Financial Aging and Youth Long Term Care Authorized Agencies-Physical

Economic Development Authorized Agencies-Human Mental Health Department Information Technology ii

Elections Board Correction Department Onondaga County Public Library Facilities Management

Emergency Management E911-Emergency Communications Probation Department Metropolitan Water Board

Finance Department Emergency Management Social Services Department Parks & Recreation

Law Department Health Department Veterans Service Agency Transportation

Office of the Environment Human Rights Commission Water Environment Protection

Personnel Department

Planning Agency

Purchase Division COUNTY Of ONONDAGA {1ft,,, a/the J;unes V Maruro (i3owll£Y &/ffVd1(

9.2010

To the Citizens Onondaga County, llonorable Juanne \1. i'dahuney. and Honurablc Members the Onondaga County Legislmure

I am pleased to submit Comprehensive Annual Financial Rep0l1 of Onondaga Countv fur the year ended December 3 L 1.00'1. Responsibility accuracy of data as well m the completeness and fairness of its presentation. including all disclosures, rests with the management of this government. prelvide a reasonable basis for making these representations. County has established a comprdlcnsive set DC inte'rnal controls that i, cksigncd to protect the government's ,lS:ie!S frllm then. or Th.;,s;O controls also allow the County reliable information for the preparation of these financial statements. To the my knowledge and belief. the enclosed dam is accurate in all material respects and is reported in a manner designed tel present fairly t!~c fincl:lciuJ position and results of financial operations the COL;nl\' il, accordance \Vlth accounting policies generally a~~cepted in (J-:(' Slt1te~ i\)] di,;ck,~u!{'~ considered ncc;2:ssary the reader to an unclerstandlng of tIle County's t!n~~Il('i(iI aCH':H!(.'5 h~,\e inclllded.

The Connty has engaged independent auditors who audited the Ilnancial statements. The uf indepcndent audit was to provide reasonable assurance lhat the Ilnflncial statements of the County ar..: of material misstatement The independent audit involved examining. on a test basis. supporting the amounts and dtsclosures in the linancial statements. the m:counting principks and significant estimates by management and evalualir:g the o\'era!l fnancial siatement prcscntlllOl:. The indep

The independent audit of the financial statements \\as pai1'lfa broader. federally r"lanciated .-\;,dit'·. The County is required to undergo an annual andit in conf(wmi:y with provision the Single ;\udit I\U and US. Ornee of :Vlanagemcnt and Budget Circular i\- J Audits of States, Local Gm'emmellts, tlml NOli-Profit Orgallizariolls, The Single Andit Report includes sehedu:c of kdt'rai fimmcial asrllSl.ancc" the independent andilOrs' report on rhe internal c'HIlml structure and compliance with applicable and regulations, and finciings recoml1lendations. The Single Audit Report is r:ot incll1lkd in this C\FR. however, wben available .. it is public record a\ailable to all intereSkd par' upon request.

Gt"'Jlerally accounting principle;:; require managen':ent to pn)vid;:; ~1 ~1arr

:ll Onondaga County is localed in close proxlmlty to the geographic cenler of upstate New York approximately midway belwecn Albany and ButIalo. Onondaga County has a land area of 793.5 square miles and a 2000 U.S. population of 458336. The most municipal entity within the County is the City of which has a :2000 U.S. Census population 147,306 and which also serves as Ihe County seat. The County's population is concentrated along two interstate highway corridors that intersect in the middle of the County. The County's industrial, and to a extent its commercial establishments, are similarly concentrated within the same corridors,

Onondaga County was established in 1794 by an act of the New York State Legislature. The current county executive torm of governmcnt was adopted by voter referendum in I I, County Executive is elected by direct votc for a ternl of four years, The County Exccutive is the executive otTicer of the County with, among other powers, authority to appoint heads of County conditional to confirnmtion, to appoint oftieers as by to the of every department as provided, 10 propose annual operating budget plan, to approve or disapprove every local law or ordinance adopted by the County Legislature, 10 authorize all contracts on behalf of the County, and shall be the chief budget ofticer of the The County LegislatlJre is the policy making, appropriating governing body of Onondaga County, The COUllty ,cgisl'lluJrC is comprised of members from nineteen legislative districts j()r two-year terms, The County Legislature is vested with the power to enact local laws, ordinances and resolutions, to adopt budgets and levy taxes, to override by a two-thirds vote any veto by the County of any legalized to fix compensation for all County officers and employees, and to authorize the of capital debt obligations a two-thirds majority so The offices of County Comptroller, Sherin; District Attorney and County Clerk are elected by direct vote, and each serves a four-year term, The Comptroller is tlle chief accounting and auditing Jur the County and, as such, has major responsibility for the internal financial controls and reporting. The County Clerk is custodian of all legal, property and court documents, Sheriff is the chief law enforcement for the County, In addition to the above officials, the Officer has responsibility for and custody of County monies, administration and sales taxes, and of County Chief Fiscal is appointed by the County Executive, subject to County L"!S"iI'I'

Onondaga County provides a full range of public to residents including public safety, heallh, transportation, education, economic assistance, home and community, culture and recreation, and general administrative support, This report includes all funds and account groups over which Onondaga County exerts substantial control, significant influence and accountability as detlned in the Governnlental Accounting Board (GASB) Statement 14, The P'inancilll Reporting Entity and Statement Determitling Wllether Certain Organizations are Component Unit,f. Based on these Statements, the Onondaga Resource Recovery Agency, the Onondaga County Water Authority, and the Central New Planning Board do not meet to be units of the reporting entity. and accordingly are from this repmt. Predicated on the of these Statements, the On,on,jag:a County Convention Center/War Memorial Management Onondaga Community Onondaga County I ndustrial Development Agency, Friends of Rosamond Gilford Zoo, and the Development meet the requirements for a, component units and accordingly their financial is presented in a discrete I()rnlat in the Financial Section of this reporL The Onondaga Tobacco SccuritizAltion Corporation (0'1' ASC) meets requirements lor recognition as a component unit and their financial information is blended as a Nonmajor Debt Service Fund in the Financial Section this report

Onondaga County Comptroller lV Robert Antonacci II, CPA County maintains a budgetary to ensure with the annual adopted and with other applicable laws. Budgetary control is achieved by usc a pre-encumbrance system that reser:vcs available appropriations prior to the initiation of the contract process. This system the advantage or centraily accounting li)r a County department's expenditure plans prior to actual development of contracts. Upon finalization of contracts, the pre-encumbrance is replaced by an encumbrance. Encumbered amounts do not lapse at year-end, but are re-appropriated into the ensuing year's budget as prescribed by Onondaga County Law. The County Comptroller submits to the I ,egislature a monthly of revenues and expenses compared to budget. Additionally, the Department's Division Management and Budget submits to the Legislatllre a quarterly report of budgetary projections.

Onondaga employs an internal audit that reports to County Comptroller. This internal audit staff conducts periodic financial, operational and compliance audits County deprutments and other rclatcd entities. The internal control structure is subject to evaluation during these internal audits.

Local Economy: The County budget is anected by the condition of the local economy. Expenditures such as public Medicaid, and other human costs vary directly with the condition of the local economy, as do some major County revenues as sales tax.

The local economy supporting County government was in a severe recessionary state during 2009. Uncmployment in the metropolitan statistical area that i.ncludes Onondaga County stood at 8.2% at of 2009. tax collcctions in 2009 from the County retained 10.9% from 2008 collections due to a "hold provision in the sales tax sharing The existing sales tax sharing compels the County to sales tax at the previous year amollnts with surrounding municipalities, schools and the City of Syracuse when there is an actual decline in tax year over year. The sharing agreement expires at the end of201 O.

During 2009 the County realized a decline in sales tax rcvenue from anticipated sales tax revenue of $28 million. A portion of this decline from budget is attributable to the recession and a portion of the decline is at1ributable to a weakening in local gasoline prices. The County lifted a cap on sales tax generated from in 2008. The cap taxed first $2.00 per gallon only. At time of the 2009 budget adoption, local gasoline prices $4.00 gallon. 2009 assumed additional sales tax rcvenuc upon during this lime ne,·jnd

The combined effect sales tax, state budget cuts, and increased human service costs resulting from the recession combined to a budget short full of$31 million during 2009. Significant budget austerity measures were established to help close the gap. These measure combined with federal stimulus revenue and the sale of certain tax liens produced a 2009 surplus of $4 million in the General Fund.

With the eeonomy eontinuing in a severe reeessionary statc with high unemployment. lower sales and reduced interest the formulation of the 20 I 0 budget was affected. The 20 I 0 County budget included a rcduetion of 252 funded positions - including 138 increased property tax levy, institution of a motor vehicle lee, a 911 surcharge increase expected to bring in $1.7 million/year_ and measures to compensate for the economic conditions the budget The 20 I 0 budget supports $1,164,387,143 in total expenditures, including internal transfers of $199,448.976. were 2.3% below the 2009 budget as modified ilnd $7.9 million of General Fund reserves were applied to balance the budget

Onondaga County Comptroller v Robert E. Antonacci II, The County's diverse economic hase continues to playa key role in the impact of the recession. Our regional banks are not the issues currently large multinational financial institutions. The local real estate market has been stable since 2005 in conll1ercial, industrial and residential sectors. Onondaga County is the hub of a regional medical sector that is a major economic driver, and is also part of a larger educational region with more than 30 and universities, 130,000 students and approximately $ 1.2 bi Ilion in annual R&D expenditures at the largest institutions. The "\few York State Center of Excellence in and Environmental Technologies. a collaborative venture h,,'uu',m the State, Syracuse University, SU'JY's College of Environmental Science and Forestry, and private business, opened in "v1arch of lO, This $35,6 million, high profile, downtown development will academic and corporate research and the development of relating to clean and renewable indoor environmental and water resources. The project is the product of a Jederalion of 140 businesses, and research instillllie.ns.

,. """".. ,,,., Planning: Each County prepares a Capital Improvement Plan (C1P). CIP process is both a probrrammatic and fiscal tool, providing an opportunity for decision- 111""\;:1' to regularly evaluate infrastmetufe needs and competing capital investments within a fiscal framework that includes debt serviee projections and future operating costs. The current capital plan outlines $783 million in projects wim most of the resources targeted to new associated with the court-mandated clean up of Onondaga

The County has established debt policies that the parameters for the capital planning process. The policies are included in the County's operating budget document and authorized annually by the County as part of the budget process. The debt policies call for General Fund debt '~'''.r'~ to remain below 5% of General Fund revenue: for overall net direct to remain below $500 per capita, or 1% of the full value of property; and to maintain a schedule in which 65% or more oflhe outstanding debt retired within ten years,

In addition County Legislature has a General Fund policy that establishes a fund balanec goal of 10% net revenues and calls IDr amounts in excess of 10% to be applied to avoid future debt or for tax relief. revenues are calculated as gross revenues sales tax pa~s through revenue budgeted for municipalities,

To aid the t1nancial planning process, the County's Division of Management and Budget prepares and presents quarterly budget forecasts to the Executive and Legislature. and maintains and updates a mid-term (two year) and long-term (flve year) budget forecast

Onondaga Lake. Onondaga County entered into an Amended Consent Judgment (AC]) in 1998 that established a plan to reduce sewage outflows into Lake through specific improvements 10 Ihc "v1etropolitan Plant sewer costs are currently at millioll. The project is supported through a combinatioll of state and federal by local user fees. The appropriated $74,9 million of Clean Water/Clean Environmental Bond Act funds for projects covered under the AC], In addition to aid through the Environmental Bond Act, based on pledges by Siale officials, the County also planned on receiving approximately $85 million in supplemental funding over the 15 year projeet as initially scheduled in the 1998 ACJ. oj'the $85 million in pledged funding, $50 million has been appropriated from other New York State sources; an additional $10 million is being processed through the 2007·0S budget, and another $10 million in each of the State's 2008-09 and 2009-J 0 budgets. An additional $5 million is being processed through the 2011 budget. The federal has already appropriated $120.1

Onondaga County Comptroller Vl Robert E. Antonacci ll, million in foderal funds (inclusive of assistance from the U,S, Anny Corps of Engineers), Short-tenn funding of $20 million f()r the Harbor Brook Project is extended under the ARRA program and this projcct is eligible for up to 50% loan forgiveness, Local costs Ihal are not eligible for financing through the Environmental Corporation will be supported through County Obligation debt. Both Erc and General Obligation County debt associated with project arc paid by property ov,ncrs within the Sanitary through uscr

In the event that the ACJ projects do not bring the County in compliance with applicable water quality standards, the County will be required to undertake additional measures, Additional information regarding this commitment can be found in Note 15 to the financial statements,

Cash management. New York State Law directs which type of investments its counties may use to invest idle cash. Those types of investments an: more fully described in Note 3 to the financial statemems. Income as a result oflhese investments was I in 2009.

Risk management. Onondaga County 1S self-insured for liability, employee health hFlnF\l! unemployment, workers' compensation, and vehicle related losses. The County utilizes an internal service fund to account for its self-insurance activities. The County purchases insurance tor property The County employs loss control and salety specialists and also conducts a of worker sal(,ty programs. Additional infonllation on the County's risk management activities can found in Note !3 to the financial statements.

Retirement and other postempioyment benefits. The County in the New York and Employees' (ERS). provides benefits as well as and disability benetlts, Obligations of employers employees to contribute benefits to employees are governed by the New York Retirement and Security Law (NYSRSSL), As sct fm1h the NYSRSSL, the Comptroller of the State of New York (Comptroller) serves as sole trustee and administrative head of the ERS. The ERS is noncontributory except lor employees who joined the ERS after .July 1976, contribute 3% of their salary. After ten of service, the ERS becomes noncontributory for employees as well. Under the authority of NYSRSSL, the State Comptroller shall annually rates expressed as of payroll which shall be in co:mpluti:ng the contributions required to be to accumulation fund.

In addition to providing pension beneHls, the County provides certain health insurance benefits to retired employees and survivors under its self-insured health program. Substantially all of the County's employees may become eligible for these benefits if they reach normal retirement while working tor the County, As of the end of the year, there were 2,745 retirees receiving these bene!i!s. In 2007, the County adopted Governmental Accounting Board Statement No. 45, Accounting lind Financial Reporting by Employer,v for Postemployment Benefits Other Titan Pensions, on a basis. This statemem municipalities to amortizing the aCluarially liability for providing h",.",tjk to The County will recognize this liability over a thirty-year period.

Additional inlonnation on the County's retirement and postemployment bencHls can be found in Note 10 to the linancial statements.

Onondaga County Comptroller VII Robert Antonacci II, CPA This Comprehensive Annual Financial Report could not have been completed without the dedication and teamwork of my entire stan: I would like to express my appreciation to my starf and thank them for a job well donc.

I also wish to thank the County Executive, the Chief Fiscal Officer, and the County Legislature for their leadership and support of efforts to improve the financial operations of Onondaga County.

Sincerely, t!!L~--

Onondaga County Comptroller VBi Robert E. Antonacci II, CPA

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FINANCIAL

SECTION

[!]-

TESTONE MARSHALL D I S CENZ,\ C PAS

I1I::L~INC:: OUI'! CLII'.: NTS· Via l ON» .0. 00 U P INDEPENDENT AUDITOR'S REPORT

The Honorable County Executive, Joanne M. Mahoney and Honorable Members of the County Legislature County of Onondaga, New York

We have audited the accompanying financial statements of the governmental activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the County of Onondaga, New York (the County) as of and for the year ended December 31 , 2009, which collectively comprise the County's basic financial statements as listed in the table of contents. These financial statements are the responsibility of the County's management. Our responsibility is to express opinions on these financial statements based on our audit. We did not audit the financial statements of Onondaga County Community College, Onondaga COWlty Industrial Development Agency, and Friends of the Rosamond Gifford Zoo, which together represent 97% and 88%, respectively, of the assets and revenues of the aggregate discretely, presented component units. Those financial statements were audited by other auditors whose reports thereon have been furnished to us, and our opinion, insofar as it relates to the amounts included for Onondaga County Community College, Onondaga County Industrial Development Agency, and Friends of the Rosamond Gifford Zoo is based solely upon the reports of the other auditors.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Governmenl Audiling Standards, issued by the Comptroller General of the United Slates. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. However, the financial statements of Friends of the Rosamond Gifford Zoo were not audited in accordance with Government Auditing Standards and, accordingly, are not covered by our report in accordance with Government Auditing Standards. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit and the reports of other auditors provide a reasonable basis for our opinions.

In our opinion, based on our audit and the reports of the other auditors, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the aggregate discretely presented component units, each major fund, and the

IX aggregate remaining fund information of the County of Onondaga, New York as of December 31, 2009, the respective changes in financial position and cash flows, where applicable, for the ycar then in conformity ,,;th accounting principles generally in the United States of America,

In accordance with Government Auditing Standards, we have issued a report dated April 9, 2010 on our consideration of the County's internal control over reporting and on our tests its compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters. The purpose of that report is to describe the scope of our teSling 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 considered in assessing results of our audit.

Accounting principles generally accepted 111 the United States of America require that the management's discussion and analysis and comparison infonnation on through xxii and 42 through 44 presented to the basic statements, information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part financial reporting for placing financial statements in an operational, economic, or historical context. We applied certain limited procedures to required supplementary informalion in accordance with auditing standards generally accepted in the United of America, which consisted of inquiries management about methods of preparing the intormation and comparing infonnation for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtain during our audit of the basic financial statements, do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or assurance,

Our audit was conducted tor the purpose fonning opinions on the financial statements that collectively comprise County's financial statements, The introductory section, combining and individual nonm",jor fund financial statements, and statistical section are presented for purposes of additional analysis and are not required part of the financial statements, The combining and individual nonmajor financial statements are the responsibility of management and were derived from and directly to the underlying accounting records used to the financial statements. The intormation has becn subjected to the auditing procedures applied in the audit of the financial statements and additional procedures, including comparing and reconciling such infonnation directly to underlying accounting and other records used to prepare financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America, III our opinion, the information is fairly stated in material respects in relation to financial statements as a whole. The introductory and statistical sections not been subjected to the auditing applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or providc any assurance on them. 0Y~ ~UC;.O~,ur April 9,2010 -V' Syracuse, New York COUNTY OF ONONDAGA, NEW YORK Management's Discussion and Analysis

As management of Onondaga County, we offer readers of the County's financial statements this narrative overview and analysis of the financial activities of the County for the fiscal year ended December 31, 2009. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal, which can be found beginning on page iii of this report.

Financial Highlights

• The assets of Onondaga County exceeded its liabilities at the close of the most recent fiscal year by $730,361,216 (net assets). • The government's total net assets decreased by $48,101,812, mainly due to increased postemployment benefits of $37,525,000 and other long-term debt. • As of the close of the current fiscal year, Onondaga County's governmental funds reported combined ending fund balances of $198,622,757, an increase of $15,557,370 in comparison with the prior year. The increase is attributed mainly to the sale of future property tax receivables of $13,086,088. • At the end of the current fiscal year, total fund balance for the general fund was $74,665,938, or 9.9% of total budgetary basis general fund revenues. • Onondaga County's governmental activities long-term liabilities increased by $80,915,494 or 14.1%, during the current fiscal year.

Overview of the Financial Statements

This discussion and analysis is intended to serve as an introduction to the County's basic financial statements. The County's basic financial statements comprise three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the 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 County's finances, in a manner similar to a private- sector business.

The statement of net assets presents information on all of the County'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 County is improving or deteriorating.

The statement of activities presents information showing how the County’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 compensated absences.

xi COUNTY OF ONONDAGA, NEW YORK Management's Discussion and Analysis

The governmental activities of the County include general government support, education, public safety, health, transportation, economic assistance and opportunity, home and community services, and culture and recreation.

The government-wide financial statements include the County as the primary government, and Onondaga Community College, ONCENTER Management Corporation, Onondaga County Housing Development Fund Company, Friends of Rosamond Gifford Zoo, and Onondaga County Industrial Development Agency as component units for which the County is financially accountable. Financial information for these component units is reported separately from the financial information presented for the primary government itself. The Onondaga Tobacco Asset Securitization Corporation (OTASC), although also legally separate, functions for all practical purposes as a department of the County, and therefore has been included as an integral part of the primary government.

The government-wide financial statements can be found on pages 1-4 of this report.

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 County, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the County can be divided into three categories: governmental funds, internal service 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 short- 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 government's short-term financing requirements.

Onondaga County maintains thirteen 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, the debt service fund, water environment protection and the capital projects fund, all of which are considered to be major funds. Data from the other nine 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 County adopts an annual appropriated budget for its governmental funds, with the exception of the Capital Projects Fund. A budgetary comparison statement has been provided for these funds to demonstrate compliance with this budget.

The basic governmental fund financial statements can be found on pages 5-9 of this report.

Internal Service funds. Internal service funds are an accounting device used to accumulate and allocate costs internally among the County's various functions. The County uses an internal service fund to account for its risk management activities. Because these services predominantly benefit

xi i COUNTY OF ONONDAGA, NEW YORK Management's Discussion and Analysis

governmental rather than business-type functions, the internal service fund has been included within governmental activities in the government-wide financial statements.

The basic internal service fund financial statements can be found on pages 10-12 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 County's own programs. The accounting used for fiduciary funds is much like that used for governmental funds.

The basic fiduciary fund financial statements can be found on page 13 of this report.

Component Units. As discussed above, component units are legally separate entities for which the County is financially accountable. The component units addressed above, excluding OTASC, are reported in aggregate in the government-wide financial statements.

The combining statements for the component units can be found on pages 14-17.

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

Other information. In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning the budget and actual schedules for the major governmental funds and funding progress for postemployment benefits. These required schedules and notes to the schedules can be found on pages 42-45.

Combining statements for nonmajor governmental funds are presented immediately following the required supplementary information on pages 46-49 of this report.

Government-wide Financial Analysis

As noted earlier, net assets may serve over time as a useful indicator of a government’s financial position. In the case of the County, assets exceeded liabilities by $730,361,216 at the close of the 2009 fiscal year.

The portion of the County’s net assets represented by its investment in capital assets, e.g., land, buildings, and equipment, less any related debt used to acquire those assets that is still outstanding is $836,275,910. The County uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending.

Although the County’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, as the capital assets themselves cannot be used to liquidate these liabilities.

The portion of the County’s net assets that represents resources that are subject to external restrictions on how they may be used is $22,730,632. The remaining ($128,645,326) is unrestricted net deficit.

xiii COUNTY OF ONONDAGA, NEW YORK Management's Discussion and Analysis

County of Onondaga’s Net Assets

Governmental activities 2008 2009 Current and other assets $ 377,344, 566 $ 378,311,308 Capital assets 1,140,398,327 1,163,927,492 Total assets 1,517,742,893 1,542,238,800

Long-term liabilities 573,771, 272 651,023,992 Other liabilities 165,508, 593 160,853,592 Total liabilities 739,279, 865 811,877,584 Net assets: Invested in capital assets, net of related debt 852,007, 509 836,275,910 Restricted 19,823, 048 22,730,632 Unrestricted (93,367,529) (128,645,326) Total net assets $ 778,463, 028 $ 730,361,216

The County’s net assets decreased by $48,101,812. In 2007, the County adopted Governmental Accounting Standards Board Statement No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions (OPEB). This statement requires municipalities to begin recognizing an actuarial determined liability for benefits provided to retirees. The liability will be amortized into the County’s entitywide operations over a period of 30 years. The amount recorded in 2009 is $37,525,000. Additional information on the OPEB liability can be found in Note 10.

xi v COUNTY OF ONONDAGA, NEW YORK Management's Discussion and Analysis

County of Onondaga's Changes in Net Assets

Governmental activities Revenues: 2008 2009 Program revenues: Charges for services $ 1 97,066,748 $ 18 0,621,469 Operating grants and contributions 1 99,017,801 21 5,666,695 Capital grants and contributions 19, 934,877 1 1,398,419 General revenues: Property taxes 1 89,794,554 17 8,297,034 Other taxes 3 00,164,040 28 4,918,896 Sale of Receivables - 1 3,086,088 Other 16, 406,496 1 1,477,130 Total revenues 9 22,384,516 89 5,465,731

Expenses: General government support 2 18,159,741 22 7,253,928 Education 56, 115,210 5 7,018,115 Public safety 1 31,896,522 12 5,871,517 Health 1 05,762,977 9 9,108,590 Transportation 42, 074,051 3 7,885,081 Economic assistance and opportunity 2 62,786,203 25 3,764,840 Culture and recreation 47, 748,717 3 4,638,419 Home and community services 75, 444,171 8 9,332,420 Interest on long-term debt 18, 174,279 1 8,694,633 Total expenses 958,161,871 943,567,543

Increase (decrease) in net assets (35,777,355) (48,101,812) Net assets - Beginning 8 14,240,383 77 8,463,028 Net assets - Ending $ 778,463,028 $ 73 0,361,216

Governmental activities. Governmental activities decreased the County’s net assets by $48,101,812, thereby accounting for a 6.2% decrease in the net assets. The key element of this decrease was the accrual of $37.5 million in postemployment retirement benefits.

xv COUNTY OF ONONDAGA, NEW YORK Management's Discussion and Analysis

Financial Analysis of the Government’s Funds

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

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

The general fund is the chief operating fund of the County. At the end of the current fiscal year, unreserved fund balance of the general fund was $69,373,888 while total fund balance reached $74,665,938. 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 fund balance represents 9.2% of total budgetary basis general fund expenditures, while total fund balance represents 9.9% of that same amount.

The general fund’s fund balance increased by $3,953,337 during the current fiscal year. The current recession has had a major impact on County sales tax revenue. In 2009, sales tax revenue came in $34.2 million less than budget. That short fall coupled with a planned deficit of $3.7 million in appropriated fund balance left the General Fund in deficit by nearly $38 million. Tight controls on expenses and the sale of accounts receivables, further discussed in Note 5, directly contributed to the surplus at year-end.

Water Environment Protection appropriated approximately $5.0 million in prior years fund balance into 2009 operations. Expenditures finished $4.9 million under budget and revenue of $1.8 million from the sale of receivables mentioned above, offset approximately $3.8 million of appropriated fund balance resulting in an operating deficit of $1,222,767.

The County’s 2009 Debt Service Fund budget authorized an appropriation of $1.6 million from reserve for bonded debt. Due to unbudgeted revenue of $1.0 million from interest, $3.9 million from bond premium, and $2.0 million from unused project balances, the County offset that appropriation and reported a $5,615,703 operating surplus.

xvi COUNTY OF ONONDAGA, NEW YORK Management's Discussion and Analysis

County Revenues Governmental Funds

Intergovernmental Other Charges 4% 6%

Real Property Taxes Departmental Income 21% 12%

St at e Aid 13%

Non Property Tax Items 32% Federal Aid 12%

County Expenditures Governmental Funds

Debt Service 5% Home and Community General Government 10% 21% Culture and Recreation 3%

Education 6%

Economic Assistance 26% Public Safety 14%

Transportation Health 5% 10%

xvi i COUNTY OF ONONDAGA, NEW YORK Management's Discussion and Analysis

Internal Service Funds. Unrestricted net assets of the Internal Service Fund decreased by $431,511 decreasing net assets to $8,600,846. This loss can be attributed to crediting back prior surpluses to County departments. As stated earlier, the activity of the Internal Service Fund predominantly benefits the primary government. It has been included within governmental activities in the government-wide financial statements.

General Fund Budgetary Highlights

Appropriations: $3.3 million increase in appropriations can be summarized as follows: • $4.8 million decrease in the provision for salary and wage adjustment account to reflect transfers to other departments, the county road and library fund for salary adjustments related to 2008 and 2009. • $3.4 million increase in salary accounts to reflect 2009 budget amendments made in late 2008 to reflect salary and wage adjustments for CSEA and the M/C group retroactive back to 2008 and including 2009. • $2.0 million increase is the carryover of encumbrances from 2008 to 2009. • $1.9 million increase in the employee benefit accounts to reflect the increased costs of labor agreements related to 2008 and 2009. • $0.7 million increase in overtime accounts to reflect increased costs in the Justice Center and DSS Child Protective Division.

Revenues: $1.4 million increase in the revenue budget can be summarized as follows: • $1.3 million increase in the appropriation of federal, state and other reimbursements relating to 2008-09 salary settlements late in 2008.

Capital Asset and Debt Administration Capital assets. The County’s investment in capital assets for its governmental activities as of December 31, 2009 amounts to $1,163,927,492 (net of accumulated depreciation). This investment in capital assets includes construction in progress, land, buildings, improvements, equipment, park facilities, roads, highways, drainage and sewage treatment, and bridges.

County of Onondaga's Capital Assets (net of depreciation)

Governmental activities

2008 2009 Land $ 17,927,717 $ 18,316,300 Land Improvements 6,777,934 6,703,538 Building and Improvements 213,142,611 209,327,366 Equipment 39,249,135 51,834,420 Infrastructure 610,614,598 606,037,732 Construction in progress 252,686,332 271,708,136 Total $ 1,140,398,327 $ 1,163,927,492

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

xv iii COUNTY OF ONONDAGA, NEW YORK Management's Discussion and Analysis

A number of capital projects were completed during the year. These include $13.9 million in projects associated with ACJ for Onondaga Lake and $9.5 million for road improvements reducing the construction in progress account and increasing infrastructure. In addition, the County added over $50.7 million to the construction in progress account including $18.1 million in highway improvements and $21.9 million associated with Water Environment Protection and ACJ Projects. Additional information on the County’s capital assets can be found in Note 7 to the financial statements.

Long-term debt. At the end of the current fiscal year, the County had total bonded debt outstanding of $342,733,075 and loans payable of $145,572,734. This debt increased by $37,505,589 during the current fiscal year.

Activities 2008 2009 Serial bonds $ 1 64,447,335 $ 208,835,500 OTASC Tobacco settlement bonds 1 37,607,755 133,897,575 Loans 1 48,745,130 145,572,734 Total $ 450,800,220 $ 488,305,809

Additional information on the County’s debt can be found in Note 8 to the financial statements.

The County maintains a “AA+” rating from Standard & Poor’s and Fitch and a “Aa2” rating from Moody’s for general obligation debt.

State statutes limit the amount of general obligation debt a governmental entity may issue to 7% of its five-year average full valuation of taxable real property. The County has utilized 10.49% of its statutory debt limit at December 31, 2009.

Economic Factors and Next Year’s Budgets and Rates

According to the New York State Department of Labor, Onondaga County’s unemployment rate in 2009 averaged 7.7%; lower than the statewide average of 8.4%. The yearly average is fairly consistent with monthly unemployment statistics and is reflective of a sustained economic downturn.

Although in the midst of a severe recession, Onondaga County has a diversified economy, which enables it to weather the economic storm that much of the country is experiencing. Employment diversity in manufacturing, health, education and government sectors has traditionally kept unemployment levels below the State and the nation. The County’s geographic location in the middle of the State and its excellent transportation infrastructure – roads, rail, airport facilities - contribute to its vibrancy. The County’s economy is not highly dependent on financial sectors and the regional banks in the County are not experiencing the same issues facing other financial institutions. The housing market did not rise or fall with the housing bubble. In its third quarter 2009 MetroMonitor report, the Brookings Institute ranked the Syracuse Metro area fourth out of the largest 100 metropolitan areas in terms of growth in the real housing price index (an inflation adjusted measure of the increase in housing prices). The Syracuse area grew 4.3% as measured by the index between the third quarter 2008 and the third quarter 2009. In the same Brookings Institute report, the Syracuse

xi x COUNTY OF ONONDAGA, NEW YORK Management's Discussion and Analysis

Metro area was ranked 17th out of 100 of the largest metropolitan areas relative to economic performance during the current recession. The report averages rankings in the following areas: changes in employment, unemployment rate, gross metropolitan product (GMP) and housing prices over the course of the recession to derive an overall performance index. Since Upstate New York typically lags behind, both in good times and bad, the ultimate impact of the recession will be dependent on its length.

Three strong economic sectors that position the region for the future include:

Bio, Medical Devices and Life Sciences – As the baby boomer generation continues to age, this sector will continue to be robust. Companies in this sector include: Acrolite, Bristol-Myers Squibb, Design Prototyping Technologies, InfiMed, Seneca Data, Tessy Plastics and Welch Allyn. Regionally this sector is supported by the Cornell Center for Advanced Technology for Life Sciences, which is the largest R&D initiative in the history of that university.

Radar, Sensor, Wireless and other Electronic Devices – This sector has high economic impact with supply chains of very high value. Companies in this sector include: Anaren Microwave, Eagle Comtronics, Lockheed- Martin, Sensis Corporation and Syracuse Research Corporation. The CASE Center at Syracuse University helps support this sector.

Renewable Energy and Environmental Systems – The cultural and economic shifts to renewable energy and sustainability will continue to enhance the region’s status as a leader in this sector. There is ample R&D capacity in this sector and colleges and universities with core competencies including SUNY ESF, Morrisville State College, Syracuse University, Cornell University and Clarkson University are helping to develop technologies in areas such as: cellulosic ethanol, biodiesel from oilseed and biomass, energy efficient services, green construction contracting, LEED buildings, solar PV and solar thermal insulation, fuel cells, small wind turbines, tidal turbines, anaerobic digesters, geothermal energy, co-generation and combined heat/power generation using alternative energy sources and alternate fuel sources from hydrogen, butanol and algae. The New York State Center of Excellence in Energy and Environmental Technologies opened in March 2010. A collaborative venture between the State, Syracuse University, SUNY’s College of Environmental Science and Forestry, and private business, this $35.6 million, high profile, downtown development will focus academic and corporate research and the development of innovations relating to clean and renewable energy, indoor environmental quality, and water resources. The project is the product of a federation of more than 140 businesses, organizations, and educational and research institutions. Companies in this sector include: Carrier Corporation, C&S Companies, O’Brien and Gere and Pall Trinity Micro. Regional assets such as the Syracuse Center of Excellence support this sector.

The County Executive presented the 2010 budget in September 2009. With the economy continuing in a severe recessionary state with high unemployment, lower retail sales and reduced interest rates, the formulation of the 2010 budget was affected. The primary impact of the State’s 2009-10 budget on the County’s 2010 budget was a decrease of $11.6 million State aid, primarily affecting the County’s Van Duyn Nursing Home. The Federal stimulus bill (ARRA) provided relief of approximately $13.7 million in the form of increased Federal Medicaid (FMAP). The 2010 County budget included a reduction of 252 funded positions – including 138 layoffs, increased property tax levy, institution of a motor vehicle fee, a 911 surcharge increase expected to bring in $1.7 million/year, and other measures to compensate for the deteriorating economic conditions affecting the budget.

xx COUNTY OF ONONDAGA, NEW YORK Management's Discussion and Analysis

The County Legislature adopted the 2010 Budget as amended on October 13, 2009. The 2010 Budget supports $1,164,387,143 in total expenditures, including internal transfers of $199,448,976. Expenses were 2.3% below the 2009 budget as modified. The General Fund budget included an adopted property tax levy of $183,997,042, an increase of 4,175,656, or +2.3% vs. 2009. The 2010 budget applied $7.9 million of General Fund reserves.

Consumption based user fees were increased 2.49% in the Water Environment Protection Department (Sanitary District Fund) in 2010. Wholesale water rates charged by the Metropolitan Water Board (Water Fund) remained flat in 2010.

Other Potentially Significant Matters

The County owns and operates Van Duyn Home and Hospital, a 513-bed nursing home.

In November 2006, the State's Commission on Health Care Facilities for the 21st Century (the Berger Commission) recommended that Van Duyn be privatized and merged with neighboring Community General Hospital (CGH). Van Duyn and CGH proposed a plan (Scenario A) to New York State Department of Health to satisfy the Berger Commission recommendations in July 2007, which included formation of a joint planning organization, reduction of 63 nursing home beds and required that funds be made available to facilitate these changes. The New York State Department of Health awarded $12.8 million in HEAL NY 4 grant funds to CGH and Van Duyn, of which $3.2 million is to be spent on improvements to Van Duyn. Van Duyn and CGH have embarked upon operational and infrastructure studies as outlined in “Scenario A”. Van Duyn has further committed to spending the remaining grant funds on capital improvements, including a boiler replacement project.

In 2009, the Onondaga County Legislature authorized Van Duyn to move forward with other needed capital improvements, including elevator modernization, fire alarm replacement, nurse call system replacement, telephone system replacement and other projects such as security cameras, ice machines, oil tank replacement, freezers and coolers. These projects should be substantially complete in 2010, with the exception of two of the eight replacement elevators which should be complete in the first quarter 2011.

For the past several years the facility has experienced operating deficits of several million dollars per year (exclusive of IGT payments). In 2006 the New York State Legislature enacted a new Medicaid reimbursement methodology (rebasing) that was to be fully implemented by January 1, 2009 as well as the Public Facilities Grant program that was proposed to make Van Duyn break-even by 2010. The Public Facilities Grant program lasted only two years and was completely eliminated in 2008. The 2009-2010 Adopted New York State Budget eliminated the new rebasing Medicaid reimbursement methodology after one year of implementation and replaced it with a regional rate of reimbursement effective April 1, 2010. The Governor’s Proposed 2010-2011 Budget delays regional pricing until March 1, 2011, eliminates the 2010 trend factor and increases nursing home assessments from 6 percent to 7 percent. The net effect of these proposals would cause the increase of approximately $3 million in Medicaid reimbursement to Van Duyn in the County's 2010 fiscal year (compared to the current reimbursement rate). The last estimate received from Van Duyn’s State Association shows the negative impact of the regional rate implementation to be not as severe as previously projected; until further details are worked out, it is impossible to predict with any accuracy the effect of the Medicaid regional pricing implementation.

xxi COUNTY OF ONONDAGA, NEW YORK Management's Discussion and Analysis

In 2008 the County was allowed to apply retroactively to 2006 for Intergovernmental Transfer Revenue, which resulted in approximately $13.4 million additional aid to Van Duyn in 2009 and 2010. Should the Governor’s budget proposal pass, and the rebased rates continue through 2010, there would be some additional cushion for 2010 and into 2011. A study was conducted in 2009 by an outside consulting firm to provide the County with options for the future of Van Duyn. Due to the uncertainty at the Federal and State levels regarding reimbursement rates, there was no conclusive determination made.

Requests for Information

This financial report is designed to provide a general overview of the County of Onondaga’s finances for all those with an interest in the government’s finances. Questions concerning any information provided in this report or requests for additional financial information should be addressed to the Comptroller’s Office, 14th Floor Civic Center, 421 Montgomery Street, Syracuse, New York, 13202.

xxi i

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BASIC FINANCIAL STATEMENTS

COUNTY OF ONONDAGA, NEW YORK Statement of Net Assets December 31, 2009

Governmental Component Activities Units ASSETS Cash and investments $ 158,711,134 $ 20,709,113 Deposits by contractors 1,695,000 - Receivables: Property taxes (net of $16,791,283 reserve) 28,625,100 - Accounts receivable (net of $4,768,529 reserve) 73,790,272 16,682,775 Due from state and federal governments 95,417,127 1,944,028 Due from other governments 6,553,247 - Inventories 6,287,659 1,640,800 Prepaid items and other assets 3,988,783 220,942 Deferred charges 3,242,986 - Notes receivable - 61,308 Lease receivable - 37,851 Endowment assets: Investments - 1,863,881 Promises to give - 23,892 Capital assets net of accumulated depreciation 1,163,927,492 79,524,410 Total assets 1,542,238,800 122,709,000

See notes to financial statements. 1 COUNTY OF ONONDAGA, NEW YORK Statement of Net Assets December 31, 2009

Governmental Component Activities Units LIABILITIES Accounts payable 17,619,988 5,277,222 Accrued liabilities 54,592,959 3,498,893 Contracts payable - retainage 3,105,695 - Other liabilities 20,710 1,225,574 Due to other governments 72,260,027 - Due to Onondaga County - 2,718,126 Other deferred revenue 13,254,213 20,853,001 Long term obligations and unpaid liabilities: Due within one year 46,879,170 987,463 Due in more than one year 604,144,822 58,641,385 Total liabilities 811,877,584 93,201,664

NET ASSETS Invested in capital assets, net of related debt 836,275,910 34,739,746 Restricted for: Capital projects 4,247,149 3,229,619 Debt service 18,483,483 - Endowments - 2,072,223 Loans - 16,765 Unrestricted (128,645,326) (10,551,017) Total net assets $ 730,361,216 $ 29,507,336

2 COUNTY OF ONONDAGA, NEW YORK Statement of Activities Year Ended December 31, 2009

Program Revenues Indirect Expenses Charges for Expenses Allocation Services Functions/Programs Primary government: Governmental activities: General government support $ 227,253,928 $ (8,321,291) $ 27,124,654 Education 57,018,115 - 440,000 Public safety 125,871,517 1,759,340 12,788,242 Health 99,108,590 2,033,040 48,737,916 Transportation 37,885,081 637,211 3,838,244 Economic assistance and opportunity 253,764,840 1,952,732 4,877,805 Culture and recreation 34,638,419 750,278 10,147,975 Home and community services 89,332,420 1,188,690 72,666,633 Interest on long-term debt 18,694,633 - - Total primary government $ 943,567,543 $ - $ 180,621,469

Component units: Community College $ 88,502,415 $ 21,619,020 ONCENTER 11,542,786 9,363,842 Housing Development Fund Company 2,003,820 1,203,402 Friends of Rosamond Gifford Zoo 2,054,616 1,794,378 OCIDA 8,287,312 7,809,821 Total component units $ 112,390,949 $ 41,790,463

See notes to financial statements. 3 Net (Expense) Revenue and Changes Program Revenues in Net Assets Operating Capital Grants and Grants and Governmental Contributions Contributions Activities Component Units

$ 2,716,659 $ 1,918,899 $ (203,815,007) $ - 21,466,871 2,786,995 (32,324,249) - 6,262,665 2,947,218 (102,114,052) - 46,043,305 6,260 (2,288,069) - 4,483,484 2,535,751 (26,390,391) - 124,668,546 - (122,265,757) - 2,725,605 214,502 (20,800,059) - 7,299,560 988,794 (7,188,743) - - - (18,694,633) - $ 215,666,695 $ 11,398,419 (535,880,960) -

$ 28,225,020 $ 1,038,091 - (37,620,284) - - - (2,178,944) 520,000 - - (280,418) 406,411 - - 146,173 - - - (477,491) $ 29,151,431 $ 1,038,091 - (40,410,964)

General revenues: Real property taxes and tax items 178,297,034 - Sales tax and use tax 284,918,896 - Investment earnings 3,385,671 1,833,273 Tobacco settlement proceeds 7,806,998 - Participation in debt service-external sources 284,461 - Sale of receivables 13,086,088 - Contributions other - 22,299,905 Other revenue - 3,500 County contributions - 10,694,000 Total general revenues and transfers 487,779,148 34,830,678 Change in net assets (48,101,812) (5,580,286) Net assets-beginning 778,463,028 35,087,622 Net assets-ending $ 730,361,216 $ 29,507,336

4 COUNTY OF ONONDAGA, NEW YORK Balance Sheet Governmental Funds December 31, 2009

Water Environment General Protection ASSETS Cash and investments $ 29,452,648 $ 34,845,787 Deposits by contractors -- Receivables: Property taxes (net of $16,791,283 reserve) 28,625,100 - Accounts receivable (net of $4,768,529 reserve) 53,361,555 9,348,046 Due from state and federal governments 70,360,821 - Due from other funds 3,702,536 - Due from other governments 3,771,489 1,366 Inventories -- Prepaid items 2,939,410 345,338 Restricted assets -- Total assets $ 192,213,559 $ 44,540,537

LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ 7,651,316 $ 1,407,921 Accrued liabilities 29,091,966 1,618,006 Due to third party payors - - Contracts payable-retainage 15,241 1,110 Other liabilities 256 - Due to other funds 1,900,000 - Due to other governments 71,031,359 - Deferred property tax revenues 6,924,913 - Other deferred revenues 932,570 2,297,023 Total liabilities 117,547,621 5,324,060

Fund balances: Reserved for: Prepaids 2,939,410 345,338 Debt service -- Encumbrances 2,352,640 1,426,235 Capital improvements - - Unreserved: Designated 8,759,703 34,684,425 Undesignated 60,614,185 2,760,479 Undesignated, reported in nonmajor: Special revenue funds - - Debt service funds -- Total fund balances 74,665,938 39,216,477 Total liabilities and fund balances $ 192,213,559 $ 44,540,537

See notes to financial statements. 5 Other Total Debt Capital Projects Governmental Governmental Service Fund Funds Funds

$ 41,669,268 $ 17,222,385 $ 15,394,986 $ 138,585,074 - 1,695,000 - 1,695,000

- - - 28,625,100 54,553 12,958 8,097,034 70,874,146 - 11,301,291 11,159,050 92,821,162 - - 1,900,000 5,602,536 - 277 1,403,159 5,176,291 - - 171,639 171,639 - - 704,035 3,988,783 - - 350,568 350,568 $ 41,723,821 $ 30,231,911 $ 39,180,471 $ 347,890,299

$ - $ 2,906,674 $ 3,267,234 $ 15,233,145 - 4,362,127 2,963,184 38,035,283 - - 301,093 301,093 - 3,077,966 11,378 3,105,695 - - 20,454 20,710 - - 3,702,536 5,602,536 - - 927,575 71,958,934 - - - 6,924,913 - 3,412,955 1,442,685 8,085,233 - 13,759,722 12,636,139 149,267,542

- - 704,035 3,988,783 41,723,821 - 8,618,637 50,342,458 - 42,071,983 4,920,549 50,771,407 - 144,697 - 144,697

- - 6,345,108 49,789,236 - (25,744,491) - 37,630,173

- - 5,865,445 5,865,445 - - 90,558 90,558 41,723,821 16,472,189 26,544,332 198,622,757 $ 41,723,821 $ 30,231,911 $ 39,180,471

Amounts reported for governmental activities in the statement of net assets are different because: Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds. 1,163,927,492 Long-term receivables not reported in the funds 3,972,921 Inventories of automotive parts and road materials expensed as acquired in the funds. 6,116,020 Internal service fund used by management to charge the costs of insurance activities to individual funds. The assets and liabilities of the internal service fund are included in governmental activities in the statement of net assets. 8,600,846 Deferred revenue including property taxes not available to pay for current-period expenditures and are therefore, deferred in the funds. 9,269,739 Deferred gain on defeased debt not reported in the funds. (1,563,403) Debt issuance costs expensed as incurred in the funds. 2,313,515 Accrued interest not reported in the funds. (4,853,747) Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported in the funds. (656,044,924) Net assets of governmental activities $ 730,361,216

6 COUNTY OF ONONDAGA, NEW YORK Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds For the Year Ended December 31, 2009

Water Environment General Protection REVENUES Taxes: Real property taxes and tax items $ 183,094,220 $ 2,009,975 Sales tax and use tax 284,398,541 - Federal aid 81,000,925 - State aid 91,052,381 - Departmental 27,186,470 59,156,791 Service for other governments 15,334,568 2,659,093 Tobacco settlement proceeds - - Interest on investments 1,059,816 535,286 Miscellaneous 6,547,817 637,551 Sale of receivables 11,270,385 1,758,798 Total revenues 700,945,123 66,757,494

EXPENDITURES Current: General government support 195,564,062 - Education 51,636,672 - Public safety 108,131,830 - Health 39,752,199 - Transportation 3,836,680 - Economic assistance and opportunity 234,697,854 - Culture and recreation 17,571,614 - Home and community services 3,243,401 50,378,546 Debt service: Principal - - Interest - - Total expenditures 654,434,312 50,378,546 Excess (deficiency) of revenues over (under) expenditures 46,510,811 16,378,948

OTHER FINANCING SOURCES (USES) Transfers in 46,504 395 Transfers out (42,603,978) (17,602,110) Proceeds of long-term borrowings - - Refunding bond - - Payments to refund bond escrow agent - - Participation in debt service-external sources - - Bond premium - - Total other financing sources and (uses) (42,557,474) (17,601,715) Net change in fund balance 3,953,337 (1,222,767) Fund balances- beginning 70,712,601 40,439,244 Fund balances- ending $ 74,665,938 $ 39,216,477 See notes to financial statements. 7 Other Total Debt Capital Projects Governmental Governmental Service Fund Funds Funds

$ - $ - $ - $ 185,104,195 - 229,864 290,491 284,918,896 - 6,049,479 18,702,428 105,752,832 - 5,348,940 24,910,961 121,312,282 - 48,406 24,300,727 110,692,394 - 440,000 33,295,651 51,729,312 - - 7,806,998 7,806,998 1,038,865 10,231 597,931 3,242,129 - 790,408 2,264,328 10,240,104 - - 56,905 13,086,088 1,038,865 12,917,328 112,226,420 893,885,230

371,726 4,681,797 1,910,305 202,527,890 - 5,378,288 - 57,014,960 - 19,098,220 4,343,884 131,573,934 - 908,992 56,119,259 96,780,450 - 18,168,806 21,130,354 43,135,840 - 3,632 14,343,708 249,045,194 - 2,398,278 12,105,254 32,075,146 - 21,728,830 16,405,540 91,756,317

22,927,500 - 5,356,706 28,284,206 10,006,668 - 6,298,984 16,305,652 33,305,894 72,366,843 138,013,994 948,499,589

(32,267,029) (59,449,515) (25,787,574) (54,614,359)

33,650,050 11,665,765 28,272,293 73,635,007 - (1,996,307) (11,432,612) (73,635,007) - 61,725,000 - 61,725,000 33,345,000 - - 33,345,000 (36,558,388) - - (36,558,388) 284,461 4,214,047 - 4,498,508 7,161,609 - - 7,161,609 37,882,732 75,608,505 16,839,681 70,171,729 5,615,703 16,158,990 (8,947,893) 15,557,370 36,108,118 313,199 35,492,225 183,065,387 $ 41,723,821 $ 16,472,189 $ 26,544,332 $ 198,622,757

8 County of Onondaga, New York Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds To the Statement of Activities For the Year Ended December 31, 2009

Amounts reported for governmental activities in the statement of activities (page 4) are different because:

Net change in fund balances--total governmental funds (page 8) $ 15, 557,370

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. 23,529,165

Revenues reported in the governmental funds that are not reported as revenue in the statement of activities. (3,986,754)

The issuance of long-term debt (e.g., bonds, loans) 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. This amount is the net effect of these differences in the treatment of long-term debt and related items. (41,941,900)

Expenses reported in the statement of activities that are not reported as expenditures in the governmental funds. (40,828,182)

Internal service funds are used by management to charge risk management activities to individual funds:

The net deficit of certain activities of the internal service funds is reported with governmental activities. (431,511)

Change in net assets of governmental activities (page 4) $ (48,101,812)

See notes to financial statements

9 COUNTY OF ONONDAGA, NEW YORK Statement of Net Assets Internal Service Fund December 31, 2009

ASSETS Current assets: Cash and cash equivalents $ 19,775,492 Receivables 28,626 Total current assets 19,804,118 Noncurrent assets: Unfunded claims receivable 37,226,984 Total noncurrent assets 37,226,984 Total assets 57,031,102

LIABILITIES Current liabilities: Accounts payable 2,386,843 Accrued liabilities 227,587 Total current liabilities 2,614,430 Noncurrent liabilities: Unpaid claim liabilities 45,815,826 Total noncurrent liabilities 45,815,826 Total liabilities 48,430,256

NET ASSETS Unrestricted 8,600,846 Total fund net assets $ 8,600,846

See notes to financial statements. 10 COUNTY OF ONONDAGA, NEW YORK Statement of Revenues, Expenses, and Changes in Net Assets Internal Service Fund For the Year Ended December 31, 2009

OPERATING REVENUES Interdepartmental charges $ 62,028,144 Other charges 14,391,966 Total operating revenues 76,420,110

OPERATING EXPENSES Insurance premiums and benefits 72,716,901 Salary 4,420 Employee benefits 1,067 Supplies 6,571 Contractual services 953,563 General and administrative 3,312,641 Total operating expenses 76,995,163

Operating loss (575,053)

Nonoperating revenue Interest income 143,542 Total nonoperating revenue 143,542

Change in net assets (431,511)

Total fund net assets-beginning 9,032,357 Total fund net assets-end $ 8,600,846

See notes to financial statements. 11 COUNTY OF ONONDAGA, NEW YORK Statement of Cash Flows Internal Service Fund Year Ended December 31, 2009

Cash Flows From Operating Activities Receipts from interfund services provided $ 73,144,820 Payments for employee benefits (69,580,704) Payments for salary and fringes (5,487) Payments for supplies and services (2,619,387) Payments for interdepartmental charges (1,795,787) Net cash used by operating activities (856,545)

Cash Flows From Investing Activities Interest and earnings 143,542 Net decrease in cash and cash equivalents (713,003) Cash and cash equivalents -beginning 20,488,495 Cash and cash equivalents -ending $ 19,775,492

Reconciliation of Operating Income to Net Cash Used by Operating Activities: Operating loss $ (575,053) Adjustments to reconcile operating income to net cash used by operating activities: Changes in assets and liabilities: Increase in receivables (3,275,290) Increase in accounts payable 571,121 Increase in accrued liabilities 144,586 Decrease in deferred revenues (15,882) Increase in unpaid claim liabilities 2,293,973 Net cash used by operating activities $ (856,545)

See notes to financial statements. 12 COUNTY OF ONONDAGA, NEW YORK Statement of Net Assets Fiduciary Funds December 31, 2009

Cemetery Private Purpose Trust Fund Agency ASSETS Cash and investments $ 1,148,154 $ 13,229,223

LIABILITIES AND NET ASSETS Liabilities -Agency fund liabilities $ - $ 13,229,223

Net assets 1,148,154 -

Total liabilities and net assets $ 1,148,154 $ 13,229,223

COUNTY OF ONONDAGA, NEW YORK Statement of Changes in Net Assets Fiduciary Funds Year Ended December 31, 2009

Cemetery Private Purpose Trust Fund ADDITIONS Departmental $ 124,071 Interest on investments 9,703 Total additions 133,774

DEDUCTIONS 69,250

Change in net assets 64,524

Net assets - beginning 1,083,630

Net assets - ending $ 1,148,154

See notes to financial statements 13 COUNTY OF ONONDAGA, NEW YORK Combining Statement of Net Assets Component Units December 31, 2009

OCC ONCENTER ASSETS Cash and investments $ 15,728,804 $ 933,840 Accounts receivable (net of $1,385,000 reserve) 14,884,627 400,088 Due from state and federal governments 1,944,028 - Inventories - 132,206 Prepaid items and other assets 62,089 116,387 Notes receivable - - Lease receivable - - Endowment assets : Investments - - Promises to give - - Capital assets net of accumulated depreciation 76,871,984 952,359 Total assets $ 109,491,532 $ 2,534,880

LIABILITIES Accounts payable $ 2,926,721 $ 339,863 Accrued liabilities 3,287,487 136,162 Other liabilities 1,079,834 145,740 Due to Onondaga County - 720,771 Other deferred revenues 20,292,606 536,286 Long term obligations and unpaid liabilities: Due within one year 892,658 94,805 Due in more than one year 57,813,561 554,415 Total liabilities 86,292,867 2,528,042

NET ASSETS Invested in capital assets, net of related debt 34,436,607 303,139 Restricted for: Capital projects 3,192,427 37,192 Endowments - - Loans 16,765 - Unrestricted (14,447,134) (333,493) Total net assets $ 23,198,665 $ 6,838

See notes to financial statements. 14 Friends of Total Fund Rosamond Component Company Gifford Zoo OCIDA Units

$ 242 $ 1,135,829 $ 2,910,398 $ 20,709,113 - 29,369 1,368,691 16,682,775 - - - 1,944,028 1,398,992 109,602 - 1,640,800 - 42,466 - 220,942 - - 61,308 61,308 - - 37,851 37,851

- 1,863,881 - 1,863,881 - 23,892 - 23,892 - 45,061 1,655,006 79,524,410 $ 1,399,234 $ 3,250,100 $ 6,033,254 $ 122,709,000

$ 41,083 $ 133,501 $ 1,836,054 $ 5,277,222 - 75,244 - 3,498,893 - - - 1,225,574 1,358,151 498,697 140,507 2,718,126 - 24,109 - 20,853,001

- - - 987,463 - - 273,409 58,641,385 1,399,234 731,551 2,249,970 93,201,664

- - - 34,739,746

- - - 3,229,619 - 2,072,223 - 2,072,223 - - - 16,765 - 446,326 3,783,284 (10,551,017) $ - $ 2,518,549 $ 3,783,284 $ 29,507,336

15 COUNTY OF ONONDAGA, NEW YORK Combining Statement of Revenues, Expenditures, and Changes in Net Assets Component Units Year Ended December 31, 2009

OCC ONCENTER Expenses: Program operations $ 81,824,484 $ 11,434,405 Interest on indebtedness 1,983,637 - Depreciation 4,694,294 108,381 Total expenses 88,502,415 11,542,786

Program revenues: Charges for services 21,619,020 9,363,842 Operating grants and contributions 28,225,020 - Capital grants and contributions 1,038,091 - Total program revenues 50,882,131 9,363,842

Net program (expenses) revenues (37,620,284) (2,178,944)

General revenues (expenses): Contribution from Onondaga County 8,864,000 1,830,000 Interest and investment income (expense) 2,418,486 28,004 Contributions from other governments 22,019,487 - Other revenue - - Total general revenues 33,301,973 1,858,004

Change in net assets (4,318,311) (320,940) Net assets -beginning of year 27,516,976 327,778 Net assets -end of year $ 23,198,665 $ 6,838

See notes to financial statements. 16 Friends of Total Fund Rosamond Component Company Gifford Zoo OCIDA Units

$ 2,003,820 $ 2,022,553 $ 8,266,013 $ 105,551,275 - - 21,156 2,004,793 - 32,063 143 4,834,881 2,003,820 2,054,616 8,287,312 112,390,949

1,203,402 1,794,378 7,809,821 41,790,463 520,000 406,411 - 29,151,431 - - - 1,038,091 1,723,402 2,200,789 7,809,821 71,979,985

(280,418) 146,173 (477,491) (40,410,964)

- - - 10,694,000 - (644,458) 31,241 1,833,273 280,418 - - 22,299,905 - - 3,500 3,500 280,418 (644,458) 34,741 34,830,678

- (498,285) (442,750) (5,580,286) - 3,016,834 4,226,034 35,087,622 $ - $ 2,518,549 $ 3,783,284 $ 29,507,336

17 COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Background The County of Onondaga, New York (the "County") established in 1794, is a municipal corporation which performs local governmental functions within its jurisdiction, including police and law enforcement services, economic assistance, health and nursing services, maintenance of county roads, parks, waste water and clean waters, and among others, operations of Onondaga Community College and ONCENTER Management Corporation. The County is governed by an elected County Executive and nineteen elected members of the County Legislature.

Financial Reporting Entity In accordance with GASB Statement No. 14, The Financial Reporting Entity, and Statement No. 39, Determining Whether Certain Organizations are Component Units, the basic financial statements of the County include the primary government and component units that are defined as legally separate organizations for which the primary government is financially accountable. Based upon the criteria for defining the financial reporting entity in Statements No. 14 and 39, financial accountability of the primary government is determined on the basis of the component unit's fiscal dependency, appointment of a voting majority of the component unit's governing board, ability to impose its will or potential for the component unit to provide specific financial benefits to, or impose specific financial burdens on, the primary government.

Based on the application of the foregoing criteria, the following is a brief discussion of entities that are included within the County's reporting entity:

Onondaga Community College (Community College) The majority of the College's Board of Trustees are appointed by the County Executive and confirmed by the County Legislature. Substantial funding is provided by the County for the operation of the Community College, and from general obligation bonds of the County. The Community College has a fiscal year which ends August 31. The Community College is presented discretely as a component unit of the County.

Onondaga County Convention Center/War Memorial Complex Management Corporation (ONCENTER Management Corporation) The ONCENTER Management Corporation is a separate not-for-profit corporation, which manages and operates the Onondaga County Convention Center/War Memorial Complex (the Complex) and other public and civic facilities owned by the County. The ONCENTER Management Corporation and the County operate under a Management Agreement (the Agreement), which defines each party's duties and responsibilities in regard to the Complex. Under the Agreement, the ONCENTER Management Corporation is responsible for the management, operation and maintenance of the Complex, so as to maximize economic opportunities and social benefits to the residents of the County and New York State. The County will appropriate each year from its annual budget, principally from room occupancy tax revenues, funds sufficient to cover the expected excess of costs and expenses over receipts and revenues incurred by the ONCENTER Management Corporation in the performance of its obligations. The County is also responsible for funding a capital reserve for future repairs and replacements to the Complex, which are beyond annual preventative maintenance costs. The County subsidizes a substantial portion of the ONCENTER Management Corporation's operations. The Corporation is presented discretely as a component unit of the County. The Corporation’s current year-end 2009 financial statements were not available for incorporation into these financial statements. As a result, their 2008 year-end financial information is presented.

Onondaga County Housing Development Fund Company (Fund Company) The Fund Company accounts for the Onondaga County Homeownership Program consisting of construction or acquisition and rehabilitation of housing for sale to first time homebuyers of low and moderate income in

18 COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Community Development Block Grant Program administered by the County. The funding is reflected as government contributions and enables the Fund Company to partially subsidize the cost of housing to eligible participants. The majority of the Fund Company's governing body is appointed by the County. The entity provides specific financial benefits to the primary government. However, the County is not able to impose its will on the entity nor is the County financially accountable for the entity. The Fund Company is presented discretely as a component unit of the County.

Friends of Rosamond Gifford Zoo (The Friends) The Friends organization was established in 1970 to stimulate the interest of the public in the expansion and improvement of the County’s Rosamond Gifford Zoo. Membership fees and contributions are solicited to aid in Zoo operations and support additions and upgrades to exhibits. The Friends also recruit, train and coordinate zoo volunteers, operate a gift shop, and sponsor special events. The Friends are presented discretely as a component unit of the County. The Friends have a fiscal year that ends December 31, however their 2009 financial statements were not available for incorporation into these financial statements. As a result, their 2008 year-end financial information is presented.

Onondaga County Industrial Development Agency (OCIDA) OCIDA was created under the New York State Industrial Development Agency Act of 1969 as a legally separate corporate governmental agency constituting a public benefit corporation. OCIDA was formed to promote and develop the economic growth of Onondaga County and to assist in attracting industry to the County through bond and sale/leaseback financing programs and other activities. The County Legislature appoints the entire governing board and is therefore able to impose its will over the agency. OCIDA has a fiscal year that ends June 30. OCIDA is presented discretely as a component unit of the County.

Onondaga Tobacco Asset Securitization Corporation (OTASC) OTASC is a special purpose local development corporation and is considered by legal counsel to be bankruptcy-remote from the County. However, the majority of OTASC's board of directors is comprised of elected or appointed officials of the County and one independent director. Although legally separate, for financial reporting purposes, OTASC is presented as a Nonmajor Debt Service Fund due to the fact that its purpose is to exclusively serve the County.

Complete financial statements for each of the individual component units may be obtained at the entity’s administrative offices.

Onondaga Community College OCIDA Onondaga Hill, Syracuse, New York 13215 John H. Mulroy Civic Center 421 Montgomery Street, 14th Floor ONCENTER Syracuse, New York 13202 800 South State Street, Syracuse, New York 13202 The Friends One Conservation Place Fund Company Syracuse, New York 13204 John H. Mulroy Civic Center 421 Montgomery Street, 11th Floor OTASC Syracuse, New York 13202 John H. Mulroy Civic Center 421 Montgomery Street, 14th Floor Syracuse, New York 13202

19 COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Based on the foregoing criteria described in the first paragraph, the following organizations are not part of the County's reporting entity: Onondaga County Resource Recovery Agency, Onondaga County Water Authority and Central New York Regional Planning Board.

Government-wide and Fund Financial Statements The government-wide financial statements, i.e., the statement of net assets and the statement of activities, report information on all of the nonfiduciary activities of the primary government and its component units. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities are supported by taxes and intergovernmental revenues. The primary government is reported separately from certain legally separate component units for which the primary government is financially accountable.

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, 2) operating grants and contributions including State and Federal aid, 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.

As a general rule, administrative overhead is included in the functional expenses on the governmental financial statements, and has been eliminated, for the most part, from the general government support category. The effect of interfund activity has been eliminated from the government-wide financial statements.

Separate fund financial statements are provided for governmental funds, internal service funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and the internal service funds are reported separately in the fund financial statements.

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 internal service funds. 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 revenue as soon as all eligibility requirements have been met.

Governmental fund financial statements are reported using the current financial resources measurement focus and modified accrual basis of accounting. Revenues and related receivables are recorded in the accounting period that they become measurable and available. Available means collectible within the current period or soon enough thereafter, 60 days for real property taxes and 365 days for most other revenue, to be used to pay liabilities of the current period. Revenues not considered available are recorded as deferred revenues. Expenditures are recorded when a fund liability is incurred and is due and payable. Liabilities expected to be paid after twelve months are considered long-term liabilities.

Intergovernmental revenues (Federal and State aid) are accounted for on a modified accrual basis with consideration given to the legal and contractual requirements of the numerous individual programs involved. These intergovernmental revenues are of essentially two types. In one, County moneys must be expended on the specific purpose or project before any amounts will be reimbursed to the County; therefore, revenues are recognized when the expenditures are incurred. In the other, moneys are virtually unrestricted as to purpose of expenditure and nearly irrevocable (i.e., revocable only for failure to comply with prescribed compliance

20 COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

requirements). Advances received for state and federal programs are offset against outstanding receivables for those programs. These resources are reflected as revenues at the time of receipt or earlier if the measurable and available criteria are met.

Uncollected property taxes at year end are either reserved for or deferred.

Sales tax revenues are recorded on an accrual basis to include the portion of sales tax revenues attributable to the current year that is remitted to New York State and ultimately paid to the County in the subsequent year.

Investment earnings are recorded on a modified accrual basis since they are measurable and available.

Licenses and permits, charges for services, fines and forfeitures, gain contingencies, and miscellaneous revenues are generally recorded on the cash basis because they are generally not measurable until actually received.

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

The discretely presented component units are presented on the accrual basis of accounting. In accordance with GASB Statement No. 20, Accounting and Financial Reporting for Proprietary Funds and Other Governmental Entities that use Proprietary Fund Accounting, these entities have elected to apply all applicable GASB pronouncements as well as Financial Accounting Standards Board (FASB) pronouncements and Accounting Principles Board (APB) opinions, issued on or before November 30, 1989, unless those pronouncements conflict with or contradict GASB pronouncements. These entities have also elected not to apply accounting standards issued after November 30, 1989 by FASB and APB.

Internal Service funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with an internal service fund’s principal ongoing operations. Operating expenses for internal service funds include the cost of services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses.

Governmental Fund Types: Governmental funds are those through which most governmental functions of the County are financed. The County's major governmental funds are as follows:

General Fund The General Fund is the County's primary operating fund. It is used to account for all financial resources, except those required to be accounted for in another fund.

Water Environment Protection Water Environment Protection is a special revenue fund used to account for the County’s drainage and sanitation operations.

Debt Service Fund The Debt Service Fund is used to account for the accumulation of resources for, and the payment of, general long-term debt principal, interest and related costs. This includes payments of serial bond and bond anticipation notes for debt issued by the County for capital asset acquisitions for the Community College.

Capital Projects Fund The Capital Projects Fund is used to account for the financial resources to be used for the acquisition or construction of capital assets. Expenditures are transferred on an annual basis to the construction-in- progress account and the Community College.

21

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

The County’s Nonmajor governmental funds are as follows:

Nonmajor Special Revenue Funds The Nonmajor Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than major capital projects) that are legally restricted to expenditures for specified purposes including the general grants, county road and road machinery, water, Van Duyn Extended Care Facility, library and library grants, and community development funds.

Internal Service Fund Types: Internal Service fund types are used to account for the County's ongoing organizations and activities which are similar to those often found in the private sector. The measurement focus is upon determination of net income. Revenues are recognized in the accounting period in which they are earned; expenses are recognized in the period incurred, if measurable.

Internal Service Fund The Internal Service Fund is used to account principally for the County's risk management activities. The County is self-insured for certain risks including workers' compensation risks, general liability risks (judgments and claims), and medical benefits.

Fiduciary Fund Types: The fiduciary fund type is used to account for assets held by the County in a trustee or safekeeping capacity, or as an agent for individuals, private organizations or other governmental units, and/or other funds or component units.

Trust and Agency Funds The Agency Fund is used to account for money and property received and held by the County acting as an agent with only custodial responsibility in which an asset and liability are recorded in equal amounts. Private purpose trust funds are used to account for expendable trust funds in which the trust principal and earnings thereon may be expended for the purposes of the trust. Private purpose trust funds are accounted for in essentially the same manner as the governmental funds. The County’s private purpose trust fund relates to the activities of a veteran’s cemetery.

Inventories Inventories recorded in the governmental activities section of the government-wide financial statements represent automotive parts and road materials stated at average cost, and drugs and supplies that are stated at lower of cost or market.

Capital Assets Capital assets, which include property, plant, and equipment, are reported in the governmental activities column in the government-wide financial statements. Capital assets are defined by the government as assets with an initial, individual cost of more than $25,000 and an estimated useful life in excess of two years. 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 County has historical treasures, works of art, and several collections including library books and zoo animals. Acquisitions of these assets are expensed at the time of purchase. These assets are not held for financial gain. They are kept protected, unencumbered, and preserved. Any proceeds from the sales of these assets will be used to acquire other items for the collections. Most animals at the zoo are a part of a successful breeding program. The County’s historical treasures, works of art and collections are recorded as an expense at the time of acquisition.

22

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Major outlays for capital assets and improvements are capitalized as projects are completed.

The costs of normal maintenance and repairs that do not add to the value of an asset or materially extend an asset’s life are not capitalized.

Capital assets of the primary government are depreciated using the straight line method over the following estimated useful lives: Assets Years Buildings 20-40 Building improvements 20-30 Land improvements 10-20 Equipment 3-15 Infrastructure 10-50

Capital assets of the Community College are recorded at cost, or if donated, at fair market value at the date of donation. Depreciation is recorded on a straight-line basis over the estimated useful lives (5 to 30 years).

Compensated Absences Under the terms of the County's personnel policies and its union agreements, regular permanent employees earn varying amounts of vacation leave, personal time-off and sick leave benefits on the basis of past service. Employees may also earn compensatory time-off in lieu of overtime pay. Accumulated vacation, personal time-off and compensatory time-off may be paid upon termination up to a combined maximum of twenty-one days. Compensated absence liabilities relating to the governmental funds are considered long-term liabilities, except those due and payable. Accrued liability amounts are based on wage rates prevailing as of the balance sheet date and include additional estimates for the employer's salary-related costs. Accumulated non-vested sick leave benefits are only payable on the basis of the future event of employee illness, the occurrence of which is indeterminable.

Long-term Obligations 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, (if material) are deferred and amortized over the life of the bonds. Bond issuance costs in excess of $100,000 are reported as deferred charges and amortized over the term of the related debt. Bond issuance costs are reported in the functional categories of expense.

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 financing 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 from the actual debt proceeds received, are reported as expenditures in the functional categories of expense.

Patient Service Revenues – Van Duyn The Facility has agreements with third-party payors that provide for payments to the Facility at amounts different from its established rates. Payment arrangements include prospectively determined rates per discharge, reimbursed costs, discounted charges, and per diem payments. Net patient service revenue is reported at the estimated net realizable amounts from patients, third-party payors, and others for services rendered, including estimated retroactive adjustments under reimbursement agreements with third-party payors.

23

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Retroactive adjustments are accrued as a long-term liability on an estimated basis in the period the related services are rendered and adjusted in future periods, as final settlements are determined.

Participation in Debt Service - External Sources Included in other financing sources in the Debt Service Fund and Capital Projects Fund are proceeds pertaining to the participation in the County’s debt service by local corporations and other governments. For the year ended December 31, 2009, such amounts were comprised of the following:

The Debt Service Fund amount of $284,461 consists of funds received from the New York State Energy Research and Development Agency and New York State Office of Court Administration to defray capital costs associated with energy conservation projects and improvements to the County’s court facilities respectively.

The amount of $4,214,047 in the Capital Projects Fund relates to funding received from the NYS Environmental Facilities Corporation (EFC) to help fund the clean-up of Onondaga Lake.

Interfund Transactions Short-term advances between funds are accounted for in the appropriate due from (to) other fund accounts. Transactions between funds that would be treated as revenues or expenditures if they involved organizations external to the governmental unit are accounted for as revenues or expenditures in the funds involved. Transactions that constitute reimbursements of a fund for expenditures initially made from that fund which are properly applicable to another fund are recorded as expenditures in the reimbursing fund and as reductions of the expenditure in the fund that is reimbursed. All other legally authorized transfers are treated as operating transfers and are included in the results of operations of both governmental and internal service funds.

Designated Fund Balance Designations of Governmental Fund Type balances are not legally required segregations, but are designated for a specific purpose. The designations in the General Fund are made up of $7,917,081 appropriated in the 2010 budget, and $842,622 for future debt avoidance and property tax relief. Water Environment Protection designations are made up of $4,375,000 appropriated in the 2010 budget, and $30,309,425 for infrastructure improvements related to future commitments associated with Onondaga Lake (Note 15). Designations in the Other Governmental Funds are made up of $6,345,108 appropriated in the 2010 budget.

Use of Estimates The preparation of the basic financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Estimates also affect the reported amounts of revenues and expenditures during the reporting period. Actual results could differ from those estimates. Significant estimates made by the County in determination of recorded assets and liabilities include, but are not limited to, allowances for uncollectible property taxes and other receivables, reserves for self-insurance claim liabilities, and accruals for environmental, litigation and pending tax certiorari claims.

24

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

2. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS

Governmental fund balance sheet and the government-wide statement of net assets The governmental fund balance sheet includes a reconciliation between total governmental funds fund balance and net assets—governmental activities as reported in the government-wide statement of net assets. One element of that reconciliation explains that “Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds.” The details of this $1,163,927,492 difference can be found in the Summary of Changes in Capital assets on page 28. Another element of that reconciliation explains that “Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported in the funds.” The details of this $656,044,924 difference can be found in the Changes in Long-term Obligations section of these notes on page 33.

Governmental fund statement of revenues, expenditures, and changes in fund balances and the government-wide statement of activities The governmental fund statement of revenues, expenditures, and changes in fund balances includes a reconciliation between net changes in fund balances—total governmental funds and changes in net assets of governmental activities as reported in the government-wide statement of activities. One element of that reconciliation explains that “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.” The details of this $23,529,165 difference are as follows:

Net capital outlay $ 72,343,865 Depreciation expense (48,814,700) Net adjustment to increase net changes in fund balances-total governmental funds to arrive at changes in net assets of governmental activities $ 23,529,165

Another element of that reconciliation states “The issuance of long-term debt (e.g., bonds, loans) 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 this $41,941,900 difference are as follows:

Debt issued or incurred: Issuance of general obligation debt $ 97, 538,936 Additional loans 3, 184,604 Plus Premium 7,161,609 Plus gain on defeased debt 820,000 Principal repayments: General obligation debt (56,860,951) Loan payments (6,357,000) Amortization of gain on defeased debt (46,463) Amortization of premium (amortized against interest expense) (3,526,650) Amortization of issuance discounts (amortized as interest expense) 27,815 Net adjustment to increase net changes in fund balances-total governmental funds to arrive at changes in net assets of governmental activities $ 41,941,900

Another element of that reconciliation states that “Expenses reported in the statement of activities that are not reported as expenditures in the governmental funds.”

25

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

2. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS (continued)

The details of this $40,828,182 difference are as follows: Tax certiorari $ (132,000) Compensated absences 497, 464 Judgments and claims 4,29 0,216 Postemployment benefits 37 ,525,000 Workers' compensation (1,332,941) Due to agencies (1,100,608) Accrued interest 1,07 4,365 Amortization of issuance costs 6 0,955 Inventory adjustment (54,269) Net adjustment to decrease net changes in fund balances-total governmental funds to arrive at changes in net assets of governmental activities $ 40, 828,182

3. CASH, CASH EQUIVALENTS AND INVESTMENTS

Cash and cash equivalents include demand deposits accounts and all highly liquid debt instruments purchased with original maturities of three months or less. New York State statutes authorize the County to invest in obligations of the State of New York, the United States Government and its agencies, certificates of deposit, and repurchase agreements collateralized by U.S. obligations.

Cash and Equity in Pooled Cash and Investments The County maintains a cash and investment pool that is available for use by all governmental and proprietary fund types. Earnings are allocated monthly to each participating fund based on a formula that takes into consideration each fund's average balance in the pool.

The carrying amount of the County’s deposits with financial institutions was $173,088,511 and the bank balance was $177,549,925. Of these amounts, $8,709,195 represents cash and investments of OTASC.

The bank balance is categorized as follows: Amount insured by the FDIC or collateralized with securities held by the County or its agent in the County's name $ 5,991,449 Amount collateralized with securities held by the pledging financial institution's trust department or its agent in the County's name 171,558,476 Total bank balance $ 177,549,925

26

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

3. CASH, CASH EQUIVALENTS AND INVESTMENTS (continued)

Investments Investments made by the County are summarized below. The investments that are represented by specific identifiable investment securities are classified as to custodial credit risk by the three categories described as follows:

Category 1- Insured or registered, or securities held by the County or its agent in the County’s name Category 2- Uninsured and unregistered, with securities held by the counterparty’s trust department or agent in the County’s name Category 3- Uninsured and unregistered, with securities held by the counterparty, or by its trust department or agent, but not in the County’s name

All County investments are category 1.

U.S. Government Securities $ 14,064,973 Commercial Paper-OTASC 8,379,588 Money Market Funds-OTASC 239,051 Total Investments $ 22,683,612

At December 31, 2009 the carrying amount of the County's short-term investments approximates fair value (based on quoted market prices).

4. PROPERTY TAXES AND COLLECTION

The County levies taxes on real property located within the County. Collections are the responsibility of either the city tax collectors of the City of Syracuse or the town receiver or collectors for the towns in the County. As of April 1, the towns retain the full amount of their related town levy and remit the balance of collected taxes to the County. After April 1, uncollected taxes receivable of the towns are turned over to the County for collection. The City of Syracuse remits to the County only the amount of the County tax levy actually collected. The City of Syracuse retains responsibility for collecting County delinquent taxes on property within the City.

The County’s property tax calendar is as follows: Assessment date...... July 1, 2008 Levy date...... December 31, 2008 Lien date...... July 1, 2009 Due date...... January 1, 2009 Penalties and interest are added...... February 1, 2008 1.0% March 1, 2008 1.5% Tax sale-2008 delinquent taxes...... October 1, 2009 Tax auction-2004 prior delinquent taxes...... November 15, 2009

Uncollected school taxes assumed by the County as a result of settlement proceedings are reported as receivables in the General Fund to maintain central control and provide for tax settlement and enforcement proceedings. The portion of the receivable that represents taxes relevied for schools in the amount of $19,913,262 is included in the liability due to other governments at December 31, 2009. The County has the authority to levy taxes up to the New York State Constitutional tax limit which is: (a) up to 1.5% of the five- year average full assessed valuation of taxable real property, for general governmental services other than the payment of principal and interest on long-term debt, (b) in unlimited amounts for the payment of principal and interest on long-term debt, and (c) in unlimited amounts for capital appropriations. The combined tax rate to finance general governmental services other than the payment of principal and interest on long-term debt and 27

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

4. PROPERTY TAXES AND COLLECTION (continued)

capital appropriations for the year ended December 31, 2009 was .44% of the five-year average full assessed valuation of taxable real property.

5. SALE OF RECEIVABLES

Pursuant to State Real Property Tax Law and County Resolution 265 of 2009, the County is authorized to sell certain tax sale certificates (TSC). These TSC, which represent liens on certain outstanding property taxes, were sold to a trust, which in turn issued certificates of participation in the trust. As the County collects on these TSC, all tax, interest, and penalty amounts will be transferred to the trustee. The trustee will use these collections to redeem the certificates of participation and to make interest payments to the investors. The County is obligated to repurchase any TSC that remain outstanding at April 1, 2013, the end of the agreement. Any TSC that remain outstanding after final payment is made to the trustee reverts to the County. The certificates of participation do not constitute debt of the County.

6. FEDERAL AND STATE FUNDED PROGRAMS

The County participates in a number of Federal and New York State grant and assistance programs. The principal operating programs relate to temporary and medical assistance, foster care, community development, and local public works programs. These programs are subject to financial and compliance audits by the grantors or their representatives. The amount, if any, of expenditures which may be disallowed by the granting agencies cannot be determined at this time, although the County expects such amounts, if any, to be immaterial. In addition to the operating programs, the County also receives Federal and State assistance for approved capital projects. These capital projects are also subject to audit prior to a final settlement on amounts originally claimed by the County.

7. CAPITAL ASSETS

A summary of changes in the capital assets is as follows: Balance Balance Governmental activities: January 1, 2009 Additions Reductions December 31, 2009 Capital assets, not being depreciated: Land $ 17,927,717 $ 388, 583 $ - $ 18,316,300 Construction in progress 252,686,332 50, 718,954 (31,6 97,150) 271,708,136 Total capital assets, not being depreciated 270,614,049 51, 107,537 (31,6 97,150) 290,024,436 Capital assets, being depreciated: Land improvements 15,814,228 616, 142 - 16,430,370 Buildings 326,337,237 1 1,060 - 326,348,297 Building improvements 123,598,806 9, 611,947 - 133,210,753 Equipment 91,520,738 20, 553,399 ( 492,331) 111,581,806 Infrastructure 1,103,839,311 22, 156,518 - 1,125,995,829 Total capital assets, being depreciated 1,661,110,320 52, 949,066 ( 492,331) 1,713,567,055 Less accumulated depreciation for: Land improvements (9,036,294) (690,538) - (9 ,726,832) Buildings (170,830,610) (9,592,094) - ( 180,422,704) Building improvements (65,962,822) (3,846,158) - (6 9,808,980) Equipment (52,271,603) (7,952,526) 476,743 (59,7 47,386) Infrastructure (493,224,713) (26,733,384) - ( 519,958,097) Total accumulated depreciation (791,326,042) (48,814,700) 476,743 (8 39,663,999) Total capital assets, being depreciated, net 869, 784, 278 4, 134,366 (1 5,588) 8 73,9 03,05 6 Net capital assets-Governmental activities $ 1,140,398,327 $ 55,241,903 $ (31,712,738) $ 1,163,927,492 28

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

7. CAPITAL ASSETS (continued)

Depreciation expense was charged to function/programs of the primary government as follows: Governmental activities: General government $ 7, 999,107 Public safety 7, 085,660 Health 1, 472,248 Transportation 14 ,596,817 Economic assistance and opportunity 1 13,260 Culture and recreation 3, 579,469 Home and community services 13 ,968,139 Total depreciation expense-governmental activities $ 48 ,814,700

A summary of changes in the capital assets of the Community College at August 31, 2009 is as follows:

Balance Balance September 1, August 31, 2008 Additions Reductions 2009 Capital assets, not being depreciated: Construction in progress $ 15,732,971 $ 3 35,741 $ (15,732,971) $ 33 5,741 Total capital assets, not being depreciated 15,732,971 3 35,741 (15,732,971) 33 5,741

Capital assets, being depreciated: Land and building improvements 41,875,576 20,903,537 - 6 2,779,113 Buildings 72,610,227 3 26,483 - 7 2,936,710 Equipment 17,264,935 1,8 32,377 (1,044,367) 1 8,052,945 Library books 499,192 53,2 46 (43,212) 50 9,226 Total capital assets, being depreciated 132,249,930 23,1 15,643 (1,087,579) 15 4,277,994

Less accumulated depreciation: Improvements (16,573,510) (2,079,246) - (18,652,756) Buildings (44,820,108) (1,249,006) - (46,069,114) Equipment (12,453,991) (1,315,620) 1,002,011 (12,767,600) Library books (245,072) (50,421) 43,212 (252,281) Total accumulated depreciation (74,092,681) (4,694,293) 1,045,223 (77,741,751) Total capital assets, being depreciated, net 58,157,249 18,4 21,350 (42,356) 7 6,536,243 Net capital assets-Community College $ 73,890,220 $ 18,7 57,091 $ (15,775,327) $ 76 ,871,984

8. GENERAL LONG-TERM OBLIGATIONS

The County generally borrows funds on a long-term basis for the purpose of financing the acquisition of land, equipment, construction of buildings and improvements, and infrastructure. This policy enables the cost of these capital assets to be borne by the present and future taxpayers receiving the benefit of the capital assets. The provision to be made in future budgets for capital indebtedness represents the amount, exclusive of interest, authorized by the County Legislature to be collected in future years from taxpayers and others for liquidation of the long-term liabilities. Interest associated with long-term debt is recorded as an expenditure when such amounts are paid.

29

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

8. GENERAL LONG-TERM OBLIGATIONS (continued)

A portion of the Public Improvement Bonds, 1994 included zero coupon interest bonds. Accretion of the annual interest was $53,666 in 2009.

At December 31, 2009, the County had utilized 10.49% of its statutory debt limit.

Details relating to bonds payable at December 31, 2009 are summarized as follows: Description of Issue Final Interest General Obligation Bonds: Maturity Rate Total Public Improvement, 1992 2012 5.85-5.875% $ 1,907,500 General Improvement, 1992 2012 5.40-5.75% 2,310,000 General Obligation, 1996 2015 4.40-5.00% 18,000 General Obligation, 2001 2021 4.375-5.25% 940,000 General Obligation, 2002 2023 4.00-5.00% 6,050,000 General Obligation, 2003 2024 3.25-5.00% 19,500,000 General Obligation, 2003 2013 2.50-4.35% 400,000 General Obligation, 2003 2014 2.00-5.85% 7,165,000 General Obligation, 2004 2025 2.00-4.50% 8,850,000 General Obligation, 2005 2026 3.625-4.25% 12,125,000 General Obligation, 2006 2026 3.50-5.00% 30,550,000 General Obligation, 2007 2027 3.75-5.00% 23,950,000 General Obligation, 2009 2029 4.00-5.00% 61,725,000 General Obligation, 2009 2023 2.00-5.00% 33,345,000 208,835,500 OTASC: Tobacco Settlement Pass-Through Bonds, Series 2001 2043 5.00-6.00% 96,835,000 Tobacco Settlement Pass-Through Bonds, Series 2005 2060 6.00-7.15% 37,062,575 $ 342,733,075

The annual requirements and sources to amortize debt on outstanding bonds as of December 31, 2009 are as follows: Year Principal Interest Total 2010 $ 1 5,950,500 $ 15,530,232 $ 31, 480,732 2011 1 9,498,000 14,031,932 33, 529,932 2012 1 9,428,000 13,612,428 33, 040,428 2013 1 7,563,000 12,404,888 29, 967,888 2014 1 7,093,000 11,655,962 28, 748,962 2015-2019 77,323,000 47, 463,038 124, 786,038 2020-2024 56,080,000 32, 375,308 88, 455,308 2025-2029 31,535,000 21, 871,583 53, 406,583 2030-2034 17,420,000 15, 859,438 33, 279,438 2035-2039 30,018,128 45, 147,678 75, 165,806 2040-2044 11,565,000 2, 175,944 13, 740,944 2050 1 2,280,242 126,233,419 138, 513,661 2055 6 ,539,249 130,489,948 137, 029,197 2060 1 0,439,956 342,240,747 352, 680,703 $ 342 ,733,075 $ 831,092,545 $ 1,173,825,620

30

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

8. GENERAL LONG-TERM OBLIGATIONS (continued)

Advance Refunding

On December 29, 2009 the County issued $33,345,000 in General Obligation Bonds ranging from 2.0 to 5.0 percent to advance refund $1,700,000 of outstanding 1996, $5,350,000 of 1998, $5,475,000 of 1999, $5,065,000 of 2001 and $16,575,000 of 2002 General Obligation Bonds with interest ranging from 3.9 – 6.0 percent. The net proceeds of $36,558,388 after issuance costs and premium were deposited in an irrevocable trust with an escrow agent to provide for all future debt service payments on the 1996, 1998, 1999, 2001 and 2002 bonds. As a result those bonds are considered defeased and the liability for those bonds has been removed from long-term debt.

The County advance refunded the bonds to reduce its total debt service payments over the next 14 years by $3,317,822 and to obtain economic gains of $2,733,040.

Obligations Authorized Unissued

At December 31, 2009, the County has obligations authorized and unissued of $221,106,381, the proceeds of which are to be used for sewer, road and general capital purposes.

Prior Year Defeasance of Debt

In prior years, the County defeased certain general obligation bonds by placing the proceeds of new bonds and the proceeds for the sale of its future tobacco settlement revenue rights into an irrevocable trust to provide for all future debt service payments on the old debt.

A breakdown of the balance of the principal defeased as of December 31, 2009 by issue is shown below:

Issue Balance Public Improvement 1992 $ 9,082,500 Public Improvement 1993 2,800,000 Public Improvement 1994 4,890,000 General Obligation Bonds 1996 4,582,000 General Obligation Bonds 1998 17,800,000 General Obligation Bonds 1999 9,500,000 General Obligation Bonds 2001 14,835,000 General Obligation Bonds 2002 22,400,000 General Obligation Bonds 2005 10,875,000 $ 96,764,500

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COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

8. GENERAL LONG-TERM OBLIGATIONS (continued)

Other Loans Payable The State has made available to the County loans from the State Pollution Control Revolving Fund in the amount of $427,037,863, of which $145,572,734 is outstanding at December 31, 2009. The notes mature serially in varying annual amounts through 2036, with interest ranging from 2.35% to 6.55%, payable annually. The County has recorded the full amount of loans made available less any repayments remitted. Proceeds from these loans are recognized as participation in debt-external sources in the Capital Projects Fund when eligible expenditures are reimbursed by the State Pollution Control Revolving Fund. The County received $3,184,604 in proceeds in 2009.

At December 31, 2009 principal payments required on other loans payable are as follows:

Years Principal Interest Total

2010 $ 17,392,734 $ 5,927,122 $ 23,319,856 2011 6,595,000 5,678,657 12,273,657 2012 6,725,000 5,418,894 12,143,894 2013 6,420,000 5,157,102 11,577,102 2014 6,525,000 4,893,887 11,418,887 2015-2019 34,035,000 20,214,685 54,249,685 2020-2024 31,400,000 12,610,968 44,010,968 2025-2029 18,015,000 6,748,577 24,763,577 2030-2034 13,035,000 3,160,817 16,195,817 2035-2037 5,430,000 308,490 5,738,490 $ 145,572,734 $ 70,119,199 $ 215,691,933

Community College The Community College has entered into financing agreements with the Dormitory Authority of the State of New York (DASNY) to finance most of its educational facilities. The DASNY bonds for these facilities will be repaid from the appropriations received from the State of New York. As of August 31, 2009, principal requirements relating to these obligations are as follows:

Year Principal Interest Total 2010 $ 892,658 $ 1,805,580 $ 2,698,238 2011 947,548 2,068,504 3,016,052 2012 832,093 2,019,901 2,851,994 2013 947,431 1,979,383 2,926,814 2014 941,092 1,932,955 2,874,047 2015-2019 5,432,906 8,920,701 14,353,607 2020-2024 9,717,812 7,231,280 16,949,092 2025-2029 10,321,634 4,464,257 14,785,891 2030-2034 7,093,206 2,189,785 9,282,991 2035-2039 3,898,565 606,073 4,504,638 $ 41,024,945 $ 33,218,419 $ 74,243,364

32

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

8. GENERAL LONG-TERM OBLIGATIONS (continued)

OCIDA OCIDA had a loan payable to Onondaga County totaling $273,409 at 5% interest maturing on June 30, 2011. At June 30, 2009 principal payments required on this loan payable is as follows:

Year Principal Interest Total 2009 $ - $ 13,670 $ 13,670 2010 - 13,670 13,670 2011 273,409 6,835 280,244 $ 273,409 $ 34,175 $ 307,584

Through June 30, 2009, OCIDA has issued approximately $2.57 billion of industrial development and pollution control financing on behalf of county businesses. The total amount outstanding at June 30, 2009 is $272,164,441. These amounts represent conduit debt and do not appear as assets or liabilities of OCIDA. OCIDA has no obligations for the debt beyond the resources provided by related leases or loans.

Fund Company The Fund Company participates in a revolving loan payable facilitated by Onondaga County, a portion of which is payable upon the sale of each property in the Homeownership Program without interest. The balance at January 1, 2009 was $1,319,730. There were additions of $1,723,402 and reductions of $1,684,981 during 2009 resulting in an ending balance as of December 31, 2009 of $1,358,151.

Changes in Long-Term Obligations Long-Term obligation activity at December 31, 2009, is as follows:

Beginning Due Within Governmental activities: Balance Additions Reductions Ending Balance One Year Serial Bonds $ 164,447,335 $ 95,123,665 $ (50,735,500) $ 208,835,500 $ 15,265,500 OTASC Tobacco settlement bonds 137,607,755 2,415,271 (6,125,451) 133,897,575 685,000 Plus premium on serial bonds 2,315,445 7,161,609 (3,526,650) 5,950,404 - Less issuance discounts-OTASC ( 957,287) - 27,815 (929,472) - Net bonds payable 303,413,248 104,700,545 (60,359,786) 347,754,007 15,950,500 Tax certiorari 1,200,000 121, 002 (253,002) 1,068,000 210,000 Compensated absences 13,596,763 16,895,325 (16,397,861) 14,094,227 9,714,031 Judgments and claims 14,418,033 4,650,622 (360,406) 18,708,249 3,611,905 Loans 148,745,130 3,184,604 (6,357,000) 145,572,734 17,392,734 Postemployment benefits 73,367,100 37,525,000 - 110,892,100 - Due to agencies 3,424,980 - (1,100,608) 2,324,372 - Workers compensation 16,964,176 - (1,332,941) 15,631,235 - Total Governmental activities 575,129,430 167,077,098 (86,161,604) 656,044,924 46,879,170 Component Units: Community College: Dormitory Authority Bonds 29,671,646 12,201,000 (847,701) 41,024,945 892,658 Postemployment benefits 12,245,866 5,334,553 - 17,580,419 - Compensated Absences 124,123 - (23,268) 100,855 - OCIDA: Loans Payable 1,603,162 - (1,329,753) 273,409 - Total Component Units $ 43,644,797 $ 17,535,553 $ (2,200,722) $ 58,979,628 $ 892,658

33

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

9. CAPITAL PROJECTS

A summary of the County’s capital projects in excess of $5,000,000 that have at least 10% of their total authorization still unexpended at December 31, 2009 is as follows:

Project Total Authorization Amount Expended Midland Avenue Conveyances $ 145,368,853 $ 76,213,601 Consent Judgment - Clinton Street Conveyances 111,442,042 25,671,921 Interoperable Communication System 34,700,000 12,135,079 ACJ Hrbor Brook In-Water Treatment Project 31,500,000 9,122,732 Sewer Separation 14,179,647 11,097,949 OnCenter Complex Rehab/Renovations 11,339,200 3,355,917 Repaving 2009 9,525,636 5,665,931 Taft Road ROW & Construction 9,140,000 66,050 Highway Design and Right of Way 8,358,524 6,637,774 Repaving 2008 7,952,835 6,739,790 Henry Clay Blvd at Buckley Road 7,804,250 5,391,704 Onondaga County Convention Center Complex-Hotel Phase 7,334,000 6,047,076 Maintenance Reconstruction - Roads 6,814,870 4,935,611 2006 Trunk Sewer Force Main Project 6,794,750 4,158,468 Thompson Road 6,500,000 636,045 Parks for Tomorrow 2--New Elephant Exhibit 6,167,934 599,160

Based on the latest estimates of costs to complete these capital projects, the County does not anticipate the necessity of increasing related authorizations. Commitments for all construction in progress at December 31, 2009 have been reflected as reserves for encumbrances in the Capital Projects Fund.

10. RETIREMENT BENEFITS

The County participates in the New York State and Local Employees' Retirement System (ERS), a defined benefit, cost sharing multiple-employer retirement plan. The ERS provides retirement benefits as well as death and disability benefits. Obligations of employers and employees to contribute and benefits to employees are governed by the New York State Retirement and Social Security Law (NYSRSSL). As set forth in the NYSRSSL, the Comptroller of the State of New York (Comptroller) serves as sole trustee and administrative head of the ERS. The Comptroller shall adopt and may amend rules and regulations for the control of the funds. The ERS issues a publicly available financial report that includes financial statements and required supplementary information. That report may be obtained by writing to the New York State and Local Retirement Systems, 110 State Street, Albany, NY 12244. The ERS is noncontributory except for employees who joined the ERS after July 27, 1976 who contribute 3% of their salary. After ten years of service, the ERS becomes non-contributory for those employees as well. Under the authority of the NYSRSSL, the Comptroller shall certify annually the rates expressed as proportions of payroll of members, which shall be used in computing the contributions required to be made by employers to the pension accumulation fund.

The County is required to contribute an actuarially determined rate. The required contributions at December 15 for the years 2009, 2008, and 2007 were $17,026,672, $16,405,925 and $20,187,445, respectively. The County's contributions made to the ERS were equal to 100% of the contributions required for each year.

34

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

10. RETIREMENT BENEFITS (continued)

Community College The Community College provides retirement benefits to all full time employees (part-time employees may elect to become participants) through their participation in one of three retirement plans: the New York State Employees Retirement System (defined benefit plan), New York State Teachers Retirement System (defined benefit plan) or the optional defined contribution retirement plan (TIAA-CREF). New York State law provides that employees who were participants prior to July 1, 1976 are noncontributory and those who became participants on or after July 1, 1976 must contribute 3% of their total earnings. After ten years of service, the ERS becomes non-contributory for those employees as well. The Community College's policy is to accrue pension expense which amounted to $2,491,170, $2,758,885, and $2,424,582 for the years ended August 31, 2009, 2008, and 2007, respectively.

All three of these plans are multi-employer plans. The actuarial present value of accumulated plan benefits for vested and nonvested participants and net assets available for benefits and unfunded prior service costs, if any, for the Community College’s participants in these plans are not separately determinable.

Retiree Benefits In addition to providing pension benefits, the County provides certain health insurance benefits to approximately 2,740 retired employees and survivors under its self-insured health program (Note 13).

Substantially all of the County’s employees may become eligible for these benefits if they reach normal retirement age while working for the County. Total cost to the County, of providing health insurance benefits to retirees during 2009, was approximately $19.5 million. Retirees’ obligation to contribute to these benefits is dependent upon the plan options offered by the County. Total retiree contributions were $2,794,035 during 2009.

Other Postemployment Benefits In 2007, the County adopted Governmental Accounting Standards Board Statement No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions (OPEB), on a prospective basis. In the past, the County reported the cost of retiree benefits on a pay-as-you-go basis. Plan Description. The County provides OPEB to its employees under a single-employer, self-insured, benefit plan. The plan provides medical and prescription drug coverage to retirees and their covered dependents, although there is no formal obligation to do so. The financial information for the County’s plan is contained solely within these financial statements. Funding Policy. The contribution requirements of plan members and the County is established on an annual premium equivalent rate calculated by a third-party administrator based on projected pay-as-you-go financing requirements. For fiscal year 2009, the County contributed $14.6 million to the plan. Plan members receiving benefits contributed $2.8 million. Annual OPEB Cost. The County's annual OPEB cost is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and the amortized amount of any unfunded actuarial accrued liabilities (UAAL) over a period of thirty years. The following table shows the components of the County’s annual OPEB cost for the year, the amount actually contributed to the plan, and changes in the County’s net OPEB obligation.

35

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

10. RETIREMENT BENEFITS (continued)

Annual required contribution $ 54,757,700 Interest on net OPEB obligation 1,523,300 Adjustment to annual required contribution (1,319,800) Annual OPEB cost (expense) 54,961,200 Contributions made (17,436,200) Increase in net OPEB obligation 37,525,000 Net OPEB obligation--beginning of year 73,367,100 Net OPEB obligation--end of year $ 110,892,100

Three-year Trend Information.

Fiscal Year Annual Percentage Net Pension Ending Pension Cost Contributed Obligation 12/31/2007 $ 5 1,575,000 31.8% $ 35,198,000 12/31/2008 $ 5 5,605,300 31.4% $ 73,367,100 12/31/2009 $ 5 4,961,200 31.7% $ 110,892,100

Funded Status and Funding Progress. As of January 1, 2009, the most recent actuarial valuation date, the actuarial accrued liability for benefits was $700.9 million, and there were no plan assets. The covered payroll (annual payroll of active employees covered by the plan) was $186.2 million, and the ratio of the liability to the covered payroll was 376%.

Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The schedule of funding progress, presented as required supplementary information following the notes to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. Actuarial Methods and Assumptions. Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. In the January 1, 2009 actuarial valuation the projected unit credit cost method was used. The actuarial assumptions included a 4.25% investment rate of return, which is based on the portfolio of the County’s general assets used to pay these benefits and an annual medical and prescription cost trend of 9% initially, decreasing to 5% for all benefits after 7 years. The UAAL is being amortized based on a level percentage of payroll. The remaining amortization period at December 31, 2009, is twenty-seven years.

36

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

11. OPERATING TRANSFERS

Operating transfers among funds are provided as part of the annual budget. The General Fund provides operating support from the property tax levy and other resources to certain special revenue funds, capital projects, and to the Debt Service Fund in support of the funds’ specified purpose. Water Environment Protection and the County Road Fund provide support to capital projects and the Debt Service Fund for capital acquisition and debt retirement.

The following is a summary of operating transfers for the year ended December 31, 2009:

Operating Transfers From: Major Governmental Funds Nonmajor Governmental Funds Water Environment Capital General County Road Library Operating Transfers To: General Fund Protection Projects Fund Grants Fund Fund Water Fund Van Duyn Fund Totals

Major Governmental Funds: General Fund $ - $ - $ - $ 46,504 $ - $ - $ - $ - $ 4 6,504 Water Environment Protection - - - 395 - - - - 3 95 Debt Service Fund 14,059,077 13, 652,110 1,996,307 - 3, 182,518 574, 125 - 185,913 33, 650,050 Capital Projects Fund 647,608 3, 575,000 - - 6, 356,735 600, 000 171,422 315,000 11, 665,765

Nonmajor Governmental Funds: General Grants Fund 1, 070,276 375, 000 ------1 ,445,276 County Road Fund 21, 469,301 ------2 1,469,301 Road Machinery Fund 553,191 ------5 53,191 Library Fund 4, 804,525 ------4 ,804,525

Total $ 42,603,978 $ 17, 602,110 $ 1,996,307 $ 46,899 $ 9, 539,253 $ 1, 174,125 $ 171,422 $ 500,913 $ 73, 635,007

12. DUE TO/DUE FROM OTHER FUNDS

As discussed in Note 3, the County maintains a cash and investment pool. Due to/due from other funds exist for cash flow and interest income maximization purposes. These are short-term in nature and are repaid within the next fiscal year.

Due to/due from other funds at December 31, 2009 are summarized as follows:

DUE FROM: Major Funds Nonmajor Funds General General Community DUE TO: Fund Grants Development Total Major Fund - General Fund $ - $ 2,755, 212 $ 947,324 $ 3,702, 536 Nonmajor Fund - Library Fund 1,900,000 - - 1,900, 000 Total $ 1,900,000 $ 2,755,212 $ 947,324 $ 5,602, 536

37

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

13. RISK MANAGEMENT

The County is self-insured for workers' compensation, health, all general liability and certain physical damage risks. The internal service fund is used to account for the County's self-insurance activities, including general liability claims. The fund is supported by annual budget appropriations that are recorded as revenues in the Internal Service Fund and allocated pro-rata to the various governmental funds within the County.

The claims liability of $45,815,826 reported at December 31, 2009 is based on the requirements of Governmental Accounting Standards Board Statement No. 10, which requires that a liability for claims be reported if information prior to the issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss can be reasonably estimated.

Changes in the reported liabilities during fiscal year 2008 and 2009 were as follows:

Balance Claims and Balance January 1, Changes in Claim December 31, 2008 Estimates Payments 2008

Workers' Compensation $ 1 6,740,000 $ 14,785,101 $ (6,549,027) $ 24,976,074 Judgments and Claims 12 ,574,216 2,885,788 (1,041,971) 14,418,033 Medical 3 ,393,803 5 5,225,692 (54,491,749) 4,127,746 $ 32 ,708,019 $ 72,896,581 $ (62,082,747) $ 43,521,853

Balance Claims and Balance January 1, Changes in Claim December 31, 2009 Estimates Payments 2009

Workers' Compensation $ 2 4,976,074 $ 4,697,882 $ (6,409,066) $ 23,264,890 Judgments and Claims 14 ,418,033 4,650,622 (360,406) 18,708,249 Medical 4, 127,746 5 8,357,284 (58,642,343) 3,842,687 $ 43 ,521,853 $ 67,705,788 $ (65,411,815) $ 45,815,826

Workers' Compensation The County is self-insured for workers' compensation claims for all County employees as follows:

Claims incurred prior to 1991 -Fully self-insured Claims incurred in 1991 and after: Type B Coverage -Self-insured individual claims up to $100,000, and amounts greater than $1,000,000 Other than Type B Coverage -Fully self-insured

Settled claims have not exceeded this commercial coverage in any of the past three fiscal years. The County also participates in a Second Injury Fund, which is a New York State fund established to reimburse carriers or self-insured employers for a portion of expenses on certain claims made by employees with pre-existing impairments.

38

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

13. RISK MANAGEMENT (continued)

Judgments and Claims The County is a defendant in a number of lawsuits in the ordinary conduct of its affairs. The County is self- insured for individual claims up to $2,000,000 and amounts greater than $20,000,000 for all liability (including environmental liability) and certain physical damage risks. The County has excess liability insurance that covers all other claim amounts. In the opinion of County management, after considering all relevant facts, such judgments and claims will not individually or in the aggregate, have a material effect on the financial condition of the County. Such estimate is based upon individual cases reported at December 31, 2009 and available information at the time of this report.

Medical Benefits The County has contracted with a third-party administrator to manage its self-insurance program which provides certain medical benefits to all active and retired employees (Note 10). The carrying amount of the liability includes estimates of reported and unreported claims as of December 31, 2009.

14. TAX CERTIORARI CLAIMS

The County has accrued $1,068,000 for pending certiorari claims as a long-term liability in the Governmental Activities column on the Statement of Net Assets. Management believes that these estimated provisions are adequate to cover the County's liability for claims based on current available information but that these estimates may be more or less than the amount ultimately paid when the claims are settled.

Outstanding claims are not, in the opinion of management, expected to have a material effect on the County's financial position.

15. COMMITMENTS - ONONDAGA LAKE

On January 20, 1998, Onondaga County entered into an Amended Consent Judgment (“ACJ”) with the New York State Department of Environmental Conservation (“DEC”) and the Atlantic States Legal Foundation (“ASLF”). This was in settlement of litigation commenced in 1988 which alleged violations of the Clean Water Act in the discharge of wastewater into Onondaga Lake from the Metropolitan Sewage Treatment Plant (“METRO”) and combined sewer overflow (“CSO”) outfalls (the effluent) addressing, among other factors, the increased levels of bacteria, ammonia and phosphorus in lake waters contributed to by the effluent. The ACJ was filed in the U.S. District Court for the Northern District of New York.

Under the ACJ, the County has been required to undertake a number of capital projects and related monitoring activities intended to meet the effluent limits specified therein. Construction of these ACJ projects commenced in 1998. To date, thirty ACJ projects have been completed. These projects have focused on abatement of overflow from combined sewers in portions of the consolidated sanitary district and the reduction of effluents primarily from METRO. The entire ACJ program was expected to be completed within the final ACJ milestone date of January 1, 2012. However, in 2008, the ACJ parties agreed to extend the final major milestone dates for the Clinton and Harbor Brook CSO projects from January 1, 2012 to January 1, 2013 and to complete a review process on these and related CSO projects remaining to be completed under the ACJ. The review included extensive analysis of the use of green infrastructure technologies as alternatives to the current ACJ planned projects and the impacts of the use of these green technologies on the need for and sizing of collection, treatment and storage (gray) facilities when they are installed upstream of CSO discharges. The analysis illustrated the benefits of a gray/green program. In September of 2009, the parties presented to the U. S. District Court Judge for the Northern District of New York, a proposed agreement for further significant modifications

39

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

15. COMMITMENTS - ONONDAGA LAKE

to the ACJ (the Fourth Stipulation to the ACJ). The modifications were endorsed by the United States Environmental Protection Agency (“EPA”) and the Department of Justice (“DOJ”). The Onondaga Nation and a number of community groups that had opposed implementation of the remaining ACJ CSO projects expressed strong support for the modifications. The modifications replace the current CSO program with a combination of gray and green infrastructure programs to be implemented in phases over the next nine years, ultimately requiring 95% system wide annual average waste water volume capture by more environmentally beneficial methods. Projects incorporating these methods, as outlined above, are commonly referred to as “gray” and “green” projects.

The Fourth Stipulation to the ACJ requires the incorporation of both green and gray infrastructure alternatives for remaining projects with commensurate revised milestones. The deadline for completion of the CSO projects has been extended to December 31, 2018. Said Stipulation was approved by the Court on November 16, 2009.

It is anticipated that once the ACJ CSO projects have been completed, discharges from County facilities will not cause or contribute to alleged bacteria exceedences in Onondaga Lake unless applicable standards have been made more restrictive. However, despite the signing and approval of the Fourth Stipulation, in the event that the ACJ projects do not bring the County into compliance with applicable water quality standards, the County will be required to undertake additional measures.

With regard to METRO effluent limits, the County is meeting the ACJ Stage II Phosphorus effluent limits. However, the County has completed a pilot study that questions whether cost effective technology exists to meet the ACJ Stage III Phosphorus limits. At the same time, sampling data collected through the ACJ mandated Ambient Monitoring Program has shown significant improvements in lake water quality following completion of the ammonia and Stage II phosphorus facilities. These significant improvements may support arguments against the need for further phosphorus upgrades. Whether these arguments, if advanced, will result in relief from the Stage III phosphorus limits or permit the use of other less costly technology cannot be determined with reasonable certainty at this time. As required by the Fourth Stipulation to the ACJ, an interim phosphorus limit of 0.10 mg/l has been placed on the METRO WWTP effluent, and the County is conducting a study to optimize phosphorus removal with the existing facility. Also required is the completion of a work plan to investigate alternatives that will achieve a 0.02 mg/l of effluent phosphorus from METRO.

As a result of data collected by DWEP through the ACJ-mandated Ambient Monitoring Program for 2007, 2008 and 2009, the County is studying the possibility of attainment of the ACJ effluent goals without implementing further upgrades at METRO or diverting the METRO effluent to the Seneca River. Based on this data, the County and the other ACJ parties agreed to extend the deadline by which date the State of New York must determine whether the County will be required to construct additional facilities at METRO to achieve compliance with the Stage III phosphorus limit or divert all or a portion of the METRO effluent to the Seneca River. This deadline was extended from February 1, 2009 to December 31, 2011 by the Fourth Stipulation to the ACJ.

The Department of Water Environment Protection (DWEP) has advised that in today's dollars, the estimated cost of the improvements and studies required by the revised ACJ is $635 million dollars, excluding interest expenses and the cost of any possible upgrades that might eventually be required to meet the currently mandated Stage III phosphorus limit at METRO, or to divert all or a portion of the effluent from METRO to the Seneca River. Estimates of the impact upon compliance costs of the 2009 amendments to the ACJ remain

40

COUNTY OF ONONDAGA, NEW YORK Notes to the Financial Statements

15. COMMITMENTS - ONONDAGA LAKE (continued)

preliminary. It is too early in the planning process for the revised projects to develop more than conceptual estimates of compliance costs.

The State has appropriated $74.9 million of the Clean Water/Clean Air Environmental Bond Act funds for projects covered under the ACJ. In addition to aid through the Environmental Bond Act, based on pledges by State officials, the County also planned on receiving approximately $85 million in supplemental funding over the 15 year project as initially scheduled in the 1998 ACJ. To date, of the $85 million in pledged funding, $50 million has been appropriated from other New York State sources; an additional $10 million is being processed through the 2007-08 budget, and another $10 million in each of the State's 2008-09 and 2009-10 budgets. An additional $5 million is being processed through the State’s 2011 budget. The federal government has already appropriated $120.1 million in federal funds (inclusive of assistance from the U.S. Army Corps of Engineers). Short-term funding of $20 million for the Harbor Brook Project is extended under the ARRA program and this project is eligible for up to 50% loan forgiveness.

In addition, the County has received $11.6 million in funds from the City and the Niagara Mohawk Power Corporation, (now National Grid) and has cash on hand of $8.8 million.

To date, the County has closed on $98 million in EFC long term loans to fund Lake projects. The County anticipates $236 million in future local funding for the gross capital costs associated with the ACJ in its Capital Improvement Plan. The County has earmarked $30.3 million of its Water Environment Protection fund balance for principal and interest costs to cover the County’s local share of future debt costs not recoverable through State and federal grants and associated with the ACJ project. As of December 31, 2009, the Consolidated Sanitary District also has an additional $29.5 million in bonded debt reserves available to apply against future debt costs not recoverable through State and Federal grants associated with the ACJ project.

41

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REQUIRED

SUPPLEMENTARY INFORMATION

COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) General Fund Year Ended December 31, 2009

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Budgetary fund balance, January 1 $ 3,684,844 $ 3,702,771 $ - $ (3,702,771) Resources (inflows): Real property taxes County wide 178,250,496 178,250,496 174,634,648 (3,615,848) Other real property tax items 8,275,000 8,275,000 8,459,572 184,572 Sales tax and use tax 318,576,679 318,576,679 284,398,541 (34,178,138) Federal aid 62,170,420 62,614,984 81,000,925 18,385,941 State aid 97,782,038 98,607,511 91,052,381 (7,555,130) Charges for services 103,457,898 103,498,649 97,061,106 (6,437,543) Miscellaneous 6,020,739 6,058,814 6,547,817 489,003 Interest on Investments 1,891,631 1,891,631 1,059,816 (831,815) Sale of receivables - - 11,270,385 11,270,385 Amounts available for appropriation 780,109,745 781,476,535 755,485,191 (25,991,344)

Charges to appropriations (outflows): General government support: Center for forensic science 5,998,298 6,243,120 5,745,696 497,424 County clerk 3,175,967 3,253,286 3,252,127 1,159 County comptroller 2,756,425 2,899,052 2,789,510 109,542 County executive 1,377,188 1,421,749 1,386,605 35,144 County legislature 2,216,951 2,246,171 1,977,606 268,565 County provision for wage adjustments 5,687,180 920,985 - 920,985 County special expense 3,358,000 3,300,868 3,067,766 233,102 District attorney 8,343,764 8,664,258 8,613,360 50,898 Elections board 3,187,837 3,191,570 2,589,924 601,646 Facilities management 19,145,219 19,783,368 17,425,912 2,357,456 Finance, county wide allocations 3,523,126 3,661,887 3,264,022 397,865 Finance, management and budget 156,529,343 156,604,669 151,486,716 5,117,953 Information technology 11,941,294 12,466,246 11,628,534 837,712 Law department 4,159,626 4,260,916 4,120,506 140,410 Personnel department 2,060,505 2,141,422 2,052,562 88,860 Public defender 7,200,730 7,300,147 7,299,312 835 Purchasing department 1,362,346 1,411,447 1,376,239 35,208 242,023,799 239,771,161 228,076,397 11,694,764 Education: Authorized agencies 670,440 377,488 377,488 - Community college chargebacks 8,864,000 8,864,000 8,864,000 - Education of handicapped children 43,319,546 43,319,546 42,395,184 924,362 52,853,986 52,561,034 51,636,672 924,362

See notes to required supplementary information See independent auditors' report 42 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) General Fund Year Ended December 31, 2009 continued Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Public Safety: Corrections 19,472,771 19,947,065 19,528,145 418,920 Emergency communications 14,109,410 14,472,198 13,482,182 990,016 Emergency management 1,069,577 1,093,572 976,352 117,220 Probation 14,542,528 14,918,617 14,198,029 720,588 Sheriff- civil division 33,920,790 34,139,027 31,319,142 2,819,885 Sheriff- custody division 33,308,453 33,370,548 32,624,607 745,941 STOP DWI 978,782 979,459 840,169 139,290 117,402,311 118,920,486 112,968,626 5,951,860 Health: Health 21,470,640 22,215,455 20,768,320 1,447,135 LTC community services 1,722,195 1,734,876 1,556,736 178,140 Mental health 26,317,798 26,531,249 23,735,795 2,795,454 49,510,633 50,481,580 46,060,851 4,420,729

Transportation 3,811,069 3,841,681 3,836,680 5,001 Economic Assistance and Opportunity: Authorized agencies human 59,548 59,548 59,548 - Economic development 848,932 775,852 679,579 96,273 Job training administration 556,767 573,672 439,681 133,991 Social services - administration 73,103,348 75,143,462 73,711,512 1,431,950 Social services - programs 171,644,231 171,644,231 169,834,205 1,810,026 Veterans service 390,820 398,779 346,857 51,922 246,603,646 248,595,544 245,071,382 3,524,162 Culture and Recreation: Aging and youth programs 1,507,996 1,616,889 1,489,615 127,274 Authorized agencies financial 3,250,299 3,250,299 3,045,713 204,586 Authorized agencies human 334,580 507,532 504,701 2,831 Parks and recreation 13,130,096 13,375,336 12,531,585 843,751 18,222,971 18,750,056 17,571,614 1,178,442 Home and Community Services: Authorized agencies financial 1,548,925 1,668,925 1,668,925 - Authorized agencies physical 62,356 62,356 62,356 - Human rights 362,525 385,493 382,134 3,359 Office of environment 144,003 148,675 142,591 6,084 Onondaga planning agency 1,614,532 1,665,698 1,496,152 169,546 3,732,341 3,931,147 3,752,158 178,989 Other uses: Transfer to other funds (45,948,989) (46,591,166) (42,600,253) 3,990,913 Total charges to appropriations 780,109,745 783,443,855 751,574,633 31,869,222 Budgetary fund balance, December 31 $ - $ (1,967,320) 3,910,558 $ 5,877,878

Unused project balances treated as revenue for financial reporting purposes 46,504 Unused project balances treated as expenditures for financial reporting purposes (3,725) Net change in fund balance-GAAP basis $ 3,953,337

43 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) Water Environment Protection Year Ended December 31, 2009

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Budgetary fund balance, January 1 $ 4,555,000 $ 4,985,000 $ 1,223,162 $ (3,761,838) Resources (inflows): Real property taxes County wide 2,009,975 2,009,975 2,009,975 - Charges for services 63,146,704 63,146,704 62,711,463 (435,241) Interest on investments 1,233,000 1,233,000 535,286 (697,714) Miscellaneous 575,242 575,242 637,551 62,309 Sale of receivables - - 1,758,798 1,758,798 Amounts available for appropriation 71,519,921 71,949,921 68,876,235 (3,073,686) Charges to appropriations (outflows): Home and Community Services: Bear Trap Ley Creek 353,132 353,132 336,510 16,622 Bloody Brook 108,684 108,684 103,660 5,024 Consolidated Sanitary District 55,918,113 54,328,894 49,677,743 4,651,151 Flood Control 856,029 864,522 797,387 67,135 Harbor Brook 209,007 209,007 199,347 9,660 Meadow Brook 167,206 167,206 159,478 7,728 Nondepartmental: Transfers to other funds 13,907,750 17,707,750 17,602,110 105,640 Total charges to appropriations 71,519,921 73,739,195 68,876,235 4,862,960 Budgetary fund balance, December 31 $ - $ (1,789,274) - $ 1,789,274

Budgetary fund balance is not a current year revenue for financial purposes (1,223,162) Unused project balances treated as revenue for financial reporting purposes 395 Net change in fund balance-GAAP basis $ (1,222,767)

Other Postemployment Benefits Plan Schedule of Funding Progress (in millions) Actuarial Accrued Liability UAAL as a

Actuarial Actuarial (AAL) Unfunded Percentage Valuation Value of Entry AAL Funded Covered of Covered Date Assets Age (UAAL) Ratio Payroll Payroll 01/01/07 - $666.2 $666.2 0.0% $167.5 398.0% 01/01/08 - $700.9 $700.9 0.0% $180.3 389.0% 01/01/09 - $700.9 $700.9 0.0% $186.2 376.0% See notes to required supplementary information See independent auditors' report 44 COUNTY OF ONONDAGA, NEW YORK Notes to the Required Supplementary Information

1. BUDGET PROCEDURES

The General Fund, Special Revenue Funds and Debt Service Fund each have legally adopted annual budgets. OTASC, a blended component unit does not have a legally adopted budget.

The Capital Project Fund contains the various capital programs in process. A capital project's budget is a financial plan for a period longer than one fiscal year. Comparisons of budget to actual for a fiscal year do not present a meaningful comparison and are, therefore, not presented.

The following is a summary of annual procedures used for establishing the budgetary data reflected in the financial statements:

Prior to September 20, the County Executive submits to the County Legislature a proposed operating budget for the fiscal year commencing January 1. The operating budget includes proposed expenditures and the means of financing them.

Public hearings are conducted to obtain taxpayer comments.

Prior to October 25, the budget is legally enacted through passage of legislative resolution or by provisions in the County Charter.

Budgets for general, special revenue and debt service funds are adopted and controlled at the department and object of expense level.

The County Executive is authorized to transfer appropriations within payroll and fringe benefit accounts, and up to $7,500 within non-payroll related accounts. The County Legislature maintains legal responsibility for all remaining budget amendments and transfers.

Appropriations in the governmental funds lapse at the end of the fiscal year except that outstanding encumbrances are reappropriated in the succeeding year by law. Budgeted amounts are as originally adopted, or as amended by the County Legislature. Individual amendments for the current year were not material in relation to the original appropriations.

2. BUDGETARY BASIS REPORTS

The "actual" column on the Budgetary Comparison Schedules Budget and Actual (Non-GAAP Budgetary Basis) for the major governmental funds, differs from the amounts reported on the Statement of Revenues, Expenditures and Changes in Fund Balances—Governmental Funds because certain items are reported differently for GAAP than they are treated in the budget. These differences do not have an effect on fund balance and represent elimination of revenues and expenditures. They include interdepartmental reimbursements and refunds of prior years expenditures that are recognized as revenues in the General and Water Environment Protection Funds for budgetary purposes but are recorded as an offset to such current year expenditures for GAAP purposes.

45

COMBINING FINANCIAL STATEMENTS

AND

BUDGETARY COMPARISON SCHEDULES

N O N - M A J O R F U N D S S P E C I A L R E V E N U E F U N D S Special Revenue Funds are established to account for the proceeds of specific revenue sources that are legally restricted to expenditures for certain defined purposes. The Special Revenue Funds of the County are: General Grants Fund The General Grants Fund accounts for resources associated with multi-year grant funded projects. County Road Fund The County Road Fund is used to account for the maintenance and repair of County roads and bridges and snow removal costs, as defined by New York State Highway Law. Road Machinery Fund The Road Machinery Fund is used to account for the purchase, repair and maintenance of highway machinery, tools and equipment and for the construction, purchase and maintenance of buildings for the storage and repair of highway machinery and equipment. Water Fund The Water Fund is used to account for the supply, distribution and transmission of the County's available water resources. Van Duyn Extended Care Fund The Van Duyn Extended Care Fund is used to account for the County's nursing home facility. Library and Library Grants Funds The Library Fund and the Library Grants Fund are used to account for the operation of the County's public library. Community Development Fund The Community Development Fund is used to account for various projects financed by entitlements from the U.S. Department of Housing and Urban Development.

D E B T S E R V I C E F U N D O T A S C OTASC is a blended component unit used to account for the accumulation of resources for, and the payments of, Tobacco Settlement Pass-Through Bonds issued in 2001 and 2005.

COUNTY OF ONONDAGA, NEW YORK Combining Balance Sheet Nonmajor Governmental Funds December 31, 2009

Special Revenue Funds General County Road Water Grants Road Machinery Fund ASSETS Cash and investments $ 10,900 $ 578,246 $ 239,104 $ 329,245 Accounts receivable (net of $1,425,156 reserve) 757,295 196,374 45,299 1,228,350 Due from state and federal governments 9,627,886 - - - Due from other funds - - - - Due from other governments - - - 4,167 Inventories - - - - Prepaid items 49,936 141,575 - 33,253 Restricted assets - - - - Total assets $ 10,446,017 $ 916,195 $ 284,403 $ 1,595,015

LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ 1,267,420 $ 495,890 $ 181,130 $ 222,714 Accrued liabilities 1,114,417 377,380 35,026 115,151 Due to third party payors - - - - Contracts payable-retainage 11,378 - - - Other liabilities - - - - Due to other funds 2,755,212 - - - Due to other governments - - - - Other deferred revenues 914,400 - - 47,803 Total liabilities 6,062,827 873,270 216,156 385,668

Fund balances: Reserved for: Prepaids 49,936 141,575 - 33,253 Debt service - - - - Encumbrances 2,482,321 9,295 13,081 171,371 Unreserved: Designated - - - - Undesignated 1,850,933 (107,945) 55,166 1,004,723 Total fund balances 4,383,190 42,925 68,247 1,209,347 Total liabilities and fund balances $ 10,446,017 $ 916,195 $ 284,403 $ 1,595,015

See independent auditors' report 46 Debt Total Special Revenue Funds Service Fund Nonmajor Van Duyn Library Library Grants Community Governmental Fund Fund Fund Development OTASC Funds

$ 5,280,076 $ 80,194 $ 167,726 $ 300 $ 8,709,195 $ 15,394,986 5,808,406 61,310 - - - 8,097,034 - 41,810 274,424 1,214,930 - 11,159,050 - 1,900,000 - - - 1,900,000 - - - 1,398,992 - 1,403,159 171,639 - - - - 171,639 364,505 99,108 1,269 14,389 - 704,035 350,568 - - - - 350,568 $ 11,975,194 $ 2,182,422 $ 443,419 $ 2,628,611 $ 8,709,195 $ 39,180,471

$ 563,963 $ 121,064 $ 9,449 $ 405,604 $ - $ 3,267,234 1,046,281 238,897 10,053 25,979 - 2,963,184 301,093 - - - - 301,093 - - - - - 11,378 20,454 - - - - 20,454 - - - 947,324 - 3,702,536 - - - 927,575 - 927,575 196,983 - 283,499 - - 1,442,685 2,128,774 359,961 303,001 2,306,482 - 12,636,139

364,505 99,108 1,269 14,389 - 704,035 - - - - 8,618,637 8,618,637 615,240 336,988 33,992 1,258,261 - 4,920,549

5,759,001 586,107 - - - 6,345,108 3,107,674 800,258 105,157 (950,521) 90,558 5,956,003 9,846,420 1,822,461 140,418 322,129 8,709,195 26,544,332 $ 11,975,194 $ 2,182,422 $ 443,419 $ 2,628,611 $ 8,709,195 $ 39,180,471

47 COUNTY OF ONONDAGA, NEW YORK Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds For the Year Ended December 31, 2009

Special Revenue Funds General County Road Water Grants Road Machinery Fund REVENUES Sales tax and use tax $ 290,491 $ - $ - $ - Federal aid 12,565,244 - - - State aid 17,260,682 4,747,921 - - Departmental 912,011 21,412 972,101 8,946,271 Service for other governments 1,301,176 2,061,140 - 50,000 Tobacco settlement proceeds ---- Interest on investments (11,672) - - 10,723 Miscellaneous 1,682,876 61,903 290,645 25,539 Sale of receivables - - - 56,905 Total revenues 34,000,808 6,892,376 1,262,746 9,089,438

EXPENDITURES Current: General government support 1,813,045 - - - Public safety 4,343,884 - - - Health 13,538,026 - - - Transportation 161,891 18,801,969 2,166,494 - Economic assistance and opportunity 14,343,708 - - - Culture and recreation 558,525 - - - Home and community services 661,764 - - 8,324,460 Debt service: Principal ---- Interest ---- Total expenditures 35,420,843 18,801,969 2,166,494 8,324,460 Excess (deficiency) of revenues over (under) expenditures (1,420,035) (11,909,593) (903,748) 764,978

OTHER FINANCING SOURCES (USES) Transfers in 1,517,276 21,469,301 553,191 - Transfers out (46,899) (9,539,253) (72,000) (1,174,125) Total other financing sources and (uses) 1,470,377 11,930,048 481,191 (1,174,125) Net change in fund balance 50,342 20,455 (422,557) (409,147) Fund balances- beginning 4,332,848 22,470 490,804 1,618,494 Fund balances- ending $ 4,383,190 $ 42,925 $ 68,247 $ 1,209,347

See independent auditors' report 48 Debt Total Special Revenue Funds Service Fund Nonmajor Van Duyn Library Library Community Governmental Fund Fund Grants Development OTASC Eliminations Funds

$ - $ - $ - $ - $ - $ - $ 290,491 - - 118,984 6,018,200 - - 18,702,428 - 1,058,404 431,053 1,412,901 - - 24,910,961 13,568,886 129,678 - (249,632) - - 24,300,727 24,062,113 5,821,222 - - - - 33,295,651 ----7,806,998 - 7,806,998 92,266 - - - 506,614 - 597,931 57,768 144,217 1,000 380 - - 2,264,328 ------56,905 37,781,033 7,153,521 551,037 7,181,849 8,313,612 - 112,226,420

----97,260 - 1,910,305 ------4,343,884 42,581,233 -----56,119,259 ------21,130,354 ------14,343,708 - 10,992,067 554,662 - - - 12,105,254 - - - 7,419,316 - - 16,405,540

----5,356,706 - 5,356,706 ----6,298,984 - 6,298,984 42,581,233 10,992,067 554,662 7,419,316 11,752,950 - 138,013,994

(4,800,200) (3,838,546) (3,625) (237,467) (3,439,338) - (25,787,574)

- 4,804,525 125,000 - - (197,000) 28,272,293 (171,422) (625,913) - - - 197,000 (11,432,612) (171,422) 4,178,612 125,000 - - - 16,839,681 (4,971,622) 340,066 121,375 (237,467) (3,439,338) - (8,947,893) 14,818,042 1,482,395 19,043 559,596 12,148,533 - 35,492,225 $ 9,846,420 $ 1,822,461 $ 140,418 $ 322,129 $ 8,709,195 $ - $ 26,544,332

49 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) General Grants Fund Year Ended December 31, 2009

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Budgetary fund balance, January 1 $ - $ - $ - $ - Resources (inflows): Sales tax and use tax 101,200 (472,340) 290,491 762,831 Federal Aid Education 385,292 670,437 374,207 (296,230) Public safety 732,000 3,468,049 514,274 (2,953,775) Health 5,015,464 9,893,321 5,155,254 (4,738,067) Transportation 57,800 1,228,442 (306,018) (1,534,460) Social services 5,905,127 8,713,212 4,602,725 (4,110,487) Other economic assistance 2,449,718 2,812,307 2,272,173 (540,134) Home and community services - 118,494 (47,371) (165,865) Total federal aid 14,545,401 26,904,262 12,565,244 (14,339,018) State Aid General government support 15,500 679,576 303,082 (376,494) Public safety 3,561,971 10,219,464 3,241,566 (6,977,898) Health 5,304,946 12,252,194 7,936,062 (4,316,132) Transportation - 349,537 41,581 (307,956) Social services 1,722,834 4,955,431 2,750,796 (2,204,635) Other economic assistance 2,563,946 2,951,608 2,399,848 (551,760) Culture and recreation - 301,519 47,674 (253,845) Home and community services 125,555 6,789,461 540,073 (6,249,388) Total state aid 13,294,752 38,498,790 17,260,682 (21,238,108) Departmental General government support 57,000 (65,497) 113,428 178,925 Public safety 16,800 103,851 104,288 437 Health 639,098 477,751 441,626 (36,125) Culture and recreation - 508,884 694,295 185,411 Total departmental 712,898 1,024,989 1,353,637 328,648

Service for Other Governments Public safety 1,376,927 1,322,616 1,268,176 (54,440) Health 20,000 188,000 8,000 (180,000) Other economic assistance 25,000 25,000 25,000 - Total service for other governments 1,421,927 1,535,616 1,301,176 (234,440)

See independent auditors' report 50 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) General Grants Fund Year Ended December 31, 2009 continued

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Interest earnings - (11,672) (11,672) -

Miscellaneous 1,184,479 1,676,106 1,682,876 6,770

Transfers from other funds 870,165 1,527,882 1,513,551 (14,331) Amounts available for appropriations 32,130,822 70,683,633 35,955,985 (34,727,648)

Charges to appropriations (outflows): General Government Support Board of elections - 463,748 50,805 412,943 County clerk 57,000 165,943 112,945 52,998 County legislature - 125,273 11,067 114,206 District attorney 2,020,283 2,459,731 1,490,041 969,690 Finance, management and budget 15,500 466,615 37,837 428,778 Information technology - 66,500 65,500 1,000 Law - 6,613 - 6,613 Purchasing - 1,538 - 1,538 Personnel department 50,000 116,234 44,850 71,384 Total general government support 2,142,783 3,872,195 1,813,045 2,059,150

Public Safety Corrections 288,000 538,438 317,401 221,037 Emergency communications - E911 -41-41 Emergency management 1,402,200 5,955,596 791,888 5,163,708 Probation 908,459 2,093,169 392,209 1,700,960 Sheriff 1,846,112 6,329,583 2,834,386 3,495,197 Special traffic programs - 85,178 8,000 77,178 Total public safety 4,444,771 15,002,005 4,343,884 10,658,121

continued 51 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) General Grants Fund Year Ended December 31, 2009 continued

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Health Center for forensic sciences 1,449,928 1,928,641 1,363,669 564,972 Health 9,778,276 17,721,966 9,758,933 7,963,033 Long term services - 3,214,712 2,842,144 372,568 Mental health - 1,000,000 14,906 985,094 Total health 11,228,204 23,865,319 13,979,652 9,885,667

Transportation - 1,745,018 161,891 1,583,127

Economic Assistance and Opportunity Aging and youth 5,835,407 6,990,586 5,570,290 1,420,296 Economic development 33,500 1,047,433 675,010 372,423 Social services 8,328,457 14,517,027 8,098,408 6,418,619 Total economic assistance and opportunity 14,197,364 22,555,046 14,343,708 8,211,338

Culture and Recreation 117,700 857,035 558,525 298,510

Home and Community Services Planning agency - 6,640,241 558,857 6,081,384 Water environment protection - 479,622 102,907 376,715 Total home and community service - 7,119,863 661,764 6,458,099 Total charges to appropriations 32,130,822 75,016,481 35,862,469 39,154,012 Budgetary fund balance, December 31 $ - $ (4,332,848) 93,516 $ 4,426,364

Unused project balances treated as revenues for financial reporting purposes 3,725 Unused project balances treated as expenditures for financial reporting purposes (46,899) Net change in fund balance-GAAP basis $ 50,342

See independent auditors' report 52 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) County Road Fund Year Ended December 31, 2009

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Budgetary fund balance, January 1 $- $- $- $- Resources (inflows): State Aid Transportation 4,747,636 4,747,636 4,747,921 285 Total state aid 4,747,636 4,747,636 4,747,921 285

Departmental 3,541,698 3,541,698 3,362,139 (179,559) Services for Other Governments 1,569,831 2,061,140 2,061,140 - Miscellaneous 36,200 64,300 61,903 (2,397) Transfers from other funds 21,239,815 23,869,301 21,469,301 (2,400,000) Amounts available for appropriations 31,135,180 34,284,075 31,702,404 (2,581,671) Charges to appropriations (outflows): Transportation 20,400,616 23,216,481 22,142,696 1,073,785 Total charges to appropriations 20,400,616 23,216,481 22,142,696 1,073,785 Other Financing Uses Transfer to other funds 10,734,564 11,070,254 9,539,253 1,531,001 Total financing sources and uses 10,734,564 11,070,254 9,539,253 1,531,001 Budgetary fund balance, December 31 $ - $ (2,660) $ 20,455 $ 23,115

See independent auditors' report 53 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) Road Machinery Fund Year Ended December 31, 2009

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Budgetary fund balance, January 1 $ - $ - $ - $ - Resources (inflows): Departmental 4,212,745 6,128,015 6,067,247 (60,768) Miscellaneous 478,159 478,159 290,645 (187,514) Transfers from other funds 4,135,216 1,903,191 553,191 (1,350,000) Amounts available for appropriations 8,826,120 8,509,365 6,911,083 (1,598,282) Charges to appropriations (outflows): Transportation 8,754,120 8,937,317 7,261,640 1,675,677 Total charges to appropriations 8,754,120 8,937,317 7,261,640 1,675,677 Other Financing Uses Transfer to other funds 72,000 72,000 72,000 - Total financing sources and uses 72,000 72,000 72,000 - Budgetary fund balance, December 31 $ - $ (499,952) $ (422,557) $ 77,395

See independent auditors' report 54 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) Water Fund Year Ended December 31, 2009

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Budgetary fund balance, January 1 $ 321,046 $ 321,046 $ 321,046 $ - Resources (inflows): Departmental 9,655,054 9,655,054 8,946,271 (708,783) Service for Other Governments 50,000 50,000 50,000 - Interest on Investments 35,000 35,000 10,723 (24,277) Miscellaneous - - 25,539 25,539 Sale of receivables - - 56,905 56,905 Amounts available for appropriation 10,061,100 10,061,100 9,410,484 (650,616) Charges to appropriations (outflows): Home and Community Services 8,886,975 9,149,801 8,324,460 825,341 Nondepartmental: Transfer to other funds 1,174,125 1,174,125 1,174,125 - Total charges to appropriations 10,061,100 10,323,926 9,498,585 825,341 Budgetary fund balance, December 31 $ - $ (262,826) (88,101) $ 174,725

Budgetary fund balance is not a current year revenue for budgetary purposes (321,046) Net change in fund balance-GAAP basis $ (409,147)

See independent auditors' report 55 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) Van Duyn Extended Care Fund Year Ended December 31, 2009

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Budgetary fund balance, January 1 $ 1,859,705 $ 1,859,705 $ 1,859,705 $ - Resources (inflows): Departmental General government support 15,000 15,000 16,938 1,938 Health 16,840,761 16,840,761 13,551,948 (3,288,813) Total departmental 16,855,761 16,855,761 13,568,886 (3,286,875) Service for Other Governments Health 25,954,783 25,954,783 24,062,113 (1,892,670)

Interest on Investments - 121,422 92,266 (29,156)

Miscellaneous 54,222 54,222 57,768 3,546 Amounts available for appropriation 44,724,471 44,845,893 39,640,738 (5,205,155) Charges to appropriations (outflows): Health 44,624,471 45,371,758 42,581,233 2,790,525 Nondepartmental: Transfer to other funds 100,000 221,422 171,422 50,000 Total charges to appropriations 44,724,471 45,593,180 42,752,655 2,840,525 Budgetary fund balance, December 31 $ - $ (747,287) (3,111,917) $ (2,364,630)

Budgetary fund balance is not a current year revenue for budgetary purposes (1,859,705) Net change in fund balance-GAAP basis $ (4,971,622)

See independent auditors' report 56 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) Library Fund Year Ended December 31, 2009

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Budgetary fund balance, January 1 $ 509,351 $ 709,351 $ - $ (709,351) Resources (inflows): State Aid 1,107,119 1,107,119 1,058,404 (48,715) Departmental 640,881 640,881 615,208 (25,673) Service for Other Governments 5,806,002 5,806,002 5,821,222 15,220 Miscellaneous 114,130 114,130 144,217 30,087 Transfers from other funds 4,676,656 4,804,525 4,804,525 - Amounts available for appropriation 12,854,139 13,182,008 12,443,576 (738,432) Charges to appropriations (outflows): Culture and Recreation 12,198,226 12,592,650 11,477,597 1,115,053 Total charges to appropriations 12,198,226 12,592,650 11,477,597 1,115,053 Other Financing Uses Transfer to other funds 655,913 655,913 625,913 30,000 Total financing sources and uses 655,913 655,913 625,913 30,000 Budgetary fund balance, December 31 $ - $ (66,555) $ 340,066 $ 406,621

See independent auditors' report 57 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) Library Grants Fund Year Ended December 31, 2009

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Budgetary fund balance, January 1 $ - $ - $ - $ - Resources (inflows): Federal Aid - 237,580 118,984 (118,596) State Aid 420,024 780,509 431,053 (349,456) Miscellaneous - 44,394 1,000 (43,394) Transfers from other funds - 125,000 125,000 - Amounts available for appropriation 420,024 1,187,483 676,037 (511,446) Charges to appropriations (outflows): Culture and Recreation 420,024 1,206,526 554,662 651,864 Total charges to appropriations 420,024 1,206,526 554,662 651,864 Budgetary fund balance, December 31 $ - $ (19,043) $ 121,375 $ 140,418

See independent auditors' report 58 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) Community Development Fund Year Ended December 31, 2009

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Budgetary fund balance, January 1 $ - $ - $ - $ - Resources (inflows): Federal Aid Health - 7,265,530 1,970,096 (5,295,434) Home and community services 3,357,514 11,155,576 4,048,104 (7,107,472) Total federal aid 3,357,514 18,421,106 6,018,200 (12,402,906) State Aid Home and community services - 3,554,832 1,412,901 (2,141,931) Departmental 700 93,092 (249,632) (342,724) Miscellaneous - (313,187) 380 313,567 Transfers from other funds 195,978 195,978 - (195,978) Amounts available for appropriation 3,554,192 21,951,821 7,181,849 (14,769,972) Charges to appropriations (outflows): Home and Community Services 3,554,192 22,511,417 7,419,316 15,092,101 Total charges to appropriations 3,554,192 22,511,417 7,419,316 15,092,101 Budgetary fund balance, December 31 $ - $ (559,596) $ (237,467) $ 322,129

See independent auditors' report 59 COUNTY OF ONONDAGA, NEW YORK Budgetary Comparison Schedule Budget and Actual (Non-GAAP Budgetary Basis) Debt Service Fund Year Ended December 31, 2009

Non-GAAP Variance Budgeted Amounts Actual Favorable Original Final Amounts (Unfavorable) Budgetary fund balance, January 1 $ 1,652,160 $ 1,652,160 $ 1,652,150 $ (10) Resources (inflows): Transfers from other funds 31,765,352 31,765,352 31,653,744 (111,608) Amounts available for appropriation 33,417,512 33,417,512 33,305,894 (111,618)

Charges to appropriations (outflows): General government support 8,222,475 33,831,863 33,825,895 5,968 Education 1,216,179 1,216,179 1,216,179 - Public safety 4,115,305 5,233,304 5,233,304 - Transportation 4,383,334 7,533,334 7,533,334 - Culture and recreation 948,344 3,148,344 3,148,334 10 Home and community services: Bear trap/Ley creek 120,000 120,000 120,000 - Bloody brook 165,193 165,192 165,192 - Central sanitary districts 12,883,684 12,883,686 12,778,046 105,640 Harbor brook 182,236 1,527,236 1,527,236 - Meadow brook 606,637 3,142,637 3,142,637 - Water fund 574,125 1,174,125 1,174,125 - Total home and community services 14,531,875 19,012,876 18,907,236 105,640 Total charges to appropriations 33,417,512 69,975,900 69,864,282 111,618 Other financing sources: Proceeds of long-term borrowings - 36,558,388 36,558,388 - Budgetary fund balance, December 31 $ - $ - - $ -

Interest revenue not considered for budgetary purposes 1,038,865 Other financing sources not considered for budgetary purposes: Budgetary fund balance is not a current year revenue for budgetary purposes (1,652,150) Bond premium 3,948,221 Unused project balances treated as revenue for financial reporting purposes 1,996,306 Participation in debt service external sources 284,461 Net change in fund balance- GAAP basis $ 5,615,703

See independent auditors' report 60

STATISTICAL SECTION

(UNAUDITED)

County of Onondaga, New York Net Assets by Component Last Seven Fiscal Years (accrual basis of accounting) Schedule 1

Fiscal Year 2003 2004 Governmental activities Invested in capital assets, net of related debt $ 695,813,404 $ 700,264,987 Restricted 32,953,903 34,648,679 Unrestricted (14,701,510) 8,287,249 Total governmental activities net assets $ 714,065,797 $ 743,200,915

Business-type activities Invested in capital assets, net of related debt $ 12,796,490 $ 11,975,368 Unrestricted 8,590,554 3,123,440 Total business-type activities net assets $ 21,387,044 $ 15,098,808

Primary government Invested in capital assets, net of related debt $ 708,609,894 $ 712,240,355 Restricted 32,953,903 34,648,679 Unrestricted (6,110,956) 11,410,689 Total primary government net assets $ 735,452,841 $ 758,299,723

Note: In 2008 Van Duyn Fund was converted from an Enterprise Fund to a Special Revenue Fund 61 Fiscal Year 2005 2006 2007 2008 2009

$ 746,413,156 $ 816,829,338 $ 811,788,098 $ 852,007,509 $ 836,275,910 34,221,507 16,657,808 17,043,588 19,823,048 22,730,632 (18,747,419) 3,693,628 (16,671,873) (93,367,529) (128,645,326) $ 761,887,244 $ 837,180,774 $ 812,159,813 $ 778,463,028 $ 730,361,216

$ 11,073,722 $ 10,115,911 $ 9,583,811 $ - $ - (3,449,148) (3,930,483) (7,503,241) - - $ 7,624,574 $ 6,185,428 $ 2,080,570 $ - $ -

$ 757,486,878 $ 826,945,249 $ 821,371,909 $ 852,007,509 $ 836,275,910 34,221,507 16,657,808 17,043,588 19,823,048 22,730,632 (22,196,567) (236,855) (24,175,114) (93,367,529) (128,645,326) $ 769,511,818 $ 843,366,202 $ 814,240,383 $ 778,463,028 $ 730,361,216

62 County of Onondaga, New York Changes in Net Assets Last Seven Fiscal Years (accrual basis of accounting) Schedule 2 Fiscal Year 2003 2004 2005 Expenses Governmental activities: General government support$ 53,706,355 $ 55,124,689 $ 53,209,794 Education 40,147,705 45,882,384 55,538,478 Public safety 92,301,423 100,069,769 104,806,261 Health 48,561,044 48,966,452 47,092,053 Transportation 34,412,727 42,822,711 48,375,886 Economic assistance and opportunity 251,390,162 262,894,485 245,813,867 Culture and recreation 28,034,518 19,536,764 29,754,915 Home and community services 66,499,994 68,966,456 74,894,347 Interest on long-term debt 13,990,110 13,236,295 13,980,373 Total governmental activities expenses 629,044,038 657,500,005 673,465,974 Business-type activities: Long term care 37,319,214 40,033,404 40,414,138 Total business-type activities expenses 37,319,214 40,033,404 40,414,138 Total primary government expenses$ 666,363,252 $ 697,533,409 $ 713,880,112

Program Revenues Governmental activities: Charges for services$ 139,764,555 $ 138,961,942 $ 125,788,836 Operating grants and contributions 207,902,176 200,501,906 198,907,888 Capital grants and contributions 21,078,301 55,674,881 32,626,718 Total governmental activities program revenues 368,745,032 395,138,729 357,323,442 Business-type activities: Charges for services 34,004,898 33,445,229 32,515,528 Operating grants and contributions - - - Capital grants and contributions 83,199 3,434 6,705 Total business-type activities program revenues 34,088,097 33,448,663 32,522,233 Total primary government program revenues$ 402,833,129 $ 428,587,392 $ 389,845,675

Net (Expense)/Revenue Governmental activities$ (260,299,006) $ (262,361,276) $ (316,142,532) Business-type activities (3,231,117) (6,584,741) (7,891,905) Total primary government net expense$ (263,530,123) $ (268,946,017) $ (324,034,437)

General Revenues and Other Changes in Net Assets Governmental activities: Real property taxes$ 168,211,878 $ 182,136,568 $ 187,830,049 Sales tax and use tax 83,309,067 97,649,876 131,500,537 Investment earnings 3,939,688 3,891,986 7,282,751 Tobacco settlement proceeds 8,177,745 7,797,964 7,908,009 Participation in debt service-external sources 96,540 20,000 307,515 Sale of receivables - - - Transfers and County contributions - - - Total governmental activities 263,734,918 291,496,394 334,828,861 Business-type activities: Investment earnings 141,809 135,093 131,648 Other revenue 159,411 158,963 288,472 Transfers and County contributions - - - Total business-type activities 301,220 294,056 420,120 Total primary government $ 264,036,138 $ 291,790,450 $ 335,248,981

Change in Net Assets Governmental activities$ 3,435,912 $ 29,135,118 $ 18,686,329 Business-type activities (2,929,897) (6,290,685) (7,471,785) Total primary government$ 506,015 $ 22,844,433 $ 11,214,544 Note: In 2008 Van Duyn Fund was converted from an Enterprise Fund to a Special Revenue Fund

63 Fiscal Year 2006 2007 2008 2009

$ 198,049,372 $ 258,077,035 $ 218,159,741 $ 218,932,637 52,893,841 59,975,854 56,115,210 57,018,115 102,098,062 120,830,256 131,896,522 127,630,857 47,862,668 50,465,103 105,762,977 101,141,630 40,492,055 40,683,043 42,074,051 38,522,292 251,375,443 249,502,570 262,786,203 255,717,572 32,317,242 33,395,710 47,748,717 35,388,697 40,866,396 72,756,451 75,444,171 90,521,110 17,135,664 18,020,424 18,174,279 18,694,633 783,090,743 903,706,446 958,161,871 943,567,543

40,835,455 45,739,288 - - 40,835,455 45,739,288 - - $ 823,926,198 $ 949,445,734 $ 958,161,871 $ 943,567,543

$ 131,892,315 $ 146,275,075 $ 197,066,748 $ 180,621,469 201,629,887 196,985,978 199,017,801 215,666,695 25,946,323 32,851,548 19,934,877 11,398,419 359,468,525 376,112,601 416,019,426 407,686,583

36,136,604 36,115,472 - - 710,941 335,771 - - 300 - - - 36,847,845 36,451,243 - - $ 396,316,370 $ 412,563,844 $ 416,019,426 $ 407,686,583

$ (423,622,218) $ (527,593,845) $ (542,142,445) $ (535,880,960) (3,987,610) (9,288,045) - - $ (427,609,828) $ (536,881,890) $ (542,142,445) $ (535,880,960)

$ 190,835,482 $ 193,684,291 $ 189,794,554 $ 178,297,034 291,775,749 293,999,988 300,164,040 284,918,896 10,821,336 11,901,336 7,859,241 3,385,671 7,243,015 7,529,850 8,358,345 7,806,998 128,186 457,419 188,910 284,461 - - - 13,086,088 (1,888,020) (5,000,000) - - 498,915,748 502,572,884 506,365,090 487,779,148

97,762 11,761 - - 562,682 171,426 - - 1,888,020 5,000,000 - - 2,548,464 5,183,187 - - $ 501,464,212 $ 507,756,071 $ 506,365,090 $ 487,779,148

$ 75,293,530 $ (25,020,961) $ (35,777,355) $ (48,101,812) (1,439,146) (4,104,858) - - $ 73,854,384 $ (29,125,819) $ (35,777,355) $ (48,101,812)

64 County of Onondaga, New York Fund Balances, Governmental Funds Last Six Fiscal Years (modified accrual basis of accounting) Schedule 3

Fiscal Year 2004 2005 2006 2007 2008 2009 General Fund Reserved$ 6,166,145 $ 5,445,826 $ 6,015,265 $ 6,086,167 $ 4,838,089 $ 5,292,050 Unreserved 45,691,399 60,027,419 78,340,121 74,262,985 65,874,512 69,373,888 Total general fund$ 51,857,544 $ 65,473,245 $ 84,355,386 $ 80,349,152 $ 70,712,601 $ 74,665,938

Water Environment Protection Fund Reserved$ 2,716,507 $ 2,838,910 $ 2,761,504 $ 2,486,295 $ 2,101,093 $ 1,771,573 Unreserved 38,298,915 39,122,352 40,619,873 40,982,235 38,338,151 37,444,904 Total water environment protection fund$ 41,015,422 $ 41,961,262 $ 43,381,377 $ 43,468,530 $ 40,439,244 $ 39,216,477 65 Debt Service Fund Reserved$ 30,965,495 $ 29,970,705 $ 31,225,328 $ 33,510,895 $ 36,108,118 $ 41,723,821 Total debt service fund$ 30,965,495 $ 29,970,705 $ 31,225,328 $ 33,510,895 $ 36,108,118 $ 41,723,821

Capital Projects Fund Reserved$ 76,336,401 $ 102,343,879 $ 57,862,062 $ 41,885,429 $ 36,932,658 $ 42,216,680 Unreserved (52,160,014) (62,115,042) (36,866,958) (1,075,381) (36,619,459) (25,744,491) Total capital projects fund$ 24,176,387 $ 40,228,837 $ 20,995,104 $ 40,810,048 $ 313,199 $ 16,472,189

All Other Governmental Funds Reserved$ 14,454,429 $ 15,447,379 $ 15,304,947 $ 16,369,235 $ 18,401,521 $ 14,243,221 Unreserved, reported in: Special revenue funds 5,486,117 5,380,328 3,187,362 4,517,444 17,007,295 12,210,553 Debt service funds 70,832 69,421 77,680 77,680 83,409 90,558 Total all other governmental funds$ 20,011,378 $ 20,897,128 $ 18,569,989 $ 20,964,359 $ 35,492,225 $ 26,544,332 County of Onondaga, New York Changes in Fund Balances, Governmental Funds Last Six Fiscal Years (modified accrual basis of accounting) Schedule 4

Fiscal Year 2004 2005 2006 2007 2008 2009 Revenues Real property taxes and tax items$ 181,500,811 $ 187,399,916 $ 192,479,527 $ 193,113,915 $ 185,570,483 $ 185,104,195 Sales tax and use tax 97,649,876 131,500,537 291,775,749 293,999,988 300,164,040 284,918,896 Federal aid 107,883,672 103,029,145 105,419,994 97,933,889 83,694,221 105,752,832 State aid 148,293,115 128,505,461 122,156,216 131,903,637 135,258,457 121,312,282 Departmental 85,623,412 85,193,745 89,680,125 94,014,080 110,230,846 110,692,394 Services for other governments 27,518,666 26,927,638 28,046,479 28,552,339 73,261,416 51,729,312 Tobacco settlement proceeds 7,797,964 7,908,009 7,243,015 7,529,850 8,358,345 7,806,998 Interest on investments 3,772,237 7,056,003 10,538,549 11,435,825 7,450,197 3,242,129 Miscellaneous 17,591,642 7,329,185 7,812,217 9,790,569 9,907,113 10,240,104 66 Sale of receivables - - - - - 13,086,088 Total revenues 677,631,395 684,849,639 855,151,871 868,274,092 913,895,118 893,885,230

Expenditures General government 38,991,724 42,658,045 190,675,941 193,104,467 198,408,248 197,846,093 Education 43,609,654 43,533,866 44,514,055 48,253,633 51,383,514 51,636,672 Public safety 97,717,297 104,074,314 107,715,803 108,693,796 114,988,343 112,475,714 Health 49,532,695 47,082,258 48,097,289 50,496,551 94,432,295 95,871,458 Transportation 22,493,795 22,687,412 23,275,885 25,849,968 26,363,171 24,967,034 Economic assistance and opportunity 260,357,398 245,747,262 251,385,306 247,184,758 255,156,067 249,041,562 Culture and recreation 26,223,679 27,277,029 28,470,612 29,028,545 29,944,767 29,676,868 Home and community services 57,214,807 62,181,444 63,843,619 66,133,298 68,102,328 70,027,487 Capital outlay 69,071,826 92,462,293 113,674,114 98,433,440 87,598,359 72,366,843 Debt service: Principal 16,989,705 18,412,632 21,543,166 21,888,221 25,138,438 28,284,206 Interest 13,145,112 13,690,254 14,687,096 15,338,992 16,155,774 16,305,652 Total expenditures 695,347,692 719,806,809 907,882,886 904,405,669 967,671,304 948,499,589 Fiscal Year 2004 2005 2006 2007 2008 2009

Excess of revenues over (under) expenditures (17,716,297) (34,957,170) (52,731,015) (36,131,577) (53,776,186) (54,614,359) Other Financing Sources (Uses) Transfers in 52,639,067 90,243,708 74,681,596 79,297,472 89,026,390 73,635,007 Transfers out (52,639,067) (90,243,708) (76,569,616) (84,297,472) (89,026,390) (73,635,007) Proceeds of long-term borrowings 18,000,000 728,630,000 35,000,000 25,600,000 - 61,725,000 Refunding bond - - - - - 33,345,000 Payments to refund bond escrow agent - (18,990,501) - - - (36,558,388) Participation in debt service-external sources (4,813,904) 25,597,355 19,568,179 35,431,293 13,374,962 4,498,508 Debt issuance costs - (836,558) - - - - Bond discount - (669,227,856) - - - - Bond premium 33,770 289,681 38,665 684,282 - 7,161,609 Total other financing sources (uses) 13,219,866 65,462,121 52,718,824 56,715,575 13,374,962 70,171,729 Net change in fund balance $ (4,496,431) $ 30,504,951 $ (12,191) $ 20,583,998 $ (40,401,224) $ 15,557,370

Debt service as a percentage of noncapital

67 expenditures 4.8% 5.1% 4.6% 4.6% 4.7% 5.1% COUNTY OF ONONDAGA, NEW YORK Assessed Value and Actual Value of Taxable Property Last Ten Fiscal Years (in thousands of dollars) Schedule 5

Per $1,000 Full Fiscal REAL PROPERTY EXEMPTIONS TAXABLE Taxable Value Year Assessed Full Assessed Full Assessed Full Assessed ValueTax Ended Value Value Value Value Value Value To Full Value Rate 2000$ 19,170,571 $ 22,694,104 $ 5,767,506 $ 6,315,060 $ 13,403,065 $ 16,379,044 81.83%$ 9.18

2001 19,399,126 23,325,037 5,827,026 6,450,436 13,572,100 16,874,601 80.43% 8.78

2002 19,929,630 23,878,433 5,849,593 6,489,425 14,080,037 17,389,008 80.97% 8.35

2003 18,687,257 22,865,750 5,805,631 6,429,360 12,881,626 16,436,390 78.37% 8.68

2004 21,304,036 25,815,758 6,154,750 6,810,315 15,149,286 19,005,443 79.71% 9.06

2005 22,024,988 26,705,334 6,252,097 6,973,119 15,772,891 19,732,215 79.93% 8.86

2006 23,689,104 28,626,155 6,474,734 7,171,432 17,214,370 21,454,723 80.24% 8.52

2007 24,454,054 30,020,864 6,600,481 7,341,042 17,853,573 22,679,822 78.72% 7.91

2008 25,152,667 31,140,839 6,685,505 7,494,265 18,467,162 23,646,574 78.10% 7.28

2009 25,720,169 31,816,504 6,171,957 7,039,201 19,548,212 24,777,303 78.90% 7.02

68 COUNTY OF ONONDAGA, NEW YORK Principal Property Taxpayers Current Year and Nine Years Ago Schedule 6

2009 2000 Percentage Percentage Taxable Of Total Taxable Of Total Assessed Taxable Assessed Assessed Taxable Assessed TAXPAYER Value Rank Value Value Rank Value

National Grid / Niagara Mohawk $ 751,470,584 1 2.87%$ 625,033,327 1 2.81%

VERIZON / NY Telephone Co. 212,010,037 2 0.81% 116,051,520 2 0.52%

HUB Properties Trust 84,454,575 3 0.32% - -

Shoppingtown Mall LP 53,621,400 4 0.21% 48,771,000 3 0.22%

Wegmans Food Markets 48,711,100 5 0.19% 35,626,500 4 0.16%

Bristol Myers Squibb 44,698,600 6 0.17% 33,673,600 5 0.15%

Great Northern Holdings 39,036,800 7 0.15% - -

Aldi Inc. 35,715,000 8 0.14% - -

Carrier Corporation 26,829,100 9 0.10% 27,192,900 7 0.12%

Nob Hill of Syracuse Apartments 21,548,994 10 0.08% 18,208,900 10 0.08%

Home Properties - - 28,295,400 6 0.13%

Crucible Materials - - 20,215,000 8 0.09%

New Process Gear, Inc. - - 19,030,800 9 0.09% Total$ 1,318,096,190 5.04%$ 972,098,947 4.37%

69 COUNTY OF ONONDAGA, NEW YORK Property Tax Levies and Collections Last Ten Fiscal Years Schedule 7

Fiscal Taxes Levied Collected within the Fiscal Year of the Levy Total Collections to Date Year for the Percentage Collections in Percentage Ended Fiscal Year Amount of Levy Subsequent Years Amount of Levy

2000 $ 265,135,439 $ 254,696,348 96.06% $ 8,949,780 $ 263,646,128 99.44%

2001 250,443,805 239,419,725 95.60% 9,933,106 249,352,831 99.56%

2002 254,946,556 244,562,293 95.93% 9,232,132 253,794,425 99.55%

2003 274,649,355 264,694,937 96.38% 8,025,767 272,720,704 99.30%

2004 297,421,392 287,764,386 96.75% 7,883,610 295,647,996 99.40%

2005 300,860,868 291,355,908 96.84% 7,615,342 298,971,250 99.37%

2006 311,639,215 301,888,439 96.87% 7,550,342 309,438,781 99.29%

2007 327,022,143 316,589,528 96.81% 6,640,736 323,230,264 98.84%

2008 334,648,785 321,878,456 96.18% 7,736,176 321,878,456 96.18%

2009 341,497,443 334,543,258 97.96% - 334,543,258 97.96%

70 COUNTY OF ONONDAGA, NEW YORK Overlapping and Underlying Governmental Activities Debt As of December 31, 2009 (dollars in thousands) Schedule 8

Estimated Debt Percentage GOVERNMENTAL UNIT Outstanding Applicable

County of Onondaga $ 354,408 27.60% Total Overlapping Debt $ 354,408 27.60%

Political subdivisions within Onondaga County: Towns (as of 12/31/08) 65,175 5.08%

Villages (as of 5/31/09) 42,287 3.29%

School districts (as of 6/30/09) 479,302 37.32%

City of Syracuse and city schools (as of 8/16/09) 325,647 25.36%

Fire districts (as of 12/31/08) 17,337 1.35% Total Underlying Debt $ 929,748 72.40%

Total Overlapping and Underlying Debt $ 1,284,156 100.00%

71 COUNTY OF ONONDAGA, NEW YORK Legal Debt Margin Information Last Ten Fiscal Years (dollars in thousands) Schedule 9

Fiscal Year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Debt limit$ 1,130,543 $ 1,132,134 $ 1,137,222 $ 1,140,803 $ 1,160,205 $ 1,187,041 $ 1,229,383 $ 1,283,825 $ 1,331,236 $ 1,523,511

Total net debt applicable to limit 150,084 69,184 104,085 125,313 131,326 122,381 138,124 146,085 119,427 159,798

Legal debt margin$ 980,459 $ 1,062,950 $ 1,033,137 $ 1,015,490 $ 1,028,879 $ 1,064,660 $ 1,091,259 $ 1,137,740 $ 1,211,809 $ 1,363,713

Total net debt applicable to the limit as a percentage of debt limit 13.28% 6.11% 9.15% 10.98% 11.32% 10.31% 11.24% 11.38% 8.97% 10.49% 72

Legal Debt Margin Calculation for Fiscal Year 2009 Assessed value - 5 year average $21,764,442

Legal debt margin: Debt limit (7% of total assessed value) 1,523,511 Debt applicable to limit: General obligation bonds 354,408 Less: Excludable debt (182,240) Amount set aside for repayment of general obligation debt (12,370) Total net debt applicable to limit 159,798 Legal debt margin $1,363,713 COUNTY OF ONONDAGA, NEW YORK Ratios of Outstanding Debt by Type Last Ten Fiscal Years (dollars in thousands, except per capita) Schedule 10

General Bonded Debt Outstanding Business-Type Activities Percentage of General Actual Taxable Fiscal Obligation BANs Value of Per Enterprise Year Bonds Payable Property Capita Fund 2000 $ 177,783 36,038$ 1.31% $ 467 $ 450 2001 100,470 23,978 0.74% 272 - 2002 127,685 22,795 0.87% 329 - 2003 150,426 37,139 1.14% 410 - 2004 155,385 23,299 0.94% 391 - 2005 150,167 26,153 0.89% 388 - 2006 169,840 14,750 0.86% 407 - 2007 181,058 - 0.80% 400 - 2008 164,447 7,723 0.73% 380 - 2009 208,836 10,907 0.89% 483 -

Other Governmental Activities Debt Total Total Percentage Fiscal OTASC E-911 EFC Other Bonds Primary of Personal Per Year Bonds Loans Loans and Loans Government Income Capita 2000 $ - 2,728$ $ 40,628 $ 43,356 $ 257,627 0.90% 562$ 2001 111,470 1,905 56,120 169,495 293,943 1.01% 643 2002 110,785 1,070 59,753 171,608 322,088 1.08% 705 2003 108,380 835 78,102 187,317 374,882 1.21% 820 2004 106,865 720 71,832 179,417 358,101 1.11% 785 2005 136,667 630 94,520 231,817 408,137 1.21% 898 2006 134,877 6,540 124,295 265,712 450,302 1.27% 993 2007 132,977 8,385 145,538 286,900 467,958 1.26% 1,033 2008 137,608 6,660 148,745 293,013 465,183 1.19% 1,026 2009 133,898 34,358 145,573 313,829 533,572 1.30% 1,173

73 COUNTY OF ONONDAGA, NEW YORK Demographic and Economic Statistics Last Ten Calendar Years Schedule 11

Per Capita Personal School Unemployment Year Population Income Enrollment Rate 2000 458,336 28,772 75,106 3.5%

2001 457,339 29,110 74,917 4.0%

2002 457,085 29,802 74,363 4.9%

2003 457,139 30,926 73,563 5.1%

2004 456,432 32,226 73,055 5.1%

2005 454,625 33,668 73,367 4.5%

2006 453,533 35,400 71,871 4.3%

2007 452,944 37,227 72,564 4.0%

2008 453,373 39,088 71,375 5.1%

2009 454,753 41,042 70,768 7.7%

Source: U.S. Census Bureau 74 COUNTY OF ONONDAGA, NEW YORK Principal Employers Current Year and Nine Years Ago Schedule 12

2009 2000 Percentage Percentage of County of County Employer Employees Rank Employment Employees Rank Employment SUNY Upstate Medical University 6,717 1 3.07% 5,125 1 2.30%

Syracuse University 6,504 2 2.97% 4,065 2 1.82%

Wegmans Food Markets 4,100 3 1.87% 3,875 4 1.74%

St. Joseph's Hospital Health Center 3,046 4 1.39% 3,500 6 1.57%

Crouse Hospital 2,700 5 1.23% 2,500 8 1.12%

Loretto 2,427 6 1.11% - -

Lockheed Martin Corporation 2,350 7 1.07% 2,000 9 0.90%

National Grid/Niagara Mohawk 1,856 8 0.85% 2,800 7 1.26%

P & C Food Markets 1,750 9 0.80% 1,700 10 0.76%

Raymour and Flannigan 1,400 10 0.64% - -

Syracuse V.A. Medical Center 1,400 10 0.64% - -

Magna Drivetrain-New Process Gear In - - 3,950 3 1.77%

Carrier Corporation - - 3,525 5 1.58% Total 34,250 15.64% 33,040 14.82%

Source: Syracuse Chamber of Commerce, December 2009 75 COUNTY OF ONONDAGA, NEW YORK Full-time Equivalent County Government Employees by Function/Program Last Ten Fiscal Years Schedule 13 Full -time Employees as of January 10 Function/Program 2000 2001 2002 2003 2004 County clerk 38 38 38 35 38 County comptroller 34 36 37 36 38 County executive 11 11 11 11 11 County legislature 29 31 26 24 26 District attorney 99 96 96 93 99 Elections board 15 16 16 15 16 Facilities management 113 115 116 108 108 Finance, management and budget 33 34 35 36 34 Information technology 75 76 76 63 74 Law department 43 44 44 44 44 Personnel department 28 28 31 30 26 Purchasing department 19 19 19 18 18 General Government Support 537 544 545 513 532

Corrections 208 209 204 199 196 Emergency communications 136 134 140 130 137 Emergency management 66656 Probation 155 153 159 136 137 Sheriff civil 308 315 331 330 331 Sheriff custody 278 277 276 280 282 STOP DWI 22111 Public Safety 1,093 1,096 1,117 1,081 1,090

Health 352 354 386 378 383 LTC community services 18 15 15 14 12 LTC Van Duyn 555 537 543 551 570 Mental health department 101 101 102 91 92 Health 1,026 1,007 1,046 1,034 1,057

Transportation 227 222 228 206 204 Transportation 227 222 228 206 204

Economic development 44533 Job training administration 10 10 9 9 8 Social services department 865 842 874 801 749 Veterans service agency 33333 Economic Assistance 882 859 891 816 763

Aging and youth 18 20 22 19 18 Onondaga public libraries 74 70 70 64 60 Syracuse branch libraries 58 63 62 57 60 Parks and recreation 123 129 127 114 116 Culture & Recreation 273 282 281 254 254

Community development 11 12 12 12 12 Human rights commission 65554 Office of the environment 11111 Onondaga planning agency 16 16 15 14 17 Water board 38 36 37 36 36 Water environment protection 366 374 373 367 371 Home & Community Services 438 444 443 435 441

Total 4,476 4,454 4,551 4,339 4,341 Source: Management and Budget 76 COUNTY OF ONONDAGA, NEW YORK Full-time Equivalent County Government Employees by Function/Program Last Ten Fiscal Years Schedule 13 Full -time Employees as of January 10 Function/Program 2005 2006 2007 2008 2009 County clerk 38 38 36 39 38 County comptroller 36 35 36 36 37 County executive 11 10 11 9 13 County legislature 26 26 26 27 26 District attorney 94 95 95 100 97 Elections board 16 17 17 17 20 Facilities management 115 112 115 107 103 Finance, management and budget 30 32 32 31 29 Information technology 73 72 74 76 75 Law department 43 42 42 38 40 Personnel department 29 25 26 25 26 Purchasing department 15 14 14 12 15 General Government Support 526 518 524 517 519

Corrections 187 188 188 189 192 Emergency communications 139 141 144 145 149 Emergency management 77777 Probation 134 135 136 140 145 Sheriff civil 321 326 327 285 300 Sheriff custody 278 274 279 276 278 STOP DWI 10000 Public Safety 1,067 1,071 1,081 1,042 1,071

Health 370 363 355 364 371 LTC community services 13 11 11 14 16 LTC Van Duyn 545 545 531 559 525 Mental health department 85 86 85 80 80 Health 1,013 1,005 982 1,017 992

Transportation 199 190 189 197 195 Transportation 199 190 189 197 195

Economic development 66677 Job training administration 87766 Social services department 728 730 727 733 727 Veterans service agency 22323 Economic Assistance 744 745 743 748 743

Aging and youth 18 17 17 18 19 Onondaga public libraries 58 59 59 56 57 Syracuse branch libraries 59 61 57 54 60 Parks and recreation 111 117 117 119 117 Culture & Recreation 246 254 250 247 253

Community development 13 13 12 13 13 Human rights commission 44444 Office of the environment 11111 Onondaga planning agency 16 15 16 16 17 Water board 38 38 38 35 36 Water environment protection 383 387 386 387 387 Home & Community Services 455 458 457 456 458

Total 4,250 4,241 4,226 4,224 4,231 Source: Management and Budget 77 COUNTY OF ONONDAGA, NEW YORK Capital Asset Statistics by Function/Program Last Ten Fiscal Years Schedule 14

Fiscal Year Function/Program 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Police protection Number of police personnel and officers 595 595 585 585 585 585 540 530 538 537 Number of police vehicles 174 174 174 174 174 199 199 199 206 206 Number of stations 8888887788

Highways Miles of streets maintained 801 802 802 802 802 802 857 857 792 792 Road signs installed 1,106 1,305 1,050 1,100 794 854 957 1,025 853 1,105 Signal lights 84 84 87 88 89 90 93 93 98 100 78 Parks and recreation Athletic fields 14 14 14 14 14 14 14 14 14 14 Miles of hiking trails 56 56 56 56 56 56 56 56 56 56 Park acreage 6,510 6,510 6,510 6,580 6,580 6,580 6,580 6,580 6,580 6,580 Parks and museums 13 13 13 13 13 13 13 13 13 13

Water environment protection Average design capacity of treatment plants in gallons ( in thousands) 113,082 112,215 112,215 112,000 112,000 112,000 117,000 116,200 116,200 119,700 Miles of sanitary sewers 3,015 3,028 3,028 3,028 3,028 3,028 3,037 3,047 3,060 3,065 Number of pumping stations 119 120 120 120 120 120 140 150 148 149 Number of sewer units 177,876 180,129 183,466 181,248 181,248 181,248 181,500 180,901 180,938 181,425 Number of wastewater treatment facilities 8886666666

Water operations Maximum daily capacity of plants in gallons (in thousands) 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 Miles of water mains 81 81 81 81 81 81 81 92 92 92 Number of service connections 49 49 48 48 48 48 48 51 51 51

APPENDIX - D

FORM OF BOND COUNSEL’S OPINION $31,150,000 General Obligation (Serial) Bonds, 2010 Series A (Tax Exempt)

June 29, 2010

County of Onondaga, State of New York

Re: County of Onondaga, New York $31,150,000 General Obligation (Serial) Bonds, 2010 Series A (Tax Exempt)

Ladies and Gentlemen:

We have been requested to render our opinion as to the validity of an issue of $31,150,000 General Obligation (Serial) Bonds, 2010 Series A (Tax Exempt (the "Obligations"), of the County of Onondaga, State of New York (the "Obligor"), dated June 29, 2010, initially issued in registered form in denominations such that one bond shall be issued for each maturity of bonds, in such amounts as hereinafter set forth, bearing interest at the rate of four per centum (4.00%) per annum as to the bonds maturing in the years 2012 and 2013, both inclusive and at the rate of five per centum (5.00%) per annum as to the bonds maturing in the years 2014 to 2019, both inclusive, payable on June 15, 2011, December 15, 2011 and semi-annually thereafter on June 15 and December 15, and maturing in the amount of $4,425,000 on June 15, 2012, $4,950,000 on June 15, 2013, $4,625,000 on June 15, 2014, $5,100,000 on June 15, 2015, $3,000,000 on June 15, 2016 and June 15, 2017, inclusive, $3,050,000 on June 15, 2018 and $3,000,000 on June 15, 2019. We have examined the Constitution and statutes of the State of New York and a certified copy of proceedings of the finance board of the Obligor and other proofs authorizing and relating to the issuance of the Obligations, including the form of the Obligations. In rendering the opinions expressed herein we have assumed the accuracy and truthfulness of all public records, documents and proceedings, including factual information, expectations and statements contained therein, examined by us which have been executed or certified by public officials acting within the scope of their official capacities, and have not verified the accuracy or truthfulness thereof. We also have assumed the genuineness of the signatures appearing upon such public records, documents and proceedings and the certifications thereof.

In our opinion:

(a) The Obligations have been authorized and issued in accordance with the Constitution and statutes of the State of New York and constitute valid and legally binding general obligations of the Obligor, all the taxable real property within which is subject to the levy of ad valorem taxes to pay the Obligations and interest thereon, without limitation as to rate or amount; provided, however, that the enforceability (but not the validity) of the Obligations: (i) may be limited by any applicable bankruptcy, insolvency or other law now existing or hereafter enacted by said State or the Federal government affecting the enforcement of creditors' rights, and (ii) may be subject to the exercise of judicial discretion in appropriate cases.

(b) The Obligor has the power to comply with its covenants with respect to compliance with the Code as such covenants relate to the Obligations; provided, however, that the enforceability (but not the validity) of such covenants may be limited by any applicable bankruptcy, insolvency or other law now existing or hereafter enacted by said State or the Federal government affecting the enforcement of creditors' rights.

(c) Interest on the Obligations is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986, and is exempt from personal income taxes imposed by the State of New York and any political subdivision thereof (including The City of New York). Interest on the Obligations is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although we observe that it is included in adjusted current earnings in calculating corporate alternative minimum taxable income. We express no opinion regarding other tax consequences related to the ownership or disposition of, or the accrual or receipt of interest on, the Obligations.

The opinions expressed herein are based on an analysis of existing laws, regulations, rulings and court decisions and cover certain matters not directly addressed by such authorities. Such opinions may be affected by actions taken or omitted or events occurring after the date hereof. We have not undertaken to determine or to inform any person, whether any such actions are taken or omitted or events do occur or any other matters come to our attention after the date hereof. Our engagement with respect to the Obligations has concluded with their issuance, and we disclaim any obligation to update this opinion. We have assumed, without undertaking to verify, the accuracy of the factual matters represented, warranted or certified in the documents. We call attention to the fact that the rights and obligations under the Obligations and their enforceability may be subject to bankruptcy, insolvency, reorganization, arrangement, fraudulent conveyance, moratorium or other laws relating to or affecting creditors’ rights, to the application of equitable principles, to the exercise of judicial discretion in appropriate cases and to the limitations on legal remedies against municipal corporations such as the Obligor in the State of New York. We express no opinion with respect to any indemnification, contribution, penalty, choice of law, choice of forum, or waiver provisions contained in the foregoing documents.

The scope of our engagement in relation to the issuance of the Obligation has extended solely to the examination of the facts and law incident to rendering the opinions expressed herein. Such opinions are not intended and should not be construed to express or imply any conclusion that the amount of real property subject to taxation within the boundaries of the Obligor, together with other legally available sources of revenue, if any, will be sufficient to enable the Obligor to pay the principal of or interest on the Obligation as the same respectively become due and payable. We have not examined, reviewed or passed upon the accuracy, completeness or fairness of any factual information which may have been furnished to any purchaser of the Obligation by or on behalf of the Obligor and, accordingly, we express no opinion as to whether the Obligor, in connection with the sale of the Obligation, has made any untrue statement of a material fact or omitted to state a material fact necessary in order to make any statements made, in the light of the circumstances under which they were made, not misleading.

Very truly yours,

Orrick, Herrington & Sutcliffe LLP

APPENDIX - E

FORM OF BOND COUNSEL’S OPINION $17,570,000 General Obligation (Serial) Bonds, 2010 Series B (Federally Taxable-Build America Bonds)

June 29, 2010

County of Onondaga, State of New York

Re: County of Onondaga, New York $17,570,000 General Obligation (Serial) Bonds, 2010 Series B (Federally Taxable-Build America Bonds)

Ladies and Gentlemen:

We have been requested to render our opinion as to the validity of an issue of $17,570,000 General Obligation (Serial) Bonds, 2010 Series B (Federally Taxable-Build America Bonds) (the "Obligations"), of the County of Onondaga, State of New York (the "Obligor"), dated June 29, 2010, initially issued in registered form in denominations such that one bond shall be issued for each maturity of bonds, in such amounts as hereinafter set forth, bearing interest at the rate of four and twenty-five hundredths per centum (4.25%) per annum as to the bonds maturing in the year 2020, at the rate of four and five tenths per centum (4.50%) per annum as to the bonds maturing in the year 2021, at the rate of four and sixty- five hundredths per centum (4.65%) per annum as to the bonds maturing in the year 2022, at the rate of four and eighty hundredths per centum (4.80%) per annum as to the bonds maturing in the year 2023, at the rate of four and ninety-five hundredths per centum (4.95%) per annum as to the bonds maturing in the year 2024, at the rate of five and five hundredths per centum (5.05%) per annum as to the bonds maturing in the year 2025 and at the rate of five and fifteen hundredths per centum (5.15%) per annum as to the bonds maturing in the year 2026, payable on June 15, 2011, December 15, 2011 and semi-annually thereafter on June 15 and December 15, and maturing in the amount of $3,000,000 on June 15, 2020, $2,800,000 on June 15, 2021, $2,800,000 on June 15, 2022, $2,800,000 on June 15, 2023, $2,500,000 on June 15, 2024, $2,450,000 on June 15, 2025, $1,220,000 on June 15, 2026, The Bonds maturing on or after June 15, 2020 shall be subject to redemption prior to maturity as a whole or in part (and by lot if less than all of a maturity is to be redeemed) at the option of the County on June 15, 2019 or on any date thereafter at par, plus accrued interest to the date of redemption.

We have examined the Constitution and statutes of the State of New York and a certified copy of proceedings of the finance board of the Obligor and other proofs authorizing and relating to the issuance of the Obligations, including the form of the Obligations. In rendering the opinions expressed herein we have assumed the accuracy and truthfulness of all public records, documents and proceedings, including factual information, expectations and statements contained therein, examined by us which have been executed or certified by public officials acting within the scope of their official capacities, and have not verified the accuracy or truthfulness thereof. We also have assumed the genuineness of the signatures appearing upon such public records, documents and proceedings and the certifications thereof.

In our opinion:

(a) The Obligations have been authorized and issued in accordance with the Constitution and statutes of the State of New York and constitute valid and legally binding general obligations of the Obligor, all the taxable real property within which is subject to the levy of ad valorem taxes to pay the Obligations and interest thereon, without limitation as to rate or amount; provided, however, that the enforceability (but not the validity) of the Obligations: (i) may be limited by any applicable bankruptcy, insolvency or other law now existing or hereafter enacted by said State or the Federal government affecting the enforcement of creditors' rights, and (ii) may be subject to the exercise of judicial discretion in appropriate cases.

(b) Interest on the Obligations is not excluded from the gross income of the owners thereof for federal income tax purposes and is exempt from personal income taxes imposed by the State of New York or any political subdivision thereof (including The City of New York). We express no opinion regarding other tax consequences relating to the ownership or disposition of, or the accrual or receipt of interest on, the obligations.

The opinions expressed herein are based on an analysis of existing laws, regulations, rulings and court decisions and cover certain matters not directly addressed by such authorities. Such opinions may be affected by actions taken or omitted or events occurring after the date hereof. We have not undertaken to determine or to inform any person, whether any such actions are taken or omitted or events do occur or any other matters come to our attention after the date hereof. Our engagement with respect to the Obligations has concluded with their issuance, and we disclaim any obligation to update this opinion. We have assumed, without undertaking to verify, the accuracy of the factual matters represented, warranted or certified in the documents. We call attention to the fact that the rights and obligations under the Obligations and their enforceability may be subject to bankruptcy, insolvency, reorganization, arrangement, fraudulent conveyance, moratorium or other laws relating to or affecting creditors’ rights, to the application of equitable principles, to the exercise of judicial discretion in appropriate cases and to the limitations on legal remedies against municipal corporations such as the Obligor in the State of New York. We express no opinion with respect to any indemnification, contribution, penalty, choice of law, choice of forum, or waiver provisions contained in the foregoing documents.

The scope of our engagement in relation to the issuance of the Obligation has extended solely to the examination of the facts and law incident to rendering the opinions expressed herein. Such opinions are not intended and should not be construed to express or imply any conclusion that the amount of real property subject to taxation within the boundaries of the Obligor, together with other legally available sources of revenue, if any, will be sufficient to enable the Obligor to pay the principal of or interest on the Obligation as the same respectively become due and payable. We have not examined, reviewed or passed upon the accuracy, completeness or fairness of any factual information which may have been furnished to any purchaser of the Obligation by or on behalf of the Obligor and, accordingly, we express no opinion as to whether the Obligor, in connection with the sale of the Obligation, has made any untrue statement of a material fact or omitted to state a material fact necessary in order to make any statements made, in the light of the circumstances under which they were made, not misleading.

Very truly yours,

Orrick, Herrington & Sutcliffe LLP

APPENDIX - F

FORM OF BOND COUNSEL’S OPINION $4,905,000 General Obligation (Serial) Bonds, 2010

June 29, 2010

County of Onondaga, State of New York

Re: County of Onondaga, New York $4,905,000 General Obligation (Serial) Bonds, 2010 (Federally Taxable-Recovery Zone Bonds)

Ladies and Gentlemen:

We have been requested to render our opinion as to the validity of an issue of $4,905,000 General Obligation (Serial) Bonds, 2010 (Federally Taxable-Recovery Zone Bonds) (the "Obligations"), of the County of Onondaga, State of New York (the "Obligor"), dated June 29, 2010, initially issued in registered form in denominations such that one bond shall be issued for each maturity of bonds, in such amounts as hereinafter set forth, bearing interest at the rate of five and five tenths per centum (5.50%) per annum as to the bonds maturing in the year 2027, at the rate of five and seventy-five hundredths per centum (5.75%) per annum as to the bonds maturing in the year 2028, at the rate of five and eight hundred seventy-five thousandths per centum (5.875%) per annum as to the bonds maturing in the year 2029 and at the rate of five and nine tenths per centum (5.90%) per annum as to the bonds maturing in the year 2030, payable on June 15, 2011, December 15, 2011 and semi-annually thereafter on June 15 and December 15, and maturing in the amount of $1,225,000 on June 15, 2027 through and including June 15, 2029 and $1,230,000 on June 15, 2030. The Bonds maturing on or after June 15, 2020 shall be subject to redemption prior to maturity as a whole or in part (and by lot if less than all of a maturity is to be redeemed) at the option of the County on June 15, 2019 or on any date thereafter at par, plus accrued interest to the date of redemption.

We have examined the Constitution and statutes of the State of New York and a certified copy of proceedings of the finance board of the Obligor and other proofs authorizing and relating to the issuance of the Obligations, including the form of the Obligations. In rendering the opinions expressed herein we have assumed the accuracy and truthfulness of all public records, documents and proceedings, including factual information, expectations and statements contained therein, examined by us which have been executed or certified by public officials acting within the scope of their official capacities, and have not verified the accuracy or truthfulness thereof. We also have assumed the genuineness of the signatures appearing upon such public records, documents and proceedings and the certifications thereof.

In our opinion:

(a) The Obligations have been authorized and issued in accordance with the Constitution and statutes of the State of New York and constitute valid and legally binding general obligations of the Obligor, all the taxable real property within which is subject to the levy of ad valorem taxes to pay the Obligations and interest thereon, without limitation as to rate or amount; provided, however, that the enforceability (but not the validity) of the Obligations: (i) may be limited by any applicable bankruptcy, insolvency or other law now existing or hereafter enacted by said State or the Federal government affecting the enforcement of creditors' rights, and (ii) may be subject to the exercise of judicial discretion in appropriate cases.

(b) Interest on the Obligations is not excluded from the gross income of the owners thereof for federal income tax purposes and is exempt from personal income taxes imposed by the State of New York or any political subdivision thereof (including The City of New York). We express no opinion regarding other tax consequences relating to the ownership or disposition of, or the accrual or receipt of interest on, the obligations.

The opinions expressed herein are based on an analysis of existing laws, regulations, rulings and court decisions and cover certain matters not directly addressed by such authorities. Such opinions may be affected by actions taken or omitted or events occurring after the date hereof. We have not undertaken to determine or to inform any person, whether any such actions are taken or omitted or events do occur or any other matters come to our attention after the date hereof. Our engagement with respect to the Obligations has concluded with their issuance, and we disclaim any obligation to update this opinion. We have assumed, without undertaking to verify, the accuracy of the factual matters represented, warranted or certified in the documents. We call attention to the fact that the rights and obligations under the Obligations and their enforceability may be subject to bankruptcy, insolvency, reorganization, arrangement, fraudulent conveyance, moratorium or other laws relating to or affecting creditors’ rights, to the application of equitable principles, to the exercise of judicial discretion in appropriate cases and to the limitations on legal remedies against municipal corporations such as the Obligor in the State of New York. We express no opinion with respect to any indemnification, contribution, penalty, choice of law, choice of forum, or waiver provisions contained in the foregoing documents.

The scope of our engagement in relation to the issuance of the Obligation has extended solely to the examination of the facts and law incident to rendering the opinions expressed herein. Such opinions are not intended and should not be construed to express or imply any conclusion that the amount of real property subject to taxation within the boundaries of the Obligor, together with other legally available sources of revenue, if any, will be sufficient to enable the Obligor to pay the principal of or interest on the Obligation as the same respectively become due and payable. We have not examined, reviewed or passed upon the accuracy, completeness or fairness of any factual information which may have been furnished to any purchaser of the Obligation by or on behalf of the Obligor and, accordingly, we express no opinion as to whether the Obligor, in connection with the sale of the Obligation, has made any untrue statement of a material fact or omitted to state a material fact necessary in order to make any statements made, in the light of the circumstances under which they were made, not misleading.

Very truly yours,

Orrick, Herrington & Sutcliffe LLP