Integrity. Commitment. Performance.™ PMA Financial Planning Program Howard Crouse, Vice President PMA Financial Network, Inc. March 17, 2014 El Paso-Gridley CUSD 11

Integrity. Commitment. Performance.™ 2 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Financial Planning Program Data Elements Five Years of Audited Annual Financial Reports FY2014 Budget with some projected adjustments Tax Levy / Extensions / Maximum Tax Rates Equalized Assessed Valuation Enrollment Staffing Ratios Compensation and Benefits Provided District Assumptions

Integrity. Commitment. Performance.™ 3 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 FY14 Revenue Breakdown

Integrity. Commitment. Performance.™ 4 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Local Revenue  Levies LY13 1.5% increase in EAV LY14– LY19 1% annual increases in EAV  Minor increase in food service revenues, to keep pace with expenditures, is the only other increase in projected revenues Key Revenue Assumptions

Integrity. Commitment. Performance.™ 5 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Key Revenue Assumptions State Revenue  FY14 – one additional Regular Ed Transportation payment (~$66,000)  General State Aid: Foundation Level – $6,119 through FY19 89% proration in FY13 and FY14 – a reduction of almost $600,000 of revenues 89% proration continues each year in base model  GSA reduction in FY15 due to increase in LY11 EAV Categorical Funding: 0% increases Federal Revenue: 0% annual increases

Integrity. Commitment. Performance.™ 6 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Equalized Assessed Valuation

Integrity. Commitment. Performance.™ 7 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Enrollment Projections

Integrity. Commitment. Performance.™ 8 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 General State Aid

Integrity. Commitment. Performance.™ 9 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Aggregate Revenue Projections (Educational, Operations and Maintenance, Transportation, IMRF, Working Cash, and Tort Funds)

Integrity. Commitment. Performance.™ 10 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 FY14 Expenditures

Integrity. Commitment. Performance.™ 11 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 FY14 Adjustments  Anticipated savings of approximately $150,000 overall (1.25%) Shown in the Educational Fund as ongoing reduction Salaries - Teachers Current contract through FY2014 Future years to be negotiated Health Benefits District costs held flat Projected staffing reductions included  8.56 Certified positions (approximately $524,000)  Classified reductions (approximately $184,000) Key Expenditure Assumptions

Integrity. Commitment. Performance.™ 12 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Key Expenditure Assumptions Purchased Services, Supplies & Materials, Capital Outlay, Other Objects Anticipated reductions of Educational Fund purchased services and supplies of $80,000 Most expenditures held flat in FY15, then 2% increases annually O&M expenditures and Transportation supplies increase 2% in FY15

Integrity. Commitment. Performance.™ 13 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Certified Staffing

Integrity. Commitment. Performance.™ 14 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Aggregate Expenditure Projections (Educational, Operations and Maintenance, Transportation, IMRF, Working Cash, and Tort Funds)

Integrity. Commitment. Performance.™ 15 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Education Fund

Integrity. Commitment. Performance.™ 16 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Operations and Maintenance Fund

Integrity. Commitment. Performance.™ 17 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Transportation Fund

Integrity. Commitment. Performance.™ 18 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 IMRF/Social Security Fund

Integrity. Commitment. Performance.™ 19 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Working Cash Fund

Integrity. Commitment. Performance.™ 20 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Tort Fund

Integrity. Commitment. Performance.™ 21 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Aggregate Revenue to Expenditure Projections (Educational, Operations and Maintenance, Transportation, IMRF, Working Cash, and Tort Funds)

Integrity. Commitment. Performance.™ 22 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Current Projections

Integrity. Commitment. Performance.™ 23 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Observations Revenue growth is almost entirely dependent on both growth in the local tax base and the proration of General State Aid We have not included any implications of potential County- Wide Sales Tax considerations The State controls, without direct regard for the District, how much General State Aid the District receives and the very strong expectation that the State will, within the next two years, shift more of the cost of the pension system to the District Each 1% of GSA proration equals approximately $26,000 Each.5% increase in the District’s TRS obligation equals approximately $30,000 AND is expected to compound

Integrity. Commitment. Performance.™ 24 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Impact of GSA Proration and TRS Cost Shift Scenarios that follow reflect impact of GSA proration at 15% (base model), 20%, and FY13 level of 11% Also reflect impact of 1% per year increase in employer contribution on behalf of certified staff to TRS (base model),.5% increase, or no increase

Integrity. Commitment. Performance.™ 25 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Impact of.5% per year TRS Cost Shift

Integrity. Commitment. Performance.™ 26 Data & Assumptions provided by District PMA Financial Planning Program| El Paso-Gridley CUSD 11 Copyright 2010 PMA Financial Network, Inc. The information contained herein is solely intended to suggest/discuss potentially applicable financing applications and is not intended to be a specific buy/sell recommendation, nor is it an official confirmation of terms. Any terms discussed herein are preliminary until confirmed in a definitive written agreement. The analysis or information presented herein is based upon hypothetical projections and/or past performance that have certain limitations. No representation is made that it is accurate or complete or that any results indicated will be achieved. In no way is past performance indicative of future results. Changes to any prices, levels, or assumptions contained herein may have a material impact on results. Any estimates or assumptions contained herein represent our best judgment as of the date indicated and are subject to change without notice. Examples are merely representative and are not meant to be all-inclusive. The information set forth herein was gathered from sources which we believe, but do not guarantee, to be accurate. Neither the information, nor any options expressed, constitute a solicitation by us for purposes of sale or purchase of any securities or commodities. Investment/financing decisions by market participants should not be based on this information. You should consider certain economic risks (and other legal, tax, and accounting consequences) prior to entering into any type of transaction with PMA Securities, Inc. or PMA Financial Network, Inc. It is imperative that any prospective client perform its own research and due diligence, independent of us or our affiliates, to determine suitability of the proposed transaction with respect to the aforementioned potential economic risks and legal, tax, and accounting consequences. Our analyses are not and do not purport to be appraisals of the assets, or business of the District or any other entity. PMA makes no representations as to the actual value which may be received in connection with a transaction nor the legal, tax, or accounting effects of consummating a transaction. PMA cannot be relied upon to provide legal, tax, or accounting advice. You should seek out independent and qualified legal, tax, and accounting advice from outside sources. If posted on a webpage, this information has been prepared for informational and educational purposes and does not constitute a solicitation to purchase or sell securities, which may be done only after client suitability is reviewed and determined. Services offered by PMA Securities, Inc. and this registered representative presenter, in particular, are available only in the following state: IL. This information is not an advertisement of services available in any state other than those listed above.