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TOWNSHIP OF JACKSON

AUDIT REPORT FOR THE YEAR ENDED DECEMBER 31, 2019

TOWNSHIP OF JACKSON COUNTY OF OCEAN

TABLE OF CONTENTS

EXHIBIT PAGE

PART I

• Independent Auditor’s Report
• Government Auditing Standards

Financial Statements – Regulatory Basis:

• Statements of Assets, Liabilities, Reserves & Fund Balance – Regulatory Basis A
• Statements of Operations and Changes in Fund Balance – Regulatory Basis A-1
• Statement of Revenues – Regulatory Basis A-2
• Statement of Expenditures – Regulatory Basis A-3
• Statements of Assets, Liabilities, Reserves & Fund Balance – Regulatory Basis B
• Statements of Operations and Changes in Fund Balance – Regulatory Basis B-1
• Statement of Revenues – Regulatory Basis B-2
• Statement of Expenditures – Regulatory Basis B-3
• Statements of Assets, Liabilities, Reserves & Fund Balance – Regulatory Basis C
• Statement of Fund Balance C-1
• Statements of Assets, Liabilities, Reserves & Fund Balance – Regulatory Basis D
• Statements of Fixed Assets & Fund Balance - Regulatory Basis E
• Statements of Assets & Liabilities - Regulatory Basis F
• Notes to Financial Statements

Supplemental Exhibits:

• Schedule of Cash & Cash Equivalents A-4
• Schedule of Due from State - P.L. 1971, C.20 A-5
• Schedule of Taxes Receivable & Analysis of Property Tax Levy A-6
• Schedule of Tax Title Liens A-7
• Schedule of Property Acquired for Taxes A-8
• Schedule of Revenue Accounts Receivable A-9
• Schedule of 2017 Appropriations Reserves A-10
• Schedule of Accounts Payable A-11

TOWNSHIP OF JACKSON COUNTY OF OCEAN

TABLE OF CONTENTS

• Schedule of Reserve for Encumbrances A-12
• Schedule of Prepaid Taxes A-13
• Schedule of Tax Overpayments A-14
• Schedule of County Taxes Payable A-15
• Schedule of Local School District Tax Payable A-16
• Schedule of Special District Taxes Payable A-17
• Schedule of Due to State of New Jersey – Construction Fees A-18
• Schedule of Due to State of New Jersey – Marriage Licenses A-19
• Schedule of Reserve for Revaluation Program A-20
• Schedule of Due to Municipal Open Space Trust Fund A-21
• Schedule of Reserve for Garden State Trust Fund A-22
• Schedule of Reserve for State Board of Taxation Appeals A-23
• Schedule of Reserve for Master Plan A-24
• Schedule of Reserve Other A-25
• Schedule of Reserve for COAH State Plan A-26
• Schedule of Reserve for FEMA Reimbursement A-27
• Schedule of Reserve for Police Cars A-28
• Schedule of Interfunds – Other Funds A-29
• Schedule of Federal & State Grant Fund Due from Current A-30
• Schedule of State & Federal Grants Receivable A-31
• Schedule of State & Federal Grants Appropriated A-32
• Schedule of State & Federal Grants Unappropriated A-33
• Schedule of Reserve for Encumbrances A-34
• Schedule of Cash - Treasurer B-4
• Schedule of Due to State of New Jersey – Animal Control B-5
• Schedule of Reserve for Animal Control Expenditures B-6
• Schedule of Interfund – Current Fund B-7
• Schedule of Due from County of Ocean – Community Development Block Grant B-8
• Schedule of Various Reserves B-9
• Schedule of Funds Held by Trustee - LOSAP B-10
• Schedule of Reserve for Length of Service Award Program B-11
• Schedule of Cash & Cash Equivalents C-2
• Analysis of Cash & Cash Investments C-3
• Schedule of Deferred Charges to Future Taxation – Funded C-4
• Schedule of Deferred Charges to Future Taxation – Unfunded C-5
• Schedule of General Serial Bonds C-6
• Schedule of Improvement Authorizations C-7
• Schedule of Reserve for Encumbrances C-8
• Schedule of Capital Improvement Fund C-9
• Schedule of Reserve for Debt Service - Open Space Bonds C-10
• Schedule of Reserve for Debt Service - Other C-11
• Schedule of Reserve for Fire Damage - Annex Building C-12
• Schedule of NJEIT Loan Payable C-13
• Schedule of Bond Anticipation Notes C-14
• Schedule of Bonds and Notes Authorized But Not Issued C-15

TOWNSHIP OF JACKSON COUNTY OF OCEAN

TABLE OF CONTENTS

• Schedule of Cash D-1
• Schedule of Reserve for Public Assistance D-2
• Schedule of Investment in Fixed Assets E-1

PART II

• Internal Control Over Compliance Required by NJ OMB Circular 15-08
• Schedule of Expenditures of State Financial Assistance Schedule 1
• Notes to Schedule of Expenditures of State Financial Assistance
• Schedule of Findings & Questioned Costs
• Prepared by Management

PART III

• Officials in Office and Surety Bonds
• General Comments
• Other Comments
• Recommendations
• Acknowledgement

TOWNSHIP OF JACKSON COUNTY OF OCEAN

PART I

INDEPENDENT AUDITOR'S REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

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INDEPENDENT AUDITOR'S REPORT

Honorable Mayor and Members of the Township Council Township of Jackson Jackson, New Jersey

Report on the Financial Statements

We have audited the accompanying statements of assets, liabilities, reserves and fund balance - regulatory basis of the various funds and account group of the Township of Jackson as of December 31, 2019 and 2018, and the related statements of operations and changes in the fund balance - regulatory basis for the years then ended, the related statements of revenues - regulatory basis, and statements of expenditures - regulatory basis for the year ended December 31, 2019 and the related notes to the financial statements, which collectively comprise the Township's basic financial statements as listed in the table of contents.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles and practices prescribed by the Division of Local Government Services, Department of Community Affairs, State of New Jersey. Management is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and in compliance with audit requirements prescribed by the Division of Local Government Services, Department of Community Affairs, State of New Jersey. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Opinions

Basis for Adverse Opinion on Accounting Principles Generally Accepted in the United States of America

As discussed in Note 1 to the financial statements, the Township prepares its financial statements using accounting practices that demonstrate compliance with regulatory basis of accounting and budget laws of the Division of Local Government Services, Department of Community Affairs, State of New Jersey, which is a basis of accounting other than accounting principles generally accepted in the United States of America, to meet the requirements of the State of New Jersey.

The effects on the financial statements of the variances between the regulatory basis of accounting described in Note 1 and accounting principles generally accepted in the United States of America, although not reasonably determinable, are presumed to be material.

Adverse Opinion on Accounting Principles Generally Accepted in the United States of America

In our opinion, because of the significance of the matter discussed in the “Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles” paragraph, the financial statements referred to above do not present fairly, in accordance with accounting principles generally accepted in the United States of America, the financial position of the Township, as of December 31, 2019 and 2018, or the results of its operations and changes in fund balance for the years then ended.

Unmodified Opinion on Regulatory Basis of Accounting

In our opinion, the financial statements referred to above present fairly, in all material respects, the assets, liabilities, reserves and fund balance - regulatory basis of the various funds of the Township, as of December 31, 2019 and 2018, and the results of its operations and changes in fund balance - regulatory basis of such funds for the years then ended, and the statements of revenues - regulatory basis, statements of expenditures - regulatory basis of the various funds, and general fixed assets group of accounts - regulatory basis, for the year ended December 31, 2019 in conformity with accounting principles and practices prescribed by the Division of Local Government Services, Department of Community Affairs, State of New Jersey as described in Note 1.

Other Matters

Other Information

Our audit was conducted for the purpose of forming opinions on the financial statements referred to in the first paragraph as a whole. The supplemental schedules presented for the various funds and letter of comments and recommendations section are presented for purposes of additional analysis as required by the Division of Local Government Services, Department of Community Affairs, State of New Jersey and is not a required part of the basic financial statements. The schedule of expenditures and state financial assistance is presented for purposes of additional analysis as required by New Jersey OMB's Circular 15-08, Single Audit Policy for Recipients of Federal Grants, State Grants and State Aid is also presented for purposes of additional analysis and is not a required part of the basic financial statements.

The supplemental schedules presented for the various funds and the schedule of expenditures of state financial assistance are the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. Such information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements of each of the respective individual funds and account group taken as a whole.

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The supplementary data and letter of comments and recommendations section has not been subject to the auditing procedures applied in the audit of the financial statements, and accordingly, we do not express an opinion or provide assurance on it.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated June 25, 2020 on our consideration of the Township's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on 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 in considering the Township's internal control over financial reporting and compliance.

Respectfully submitted,

HOLMAN FRENIA ALLISON, P.C.

Certified Public Accountant

Registered Municipal Accountant

RMA No. 435

Toms River, New Jersey

June 25, 2020

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INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

Honorable Mayor and Members of the Township Council Township of Jackson County of Ocean Jackson, New Jersey

We have audited, in accordance with the auditing standards generally accepted in the United States of America, the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States and audit requirements as prescribed by the Division of Local Government Services, Department of Community Affairs, State of New Jersey, the financial statements - regulatory basis of the Township of Jackson, as of and for the year ended December 31, 2019, and the related notes to the financial statements, which collectively comprise the Township's basic financial statements, and have issued our report thereon dated June 25, 2020. Our report indicated that the Township's financial statements were not prepared in accordance with accounting principles generally accepted in the United States of America but rather prepared in accordance with the regulatory basis of accounting prescribed by the Division of Local Government Services, Department of Community Affairs, State of New Jersey.

Internal Control Over Financial Reporting

In planning and performing our audit of the financial statements, we considered the Township's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Township's internal control. Accordingly, we do not express an opinion on the effectiveness of the Township's internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. We did identify certain

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deficiencies in internal control, described in the accompanying schedule of financial statement findings that we consider to be a significant deficiency as Finding No.'s 2019-001 & 2019-002.

Compliance and Other Matters

As part of obtaining reasonable assurance about whether the Township's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed instances of noncompliance or other matters that are required to be reported under Government Auditing Standards and audit requirements as prescribed by the Division of Local Government Services, Department of Community Affairs, State of New Jersey and which are described in the accompanying schedule of financial statement findings as Finding No.'s 2019-001 & 2019-002.

We also noted certain other matters that are not required to be reported under Governmental Auditing Standards, that we reported to management in the accompanying letter of comments and recommendations section of this report as required by the Division of Local Government Services, Department of Community Affairs, State of New Jersey.

Township of Jackson's Response to Findings

The Township of Jackson’s response to the findings identified in our audit is described in the accompanying schedule of financial statement findings. The Township’s response was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it.

Purpose of this Report

The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Township's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards and audit requirements as prescribed by the Division of Local Government Services, Department of Community Affairs, State of New Jersey in considering the Township's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Respectfully Submitted,

HOLMAN FRENIA ALLISON, P.C.

Certified Public Accountant

Registered Municipal Accountant

RMA No. 435

Toms River, New Jersey June 25, 2020

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BASIC FINANCIAL STATEMENTS

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TOWNSHIP OF JACKSON CURRENT FUND STATEMENTS OF ASSETS, LIABILITIES, RESERVES AND FUND BALANCE - REGULATORY BASIS DECEMBER 31, 2019 AND 2018

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

TOWNSHIP OF JACKSON CURRENT FUND STATEMENTS OF ASSETS, LIABILITIES, RESERVES AND FUND BALANCE - REGULATORY BASIS DECEMBER 31, 2019 AND 2018

REFERENCE 2019 2018

LIABILITIES RESERVES & FUND BALANCE

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

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TOWNSHIP OF JACKSON CURRENT FUND STATEMENTS OF OPERATIONS AND CHANGES IN FUND BALANCE FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

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TOWNSHIP OF JACKSON CURRENT FUND STATEMENT OF REVENUES FOR THE YEAR ENDED DECEMBER 31, 2019

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

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TOWNSHIP OF JACKSON CURRENT FUND STATEMENT OF REVENUES FOR THE YEAR ENDED DECEMBER 31, 2019

ANALYSIS OF REALIZED REVENUES

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

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TOWNSHIP OF JACKSON CURRENT FUND STATEMENT OF REVENUES FOR THE YEAR ENDED DECEMBER 31, 2019

ANALYSIS OF NONBUDGET REVENUE

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

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The Accompanying Notes to the Financial Statements are an integral part of this Statement.

APPROPRIATIONS EXPENDED CANCELLED

BUDGET BUDGET AFTER MODIFICATION PAID OR CHARGED ENCUMBERS RESERVED

OPERATIONS - Within "CAPS"

General Government:

Administrative Executive:

Salaries and Wages $281,586.77 $292,048.52 $282,457.97 $- $9,590.55 $-

Other Expenses 64,700.00 64,700.00 23,355.97 7,900.43 33,443.60 -

Township Council:

Salaries and Wages 44,340.00 44,340.00 43,534.21 - 805.79 -

Other Expenses 900.00 900.00 259.42 65.00 575.58 -

Mayor:

Salaries and Wages 29,500.00 29,500.00 29,499.96 - 0.04 -

Other Expenses 4,100.00 4,100.00 2,290.50 - 1,809.50 -

Human Services:

Salaries and Wages 110,495.71 109,995.71 91,289.29 - 18,706.42 -

Other Expenses 21,551.00 22,051.00 18,752.68 2,248.00 1,050.32 -

Municipal Clerk:

Salaries and Wages 274,080.69 286,130.36 263,926.98 2,373.63 19,829.75 -

Other Expenses 30,750.00 30,750.00 23,131.24 4,150.00 3,468.76 -

Election:

Salaries and Wages 3,500.00 3,500.00 3,046.77 - 453.23 -

Other Expenses 6,000.00 6,350.00 6,325.30 - 24.70 -

Financial Administration:

Salaries and Wages 344,825.82 357,761.04 331,487.23 2,558.51 23,715.30 -

Other Expenses 35,250.00 33,250.00 12,542.60 15,026.28 5,681.12 -

Audit Services:

Other Expenses 47,500.00 47,500.00 - 47,500.00 - -

Data Processing:

Salaries and Wages 123,613.57 135,701.74 135,099.55 - 602.19 -

Other Expenses 69,447.50 69,447.50 34,987.30 24,930.99 9,529.21 -

Collection of Taxes:

Salaries and Wages 305,230.03 313,413.88 308,744.95 4,668.93 - -

Other Expenses 39,385.00 39,385.00 19,651.61 5,085.33 14,648.06 -

Assessment of Taxes:

Salaries and Wages 378,018.17 380,128.43 368,814.18 6,517.54 4,796.71 -

Other Expenses 17,470.00 30,470.00 16,504.67 10,313.52 3,651.81 -

Purchasing:

Salaries and Wages 103,674.69 103,674.69 102,962.84 711.85 - -

Other Expenses 34,846.88 34,846.88 33,533.20 1,085.41 228.27 -

Legal Services & Costs:

Other Expenses 495,000.00 495,000.00 380,718.00 28,355.00 85,927.00 -

TOWNSHIP OF JACKSON CURRENT FUND STATEMENT OF EXPENDITURES FOR THE YEAR ENDED DECEMBER 31, 2019

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

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APPROPRIATIONS EXPENDED CANCELLED

BUDGET BUDGET AFTER MODIFICATION PAID OR CHARGED ENCUMBERS RESERVED

Engineering Services & Costs:

Salaries and Wages 207,492.15 142,363.15 140,261.48 481.67 1,620.00 -

Other Expenses 135,600.00 200,729.00 78,646.39 64,085.23 57,997.38 -

Historical Commission:

Other Expenses 100.00 100.00 - - 100.00 -

Community Alliance-Alcoholism & Drugs:

Salaries and Wages 1,140.00 1,140.00 - - 1,140.00 -

Other Expenses 100.00 100.00 - 100.00 - -

Mayor's Community Advisory Board:

Other Expenses 50.00 50.00 - - 50.00 -

Economic Development Advisory Board:

Other Expenses 1,175.00 1,175.00 - - 1,175.00 -

Land Use Administration:

Planning/Zoning Boards:

Salaries and Wages 236,559.49 242,182.70 236,474.58 2,417.49 3,290.63 -

Other Expenses 64,200.00 62,200.00 32,653.26 19,004.03 10,542.71 -

Maintenance of Tax Maps:

Other Expenses 20,000.00 11,000.00 767.50 - 10,232.50 -

Code Enforcement - Other:

Rent Leveling Board:

Salaries and Wages 3,145.00 3,145.00 900.00 - 2,245.00 -

Other Expenses 48,050.00 48,050.00 24,299.06 6,876.90 16,874.04 -

Code Enforcement - Other:

Salaries and Wages 318,202.24 320,921.12 309,538.47 1,856.77 9,525.88 -

Other Expenses 14,805.00 14,805.00 6,472.73 4,190.61 4,141.66 -

Commercial Building Standards:

Salaries and Wages 12,000.00 12,000.00 7,125.00 - 4,875.00 -

Other Expenses 1,100.00 1,100.00 213.00 292.74 594.26 -

Unsafe Structures Committee

Other Expenses 20,000.00 20,000.00 - - 20,000.00 -

Insurance:

General Liability 758,930.00 758,930.00 749,620.40 - 9,309.60 -

Workers Compensation 516,000.00 516,000.00 515,128.00 - 872.00 -

Employee Group Health 4,500,000.00 4,500,000.00 4,068,584.45 514.29 430,901.26 -

Health Benefit Waiver 44,160.00 43,160.00 36,000.00 - 7,160.00 -

Unemployment Trust Fund 10,000.00 10,000.00 - - 10,000.00 -

Public Safety Functions:

Police Department:

Salaries and Wages 12,021,571.60 12,026,887.32 11,502,605.48 9,041.62 515,240.22 -

Other Expenses 686,146.28 686,146.28 541,392.85 127,917.52 16,835.91 -

TOWNSHIP OF JACKSON CURRENT FUND STATEMENT OF EXPENDITURES FOR THE YEAR ENDED DECEMBER 31, 2019

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The Accompanying Notes to the Financial Statements are an integral part of this Statement.

APPROPRIATIONS EXPENDED CANCELLED

BUDGET BUDGET AFTER MODIFICATION PAID OR CHARGED ENCUMBERSERED RESERVED

Police Dispatch/911:

Salaries and Wages 571,565.33 581,632.58 460,023.40 - 121,609.18 -

Emergency Management:

Salaries and Wages 12,368.80 12,368.80 6,655.94 - 5,712.86 -

Other Expenses 20,500.00 20,500.00 4,499.31 - 16,000.69 -

Municipal Prosecutor:

Other Expenses 50,000.00 50,000.00 36,679.13 3,333.37 9,987.50 -

Juvenile Conference Committee:

Salaries and Wages 1,300.00 1,300.00 - - 1,300.00 -

Other Expenses 25.00 25.00 - - 25.00 -

Public Works Functions:

Streets & Roads Maintenance:

Salaries and Wages 1,547,509.18 1,543,176.17 1,441,865.73 2,316.50 98,993.94 -

Other Expenses 251,325.00 251,325.00 148,862.00 84,515.48 17,947.52 -

Snow Removal:

Other Expenses 400,000.00 330,000.00 310,660.77 19,339.23 - -

Shade Tree Commission:

Salaries and Wages 1,250.00 1,250.00 1,140.00 - 110.00 -

Other Expenses 7,550.00 7,550.00 4,928.60 193.50 2,427.90 -

Solid Waste Collection:

Salaries and Wages 151,524.62 153,128.69 132,721.51 - 20,407.18 -

Other Expenses 580,300.00 580,300.00 531,612.05 48,510.67 177.28 -

Buildings & Grounds:

Salaries and Wages 932,207.64 909,458.38 655,675.69 - 253,782.69 -

Other Expenses 201,500.00 231,500.00 159,594.19 57,389.13 14,516.68 -

Vehicle Maintenance:

Salaries and Wages 375,753.00 382,572.95 367,361.78 - 15,211.17 -

Other Expenses 264,050.00 264,050.00 179,380.21 60,677.73 23,992.06 -

Community Services Act:

Other Expenses 155,000.00 155,000.00 - 155,000.00 - -

Health & Human Services Functions:

Public Health Services:

Salaries and Wages 7,500.00 7,500.00 7,499.90 - 0.10 -

Other Expenses 800.00 800.00 531.00 - 269.00 -

Environmental Health Services-Environmental Commission:

Salaries and Wages 1,300.00 1,300.00 1,205.00 - 95.00 -

Other Expenses 425.00 425.00 34.56 - 390.44 -

TOWNSHIP OF JACKSON CURRENT FUND STATEMENT OF EXPENDITURES FOR THE YEAR ENDED DECEMBER 31, 2019

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

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APPROPRIATIONS EXPENDED CANCELLED

BUDGET BUDGET AFTER MODIFICATION PAID OR CHARGED ENCUMBERS RESERVED

Animal Control Services:

Salaries and Wages 145,524.84 149,322.86 131,001.13 3,792.04 14,529.69 -

Other Expenses 42,350.00 42,350.00 26,042.12 9,008.05 7,299.83 -

Going Green Committee:

Other Expenses 100.00 100.00 - - 100.00 -

Parks & Recreation Functions:

Recreation Services & Programs:

Salaries and Wages 145,086.18 147,495.44 129,853.35 1,680.41 15,961.68 -

Other Expenses 9,000.00 9,000.00 6,199.56 1,704.02 1,096.42 -

Office for the Golden Age:

Salaries and Wages 264,637.69 268,949.74 241,078.06 3,379.80 24,491.88 -

Other Expenses 24,975.00 24,975.00 20,337.37 2,868.96 1,768.67 -

Handicapped Committee:

Salaries and Wages 27,254.00 27,254.00 19,551.30 - 7,702.70 -

Other Expenses 7,300.00 7,300.00 4,371.42 - 2,928.58 -

Park Maintenance:

Other Expenses 23,000.00 93,000.00 22,369.46 67,995.26 2,635.28 -

Municipal Court Functions:

Municipal Court:

Salaries and Wages 364,514.00 366,079.05 297,628.20 4,128.21 64,322.64 -

Other Expenses 27,890.00 27,890.00 11,458.99 814.25 15,616.76 -

Public Defender:

Other Expenses 8,000.00 8,000.00 8,000.00 - - -

Other Common Operating Functions:

Salary & Wage Adjustment:

Salaries and Wages 164,220.00 19,029.55 - - 19,029.55 -

Postage & Photocopy:

Other Expenses 71,000.00 70,650.00 57,944.00 6,188.07 6,517.93 -

Accumulated Leave Compensation-Sick Trust:

Other Expenses 180,000.00 180,000.00 180,000.00 - - -

Utility Expenses & Bulk Purchases:

Electricity 449,000.00 449,000.00 269,449.92 106,270.40 73,279.68 -

Street Lighting 360,000.00 360,000.00 354,112.04 5,887.96 - -

Telecommunication Costs 60,000.00 60,000.00 45,476.05 681.88 13,842.07 -

Natural Gas 120,000.00 120,000.00 70,986.26 43,206.45 5,807.29 -

Fuel & Petroleum Products 575,000.00 575,000.00 281,149.60 101,045.76 192,804.64 -

Landfill/Solid Waste:

Landfill/Solid Waste Disposal Costs:

Other Expenses 227,000.00 252,000.00 211,635.09 40,190.82 174.09 -

TOWNSHIP OF JACKSON CURRENT FUND STATEMENT OF EXPENDITURES FOR THE YEAR ENDED DECEMBER 31, 2019

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

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TOWNSHIP OF JACKSON CURRENT FUND STATEMENT OF EXPENDITURES FOR THE YEAR ENDED DECEMBER 31, 2019

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The Accompanying Notes to the Financial Statements are an integral part of this Statement.

APPROPRIATIONS EXPENDED CANCELLED

BUDGET BUDGET AFTER MODIFICATION PAID OR CHARGED ENCUMBERSERED RESERVED

Relocation Assistance:

Other Expenses 2,000.00 2,000.00 - - 2,000.00 -

LOSAP 46,000.00 46,000.00 - 46,000.00 - -

Recycling Tonnage Tax 10,000.00 10,000.00 7,959.51 1,369.72 670.77 -

Shared Service Agreement-BOE/Police SRO 104,040.00 174,405.72 174,405.72 - - -

Supplemental Fire Services Programs:

Fire District Tax Obligations 13,026.00 13,026.00 13,026.00 - - -

Public & Private Programs Offset by Revenues:

OC Office of Senior Services-Information Assistance:

Salaries and Wages - 17,210.00 17,210.00 - - -

Other Expenses - 500.00 500.00 - - -

Safe & Secure Communities Program - 28,805.00 28,805.00 - - -

Municipal Alliance on Alcohol & Drug Abuse:

County Grant - 33,124.00 33,124.00 - - -

State of NJ Body Armor Grant 8,689.88 8,689.88 8,689.88 - - -

Clean Communities Grant - 119,496.35 119,496.35 - - -

Green Communities - 3,000.00 3,000.00 - - -

Drunk Driving Enforcement Fund 13,307.33 13,307.33 13,307.33 - - -

Matching Funds for Grants 18,281.00 18,281.00 11,281.00 - 7,000.00 -

Click It or Ticket - 5,500.00 5,500.00 - - -

Distracted Driving Crackdown - 5,500.00 5,500.00 - - -

Alcohol Education and Rehabilitation 4,174.25 4,174.25 4,174.25 - - -

Pedestrian Safety Grant - 6,270.00 6,270.00 - - -

COPS in Shops Summer Shore Initiative 4,400.00 4,400.00 4,400.00 - - -

Cops in Shops - Fall Initiative 4,840.00 4,840.00 4,840.00 - - -

Drive Sober or Get Pulled Over - 11,000.00 11,000.00 - - -

Federal Bureau of Justice Bulletproof Vest Partner - 6,965.59 6,965.59 - - -

NJDOT Municipal Aid Grant - 375,000.00 375,000.00 - - -

Homeland Security 18,000.00 18,000.00 18,000.00 - - -

Handicapped Recreation Opportunities Grant:

State Share - 15,000.00 15,000.00 - - -

Total Operations Excluded from "CAPS" 440,880.24 1,138,616.90 1,081,576.41 47,369.72 9,670.77 -

Detail:

Salaries and Wages 294,561.78 382,137.50 382,137.50 - - -

Other Expenses 146,318.46 756,479.40 699,438.91 47,369.72 9,670.77 -

TOWNSHIP OF JACKSON CURRENT FUND STATEMENT OF EXPENDITURES FOR THE YEAR ENDED DECEMBER 31, 2019

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

21

TOWNSHIP OF JACKSON CURRENT FUND STATEMENT OF EXPENDITURES FOR THE YEAR ENDED DECEMBER 31, 2019

TOWNSHIP OF JACKSON TRUST FUND STATEMENTS OF ASSETS, LIABILITIES, RESERVES AND FUND BALANCE - REGULATORY BASIS DECEMBER 31, 2019 AND 2018

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

22

TOWNSHIP OF JACKSON TRUST FUND STATEMENTS OF ASSETS, LIABILITIES, RESERVES AND FUND BALANCE - REGULATORY BASIS DECEMBER 31, 2019 AND 2018

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

23

TOWNSHIP OF JACKSON OPEN SPACE TRUST FUND STATEMENTS OF OPERATIONS AND CHANGES IN FUND BALANCE FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

24

TOWNSHIP OF JACKSON OPEN SPACE TRUST FUND STATEMENT OF REVENUES - REGULATORY BASIS FOR THE YEAR ENDED DECEMBER 31, 2019

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

25

26

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

TOWNSHIP OF JACKSON OPEN SPACE TRUST FUND STATEMENT OF EXPENDITURES - REGULATORY BASIS FOR THE YEAR ENDED DECEMBER 31, 2019

TOWNSHIP OF JACKSON GENERAL CAPITAL FUND STATEMENTS OF ASSETS, LIABILITIES, RESERVES AND FUND BALANCE - REGULATORY BASIS DECEMBER 31, 2019 AND 2018

There were Bonds & Notes Authorized but not issued on December 31, 2019 of $3,919,439.50 and on December 31, 2018 was $2,109,502.50.

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

27

TOWNSHIP OF JACKSON GENERAL CAPITAL FUND STATEMENT OF FUND BALANCE FOR THE YEAR ENDED DECEMBER 31, 2019

Balance December 31, 2019 and 2018

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

28

$ 114,061.99

TOWNSHIP OF JACKSON PUBLIC ASSISTANCE FUND STATEMENTS OF ASSETS AND RESERVES - REGULATORY BASIS DECEMBER 31, 2019 AND 2018

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

29

TOWNSHIP OF JACKSON GENERAL FIXED ASSETS ACCOUNT GROUP STATEMENTS OF GENERAL FIXED ASSETS AND FUND BALANCE - REGULATORY BASIS DECEMBER 31, 2019 AND 2018

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

30

TOWNSHIP OF JACKSON PAYROLL FUND STATEMENTS OF ASSETS AND LIABILITIES - REGULATORY BASIS DECEMBER 31, 2019 AND 2018

The Accompanying Notes to the Financial Statements are an integral part of this Statement.

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TOWNSHIP OF JACKSON COUNTY OF OCEAN

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

*****

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 1. Summary of Significant Accounting Policies

Description of Financial Reporting Entity

This report includes the financial statements of the Township of Jackson (the “Township”), within the County of Ocean, in the State of New Jersey and reflects the activities of the municipality which is under the control of the Mayor and Township Council. The financial statements of the Board of Education, First Aid Organization and Fire Districts are reported separately since their activities are administered by separate boards.

The Township’s governing body is also responsible for appointed the board members of the Jackson Municipal Utilities Authority, but the Township’s accountability for this organization does not extend beyond making the appointments.

Component Units - GASB Statement 14, as amended by GASB Statements 39, 61, 80, and 90, establishes criteria to be used in determining the component units, which should be included in the financial statements of a primary government. The financial statements of the Township are not presented in accordance with GAAP (as discussed below). Therefore, the Township had no component units as defined by GASB Statement No. 14, as amended by GASB Statements 39, 61, 80, and 90.

Basis of Accounting, Measurement Focus and Basis of Presentation - The financial statements of the Township contain all funds and account groups in accordance with the “Requirements of Audit” as promulgated by the State of New Jersey, Department of Community Affairs, Division of Local Government Services. The principles and practices established by the Requirements of Audit are designed primarily for determining compliance with legal provisions and budgetary restrictions and as a means of reporting on the stewardship of public officials with respect to public funds. Generally, the financial statements are presented using the flow of current financial resources measurement focus and modified accrual basis of accounting with minor exceptions as mandated by these “Requirements”. In addition, the prescribed accounting principles previously referred to differ in certain respects from accounting principles generally accepted in the United States of America applicable to local government units. The more significant differences are explained further in this note.

In accordance with the “Requirements”, the Township accounts for its financial transactions through the use of separate funds, which are described as follows:

Current Fund – This fund accounts for revenues and expenditures for governmental operations of a general nature, including federal and state grant funds.

Trust Funds – These funds account for receipts, custodianship and disbursement of funds in accordance with the purpose for which each reserve was created.

General Capital Fund – This fund accounts for receipt and disbursement of funds for the acquisition of general capital facilities, other than those acquired in the Current Fund.

Public Assistance Fund – This fund accounts for receipt and disbursement of funds that provide assistance to certain residents of the Township.

General Fixed Asset Account Group – The Fixed Asset Account Group of accounts is utilized to account for property, land, buildings, and equipment that have been acquired by other funds of the Township.

35

TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 1. Summary of Significant Accounting Policies (continued)

Payroll Fund – This fund accounts for the receipt and disbursements of funds used to meet obligations to employees and payroll tax liability.

Budgets and Budgetary Accounting - The Township must adopt an annual budget for its Current Fund in accordance with N.J.S.A.40A:4 et seq. N.J.S.A.40A:4-5 requires the governing body to introduce and approve the annual municipal budget no later than February 10th of each year. At introduction, the governing body must fix the time and place for a public hearing on the budget and must advertise the time and place at least ten days prior to the hearing in a newspaper published and circulating in the municipality. The public hearing must not be held less than twenty-eight days after the date the budget was introduced. After the hearing has been held, the governing body may, by majority vote, adopt the budget or may amend the budget in accordance with N.J.S.A.40A:4-9. Amendments to adopted budgets, if any are detailed in the statements of revenues and expenditures.

An extension of the statutory dates for introduction, approval and adoption of the municipal budget may be granted by the Director of Local Government Services, with the permission of the Local Finance Board. Budgets are adopted on the same basis of accounting utilized for the preparation of the Township’s financial statements. Once a budget is approved it may be amended after November 1, by a resolution adopted by the governing body.

Cash, Cash Equivalents and Investments - Cash and Cash equivalents include petty cash, change funds and cash on deposit with public depositories. All certificates of deposit are recorded as cash regardless of the date of maturity. Under GAAP, investments are reported at fair value but under regulatory basis of accounting, investments are stated at cost. Therefore, unrealized gains or losses on investments have not been recorded.

New Jersey municipal units are required by N.J.S.A.40A:5-14 to deposit public funds in a bank or trust company having its place of business in the State of New Jersey and organized under the laws of the United States or of the State of New Jersey or in the New Jersey Cash Management Fund. N.J.S.A.40A:5-15.1 provides a list of investments, which may be purchased by New Jersey municipal units. In addition, other State statutes permit investments in obligations issued by local utilities and other state agencies.

N.J.S.A.17:9-41 et seq. establishes the requirements for the security of deposits of governmental units. The statute requires that no governmental unit shall deposit public funds in a public depository unless such funds are secured in accordance with the Governmental Unit Deposit Protection Act, which was enacted in 1970 to protect governmental units from a loss of funds on deposit with a failed banking institution in New Jersey. Public depositories include State or federally chartered banks savings banks or associations located in or having a branch office in the State of New Jersey, the deposits of which are federally insured. All public depositories must pledge collateral, having a market value at least equal to five percent of the average daily balance of collected public funds, to secure the deposits of Governmental Units. If a public depository fails, the collateral it has pledged, plus the collateral of all other public depositories, is available to pay the amount of their deposits to the Governmental Units.

The cash management plan adopted by the Township requires it to deposit funds in public depositories protected from loss under the provisions of the Act.

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 1. Summary of Significant Accounting Policies (continued)

Interfunds - Interfund receivables and payables that arise from transactions between funds are recorded by all funds affected by such transactions in the period in which the transaction is executed. Interfund receivables in the Current Fund are recorded with offsetting reserves, which are created by charges to operations. Income is recognized in the year the receivables are liquidated. Interfund receivables in the other funds are not offset by reserves.

Inventories and Supplies - The cost of inventories of supplies for all funds are recorded as expenditures at the time individual items are purchased. The costs of inventories are not included on the various statements of assets, liabilities, reserves and fund balance.

General Fixed Assets – Accounting for governmental fixed assets, as required by N.J.A.C.5:30-5.6, differs in certain respects from accounting principles generally accepted in the United States of America. In accordance with the regulations, all local units, including municipalities, must maintain a general fixed assets reporting system that establishes and maintains a physical inventory of nonexpendable, tangible property as defined and limited by the U.S. Office of Management and Budget Circular A-87 (Attachment B, Section 19), except that the useful life of such property is at least five years. The Township has adopted a capitalization threshold of $5,000.00, the maximum amount allowed by the Circular. Generally, assets are valued at historical cost; however, assets acquired prior to December 31, 1985 are valued at actual historical cost or estimated historical cost. In some instances, assets are valued at the assessed valuation of the property at the time of acquisition, which approximates fair value. No depreciation of general fixed assets is recorded. Donated general fixed assets are recorded at their acquisition value as of the date of the transaction. Interest costs relative to the acquisition of general fixed assets are recorded as expenditures when paid. Public domain ("infrastructure") general fixed assets consisting of certain improvements such as roads, bridges, curbs and gutters, streets and sidewalks and drainage systems are not capitalized. Expenditures for construction in progress are recorded in the capital funds until such time as the construction is completed and put into operation. The Township is required to maintain a subsidiary ledger detailing fixed assets records to control additions, retirements, and transfers of fixed assets. In addition, a statement of general fixed assets, reflecting the activity for the year, must be included in the Township's basic financial statements.

The regulations require that general fixed assets, whether constructed or acquired through purchase, grant or gift be included in the aforementioned inventory. In addition, property management standards must be maintained that includes accurate records indicating asset description, source, ownership, acquisition cost and date, the percentage of federal participation (if any), and the location, use, and condition of the asset. Periodically, physical inventories must be taken and reconciled with these records. All fixed assets must be adequately controlled to safeguard against loss, damage, or theft.

Foreclosed property – Foreclosed Property or “Property Acquired for Taxes” is recorded in the Current Fund at the assessed valuation when such property was acquired and is fully reserved. Ordinarily it is the intention of the Township to resell foreclosed property in order to recover all or a portion of the delinquent taxes or assessments and to return the property to a taxpayer basis. For this reason, the value of foreclosed property has not been included in the General Fixed Assets Account Group. If such property is converted to a municipal use, it will be recorded in the General Fixed Assets Account Group.

Deferred Charges – The recognition of certain expenditures is deferred to future periods. These expenditures or deferred charges are generally overexpenditures of legally adopted budget appropriations or emergency appropriations made in accordance with N.J.S.A.40A:4-46 et seq. Deferred charges are subsequently raised as items of appropriation in budgets of succeeding years.

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 1. Summary of Significant Accounting Policies (continued)

Fund Balance – Fund Balance included in the Current Fund represent the amount available for anticipation as revenue in future year's budgets, with certain restrictions.

Revenues – are recorded when received in cash except for certain amounts, which are due from other governmental units. Revenue from Federal and State grants are realized when anticipated as such in the Township’s budget. Receivables for property taxes are recorded with offsetting reserves on the statement of assets, liabilities, reserves and fund balance of the Township’s Current Fund; accordingly, such amounts are not recorded as revenue until collected. Other amounts that are due the Township, which are susceptible to accrual are also recorded as receivables with offsetting reserves and recorded as revenues when received.

Property Tax Revenues – are collected in quarterly installments due February 1, May 1, August 1 and November 1. The amount of tax levied includes not only the amount required in support of the Township’s annual budget, but also the amounts required in support of the budgets of the County of Ocean and the Township of Jackson School District. Unpaid property taxes are subject to tax sale in accordance with statutes.

County Taxes – The municipality is responsible for levying, collecting and remitting County taxes for the County of Ocean. Operations is charged for the amount due the County for the year, based upon the ratables required to be certified to the County Board of Taxation by January 10th of the current year. In addition, operations is charged for the County share of Added and Omitted Taxes certified to the County Board of Taxation by October 10th of the current year and due to be paid to the County by February 15th of the following year.

School Taxes – The municipality is responsible for levying, collecting and remitting school taxes for the Township of Jackson School District. Operations are charged for the full amount required to be raised from taxation to operate the local school district July 1 to June 30.

Deferred School Taxes – School taxes raised in advance in the Current Fund for a school fiscal year (July 1 to June 30) which remain unpaid at December 31 of the calendar year levied may be deferred to fund balance to the extent of not more than 50% of the annual levy providing no requisition has been made by the school district for such amount.

Reserve for Uncollected Taxes – The inclusion of the “Reserve for Uncollected Taxes” appropriation in the Township’s annual budget protects the Township from taxes not paid currently. The Reserve, the minimum amount of which is determined on the percentage of collections experienced in the immediate preceding year, with certain exceptions, is required to provide assurance that cash collected in the current year will provide sufficient cash flow to meet expected obligations.

Expenditures – are recorded on the “budgetary” basis of accounting. Generally, expenditures are recorded when an amount is encumbered through the issuance of a numerically controlled purchase order or when a contract is executed as required by Technical Accounting Directive No. 85-1. When an expenditure is paid, the amount encumbered is simultaneously liquidated in its original amount. Encumbrances are offset by an account entitled to reserve for encumbrances. The reserve is classified as a cash liability under New Jersey municipal accounting. At December 31, this reserve represents the portion of appropriation reserves that has been encumbered and is subject to the same statutory provisions as appropriation reserves. Appropriations for interest payments on outstanding general capital bonds and notes are provided on the cash basis.

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 1. Summary of Significant Accounting Policies (continued)

Appropriation Reserves – Appropriation reserves covering unexpended appropriation balances are automatically created at year-end and recorded as liabilities, except for amounts, which may be cancelled by the governing body. Appropriation reserves and reserve for encumbrances at current year end are available until December 31st of the succeeding year to meet specific claims, commitments or contracts incurred during the preceding year. Any unspent balances at this time are lapsed appropriation reserves and recorded as income.

Long-Term Debt - Long-Term Debt relative to the acquisition of capital assets, is recorded as a liability in the General Capital Fund. Where an improvement is a “local improvement”, i.e. assessable upon completion, long-term debt associated with that portion of the cost of the improvement to be funded by assessments is transferred to the Trust Fund upon the confirmation of the assessments or when the improvement is fully and permanently funded.

Compensated Absences – Expenditures relating to obligations for unused vested accumulated vacation and sick leave are not recorded until paid; however, municipalities may establish and budget reserve funds subject to NJSA 40A:4-39 for the future payment of compensated absences.

Recent Accounting Pronouncements – The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. GASB adopts accounting statements to be used by governmental units when reporting financial position and results of operations in accordance with accounting principles generally accepted in the United States of America (GAAP). The municipalities in the State of New Jersey do not prepare their financial statements in accordance with GAAP and thus do not comply with all of the GASB pronouncements. The following GASB pronouncement effective for the current year did have a significant impact on the Township’s financial statements.

Statement No. 91, Conduit Debt Obligations, provides a single method of reporting conduit debt obligations by issuers and eliminates diversity in practice associated with (1) commitments extended by issuers, (2) arrangements associated with conduit debt obligations, and (3) related note disclosures. In accordance with GASB Statement 95 noted below the requirements of this Statement will be effective for reporting periods subsequent to the date of this report. Management does not expect this Statement to have a material impact to the Municipality’s financial statements.

Statement No. 95, Postponement of The Effective Dates of Certain Authoritative Guidance, provides temporary relief to governments and other stakeholders in light of the COVID-19 pandemic. That objective is accomplished by postponing the effective dates of certain provisions in Statements and Implementation Guides that first became effective or are scheduled to become effective for periods beginning after June 15, 2018, and later.

Note 2. Deposits and Investments

The Township is governed by the deposit and investment limitations of New Jersey state law.

Deposits

Custodial Credit Risk Related to Deposits - Custodial credit risk is the risk that, in the event of a bank failure, the Township's deposits may not be returned. Although the Township does not have a formal policy regarding custodial credit risk, NJSA 17:9-41 et seq. requires that the governmental units shall deposit public funds in public depositories protected from loss under the provisions of the Governmental

39

TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 2. Deposits and Investments (continued)

Unit Deposit Protection Act (GUDPA). GUDPA is a supplemental insurance program set forth by the New Jersey Legislature to protect the deposits of local governmental agencies. The program is administered by the Commissioner of the New Jersey Department of Banking and Insurance. Under the Act, the first $250,000 of governmental deposits in each insured depository is protected by FDIC. Public funds owned by the Township in excess of FDIC insured amounts are protected by GUDPA. However,

GUDPA does not protect intermingled trust funds such as salary withholdings, bail funds or funds that may pass to the Township relative to the happening of a future condition. Such funds are shown as Uninsured and Uncollateralized in the schedule below.

As of December 31, 2019, the Township’s bank balance of $45,677,500.02 was insured or collateralized as follows:

Investments

Fair Value Measurement – The fair value measurements of investments are required to be reported based on the hierarchy established by generally accepted accounting principles. Under GAAP, investments are required to be categorized based on the fair value of inputs of Levels 1, 2 and 3. Under Level 1 inputs, investments are required to be categorized based on quoted market prices in active markets for identical investments. Level 2 inputs are based primarily on using observable measurement criteria, including quoted market prices of similar investments in active and inactive markets and other observable corroborated factors. Level 3 inputs are assets measured at fair value on a recurring basis using significant unobservable measurement criteria based on the best information available.

Under regulatory basis of accounting, investments are measured at cost in the Township’s financial statements. However, had the financial statements been prepared in accordance with GAAP, the Township’s fair value, hierarchy level and maturities of its investments at December 31, 2019 would be as followed:

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 2. Deposits and Investments (continued)

Custodial credit risk related to Investments - This is the risk that in the event of the failure of the counterparty (e.g., broker-dealer) to a transaction, the Township will not be able to recover the value of its investment or collateral securities that are in the possession of another party. Other than the rules and regulations promulgated by N.J.S.A. 40A:5-15.1, the Township has no investment policy to limit exposure to custodial credit risk.

Interest rate risk - This is the risk that changes in interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. Other than the rules and regulations promulgated by N.J.S.A. 40A:5-15.1, the Township does not have a formal investment policy that limits investment maturities as a means of managing its exposure to fair value losses arising from increasing interest rates.

Credit risk - Credit risk is the risk that an issuer to an investment will not fulfill its obligation to the holder of the investment. This is measured by assignment of a rating by a nationally recognized rating organization. U.S. Government securities or obligations explicitly guaranteed by the U.S. government are not considered to have credit risk exposure. As of December 31, 2019, the Township’s investments had the following ratings:

Concentration of Credit Risk – Concentration of credit risk is the risk of loss attributed to the magnitude of a government’s investment in a single issuer. Other than the rules and regulations promulgated by N.J.S.A. 40A; 5-15.1, the Township’s investment policies place no limit in the amount the Township may invest in any one issuer. More than 5% of the Township’s investments are in mutual funds and fixed account investment contract. These investments represent 100% of the Township’s total investments.

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 3. Property Taxes

The following is a three-year comparison of certain statistical information relative to property taxes and property tax collections for the current and previous two years.

Assessed Valuation

Comparison of Tax Levies and Collections

Delinquent Taxes and Tax Title Liens

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 3. Property Taxes (continued)

The last tax sale was held on October 4, 2019.

Note 4. Property Acquired By Tax Title Lien Liquidation

The value of properties acquired by liquidation of tax title liens based on the last assessed valuation of such properties as of December 31, was as follows:

Year Amount

2019 $ 6,251,500.00

2018 6,306,200.00

2017 6,306,200.00

Note 5. Fund Balances Appropriated

The following schedule details the amount of fund balances available at the end of the current year and four previous years and the amounts utilized in the subsequent year's budgets:

Note 6. Disaggregated Receivable and Payable Balances

There are no significant components of receivable and payable balances reported in the financial statements.

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 7. Interfund Receivables, Payables and Transfers

The following interfund balances were recorded in the various statements of assets liabilities, reserves and fund balances at December 31, 2019:

The interfund receivables and payables above predominately resulted from payment made by certain funds on behalf of other funds. All interfund balances are expected to be repaid within one year.

Note 8. Fixed Assets

The following is a summary of changes in the General Fixed Assets Account Group for the year ended December 31, 2019.

Balance December 31, Balance December 31,

2018 Additions Deletions 2019

Land $ 56,320,100.00 $ - - - $ 56,320,100.00

Buildings and Improvements 49,798,905.00 530,857.00 - - 50,329,762.00

Machinery & Equipment 14,296,035.00 605,269.00 263,920.00 - 14,637,384.00

$ 120,415,040.00 $ 1,136,126.00 $ 263,920.00 $ 121,287,246.00

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations

A. Public Employees' Retirement System (PERS)

Plan Description - The State of New Jersey, Public Employees' Retirement System (PERS) is a cost-sharing multiple-employer defined benefit pension plan administered by the State of New Jersey, Division of Pensions and Benefits (the Division). For additional information about PERS, please refer to Division's Comprehensive Annual Financial Report (CAFR) which can be found at http://www.state.nj.us/treasury/pensions/annual-reports.shtml.

The vesting and benefit provisions are set by N.J.S.A. 43:15A. PERS provides retirement, death and disability benefits. All benefits vest after ten years of service.

The following represents the membership tiers for PERS:

Tier Definition 1 Members who were enrolled prior to July 1, 2007 2 Members who were eligible to enroll on or after July 1, 2007 and prior to November 2, 2008 3 Members who were eligible to enroll on or after November 2, 2008 and prior to May 22, 2010 4 Members who were eligible to enroll on or after May 22, 2010 and prior to June 28, 2011 5 Members who were eligible to enroll on or after June 28, 2011

Service retirement benefits of 1/55th of final average salary for each year of service credit is available to tiers 1 and 2 members upon reaching age 60 and to tier 3 members upon reaching age 62. Service retirement benefits of 1/60th of final average salary for each year of service credit is available to tier 4 members upon reaching age 62 and tier 5 members upon reaching age 65. Early retirement benefits are available to tiers 1 and 2 members before reaching age 60, tiers 3 and 4 with 25 or more years of service credit before age 62 and tier 5 with 30 or more years of service credit before age 65. Benefits are reduced by a fraction of a percent for each month that a member retires prior to the age at which a member can receive full early retirement benefits in accordance with their respective tier. Tier 1 members can receive an unreduced benefit from age 55 to age 60 if they have at least 25 years of service. Deferred retirement is available to members who have at least 10 years of service credit and have not reached the service retirement age for the respective tier.

Basis of Presentation - The schedules of employer and nonemployer allocations and the schedules of pension amounts by employer and nonemployer (collectively, the Schedules) present amounts that are considered elements of the financial statements of PERS or its participating employers. Accordingly, they do not purport to be a complete presentation of the financial position or changes in financial position of PERS or the participating employers. The accompanying Schedules were prepared in accordance with U.S. generally accepted accounting principles. Such preparation requires management of PERS to make a number of estimates and assumptions relating to the reported amounts. Due to the inherent nature of these estimates, actual results could differ from those estimates.

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

A. Public Employees' Retirement System (PERS) (continued):

Contributions - The contribution policy for PERS is set by N.J.S.A. 43:15A and requires contributions by active members and contributing employers. State legislation has modified the amount that is contributed by the State. The State's pension contribution is based on an actuarially determined amount, which includes the employer portion of the normal cost and an amortization of the unfunded accrued liability. Funding for noncontributory group insurance benefits is based on actual claims paid. For the fiscal year 2019, the State's pension contribution was less than the actuarial determined amount. The local employers' contribution amounts are based on an actuarially determined rate, which includes the normal cost and unfunded accrued liability. Chapter 19, P.L. 2009 provided an option for local employers of PERS to contribute 50% of the normal and accrued liability contribution amounts certified for payments due in State fiscal year 2009. Such employers will be credited with the full payment and any such amounts will not be included in their unfunded liability. The actuaries will determine the unfunded liability of those retirement systems, by employer, for the reduced normal and accrued liability contributions provided under this law. This unfunded liability will be paid by the employer in level annual payments over a period of 15 years beginning with the payments due in the fiscal year ended June 30, 2012 and will be adjusted by the rate of return on the actuarial value of assets. For the year ended December 31, 2019, the Township's contractually required contribution to PERS plan was $987,000.

Components of Net Pension Liability - At December 31, 2019, the Township’s proportionate share of the PERS net pension liability was $18,283,277.00. The net pension liability was measured as of June 30, 2019. The total pension liability used to calculate the net pension liability was determined using update procedures to roll forward the total pension liability from an actuarial valuation as of July 1, 2018, which was rolled forward to June 30, 2019. The Township’s proportion of the net pension liability was based on the Township’s actual contributions to the plan relative to the total of all participating employers’ contributions for the year ended June 30, 2019. The Township’s proportion measured as of June 30, 2019, was 0.1014695676% which was an increase of 0.0013170476% from its proportion measured as of June 30, 2018.

Balances at December 31, 2019 and December 31, 2018

46

TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

A. Public Employees' Retirement System (PERS) (continued):

Pension Expense and Deferred Outflows/Inflows of Resources - At December 31, 2019, the Township’s proportionate share of the PERS expense, calculated by the plan as of the June 30, 2019 measurement date is $1,140,327.00. This expense is not recognized by the Township because of the regulatory basis of accounting as described in Note 1, but as previously mentioned the Township contributed $987,000 to the plan in 2019.

At December 31, 2019, the Township reported deferred outflows of resources and deferred inflows of resources related to PERS from the following sources:

The Township will amortize the above sources of deferred outflows and inflows related to PERS over the following number of years:

47

TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

A. Public Employees' Retirement System (PERS) (continued):

48

TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

A. Public Employees' Retirement System (PERS) (continued):

The following is a summary of the deferred outflows of resources and deferred inflows of resources related to PERS that will be recognized in future periods:

Actuarial Assumptions - The total pension asset/(liability) as of the measurement date was determined by using an actuarial valuation as noted in the table below, with update procedures used to roll forward the total pension liability to the measurement date. The actuarial valuations used the following actuarial assumptions:

Pre-retirement mortality rates were based on the Pub-2010 General Below-Median Income Employee Mortality Table with an 82.2% adjustment for males and 101.4% adjustment for females, and with future improvement from the base year of 2010 on a generational basis. Post-retirement mortality rates were based on the Pub-2010 General Below-Median Income Healthy Retiree mortality table with a 91.4% adjustment for males and 99.7% adjustment for females, and with future improvement from the base year of 2010 on a generational basis. Disability retirement rates used to value disabled retirees were based on the Pub-2010 Non-Safety Disabled Retiree mortality table with a 127.7% adjustment for males and 117.2% adjustment for females, and with future improvement from the base year of 2010 on a generational basis. Mortality improvement is based on Scale MP-2019.

49

TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

A. Public Employees' Retirement System (PERS) (continued):

The actuarial assumptions used in the July 1, 2018 valuation were based on the results of an actuarial experience study for the period July 1, 2014 to June 30, 2018. It is likely that future experience will not exactly conform to these assumptions. To the extent that actual experience deviates from these assumptions, the emerging liabilities may be higher or lower than anticipated. The more the experience deviates, the larger the impact on future financial statements.

Long-Term Expected Rate of Return - In accordance with State statute, the long-term expected rate of return on plan investments (7.00% at June 30, 2019) is determined by the State Treasurer, after consultation with the Directors of the Division of Investments and Division of Pensions and Benefits, the board of trustees and the actuaries. The long-term expected rate of return was determined using a building block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic rates of return for each major asset class included in PERS's target asset allocation as of June 30, 2019 are summarized in the following table:

Discount Rate - The discount rate used to measure the total pension liability was 6.28% as of June 30, 2019. The single blended discount rate was based on long-term expected rate of return on pension plan investments of 7.00%, and a municipal bond rate of 3.50% as of June 30, 2019 based on the Bond Buyer Go 20-Bond Municipal Bond Index, which includes tax-exempt general obligation municipals bonds with an average rating of AA/Aa or higher. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be based on 70% of the actuarially determined contributions for the State employer and 100% of actuarially determined contributions for the local employers. Based on those assumptions, the plan’s fiduciary net position was projected to be available to make projected future

50

TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

A. Public Employees' Retirement System (PERS) (continued):

benefit payments of current plan members through 2057. Therefore, the long-term expected rate of return on plan investments was applied to projected benefit payments through 2057 and the municipal bond rate was applied to projected benefit payments after that date in determining the total pension liability.

Sensitivity of the Township’s proportionate share of the Net Pension Liability to Changes in the Discount Rate - The following presents the Township’s proportionate share of the net pension liability calculated using the discount rate as disclosed above, as well as what the Township’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (5.28%) or 1-percentage-point higher (7.28%) than the current rate:

B. Police and Firemen's Retirement System (PFRS)

Plan Description – The State of New Jersey, Police and Firemen's Retirement System (PFRS) is a cost-sharing multiple-employer defined benefit pension plan administered by the State of New Jersey, Division of Pensions and Benefits (the Division). For additional information about PFRS, please refer to the Division's Comprehensive Annual Financial Report (CAFR) which can be found at http://www.state.nj.us/treasury/pensions/annual-reports.shtml.

The vesting and benefit provisions are set by N.J.S.A. 43:16A. PFRS provides retirement as well as death and disability benefits. All benefits vest after ten years of service, except disability benefits which vest after four years of service.

The following represents the membership tiers for PFRS:

Tier

1 Members who were enrolled prior to May 22, 2010.

2 Members who were eligible to enroll on or after May 22, 2010 and prior to June 28, 2011

3 Members who were eligible to enroll on or after June 28, 2011

Definition

Service retirement benefits are available at age 55 and are generally determined to be 2% of final compensation for each year of creditable service, as defined, up to 30 years plus 1% for each year of service in excess of 30 years. Members may seek special retirement after achieving 25 years of creditable service, in which benefits would equal 65% (tiers 1 and 2 members) and 60% (tier 3 members) of final compensation plus 1% for each year if creditable service over 25 years but not to exceed 30 years. Members may elect deferred retirement benefits after achieving ten years of service, in which case benefits would begin at age 55 equal to 2% of final compensation for each year of service.

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

B. Police and Firemen's Retirement System (PFRS) (continued):

Basis of Presentation - The schedule of employer and nonemployer allocations and the schedule of pension amounts by employer and nonemployer (collectively, the Schedules) present amounts that are considered elements of the financial statements of PFRS, its participating employers or the State as a nonemployer contributing entity. Accordingly, they do not purport to be a complete presentation of the financial position or changes in financial position of PFRS, the participating employers, or the State. The accompanying Schedules were prepared in accordance with U.S. generally accepted accounting principles. Such preparation requires management of PFRS to make a number of estimates and assumptions relating to the reported amounts. Due to the inherent nature of these estimates, actual results could differ from those estimates.

Contributions - The contribution policy for PFRS is set by N.J.S.A. 43:16A and requires contributions by active members and contributing employers. State legislation has modified the amount that is contributed by the State. The State's contribution amount is based on an actuarially determined rate which includes the normal cost and unfunded accrued liability. For fiscal year 2019, the State contributed an amount less than the actuarially determined amount. The Local employers' contribution amounts are based on an actuarially determined rate which includes the normal cost and unfunded accrued liability. Chapter 19, P.L. 2009 provided an option for local employers of PFRS to contribute 50% of the normal and accrued liability contribution amounts certified for payments due in State fiscal year 2009. Such employers will be credited with the full payment and any such amounts will not be included in their unfunded liability. The actuaries will determine the unfunded liability of those retirement systems, by employer, for the reduced normal and accrued liability contributions provided under this law. This unfunded liability will be paid by the employer in level annual payments over a period of 15 years beginning with the payments due in the fiscal year ended June 30, 2012 and will be adjusted by the rate of return on the actuarial value of assets. For the year ended December 31, 2019, the Township's contractually required contributions to PFRS plan was $2,981,857.

Net Pension Liability and Pension Expense - At December 31, 2019 the Township’s proportionate share of the PFRS net pension liability was $36,126,169. The net pension liability was measured as of June 30, 2019. The total pension liability used to calculate the net pension liability was determined using update procedures to roll forward the total pension liability from an actuarial valuation as of July 1, 2018, to the measurement date of June 30, 2019. The Township’s proportion of the net pension liability was based on the Township’s actual contributions to the plan relative to the total of all participating employers’ contributions for the year ended June 30, 2019. The Township’s proportion measured as of June 30, 2019, was 0.2952010415%, which was an increase of 0.0087942867% from its proportion measured as of June 30, 2018.

Balances at December 31, 2019 and December 31, 2018

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

B. Police and Firemen's Retirement System (PFRS) (continued):

Pension Expense and Deferred Outflows/Inflows of Resources – At December 31, 2019, the Township’s proportionate share of the PFRS expense, calculated by the plan as of the June 30, 2019 measurement date was $4,013,467. This expense is not recognized by the Township because of the regulatory basis of accounting as described in Note 1, but as previously mentioned the Township contributed $2,981,857 to the plan in 2019.

At December 31, 2019, the Township had deferred outflows of resources and deferred inflows of resources related to PFRS from the following sources:

Differences between Expected and Actual Experience $ 304,951 $ 228,721

Deferred Outflows of Resources Deferred Inflows of Resources

Changes of Assumptions 1,237,879 11,675,647

Net Difference between Projected and Actual Earnings on Pension Plan Investments - 489,498

Changes in Proportion and Differences between Township Contributions and Proportionate Share of Contributions 1,600,475 125,186

$ 3,143,305 $ 12,519,052

The Township will amortize the above sources of deferred outflows and inflows related to PFRS over the following number of years:

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

B. Police and Firemen's Retirement System (PFRS) (continued):

54

TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

B. Police and Firemen's Retirement System (PFRS) (continued):

The following is a summary of the deferred outflows of resources and deferred inflows of resources related to PFRS that will be recognized in future periods:

Year Ending

Special Funding Situation – Under N.J.S.A. 43:16A-15, local participating employers are responsible for their own contributions based on actuarially determined amounts, except where legislation was passed which legally obligated the State if certain circumstances occurred. The legislation which legally obligates the state is as follows: Chapter 8, P.L. 2000, Chapter 318, P.L. 2001, Chapter 86, P.L. 2001, Chapter 511, P.L., 1991, Chapter 109, P.L. 1979, Chapter 247, P.L. 1993 and Chapter 201, P.L. 2001. The amounts contributed on behalf of the local participating employers under this legislation is considered to be a special funding situation as defined by GASB Statement No. 68 and the State is treated as a non-employer contributing entity. Since the local participating employers do not contribute under this legislation directly to the plan (except for employer specific financed amounts), there is no net pension liability to report in the financial statements of the local participating employers related to this legislation.

Additionally, the State’s proportionate share of the PFRS net pension liability attributable to the Township is $5,704,391 as of December 31, 2019. The net pension liability was measured as of June 30, 2019. The total pension liability used to calculate the net pension liability was determined using update procedures to roll forward the total pension liability from an actuarial valuation as of July 1, 2018, to the measurement date of June 30, 2019. The State’s proportion of the net pension liability associated with the Township was based on a projection of the Township’s long-term share of contributions to the pension plan relative to the projected contributions of all participating members, actuarially determined. The State’s proportion measured as of June 30, 2019 was 0.2952010415%, which was an increase of 0.0087942867% from its proportion measured as of June 30, 2018, which is the same proportion as the Township’s. At December 31, 2019, the Township’s and the State of New Jersey’s proportionate share of the PFRS net pension liability were as follows:

Township's Proportionate Share of Net Pension Liability $ 36,126,169

State of New Jersey's Proportionate Share of Net Pension Liability Associated with the Township 5,704,391

5,704,391 $41,830,560

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

B. Police and Firemen's Retirement System (PFRS) (continued):

At December 31, 2019, the State’s proportionate share of the PFRS expense, associated with the Township, calculated by the plan as of the June 30, 2019 measurement date was $662,803.

Actuarial Assumptions - The total pension asset/(liability) as of the measurement date was determined by using an actuarial valuation as noted in the table below, with update procedures used to roll forward the total pension liability to the measurement date. The actuarial valuations used the following actuarial assumptions:

Pre-retirement mortality rates were based on the Pub-2010 Safety Employee mortality table with a 105.6% adjustment for males and 102.5% adjustment for females, and with future improvement from the base year of 2010 on a generational basis. Post-retirement mortality rates were based on the Pub-2010 Safety Retiree Below-Median Income Weighted mortality table with a 96.7% adjustment for males and 96.0% adjustment for females, and with future improvement from the base year of 2010 on a generational basis. For beneficiaries (contingent annuitants), the Pub-2010 General Retiree Below-Median Income Weighted mortality table was used, unadjusted, and with future improvement from the base year of 2010 on a generational basis. Disability rates were based on the Pub-2010 Safety Disabled Retiree mortality table with a 152.0% adjustment for males and 109.3% adjustment for females, and with future improvement from the base year of 2010 on a generational basis. Mortality improvement is based on Scale MP-2019.

The actuarial assumptions used in the July 1, 2018 valuation were based on the results of an actuarial experience study for the period July 1, 2013 to June 30, 2018.

56

TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

B. Police and Firemen's Retirement System (PFRS) (continued):

Long-Term Expected Rate of Return - In accordance with State statute, the long-term expected rate of return on plan investments (7.00% at June 30, 2019) is determined by the State Treasurer, after consultation with the Directors of the Division of Investments and Division of Pensions and Benefits, the board of trustees and the actuaries. The long-term expected rate of return was determined using a building block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic rates of return for each major asset class included in PFRS's target asset allocation as of June 30, 2019 are summarized in the following table:

Discount Rate - The discount rate used to measure the total pension liability was 6.85% as of June 30, 2019. The single blended discount rate was based on long-term expected rate of return on pension plan investments of 7.00%, and a municipal bond rate of 3.50% as of June 30, 2019 based on the Bond Buyer Go 20-Bond Municipal Bond Index, which includes tax-exempt general obligation municipals bonds with an average rating of AA/Aa or higher. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers and the nonemployer contributing entity will be based on 70% of the actuarially determined contributions for the State employer and 100% of actuarially determined contributions for local employers. Based on those assumptions, the plan’s fiduciary net position was projected to be available to make projected future benefit payments of current plan members through 2076. Therefore, the long-term expected rate of return on plan investments was applied to projected benefit payments through 2076 and the municipal bond rate was applied to projected benefit payments after that date in determining the total pension liability.

Sensitivity of the Township’s proportionate share of the Net Pension Liability to Changes in the Discount Rate - The following presents the Township’s proportionate share of the net pension liability calculated using the discount rate as disclosed above, as well as what the Township’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (5.85%) or 1-percentage-point higher (7.85%) than the current rate:

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 9. Pension Obligations (continued):

• B.B. Police and Firemen's Retirement System (PFRS) (continued):

1 % Current 1 %

Decrease Discount Rate Increase

(5.85 %) (6.85 %) (7.85 %)

Township's Proportionate Share of the Net Pension Liability $ 48,829,416 $ 36,126,169 $ 25,612,402

State of New Jersey's Proportionate Share of Net Pension Liability associated with the Township 7,710,258 5,704,391 4,044,247

$ 56,539,674 $ 41,830,560 $ 29,656,649

Related Party Investments - The Division of Pensions and Benefits does not invest in securities issued by the Township.

Note 10. Postemployment Benefits Other Than Pensions

General Information about the OPEB Plan

The State Health Benefit Local Government Retired Employees Plan (the Plan) is a cost-sharing multiple-employer defined benefit other postemployment benefit (OPEB) plan with a special funding situation. It covers employees of local government employers that have adopted a resolution to participate in the Plan. For additional information about the Plan, please refer to the State of New Jersey (the State), Division of Pensions and Benefits' (the Division) Comprehensive Annual Financial Report (CAFR), which can be found at https://www.state.nj.us/treasury/pensions/financial-reports.shtml.

3. The Plan provides medical and prescription drug to retirees and their covered dependents of the participating employers. Under the provisions of Chapter 88, P.L 1974 and Chapter 48, P.L. 1999, local government employers electing to provide postretirement medical coverage to their employees must file a resolution with the Division. Under Chapter 88, local employers elect to provide benefit coverage based on the eligibility rules and regulations promulgated by the State Health Benefits Commission. Chapter 48 allows local employers to establish their own age and service eligibility for employer paid health benefits coverage for retired employees. Under Chapter 48, the employer may assume the cost of postretirement medical coverage for employees and their dependents who: 1) retired on a disability pension; or 2) retired with 25 or more years of service credit in a State or locally administered retirement system and a period of service of up to 25 years with the employer at the time of retirement as established by the employer; or 3) retired and reached the age of 65 with 25 or more years of service credit in a State or locally administered retirement system and a period of service of up to 25 years with the employer at the time of

58

TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 10. Postemployment Benefits Other Than Pensions (continued):

retirement as established by the employer; or 4) retired and reached age 62 with at least 15 years of service with the employer. Further, the law provides that the employer paid obligations for retiree coverage may be determined by means of a collective negotiations agreement.

In accordance with Chapter 330, P.L. 1997, which is codified in N.J.S.A 52:14-17.32i, the State provides medical and prescription coverage to local police officers and firefighters, who retire with 25 years of service or on a disability from an employer who does not provide postretirement medical coverage. Local employers were required to file a resolution with the Division in order for their employees to qualify for State-paid retiree health benefits coverage under Chapter 330. The State also provides funding for retiree health benefits to survivors of local police officers and firefighters who die in the line of duty under Chapter 271, P.L.1989.

Pursuant to Chapter 78, P.L, 2011, future retirees eligible for postretirement medical coverage who have less than 20 years of creditable service on June 28, 2011 will be required to pay a percentage of the cost of their health care coverage in retirement provided they retire with 25 or more years of pension service credit. The percentage of the premium for which the retiree will be responsible will be determined based on the retiree's annual retirement benefit and level of coverage.

Basis of Presentation

The schedule of employer and nonemployer allocations and the schedule of OPEB amounts by employer and nonemployer (collectively, the Schedules) present amounts that are considered elements of the financial statements of its participating employers or the State as a nonemployer contributing entity. Accordingly, they do not purport to be a complete presentation of the financial position or changes in financial position of the participating employers or the State. The accompanying Schedules were prepared in accordance with U.S. generally accepted accounting principles. Such preparation requires management of the Plan to make a number of estimates and assumptions relating to the reported amounts. Due to the inherent nature of these estimates, actual results could differ from those estimates.

Allocation Methodology

GASB Statement No. 75 requires participating employers in the Plan to recognize their proportionate share of the collective net OPEB liability, collective deferred outflows of resources, collective deferred inflows of resources, and collective OPEB (benefit) expense. The special funding situation’s and nonspecial funding situation’s net OPEB liability, deferred outflows of resources, deferred inflows of resources, and OPEB (benefit) expense are based on separately calculated total OPEB liabilities. For the special funding situation and the nonspecial funding situation, the total OPEB liabilities for the year ended June 30, 2019 were $5,637,151,775.00 and $8,182,092,807.00, respectively. The nonspecial funding situation’s net OPEB liability, deferred outflows of resources, deferred inflows of resources, and OPEB (benefit) expense are further allocated to employers based on the ratio of the plan members of an individual employer to the total members of the Plan’s nonspecial funding situation during the measurement period July 1, 2018 through June 30, 2019. Employer and nonemployer allocation percentages have been rounded for presentation purposes; therefore, amounts presented in the schedule of OPEB amounts by employer and nonemployer may result in immaterial differences.

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 10. Postemployment Benefits Other Than Pensions (continued):

Special Funding Situation

Under Chapter 330, P.L. 1997, the State shall pay the premium or periodic charges for the qualified local police and firefighter retirees and dependents equal to 80 percent of the premium or periodic charge for the category of coverage elected by the qualified retiree under the State managed care plan or a health maintenance organization participating in the program providing the lowest premium or periodic charge. The State also provides funding for retiree health benefits to survivors of local police officers and firefighters who die in the line of duty under Chapter 271, P.L.1989.

Therefore, these employers are considered to be in a special funding situation as defined by GASB Statement No. 75 and the State is treated as a nonemployer contributing entity. Since the local participating employers do not contribute under this legislation directly to the plan, there is no net OPEB liability, deferred outflows of resources or deferred inflows of resources to report in the financial statements of the local participating employers related to this legislation. However, the notes to the financial statements of the local participating employers must disclose the portion of the nonemployer contributing entities' total proportionate share of the collective net OPEB liability that is associated with the local participating employer.

The participating employer allocations included in the supplemental schedule of employer special funding allocations and the supplemental schedule of special funding amounts by employer for each employer are provided as each employer is required to record in their financial statements, as an expense and corresponding revenue, their proportionate share of the OPEB expense allocated to the State of New Jersey under the special funding situation and include their proportionate share of the collective net OPEB liability in their respective notes to their financial statements. For this purpose, the proportionate share was developed based on eligible plan members subject to the special funding situation. This data takes into account active members from both participating and non-participating employer locations and retired members currently receiving OPEB benefits.

Additionally, the State’s proportionate share of the OPEB liability attributable to the Township is $26,134,660.00 as of December 31, 2019. The OPEB liability was measured as of June 30, 2019. The total OPEB liability used to calculate the OPEB liability was determined using update procedures to roll forward the total OPEB liability from an actuarial valuation as of July 1, 2018, to the measurement date of June 30, 2019. The State’s proportion of the OPEB liability associated with the Township was based on a projection of the Township’s long-term share of contributions to the OPEB plan relative to the projected contributions of all participating members, actuarially determined. The State’s proportion measured as of June 30, 2019 was 0.4729639932%, which was a decrease of 0.0021200074% from its proportion measured as of June 30, 2018, which is the same proportion as the Township’s. At December 31, 2019, the Township’s and the State of New Jersey’s proportionate share of the OPEB liability were as follows:

State of New Jerseyprimes

Proportionate Share of OPEB Liability

$Ass o s c i a t e d w i t h t h e T o w n s h i p$

At December 31, 2019, the State’s proportionate share of the OPEB expense, associated with the Township, calculated by the plan as of the June 30, 2019 measurement date was $346,421.00.

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 11. Municipal Debt

The following schedule represents the Township’s summary of debt, as filed in the Township’s Annual Debt Statement required by the Local Bond Law of New Jersey for the current and two previous years:

Summary of Statutory Debt Condition - Annual Debt Statement

The following schedule is a summary of the previous schedule and is prepared in accordance with the required method of setting up the Annual Debt Statement:

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 11. Municipal Debt (continued)

Net Debt $23,402,179.46 divided by the average Equalized Valuation Basis per N.J.S.A 40A:2-2 as amended, $7,627,191,654.33, equals 0.307% New Jersey statute 40A:2-6, as amended, limits the debt of a Municipality to 3.5% of the last three preceding year's average equalized valuations of real estate, including improvements and the assessed valuation of Class II Railroad Property. The remaining borrowing power in dollars at December 31, 2019 is calculated as follows:

Borrowing Power Under N.J.S. 40A:2-6 as Amended

General Debt

A. Serial Bonds Payable

On July 23, 2014, the Township issued $5,845,000 of General Obligation Bonds. The General Obligation Bonds were issued at interest rates varying from 2.00% to 3.00% and mature in 2025.

On February 2, 2016, the Township issued $7,100,000 of General Bonds. The General Refunding Bonds were issued at interest rates varying from 2.00% to 4.00% and mature in 2028.

During 2016, the Township issued $5,858,000 of General Bonds. The General Obligation bonds were issued at interest rates varying from 2.00% to 4.00% and mature in 2023.

Principal and interest due on the outstanding bonds is as follows:

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 11. Municipal Debt (continued)

B. Bond Anticipation Notes Payable – Short Term Debt

The following is a summary of bond anticipation notes payable accounted for in the General Capital Fund at December 31, 2019:

C. Bonds and Notes Authorized But Not Issued

As of December 31, 2019, the Township had $3,919,439.50 in various General Capital bonds and notes authorized but not issued.

D. Loans Payable

New Jersey Environmental Infrastructure Trust

In 2017 the Township finalized one loan agreement with the State of New Jersey Department of Environmental Protection, pursuant to the 2017A-1 New Jersey Environmental Infrastructure Trust Financing Program.

The loan consists of two agreements, a Trust Loan Agreement of $145,000 to be repaid over a 14 year period at interest rates ranging from 3.00% to 5.00%, and a no interest Fund Loan Agreement of $148,175 to be repaid over a 14 year period. The proceeds of the loans are to provide for the acquisition of a Jet Vac and Sweeper for use by the Township.

Summary of Principal Debt

A summary of the changes in long-term and short term debt of the Township is as follows:

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 12. Deferred Compensation Salary Account

The Township offers its employees a Deferred Compensation Plan in accordance with Internal Revenue Code Section 457 which has been approved by the Director of the Division of Local Government Services. The Plan, available to all full time employees at their option, permits employees to defer a portion of their salary to future years. The deferred compensation is not available to participants until termination, retirement, death or unforeseeable emergency. Amounts deferred under Section 457 plans must be held in trust for the exclusive benefits of participating employees and not be accessible by the Township or its creditors. Since the Township does not have a fiduciary relationship with the Plan, the balances and activities of the Plan are not reported in the Township’s financial statements.

Note 13. Accrued Sick, Vacation and Compensation Time

As discussed in Note 1 and in accordance with accounting principles prescribed by the State of New Jersey, the cash basis of accounting is followed for recording the Township’s liability related to unused vacation, sick pay and compensation time. The Township permits certain employees within limits to accumulate unused vacation, sick pay and compensation time, which may be taken as time off or paid at a later date at an agreed upon rate. In accordance with New Jersey accounting principles, this unused accumulated absences amount is not reported as a liability in the accompanying financial statements. It is estimated that accrued benefits for compensated absences are valued at $3,145,801.06 at December 31, 2019.

The Township has established a Trust Fund in accordance with NJSA 40A:4-39 to set aside funds for future payments of compensated absences. As of December 31, 2019, the Township has reserved in the Other Trust Fund $493,650.40 to fund compensated absences in accordance with NJSA 40A:4-39.

Note 14. Risk Management

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

Joint Insurance Pool

The Township is a member of the Municipal Excess Liability Joint Insurance Fund. The Fund provides the Township with the following coverage

Contributions to the Funds are payable in one installment and are based on actuarial assumptions determined by the Funds' actuaries. The Fund publishes its own financial report for the year ended December 31, 2019 which can be obtained on the Fund's website.

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 14. Risk Management (continued)

New Jersey Unemployment Compensation Insurance

The Township has elected to fund its New Jersey Unemployment Compensation Insurance under the “Reimbursement Method”. Under this plan, the Township is required to reimburse the New Jersey Unemployment Trust Fund, dollar-for-dollar, for unemployment benefits paid to its former employees who were laid off or furloughed and charged to its account with the State. The Township is billed quarterly for amounts due to the State. The following is a summary of Township contributions, reimbursements to the State for benefits paid and the ending balance of the Township’s unemployment trust fund for the current and previous two years:

Year Contributions Amount

2019 $ 33,242.63 $ 26,759.74 $ 307,572.48

2018 27,538.39 6,636.31 301,089.59

2017 26,451.98 5,830.69 280,187.51

Reimbursed Ending Balance

Note 15. Contingencies

Grantor Agencies

The Township receives financial assistance from the State of New Jersey and the U.S. government in the form of grants. Entitlement to the funds is generally conditional upon compliance with terms and conditions of the grant agreements and applicable regulations, including the expenditure of the funds for eligible purposes. Substantially all grants, entitlements and cost reimbursements are subject to financial and compliance audits by grantors. As a result of these audits, costs previously reimbursed could be disallowed and require repayment to the grantor agency. As of December 31, 2019 the Township estimates that no material liabilities will result from such audits.

Litigation

The Township is a defendant in several legal proceedings that are in various stages of litigation. It is believed that the outcome, or exposure to the Township, from such litigation is either unknown or potential losses, if any, would not be material to the financial statements.

Tax Appeals

Losses arising from tax appeals are recognized at the time a decision is rendered by an administrative or judicial body; however, municipalities may establish reserves transferred from tax collections or by budget appropriation for future payments of tax appeal losses.

As of December 31, 2019 there were certain tax appeals on file against the Township related to 2015 through 2019 tax years. The Township has estimated the potential exposure to the Township from such appeals is approximately $313,782.95

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 16. Tax Abatements

The Township is authorized by the New Jersey Housing and Mortgage Financing Act Law of 1983, N.J.S.A. 55:14K-1 et seq. (hereinafter “HMFA Law”), and a Resolution of the Council dated March 13, 2007, to enter into property tax abatement agreements for the purpose of attracting affordable housing. The exemption of the projects from real property taxation subject to this law shall not extend beyond the date on which the Agency Mortgage is paid in full, which according to the HMFA Law, may not exceed fifty (50) years.

For the year ended December 31, 2019, the Township abated property taxes totaling $254,272.09 under this program, including the following tax abatement agreement that exceeded 10 percent of the total, which is the percentage the Township considers to be material for purposes of individual disclosure:

Note 17. Length of Service Awards Program

The Township’s length of service awards program (“LOSAP”) is reported in the Township’s trust fund Statement of Assets, Liabilities, Reserves and Fund Balance - Regulatory Basis. The LOSAP provides tax deferred income benefits to active volunteer firefighters and emergency medical personnel.

The tax deferred income benefits for the active volunteer firefighters and emergency medical personnel serving the residents the of the Township come from contributions made solely by the governing body of the Township, on behalf of those volunteers who meet the criteria of a plan created by that governing body. Participants should refer to the Plan agreement for a more complete description of the Plan’s provisions.

Contributions - If an active member meets the year of active service requirement, a length of service awards program must provide a benefit between the minimum contribution of $100 and a maximum contribution of $1,150 per year. While the maximum amount is established by statute, it is subject to periodic increases that are related to the consumer price index (N.J.S.A. 40A:14-185(f)). The Division of Local Government Services of the State of New Jersey will issue the permitted maximum annually. The Township elected to contribute $1,150.00 for the year ended December 31, 2019 per eligible volunteer, into the Plan, depending on how many years the volunteer has served. During the year ended December 31, 2019, the Township contributed a total of $59,211.00 to the plan. Participants direct the investment of the contributions into various investment options offered by the Plan. The Township has no authorization to direct investment contributions on behalf of eligible volunteers nor has the ability to purchase or sell investment options offered by the Plan. The types of investment options, and the administering of such investments, rests solely with the plan administrator.

Participant Accounts - Each participant’s account is credited with the Township’s contribution and Plan earnings, and charged with administrative expenses. The benefit to which a participant is entitled is the benefit that can be provided from the participant’s vested account. The Township has placed the amounts deferred, including earnings, in a trust maintained by a third-party administrator for the exclusive benefit of the plan participants and their beneficiaries. Such funds, although subject to the claims of the

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 17. Length of Service Awards Program (continued)

Township’s creditors until distributed as benefit payments, are not available for funding the operations of the Township. The funds may also be used to pay the administrative fees charged by the Plan Administrator. Lincoln Financial Group (“Plan Administrator”), an approved Length of Service Awards Program provider, is the administrator of the Plan. The Township’s practical involvement in administering the Plan is essentially limited to verifying the eligibility of each participant and remitting the funds to the Plan Administrator.

Vesting - Benefits, plus actual earnings thereon, are one hundred percent (100%) vested after five (5) years of service.

Payment of Benefits - Upon retirement or disability, participants may select various payout options, which include lump sum, periodic, or annuity payments. In the case of death, with certain exceptions, any amount invested under the participant's account is paid to the beneficiary or the participant's estate. In the event of an unforeseeable emergency, as outlined in the Plan document, a participant or a beneficiary entitled to vested accumulated deferrals may request the local plan administrator to payout a portion of vested accumulated deferrals. During the year ended December 31, 2019 payouts of $16,306.82 were made to vested participants.

Forfeited Accounts – During the year ended December 31, 2019, no accounts were forfeited.

Plan Information - Additional information about the Township's length of service awards program can be obtained by contacting the Plan Administrator.

Note 18. Subsequent Events

Management has reviewed and evaluated all events and transactions that occurred between December 31, 2019 and June 25, 2020, the date that the financial statements were available for issuance, for possible disclosure and recognition in the financial statements.

Covid-19

In December 2019, an outbreak of a new strain of coronavirus, COVID-19, emerged in Wuhan, China. Within weeks, the number of those infected grew significantly, and beyond China's borders. As of the date of this report, the coronavirus is reported to have spread to over 80 countries, and the list is expected to continue to grow. The coronavirus outbreak is still evolving and its effects remain unknown. The Township is unable to predict how changing global economic conditions such as the COVID-19 coronavirus will affect the Township's operations.

General Obligation Bonds

On January 14, 2020 a resolution authorizing the construction and/or acquisition of various general capital improvements, in the County of Ocean, and providing for the issuance of not to exceed $13,640,000 General Obligation Bonds. Interest rates vary from 2.00% to 4.00% and bonds will mature on February 1, 2033.

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TOWNSHIP OF JACKSON NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

Note 18. Subsequent Events (continued)

Pending Litigation

The Township is currently a Defendant in a number of lawsuits filed under the Religious Land Use and Institutional Persons Act (RLUIPA) in Federal Court as well as State Court. These allegations include asserted violations of Constitutional Rights. The Township does maintain insurance for these types of claims, and it is uncertain at this juncture if said coverage will be sufficient to cover any and all claims, etc. These matters range from having just been filed to ongoing discovery. The Township is vigorously defending against each of these allegations and is working to obtain amicable resolutions thereof in a way which would be advantageous to the Township and its' tax payers. At this juncture, it is impossible to determine or estimate the amount of any potential loss which would not be covered by insurance with respect to any of these claims.

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SUPPLEMENTAL EXHIBITS

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CURRENT FUND

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TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF CASH AND CASH EQUIVALENTS FOR THE YEAR ENDED DECEMBER 31, 2019

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TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF DUE FROM STATE - P.L. 1971, C.20 FOR THE YEAR ENDED DECEMBER 31, 2019

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ANALYSIS OF 2019 PROPERTY TAX LEVY

TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF TAXES RECEIVABLE AND ANALYSIS OF PROPERTY TAX LEVY FOR THE YEAR ENDED DECEMBER 31, 2019

TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF TAX TITLE LIENS FOR THE YEAR ENDED DECEMBER 31, 2019

EXHIBIT A-8

SCHEDULE OF PROPERTY ACQUIRED FOR TAXES FOR THE YEAR ENDED DECEMBER 31, 2019

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TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF REVENUE ACCOUNTS RECEIVABLE FOR THE YEAR ENDED DECEMBER 31, 2019

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TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF 2018 APPROPRIATION RESERVES FOR THE YEAR ENDED DECEMBER 31, 2019

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TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF 2018 APPROPRIATION RESERVES FOR THE YEAR ENDED DECEMBER 31, 2019

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EXHIBIT A-10

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TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF ACCOUNTS PAYABLE FOR THE YEAR ENDED DECEMBER 31, 2019

EXHIBIT A-12

SCHEDULE OF RESERVE FOR ENCUMBRANCES FOR THE YEAR ENDED DECEMBER 31, 2019

Balance December 31, 2018 $1,383,951.00

Increased by: 2019 Budget Appropriations 1,289,928.20

Subtotal 2,673,879.20

Decreased by: Transfer to Appropriation Reserves 1,383,951.00

Balance December 31, 2019 $ 1,289,928.20

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TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF PREPAID TAXES FOR THE YEAR ENDED DECEMBER 31, 2019

EXHIBIT A-14

SCHEDULE OF TAX OVERPAYMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

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TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF COUNTY TAXES PAYABLE FOR THE YEAR ENDED DECEMBER 31, 2019

SCHEDULE OF LOCAL DISTRICT SCHOOL TAX PAYABLE FOR THE YEAR ENDED DECEMBER 31, 2019

EXHIBIT A-16

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TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF SPECIAL DISTRICT TAXES PAYABLE FOR THE YEAR ENDED DECEMBER 31, 2019

EXHIBIT A-18 SCHEDULE OF DUE TO STATE OF NEW JERSEY - CONSTRUCTION FEES FOR THE YEAR ENDED DECEMBER 31, 2019

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TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF RESERVE FOR REVALUATION PROGRAM FOR THE YEAR ENDED DECEMBER 31, 2019

Balance December 31, 2019 and 2018 $5,743.40

EXHIBIT A-21

SCHEDULE OF DUE TO MUNICIPAL OPEN SPACE TRUST FUND FOR THE YEAR ENDED DECEMBER 31, 2019

EXHIBIT A-22

SCHEDULE OF RESERVE FOR GARDEN STATE TRUST FUND FOR THE YEAR ENDED DECEMBER 31, 2019

$ 0.95

Balance December 31, 2019 and 2018

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TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF RESERVE FOR STATE BOARD OF TAXATION APPEALS FOR THE YEAR ENDED DECEMBER 31, 2019

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EXHIBIT A-26

TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF RESERVE FOR COAH STATE PLAN FOR THE YEAR ENDED DECEMBER 31, 2019

Balance December 31, 2019 and 2018 $ 915,250.00

SCHEDULE OF RESERVE FOR FEMA REIMBURSEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019

EXHIBIT A-27

Balance December 31, 2019 and 2018 $ 56,727.20

EXHIBIT A-28

SCHEDULE OF RESERVE FOR POLICE CARS FOR THE YEAR ENDED DECEMBER 31, 2019

Balance December 31, 2018 $ 98,183.77

Increased by: Cash Receipts 120,701.13

218,884.90

Decreased by: Cash Disbursements 58,015.38

Balance December 31, 2019 $ 160,869.52

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TOWNSHIP OF JACKSON CURRENT FUND SCHEDULE OF INTERFUNDS - OTHER FUNDS FOR THE YEAR ENDED DECEMBER 31, 2019

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TOWNSHIP OF JACKSON FEDERAL AND STATE GRANT FUND SCHEDULE OF DUE FROM CURRENT FUND FOR THE YEAR ENDED DECEMBER 31, 2019

$1,084,108.11

Balance December 31, 2018

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06

TOWNSHIP OF JACKSON FEDERAL AND STATE GRANT FUND SCHEDULE OF STATE AND FEDERAL GRANTS RECEIVABLE FOR THE YEAR ENDED DECEMBER 31, 2019

91

TOWNSHIP OF JACKSON FEDERAL AND STATE GRANT FUND SCHEDULE OF STATE AND FEDERAL GRANTS - APPROPRIATED FOR THE YEAR ENDED DECEMBER 31, 2019

92

TOWNSHIP OF JACKSON FEDERAL AND STATE GRANT FUND SCHEDULE OF STATE AND FEDERAL GRANTS - APPROPRIATED FOR THE YEAR ENDED DECEMBER 31, 2019

TOWNSHIP OF JACKSON FEDERAL AND STATE GRANT FUND SCHEDULE OF STATE AND FEDERAL GRANTS - UNAPPROPRIATED FOR THE YEAR ENDED DECEMBER 31, 2019

EXHIBIT A-34

SCHEDULE OF RESERVE FOR ENCUMBRANCES FOR THE YEAR ENDED DECEMBER 31, 2019

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TRUST FUND

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TOWNSHIP OF JACKSON TRUST FUND SCHEDULE OF CASH - TREASURER FOR THE YEAR ENDED DECEMBER 31, 2019

TOWNSHIP OF JACKSON ANIMAL CONTROL TRUST FUND SCHEDULE OF DUE TO STATE OF NEW JERSEY FOR THE YEAR ENDED DECEMBER 31, 2019

Balance December 31, 2018 $ 16.80