City of Grayville

White and Edwards County, Illinois

    Annual Financial Report and Independent Auditors’ Report

For the Fiscal Yeat Ended April 30, 2025

City of Grayville

White and Edwards County, Illinois

Table of Contents

Paqe

Financial Section

Independent Auditors’ Report                                                                                        1-4

Independent Auditors’ 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                                                                                   5-6

Basic Financial Statements

Statement of Net Position                                                                                              7

Statement of Activities                                                                                                  8

Balance Sheet – Governmental Funds                                                                      9

Statement of Revenues, Expenditures, and Changes

in Fund Balances – Governmental Funds                                                                  10

Reconciliation of the Statement of Revenues, Expenditures,

and Changes in Fund Balances of Governmental Funds

to the Statement of Activities                                                                                       11

Statement of Net Position Proprietary Funds                                                                  12

Statement of Revenues, Expenses, and Changes in

Fund Net Position – Proprietary Funds                                                                           13

Statement of Cash Flows Proprietary Funds

Notes to the Financial Statements

Required Supplementary Information

Schedule of Revenues, Expenditures, and Changes in

Fund Balances — Budget and Actual General Fund                                       42—46

Schedule of Revenues, Expenditures, and Changes in

Fund Balances — Budget and Actual TIF #1 Fund                                                        47

Schedule of Changes in Net Pension Liability and Related Ratios                  48-49

Schedule of Contributions                                                                                               50

Notes to the Required Supplementary Information                                                     51

City of Grayville

White and Edwards County, Illinois Table of Contents

(Concluded)

Egge

Supplementary Information
Combining Balance Sheet — Nonmajor Governmental Funds Combining Statement of Revenues, Expenditures, and	52
in Fund Balances — Nonmajor Governmental Funds	53

Changes

Financial Section

H. KEITH BOTSCH, CPA                                                                                                                                                                     113 E. Main Street

ARLYNNE STROMAN, CPA                                                                                                                                               Carmi, Illinois 62821

(618) 382-4151

August 18, 2025

Independent Auditors’ Report

The City Council

City of Grayville

Grayville, IL 62844

Report on the Audit of the Financial Statements

Opinions

We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Grayville, Illinois, as of and for the year ended April 30, 2025, and the related notes to the financial statements, which collectively comprise the City of Grayville, Illinois’ basic financial statements as listed in the table of contents.

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Grayville, Illinois, as of April 30, 2025, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinions

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. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City of Grayville, Illinois and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and 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.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City of Grayville, Illinois’ ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level of assurance but it is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than” for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgement made by a reasonable user based on the financial statements.

In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:

• Exercise professional judgment and maintain professional skepticism throughout the audit.
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
• Obtain an understanding of internal control relevant to the audit 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 City of Grayville, Illinois’ internal control. Accordingly, no such opinion is expressed.
• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City of Grayville, Illinois’ ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.

Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the budgetary comparison information and the IMRF pension schedules on pages 42-47 and 48-50 be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial repofting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Management has omitted the management’s discussion and analysis that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. Our opinion on the basic financial statements is not affected by this missing information.

Supplementary Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Grayville, Illinois’ basic financial statements. The accompanying combining nonmajor fund financial statements are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining nonmajor fund financial statements are fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated August 18, 2025, on our consideration of the City of Grayville, Illinois’ 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 solely 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 effectiveness of the City of Grayville, Illinois’ 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 City of Grayville, Illinois’ internal control over financial reporting and compliance.

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1 13 E Main St.

Carmi, IL 62821

H. KEITH BOTSCH, CPA                                                                                                                                                113 E. Main Street

ARLYNNE STROMAN, CPA                                                                                                                                               Carmi, Illinois 62821

(618) 3824151

August 18, 2025

Independent Auditors’ 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

To the City Officials

City of Grayville

Grayville, IL 62844

We have audited, in accordance with the 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, the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Grayville, Illinois, as of and for the year ended April 30, 2025, and the related notes to the financial statements, which collectively comprise the City of Grayville, Illinois’ basic financial statements and have issued our report thereon dated August 18, 2025.

Report on Internal Control over Financial Reporting

In planning and performing our audit of the financial statements, we considered the City of Grayville, Illinois’ internal control over financial reporting (internal control) as a basis for designing 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 City of Grayville, Illinois’ internal control. Accordingly, we do not express an opinion on the effectiveness of the City of Grayville, Illinois’ 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 and therefore, material weaknesses or significant deficiencies may exist that were not identified. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. We identified certain deficiencies in internal control that we consider to be significant deficiencies as follows: The City lacks the expertise to make all adjusting entries and prepare financial statements, including disclosures, in accordance with accounting principles generally accepted in the United States of America.

Report on Compliance and Other Matters

As part of obtaining reasonable assurance about whether the City of Grayville, Illinois’ 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 financial statements. 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 as follows: The City is not in compliance with the Operations and Maintenance and Debt Service Fund requirements for the Water and Sewer Bonds.

City of Grayville, Illinois’ Response to Findings

Government Auditing Standards requires the auditor to perform limited procedures on the City of Grayville, Illinois’ response to the findings identified in our audit and described previously. The City of Grayville, Illinois’ response to the findings identified in our audit are as follows: We acknowledge that we do not have personnel capable of drafting the financial statements or footnotes; however, we accept full responsibility for the financial statements and footnotes, which are drafted by the auditor, and acknowledge such in writing. We are comfortable with the auditor drafting the financial statements and footnotes. The City will put procedures in place to prevent bond noncompliance in the future. The City of Grayville, Illinois’ response was not subjected to the other auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on the response.

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 of the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

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113 E Main St.

Carmi, IL 62821

Basic Financial Statements

Statement of Net Position

April 30, 2025

Primary Government

                                                                       Governmental          Business-type

Assets Current assets:
Cash and cash equivalents	116701083
Receivables, net	350,544                            335,945                          686,489
Prepaid expense	30237                             1011604                             131,841
Total current assets Noncurrent assets:	21107 ,632

                                                                          Activities                 Activities                    Total

        Restricted cash                                                                                                                     545,176                           633,095

        Land                                                                                                                                        146,815                           443,845

Capital assets, net

Total noncurrent assets

DEFERRED OUTFLOWS OF RESOURCES
Deferred outflows related to pensions Total assets and deferred outflows Liabilities Current liabilities:	341,812                           239,795                          5811607
Accounts payable	50,290                         141 ,904                       192,194
Customer deposits	16,961                             16,961
Accrued expenses	53,786                             54,525                          108,31 1
Bank overdraft	255,120                           255,120
Unearned revenue	212,972                           212,972

Total assets

Current portion of tong-term debt133,488             246,991 Total current liabilities       814,970

Noncurrent liabilities:
Noncurrent portion of long-term debt		2278.329	3,382,886

Net pension liability   98,133 238,016 Total noncurrent liabilities   3,620,902

Total liabilities

DEFERRED INFLOWS OF RESOURCES

    Deferred inflows related to pensions                                                                                    145,628                           353,212

Total liabilities and deferred inflows

Net position
Investment in capital assets Restricted for:	31581 ,840		6,2911041
Debt service Economic development	87,919	545,176	633,095
Public safety	27,871		27,871
Streets and roads	245,182		245,182
	121 1034

Culture and recreation121,034

    Unrestricted                                                                                    357,146

Total net position

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Balance Sheet Governmental Funds

April 30, 2025

                                                                                                                                                                  Nonmajor                    Total

                                                                          General             TIF #1          Governmental    Governmental

Assets

     Cash and cash equivalents                                                  288,333               535,510                     709,883

    Receivables, net                                                                       236,237                                                    114,307                  350,544

Prepaid items 30,237 30,237 Due from other funds 4,320 41320

     Restricted cash                                                                           87,919                                                                                      871919

Total assets

Liabilities and fund balances

Liabilities

Accounts payable

Accrued expense

Due to other funds

Total liabilities

Fund balances

Nonspendable:

Prepaid           30,237   30,237 Restricted for:

        Debt service                                                                            87,919                                                                                       87,919

       Economic development                                                                                      535,510                     518,033              

Public safety

Streets and roads

Culture and recreation

Committed to general government

Unassigned

Total fund balances

647,046

535,510 824,190

Total liabilities and fund balances

Amounts reported for governmental activities in the statement of net position are different because: Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds.               

Net pension liabilities and pension related deferred outflows and inflows of resources are not available to pay for current-period expenditures and therefore are deferred in the funds            (5,655)

Long-term liabilities including bonds payable are not due and payable in the current period and, therefore, are not reported in the funds.

Net position of governmental activities

                                The                                                                       statement.

Statement of Revenues, Expenditures, and Changes in Fund Balances

Governmental Funds

For the Year Ended April 30, 2025

		Nonmajor	Total
Revenues		Governmental	Governmental
Property taxes	260,920            421,914	146,584	829,418
Other taxes		61 ,955	61,955
Licenses and permits	28,747		28,747
Fines and forfeitures	22,189		221189
Interest	3,036                  3,495	6,664	13, 195
Intergovernmental	1,555,409	126,685
Charges for services	53,202		531202
	329,275

Miscellaneous                                                    329,275

Total revenues

Expenditures Current:
General government	198,828			198,828
Social services	129,613			129,613
Public safety	823,521			823,521
Streets and roads	174,319		136,636	310,955
Economic development		245,671	153,896	399,567
Culture and recreation Debt Service:	254,060			254,060
Principal	1 18,449			1 1 8,449
Interest	51,376			51,376
	265,379

Capital outlay                                                     265,379

Excess (deficiency) of revenues
over expenditures	237,233	179,738	51,356	468,327

     Total expenditures                                                                                                                       2,551,748

Other financing sources (uses)

Transfer in (out)

Total other financing sources (uses)

Net change in fund balances	102,621	179,738	120,919	403,278
Fund balances – beginning	440,349	355,772	698,951	1495,072

542,970

535,510

819 870

Fund balances – ending                                                                                                          

                                The                                                                              statement.

Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities

For the Year Ended April 30, 2025

      Net change in fund balances – total governmental funds                                                      403,278

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

Governmental funds report capital outlays as expenditures. However, in the statement of activities, the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlay $265,379 exceeded depreciation

          ($176, 778) in the current period.                                                                                       88,601

In the statement of activities, only the gain on the sale of assets is reported, whereas in the governmental funds, the proceeds from the sale increase financial resources. Thus, the change in net position differs from the change in fund balance by the cost of the assets sold.          (27,193)

Debt proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the statement of net position. Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net position. This is the amount by which repayments $118,449 exceeded proceeds ($0) in the current period.  1 18,449

Some expenses reported in the statement of activities do not require the use of current financial resources and therefore are not reported in governmental funds. This amount represents the change in net pension liability ($100,334), pension-related deferred outflows of resources ($43,908), and pension-related deferred inflows of resources $85,891 in the current period.

524,784

Change in net position of governmental activities

                                The                                                                               statement.

0

April 30, 2025

Policies

The accounting policies of the City of Grayville, White and Edwards County, Illinois (the City), as reflected in the accompanying financial statements for the year ended April 30, 2025, conform to accounting principles generally accepted in the United States of America (GAAP)} as applicable to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The following is a summary of the significant accounting policies.

A.     Reporting Entity

As required by GAAP, these financial statements present only the operations of the City.

B.      Government-Wide and Fund Financial Statements

The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the nonfiduciary activities of the City. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from businesstype activities, which rely to a significant extent on fees and charges for support.

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

Separate financial statements are provided for governmental funds and proprietary funds. Major individual governmental funds are reported as separate columns in the fund financial statements. Nonmajor funds are reported in the supplementary information.

C.      Fund Accounting

The City uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain government functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts.

April 30, 2025

(Continued)

Policies (Cont’d)

C.      Fund Accounting (Cont’d)

Funds are classified into three broad categories: governmental, proprietary, and fiduciary. Each category, in turn, is divided into separate “Fund Types.

The City has the following fund types and account groups:

Governmental Funds are used to account for the City’s general governmental activities. There are two of these types and they each use the flow of current financial resources measurement focus and the modified accrual basis of accounting.

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

Special Revenue Funds account for the proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes other than debt service and capital projects.

Proprietary Funds are used to account for activities similar to those found in the private sector, where the determination of net income is necessary or useful for sound financial administration. Goods or services from such activities are provided to outside parties by the enterprise fund.

Enterprise Funds are used to account for those operations that are financed and operated in a manner similar to private business or where the City Board has decided that the determination of revenues earned, costs incurred, and/or net income is necessary for management accountability.

Fiduciary Funds account for assets held by the government in a trustee capacity or as an agent on behalf of others. Trust funds account for assets held by the government under terms of a formal trust agreement. Custodial funds are used to report resources held by the reporting government in a purely custodial capacity. Custodial funds typically involve only the receipt, temporary investment, and remittance of fiduciary resources to specific individuals, private organizations, or other governments.

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

The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows.

April 30, 2025

(Continued)

Policies (Cont’d)

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

Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met.

Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the City considers property taxes as available if they are collected within 60 days of the end of the current fiscal period. A one-year availability period is used for revenue recognition for all other governmental fund revenues. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded when payment is due.

Property taxes, sales taxes, income taxes, motor fuel taxes, licenses, interest revenue, and charges for services revenues associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. All other revenue items are considered to be measurable and available only when cash is received by the

The City reports the following major governmental funds:

The General Fund is the City’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. It includes administration, zoning, police, street, dispatch, library, dog pound, park, and cemetery activities.

The TIF #1 Fund is the special revenue fund that accounts for tax revenues used to promote economic development in the City.

The City reports the following major enterprise funds:

The Water, Sewer, and Gas Funds account for the provision of water, sewer, and gas services to the City residents as well as repairs and improvements. All activities necessary to provide these services are accounted for in these funds including, but not limited to, administration, operations, maintenance, financing and related debt service, and billing and collections. Monies are provided from user charges and miscellaneous sources.

(Continued)

Note 1. Summary of Significant Accounting Policies (Cont’d)

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

As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements.

Amounts reported as program revenues include charges to customers or applicants for goods, services, or privileges provided and operating grants and contributions. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes.

Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the enterprise funds are fees for services. Operating expenses for the enterprise funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses.

               E.      Budgets

Budgets are adopted on a basis consistent with GAAP. Annual appropriated budgets are adopted (at the fund level) for the general, special revenue, and enterprise funds. The annual appropriated budget is legally enacted and provides for a legal level of control at the fund level. All annual appropriations lapse at fiscal year-end.

The City Treasurer is authorized to transfer budgeted amounts between departments within any fund; however, any revisions that alter the total expenditures of any fund must be approved by the City Council.

               F.      Cash Equivalents

For purposes of the statement of cash flows, all highly liquid investments with maturities of three months or less at the date of purchase are considered cash equivalents.

April 30, 2025

(Continued)

Note 1. Summary of Significant Accounting Policies (Cont’d)

               G.    Receivables

GASB Statement No. 33 – Accounting and Financial Reporting for Non-Exchange Transactions recognizes receivables associated with non-exchange transactions as follows:

     Derived tax receivables (such as: sales, income, and motor fuel taxes) are recognized when the underlying exchanges have occurred.

1. Imposed non-exchange receivables (such as: property taxes and fines) are recognized when an enforceable legal claim has arisen.
2. Government mandates or voluntary non-exchange transaction receivables (such as: mandates or grants) are recognized when all legal requirements have been met.

               H.      Prepaid Items

Prepaid items represent payments made to vendors for services that will benefit future periods at the end of the fiscal year and are accounted for using the consumption method.

Capital Assets

Capital assets, which include property, plant, and equipment, are reported in the applicable governmental or business-type activities columns in the governmentwide financial statements. Capital assets are defined as having a useful life greater than one year with an initial, individual cost of more than $10,000. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value on the date of the donation.

The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed.

Capital assets are depreciated using the straight-line method over the following

estimated useful lives:

Years

Streets
Buildings	30
Sewer, Water and Pool systems	30
Gas system	66
Equipment	10-30
Vehicles	3-5
Boat ramp	50

(Continued)

Note 1. Summary of Significant Accounting Policies (Cont’d)

               J.        Compensated Absences

a. Vacation

Each employee who is regular full time shall beentitled to vacation with pay in accordance with the schedule set below based on the employee’s anniversary date.

 Employees who have completed one (1) year of continuous service shall receive five (5) working days of paid vacation.

 Employees who have completed two (2) years of continuous service shall receive ten (10) working days of paid vacation.

 Employees who have completed seven (7) years of continuous service shall receive fifteen (15) working days of paid vacation.

• Employees who have completed twelve (12) years of continuous service shall receive twenty (20) working days of paid vacation.        
• Employees who have completed twenty (20) years of continuous service shall receive twenty-five (25) working days of paid vacation.

Employees may accumulate vacation time equal to the amount of vacation that could be earned over a two (2) year period. However, accumulated vacation in excess of the maximum amount must be used prior to January 1 of each year or that excess accumulation will be forfeited. In the event a requested vacation time is denied; the excess accumulation will be paid in

An employee who quits or is laid off and is entitled to vacation pay or vacation earned, but not used, on the date of their termination, will be paid by the City in full with the next payroll period.

b. Sick Leave

Each regular full-time employee shall accrue sick leave at the rate of eight (8) hours per month of continuous employment. The accrual shall be credited the first paycheck of the following month. Employees may accumulate up to maximum of 960 hours of sick leave.

Upon bona fide retirement from service, employees will convert unused sick leave to a salary payment not to exceed a maximum of thirty (30) days. At termination of employment, for any other reason, sick leave will also terminate. Sick leave may be credited towards retirement as per IMRF code and regulations.

Accrued leave at April 30, 2025, was $81 , 193.

1. Summary of Significant Accounting Policies (Cont’d)

     K.     Long-Term Obligations

In the government-wide financial statements and proprietary fund type financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities or business-type activities statement of net position.

    L.   

In the fund financial statements, governmental funds report aggregate amounts for five classifications of fund balances based on the constraints imposed on the use of these resources. The nonspendable fund balance classification includes amounts that cannot be spent because they are either (a) not in spendable form  prepaid items or inventories; or (b) legally or contractually required to be maintained intact.

The spendable portion of the fund balance comprises the remaining four classifications: restricted, committed, assigned, and unassigned.

Restricted fund balance. This classification reflects the constraints imposed on resources either (a) externally by creditors, grantors, contributors, or laws or regulations of other governments; or (b) imposed by law through constitutional provisions or enabling legislation.

Committed fund balance. These amounts can only be used for specific purposes pursuant to constraints imposed by formal resolutions or ordinances of the City Council — the government’s highest level of decision-making authority. Those committed amounts cannot be used for any other purpose unless the City Council removes the specified use by taking the same type of action imposing the commitment. This classification also includes contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements.

Assigned fund balance. This classification reflects the amounts constrained by the City’s “intent” to be used for specific purposes, but are neither restricted nor committed. The City Council and City Mayor have the authority to assign amounts to be used for specific purposes. Assigned fund balances include ail remaining amounts (except negative balances) that are reported in governmental funds, other than the General Fund, that are not classified as nonspendable and are neither restricted nor committed.

1. Summa of Si nificant Accountin Policies (Cont’d)

     L.      Fund Equity (Cont’d)

Unassigned fund balance. This fund balance is the residual classification for the General Fund. It is also used to report negative fund balances in other governmental funds.

When both restricted and unrestricted resources are available for use, it is the City’s policy to use externally restricted resources first, then unrestricted resources — committed, assigned, and unassigned — in order as needed.

     M.     Interfund Transactions

Quasi-external transactions are accounted for as revenues, expenditures, or expenses. Transactions that constitute reimbursements to a fund for expenditures/expenses initially made from it that are properly applicable to another fund are recorded as expenditures/expenses in the reimbursing fund, and as reductions of expenditures/expenses in the fund that is reimbursed.

     N.      Use of Estimates

In preparing financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

      O.     Deferred Outflows and Inflows of Resources

In addition to assets, the statement of financial position reports a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of net position that applies to future reporting periods and so will not be recognized as an outflow of resources until then.

In addition to liabilities, the statement of financial position reports a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of net position that applies to future reporting periods and so will not be recognized as an inflow of resources until that time.

23

2. Deposits and Investments

The City’s investment policy is to establish cash management and investment guidelines for the City officials responsible for the stewardship of public funds. The City has established specific objectives to meet these guidelines,

The City deposits and invests all its monies in investments allowed by Illinois State Statutes. The Statutes authorize the City to make deposits in commercial banks and savings and loan institutions.

Concentrations: The City’s policy is to maintain a diversified portfolio to minimize the risk of loss resulting from over concentration of assets in a specific issuer.

Custodial Credit Risk:

Deposits: This is the risk that, in the event of a bank failure, the government’s deposits may not be returned to it. The City does not have a deposit policy for custodial credit

As of April 30, 2025, $537,907 of the City’s bank balance of $3,968,413 was exposed to custodial credit risk as follows:

Uninsured and uncollateralized

Uninsured and collateral held by pledging bank’s trust department not in the City’s name            537,907 Total  $ 537,907

Investments: This is the risk that in the event of the failure of the counterparty (e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The City does not have custodial credit risk policies for investments.

For pension trust funds, the types of deposits authorized, and the mix of credit risk categories do not differ significantly from the other funds of the City.

The City has investments in The Illinois Funds, which has regulatory oversight from the State of Illinois, Office of the Auditor General, in which the fair value of the City’s position in the pool is the same as the value of the pool shares. As of January 16, 2025, the pool was rated “AAAmmf’ by Fitch Ratings. The annual report of The Illinois Funds for the year ended June 30, 2024 is available from the Illinois State Treasurer,

The Illinois Funds Administrative Office, 1 East Old State Capitol Plaza, Springfield, IL 62701, 1-866-458-7327, or is available online at: http:/lwww.auditor.illinois.gov/AuditReports/THE„lLLlNOlS-FUNDS.asp.

3.

Grants

Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies. Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of expenditures which may be disallowed by the grantor cannot be determined at this time although the City expects such amounts, if any, to be immaterial.

Note 4. Note 5.

Risk Management The City 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. During the year ended April 30, 2025, the City belonged to the Illinois Municipal League Risk Management Association, a public entity risk pool currently operating as a common risk management and insurance program. The City pays an annual premium to the pool for its general insurance coverage. The agreement for formation of the Illinois Municipal League Risk Management Association provides that the pool will be self-sustaining through member premiums and will reinsure through commercial companies. The pooling agreement allows for the pool to make additional assessments to make the pool self-sustaining. The City estimates the range of contingent losses to be borne by the City to not be possible to estimate. During the year ended April 30, 2025 there were no significant reductions in coverage. Also, there have been no settlement amounts, which have exceeded insurance coverage in the past three years. The Illinois Municipal League Risk Management Association has published its own financial report which can be obtained from the Illinois Municipal League Risk Management Association at P.O. Box 5180, Springfield, Illinois 62705. Receivables – Taxes

Property taxes attach as an enforceable lien on property as of January 1. Taxes must be levied by the last Tuesday in December and a copy of the tax levy ordinance must be filed with the County Clerk by this date. Property taxes for the fiscal year ended

April 30, 2025 were due in September and October 2024. The City receives their share of these taxes approximately one month after their due dates.

6. Restricted Fund Balance

The City’s restricted fund balance is restricted by enabling legislation as follows:

The Revolving Loan and Motel Tax Funds are restricted by state legislation.

The Motor Fuel Tax Fund is restricted by the Illinois Department of Transportation for the repair and maintenance of roads.

The TIF Funds are restricted by their tax levies.

The police, park, and streets and roads funds are restricted by their tax levies and are accounted for in the General Fund.

Note 7.

Capital asset activity for the year ended April 30, 2025 was as follows:

                                                                   Beginning                                                      Ending

Balance  Increases          Disposals         Balance A. Governmental Activities:

$	297,030 792, 175 736,514 301,147 485,460 149,630
	265,098 535,101 108,579 120,965 1 13,020

4,891

Capital assets, not being depreciated – Land          $ 292,139        

Capital assets, being depreciated

         Buildings                                                 792, 199          205,000          205,024

         Vehicles and equipment                            681,026             55,488                     

         Infrastructure                                      

          Pool system                                             301,147                                           

          Park Improvements                                  485,460                                           

         Boat ramp                                 1491630

Total capital assets, being depreciated    15,866,554       260,488 205,024 Less accumulated depreciation for:

            Buildings                                              419,135             23,794          1771831

Vehicles and equipment 491,901 43,200 Infrastructure  10,195,814       80,571

            Pool system                                            98,541             10,038                     

            Park Improvements                                104,783             16,182                     

            Boat ramp                                             110,027              2,993

              Total accumulated depreciation                                   176,778

Total capital assets, being depreciated, net

Governmental activities capital assets, net $ 47381492                 88,601            27,193

7. (Cont’d)

                                                                      Beginning                                                Ending

                                                                         Balance         Increases Disposals        Balance

R	Business-type Activities: Capital assets, not being
	depreciated – Land Capital assets, being depreciated	$	146,815		$	146,815

Gas system

Sewer system

Water system

Equipment

Total capital assets, being
depreciated		14214099

Less accumulated depreciation for:

                Gas system                                        1, 180,626          38,595                           1219221

               Sewer system                                     5, 106,723

Water system

Equipment

Total accumulated depreciation

Total capital assets, being depreciated, net    4974203

Business-type activities capital assets, net

Governmental activities:
General government	101335
Streets and roads	95,618
Public safety	17,674
Culture and recreation	45,122
Economic development	4640
Social services	3,389

Depreciation expense was charged to functions/programs of the governmental activities as follows:

                           Total depreciation expense – governmental activities                              $ 176 778

8.

Illinois Municipal Retirement Fund

Plan Description. The employer’s defined benefit pension plan for regular employees provides retirement and disability benefits, post-retirement increases, and death benefits to plan members and beneficiaries. The employer’s plan is managed by the Illinois Municipal Retirement Fund (IMRF), the administrator of a multi-employer public pension fund. A summary of IMRF’s pension benefits is provided in the [‘Benefits Provided” section of this document. Details of all benefits are available from IMRF. Benefit provisions are established by statute and may only be changed by the General Assembly of the State of Illinois. IMRF issues a publicly available Comprehensive Annual Financial Report that includes financial statements, detailed information about the pension plan’s fiduciary net position, and required supplementary information. The report is available for download at www.imrf.org.

Benefits Provided. IMRF has three benefit plans. The vast majority of IMRF members participate in the Regular Plan (RP). The Sheriffs Law Enforcement Personnel (SLEP) plan is for sheriffs, deputy sheriffs, and selected police chiefs. Counties could adopt the Elected County Official (ECO) plan for officials elected prior to August 8, 2011 (the ECO plan was closed to new participants after that date).

All three IMRF benefit plans have two tiers. Employees hired before January 1, 2011, are eligible for Tier 1 benefits. Tier 1 employees are vested for pension benefits when they have at least eight years of qualifying service credit. Tier 1 employees who retire at age 55 (at reduced benefits) or after age 60 (at full benefits) with eight years of service are entitled to an annual retirement benefit, payable monthly for life, in an amount equal to 1-213% of the final rate of earnings for the first 15 years of service credit, plus 2% for each year of service credit after 15 years to a maximum of 75% of their final rate of earnings. Final rate of earnings is the highest total earnings during any consecutive 48 months within the last 10 years of service, divided by 48. Under Tier 1, the pension is increased by 3% of the original amount on January 1 every year after retirement.

8.

Illinois Municipal Retirement Fund — (Cont’d)

Employees hired on or after January 1, 201 1, are eligible for Tier 2 benefits. For Tier 2 employees, pension benefits vest after ten years of service. Participating employees who retire at age 62 (at reduced benefits) or after age 67 (at full benefits) with ten years of service are entitled to an annual retirement benefit, payable monthly for life, in an amount equal to 1-2/3 ⁰/0 of the final rate of earnings for the first 15 years of service credit, plus 2% for each year of service credit after 15 years to a maximum of 75% of their final rate of earnings. Final rate of earnings is the highest total earnings during any 96 consecutive months within the last 10 years of service, divided by 96. Under Tier 2, the pension is increased on January 1 every year after retirement, upon reaching age 67, by the lesser of:

• 3% of the original pension amount, or
• 1/2 of the increase in the Consumer Price Index of the original pension amount.

Employees Covered by Benefit Terms. As of December 31, 2024, the following employees were covered by the benefit terms:

IMRF

Retirees and Beneficiaries currently receiving benefits

                Inactive Plan Members entitled to but not yet receiving benefits                  13

                Active Plan Members                                                                                     16

                   Total                                                                                                             53

Contributions. As set by statute, the employer’s Regular Plan Members are required to contribute 4.5% of their annual covered salary. The statute requires employers to contribute the amount necessary, in addition to member contributions, to finance the retirement coverage of its own employees. The employer’s annual contribution rate for calendar year 2024 was 6.4%. For the fiscal year ended April 30, 2025, the employer contributed $51 ,568 to the plan. The employer also contributes for disability benefits, death benefits, and supplemental retirement benefits, all of which are pooled at the IMRF level.

Contribution rates for disability and death benefits are set by IMRF’s Board of Trustees, while the supplemental retirement benefits rate is set by statute.

Net Pension Liability. The employer’s net pension liability was measured as of December 31, 2024. The total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date.

8.

Illinois Municipal Retirement Fund — (Cont’d)

Actuarial Assumptions. The following are the methods and assumptions used to determine total pension liability at December 31 , 2024:

• The Actuarial Cost Method used was Entry Age Normal.
• The Asset Valuation Method used was Market Value of Assets.
• The Inflation Rate was assumed to be 2.25%.
• Salary Increases were expected to be 2.85% to 13.75%, including inflation.
• The Investment Rate of Return was assumed to be 7.25%.
• Projected Retirement Age was from the Experience-based Table of Rates, specific to the type of eligibility condition, last updated for the 2023 valuation according to an experience study of the period 2020-2022.
• For Non-Disabled Retirees, the Pub-2010, Amount-Weightedl below median income, General, Retiree, Male (adjusted 108%) and Female (adjusted 106.4%) tables, and future mortality improvements projected using scale MP-2021.
• For Disabled Retirees, the Pub-2010, Amount-Weighted, below median income, General, Disabled Retiree, Male and Female (both unadjusted) tables, and future mortality improvements projected using scale MP2021.
• For Active Members, the Pub-2010, Amount-Weighted, below median income, General, Employee, Male and Female (both unadjusted) tables, and future mortality improvements projected using scale MP-2021.
• The long-term expected rate of return on pension plan investments 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 to the target asset allocation percentage and adding expected inflation. The target allocation and best estimates of geometric real rates of return for each major asset class are summarized in the following table as of December 31, 2024:

8.

Domestic Equity	33.50%	4.35%
International Equity	18.00%	5.40%
Fixed Income	24.50%	5.20%
Real Estate	10.50%	6.40%
Alternative Investments	1250%	4.85-6.25%
Cash Equivalents	1.00%	3.60%

Illinois Municipal Retirement Fund — (Cont’d)

		Long-Term
	Portfolio	Expected
	Target	Real Rate
Asset Class	Percentage	of Return

                          Total                                    100.00%

Single Discount Rate. A Single Discount Rate of 7.25% was used to measure the total pension liability. The projection of cash flow used to determine this Single Discount Rate assumed that the plan members’ contributions will be made at the current contribution rate, and that employer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. The Single Discount Rate reflects:

1. The long-term expected rate of return on pension plan investments (during the period in which the fiduciary net position is projected to be sufficient to pay benefits), and
2. The tax-exempt municipal bond rate based on an index of 20-year general obligation bonds with an average AA credit rating (which is published by the Federal Reserve) as of the measurement date (to the extent that the contributions for use with the long-term expected rate of return are not met).

For the purpose of the most recent valuation, the expected rate of return on plan investments is 7.25%, the municipal bond rate is 4.08%, and the resulting single discount rate is 7.25%.

8. –

Illinois Munici al Retirement Fund — (Cont’d)

Changes in the Net Pension Liability.

Total

                                                                                        Pension       Plan Fiduciary     Net Pension

                                                                                                              Net Position          Liability

Balances at December 31 , 2023 Changes for the year:

Service Cost	69,195		69, 195
Interest on the Total Pension Liability Changes of Benefit Terms Differences Between Expected and Actual	294,488		294,488
Experience of the Total Pension Liability Changes of Assumptions	2351973		235,973
Contributions – Employer		53,342	(53,342)
Contributions – Employees		37,507	(37,507)
Net Investment Income Benefit Payments, including Refunds		414014	(414014)
of Employee Contributions	(295,345)	(2951345)
Other (Net Transfer)		(75,468)	75,468
Net Changes	304,31 1                134,050		170,261
Balances at December 31 , 2024

	1% Lower   Current Discount     1% Higher        (6.25%)                   (7.25%)                  (8.25%)
Total Pension Liability	4,955,825                          4,479,285
Plan Fiduciary Net Position	4241 ,269                    4,241 ,269        4,241 ,269

Sensitivity of the Net Pension Liability to Changes in the Discount Rate. The following presents the plan’s net pension liability, calculated using a Single Discount Rate of 7.25%, as well as what the plan’s net pension liability would be if it were calculated using a Single Discount Rate that is 1% lower or 1% higher:

714,556

238,016

Net Pension Liability/(Asset)$ (1421771)

8. EmpLe.YE-ße.U!-emenLS.Etemg –

Illinois Municipal Retirement Fund — (Cont’d)

Pension Expense, Deferred Outflows of Resources, and Deferred Inflows of Resources Related to Pensions. For the year ended April 30, 2025, the employer recognized pension expense of $151 ,576 At April 30, 2025, the employer reported deferred outflows or resources and deferred inflows of resources related to pensions from the following sources:

	Deferred	Deferred
Deferred Amounts Related to Pensions	Outflows of	Inflows of
Deferred Amounts to be Recognized in Pension Expense in Future Periods	Resources	Resources
Differences between expected and actual experience	163,623	58,182
Changes of assumptions Net difference between projected and actual		2,603
earnings on pension plan investments	401 ,979	292,427

565,602

353,212

Total Deferred Amounts to be recognized in pension expense in future periods

16,005

Pension Contributions made subsequent to the Measurement Date      

Total Deferred Amounts Related to Pensions

581 ,607

353,212

Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense in future periods as follows:

                                                     Year Ending           Net Deferred Outflows

                                                   December 31,                  of Resources

• 96,375
• 216,987
• (59,690)
• (25,277)
• Thereafter

Total

Note 9. Accounts Receivable

Accounts receivable at April 30, 2025 consisted of the following:

                                                                     Governmental      Proprietary         Total

                   Intergovernmental                                  273,075            117,413      $ 390,488

                   Accounts                                                                        192273         192,273

Notes	67,818		67,818
Interest	37	20,873	201910
Other	9,614	5,386	15,000

                      Gross receivables                                                        335,945         686,489

Allowance for uncollectible

Net total receivables

Note 10. Interfund Balances

Interfund balances at April 30, 2025, consisted of the following:

	Nonmajor
Due From: Due To:	Governmental
General Fund	41320

The TIF #2 Fund owes the General Fund $4,320 for proceeds from the sale of TIF land that were deposited in error.

Note 11. Notes Receivable

The Revolving Loan Fund reflects community development loans receivable in the amount of $67,818. The loans bear interest at annual rates between 2.25 and 3 percent. The loans will be repaid over periods of up to 10 years. An allowance account has been determined to be unnecessary at April 30, 2025.

The TIF #2 Fund had one community development loan receivable in the amount of $12,500. The loan had an interest rate of 0% and was repaid in June 2024.

April 30, 2025 (Continued)

Note 12. Restricted Cash

Restricted cash in the amount of $633,095 is comprised of the following: In the General Fund, $87,919 is restricted for debt service. In the Water Fund, $193,441 is restricted for debt service. In the Sewer Fund, $351 , 735 is restricted for debt service.

Note 13. Gas Purchase Contract

During fiscal year 2020, the City entered into a 30-year contract for the purchase of natural gas from PEFA, Inc. The City anticipates realizing a discount to market index natural gas prices.

Note 14. Long-term Debt

Governmental long-term debt activity for the year ended April 30, 2025 was as follows:

                                                                            Beginning                                                     Ending

                                                                             Balance           Additions Payments            Balance

                2014 Alternate Revenue Bonds                                      $ 95,000

                Dump Truck Loan                                     60,588                                17,528              43,060

              Police Truck Loan                                      5,921

Total

The City of Grayville issued $2,030,000 of General Obligation Bonds (Alternate Revenue Source), Series 2014, during the 2015 fiscal year for the purpose of providing funds to acquire, construct, renovate, and improve streets, sidewalks and utilities within the City. The bonds carry interest rates varying from 0.60% to 4.30% over their life with principal due November 1 ^st each year and interest due May 1 ^st and November 1 ^st each year. The bonds have a maturity date of November 1, 2034. Bond payments are made from the General Fund. Debt service requirements at April 30, 2025 were as follows:

Year Ended

                              April 30              Principal              Interest                 Total

•       95,000 $ 45,21 1         140,21 1
• 1001000         41 , 773           141,773
• 105,000          38,004 143,004
• 1101000          33,890 143,890
• 115,000           29,474 144,474

                            2031-2035               650,000              70,940                720,940

                                Totals         

April 30, 2025 (Continued)

Note 14. Lengzte.!.m-P.eM (Cont’d)

On June 9, 2022 the City obtained a loan from Fairfield National Bank in the amount of $46,045 for the purchase of a police truck. The loan carried an interest rate of 3.29% and required quarterly payments of $5,971. The loan was paid off in June 2024.

On May 16, 2023 the City obtained a loan from Citizens National Bank in the amount of $73,125 for the purchase of a dump truck. The loan carries an interest rate of

5.45% and requires quarterly payments of $5,119. The loan matures on May 16, 2027. Debt service requirements at April 30, 2025 were as follows:

Year Ended

                            April 30              Principal             I nterest                 Total

2026	18,503		20,476
2027	19,532	944	20,476
2028	5,025	68	5,093

43,060

                                                    Totals$ 2,985                                         46,045

Beginning			Ending
Balance	Additions	Payments	Balance

Business-type long-term debt activity for the year ended April 30, 2025 was as follows:

Sewer Revenue Bonds 92-06 Sewer Revenue Bonds 92-07 Water Revenue Bonds 91-05 Meter Lease-Water Fund

$ 928,000                                 $ 16,000           $ 912,000          124,000                                 3,000           121 ,ooo          860,000                               20,000             840,000          602,831                                83,026            519,805 19,012

               Meter Lease-Gas Fund                         19,012

                   Total                                             $ 2,533,843                          $ 122,026        $ 2,41 1,817

On May 2, 2016, the City issued $1 of Sewer System Revenue Bonds, Series 2016A, for the purpose of constructing sewer line extensions. The bonds carry an interest rate of 2.25% with principal due May 1 ^st each year and interest due May 1 ^st and November 1 ^st each year. The bonds have a maturity date of May 1, 2056. Debt service requirements at April 30, 2025 are as follows:

April 30, 2025

(Continued)

Note 14. Long-term Debt (Cont’d)

Year Ended

                            April 30               Principal              Interest                  Total

•        24,000 $ 20,520          44,520
• 24,000          19,980 43,980
• 24,000          19,440 43 ,
• 24,000          18,900 42,900
• 24,000          18,360 42,360

                           2031-2035                 120,000               83,700                 203,700

                           2036-2040                 120,000               70,200                 190,200

                           2041-2045                 1601000              54,900                 214,900

                           2046-2050                 160,000               36,900                 196,900

                           2051-2055                 192,000               17,820                 209,820

                               2056                        40,000                    900                   40,900

                              Totals                $ 912,000            $ 361,620      

On May 21 2016, the City issued $140,000 of Sewer System Revenue Bonds, Series 2016B, for the purpose of constructing sewer line extensions. The bonds carry an interest rate of 2.5% with principal due May 1 ^st each year and interest due May 1 ^st and November 1 ^st each year. The bonds have a maturity date of May 1, 2056. Debt service requirements at April 30, 2025 are as follows:

Year Ended

                                    April 30               Principal               Interest                  Total

•           3,000   5,723
  • 3,000   2,655   5,655
  • 3,000   2,586   5,586
  • 3,000   2,520   5,520
  • 3,000   2,453   5,453

                                  2031-2035                   15,000              11 ,250                   26250

                                  2036-2040                   19,000                 9,428                   28,428

                                  2041-2045                   20,000                 7,200                  271200

                                  2046-2050                   22,000                 4,928                   26,928

                                  2051-2055                   25,000                 2,250                   27250

169,106

2056 5,000   113      Totals  121 ,ooo          481106

April 30, 2025

(Continued)

Note 14. Long-term Debt (Cont’d)

On May 2, 2016, the City issued $1 of Water System Revenue Bonds, Series 20161 for the purpose of constructing water line extensions. The bonds carry an interest rate of 2.25% with principal due May 1 ^st each year and interest due May 1 ^st and November 1 ^st each year. The bonds have a maturity date of May I l 2056. Debt service requirements at April 30, 2025 are as follows:

Year Ended

                                    April 30                   Interest                  Total

•             20,000 $ 18,900          38,900
  • 20,000   18,450 38,450
  • 20,000   18,000 38,000
  • 20,000   17,550 37,550
  • 20,000   17,100 37,100

                                  2031-2035                 100,000               78,750                 178,750

                                  2036-2040                 120,000               67,275                 187,275

                                  2041-2045                 150,000              51 , 750                201,750

                                  2046-2050                 150,000               34,874                 184,874

                                  2051-2055                 180,000              171325                197,325

                                       2056                        40,000                    900                   40,900

                                      Totals                $ 840,000            $ 340,874      

On July 26, 2018 the City entered into a lease agreement with BB Community Leasing Services, Inc. for the purchase of an automated meter information system. Final draws on the lease totaled $1 Amortization expense has been included in depreciation expense in the financial statements. The lease carries an interest rate of 4.09% with monthly payments of $8,880 due through November 1 } 2028, and a final payment of $220,000 due on December 1, 2028. The lease has been accounted for in the Water and Gas Funds. Debt service requirements at April 30, 2025 are as follows:

Year Ended

                                  April 30           _E.LQ.EIE!_           Interest                 Total

2026 86,488  20,076              106,564 2027 90,095 16,469 106,564 2028 93,851 12,713 106,564 2029 268,383 4,899 2731282

                                                                   538,817                    157                592,974

(Continued)

Note 15. Bond Compliance

Bond compliance for the General Fund bonds are as follows: There shall be established and administered by the City Treasurer the following separate funds and accounts:

1 . A Bond Proceeds Account shall be maintained and used solely for the purpose of (1) paying the costs of the Project in accordance with the plans and specifications approved by the City Council, (2) paying the costs and expenses of issuing the Bonds, (3) redeeming Bonds, and (4) paying capitalized interest on the Bonds for a period not to exceed two years from the issue date of the Bonds. Upon completion of the purpose for which the Bonds have been issued, any surplus remaining in the Bond Proceeds account shall be transferred to and deposited in the Bond Reserve Account.

2. A Bond Reserve Account shall be maintained and used solely for the purpose of carrying out the terms and conditions of the Bond Ordinance. The Treasurer shall deposit pledged taxes levied for the bonds into this account. In each calendar year, the Treasurer shall deposit such an amount until there is accumulated and held, before the abatement of pledged taxes, an amount sufficient to pay the principal and interest on the outstanding bonds due in the next succeeding bond year. Any money remaining in the Bond Reserve account after retirement of the indebtedness for which the Bonds were issued shall be paid into the City’s General Fund.

The City is in compliance with the above requirements at April 30, 2025.

Bond compliance for the Water & Sewer Fund bonds are as follows: There shall be established and administered by the City Treasurer the following separate funds and accounts:

1 . An Operations and Maintenance Fund shall be maintained into which sufficient funds shall be transferred to pay the estimated cost of expenses during the ensuing month.

• A Debt Service Fund shall be established into which monthly transfers shall be made equal to 1/6 of the amount of interest becoming due on the bonds on the next succeeding interest payment date and 1/12 of the amount of principal that will become due on the bonds on the next succeeding bond payment date.
• A Debt Service Reserve Fund must be maintained to prevent any default in the payment of the bonds. For the Sewer Fund bonds, a sum of $382 must be deposited each month until a sum of $45,773 is reached. For the Water Fund bonds, a sum of $324 must be deposited each month until a sum of $38,790 is reached.

(Continued)

Note 15. Bond Compliance (Cont’d)

• A Short-Lived Asset Fund must be maintained for the repair and replacement of the system. For the Sewer Fund, a monthly transfer of $833 is required until the bonds are paid off. For the Water Fund, a monthly transfer of $1 ,421 is required until the bonds are paid off.

The City is not in compliance with the Debt Service and Operations and Maintenance requirements for the Water and Sewer Bonds at April 30, 2025.

Note 16. Legal Debt Margin

                       Assessed Valuation – 2023                                          

Legal Debt Limit – 8.625% of assessed valuation

                     Amount of debt applicable to debt limit                                 (581 ,877)

762,302

Legal debt margin (deficit)

Chapter 65, Section 5/8-5-1 of the Illinois Compiled Statutes provides, “…no municipality having a population of less than 500,000 shall become indebted in any manner or for any purpose, to an amount, including existing indebtedness in the aggregate exceeding 8.25% on the value of the taxable property therein, to be ascertained by the last assessment for state and county purposes, previous to the incurring of the indebtedness or, until January 1, 1983, if greater, the sum that is produced by multiplying the municipality’s 1978 equalized assessed valuation by the debt limitation percentage in effect on January 1, 1979.”

Note 17. W-2E Inc.

W2Er Inc. is an Illinois not-for-profit corporation formed on September 1, 2022. It was formed for the purpose of owning and operating water supply facilities for drinking and general domestic use on a mutual or cooperative basis. It will finance, design, construct and thereafter own and operate a water treatment plant and the related appurtenances and distribution lines necessary to supply potable water to the Cities of Grayville and Albion.

The City of Grayville, Illinois is a member of W2E, Inc. along with the City of Albion, Illinois. Each of the two members have appointed 3 representatives to the corporation’s board of directors. Said directors then appointed a seventh director.

The City of Grayville will guarantee up to $6,000,000 of W2E, Inc.’s debt.

(Concluded)

Note 18. Transfers

Interfund transfers at April 30, 2025 consisted of the following:

Nonmajor

                  Transfer From:                           General         Governmental           Total

Transfer To:

                    Nonmajor Governmental       $ 134,612                                      $ 134,612

                  Sewer                                                                          65,049             65,049

                    Total                                       $ 134,612                   65,049       $ 1991661

The General Fund transferred $134,612 to the RLF Fund to offer additional small business loans. The TIF #2 Fund transferred $65,049 to the Sewer Fund for equipment purchases.

Required Supplementary Information

Fund Balances — Budget and Actual General Fund For the Year Ended April 30, 2025

Revenues

Property taxes                                                               

Licenses and permits

Intergovernmental

Replacement tax Sales and use tax Illinois income tax

Video gaming tax

Cannabis sales and use tax

Franchise tax

Grants

Total intergovernmental

Fines and fees

Charges for services

Miscellaneous

Oil royalties

Interest

Donations

Other

Lease income

Refunds/reimbursements

Sale of assets/materials Total miscellaneous

Total revenues

Original Budget    Budget   Actual

260,920

260,921

241,317

44,000	33,899	32,598
404,350	548,458	546,251
260,000	269,398	276,421
100,750	125,149	125,867
100,000	540,543	520,109
10,000	10,122	10,122
30,000	34,089	44,041

       22,500                   28,55728,747

      949,100         1 ,561 ,658

        10,000                   22,18922,189

25,000	27,702	28,275
IOO	2,903	3,036
400	11 ,405	216,405
9,500	25,882	7,855
8,540	8,130	8,130 5,170
	12,934	63,440

        18,700                   53,10253,202

        43,540                                94, 127332,311

1,285, 1572,252, 778

Total dog pound                                                                 21950                                            376376

Expenditures Current: General Government: Administration
Salaries and benefits		78,664                76,966              79,905
Contractual services		21 ,300                  59,503                58,744
Office supplies		4 , 350                  10,222                10,223
Training and travel		350                        225                     225
Insurance		5,081                  1 1,928               11 ,928
Telephone and utilities		18,400                  15,520                18,292
Supplies		2,750                     8,583                  4,975
Donations		7,500                     7,500                  7,400
Miscellaneous		10,500                    5,221                  6,506
Total administration Zoning	148,895                 195,668              198,198
Contractual services	500
Publishing/advertising	250                      254                     254
Total zoning	750                        254                     254

Dog pound
Contractual services	600	356                     356
Operating supplies	2,350	20                       20

Social Services: Cemeter
Salaries and benefits	104,715	105,978	1 06,379
Contractual services	9,000	6,699	6,698
Insurance		2,959	2,959
Supplies	14,300	1 1 ,069	11
Travel		49	49
Utilities	1 ,650	2,395	2,395
Office supplies	150	63	63
Total cemetery	131,266	129,212	129,613

Total general government                                               152,595                196,298              198,828

Original Budget    Budget        Actual

Streets and Roads:

Salaries and benefits          Insurance

Office expense

Telephone and utilities Contractual services

Materials and supplies

Miscellaneous

Rentals

Total streets and roads

Public Safety:

Police

Salaries and benefits

Contractual services

Dispatching

Office expense

Telephone and utilities Insurance

Miscellaneous

Materials and supplies

Cannabis tax rebate

Training and travel

Total police

96,537 3,002		83,894 6,471		84,960
250		342		342
23,180		31,508		31 ,507
19,400		23, 154		23,153
27,450		24,800		25,204
100		582		582

    2,100                    2,100                  2,100

422,998	406,278	400,003
18,300	20,648	13,881
34,500	34,500	34,500
5,910	3,754	3, 754
16,000	14,224	14223
6,528	20,883	20,883
5,000	5,182	20,236
23,000	47,322	46,540
	269,224	259,023
2,500	1 0, 477	10,478

172,019                172,851              174,319

Original      BudgetBudget    Actual

534,736832,492                               823,521

Culture and Recreation:

Salaries and benefits

Contractual services

Telephone and utilities

Supplies

Miscellaneous

Office expense

Travel and training

Insurance

Total library

Parks

Salaries and benefits

Insurance

Telephone and utilities Materials and supplies

Contractual services

Training and travel Miscellaneous

Office expense

Total parks

Total culture and recreation

Debt Service

Capital Outlay

Total expenditures

94 | 634		100,694		98,416
8,325		14,280		14,453
7,850 15,800 300 1 ,050		7,215 16,918		7,806 2,334 1 ,320
4,950		5,000		5,500

       725                    2,742                  2,742

29,184	24,541	24,541
1,708	5,356	5,356
25,300	28,027	28,026
10,500	16,606	10,573
14,525	29,597	29,596
1 ,ooo	885	885
	656	656
275	319	4,753

133,634                150,334              149,674

216,126

256,321

254,060

119,969	75,230	169,825
158,687	55,488	265,379

82,492                  105,987              104,386

Original Budget         Budget        Actual

(Concluded)

Original
Budget	Budget	Actual

$	(200,241)
	(84, 1 76)

302,662

Excess (deficiency) of revenues over expenditures$ 237,233

Other financing sources (uses)

Transfer in

Transfer out                                                                                                        (134,612)(134,612)

      Total other financing sources (uses)                                                             (134,612)  

168 050

                Net change in fund balance                                                                          $ (284,417)1 02,621

Fund balances – beginning

Fund balances – ending                                                                                                                    542,970

Revenues

Property taxes

Interest

Total revenues

Expenditures Current:

Economic development:

Engineering

Legal services

Consulting fees

Inducements

Public improvements Miscellaneous

Total expenditures

Excess (deficiency) of revenues over expenditures

Other financing sources (uses)

Transfer in (out)

Total other financing sources (uses)

Net change in fund balances

Fund balances – beginning

Fund balances – ending

TIF #1

2025

Original and

Final Budget       Actual

       300,000            421,914

3,495

300,000425,409

2,500	11938
2,000	2,235
200,000 50,000	240,998 500

1 ,ooo

44,500

179,738

         255,500              245,671

44,500

179,738

355,772

535,510

Illinois Municipal Retirement Fund Schedule of Changes in Net Pension Liability and Related Ratios

Calendar year ending December 31 ,

Total pension liability

Service cost

Interest on the total pension liability

Changes of benefit terms Differences between expected and actual experience Changes of assumptions

Benefit payments and refunds

Net change in total pension liability

Total pension liability – beginning

Total pension liability – ending (a)

Plan fiduciary net position

Contributions – employer Contributions – employee

Net investment income

Benefit payments and refunds

Other (Net Transfer)

Net change in plan fiduciary net position

Plan fiduciary net position – beginning

Plan fiduciary net position – ending (b)

City’s net pension liability – ending (a) – (b)

Plan fiduciary net position as a percentage of the total pension liability

Covered-employee payroll

69,195	59,023	64,410	55,891
294,488	302,145	288,619	274537
235,973	(186,934) (8,361)	104,936	137,452
(295,345)	(257,809)	(2791590)	(276,222)

304311                  (91,936)             1781375              1911658

4, 174,974

4,088,535

53,342	301864	45,221	62,805
37,507	31,709	30,282	26,713
414,014	447230	(663,305)	740,713
(295,345)	(257,809)	(279,590)	(276,222)
(75,468)	(75,690)	(32,062)	81,739

41266.910

134,050                176,304              (899,454)              635,748

238,016

67,755

335,995

(741,834)

   94.69%                98.38%                92.13%             118.14%

       8331467            704,650             672,942             593,620

April 30, 2025

       2024                    2023                     2022                   2021

City’s net pension liability as a percentage of covered-valuation payroll   28.56% 9.62%  49.93% -124.97%

Illinois Municipal Retirement Fund

Schedule of Changes in Net Pension Liability and Related Ratios April 30, 2025

(Concluded)

Calendar year ending December 31 ,

Total pension liability

Service cost                                                                            

Interest on the total pension liability

Changes of benefit terms Differences between expected and actual experiehce Changes of assumptions

Benefit payments and refunds

Net change in total pension liability

Total pension liability – beginning Total pension liability – ending (a)

Plan fiduciary net position

Contributions – employer                                                     

Contributions – employee

Net investment income

Benefit payments and refunds

Other (Net Transfer)

Net change in plan fiduciary net position

Plan fiduciary net position beginning

Plan fiduciary net position – ending (b)

City’s net pension liability – ending (a) – (b)

Plan fiduciary net position as a percentage of the total pension liability

63,349	52,028	48,087	551878
275,339	278,354	282,841	287,916
62,495	(94,424)	(5,140)	(131 ,330)
	104,559	(123,944)	(8,978)
(260,145)	(259,428)	(267,859)	(287,190)

Covered-employee payroll 2019     2018       2017       2016

   1411038                811089               (66,015)              (83,704)

3,881 ,097

3,896,171               3,881 ,097

48,095	67,405	72,384	871344
27,712	25,446	24,344	231966
677,499	(259,172)	651 ,869	230,908
(260,145)	(259,428)	(2671859)	(287,190)

          ,792)              (43,459)              (89,907)               31 ,359

                                (469208)              390,831                  86,387

173,974 504,305			(45,992)		410,854
	95.69%	87.06%		101.21%		89.41%
	615,817	565,478		540,987		532,582

City’s net pension liability as a percentage of covered-valuation payroll  28.25% 89.18% -8.50% 77.14%

Illinois Municipal Retirement Fund Schedule of Contributions April 30, 2025

Calendar Year	Actuarially		Contribution     Covered            Actual Contribution
Ending	Determined	Actual	Deficiency       Valuation                    as a % of
December 31 ,	Contribution	Contribution	(Excess)                            Covered Valuation Payroll
2015	81 ,287	$ 81,286			$537,610	15.12%
2016	87,343	87,344			532,582	16.40%
2017	72,384	72,384			540,987	13.38%
2018	67,405	67,405			565,478	11.92%
2019	481095	48,095			615,817
2020	60,009	60,009			568,803
2021	62,805	62,805			593,620
2022		45,221		1	672, 942	6.72%
2023	30,864	30,864			704,650	4.38%
2024	53,342	531342			833,467	6.40%

Notes to Schedule:

Summary of Actuarial Methods and Assumptions Used in the Calculation of the 2024 Contribution Rate*

Valuation Date:

Notes                                             Actuarially determined contribution rates are calculated as of December 31 each year, which is 12 months prior to the beginning of the fiscal year in which contributions are reported.

Methods and Assumptions Used to Determine 2024 Contribution Rates:

Actuarial Cost Method:	Aggregate entry age normal
Amortization Method:	Level percentage of payroll, closed
Remaining Amortization Period:	Non-taxing bodies: 10-year rolling period. Taxing bodies (Regular, SLEP and ECO groups): 19-year closed period Early Retirement Incentive Plan liabilities: a period up to 10 years selected by the Employer upon adoption of ERI.
Asset Valuation Method:	5-year smoothed market; 20% corridor
Wage Growth:	2.75%
Price Inflation:	2.25%
Salary Increases:	2.75% to 13.75%, including inflation
Investment Rate of Return:	7.25%
Retirement Age:	Experience-based table of rates that are specific to the type of eligibility condition; last updated for the 2020 valuation pursuant to an experience study of the period 2017-2019.
Mortality: Other Information:	For non-disabled retirees, the Pub-2010, Amount Weighted, below-median income, General, Retiree, Male (adjusted 106%) and Female (adjusted 105%) tables, and future mortality improvements projected using scale MP-2020. For disabled retirees, the Pub-2010, Amount Weighted, below-median income, General, Disabled Retiree, Male and Female (both unadjusted) tables, and future mortality improvements projected using scale MP-2020. For active members, the Pub-2010, Amount Weighted, below-median income, General, Employee, Male and Female (both unadjusted) tables, and future mortality improvements projected using scale MP-2020.
Notes:	There were no benefit changes during the year.

*Based on Valuation Assumptions used in the December 31 , 2022, actuarial valuation

Notes to the Required Supplementary Information

April 30, 2025

     Note 1.     Legal Compliance and Accountability

                       A.    Budgetary Control

The City follows these procedures in establishing the budgetary data reflected in the financial statements:

1 . The City Council proposes an operating budget for the fiscal year commencing the following May 1. The operating budget includes proposed expenditures and the means of financing them.

• Public hearings are conducted by the City to obtain taxpayer comments, if applicable.
• Subsequently, the budget is legally enacted through the passage of an ordinance.
• Formal budgetary integration is employed as a management control device during the year for the general and special revenue funds.
• Budgets for the governmental funds for which budgets have been adopted are adopted on a basis consistent with GAAP.
• Budgetary authority lapses at fiscal year-end.
• State law requires that Aexpenditures be made in conformity with appropriations/budget. As under the Budget Act, transfers between line items and departments may be made by administrative action. Amounts to be transferred between funds require City Board approval. The level of legal control is generally the fund budget in total.
• Budgeted amounts are as originally adopted, with the exceptions of Board approved transfers which were not material in relation to the budget taken as a whole.

The budget was approved on April 8, 2024 and was amended on May 27, 2025.

                        B.    Excess of Expenditures/Expenses over Budget in Major Governmental Funds

The General Fund had expenditures in excess of budgeted amounts of $297,653 for the fiscal year ending April 30, 2025.

Supplementary Information

Assets

Cash and cash equivalents

Receivables, net

Total assets

Liabilities and Fund Balances Liabilities:

Due to other funds Total liabilities

Fund balances:

Restricted for:

Economic development

Streets and roads

Committed to general government

Total fund balances

Total liabilities and fund balances

City of Grayville

White and Edwards County, Illinois

Combining Balance Sheet

Nonmajor Governmental Funds

April 30, 2025

Special Revenue Funds

Total

Nonmajor

     Motel         Motor       Revolving                           Business Governmental

       Tax        Fuel Tax        Loan          TIF #2       District           Funds

    $ 52,996     $ 239,694     $ 115,211      $ 281,587     $ 20,395              709,883

        4,741            5,488          67,818                            36,260               114,307

$ 57,737

$ 245,182

$ 183,029

$ 2811587

$ 56,655

824190

      571737                           183,029        277,267                                 518,033

                         182                                                                         245, 182

56,65556,655

      57,737        245,182        183,029        277267         56,655               819,870

$ 57,737

$ 245,182

$ 183,029

$ 281,587

$ 56,655

824,190

52

City of Grayville

White and Edwards County, Illinois

Combining Statement of Revenues, Expenditures, and Changes in Fund Balances

Nonmajor Governmental Funds

For the Year Ended April 30, 2025

Special Revenue Funds

Total

Motel	Motor	Revolving		Business	Governmental
Tax	Fuel Tax	Loan	TIF #2	District	Funds

Revenues
Property taxes			$ 146,584		146,584
Other taxes	61 ,955				61 ,955
Intergovernmental		70,030		56,655	126,685
Interest	343	2,136	1 ,6682,517		6,664

Nonmajor

     Total revenues                                         62,298           72,166            1 ,668       149,101        56,655         3411888

Expenditures Current:

Streets and roads                                                            136,636

Economic development                                                                        401624         54,

Excess (deficiency) of revenues
over expenditures	31729(38,956)	941398	56,655                51 ,356

     Total expenditures                                                                                624

Other financing sources (uses)
Transfers in (out)	(65,049)	69,563

Total other financing sources (uses)(65,049)69,563

120,919

819,870

698,951

Net change in fund balances

Fund balances – beginning

Fund balances – ending

     3,729         (64,470)         95,656          29,349       56,655

54,008           309,652          87,373       2471918

$ 57,737      $ 245,182      $ 183,029     $ 277,267    $ 56,655