7998-R1_ML&P_Hollis_2020-2021_AnnualReport_Web

TOWN OF HOLLIS, MAINE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2021

NOTE 12 - OTHER POST EMPLOYMENT BENEFIT (OPEB) PLAN (CONTINUED) Differences between Projected and Actual Earnings on OPEB Plan Investments Differences between projected and actual investment earnings are recognized in OPEB expense using a straight-line amortization method over a closed five-year period. The first year is recognized as OPEB expense and the remaining years are shown as either deferred outflows of resources or deferred inflows of resources. OPEB Plan Fiduciary Net Position Additional financial and actuarial information with respect to this Plan can be found at the Town Office at 34 Town Farm Road, Hollis, Maine 04042. NOTE 13 - TAX INCREMENT FINANCING DISTRICT The Town has established a tax increment financing district (TIF) in accordance with M.R.S.A. Title 30-A, §5221-§5235 to capture improvements made within the District and permit Tax Increment Financing for the Poland Spring Project. This project encompasses approximately 250 acres of taxable real estate, as well as personal property. The agreement provides for a portion (85%) of the new tax revenues generated by the increase in assessed value of the District to be captured and designated as TIF revenues. The remaining portion (15%) is retained in the Town’s general fund. The TIF revenues are used to offset those costs of financing building construction, site improvements and the purchase and installation of equipment within the District. Under the Tax Increment Financing District Credit Enhancement Agreement, a percentage of the captured TIF revenues (25% for the year ended June 30, 2021) has been paid to the Company to offset costs of building construction, site improvements and purchase and installation of equipment. The balance of the captured TIF revenues (75% for the year ended June 30, 2021) has been retained in the TIF fund to be used to pay for current year and future expenditures. NOTE 14 - RISK MANAGEMENT The Town is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions and natural disasters for which the Town participates in a public entity risk pool sponsored by the Maine Municipal Association. The Maine Municipal Association Group Risk Pool is a state-chartered pool established exclusively for Maine municipalities. The pool provides certain property, liability, fidelity and vehicle coverage. If the assets of the pool are at any time

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