Rating: Standard & Poors: AAA Stable Outlook

FINAL OFFICIAL STATEMENT DATED JANUARY 22, 2014

NEW ISSUE In the opinion of Edwards Wildman Palmer LLP, Bond Counsel, based upon an analysis of existing law and assuming,

among other matters, compliance with certain covenants, interest on the Bonds is excluded from gross income for federal income tax purposes under the Internal Revenue Code of 1986 (the “Code”). Interest on the Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although such interest is included in adjusted current earnings when calculating corporate alternative minimum taxable income. Under existing law, interest on the Bonds is exempt from Massachusetts personal income taxes, and the Bonds are exempt from Massachusetts personal property taxes. The Bonds will be designated as “qualified tax-exempt obligations” for purposes of Section 265(b)(3) of the Code. Bond Counsel expresses no opinion regarding any other tax consequences related to the ownership or disposition of, or the accrual or receipt of interest on, the Bonds. See “Tax Exemption” herein.

$4,672,000 TOWN OF MASHPEE, MASSACHUSETTS

General Obligation Municipal Purpose Loan of 2014 Bonds Book-Entry-Only Bank-Qualified

Dated: January 31, 2014 Due: (As shown below)

MATURITIES, AMOUNTS, RATES, YIELDS AND CUSIP NUMBERS

Due: Principal Cusip Due: Principal Cusip

January 15 Amount Rate Yield 574760 January 15 Amount Rate Yield 574760

2015 ….…. $452,000 2.000% 0.35% LL6 2022 ….…. $290,000 4.000% 2.00% LT9

2016 ….…. 420,000 2.000 0.39 LM4 2023 ….…. 290,000 4.000 2.25 LU6 2017 ….…. 420,000 3.000 0.54 LN2 2024 ….…. 285,000 4.000 2.35 LV4

2018 …….. 420,000 3.000 0.86 LP7 2025 ….…. 280,000 2.750 2.50 LW2

2019 ….…. 405,000 4.000 1.20 LQ5 2026 ….…. 275,000 3.000 2.65 LX0

2020 ….…. 295,000 3.000 1.50 LR3 2027 ….…. 240,000 3.000 2.75 LY8

2021 ….…. 295,000 4.000 1.80 LS1

$305,000 Coupon 3.50% Term Bond Maturing January 15, 2029 to yield @ 3.00% Cusip # 574760 MA9

Principal of the Bonds will be payable on January 15 of the years in which the Bonds mature. Interest will be payable on July 15, 2014 and semi-annually thereafter on each January 15 and July 15. The Bonds maturing on and before January 15, 2024 are not subject to redemption prior to their stated dates of maturity. Bonds maturing after January 15, 2024 are subject to redemption in accordance with the terms described herein.

The Bonds will be issued by means of a book-entry system, evidencing ownership of the Bonds in principal amounts of $5,000 or integral multiples thereof, with the exception of one denomination in the principal amount of $2,000 maturing January 15, 2015, with transfers of ownership effected on the records of The Depository Trust Company, New York, New York, (“DTC”), and its participants pursuant to rules and procedures adopted by DTC participants. No physical distribution of the Bonds will be made to the public. One certificate for each maturity of the Bonds will be issued to DTC, and immobilized in its custody.

The Bonds will be approved by Edwards Wildman Palmer LLP, Boston, Massachusetts, Bond Counsel to the Town. It is expected that the Bonds, in definitive form, will be delivered to DTC, or its custodial agent, on or about January 31, 2014 against payment in Federal Reserve Funds.

FTN FINANCIAL CAPITAL MARKETS

TABLE OF CONTENTS

Page Page

NOTICE OF SALE ........................................................................... i 

OFFICIAL STATEMENT................................................................ 1 

INTRODUCTION ............................................................................ 1 

THE BONDS .................................................................................... 1 Description of the Bonds .......................................................... 1 Record Date .............................................................................. 2 Book-Entry-Only System ......................................................... 2 DTC Practices ........................................................................... 3 Optional Redemption ................................................................ 3 Mandatory Redemption ............................................................ 4 Notice of Redemption ............................................................... 4 Authorization and Use of Proceeds ........................................... 4 Tax Exemption ......................................................................... 4 Security and Remedies ............................................................. 6 Continuing Disclosure .............................................................. 8 Bank Eligibility......................................................................... 8 Rating ....................................................................................... 8 Financial Advisor ..................................................................... 8 Opinion of Bond Counsel ......................................................... 8 

THE TOWN ..................................................................................... 9 Services .................................................................................... 9 Principal Facilities .................................................................... 9 Governing Bodies and Officers ................................................ 9 Principal Executive Officers ................................................... 10 Collective Bargaining ............................................................. 10 Other Data .............................................................................. 11 Population ............................................................................... 11 Median Age ............................................................................ 11 Median Value Owner-Occupied Housing Units ..................... 11 Age of Housing Units ............................................................. 12 Per Capita Income .................................................................. 12 Family Income ........................................................................ 12 Household Income .................................................................. 12 Unemployment ....................................................................... 13 Employment and Payrolls ....................................................... 13 Building Permits ..................................................................... 13 Principal Employers ............................................................... 14 Public School Facilities .......................................................... 14 Public School Enrollments ..................................................... 14 

INDEBTEDNESS .......................................................................... 15 Debt Limits ............................................................................. 15 

Types of Obligations ............................................................... 15 Debt Summary ........................................................................ 17 Bonded Debt vs. Population, Valuations and Income ............. 17 Five Years Outstanding Debt .................................................. 18 Revenue Anticipation Borrowing ............................................ 18 Principal Repayment Schedule ................................................ 19 Overlapping Debt .................................................................... 19 Authorized Unissued Debt and Prospective Financing ........... 20 

PROPERTY TAXATION ............................................................... 20 Tax Levy Computation ............................................................ 21 Taxation to Meet Deficits ........................................................ 21 Property Tax Limitation .......................................................... 22 Analysis of Property Tax Levies and Levy Limits .................. 23 Tax Rates and Valuations ........................................................ 23 Tax Levies and Collections ..................................................... 25 Taking and Sale ....................................................................... 25 Taxes Outstanding ................................................................... 25 Abatements and Overlay ......................................................... 26 Ten Largest Taxpayers ............................................................ 26 Cape Cod Open Space Land Acquisition Excise Tax .............. 26 Community Preservation Act .................................................. 27 

TOWN FINANCES ........................................................................ 28 Budget and Appropriation Process .......................................... 28 Operating Budget Trends ........................................................ 28 Retirement Plan ....................................................................... 29 Other Post-Employment Benefits ............................................ 30 State School Building Assistance Program ............................. 30 Investments ............................................................................. 31 Contractual Obligations ........................................................... 31 Motor Vehicle Excise .............................................................. 32 Other Taxes ............................................................................. 32 State Aid .................................................................................. 33 Undesignated General Fund Balance and Free Cash ............... 33 Stabilization Fund ................................................................... 34 Financial Statements ............................................................... 34 Litigation ................................................................................. 34 APPENDIX A. Comparative Financial Statements APPENDIX B. Audited Financial Statements APPENDIX C. Proposed Form of Legal Opinion APPENDIX D. Proposed Form of Continuing Disclosure APPENDIX E. Bid Form

________________________

The information and expressions of opinion in this Official Statement are subject to change without notice. Neither the delivery of this Official Statement nor any sale of the Bonds shall, under any circumstances, create any implication that there has been no material change in the affairs of the Town since the date of this Official Statement.

TOWN OF MASHPEE, MASSACHUSETTS

$4,672,000

GENERAL OBLIGATION MUNICIPAL PURPOSE LOAN OF 2014 BONDS

Book-Entry-Only

Bank-Qualified

NOTICE OF SALE

The Town of Mashpee, Massachusetts, will receive proposals until 11:00 A.M. (local time) on Wednesday, January 22, 2014, at Eastern Bank, Boston, Massachusetts, for the purchase of the following described Bonds:

$4,672,000 General Obligation Municipal Purpose Loan of 2014 Bonds payable as follows:

Due

January 15 Principal

AmountDue

January 15 Principal

Amount

2015 $452,000 2023 $290,000 2016 420,000 2024 285,000 2017 420,000 2025 280,000* 2018 420,000 2026 275,000* 2019 405,000 2027 240,000* 2020 295,000 2028 210,000* 2021 295,000 2029 95,000* 2022 290,000

* Callable maturities may be combined into one or two Term Bonds as provided for herein. The Bonds will be dated January 31, 2014. Principal on the Bonds will be payable on January 15 of the years in

which the Bonds mature. Interest will be payable on July 15, 2014 and semi-annually thereafter on each January 15 and July 15.

The Bonds maturing on and before January 15, 2024 are not subject to redemption prior to their stated dates of

maturity. Bonds maturing after January 15, 2024 are subject to redemption prior to their stated dates of maturity, at the

option of the Town, on and after January 15, 2024 either in whole or in part at any time, and if in part, by lot within a maturity at the price of par plus accrued interest to the date set for redemption.

The Bonds will be issued by means of a book-entry system, evidencing ownership of the Bonds in principal

amounts of $5,000 or integral multiples thereof, with the exception of one denomination in the principal amount of $2,000 maturing January 15, 2015, with transfers of ownership effected on the records of The Depository Trust Company, New York, New York, (“DTC”), and its participants pursuant to rules and procedures adopted by DTC participants. No physical distribution of the Bonds will be made to the public. One certificate for each maturity of the Bonds will be issued to DTC, and immobilized in its custody. The winning bidder, as a condition of delivery of the Bonds, shall be required to deposit the Bonds with DTC, registered in the name of Cede & Co.

The original Bonds to be immobilized at DTC will be prepared and their legality approved by Edwards Wildman Palmer LLP, Boston, Massachusetts, whose opinion will be furnished to the purchaser without charge.

No bid of less than par PLUS A PREMIUM OF NOT LESS THAN $50,000 will be considered.

Bidder(s) shall state the rate or rates of interest per annum which the Bonds are to bear in a multiple of 1/8th or 1/20th of 1%, but shall not state: (a) more than one interest rate for any Bonds having a like maturity; (b) any interest rate which exceeds the interest rate stated for any other Bonds by more than 3%.

As between proposals that comply with this Notice of Sale, the award will be to the bidder who offers to purchase all the Bonds at the lowest net effective interest rate to the Town. Such interest rate shall be determined on a true

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interest cost (TIC) basis, which shall mean that rate which, as of January 31, 2014, discounts semi-annually all future payments on account of principal and interest on the Bonds to the price bid, not including interest accrued to the date of delivery, if any, which accrued interest shall be paid by the successful bidder.

Electronic proposals will be submitted through PARITY/i-Deal™. If any provisions in this Notice of Sale conflict with information provided by PARITY/i-Deal™ this Notice of Sale shall control. Further information about PARITY, including any fees charged, may be obtained from i-Deal at (212) 404-8102. The Town assumes no responsibility or liability for bids submitted in this manner.

An electronic bid made in accordance with this Notice of Sale shall be deemed an offer to purchase the Bonds in accordance with the terms provided in this Notice of Sale and shall be binding upon the bidder as if made by a signed and sealed written bid delivered to the Town.

Other bids, including bids delivered by telegram, should be sealed, marked “Proposal for Bonds” and addressed to Craig Mayen, Treasurer, Town of Mashpee, Massachusetts, c/o Eastern Bank, Municipal Finance Department, Second Floor, 265 Franklin Street, Boston, Massachusetts 02110. Proposals delivered as specified will be accepted. Blank bid forms with signature may be faxed to Eastern Bank prior to submitting bids at (617) 235-8110, with actual bids telephoned to (617) 235-8104 or (617) 235-8106, at least one half hour prior to the 11:00 AM (local time) sale and after receipt of the faxed bid form by Eastern Bank which will act as agent for the bidder(s) in submitting the final sealed bids. Neither the Town nor Eastern Bank shall be responsible for bids submitted in this manner. Any bidder who submits a winning bid by telephone in accordance with this Notice of Sale shall be required to provide written confirmation of the terms of the bid by faxing or e-mailing a completed, signed bid form to Eastern Bank by not later than 11:30 A.M. on the date of sale. A good faith deposit is not required.

The award of the Bonds to the winning bidder will not be effective until the bid has been approved by the Treasurer and the Board of Selectmen.

The Town has not contracted for the issuance of any policy of municipal bond insurance for the Bonds. If the

Bonds qualify for issuance of any such policy or commitment therefore, any purchase of such insurance or commitment shall be at the sole option and expense of the bidder. Proposals shall not be conditioned upon the issuance of any such policy or commitment. Any failure of the Bonds to be so insured or of any such policy or commitment to be issued shall not in any way relieve the purchaser of their contractual obligations arising from the acceptance of their proposal for the purchase of the Bonds. Should the bidder purchase municipal bond insurance, all expenses associated with such policy or commitment will be borne by the bidder.

On or prior to the date of delivery of the Bonds, the successful bidder shall furnish to the Town a certificate acceptable to Edwards Wildman Palmer LLP (“Bond Counsel”) generally to the effect that (i) as of January 22, 2014 (the “Sale Date”), the successful bidder had offered or reasonably expected to offer all of the Bonds to the general public (excluding bond houses, brokers, or similar persons acting in the capacity of underwriters or wholesalers) in a bona fide public offering at the prices set forth in such certificate, plus accrued interest, if any, (ii) such prices represent fair market prices of the Bonds as of the Sale Date, and (iii) as of the date of such certificate, all of the Bonds have been offered to the general public in a bona fide offering at the prices shown set forth in such certificate, and at least 10% of each maturity of the Bonds actually has been sold to the general public at such prices. To the extent the certifications described in the preceding sentence are not factually accurate with respect to the reoffering of the Bonds, Bond Counsel should be consulted by the bidder as to alternative certifications that will be suitable to establish the “issue price” of the Bonds for federal tax law purposes. If a municipal bond insurance policy or similar credit enhancement is obtained with respect to the Bonds by the successful bidder, such bidder will also be required to certify as to the net present value savings on the Bonds resulting from payment of insurance premiums or other credit enhancement fees.

It shall be a condition of the obligation of the successful bidder to accept delivery of and pay for the Bonds that it shall be furnished, without cost, with (a) the approving opinion of the firm of Edwards Wildman Palmer LLP, Boston, Massachusetts, substantially in the form presented in Appendix C to the Preliminary Official Statement, included herein, (b) a certificate in form satisfactory to said firm dated as of the date of delivery of the Bonds and receipt of payment therefore to the effect that there is no litigation pending or, to the knowledge of the signers thereof, threatened affecting the validity of the Bonds or the power of the Town to levy and collect taxes to pay them, (c) a certificate of the Town Treasurer to the effect that to the best of the signer’s knowledge and belief, both as of the date of sale and as of the date of delivery of the Bonds, the Official Statement does not contain any untrue statement of a material fact and does not omit to state a material fact necessary to make the statements made herein, in the light of the circumstances

iii

under which they were made, not misleading and (d) a Continuing Disclosure Certificate in the form described in the Preliminary Official Statement, and substantially in the form presented in Appendix D.

In order to assist bidders in complying with Rule 15c2-12 promulgated by the Securities and Exchange Commission (the “Rule”), the Town will undertake to provide annual reports and notices of certain significant events. A description of this undertaking is set forth in the Preliminary Official Statement and the proposed form of Continuing Disclosure Certificate is provided in Appendix D, thereto.

It is anticipated that CUSIP identification numbers will be printed on the Bonds. All expenses in relation to the printing of CUSIP numbers on the Bonds shall be paid for by the Town; provided, however, that the Town assumes no responsibility for any CUSIP Service Bureau or other charge that may be imposed for the assignment of such numbers.

The Bonds will be designated as “qualified tax-exempt obligations” for purposes of Section 265(b)(3) of the Code.

The Bonds, in definitive form, will be delivered to the purchaser at DTC, or its custodial agent, on or about January 31, 2014 against payment in federal reserve funds.

Additional information concerning the Town and the Bonds is contained in the Preliminary Official Statement dated January 13, 2014, to which prospective bidders are directed. The Preliminary Official Statement is provided for informational purposes only and is not deemed a part of this Notice of Sale. Copies of the Preliminary Official Statement and a suggested form of the proposal for the Bonds may be obtained from Eastern Bank, Municipal Finance Department, Second Floor, 265 Franklin Street, Boston, Massachusetts 02110, telephone: (617) 235-8104. The Preliminary Official Statement is deemed final by the Town as of its date for purposes of the Rule except for the omission of the reoffering prices, interest rates and any other terms of the Bonds depending on such matters and the identity of the purchasers. Within seven (7) business days following the award of the Bonds in accordance herewith, no more than 50 copies of the Final Official Statement will be furnished to the successful bidder. Additional copies may be obtained at the purchaser’s expense.

The right is reserved to reject all bids and to reject any bid not complying with this Notice of Sale and, so far as permitted by law, to waive any irregularity with respect to any proposal for the Bonds. Town of Mashpee, Massachusetts

By: /s/ Craig Mayen, Treasurer

Dated: January 13, 2014

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CONTACT INFORMATION: ISSUER Town of Mashpee, MA 16 Great Neck Road Mashpee, MA 02649

Craig Mayen, Treasurer Tel: 508-539-1400 Ext. 8524 Fax: 508-539-1446

Email: cmayen@mashpeema.gov BOND COUNSEL Edwards Wildman Palmer LLP 111 Huntington Avenue Boston, MA 02199-7613

Richard A. Manley, Jr. Tel: 617-239-0384

Fax: 617-227-4420 E-Mail: rmanley@edwardswildman.com

FINANCIAL ADVISOR Eastern Bank Municipal Finance – 2nd Floor 265 Franklin Street Boston, MA 02110

Maureen E. Pacella Tel: 617-235-8104 Fax: 617-235-8110

E-Mail: m.pacella@easternbank.com PAYING AGENT U.S. Bank National Association One Federal Street Boston, MA 02110 Todd Dinezza Tel: 617-603-6573

Fax: 617-603-6668 Email: todd.dinezza@usbank.com

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OFFICIAL STATEMENT

TOWN OF MASHPEE, MASSACHUSETTS

$4,672,000

GENERAL OBLIGATION MUNICIPAL PURPOSE LOAN OF 2014 BONDS

BANK QUALIFIED

INTRODUCTION

This Official Statement is provided for the purpose of presenting certain information relating to the Town of Mashpee, Massachusetts (the “Town”) in connection with the sale of its $4,672,000 General Obligation Municipal Purpose Loan of 2014 Bonds (the “Bonds”).

The Bonds will be general obligations of the Town for which its full faith and credit are pledged. They are not guaranteed by The Commonwealth of Massachusetts (the “Commonwealth”) or any other entity. Principal and interest on the Bonds are payable from taxes which may be levied upon all taxable property in the Town subject to the limit imposed by Chapter 59, Section 21C of the Massachusetts General Laws with respect to that portion of the principal and interest payments that the Town has not voted to exempt from that limit. See also “Proposed Form of Legal Opinion” in Appendix C.

Questions regarding information contained in this Official Statement or other matters should be directed to the

following: Craig Mayen, Treasurer, (508) 539-1400 ext. 8524 or Maureen E. Pacella, Vice President, Eastern Bank, (617) 235-8104.

The information contained herein has been obtained from the sources indicated or from the Town.

THE BONDS Description of the Bonds

The Bonds will be dated January 31, 2014, and will bear interest payable on July 15, 2014 and semi-annually

thereafter on each January 15 and July 15. Interest will be calculated on the basis of a 30-day month and a 360-day year. Principal on the Bonds will be payable on January 15 of the years and in the amounts shown on the cover of this Official Statement.

Principal and semi-annual interest on the Bonds will be paid by U.S. Bank National Association, Boston,

Massachusetts, as Paying Agent (the “Paying Agent”). So long as The Depository Trust Company, New York, New York, (“DTC”), or its nominee, Cede & Co., is the Bondowner, such payments will be made directly to such Bondowner. Disbursement of such payments to the DTC participants is the responsibility of DTC and disbursement of such payments to the Beneficial Owners is the responsibility of the DTC Participants and Indirect Participants, as more fully described herein.

The Bonds will be issued by means of a book-entry system, evidencing ownership of the Bonds in principal amounts of $5,000 or integral multiples thereof, with the exception of one denomination in the principal amount of $2,000 maturing January 15, 2015, with transfers of ownership effected on the records of DTC and its participants pursuant to rules and procedures adopted by DTC participants. No physical distribution of the Bonds will be made to the public. One certificate for each maturity of the Bonds will be issued to DTC, and immobilized in its custody.

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Record Date

The record date for each payment of interest on the Bonds is the last business day of the month preceding the interest payment date provided that, with respect to overdue interest, the Paying Agent may establish a special record date. The special record date may not be more than twenty (20) days before the date set for payment. The Paying Agent will mail notice of a special record date to the Bondholders at least ten (10) days before the special record date.

Book-Entry-Only System

The Depository Trust Company ("DTC"), New York, NY, will act as securities depository for the Bonds. The

Bonds will be issued in fully-registered form registered in the name of Cede & Co. (DTC's partnership nominee) or such other name as may be requested by an authorized representative of DTC. One-fully registered certificate will be issued for each maturity of the Bonds, each in the aggregate principal amount of such maturity, and will be deposited with DTC.

DTC, the world's largest depository, is a limited-purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC's participants ("Direct Participants") deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants' accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ("DTCC"). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). DTC has a Standard & Poor's rating of AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com and www.dtc.org.

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

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

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

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Redemption notices shall be sent to DTC. If less than all of a maturity is being redeemed, DTC’s practice is to be determined by lot the amount of the interest of each direct Participant in such maturity to be redeemed.

Neither DTC nor Cede & Co. (nor such other DTC nominee) will consent or vote with respect to securities deposited with it unless authorized by a Direct Participant in accordance with DTC's MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the issuer of such securities or its paying agent as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts the securities are credited on the record date (identified in a listing attached to the Omnibus Proxy).

Principal and interest payments on securities deposited with DTC will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the issuer of such securities or its paying agent, on the payable dated in accordance with their respective holdings shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC (nor its nominee), the issuer of such securities or its paying agent, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal and interest to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the issuer of such securities or its paying agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

DTC may discontinue providing its services as depository with respect to securities held by it at any time by giving reasonable notice to the issuer of such securities or its paying agent. Under such circumstances, in the event that a successor depository is not obtained, physical certificates are required to be printed and delivered to Beneficial Owners.

The Town may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, physical certificates will be printed and delivered to Beneficial Owners.

The information in this section concerning DTC and DTC's book-entry system has been obtained from sources that the Town believes to be reliable, but the Town takes no responsibility for the accuracy thereof.

DTC Practices

The Town can make no assurances that DTC, Direct Participants, Indirect Participants or other nominees of the Beneficial Owners of the Bonds will act in a manner described in this Official Statement. DTC is required to act according to rules and procedures established by DTC and its participants which are on file with the Securities and Exchange Commission.

Optional Redemption

The Bonds maturing on and before January 15, 2024 are not subject to redemption prior to their stated dates of maturity.

Bonds maturing after January 15, 2024 are subject to redemption prior to their stated dates of maturity, at the option of the Town, on or after January 15, 2024, either in whole or in part at any time, and if in part, by lot within a maturity at the price of par plus accrued interest to the date set for redemption.

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Mandatory Redemption The Bonds maturing on January 15, 2028 and January 15, 2029 (the “Term Bonds”) unless called for earlier

redemption as provided above, shall be retired in part prior to maturity by mandatory serial redemptions in the principal amounts specified below, at a price equal to the principal amount to be redeemed (without premium) plus accrued interest to the redemption date:

Bond due January 15, 2029

Date Principal Amount

January 15, 2028 $210,000 January 15, 2029 (Maturity) 95,000

Notice of Redemption

Notice of any redemption of Bonds prior to their dates of maturity, specifying the Bonds (or portion thereof) to be redeemed and the place or places of payment shall be mailed to DTC (so long as it is the registered owner of the Bonds) not more than 60 days nor less than 30 days prior to the redemption date. Any failure by DTC to notify the DTC Participants of the redemption, or failure on the part of the DTC Participants or a nominee of a Beneficial Owner to notify the Beneficial Owner of the redemption shall not affect the validity of the redemption.

Authorization and Use of Proceeds

The following table sets forth the principal amount and description of each authorization included in this issue. Bond

AnticipationAmount of Amount Date of Statutory Notes This Issue Purpose Authorized Authorization and Article Reference Outstanding

$ 1,446,000 Remodeling Various Buildings $1,500,000.00 May 2, 2011 (Art. 4) Ch.44 S.7(3A) $ 1,446,000 495,000 Pumper Fire Truck 500,000.00 May 7, 2012 (Art. 4) Ch.44 S.7(9) 500,000 171,700 Horseshoe Bend Land Taking 227,834.00 May 3, 2010 (Art. 17) Ch.44 S.7(3) 209,834 88,200 Bayshore/Brookside Land Taking 129,838.00 October 18, 2010 (Art. 10) Ch.44 S.7(6) 101,502 202,600 Cape Drive Roadways 259,423.20 October 18, 2010 (Art. 8) Ch.44 S.7(6) 204,023 92,200 Great Estates Roadways 153,290.00 October 17, 2011 (Art. 20) Ch.44 S.7(3) 138,500 200,000 Sherwood Drive Roadways 248,048.00 October 15, 2012 (Art. 13) Ch.44 S.7(3) 248,084 676,500 Timberland Shores Roadways 865,594.00 October 15, 2012 (Art. 14) Ch.44 S.7(3) 865,594 36,200 Ockway Bay Roadways 50,663.00 October 15, 2012 (Art. 15) Ch.44 S.7(3) 50,663 146,500 Quail Hollow Roadways 176,906.00 October 15, 2012 (Art. 16) Ch.44 S.7(3) 176,906 59,600 Sandy Fox/Fox Hill Roadways 87,395.00 October 15, 2012 (Art. 17) Ch.44 S.7(3) 87,395 487,400 Sarakumit Roadways 536,405.00 October 15, 2012 (Art. 18) Ch.44 S.7(3) 536,405 93,100 Pleasant Park Drive Roadways 114,842.00 October 15, 2012 (Art. 19) Ch.44 S.7(3) 114,842 477,000 Santuit Woods Roadways 513,912.00 October 15, 2012 (Art. 20) Ch.44 S.7(3) 513,912

$ 4,672,000 5,364,150.20 $ 5,193,660 (1)

__________________________ (1) Revenue funds in the amount of $521,660 will be applied to the payment of principal of the Bond Anticipation Notes at their maturity

on January 31, 2014.

Tax Exemption

In the opinion of Edwards Wildman Palmer LLP, Bond Counsel to the Town (“Bond Counsel”), based upon an analysis of existing laws, regulations, rulings, and court decisions, and assuming, among other matters, compliance with certain covenants, interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 (the “Code”). Bond Counsel is of the further opinion that interest on the Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings when calculating

5

corporate alternative minimum taxable income. In the opinion of Bond Counsel, the Bonds are “qualified tax-exempt obligations” for purposes of Section 265(b)(3) of the Code. Bond Counsel expresses no opinion regarding any other federal tax consequences arising with respect to the ownership or disposition of, or the accrual or receipt of interest on, the Bonds.

The Code imposes various requirements relating to the exclusion from gross income for federal income tax purposes of interest on obligations such as the Bonds. Failure to comply with these requirements may result in interest on the Bonds being included in gross income for federal income tax purposes, possibly from the date of original issuance of the Bonds. The Town has covenanted to comply with such requirements to ensure that interest on the Bonds will not be included in federal gross income. The opinion of Bond Counsel assumes compliance with these requirements.

Bond Counsel is also of the opinion that, under existing law, interest on the Bonds is exempt from Massachusetts personal income taxes, and the Bonds are exempt from Massachusetts personal property taxes. Bond Counsel has not opined as to other Massachusetts tax consequences arising with respect to the Bonds. Prospective Bondholders should be aware, however, that the Bonds are included in the measure of Massachusetts estate and inheritance taxes, and the Bonds and the interest thereon are included in the measure of certain Massachusetts corporate excise and franchise taxes. Bond Counsel expresses no opinion as to the taxability of the Bonds or the income therefrom or any other tax consequences arising with respect to the Bonds under the laws of any state other than Massachusetts. A complete copy of the proposed form of opinion of Bond Counsel is set forth in Appendix C hereto.

To the extent the issue price of any maturity of the Bonds is less than the amount to be paid at maturity of such Bonds (excluding amounts stated to be interest and payable at least annually over the term of such Bonds), the difference constitutes “original issue discount,” the accrual of which, to the extent properly allocable to each owner thereof, is treated as interest on the Bonds which is excluded from gross income for federal income tax purposes and is exempt from Massachusetts personal income taxes. For this purpose, the issue price of a particular maturity of the Bonds is the first price at which a substantial amount of such maturity of the Bonds is sold to the public (excluding bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers). The original issue discount with respect to any maturity of the Bonds accrues daily over the term to maturity of such Bonds on the basis of a constant interest rate compounded semiannually (with straight-line interpolations between compounding dates). The accruing original issue discount is added to the adjusted basis of such Bonds to determine taxable gain or loss upon disposition (including sale, redemption, or payment on maturity) of such Bonds. Bondholders should consult their own tax advisors with respect to the tax consequences of ownership of Bonds with original issue discount, including the treatment of purchasers who do not purchase such Bonds in the original offering to the public at the first price at which a substantial amount of such Bonds is sold to the public.

Bonds purchased, whether at original issuance or otherwise, for an amount greater than the stated principal amount to be paid at maturity of such Bonds, or, in some cases, at the earlier redemption date of such Bonds (“Premium Bonds”), will be treated as having amortizable bond premium for federal income tax purposes and Massachusetts personal income tax purposes. No deduction is allowable for the amortizable bond premium in the case of obligations, such as the Premium Bonds, the interest on which is excluded from gross income for federal income tax purposes. However, a Bondholder’s basis in a Premium Bond will be reduced by the amount of amortizable bond premium properly allocable to such Bondholder. Holders of Premium Bonds should consult their own tax advisors with respect to the proper treatment of amortizable bond premium in their particular circumstances.

Bond Counsel has not undertaken to determine (or to inform any person) whether any actions taken (or not taken) or events occurring (or not occurring) after the date of issuance of the Bonds may adversely affect the value and marketability of, or the tax status of interest on, the Bonds.

Prospective Bondholders should be aware that from time to time legislation is or may be proposed which, if enacted into law, could result in interest on the Bonds being subject directly or indirectly to federal income taxation, or otherwise prevent Bondholders from realizing the full benefit provided under current federal tax law of the exclusion of interest on the Bonds from gross income. To date, no such legislation has been enacted into law. However, it is not possible to predict whether any such legislation will be enacted into law. Further, no assurance can be given that any pending or future legislation, including amendments to the Code, if enacted into law, or any proposed legislation, including amendments to the Code, or any future judicial, regulatory or administrative interpretation or development

6

with respect to existing law, will not adversely affect the market value and marketability of, or the tax status of interest on, the Bonds. Prospective Bondholders are urged to consult their own tax advisors with respect to any such legislation, interpretation or development.

Although Bond Counsel is of the opinion that interest on the Bonds is excluded from gross income for federal income tax purposes and is exempt from Massachusetts personal income taxes, the ownership or disposition of, or the accrual or receipt of interest on, the Bonds may otherwise affect the federal or state tax liability of a Bondholder. Among other possible consequences of ownership or disposition of, or the accrual or receipt of interest on, the Bonds, the Code requires recipients of certain social security and certain railroad retirement benefits to take into account receipts or accruals of interest on the Bonds in determining the portion of such benefits that are included in gross income. The nature and extent of all such other tax consequences will depend upon the particular tax status of the Bondholder or the Bondholder’s other items of income, deduction or exclusion. Bond Counsel expresses no opinion regarding any such other tax consequences, and Bondholders should consult with their own tax advisors with respect to such consequences.

Security and Remedies

Full Faith and Credit. General obligation bonds and notes of a Massachusetts city or town constitute a pledge of its full faith and credit. Payment is not limited to a particular fund or revenue source. Except for “qualified bonds” as described above (see “Serial Bonds and Notes” under “INDEBTEDNESS - TYPES OF OBLIGATIONS” below) and setoffs of state distributions as described below (see “State Distributions” below), no provision is made by the Massachusetts statutes for priorities among bonds and notes and other general obligations, although the use of certain moneys may be restricted.

Tax Levy. The Massachusetts statutes direct the municipal assessors to include annually in the tax levy for the next fiscal year “all debt and interest charges matured and maturing during the next fiscal year and not otherwise provided for [and] all amounts necessary to satisfy final judgments”. Specific provision is also made for including in the next tax levy payments of rebate amounts not otherwise provided for and payment of notes in anticipation of federal or state aid, if the aid is no longer forthcoming.

The total amount of a tax levy is limited by statute. However, the voters in each municipality may vote to exclude from the limitation any amounts required to pay debt service on indebtedness incurred before November 4, 1980. Local voters may also vote to exempt specific subsequent bond issues from the limitation. (See “Property Tax Limitations” under “PROPERTY TAXATION” below.) In addition, obligations incurred before November 4, 1980 may be constitutionally entitled to payment from taxes in excess of the statutory limit.

Except for taxes on the increased value of certain property in designated development districts which may be pledged for the payment of debt service on bonds issued to finance economic development projects within such districts, no provision is made for a lien on any portion of the tax levy to secure particular bonds or notes or bonds and notes generally (or judgments on bonds or notes) in priority to other claims. Provision is made, however, for borrowing to pay judgments, subject to the General Debt Limit. (See “INDEBTEDNESS - Debt Limit” below.) Subject to the approval of the State Director of Accounts for judgments above $10,000, judgments may also be paid from available funds without appropriation and included in the next tax levy unless other provision is made.

Court Proceedings. Massachusetts cities and towns are subject to suit on their general obligation bonds and notes and courts of competent jurisdiction have power in appropriate proceedings to order payment of a judgment on the bonds or notes from lawfully available funds or, if necessary, to order the city or town to take lawful action to obtain the required money, including the raising of it in the next annual tax levy, within the limits prescribed by law. (See “Property Tax Limitations” under “PROPERTY TAXATION” below.) In exercising their discretion as to whether to enter such an order, the courts could take into account all relevant factors including the current operating needs of the city or town and the availability and adequacy of other remedies. The Massachusetts Supreme Judicial Court has stated in the past that a judgment against a municipality can be enforced by the taking and sale of the property of any inhabitant. However, there has been no judicial determination as to whether this remedy is constitutional under current due process and equal protection standards.

Restricted Funds. Massachusetts statutes also provide that certain water, gas and electric, community antenna television system, telecommunications, sewer, parking meter and passenger ferry fee, community preservation and affordable housing receipts may be used only for water, gas and electric, community antenna television system, telecommunications, sewer, parking, mitigation of ferry service impacts, community preservation and affordable housing

7

purposes, respectively; accordingly, moneys derived from these sources may be unavailable to pay general obligation bonds and notes issued for other purposes. A city or town that accepts certain other statutory provisions may establish an enterprise fund for a utility, health care, solid waste, recreational or transportation facility and for police or fire services; under those provisions any surplus in the fund is restricted to use for capital expenditures or reduction of user charges. In addition, subject to certain limits, a city or town may annually authorize the establishment of one or more revolving funds in connection with use of certain revenues for programs that produce those revenues; interest earned on a revolving fund is treated as general fund revenue. A city or town may also establish an energy revolving loan fund to provide loans to owners of privately-held property in the city or town for certain energy conservation and renewable energy projects, and may borrow to establish such a fund. The loan repayments and interest earned on the investment of amounts in the fund shall be credited to the fund. Also, the annual allowance for depreciation of a gas and electric plant or a community antenna television and telecommunications system is restricted to use for plant or system renewals and improvements, for nuclear decommissioning costs, and costs of contractual commitments, or, with the approval of the State Department of Telecommunications and Energy, to pay debt incurred for plant or system reconstruction or renewals. Revenue bonds and notes issued in anticipation of them may be secured by a prior lien on specific revenues. Receipts from industrial users in connection with industrial revenue financings are also not available for general municipal purposes.

State Distributions. State grants and distributions may in some circumstances be unavailable to pay general obligation bonds and notes of a city or town in that the State Treasurer is empowered to deduct from such grants and distributions the amount of any debt service paid on “qualified bonds” (See “Serial Bonds and Notes” under “INDEBTEDNESS-TYPES OF OBLIGATIONS” below) and any other sums due and payable by the city or town to the Commonwealth or certain other public entities, including any unpaid assessments for costs of any public transportation authority (such as the Massachusetts Bay Transportation Authority or a regional transit authority) of which it is a member, for costs of the Massachusetts Water Resources Authority if the city or town is within the territory served by the Authority, for any debt service due on obligations issued to the Massachusetts School Building Authority, or for charges necessary to meet obligations under the Commonwealth’s Water Pollution Abatement or Drinking Water Revolving Loan Programs, including such charges imposed by another local governmental unit that provides wastewater collection or treatment services or drinking water services to the city or town.

If a city or town is (or is likely to be) unable to pay principal or interest on its bonds or notes when due, it is required to notify the State Commissioner of Revenue. The Commissioner shall in turn, after verifying the inability, certify the inability to the State Treasurer. The State Treasurer shall pay the due or overdue amount to the paying agent for the bonds or notes, in trust, within three days after the certification or one business day prior to the due date (whichever is later). This payment is limited, however, to the estimated amount otherwise distributable by the Commonwealth to the city or town during the remainder of the fiscal year (after the deductions mentioned in the foregoing paragraph). If for any reason any portion of the certified sum has not been paid at the end of the fiscal year, the State Treasurer shall pay it as soon as practicable in the next fiscal year to the extent of the estimated distributions for that fiscal year. The sums so paid shall be charged (with interest and administrative costs) against the distributions to the city or town.

The foregoing does not constitute a pledge of the faith and credit of the Commonwealth. The Commonwealth has not agreed to maintain existing levels of state distributions, and the direction to use estimated distributions to pay debt service may be subject to repeal by future legislation. Moreover, adoption of the annual appropriation act has sometimes been delayed beyond the beginning of the fiscal year and estimated distributions which are subject to appropriation may be unavailable to pay local debt service until they are appropriated.

Bankruptcy. Enforcement of a claim for payment of principal or interest on general obligation bonds or notes would be subject to the applicable provisions of Federal bankruptcy laws and to the provisions of other statutes, if any, hereafter enacted by the Congress or the State legislature extending the time for payment or imposing other constraints upon enforcement insofar as the same may be constitutionally applied. Massachusetts municipalities are not generally authorized by the Massachusetts General Laws to file a petition for bankruptcy under Federal Bankruptcy laws. In cases involving significant financial difficulties faced by a single city, town or regional school district, the Commonwealth has enacted special legislation to permit the appointment of a fiscal overseer, finance control board or, in the most extreme cases, a state receiver. In a limited number of these situations, such special legislation has also authorized the filing of federal bankruptcy proceedings, with the prior approval of the Commonwealth. In each case where such authority was granted, it expired at the termination of the Commonwealth’s oversight of the financially distressed city, town or regional school district. To date, no such filings had been approved or made.

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Continuing Disclosure

In order to assist the Underwriters in complying with Rule 15c2-12(b)(5) promulgated by the Securities and Exchange Commission (the “Rule”), the Town will covenant for the benefit of owners of the Bonds to provide certain financial information and operating data relating to Town by not later than 270 days after the end of each fiscal year ending June 30 (the “Annual Report”), and to provide notices of the occurrence of certain enumerated events. The covenants will be contained in a Continuing Disclosure Certificate, the proposed form of which is provided in Appendix D. The Certificate will be executed by the signers of the Bonds, and incorporated by reference in the Bonds. The Town has never failed to comply in all material respects with any previous undertakings to provide annual reports or notices of significant events in accordance with the Rule. Procedures are currently in place to assure compliance in the future.

The Treasurer, or such official’s designee from time to time, shall be the contact person on behalf of the Town from whom the foregoing information, data and notices may be obtained. The name, address and telephone number of the initial contact person is: Craig Mayen, Treasurer, Town of Mashpee, 16 Great Neck Road, Town Hall, Mashpee, MA 02649; 508-539-1400.

Bank Eligibility

The Bonds will be designated as “qualified tax-exempt obligations” for purposes of Section 265(b)(3) of the Code.

Rating

Standard & Poor’s has assigned a AAA a rating with a stable outlook on the Bonds. Such rating reflects only the rating agency’s views and will be subject to revision or withdrawal, which could affect the market price of the Bonds.

Financial Advisor

The services performed by Eastern Bank, Boston, Massachusetts and its affiliates with respect to the issuance of the Bonds cause Eastern Bank to be considered to have a Financial Advisory relationship with the Town under Rule G-23 of the Municipal Securities Rulemaking Board. Opinion of Bond Counsel

The unqualified approving opinion as to the validity of the Bonds will be rendered by Edwards Wildman Palmer LLP of Boston, Massachusetts, Bond Counsel. The opinion will be dated as of the date of original delivery of the Bonds and will speak only as of such date. The proposed form of legal opinion is set forth in Appendix C hereto.

The scope of engagement of Bond Counsel does not extend to passing upon or assuming responsibility for the accuracy or adequacy of any statements made in this Official Statement other than matters expressly set forth as their opinion and they make no representation that they have independently verified the same.

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THE TOWN

Incorporated in 1870, Mashpee lies in Southwestern Barnstable County, approximately 70 miles from Boston, on CapeCod. The Town is bordered by the Towns of Falmouth, Sandwich and Barnstable to the west, north and east, respectively.Mashpee has a total land area of 23.86 square miles and an estimated population of 14,343.

Services

The Town provides general governmental services for the territory within its boundaries, including police and fireprotection, public education in grades kindergarten through twelve, streets, parks and recreation and a library. Water isprovided by the Mashpee Water District.

The principal services provided by Barnstable County are space for courts, a jail and house of correction, and registryof deeds. The Town’s high school accommodates pupils in grades seven through twelve. The Cape Cod RegionalVocational-Technical High School provides vocational-technical education in grades nine through twelve. The Cape CodRegional Transit Authority provides bus service to the Town.

The Mashpee Water District (the “District”) was established according to Chapter 136 of the Acts of 1987. TheDistrict was formed for the purpose of supplying the District residents with water for fire protection, domestic use and otherpurposes. The first year of operation began in fiscal year 1989. The District is empowered to levy property taxes upon alltaxable property located within the District (which is coterminous with the Town), such amount being subject to thelimitations imposed by Chapter 59, Section 21C of the Massachusetts General Laws with respect to the total amount oftaxes which may be levied upon all taxable property in the Town to pay debt service and operating expenses.

Principal Facilities

The following is a list of the Town’s principal facilities, date built or remodeled, and the most recent assessedvaluation.

Assessed

Facility Date Built (Remodeled) Valuation

High School 1996 $ 33,310,000

Kenneth C. Coombs School 1989 6,098,400

Quashnet School 1978 (1990)(1993) 12,894,000

Police Station 1979 (1990) 6,788,200

Town Hall (Former Elementary School) 1932 (1960) (1997) 2,874,700

Fire Station 2001 2,439,400

Fire Station (2nd) 2008 2,023,400

Transfer Station 1990 2,370,600

Public Works Department 1985 1,277,900

Library 1987 5,438,700

Senior Center 1976 (1992) 1,340,100

Town Archives (Former Town Library) 1965 235,600

Thrift Shop - Senior Center 2005 75,200

Kids Club Child Care Center 1992 633,600

Thrift Shop 1994 42,600

Governing Bodies and Officers

Local legislative decisions are made by an open town meeting consisting of all the registered voters in the Town.Subject to the legislative decisions made by the town meeting, the affairs of the Town are generally administered by aboard of five selectmen who appoint a Town Manager.

Local school affairs are administered by a school committee of five persons while local taxes are assessed by aboard of three assessors all elected for staggered three-year terms on an at-large basis.

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Principal Executive Officers

The following is a list of the principal executive officers in the Town.

Manner of Length Expiration

Union Department Selection of Term of Term

Chrm Board of Selectmen John J. Cahalane Elected 3 Years 2014

Vice-Chair of Selectmen Michael R. Richardson Elected 3 Years 2015

Selectman, Clerk Thomas O'Hara Elected 3 Years 2014

Selectman Wayne E. Taylor Elected 3 Years 2015

Selectman Carol Sherman Elected 3 Years 2016

Town Manager Joyce Mason Appointed 3 Years 2016

Town Accountant Dawn Thayer Appointed 3 Years NA

Treasurer Craig Mayen Appointed 3 Years NA

Collector Craig Mayen Appointed 3 Years NA

Town Clerk Deborah F. Dami Elected 3 Years 2014

Superintendent of Schools Brian Hyde Appointed 3 Years 2015

Town Counsel Louison, Costello, Condon and Pfaff, LLC Appointed NA NA

Collective Bargaining

Employees of Massachusetts municipalities have certain organizational and representational rights which include theright to organize, to bargain collectively by representatives of their choice on questions of wages, hours and other terms andconditions of employment, and to engage in lawful concerted activities for bargaining or other mutual aid or protection.Under Massachusetts law, strikes by municipal employees are prohibited. The Town has approximately 667 full and part-time employees of whom approximately 54% percent belong to unions or other collective bargaining groups. Thefollowing table sets forth the collective bargaining groups.

Contract

Union Department Members Expires (1)

Mashpee Public Employees Local Union Administrators International Union 19 6/30/2014

Service Employees International Local 254 AFL-CIO Clerical Unit 24 6/30/2014

Service Employees International Local 254 AFL-CIO DPW Unit 19 6/30/2014

International Brotherhood of Police Officers-A Police Officers 24 6/30/2014

International Brotherhood of Police Officers-B Police Sergeant 6 6/30/2014

Mashpee Permanent Firefighters Association Fire 31 6/30/2012

Massachusetts Teachers Association School 163 6/30/2013

Paraprofessionals & Clerical School 59 6/30/2016

Service Employees International Local 254 AFL-CIO School Custodians & Maintenance 16 6/30/2016

Total: 361

_________________________

(1) Expired contracts are currently in negotiations.

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Other Data

The following tables set forth population trends, age characteristics, housing characteristics, income levels andemployment figures for the Town, Barnstable County, and The Commonwealth of Massachusetts.

PopulationMashpee Barnstable County Massachusetts

Year Number % Change Number % Change Number % Change

2012 estimate 14,005 0.0% 215,423 -0.2% 6,646,144 1.5%

2010 14,006 8.2 215,888 -2.9 6,547,629 3.1

2000 12,946 64.2 222,230 19.1 6,349,097 5.5

1990 7,884 113.1 186,605 26.1 6,016,425 4.9

1980 3,700 147,925 5,737,037

_________________________

Source: U.S. Department of Commerce for actuals and estimates,

Massachusetts Institute for Social & Economic Research for projections.

Median Age

Mashpee Barnstable County Massachusetts

Age Number Percent Number Percent Number Percent

Under 5 Years 757 5.4% 8,996 4.2% 366,952 5.6%

5 Years to 19 Years 2,311 16.6 32,933 15.2 1,257,302 19.2

20 Years to 64 Years 7,662 54.9 119,799 55.5 4,025,262 61.4

65 Years and Over 3,220 23.1 54,293 25.1 911,079 13.9

Total 13,950 100.0% 216,021 100.0% 6,560,595 100.0%

Median Age 47 50 39

Median Age (2000) 40.6 44.6 36.5

_________________________

Source: U.S. Department of Commerce

Median Value Owner-Occupied Housing Units

Mashpee Barnstable County Massachusetts

Units Number Percent Number Percent Number Percent

Less than $100,000 290 6.0% 1,886 2.5% 55,908 3.5%

100,000 - 199,999 384 7.9 3,877 5.1 201,702 12.6

200,000 - 299,999 1,257 25.8 16,930 22.2 402,530 25.2

300,000 - 499,999 2,080 42.7 32,161 42.1 603,907 37.8

500,000 - 999,999 613 12.6 16,722 21.9 276,805 17.3

1,000,000 or more 247 5.1 4,731 6.2 55,107 3.5

Total 4,871 100.0% 76,307 100.0% 1,595,959 100.0%

Median Value $337,300 $373,600 $335,500

_________________________

Source: U.S. Department of Commerce

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Age of Housing UnitsMashpee Barnstable County Massachusetts

Year Built Number Percent Number Percent Number Percent

2000 or later 1,348 14.2% 11,323 7.1% 187,003 6.7%

1980 to 1999 5,043 53.1 49,752 31.2 508,434 18.2

1940 to 1979 2,849 30.0 78,118 48.9 1,111,838 39.7

1939 or Earlier 253 2.7 20,498 12.8 992,082 35.4

Total 9,493 100.0% 159,691 100.0% 2,799,357 100.0%

_________________________

Source: U.S. Department of Commerce

Per Capita IncomeMashpee Barnstable County Massachusetts

Year Amount % Change Amount % Change Amount % Change

2012 5-year estimates $33,392 32.4% $36,060 42.4% $35,485 36.7%

1999 25,215 73.6 25,318 54.4 25,952 50.7

1989 14,526 85.9 16,402 120.8 17,224 131.0

1979 7,813 0.0 7,428 0.0 7,457 0.0

% Below Poverty Level (2012 5-yearestimates) 9.2% 9% 11%

_________________________

Source: U.S. Department of Commerce

Family IncomeMashpee Barnstable County Massachusetts

Income for Families Families Percent Families Percent Families Percent

Less than $10,000 138 3.4% 1,554 2.6% 57,204 3.6%

10,000 - 24,999 336 8.4 4,345 7.3 132,790 8.3

25,000 - 49,999 778 19.4 11,419 19.1 260,930 16.3

50,000 - 74,999 729 18.2 11,610 19.4 257,973 16.1

75,000 - 99,999 695 17.3 10,026 16.8 235,746 14.7

100,000 - 149,999 690 17.2 12,033 20.1 331,738 20.7

150,000 or more 648 16.1 8,757 14.7 327,825 20.4

Total 4,014 100.0% 59,744 100.0% 1,604,206 100.0%

Median Income $75,631 $77,318 $84,380

_________________________

Source: U.S. Department of Commerce

Household IncomeMashpee Barnstable County Massachusetts

Income for Households Households Percent Households Percent Households Percent

Less than $10,000 247 4.3% 4,901 5.1% 159,535 6.3%

10,000 - 24,999 762 13.3 13,109 13.7 345,816 13.7

25,000 - 49,999 1,387 24.2 21,843 22.9 472,301 18.7

50,000 - 74,999 936 16.3 17,746 18.6 412,921 16.3

75,000 - 99,999 853 14.9 13,200 13.8 329,572 13.0

100,000 - 149,999 835 14.6 14,173 14.8 422,194 16.7

150,000 or more 717 12.5 10,548 11.0 383,355 15.2

Total 5,737 100.0% 95,520 100.0% 2,525,694 100.0%

Median Income $62,547 $60,424 $66,658

_________________________

Source: U.S. Department of Commerce

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Unemployment

Unemployment Rate

Calendar Year (1) Labor Force Employment Town County State US

2013 (October) 8,135 7,574 6.9% 6.5% 6.8% 7.0%

2012 8,153 7,595 6.8 7.4 6.7 8.1

2011 8,080 7,476 7.5 8.2 6.8 8.9

2010 8,282 7,566 8.6 9.2 8.5 9.6

2009 8,227 7,575 7.9 8.5 8.2 9.3

_________________________

Source: Massachusetts Department of Employment & Training

(1) Full year averages except for 2013 which is for the month indicated.

Employment and Payrolls

Calendar Year Average

Employment by Industry 2012 2011 2010 2009 2008

Construction & Natural Resources 420 385 395 414 468

Manufacturing 62 56 61 86 70

Trade, Transportation & Utilities 1,243 1,262 1,180 1,126 1,131

Financial Activities 142 138 153 163 170

Professional & Business Services 421 405 377 419 397

Education & Health Services 738 700 726 734 611

Leisure & Hospitality 801 815 783 779 761

Information & Other Services 332 341 349 345 329

Public Administration -0- -0- -0- -0- 179

Total Employment 4,632 4,568 4,498 4,563 4,534

Number of Establishments 472 474 477 457 457

Total Annual Wage (000) $158,585 $150,276 $144,773 $154,699 $149,772

Average Weekly Wage 658 633 619 652 635

_________________________

Source: Massachusetts Department of Employment & Training

Building Permits

Below is a list of the building permits issued and their estimated values for the following calendar years.

For Calendar Year

2013(1) 2012 2011 2010 2009

Residential and Non-Residential:

Number…………………… 253 258 203 208 191

Value……………………… $31,685,404 $45,111,280 $27,400,656 $22,530,812 $18,509,716

_________________________

(1) Building permits for 2013 are as of December 1, 2013.

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Principal Employers

The Town is the largest employer with approximately 667 employees. The other principal employers are set forthbelow.

Current

Company Nature of Business Employees

Super Stop & Shop Supermarket 175

New Seabury Limited Partnership Real Estate, Resort, Country Club 120

Center for Optimum Care Nursing Home 113

Botello Home Center Building Supplies 78

Willowbend Country Club, Real Estate 75

99 Restaurant Restaurant 71

Star Market Supermarket 63

Bobby Byrnes' Pub Restaurant 50

The Gap Retail 30

CVS Retail 30

Public School Facilities

The Town provides public school facilities for pupils in grades kindergarten through two at the Kenneth CoombsElementary School and for pupils in grades three through six at the Quashnet School. Grades seven through twelve attendMashpee High School. Vocational-technical education for students in grades nine through twelve is provided by the CapeCod Regional Vocational-Technical School District, of which the Town is a member. The following tables list the publicschool facilities, current and projected enrollment figures, and student-teacher ratios for the Town.

Date Added to Current

Name Grade Built (Remodeled) Capacity Enrollment

Kenneth Coombs PreK-2 1989 - 600 431

Quashnet School 3-6 1978 1990, 1993 1,000 557

Mashpee High School 7-12 1996 - 1,180 710

Cape Cod RVTSD 9-12 1975 - 650 655(1)

Totals: 3,430 2,353

_________________________

(1) Of the students enrolled, 57 students are from Mashpee.

Public School Enrollments

Actual(1) Projected

2006-07 2007-8 2008-9 2009-10 2010-11 2011-12 2012-13 2013-14

Elementary 1,083 1,067 999 1,042 1,039 1,029 1,004 988

High School 993 988 819 814 728 708 702 710

Cape Cod RVTSD (2) 43 43 43 56 54 54 54 57

Totals: 2,119 2,098 1,861 1,912 1,821 1,791 1,760 1,755

___________________________

(1) Source: Massachusetts Department of Education - As of October 1, each school year.

(2) Mashpee students only.

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INDEBTEDNESS

Debt Limits

The general debt limit of the Town consists of a normal debt limit and a double debt limit. The normal debt limit is 5.0percent of the valuation of taxable property as last equalized by the State Department of Revenue. The Town can authorizeup to $241,744,805 without state approval and up to twice this amount ($483,489,610 – double debt limit) with theapproval of the Municipal Finance Oversight Board composed of the State Treasurer, the State Auditor, the AttorneyGeneral and the Director of Accounts.

There are many categories of general obligation debt which are exempt from and do not count against the GeneralDebt Limit. Among others, these exempt categories include revenue anticipation notes and grant anticipation notes;emergency loans; loans exempted by special laws; certain school bonds, sewer bonds, solid waste disposal facility bondsand economic development bonds supported by tax increment financing; and subject to special debt limits, bonds for water(limited to 10 percent of equalized valuation), housing, urban renewal and economic development (subject to various debtlimits), and electric, gas, community antenna television systems, and telecommunications systems (subject to separatelimits). Revenue bonds are not subject to these debt limits. The General Debt Limit and the special debt limit for waterbonds apply at the time the debt is authorized. The other special debt limits generally apply at the time the debt is incurred.

Types of Obligations

As of January 1, 2014, the Town of Mashpee had total outstanding and authorized unissued general obligation debt of$26,514,867 of which $4,853,095 was outside the debt limit, and $21,661,772 was subject to its general debt limit. Theadditional debt which could be authorized within the normal 5.0 percent debt limit was $220,083,033. The additional debtwhich could be authorized within the double debt limit was $461,827,838.

Serial bonds and notes are authorized by vote of two-thirds of the town meeting. Refunding bonds and notes areauthorized by the selectmen. When serial bonds or notes have been authorized, bond anticipation notes may be issued bythe officers authorized to issue the serial bonds or notes. Temporary debt in anticipation of the revenue of the fiscal year inwhich the debt is incurred or in anticipation of authorized federal and state aid generally may be incurred by the treasurerwith the approval of the selectmen.

General Obligations. Massachusetts cities and towns are authorized to issue general obligation indebtedness of thesetypes:

Serial Bonds and Notes These are generally required to be payable in equal or diminishing annual principal amountsbeginning no later than the end of the next fiscal year commencing after the date of issue and ending within the termspermitted by law. A level debt service schedule or a schedule that provides for a more rapid amortization of principal thanlevel debt service is permitted. The principal amounts of certain economic development bonds supported by tax incrementfinancing may be payable in equal, diminishing or increasing amounts beginning within 5 years after the date of issue. Themaximum terms of serial bonds and notes vary from one year to 40 years, depending on the purpose of the issue. Themaximum terms permitted are set forth in the statutes. In addition, for many projects, the maximum term may bedetermined in accordance with useful life guidelines promulgated by the State Department of Revenue (“DOR”). Serialbonds and notes may be issued for the purposes set forth in the statutes. In addition, serial bonds and notes may be issuedfor any other public work improvement or asset not specifically listed in the Statutes that has a useful life of at least 5 years.

Bonds or notes may be made callable and redeemed prior to their maturity, and a redemption premium may be paid.Refunding bonds or notes may be issued subject to the maximum applicable term measured from the date of the originalbonds or notes and must produce present value savings over the debt service of the refunded bonds. Generally, the firstprincipal payment of the refunding bonds cannot be later than the first principal payment of any of the bonds or notes beingrefunded thereby, however, principal payments made before the first principal payment of any bonds or notes beingrefunded thereby may be in any amount.

Serial bonds may be issued as “qualified bonds” with the approval of the state Municipal Finance Oversight Boardcomposed of the State Treasurer, the State Auditor, the Attorney General and the Director of Accounts, subject to suchconditions and limitations (including restrictions on future indebtedness) as may be required by the Board. Qualified bondsmay mature not less than 10 nor more than 30 years from their dates and are not subject to the amortization requirements

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described above. The State Treasurer is required to pay the debt service on qualified bonds and thereafter to withhold theamount of the debt service paid by the State from state aid or other state payments; administrative costs and any loss ofinterest income to the State are to be assessed upon the city or town.

Tax Credit Bonds or Notes Subject to certain provisions and conditions, the officers authorized to issue bonds or notesmay designate any duly authorized issue of bonds or notes as “tax credit bonds” to the extent such bonds and notes areotherwise permitted to be issued with federal tax credits or other similar subsidies for all or a portion of the borrowing costs.Tax credit bonds may be made payable without regard to the annual installments required by any other law, and a sinkingfund may be established for the payment of such bonds. Any investment that is part of such a sinking fund may mature notlater than the date fixed for payment or redemption of the applicable bonds.

Bond Anticipation Notes These generally must mature within two years of their original dates of issuance but may berefunded from time to time for a period not to exceed five years from their original dates of issuance, provided that for eachyear that the notes are refunded beyond the second year they must be paid in part from revenue funds in an amount at leastequal to the minimum annual payment that would have been required if the bonds had been issued at the end of the secondyear. For certain school projects, however, notes may be refunded from time to time for a period not to exceed seven yearswithout having to pay any portion of the principal of the notes from revenue funds. The maximum term of bonds issued torefund bond anticipation notes is measured (except for certain school projects) from the date of the original issue of thenotes.

Revenue Anticipation Notes These are issued to meet current expenses in anticipation of taxes and other revenues.They must mature within one year but, if payable in less than one year, may be refunded from time to time up to one yearfrom the original date of issue.

Grant Anticipation Notes These are issued for temporary financing in anticipation of federal grants and state andcounty reimbursements. Generally, they must mature within two years but may be refunded from time to time as long asthe municipality remains entitled to the grant or reimbursement.

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Debt Summary

Authorized Outstanding Authorized

Unissued Bonds Unissued

Outstanding Bonds After This Bonds After

Long-Term Indebtedness (1)(2)(3) 1/01/2014 1/01/2014 Issue This Issue

Within the General Debt Limit:

Sewers & Drains ……………………… $ 152,586 $ 275,000 $ 152,586 $ 275,000(4)

Land Acquisition ……………………… 8,202,761 3,308,186 10,933,761 577,186(5)

Schools ………………………………… 116,239 -0- 116,239 -0-

Other Building ………………………… 7,016,900 1,446,000 8,462,900 -0-

Streets Sidewalks & Parking ………….. 484,300 -0- 484,300 -0-

Departmental Equipment …………….. 100,000 500,000 595,000 5,000(6)

Architectural & Engineering Services … 9,800 -0- 9,800 -0-

Other Inside General ………………….. -0- 50,000 -0- 50,000(4)

Total Within the General Debt Limit …… $ 16,082,586 $ 5,579,186 $ 20,754,586 $ 907,186

Outside the General Debt Limit:

Schools ……………………………….. $ 4,260,000 $ -0- $ 4,260,000 $ -0-

Other Outside General ……………….. 593,095 -0- 593,095 -0-

Total Outside the General Debt Limit ….. $ 4,853,095 $ -0- $ 4,853,095 $ -0-

Total Long-Term Indebtedness …………. $ 20,935,681 $ 5,579,186 $ 25,607,681 $ 907,186

Outstanding

Outstanding After This

Short-Term Indebtedness 1/01/2014 Issue

Revenue Anticipation Notes ………….. $ -0- $ -0-

Grant Anticipation Notes …………….. -0- -0-

Bond Anticipation Notes ……………… 5,193,660(7) -0-

Total Short-Term Indebtedness …………. $ 5,193,660 $ -0-

_________________________

(1) Principal amount only. Excludes lease and installment purchase obligations, overlapping debt and unfunded pension liability.(2) At the present time the normal General Debt Limit is $241,744,805 and the Double General Debt Limit is $483,489,610.(3) $13,409,934 has been exempted from the provisions of Proposition 2 1/2.

(4) This is not expected to be issued at this time.

(5) Of this amount, $516,660 will be paid from unused bond anticipation note proceeds and $60,526 will be rescinded.

(6) This amount will be paid from unused bond anticipation note proceeds.(7) These notes will be paid from bond proceeds and unused note proceeds.

Bonded Debt vs. Population, Valuations and IncomeAs of June 30

2013 2012 2011 2010 2009

Amount (1) ……………………………… $ 24,125,203 $ 27,646,566 $ 31,417,433 $ 28,726,554 $ 32,106,950

Per Capita (2) ……………………………. 1,722.61 1,974.05 2,244.42 2,051.02 2,234.77

Percent of Assessed Valuation (3) ………. 0.55% 0.62% 0.71% 0.61% 0.64%

Percent of Equalized Valuation (4) ……… 0.50 0.53 0.60 0.51 0.58

Per Capita as a percent of

Personal Income (2) per capita ………… 5.16 5.91 6.72 6.14 6.69

_________________________

(1) Principal amount only. Excludes lease and installment purchase obligations, overlapping debt and unfunded pension liability.

(2) Source: U.S. Department of Commerce, Bureau of the Census - Latest applicable actuals or estimates.

(3) Source: Board of Assessors - Assessed valuation as of the prior January 1.

(4) Source: Massachusetts Department of Revenue - Equalized valuation in effect for that fiscal year

(equalized valuations are established for January 1 of each even-numbered year).

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Five Years Outstanding Debt

As of June 30

Long-Term Indebtedness(1) 2013 2012 2011 2010 2009

Within the General Debt Limit:

Sewers & Drains ……………………… $ 172,449 $ 193,753 $ 303,861 $ 124,723 $ 135,768

Land Acquisition ……………………… 9,192,915 10,198,093 11,222,904 11,654,572 12,653,440

Schools ……………………………….. 174,085 229,907 285,096 341,428 397,560

Other Building ………………………… 7,383,550 8,106,802 8,834,153 4,359,554 4,809,956

Streets Sidewalks & Parking ………….. 669,650 895,350 1,121,400 972,450 1,168,500

Departmental Equipment …………….. 150,000 200,000 250,000 300,000 350,000

Architectural & Engineering Services … 14,800 19,848 24,947 30,096 80,244

Total Within the General Debt Limit …… $ 17,757,449 $ 19,843,753 $ 22,042,361 $ 17,782,823 $ 19,595,468

Outside the General Debt Limit:

Schools ……………………………….. 5,690,000 7,065,000 8,554,500 10,041,900 11,530,300

Other Outside General ……………….. 677,754 737,813 820,572 901,831 981,182

Total Outside the General Debt Limit ….. $ 6,367,754 $ 7,802,813 $ 9,375,072 $ 10,943,731 $ 12,511,482

Total Long-Term Indebtedness ……….. $ 24,125,203 $ 27,646,566 $ 31,417,433 $ 28,726,554 $ 32,106,950

Short-Term Indebtedness

Revenue Anticipation Notes ………….. $ -0- $ -0- $ -0- $ -0- $ -0-

Grant Anticipation Notes …………….. -0- -0- -0- -0- -0-

Bond Anticipation Notes ……………… 5,303,660 2,209,859 2,044,524 5,877,500 4,032,500

Total Short-Term Indebtedness ……….. $ 5,303,660 $ 2,209,859 $ 2,044,524 $ 5,877,500 $ 4,032,500

Total Outstanding Indebtedness ……..… $ 29,428,863 $ 29,856,425 $ 33,461,957 $ 34,604,054 $ 36,139,450

_________________________

(1) Principal amount only. Excludes lease and installment purchase obligations, overlapping debt and unfunded pension liability.

Revenue Anticipation Borrowing

Revenue anticipation notes are issued to meet current expenses in anticipation of taxes and other revenues. Theamount borrowed in each fiscal year by the issue of revenue anticipation notes is limited to the tax levy of the prior fiscalyear, together with the net receipts in the prior fiscal year from the motor vehicle excise and certain payments made by theCommonwealth in lieu of taxes. The fiscal year ends on June 30. Notes may mature in the following fiscal year, and notesmay be refunded into the following fiscal year to the extent of the uncollected, unabated current tax levy and certain otheritems, including revenue deficits, overlay deficits, final judgments and lawful unappropriated expenditures, which are to beadded to the next tax levy, but excluding deficits arising from a failure to collect taxes of earlier years. (See “Taxation toMeet Deficits” under “Property Tax” below.) In any event, the period from an original borrowing to its final maturitycannot exceed one year. The Town has not borrowed in anticipation of revenue in the past ten fiscal years.

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Principal Repayment Schedule

Less

State School Less Cumulative

Fiscal Outstanding - 1/15/14 (1) (2) Principal Interest Construction MWPAT Total Debt Principal

Year Principal Interest This Issue This Issue (3) Aid Subsidies Service % Retired

2014 $ 356,427 $ 386,940 $ - $ - $ - $ - $ 743,367 1.4

2015 3,537,793 724,803 452,000 175,200 (944,439) (34,788) 3,910,569 7.07

2016 3,349,417 594,952 420,000 158,250 (944,439) (35,950) 3,542,230 31.7

2017 2,761,004 483,408 420,000 142,500 (944,439) (29,795) 2,832,678 44.1

2018 1,362,590 410,227 420,000 126,750 (26,756) 2,292,811 51.0

2019 1,349,277 356,708 405,000 111,000 (24,048) 2,197,937 57.9

2020 1,220,763 307,175 295,000 95,813 (6,076) 1,912,675 63.8

2021 1,175,550 261,288 295,000 84,750 (3,196) 1,813,392 69.6

2022 1,118,796 217,579 290,000 73,688 (1,761) 1,698,302 75.1

2023 938,796 177,002 290,000 62,813 (1,246) 1,467,365 79.9

2024 923,384 139,335 285,000 51,938 (741) 1,398,916 84.6

2025 838,384 103,497 280,000 41,250 (247) 1,262,884 89.0

2026 793,500 72,238 275,000 30,750 1,171,488 93.1

2027 520,000 45,013 240,000 20,438 825,451 96.1

2028 400,000 25,675 210,000 11,438 647,113 98.5

2029 290,000 11,600 95,000 3,563 400,163 100.0

-

Total $20,935,681 $ 4,317,440 $ 4,672,000 $ 1,190,141 $(2,833,317) $ (164,604) $28,117,341

_________________________

(1) Excludes short-term debt, lease and installment purchase obligations, overlapping debt and unfunded pension liability.(2) Principal totaling $13,409,934 and interest totaling $2,865,501 has been exempted from the provisions of Proposition 2 1/2.(3) Interest estimated at 3.75%.

Overlapping Debt

In addition to direct debt, the Town is indirectly liable for a portion of the debt and other expenses incurred by variousoverlapping governmental authorities and agencies.

Counties. County expenses including debt service on county bonds are assessed upon the cities and towns within thecounty in proportion to their taxable valuation as last equalized by the State Commissioner of Revenue. (The expenses ofSuffolk County are borne by the City of Boston alone.) Legislation was enacted in 1997 abolishing the county governmentsof Franklin and Middlesex counties as of July 1, 1997, with their assets, functions, debts and other obligations beingassumed by the Commonwealth. The abolishment of the Middlesex county government was in part in response to defaultby the county in the payment of general obligation notes of the county. The legislation also abolished the countygovernments of Hampden and Worcester counties as of July 1, 1998. Legislation enacted in 1998 abolishes the countygovernments of Hampshire, Essex and Berkshire counties as of January 1, 1999, July 1, 1999 and July 1, 2000,respectively. The legislation also requires the state secretary for administration and finance to establish a plan to recover theCommonwealth’s expenditures for the liabilities and other debts assumed and paid by the Commonwealth on behalf of anabolished county. Unless these provisions are changed by further legislation, the state treasurer shall assess upon each cityand town within the jurisdiction of an abolished county an amount not to exceed or equal to the county tax paid by eachsuch city and town for the fiscal year immediately prior to the abolishment of the county until such expenditures by theCommonwealth are recovered. It is possible that similar legislation will be sought to provide for the abolishment of countygovernment in all the remaining counties.

Regional School Districts. Towns may organize regional school districts to carry out general or specialized educationalfunctions. Pursuant to special laws a number of cities may also participate in regional school districts, primarily forvocational education. The operating expenses and debt service of regional school districts are apportioned among themember municipalities in accordance with the agreements establishing the districts subject to the provisions of theEducation Reform Act of 1993. The Town is a member of the Cape Cod Regional Technical School District. The other

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member towns in the District are Barnstable, Brewster, Chatham, Dennis, Eastham, Harwich, Orleans, Provincetown,Truro, Wellfleet and Yarmouth.

Regional Transit Authorities. These are transportation authorities which have been established outside the Bostonarea. It has been state practice in recent years to provide a portion of their net cost of service, including debt service on theirbonds. In addition to the other sources of funds provided by Massachusetts General Laws 161B for which the regionaltransit authorities may obtain monies for the payment of the principal of and interest on their obligations, such payment willbe further secured by the Commonwealth, which is required to pay to the regional transit authorities amounts duly certifiedby the administrator of the authority as necessary to pay any principal or interest due or about to come due for such purpose.The remainder of the net cost of service is assessed upon member cities and towns in proportion to the amount of the netcost incurred on routes within each city or town. The aggregate amount of such assessments is generally not permitted toincrease by more than 2.5 percent per year. (See “Tax Limitation” under PROPERTY TAXATION” below.)

Other Regional Districts. Regional districts that include cities and towns, or parts thereof, may be organized under theGeneral Laws for certain other purposes, including water pollution abatement and solid waste disposal. Regional districtshave also been established under special laws for sewer and water purposes. The apportionment of operating expenses anddebt service of such districts is sometimes prescribed specifically by the laws under which they are organized; for othersuch districts the apportionment is determined in accordance with the agreements establishing the districts. The MashpeeWater District provides water services to substantially all the territory located within the Town. The outstanding debt ofthe District as of January 1, 2014 is $3,510,000.

In addition to direct debt, the Town is indirectly liable for a portion of the debt and other expenses incurred by variousoverlapping governmental authorities and agencies (1). The following table sets forth the outstanding and authorized butunissued bonded debt of each authority or agency, Mashpee’s percentage of this outstanding debt and the Town’s fiscalyear dollar assessment.

Estimated

Outstanding Share % FY 2014

6/30/13 Mashpee Assessment

Barnstable County (2)……………………..………………. $17,471,578(2) (2) $360,077

Cape Cod Regional Vocational-Technical School District (3) -0- 6.80% 969,173

Cape Cod Regional Transit Authority (4)………………….. -0- NA 59,091_______________________

(1) Excludes temporary loans in anticipation of revenue. Omits debt of the Commonwealth.(2) Source: Barnstable County. Debt is as of June 30, 2013. The outstanding debt consists of septic system betterment borrowings

through the Massachusetts Water Pollution Abatement Trust.(3) Source: Cape Cod Regional Vocational-Technical School Regional School District. Debt is as of June 30, 2013. The operating

expenses and debt service of the school district are apportioned among the member municipalities. The shares of the membermunicipalities vary from year to year according to pupil enrollment.

(4) Source: Cape Cod Regional Transit Authority.

Authorized Unissued Debt and Prospective Financing

The Town has $5,579,186 authorized but unissued debt. Of this amount, $1,446,000 pertains to remodelingprojects to various town buildings; $500,000 pertains to departmental equipment, $3,308,186 pertains to various roadtaking projects and $325,000 pertain to balances of other capital projects. The Town has issued bond anticipation notesto finance these projects in the amount of $5,193,660 that mature on January 31, 2014. Of this amount, $4,672,000 willbe retired with bond proceeds and $521,660 from unused note proceeds. Various balances in the amount of $60,526 forroad taking projects will be rescinded and $325,000 for sewers and other capital projects are not expected to be issuedat this time.

PROPERTY TAXATION

The principal revenue source of the Town is the tax on real and personal property. The amount to be levied in eachyear is the amount appropriated or required by law to be raised for municipal expenditures less estimated receipts fromother sources and less appropriations voted from available funds. The total amount levied is subject to certain limitsprescribed by law; for a description of those limits, see “Tax Limitations.” As to the inclusion of debt service and final

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judgments, see “Security and Remedies.” The estimated receipts for a fiscal year from other sources may not exceedthe actual receipts during the preceding fiscal year from the same sources unless approved by the State Commissionerof Revenue. Excepting special funds, the use of which is otherwise provided for by law, the deducting forappropriations voted from available funds for a fiscal year cannot exceed the “free cash” as of the beginning of theprior fiscal year as certified by the State Director of Accounts plus up to nine months’ collections and receipts onaccount of earlier years’ taxes after the date. Subject to certain adjustments, free cash is surplus revenue lessuncollected overdue property taxes from earlier years. Although an allowance is made in the tax levy for abatements(see “Abatements and Overlay”) no reserve is generally provided for uncollectible real property taxes. Since some ofthe levy is inevitably not collected, this creates a cash deficiency which may or may not be offset by other items (see“Taxation to Meet Deficits”).

Tax Levy Computation

The following table reflects the calculation of tax levies for the following fiscal years.

For Fiscal Year

2014 2013 2012 2011 2010

Gross Amount to be Raised:

Appropriations ……………….. $ 57,478,148 $ 53,581,576 $ 52,385,588 $ 50,101,575 $ 51,018,805

Other Local Expenditures …….. 309,996 178,543 33,910 27,765 18,903

State & County Charges ……… 1,740,746 1,465,759 1,323,403 1,062,416 940,691

Overlay Reserve ………………. 368,413 388,406 337,933 429,929 390,316

Total Gross Amount to be Raised 59,897,303 55,614,285 54,080,834 51,621,685 52,368,715

Less Estimated Receipts & Other Revenue:

Estimated Receipts from State… 6,634,947 6,468,558 6,257,326 6,176,478 6,680,816

Estimated Receipts - Local …… 7,822,336 5,580,350 6,636,933 5,156,764 5,553,108

Available Funds Appropriated:

Free Cash ……………………. 2,318,588 2,360,266 1,974,421 1,602,744 2,276,833

Revenue Sharing …………….. -0- -0- -0- -0- -0-

Other Available Funds ………. 2,638,298 1,287,600 1,338,916 1,400,100 1,426,455

Free Cash & Other Revenue Used

to Reduce the Tax Rate ……… -0- -0- -0- -0- -0-

Total Estimated Receipts & Revenue 19,414,169 15,696,774 16,207,596 14,336,086 15,937,212

Net Amount to be Raised (Tax Levy) $ 40,483,134 $ 39,917,510 $ 37,873,238 $ 37,285,599 $ 36,431,503

Property Valuation …………….. $ 4,400,340,630 $ 4,391,365,280 $ 4,450,439,240 $ 4,454,671,310 $ 4,676,701,290

_________________________

Source: Massachusetts Department of Revenue.

Taxation to Meet Deficits

Overlay deficits, i.e., tax abatements in excess of the overlay included in the tax levy to cover abatements, are requiredto be added to the next tax levy. It is generally understood that revenue deficits, i.e., those resulting from non-property taxrevenues being less than anticipated, are also required to be added to the next tax levy (at least to the extent not covered bysurplus revenue). Amounts lawfully expended since the prior tax levy and not included therein are also required to beincluded in the annual tax levy. The circumstances under which this can arise are limited since municipal departments aregenerally prohibited from incurring liabilities in excess of appropriations except for major disasters, mandated items,contracts in aid of housing and renewal projects and other long-term contracts. In addition, established utility rates andcertain established salaries, e.g., civil service, must legally be paid, for work actually performed, whether or not covered byappropriations.

In the opinion of Bond Counsel, cities and towns are authorized to appropriate sums, and thus to levy taxes to coverdeficits arising from other causes, such as “free cash” deficits arising from a failure to collect taxes. This is not generallyunderstood, however, and it has not been the practice to levy taxes to cover free cash deficits. Except to the extent that suchdeficits have been reduced or eliminated by subsequent collections of uncollected taxes (including sales of tax titles and tax

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possessions), lapsed appropriations, non-property tax revenues in excess of estimates, other miscellaneous items or fundingloans authorized by special act, they remain in existence.

Property Tax Limitation

Chapter 59, Section 21C of the Massachusetts General Laws, also known as Proposition 2 ½, imposes two separatelimits on the annual tax levy of a city or town.

The primary limitation is that the tax levy cannot exceed 2½ percent of the full and fair cash value. If a city or townexceeds the primary limitation, it must reduce its tax levy by at least 15 percent annually until it is in compliance, providedthat the reduction can be reduced in any year to not less than 7½ percent by majority vote of the voters, or to less than 7½percent by two-thirds vote of the voters.

For cities and towns at or below the primary limit, a secondary limitation is that the tax levy cannot exceed themaximum levy limit for the preceding fiscal year as determined by the State Commissioner of Revenue by more than 2½percent, subject to exceptions for property added to the tax rolls or property which has had an increase, other than as part ofa general revaluation, in its assessed valuation over the prior year’s valuation.

This “growth” limit on the tax levy may be exceeded in any year by a majority vote of the voters, but an increase inthe secondary or growth limit under this procedure does not permit a tax levy in excess of the primary limitation, since thetwo limitations apply independently. In addition, if the voters vote to approve taxes in excess of the “growth” limit for thepurpose of funding a stabilization fund, such increased amount may only be taken into account for purposes of calculatingthe maximum levy limit in each subsequent year if the board of selectmen of a town or the city council of a city votes by atwo-thirds vote to appropriate such increased amount in such subsequent year to the stabilization fund.

The applicable tax limits may also be reduced in any year by a majority vote of the voters.

The State Commissioner of Revenue may adjust any tax limit “to counterbalance the effects of extraordinary,non-recurring events which occurred during the base year”.

The statute further provides that the voters may exclude from the taxes subject to the tax limits and from thecalculation of the maximum tax levy (a) the amount required to pay debt service on bonds and notes issued beforeNovember 4, 1980, if the exclusion is approved by a majority vote of the voters, and (b) the amount required to pay debtservice on any specific subsequent issue for which similar approval is obtained. Even with voter approval, the holders ofthe obligations for which unlimited taxes may be assessed do not have a statutory priority or security interest in the portionof the tax levy attributable to such obligations. It should be noted that Massachusetts General Laws Chapter 44, Section 20requires that the taxes excluded from the levy limit to pay debt service on any such bonds and notes be calculated based onthe true interest cost of the issue. Accordingly, the Department of Revenue limits the amount of taxes which may be leviedin each year to pay debt service on any such bonds and notes to the amount of such debt service, less a pro rata portion ofany original issue premium received by the city or town that was not applied to pay costs of issuance.

Voters may also exclude from the Proposition 2½ limits the amount required to pay specified capital outlayexpenditures or for the city or town’s apportioned share for certain capital outlay expenditures by a regional governmentalunit. In addition, the city council of a city, with the approval of the mayor if required, or the board of selectmen or the towncouncil of a town may vote to exclude from the Proposition 2½ limits taxes raised in lieu of sewer or water charges to paydebt service on bonds or notes issued by the municipality (or by an independent authority, commission or district) for wateror sewer purposes, provided that the municipality’s sewer or water charges are reduced accordingly.

In addition, Proposition 2½ limits the annual increase in the total assessments on cities and towns by any county,district, authority, the Commonwealth or any other governmental entity (except regional school districts, the MWRA andcertain districts for which special legislation provides otherwise) to the sum of (a) 2½ percent of the prior year’sassessments and (b) “any increases in costs, charges or fees for services customarily provided locally or for servicessubscribed to at local option”. Regional water districts, regional sewerage districts and regional veterans districts mayexceed these limitations under statutory procedures requiring a two-thirds vote of the district’s governing body and eitherapproval of the local appropriating authorities (by two-thirds vote in districts with more than two members or by majorityvote in two-member districts) or approval of the registered voters in a local election (in the case of two-member districts).Under Proposition 2½ any State law to take effect on or after January 1, 1981 imposing a direct service or cost obligation ona city or town will become effective only if accepted or voluntarily funded by the city or town or if State funding isprovided. Similarly, State rules or regulations imposing additional costs on a city or town or laws granting or increasinglocal tax exemptions are to take effect only if adequate State appropriations are provided. These statutory provisions do notapply to costs resulting from judicial decisions.

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Analysis of Property Tax Levies and Levy Limits

The following table reflects the calculation of levy limits for the following fiscal years.

For Fiscal Year

2014 2013 2012 2011 2010

Primary Levy Limit (1) ………… $ 110,008,516 $ 109,784,132 $ 111,260,981 $ 111,366,783 $ 116,917,532

Prior Fiscal Year Levy Limit …… $ 37,686,365 $ 36,516,514 $ 35,404,283 $ 34,136,522 $ 32,746,851

2.5% Levy Growth ……………. 942,159 912,913 885,107 853,413 818,671

New Growth (2) ……………….. 543,716 256,938 227,124 414,348 571,000

Overrides ………………………. -0- -0- -0- -0- -0-

Growth Levy Limit ……………. 39,172,240 37,686,365 36,516,514 35,404,283 34,136,522

Debt Exclusions ………………… 2,045,571 2,094,146 2,342,438 2,054,009 2,116,512

Capital Expenditure Exclusions … -0- -0- -0- -0- -0-

Other Adjustments …………….. 188,785 213,244 208,753 176,812 197,238

Tax Levy Limit ………………… $ 41,406,596 $ 39,993,755 $ 39,067,705 $ 37,635,104 $ 36,450,272

Tax Levy ……………………….. 40,483,134 39,917,510 37,873,238 37,285,599 36,431,503

Unused Levy Capacity (3) …….. $ 923,462 $ 76,245 $ 1,194,467 $ 349,505 $ 18,769

Unused Primary Levy Capacity (4) $ 70,836,276 $ 72,097,767 $ 74,744,467 $ 75,962,500 $ 82,781,010

_________________________

Source: Massachusetts Department of Revenue.

(1) 2.5% of assessed valuation.

(2) Allowed increase for new valuations (or required reduction) - certified by the Department of Revenue.

(3) Tax Levy Limit less Tax Levy.

(4) Primary Levy Limit less Growth Levy Limit.

Pledged Taxes. Taxes on certain property in designated development districts may be pledged for the payment of costs ofeconomic development projects within such districts and may therefore be unavailable for other municipal purposes (see“TAX INCREMENT FINANCING FOR DEVELOPMENT DISTRICTS” below).

Initiative Petitions. Various proposals have been made in recent years for legislative amendments to the MassachusettsConstitution to impose limits on state and local taxes. To be adopted such amendments must be approved by twosuccessive legislatures and then by the voters at a state election.

Tax Rates and Valuations

Property is classified for the purpose of taxation according to its use. The legislature has in substance created threeclasses of taxable property: (1) residential real property, (2) open space land, and (3) all other (commercial, industrialand personal property). Within limits, cities and towns are given the option of determining the share of the annual levyto be borne by each of the three categories. The share required to be borne by residential real property is at least 50 percent of its share of the total taxable valuation; the effective rate for open space must be at least 75 per cent of theeffective rate for residential real property; and the share of commercial, industrial and personal property must notexceed 175 percent of their share of the total valuation. A city or town may also exempt up to 20 percent of thevaluation of residential real property (where used as the taxpayer’s principal residence) and up to 10 percent of thevaluation of commercial real property (where occupied by certain small businesses). Property may not be classified in acity or town until the State Commissioner of Revenue certifies that all property in the city or town has been assessed atits fair cash value. Such certification must take place every three years.

Related statutes provide that certain forest land, agricultural or horticultural land (assessed at the value it has for thesepurposes) and recreational land (assessed on the basis of its use at a maximum of 25 percent of its fair cash value) are all tobe taxed at the rate applicable to commercial property. Land classified as forest land is valued for this purpose at fivepercent of fair cash value but not less than ten dollars per acre.

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The following table reflects the breakdown of assessed valuation by classification for the following fiscal years.

Fiscal 2014 % of Total Fiscal 2013 % of Total Fiscal 2012 % of Total

Assessed Assessed Assessed Assessed Assessed Assessed

Type of Property Valuation Valuation Valuation Valuation Valuation Valuation

Residential ……. $ 4,032,739,047 91.6% $ 4,025,689,935 91.7% $ 4,073,637,011 91.5%

Open Space …… 1,818,900 0.0 1,797,600 0.0 1,796,800 0.0

Commercial …… 288,639,723 6.6 284,115,485 6.5 293,156,639 6.6

Industrial ……… 23,185,500 0.5 24,468,200 0.6 24,549,700 0.6

Personal ………. 53,957,460 1.2 55,294,060 1.3 57,299,090 1.3

Total $ 4,400,340,630 100.0% $ 4,391,365,280 100.0% $ 4,450,439,240 100.0%

_________________________

Source: Massachusetts Department of Revenue.

In order to determine appropriate relative values for the purposes of certain distributions to and assessments uponcities and towns, the Commissioner of Revenue biennially makes his own redetermination of the fair cash value of thetaxable property in each municipality. This is known as the “equalized value”.

The following table reflects the trend in assessed valuations, equalized valuations and percentage of total assessedvaluation to equalized for the following fiscal years.

For Fiscal Year

2014 2013 2012 2011 2010

Real Property(1) ………………. $ 4,346,383,170 $ 4,336,071,220 $ 4,393,140,150 $ 4,396,558,750 $ 4,624,421,650

Personal Property(1) …………… 53,957,460 55,294,060 57,299,090 58,112,560 52,279,640

Total ………………………….. $ 4,400,340,630 $ 4,391,365,280 $ 4,450,439,240 $ 4,454,671,310 $ 4,676,701,290

Equalized Value(2) …………….. $ 4,834,896,100 $ 4,834,896,100 $ 5,208,130,600 $ 5,208,130,600 $ 5,578,976,700

Percent of Total Assessed

to Equalized Valuation ……….. 91.0% 90.8% 85.5% 85.5% 83.8%

_________________________

Source: Massachusetts Department of Revenue.

(1) As of the prior January 1st.

(2) Based on the equalized valuation in effect for each year.

The following shows the actual rates per $1,000 of assessed valuation, and the full value rate for the most recentfiscal years:

For Fiscal Year

Type of Property 2014 2013 2012 2011 2010

Residential ……………………… $9.20 $9.09 $8.51 $8.37 $7.79

Open Space ……………………. 9.20 9.09 8.51 8.37 7.79

Commercial ……………………. 9.20 9.09 8.51 8.37 7.79

Industrial ………………………. 9.20 9.09 8.51 8.37 7.79

Personal ……………………….. 9.20 9.09 8.51 8.37 7.79

Average Tax Rate …………….. $9.20 $9.09 $8.51 $8.37 $7.79

Full Value Tax Rate (1) ………… $8.37 $8.26 $7.27 $7.16 $6.53

_________________________

Source: Massachusetts Department of Revenue.

(1) Based on the equalized valuation in effect for each year.

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Tax Levies and Collections

The taxes for each fiscal year generally are due in two installments on November 1 (subject to deferral if tax bills aresent out late) and May 1. The Town has accepted a statute providing for quarterly tax payments; under that statute,preliminary tax payments are to be due on August 1, and November 1, with payment of the actual tax bill (after credit isgiven for the preliminary payments) in installments on February 1 and May 1 if actual tax bills are mailed by December 31.Interest accrues on delinquent taxes currently at the rate of 14 percent per annum from the due date. Real property (landand buildings) is subject to a lien for the taxes assessed upon it (subject to any paramount federal lien and subject tobankruptcy and insolvency laws). (In addition, real property is subject to a lien for certain unpaid municipal charges orfees.) If the property has been transferred an unenforced lien expires on the fourth December 31, after the end of the fiscalyear to which the tax relates. If the property has not been transferred by the fourth December 31, an unenforced lien expiresupon a later transfer of the property. Provision is made, however, for continuation of the lien where it could not be enforcedbecause of legal impediment. The persons against whom real or personal property taxes are assessed are personally liablefor the tax (subject to bankruptcy and insolvency laws). In the case of real property, this personal liability is effectivelyextinguished by sale or taking of the property as described below.

The following table reflects the total tax levy, the reserve for abatements, the net tax levy, and the amount of levycollected during the fiscal year payable and the total collected against each fiscal year as of December 1, 2013.

For Fiscal Year

2013 2012 2011 2010 2009

Total Tax Levy ………………… $ 39,917,510 $ 37,873,238 $ 37,285,599 $ 36,431,503 $ 34,865,748

Overlay Reserve for Abatements 388,406 337,933 429,929 390,316 350,904

Net Tax Levy (1) ……………… $ 39,529,104 $ 37,535,305 $ 36,855,670 $ 36,041,187 $ 34,514,844

Amount Collected

During Fiscal Year Payable(2) … $ 38,832,249 $ 36,569,022 $ 36,217,080 $ 35,065,906 $ 33,626,007

Percent of Net Tax Levy ……….. 98.2% 97.4% 98.3% 97.3% 97.4%

Amount Collected Through 12/01/13 $ 39,222,079 $ 37,337,467 $ 36,714,232 $ 35,935,601 $ 34,421,610

Percent of Net Tax Levy ………. 99.2% 99.5% 99.6% 99.7% 99.7%

_________________________

(1) Net after deductions of overlay reserve for abatements.

(2) Actual collections of levy less refunds and amounts refundable but including proceeds of tax titles

and tax possessions attributed to such levy but not including abatements or other credits.

Taking and Sale

Massachusetts law permits a municipality either to sell by public sale (at which the municipality may become thepurchaser) or to take real property for non-payment of taxes thereon. In either case the property owner can redeem theproperty by paying the unpaid taxes, with interest and other charges, but if the right of redemption is not exercised withinsix months (which may be extended an additional year in the case of certain installment payments) it can be foreclosed bypetition to the land court. Upon foreclosure, a tax title purchased or taken by the municipality becomes a “tax possession”and may be held and disposed of like any land held for municipal purposes. Cities and towns are authorized to selldelinquent property tax receivables by public sale or auction, either individually or in bulk.

Taxes Outstanding

The following table sets forth the amount of overdue property taxes, tax titles and possessions outstanding at the end ofthe last five fiscal years.

For Fiscal Year

2013 2012 2011 2010 2009

Aggregate (1) ……………………. $ 658,243 $ 931,018 $ 717,837 $939,597 $889,833

For Current Year (1) ……………. 561,897 719,565 602,572 791,645 726,801

Tax Titles …………………….….. 1,001,311 1,266,926 1,054,170 993,187 860,343

Tax Possessions ……………….... 686,349 684,157 644,739 644,739 644,739

_________________________

(1) Excludes tax titles, tax possessions and abated taxes. Includes taxes in litigation, if any.

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Abatements and Overlay

The Town is authorized by law to increase each tax levy by an amount approved as reasonable by the StateCommissioner of Revenue for an “overlay” to provide for tax abatements. If abatements are granted in excess of theapplicable overlay reserve, the resultant “overlay deficit” is required to be added to the next tax levy. Abatements aregranted where real or personal property has been overvalued or disproportionately valued. The assessors may also abateuncollectible personal property taxes. They may abate real and personal property taxes on broad grounds (includinginability to pay) with the approval of the State Commissioner of Revenue. Uncollectible real property taxes are ordinarilynot written off until they become municipal tax titles (either by purchase at the public sale or by taking), at which time thetax is written off in full by reserving the amount of tax and charging surplus. The following table reflects the total tax levy,the reserve for abatements and the amount of abatements granted during the fiscal year of the levy.

The following table reflects the total tax levy, the reserve for abatements, and the amount of abatements grantedduring the fiscal year of the levy.

For Fiscal Year

2013 2012 2011 2010 2009

Tax Levy (1) ……………………. $39,917,510 $37,873,238 $37,285,599 $36,431,503 $34,865,748

Overlay Reserve for Abatements (1) 388,406 337,933 429,929 390,316 350,904

Percent of Tax Levy …………… 1.0% 0.9% 1.2% 1.1% 1.0%

Abatements Granted:

During Fiscal Year of Levy …… $246,022 $269,532 $203,517 $233,550 $251,449

Through 12/01/13 249,497 292,380 221,863 370,864 295,585

_________________________

(1) Massachusetts Department of Revenue.

Ten Largest Taxpayers

The following is a list of the ten largest taxpayers for fiscal year 2014(1).2014 % of

Assessed Assessed

Name Nature of Business Valuation Valuation

New Seabury Properties LLC Real Estate Development/Management $ 67,645,680 1.54%

Mashpee Commons II LLC Mall 46,219,500 1.05

Baywater Seaside II LLC Real Eastate 22,908,400 0.52

Mashpee Commons LLC Mall 16,365,300 0.37

NSTAR Utility 16,161,830 0.37

Mashpee Investors Real Estate 15,362,300 0.35

Southworth Willowbend LLC Golf Course 15,111,800 0.34

Mashpee Commons LP Mall 15,008,000 0.34

New Seabury Golf Club LLC Golf Course 13,321,400 0.30

Southworth Mashpee Properties LLC Real Estate 12,203,900 0.28

$ 240,308,110 5.46%

_____________________________

(1) All of the largest taxpayers listed are current on their real estate and personal property taxes.

Cape Cod Open Space Land Acquisition Excise Tax

An excise tax of 3% of the real estate tax levy against real property in the Town is levied by the Town under the CapeCod Open Space Land Acquisition Program authorized by Chapter 293 of the Acts of 1998, as amended (the “Land BankAct”). This levy is not counted in the total taxes assessed for the purposes of determining the permitted levy amount underProposition 2 ½ (see “Property Tax Limitation” above). The proceeds of the excise tax, together with state matching fundsequal to 50% of the amounts collected under the excise tax, are deposited in the Land Bank Fund held by the Town for thepurposes of acquiring land and interests in land for the protection of public drinking water supplies, open space andconservation land and the creation of walking trails, bicycling trails and recreation areas. Under the terms of the Land BankAct, the excise tax expires on January 1, 2020.

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Community Preservation Act

The Massachusetts Community Preservation Act (the “CPA”) permits cities and towns that accept its provisions tolevy a surcharge on its real property tax levy, dedicate revenue (other than state or federal funds), and to receive statematching funds for (i) the acquisition, creation, preservation, rehabilitation and restoration of land for recreational use,open space and affordable housing and (ii) the acquisition, preservation, rehabilitation and restoration of historicresources. The provisions of the CPA must be accepted by the voters of the city or town at an election after suchprovisions have first been accepted by either a vote of the legislative body of the city or town or an initiative petitionsigned by 5% of its registered voters.

A city or town may approve a surcharge of up to 3% (but not less than 1% under certain circumstances) and maymake an additional commitment of funds by dedicating revenue other than state or federal funds, provided that the totalfunds collected do not exceed 3% of the real property tax levy, less any exemptions adopted (such as an exemption forlow-income individuals and families and for low and moderate-income senior citizens, an exemption for $100,000 ofthe value of each taxable parcel of residential real property or $100,000 of the value of each taxable parcel of classthree, commercial property, and class four, industrial property as defined in Chapter 59, Section 2A of the GeneralLaws, and an exemption for commercial and industrial properties in cities and towns with classified tax rates). In theevent that the municipality shall no longer dedicate all or part of the additional funds to community preservation, thesurcharge on the real property tax levy of not less than 1% shall remain in effect, provided that any such change mustbe approved pursuant to the same process as acceptance of the CPA. The surcharge is not counted in the total taxesassessed for the purpose of determining the permitted levy amount under Proposition 2½ (see “Tax Limitations” under“PROPERTY TAXATION” herein). A city or town may revoke its acceptance of the provisions of the CPA at anytime after 5 years from the date of such acceptance and may change the amount of the surcharge or the exemptions tothe surcharge at any time, including reducing the surcharge to 1% and committing additional municipal funds asoutlined above, provided that any such revocation or change must be approved pursuant to the same process asacceptance of the CPA.

Any city or town that accepts the provisions of the CPA will receive annual state matching grants to supplementamounts raised by its surcharge and dedication of revenue. The state matching funds are raised from certain recordingand filing fees of the registers of deeds. Those amounts are deposited into a state trust fund and are distributed to citiesand towns that have accepted the provisions of the CPA, which distributions are not subject to annual appropriation bythe state legislature. The amount distributed to each city and town is based on a statutory formula and the total statedistribution made to any city or town may not exceed 100% of the amount raised locally by the surcharge on the realproperty tax levy.

The amounts raised by the surcharge on taxes, the dedication of revenue and received in state matching funds arerequired to be deposited in a dedicated community preservation fund. Each city or town that accepts the provisions ofthe CPA is required to establish a community preservation committee to study the community preservation needs of thecommunity and to make recommendations to the legislative body of the city or town regarding the communitypreservation projects that should be funded from the community preservation fund. Upon the recommendations of thecommittee, the legislative body of the city or town may appropriate amounts from the fund for permitted communitypreservation purposes or may reserve amounts for spending in future fiscal years, provided that at least 10% of the totalannual revenues to the fund must be spent or set aside for open space purposes, 10% for historic resource purposes and10% for affordable housing purposes.

The CPA authorizes cities and towns that accept its provisions to issue bonds and notes in anticipation of thereceipt of surcharge and dedicated revenues to finance community preservation projects approved under the provisionsof the CPA. Bonds and notes issued under the CPA are general obligations of the city or town and are payable fromamounts on deposit in the community preservation fund. In the event that a city or town revokes its acceptance of theprovisions of the CPA, the surcharge shall remain in effect until all contractual obligations incurred by the city or townprior to such revocation, including the payment of bonds or notes issued under the CPA, have been fully discharged.

The Town adopted the CPA with a 3% surcharge on all real estate tax bills effective July 1, 2005 which replacedthe Land Bank Fund. The balance in the community preservation fund as of June 30, 2013 is $6,261,828.

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TOWN FINANCES

Budget and Appropriation Process

The annual appropriations of a town are ordinarily made at the annual meeting which takes place in February, March,April, May or June. Appropriations may also be voted at special meetings. Every town must have an appropriation,advisory or finance committee. The committee (or the board of selectmen if authorized by by-law) is required to submit abudget of proposed expenditures at the annual town meeting.

Town meeting may at any time vote to transfer any amount previously appropriated to any other authorized use bylaw, and, under certain circumstances and subject to certain limits and requirements, the selectmen of a town, with theconcurrence of the finance committee, may transfer amounts appropriated for the use of any department to any otherappropriation for the same department or to any other department.

Water and sewer department expenditures are generally included in the budgets adopted by city councils and townmeetings but electric and gas department funds may be appropriated by the municipal light boards. Under certain legislationany city or town which accepts the legislation may provide that the appropriation for the operating costs of any departmentmay be offset, in whole or in part, by estimated receipts from fees charged for services provided by the department. It isassumed that this general provision does not alter the pre-existing power of an electric or gas department to appropriate itsown receipts.

The school budget is limited to the total amount appropriated by the town meeting but the school committee retainsfull power to allocate the funds appropriated. State legislation known as the Education Reform Act of 1993, as amended,imposes certain minimum expenditure requirements on municipalities with respect to funding for education. Therequirements are determined on the basis of formulas affected by various measures of wealth and income, enrollments, priorlevels of local spending and state aid, and other factors. (See “State Distributions” below.)

State and county assessments, abatements in excess of overlays, principal and interest not otherwise provided for, andfinal judgments are included in the tax levy whether or not included in the budget. Revenues are not required to be set forthin the budget but estimated non-tax revenues are taken into account by the assessors in fixing the tax levy. (See “PropertyTaxation” above.)

Operating Budget Trends

The following table sets forth the operating budgets for the following fiscal years as voted by the Town. As such,said budgets reflect neither revenues nor state and county assessments and other mandatory items nor supplementalbudget appropriations. See “Budget and Appropriation Process” above. Similarly, the budgets summarized belowexclude expenditures for “non-operating” or extraordinary items authorized under “special” warrant articles at specialtown meetings.

Appropriated Appropriated Appropriated Appropriated Appropriated

Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year

2014 2013 2012 2011 2010

General Government……… $ 4,020,179 $ 4,016,327 $ 2,805,324 $ 2,705,146 $ 2,800,305

Public Safety……………… 7,434,356 7,141,048 6,963,324 7,027,781 7,335,806

Unclassified/Recreation…… 306,086 302,214 1,098,245 916,466 635,839

Public Works……………… 3,711,872 3,713,577 3,748,273 3,489,758 3,630,417

School…………………….. 20,481,059 20,051,212 19,515,938 19,147,360 19,537,280

Health/Sanitation ………… 1,123,431 1,107,116 1,400,016 1,117,172 1,080,067

Veteran's/Library………… 609,342 498,713 487,743 446,013 378,961

Debt Service…………….. 4,652,001 4,649,728 4,973,873 4,571,498 4,795,407

Pension/Employee Benefits 8,881,899 8,382,745 8,913,124 8,678,367 8,383,649

Totals: $ 51,220,225 $ 49,862,680 $ 49,905,860 $ 48,099,561 $ 48,577,731

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Retirement Plan

The Massachusetts General Laws provide for the establishment of contributory retirement systems for stateemployees, for teachers and for county, city and town employees other than teachers. Teachers are assigned to a separatestatewide teachers’ system and not to the city and town systems. For all employees other than teachers, this law is subjectto acceptance in each city and town. Substantially all employees of an accepting city or town are covered. If a town has apopulation of less than 10,000 when it accepts the statute, its non-teacher employees participate through the county systemand its share of the county cost is proportionate to the aggregate annual rate of regular compensation of its coveredemployees. In addition to the contributory systems, cities and towns provide non-contributory pensions to a limited numberof employees, primarily persons who entered service prior to July 1, 1937 and their dependents. The Public EmployeeRetirement Administration Commission (“PERAC”) provides oversight and guidance for and regulates all state and localretirement systems.

The obligations of a city or town, whether direct or through a county system, are contractual legal obligations and arerequired to be included in the annual tax levy. If a city or town, or the county system of which it is a member, has notestablished a retirement system funding schedule as described below, the city or town is required to provide for the paymentof the portion of its current pension obligations which is not otherwise covered by employee contributions and investmentincome. “Excess earnings,” or earnings on individual employees’ retirement accounts in excess of a predetermined rate, arerequired to be set aside in a pension reserve fund for future, not current, pension liabilities. Cities and towns may voluntarilyappropriate to their system’s pension reserve fund in any given year up to five percent of the preceding year’s tax levy. Theaggregate amount in the fund may not exceed ten percent of the equalized valuation of the city or town.

If a city or town, or each member city and town of a county retirement system, has accepted the applicable law, it isrequired to annually appropriate an amount sufficient to pay not only its current pension obligations, but also a portion of itsfuture pension liability. The portion of each such annual payment allocable to future pension obligations is required to bedeposited in the pension reserve fund. The amount of the annual city or town appropriation for each such system isprescribed by a retirement system funding schedule which is periodically reviewed and approved by PERAC. Eachsystem’s retirement funding schedule is designed to reduce the unfunded actuarial pension liability of the system to zero bynot later than June 30, 2030, with annual increases in the scheduled payment amounts of not more than 4.5 percent. Thefunding schedule must provide that the payment in any year of the schedule is not less than 95% of the amount appropriatedin the previous fiscal year. City, town and county systems which have an approved retirement funding schedule receiveannual pension funding grants from the Commonwealth for the first 16 years of such funding schedule. Pursuant to Chapter188 of the Acts of 2010, a system (other than the state employee’s retirement system and the teacher’s retirement system)which conduct an actuarial valuation as of January 1, 2009, or later, may establish a revised schedule which reduces theunfunded actuarial liability to zero by not later than June 30, 2040, subject to certain conditions. If the schedule is soextended under such provision and a later updated valuation allows for the development of a revised schedule with reducedpayments, the revised schedule shall be adjusted to provides that the appropriation or each year shall not be less than that forsuch year under the prior schedule, thus providing for a shorter schedule rather than reduced payments.

City, town and county systems may choose to participate in the Pension Reserves Investment Trust Fund (the “PRITFund”), which receives additional state funds to offset future pension costs of participating state and local systems. If a localsystem participates in the PRIT Fund, it must transfer ownership and control of all assets of its system to the PensionReserves Investment Management Board, which manages the investment and reinvestment of the PRIT Fund. Cities andtowns with systems participating in the PRIT Fund continue to be obligated to fund their pension obligations in the mannerdescribed above. The additional state appropriations to offset future pension liabilities of state and local systemsparticipating in the PRIT Fund are required to total at least 1.3 percent of state payroll. Such additional state appropriationsare deposited in the PRIT Fund and shared by all participating systems in proportion to their interests in the assets of thePRIT Fund as of July 1 for each fiscal year.

Cost-of-living increases for each local retirement system may be granted and funded only by the local system, andonly if it has established a funding schedule. Those statutory provisions are subject to acceptance by the local retirementboard and approval by the local legislative body, which acceptance may not be revoked.

The Town provides pension benefits to employees by contributing to the Barnstable County Retirement System (the“System”), a cost sharing multiple-employer defined benefit pension plan administered by the Barnstable CountyRetirement Board. The System provides retirement benefits, cost of living adjustments, disability benefits and deathbenefits. Substantially all employees of the Town are members of the System except for public school teachers and certainadministrators who are members of the Massachusetts Teachers Retirement System, to which the Town does not contribute.

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The System is a member of the Massachusetts Contributory Retirement System and is governed by Chapter 32 of theMassachusetts General Laws.

The annual contributions of the Town to the Contributory retirement system for the following fiscal years are set forthbelow.

For Fiscal Year

2014 2013 2012 2011 2010

Contributory…………….……. $2,363,797 (1) $2,177,885 $2,086,262 $1,973,785 $1,858,950

_________________________

(1) Budgeted.

The foregoing data does not include the retirement system costs or liabilities attributable to employees of theCounty or the retirement system costs or liabilities of any other entity of which the Town is a constituent part.

As of January 1, 2012, Barnstable County’s total estimated past service liability in the contributory retirementsystem was $1,173,483,848, and its assets were $651,063,981, leaving an estimated unfunded past service liability of$522,419,867 assuming 7.875% rate of return and fully funded by 2038.

Other Post-Employment Benefits

In addition to pension benefits, cities and towns may provide retired employees with health care and life insurancebenefits. The portion of the cost of such benefits paid by cities or towns is generally provided on a pay-as-you-gobasis. The pay-as-you-go cost to the Town for such benefits in recent years has been as follows:

For Fiscal Year

2013 2012 2011 2010 2009

Contributions……………….. $1,411,152 $1,357,031 $1,219,727 $1,027,878 $936,309

The Governmental Accounting Standards Board (“GASB”) recently promulgated its Statement Nos. 43 and 45, whichwill for the first time require public sector entities to report the future costs of these non-pension, post-employment benefitsin their financial statements. These new accounting standards do not require pre-funding the payment of these costs as theliability for such costs accrues, but the basis applied by the standards for measurement of costs and liabilities for thesebenefits is conservative if they continue to be funded on a pay-as-you-go basis and will result in larger yearly cost andliability accruals than if such benefits were pre-funded in a trust fund in the same manner as traditional pension benefits.Cities and towns that choose to self-insure all or a portion of the costs of the health care benefits they provide to employeesand retirees may establish a trust fund for the purposes of paying claims. The Town established an OPEB Stabilization Fundat its 2013 Annual Town Meeting and has funded it with $250,000.

The Town adopted the requirements of GASB Statement 45 which required public sector entities to report the futurecosts of these non-pension, post-employment benefits in their financial statements. The Town’s annual other post-employment benefit cost is calculated based on the annual required contribution of the employer (“ARC”), an amountactuarially determined in accordance with the parameters of GASB Statement No. 45. The ARC represents a level offunding that, if paid on an ongoing basis, is projected to cover normal costs each year and amortize any unfunded actuarialliabilities (or funding excess) over a period not to exceed thirty years. At June 30, 2013, the ARC was determined to be$4,509,361, the annual other post-employment benefit cost was determined to be $4,660,289, and the amount actuallycontributed to the plan was $1,321,956. The net other post-employment benefits obligation at July 1, 2012 was$17,751,442, leaving a net OPEB obligation of $21,089,775 at June 30, 2013.

As of July 1, 2012, the most recent valuation date, the unfunded actuarial accrued liability for the Town’s post-employment benefits was $62,263,573 based upon a 4.50% discount rate.

State School Building Assistance Program

Under its school building assistance program, the Commonwealth provides grants to cities, towns and regional schooldistricts for school construction projects. Until July 26, 2004, the State Board of Education was responsible for approving

31

grants for school projects and otherwise administering the program. Grant amounts ranged from 50% to 90% of approvedproject costs. Municipalities generally issued bonds to finance the entire project cost, and the Commonwealth disbursed thegrants in equal annual installments over the term of the related bonds.

Pursuant to legislation which became effective on July 26, 2004, the state legislature created the Massachusetts SchoolBuilding Authority (the “Authority”) to finance and administer the school building assistance program. The Authority hasassumed all powers and obligations of the Board of Education with respect to the program. In addition to certain otheramounts, the legislation dedicates a portion of Commonwealth sales tax receipts to the Authority to finance the program.

Projects previously approved for grants by the State Board of Education are entitled to receive grant payments fromthe Authority based on the approved project cost and reimbursement rate applicable under the prior law. The Authority haspaid and is expected to continue to pay the remaining amounts of the grants for such projects either in annual installments toreimburse debt service on bonds issued by the municipalities to finance such projects, or as lump sum payments tocontribute to the defeasance of such bonds.

Projects on the priority waiting list as of July 1, 2004 are also entitled to receive grant payments from the Authoritybased on the eligible project costs and reimbursement rates applicable under the prior law. With limited exceptions, theAuthority is required to fund the grants for such projects in the order in which they appear on the waiting list. Grants forany such projects that have been completed or substantially completed have been paid and are expected to continue to bepaid by the Authority in lump sum payments, thereby eliminating the need for the Authority to reimburse interest expensesthat would otherwise be incurred by the municipalities to permanently finance the Authority’s share of such project costs.Interest on debt issued by municipalities prior to July 1, 2004 to finance such project costs, and interest on temporary debtuntil receipt of the grant, is included in the approved costs of such projects. Grants for any such projects that have not yetcommenced or that are underway have been and are expected to continue to be paid by the Authority as project costs areincurred by the municipality pursuant to a project funding agreement between the Authority and the municipality,eliminating the need for the municipality to borrow even on a temporary basis to finance the Authority’s share of the projectcosts in most cases.

The range of reimbursement rates for new project grant applications submitted to the Authority on or after July 1,2007 has been reduced to between 40% and 80% of approved project costs. The Authority promulgated new regulationswith respect to the application and approval process for projects submitted after July 1, 2007. The Authority expects to paygrants for such projects as project costs are incurred pursuant to project funding agreements between the Authority and themunicipalities. None of the interest expense incurred on debt issued by municipalities to finance their portion of the costsof new projects will be included in the approved project costs eligible for reimbursement.

Investments

Investments of funds of cities and towns, except for trust funds, are generally restricted by Massachusetts GeneralLaws Chapter 44, §55. That statute permits investments of available revenue funds and bond and note proceeds in termdeposits and certificates of deposits of banks and trust companies, in obligations issued or unconditionally guaranteed bythe federal government or an agency thereof with a maturity of not more than one year, in repurchase agreements with amaturity of not more than 90 days secured by federal or federal agency securities, in participation units in the MassachusettsMunicipal Depository Trust (“MMDT”), or in shares in SEC-registered money market funds with the highest possiblerating from at least one nationally recognized rating organization.

MMDT is an investment pool created by the Commonwealth. The State Treasurer is the sole trustee, and the funds aremanaged under contract by an investment firm under the supervision of the State Treasurer’s office. According to the StateTreasurer the Trust’s investment policy is designed to maintain an average weighted maturity of 90 days or less and islimited to high-quality, readily marketable fixed income instruments, including U.S. Government obligations and highly-rated corporate securities with maturities of one year or less.

Trust funds, unless otherwise provided by the donor, may be invested in accordance with §54 of Chapter 44, whichpermits a broader range of investments than §55, including any bonds or notes that are legal investments for savings banksin the Commonwealth. The restrictions imposed by §§54 and 55 do not apply to city and town retirement systems.

Contractual Obligations

Municipal contracts are generally limited to currently available appropriations. A city or town generally has theauthority to enter into contracts for the exercise of any of its corporate powers for any period of time deemed to serveits best interest, but generally only when funds are available for the first fiscal year; obligations for succeeding fiscal

32

years generally are expressly subject to availability and appropriation of funds. Municipalities have specific authorityin relatively few cases to enter into long-term contractual obligations that are not subject to annual appropriation,including contracts for refuse disposal and sewage treatment and disposal. Municipalities may also enter into long-term contracts in aid of housing and renewal projects. There is implied authority to make other long-term contractsrequired to carry out authorized municipal functions, such as contracts to purchase water from private water companies.

The Town of Mashpee is obligated under three contracts of significance as follows:

Mashpee has entered into a twenty-year contract for solid waste disposal services with SEMASS, a resource recoveryfacility in the Town of Rochester, Massachusetts. The contract is due to expire on January 1, 2015. The Town is allocateda cost of service based on the actual number of tons of solid waste disposed of at the facility. The Town was assessed anannual fiscal 2013 cost of approximately $205,000 based on a projected annual disposal rate of 6,000 tons of solid waste.The Town receives reimbursement of the tipping fee for approximately 2,000 of these tons from other users.

The Town entered into a contract with Bay Colony Massachusetts Coastal Railroad for the delivery and transportationof all solid waste intended for SEMASS. The cost of the service is based on the actual tons of solid waste transported toSEMASS. The fiscal year 2013 budget was $95,000 based on a projected transportation of 8,000 tons. The Town receivesreimbursement of the transportation fee of approximately 4,000 tons from other users.

The Town has entered into an Inter-municipal Agreement with the Towns of Falmouth and Sandwich for theconstruction, maintenance and operation of a Solid Waste Rail Transfer Station at the Massachusetts Military Reservation(Otis). Mashpee’s share is 22.64% of the operating cost as is determined by the Board of Managers on an annual basisbased on the prior calendar year’s use. Mashpee has one member on the Board. The fiscal year 2013 budget was $72,000which represents 23% use. The Town receives reimbursement of approximately 50% of this cost from other users.

The Town of Mashpee is obligated under lease agreements with the following:

Purpose of Lease Approximate Annual Lease Payment

10 Police Cruisers $120,000 year two of three-year lease

4 Police Vehicles $56,400 year one of three-year lease

Motor Vehicle Excise

An excise is imposed on the registration of motor vehicles (subject to exemptions) at the rate of $25 per $1,000 ofvaluation. The excise is collected by and for the benefit of the municipality in which the motor vehicle is customarily kept.Valuations are determined by a statutory formula based on manufacturers’ list price and year of manufacture. Bills not paidwhen due bear interest at 12 percent per annum. Provision is also made, after notice to the owner, for suspension of theowner’s operating license or registration by the registrar of motor vehicles.

The Town collects the motor vehicle excise tax from bills prepared by the Massachusetts Registry of Motor Vehicles.The following table reflects motor vehicle excise receipts for each of the following fiscal years.

For Fiscal Year Ending June 30

2013 2012 2011 2010 2009

Motor Vehicle Excise Taxes …..…… $1,794,083 $1,643,953 $1,615,882 $1,551,645 $1,587,887

_________________________

Source: Massachusetts Department of Revenue - Net after refunds. Includes receipts for prior years.

Other Taxes

Three additional sources of revenue for local governments are the room occupancy excise tax, local meals excise taxand the aviation fuel tax. All taxes take effect only where accepted by individual municipalities. Under the roomoccupancy excise tax, local governments may tax the provision of hotel, motel, lodging house and bed and breakfast roomsat a rate not to exceed four percent of the cost of renting such rooms. The tax is paid by the owner of each establishment tothe State Commissioner of Revenue, who in turn pays the tax back to the municipality in which the rooms are located. Infiscal 2012 and 2013, the Town collected $61,109 and $67,107, respectively in room occupancy excise tax and expects tocollect approximately $30,000 for fiscal 2014.

33

The local meals excise tax, effective for sales of restaurant meals on or after October 1, 2009, is a three-fourths percenttax on the gross receipts of a vendor from the sale of restaurant meals. The tax is paid by the vendor to the StateCommissioner of Revenue, who in turn pays the tax to the municipality in which the meal was sold. The Town has notvoted to accept the local meals excise tax.

The aviation fuel tax is a five percent tax (with a minimum of five cents per gallon) on the sale or use of jet fuel to or byjet aircraft. The tax is paid by the seller/user of the fuel to the Commissioner of revenue, who in turn, rebates the tax backto the municipality in which the fuel being taxed was transferred to an aircraft. The Town has not voted to accept theaviation fuel tax.

State Aid

In addition to grants for specified capital purposes (some of which are payable over the life of the bonds issued for theprojects), the Commonwealth provides financial assistance to cities and towns for current purposes. Payments to cities andtowns are derived primarily from a percentage of the State’s personal income, sales and use, and corporate excise taxreceipts, together with the net receipts from the State Lottery. A municipality’s state aid entitlement is based on a number ofdifferent formulas, of which the “schools” and “lottery” formulas are the most important. Both of the major formulas tendto provide more state aid to poorer communities. The formulas for determining a municipality’s state aid entitlement aresubject to amendment by the state legislature and, while a formula might indicate that a particular amount of state aid isowed, the amount of state aid actually paid is limited to the amount appropriated by the state legislature. The state annuallyestimates state aid, but the actual state aid payments may vary from the estimate.

In the fall of 1986, both the State Legislature (by statute, repealed as of July 1, 1999) and the voters (by initiativepetition) placed limits on the growth of state tax revenues. Although somewhat different in detail, each measure essentiallylimited the annual growth in state tax revenues to an average rate of growth in wages and salaries in the Commonwealthover the three previous calendar years. If not amended, the remaining law could restrict the amount of state revenuesavailable for state aid to local communities.

Legislation was enacted in 1991 to help municipalities compensate for additional local aid reductions by theCommonwealth for fiscal year 1992. Under that law, municipalities were allowed to defer budgeting for teacher’s summercompensation payable by the end of the fiscal years 1992 and 1993. Municipalities that chose to defer such amounts arerequired to amortize the resulting budget deficiency by raising at least one fifteenth of the deferred amount in each of thefiscal years 1997 through 2011, or in accordance with a more rapid amortization schedule.

The following reflects state receipts in each of the following fiscal years:

For Fiscal Year

2014(1) 2013 2012 2011 2010

School Operating Aid……………… $ 4,779,744 $ 4,649,475 $ 4,479,450 $ 4,373,588 $ 4,437,308

Other State Aid……………………. 910,763 874,643 833,437 858,451 1,299,511

Supplemental Budget………………. - - 22,500 - -

Less Estimated Charges……………. (1,740,746) (1,465,759) (1,323,403) (1,062,416) (940,691)

Total State Aid: $ 3,949,761 $ 4,058,359 $ 4,011,984 $ 4,169,623 $ 4,796,128

_________________________

(1) Estimated.

Undesignated General Fund Balance and Free Cash

Under Massachusetts law, an amount known as “free cash” is certified as of the beginning of each fiscal year bythe State Bureau of Accounts and this, together with certain subsequent tax receipts, is used as the basis for subsequentappropriations from available funds, which are not required to be included in the annual tax levy. Subject to certainadjustments, free cash is surplus revenue less uncollected and overdue property taxes from prior years. Free cash as ofthe beginning of the fiscal year, together with collections of prior years’ taxes through March 31, is available undercurrent law for appropriation to reduce the following fiscal years’ tax levy.

34

The following table reflects the undesignated fund balance and certified free cash for the following fiscal years.

For Fiscal Year Beginning July 1

2013 2012 2011 2010 2009

Undesignated Fund Balance (1)…….. $10,280,566 $8,689,780 $8,739,488 $4,013,962 $3,057,059

Free Cash ……………..…………….. 4,925,505 3,689,876 3,595,391 2,949,637 1,807,815

_________________________Source: Town’s audits and the Massachusetts Department of Revenue(1) Starting in fiscal year 2011 as a result of GASB 54, the fund balance numbers are the Unassigned as extracted from the Town’s

audited financial statements and includes the Stabilization Fund balance.

Stabilization Fund

Under Section 5B of Chapter 40 of the Massachusetts General Laws, the Town may for the purpose of creating astabilization fund, appropriate in any year an amount not exceeding ten percent of the amount raised in the precedingyear by taxation of real estate and tangible personal property or such larger amount as may be approved by theMunicipal Finance Oversight Board. The aggregate amount in the fund at any time shall not exceed ten percent of theequalized valuation of the Town and any interest shall be added to and become a part of the fund. The stabilizationfund may be appropriated in a town at a town meeting and also at a special town meeting by a two-thirds vote for anylawful purpose.

The following table reflects the Stabilization Fund Balance for the following fiscal years.

For Fiscal Year Ending June 30

2013 2012 2011 2010 2009

Stabilization Fund Balance …..….…. $3,989,381 $3,765,448 $3,620,544 $3,530,990 $3,367,413

Financial Statements

Comparative balance sheets and revenues and expenditures have been extracted from the Town’s financialstatements for the fiscal years ending June 30, 2009 through 2013 prepared by Sullivan, Rogers & Company, LLCCertified Public Accountants and are included as Appendix A. The Town’s draft financial statements for the fiscal yearended June 30, 2013 audited by Sullivan, Rogers & Company, LLC, in their entirety, is included as Appendix B.

Litigation

In the opinion of the Town, there is no litigation pending which, either individually or in the aggregate, is likely toresult in final judgments against the Town which would materially affect the Town’s financial position or its ability topay its obligations.

TOWN OF MASHPEE,MASSACHUSETTS

By: /s/ Craig MayenTown Treasurer

Dated: January 13, 2014

_________________________

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TOWN OF MASHPEE, MASSACHUSETTS

COMPARATIVE BALANCE SHEETS

GENERAL ACCOUNTS (1)

APPENDIX A

2013 2012 2011 2010 2009

Assets:

Cash and cash equivalents 11,643,270$ 9,877,951$ 12,659,344$ 9,780,706$ 8,680,906$Investments 3,934,166 3,678,622 3,543,608 - -Receivables, net of allowance for uncollectible amounts:

Real estate and personal property taxes 667,847 731,185 733,226 791,247 913,398Real estate tax defferals 27,092 24,089 27,760 22,246 16,609Tax liens 1,001,326 1,266,926 1,080,719 925,724 846,139Motor vehicle and other excise taxes 328,521 282,526 348,157 297,278 300,145Departmental and other - - - - -Intergovernmental 3,478,454 4,222,422 4,932,764 5,599,239 6,222,023

Tax foreclosures 686,349 684,158 684,158 684,158 684,158Restricted assets:

Cash and cash equivalents 279,625 307,070 - - -Investments 262,824 - - - -

Total Assets 22,309,474$ 21,074,949$ 24,009,736$ 18,100,598$ 17,663,378$

Liabilities and Fund Balances:

Liabilities:

Warrants payable 461,280$ 403,623$ 973,024$ 1,075,438$ 747,110$Accrued payroll 1,780,022 1,581,369 2,880,600 1,560,540 1,559,703Tax refunds payable - 238,803 90,058 49,370 26,571Other liabilities 356,454 310,999 851,997 409,631 388,667Abandoned property - - - - 14,017Deferred revenues 5,835,482 6,943,942 7,596,088 8,065,985 8,631,970Accrued short-term interest - - - 56,939 11,096

Total Liabilities 8,433,238 9,478,736 12,391,767 11,217,903 11,379,134

Fund Balances:

Reserved for encumbrances and continuing

appropriations - - - 1,311,366 887,193Unreserved:

Designated for subsequent year's expenditures - - - 1,557,367 2,339,992Undesignated - - - 4,013,962 3,057,059

Restricted 542,449 307,070 - - -Committed 2,782,161 2,356,397 2,600,176 - -Assigned 271,060 242,966 278,305 - -Unassigned 10,280,566 8,689,780 8,739,488 - -Total Fund Balances 13,876,236 11,596,213 11,617,969 6,882,695 6,284,244

Total Liabilities and Fund Balances 22,309,474$ 21,074,949$ 24,009,736$ 18,100,598$ 17,663,378$

(1) Excerpts from audited financial statements prepared by Sullivan, Rogers & Company, LLC.

June 30,

A-1

TOWN OF MASHPEE, MASSACHUSETTS

COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURESAND CHANGES IN FUND BALANCES

GENERAL ACCOUNTS (1)

2013 2012 2011 2010 2009Revenues:Real estate and personal property taxes 39,971,702$ 37,296,290$ 36,796,554$ 35,814,196$ 34,477,754$Motor vehicle and other excise taxes 1,846,134 1,695,674 1,676,524 1,609,377 1,649,027Tax liens 413,965 126,882 108,472 224,965 121,819Payments in lieu of taxes 10,478 3,971 9,047 11,139Charges for services 219,720 220,860 229,345 305,393 257,801Trash disposal 690,207 672,848 678,221 643,429 556,957Intergovernmental 9,097,332 8,788,411 8,341,686 8,487,488 8,332,667Penalties and interest on taxes 493,629 263,081 245,797 378,239 217,498Licenses, permits and fees 468,801 376,344 343,032 320,075 282,874Fines and forfeitures 69,367 51,025 48,390 42,391 37,799Departemental and other 180,032 221,620 200,987 142,934 165,456Investment income 66,834 347,785 252,036 232,854 441,141

Total Revenues 53,528,201 50,064,791 48,930,091 48,212,480 46,540,793

Expenditures:Current:General government 2,611,281 2,486,223 2,699,996 2,535,646 2,685,148Public safety 7,589,961 7,565,049 7,419,195 7,622,061 7,481,464Education 19,891,185 19,160,834 19,097,897 19,462,744 20,989,598Public works 4,840,256 4,428,142 4,206,883 4,111,595 2,790,089Health and human services 630,403 631,567 599,103 608,119 596,859Culture and recreation 687,424 669,707 648,392 630,004 616,908Pension benefits 4,767,762 4,362,915 3,960,961 3,504,309 3,287,301Employee benefits 5,623,348 6,117,801 5,535,873 5,283,574 4,752,714Property and liability insurance 470,822 474,779 434,867 500,283 483,625

State and county charges 1,608,755 1,256,349 1,080,029 901,622 877,550Debt service:Principal 3,521,363 3,690,900 3,317,346 3,380,395 3,099,994Interest 1,163,353 1,321,242 1,243,805 1,437,370 1,447,226

Total Expenditures 53,405,913 52,165,508 50,244,347 49,977,722 49,108,476

Excess (Deficiency) of Revenues OverExpenditures 122,288 (2,100,717) (1,314,256) (1,765,242) (2,567,683)

Other Financing Sources (Uses):Transfers in 2,217,735 2,198,961 2,241,686 2,569,422 2,118,999Transfers out (60,000) (120,000) (60,000) (205,729) (70,070)Premium from issuance on bonds and notes - - 336,854 - 120

Total Other Financing Sources (Uses) 2,157,735 2,078,961 2,518,540 2,363,693 2,049,049

Net Change In Fund Balances 2,280,023 (21,756) 1,204,284 598,451 (518,634)

Fund Balance, Beginning of Year 11,596,213 11,617,969 10,413,685 6,284,244 6,802,878

Fund Balance, End of Year 13,876,236$ 11,596,213$ 11,617,969$ 6,882,695$ 6,284,244$

(1) Excerpts from audited financial statements prepared by Sullivan, Rogers & Company, LLC.

June 30,

A-2

_________________________

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TOWN OF MASHPEE, MASSACHUSETTS

INDEPENDENT AUDITORS' REPORT ONBASIC FINANCIAL STATEMENTS AND

REQUIRED SUPPLEMENTARY INFORMATION

FOR THE FISCAL YEAR ENDED JUNE 30,2013

TOWN OF MASHPEE, MASSACHUSETTS

INDEPENDENT AUDITORS' REPORT ONBASIC FINANCIAL STATEMENTS AND

REQUIRED SUPPLEMENTARY INFORMATION

FOR THE FTSCAL YEAR ENDED IUNE 30,2073

TABLE OF CONTENTS

Page

Governmental funds - balance sheet........... 18

Governmental funds - statement of revenues, expenditures and changes in fund balances .............19

Reconciliation of the governmental funds balance sheet total fund balances to the statement of net position ....20

Reconciliation of the statement of revenues, expendifures and changes in fund balances of governmental funds

Proprietary fund - statement of fund net position ....................22

Proprietary fund - statement of revenues, expenses and change in fund net position .......................23

Fiduciary funds - statement of fiduciary net position ................25

Fiduciary funds - statement of changes in fiduciary net position .................26

General fund - schedule of revenues, expenditures and change in fund balance - budget and actual.................56

Community preservation fund - schedule of revenues, expenditures and change in fund balance - budget and

Schedules of fnding progress (Association) . ......60

Schedule of employer contributions (Association) ........'........60

Indep endent Audit ors' Rep ort

C ertif ed Pu b li c Accoun tantr

SULLIVAN, ROGERS & COMPANY, LLCCorporate Place I, Suite 204 . 99 South Bedford Street

Burlington, Massachusets 0 1 803

P . 7 8l-229-5600 F . 7 8l-229-561 0 www.sullivan-rogers.com

Independent Auditors' Report

To the Honorable Board of SelectmenTown of Mashpee, Massachusetts

Report on the Financial Statements

We have audited the accompanying financial statements of the governmental activities, the business-typeactivities, each major fund, and the aggregate remaining fund information of the Town of Mashpee,Massachusetts, as of and for the year ended June 30, 2013, and the related notes to the financial statements, whichcollectively comprise the Town of Mashpee, MassachusetLs' basic financial statements as listed in the table ofcontents.

Mønøgement's Responsibility for the Einanciøl Stntements

Management is responsible for the preparation and fair presentation of these financial statements in accordancewith accounting principles generally accepted in the United States of America; this includes the design,implementatiorç and maintenance of internal control relevant to the preparation and fair presentation of financialstatements that are free from material misstatement, whether due to fraud or error.

Au dit o t/ s Re sp on sib ility

Our responsibility is to express opinions on these financial statements based on out audit. We conducted ouraudit in accordance with auditing standards generally accepted in the United States of America and the standardsapplicable to financial audits contained in Gotsernment Auditing Standørds, issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assuranceabout whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in thefinancial statements. The procedures selected depend on the auditor's judgmen! including the assessment of therisks of material misstatement of the financial statements, whether due to fraud or error. In making those riskassessments, the auditor considers internal control relevant to the entit¡/s preparation and fair presentation of thefinancial statements in order to design audit procedures that aïe appropïiate in the circumstances, but not for thepurpose of expressing an opinion on the effectiveness of the entit¡r's internal control. Accordingly, we express nosuch opinion. An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of significant accounting estimates made by management, as well as evaluating the overallpresentation of the financial statements.

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

Opinions

In our opinion, the financial statements referred to previously present fatrly, in all material respects, therespective financial position of the governmental activities, the business-type activities, each major fund, and theaggregate remaining fund information of the Town of Mashpee, Massachusetts, as of fune 30,2013 and therespective changes in financial position and, where applicable, cash flows thereof for the year then ended inaccordance with accounting principles generally accepted in the United States of America.

Other Møtterc

Re quire d Supplementøry Information

Accounting principles generally accepted in the United States of America require that the managemenfsdiscussion and analysis (located on pages 4 through 12) and general fund and community preservation fundbudgetary comparisons and certain pension and other postemployment benefits information (located on pages 55

through 63) be presented to supplement the basic financial statements. Such information, although not a part ofthe basic financial statements, is required by the Governmental Accounting Standards Board, who considers it tobe an essential part of financial reporting for placing the basic financial statements in an appropriate operationafeconomic, or historical context. We have applied certain limited procedures to the required supplementaryinformation in accordance with auditing standards generally accepted in the United States of America, whichconsisted of inquiries of management about the methods of preparing the information and comparing theinformation for consistency with managemenf s responses to our inquiries, the basic financial statements, andother knowledge we obtained during our audit of the basic financial statements. We do not express an opinion orprovide any assurance on the information because the limited procedures do not provide us with sufficientevidence to express an opinion or provide any assurance.

Other Reporting Required by Gooernment Auditing Støndørils

In accordance with Gouernment Auditing Standnrds, we have also issued our report dated January 6,201'4 on ourconsideration of the Town of Mashpee, Massachusetts' internal control over financial reporting and on our tests

of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters.The purpose of that report is to describe the scope of our testing of internal control over financial reporting andcompliance and the results of that testing, and not to provide an opinion on internal control over financialreporting or on compliance. That report is an integral part of an audit performed in accordance with Gooernment

Auditing Standørds in considering the Town of Mashpee, Massachusetts' internal control over financial reportingand compliance.

January 6,2014

Mønøgement' s Discussion ønd Anøly sis

4

Managemenf s Discussion and Analysis For the Fiscal Year Ended |une 30, 2013

As management of the Town of Mashpee, Massachusetts (Town), we offer readers of these financial statementsthis narrative overview and analysis of the Town's financial activities for the fiscal year ended |une 30, 2013.

Einancinl Highlights

position).

percent of total general fund revenues and transfers in.

issued during the fiscal year.

Ooeraieut of the Basic Einanciøl Støtements

This discussion and analysis is intended to serve as an introduction to thebøsic fnancial statements, which consistsof the following three components:

1. Government-wide financial statements2. Fund financial statements3. Notes to the basic financial statements.

This report also contains required supplementary information in addition to the basic financial statements.

Government-wide financial statements

The government-wide financial statements are designed to provide readers with a broad overview of the Town'sfinances, in a manner similar to a private-sector business.

The statement of net position presents information on all of the Town's non-fiduciary assets and liabilities, witltthe difference between the two reported as net position. Over time, increases or decreases in net position mayserve as a useful indicator of whether the financial position of the Town is improving or deteriorating.

The statement of activities presents information showing how the governmenf s net position changed during themost recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to thechange occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in thisstatement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes, earnedbut unused vacation leave, etc.).

Both of the government-wide financial statements distinguish functions of the Town that are principallysupported by taxes and intergovernmental revenues (gouernmentøl øctiuities) from other functions that areintended to recover all or a significant portion of their costs through user fees and charges (business-type actiuities).

Governmental activities include general government public safety, educatiorL public works, health and humanservices, culture and recreation and debt service (interest). Business-type activities include the kids kluboperation (nonmajor enterprise fund).

The government-wide financial statements can be found on pages 15-17 of this report.

Town of Møshpee, Møssøchusetts Re quire d Suppl ement ary Information

Management's Discussion and Analysis For the Fiscal Year Ended June 30, 2013

Fund financial statements

A fund is a grouping of related accounts that is used to maintain control over resources that have been segregatedfor specific activities or objectives. The Towrç like other state and local governments, uses fund accounting toensure and demonstrate compliance with finance-related legal requirements. All of the funds can be divided intothe following categories and are described below:

-1.. Governmental funds2. Proprietary funds3. Fiduciary funds

Governmental funds

Governmental funds are used to account for the same functions reported as governmental activities in thegovernment-wide financial statements. Flowever, unlike the government-wide financial statements,governmental funcls financial statements focus on near-term inflows and outflows of expendable resources, as

well as on balances of expendable resources available at the end of the fiscal year. Such information may be

useful in evaluating a governmenfs near-term financing requirements.

Because the focus of governmental funds is narrower than that of the government-wide financial statements, it isuseful to compare the i¡formation presented for governmental funds with similar information presented forgovernmental activities in the government-wide financial statements. By doing so, readers may betterunderstand the long-term effect of the governmenfs near-term financing decisions. Both the governmental fundsbalance sheet and the governmental funds statement of revenues, expenditures, and changes in fund balancesprovide a reconciliation to facilitate this comparison between governmental funds and governmental activities.

The Town maintains 427 tndividral governmental funds. Information is presented separately in thegovernmental funds balance sheet and in the governmental funds statement of revenues, expendifures, andchanges in fund balances for the general and community preservation (special revenue) funds, each of which are

considered to be major funds. Data from the other 425 governmental funds are combined into a single,a ggregated presentation tttle d n onm aj or goa er nme n t nl fu n ds.

The basic governrnental funds financial statements can be found on pages 18-21. of this report.

Proprietary funds

The Town maintains one type of proprietary fund.

Enterpise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The Town uses an enterprise fund to account for its kids klub operation, which isconsidered to be a nonmajor fund.

The basic proprietary funds financial statements can be found on pages 22-24 of this report.

Fiduciary funds

Fiduciary funds are used to account for resources held for the benefit of parties outside the government.Fiduciary funds are not reflected in the government-wide financial statements because the resources of thosefunds are not available to support the Town's programs. The accounting used for fiduciary funds is similar tothat used for the government-wide financial statements.

Toran of Møshpee, Møssøchusetts Requireil Supplementøry Information

Managemenf s Discussion and Analysis For the Fiscal Year Ended fune 30, 2013

Private-purpose trust funds and agency funds are reported and combined into a single, aggregate presentation inthe fiduciary fund financial statements under the captions "private purpose trust funds" and "agency funds",respectively.

The basic fiduciary funds financial statements can be found on pages 25-26 of this report.

Notes to the basic financial statements

The notes provide additional information that is essential to a full understanding of the data provided in thegovernment-wide and fund financial statements. The notes to the financial statements can be found on pages 27-

53 of this report.

Required supplementary inf ormation

In addition to the basic financial statements and accompanying notes, this report also presents certain requiredsupplementary information. Presented in this information are the budget comparisons for the general fund andcommunity preservation fund and certain pension and other postemployment benefits informatiorù which can befound on pages 55-63 of this report.

Goa ernment-Wiile Êinønciøl Anøly sis

The following tables present current and prior year data on the government-wide financial statements.

Toran of Møshpee, Møssøchusetts Re q uireil Supplement øry Informati on

Managemenf s Discussion and Analysis For the Fiscal Year Ended June 30, 2013

Net Position

As noted earlier, net position may serve over time as a useful indicator of a governmenf s financial position. TheTown's assets exceeded liabilities by 594,953,450 at the close of the fiscal year and are summartzed as follows:

Assets

Cu¡¡ent assets.. $

Noncu¡¡ent assets (excluding

capital assets)..

Capital assets (net). . . .

Total assets... ..

LiabilitiesCurrent liabilities

(excluding debt).......................Noncurrent liabilities

(excluding debt)......................,Current debt..............Noncurrent debt... . . ... ... ..

Total liabilities

G o u en u nø úal Actiztitie s

2013 2072

34,01,9,498 $ 30,602585 $

5,224,U5 6,063,201.

t12,327,070 1t0,274,382

151,57r,413 746,885,1.68

Busù æ s s -Ty p e Actia iti e s

20t3 2012 2073

155,743 115,759

773,665 $

47,478

73,749 $

42,O10

34,133,163

5,224,U5

rt2,368,548

151.,726,556

$ 30,681,334

6,063,201.

110,256,392

t47.000,927

3,489,367

20,455,134

5,779,409

24,744,730

3,857,604

23,207,2M

8,808,965

20,648,257

3,479,056

20,252,792

5,7L9,409

24,1.M,730

\1.,910

239,126

10,311

202,342

3,869,514

23,446,370

8,808,965

20,648,257

Net Position

Net investment in capital assets. .. ..... 86,864,661 83,268,308

Restrictecl.. . ... . 12,188,209 1],550,7UUnrestricted. .. . (4,003,52n $,529,911\

Totalnetposition.. ... -........... g 95,M9,343 S 93,289,181

56,522,070 53,595,987 251,036 212,653 56,773,1.06 53,808,640

4L,478 42,0L0 86,906,739 83,310,318

- 12,188,209 11,550,784

(137,371) (138,e04) (4,1.40,8e8) (1.,668,87s)

$ _(effi_ $ _a6,8eÐ_ $ e4,es3,4s0 $ e3,1e2,287

A portion of the Town s net position (986,906,139) reflects its net investment in capital assets (e.9., land, buildingsand improvements, machinery, vehicles and equipment infrastructure and construction in progress). These

capital assets are used to provide services to citizens; consequentþ these assets are not available for futurespending. Although the investment in its capital assets is reported net of related debt, it should be noted that theresources needed to repay this debt must be provided from other sources, since the capital assets themselvescannot be used to liquidate these liabilities.

An additional portion of the Town's net position ($12,188,209) represents resources that are subject to externalrestrictions on how they may be used.

The Town has no unrestricted net position available. Such resources have been consumed with the recognition ofother post retirement benefit liabilities.

Town of Møshpee, Møssøchusetts Require il Supplement øry Informøtion

Managemenf s Discussion and Analysis For the Fiscal Year Ended fune 30, 2013

Changes in Net Position

For the fiscal year ended June 30, 2013, the Town's total net position increased by fi1,761,,163, compared to adecrease of $818,066 in the prior fiscal year. These amounts are summarized as follows:

G o u e rnm¿ n t al Ac tizt i ti e s Bnsine ss-Ty pe Actio ítìe s Total

2013 2072 2073 2012

Revenues

Program Reuenues:

Charges for services.. . . . .. . .. . . . . . $

Operating grants and contributions

Capital grants and cont¡ibutions

Genernl Reaenues:

Real estate and property taxes..

Motor vehicle and other excise taxes.. . . . . ... . .

Penalties and interest on taxes

Payments in lieu of taxes...........

Community preservation surcharges ..... ....

Grants and contributions not restricted

to specific progranìs.........

Unrestricted investrnent income-. ..... -. - - - -

Expenses

General govemment.... ...........Public safety... .

Education.. . ... ..

Public works....

Health and human services. . . . .. .

Culture and recreation.. . ... ..

Debt service - interest... .. . ... .

Change in net position... ... . . . ...

Net position - beginning of year

Net position - end of year. . . ... . .. .

4,672400

7,458,762

2223,763

39,982,722

7,892,129

493,629

10,478

7,188,572

3,3-13,720

72,530

$ 1201,814 $

7,820,304

622,6U

37,548;t04

7,630,043

265,437

3,97'J.

7,120,20-l

3,777,763

202,880

411,292 $749

37r,071. $

792

5,0'23,692 fi7,458,911.

2223,763

5,572,885

7,820,496

622,6U

39,982,722 37,548,104

7,892,729 7,630,043

493,629 265,437

10,478 3,977

1,788,572 7,\20,207

3,313,720 3,171.,763

72,530 202,880

Total revenues.. 67,248,1,05 57,587,795 47L,M7 371,263 61.,659,546 57,958,458

Kids klub...... ..

5,043,163 4,272338

7\,406,3-t6 17,610,655

32,87+664 32,292,004

6,293,-138 6,127,439

7,0u,357 1.,729,427

7,674,395 -1,626,299

7,117,910 ]278,M7

5,043,763

\7,406,31.6

32,874,664

6,293,138

7,084,357

1.,67+395

7,177,9'10

410,440

59,898,383

41272,338

77,61.0,655

32,292,004

6,-127,439-t,729,427

7,626,299

7,278,M7

439,915410,40

Total expenses.. 59,487,943 58,336,609 410,440

439,975

439,975

(68,6s2)

58,776,524

7,760,762

93,289,787

g 95,049,343

(74e,414)

94,038,595

1,001 7,76\,763 (81&066)

(e6,8e4) (28,242) 93,792,287 94,070,353

(es,8e3) S (96,894)s 94,953,450 I 93,L92,2875 93,289,1,81 $

Governmental activities increased the Town's net position by fi1,,760,1,62. In the prior year, governmentalactivities decreased the Town's net position by fi749,414. The key element of this change is an increase in capitalgrants and contributions of approximately $1,600,000, primarily related to state grants for infrastrucfureimprovements.

Business-type activities increased the Town's net position by $1,001. In the prior year, business-type activitiesdecreased the Town's net position by fi68,652. The key element of this change is an increase in charges forservices of approximately $40,000, primarily related to an increase in tuition rates and enrollment.

Town of Mashpee, Massachusetts Re quire il Supplemmt øry Informøtion

Management's Discussion and Analysis For the Fiscal Year Ended June 30, 2013

Eund Financial Støtement AnøIysis

As noted earlier, the Town uses fund accounting to ensure and demonstrate compliance with finance-related legalrequirements.

Governmental funds

The focus of the governmental funds is to provide fuformation on near-term inflows, ouflows, and balances ofexpendable resources. Such information is useful in assessing the Town's financing requirements.

At the end of the current fiscal year, the governmental funds reported combined ending fund balances totalingfi22,823,471., an increase of fi772,270 in comparison with the prior year. $6,381,348 represents unassigned fundbalance. The remainder of fund balance includes the following constraints:

The general fund is the chief operating fund of the Town. At the end of the current fiscal year, unassigned fundbalance of the general fund totaled g'1.0,280,566, while total fund balance was $13,876,236. As a measure of thegeneral fund's liquidity, it may be useful to compare both unassigned fund balance and total fund balance to totalgeneral fund revenues and transfers in. Unassigned fund balance represents 18.4o/o of total general fund revenuesand transfers in, while total fund balance represents 24.9% of that same amount.

The balance of the Town's general fund increased $2,280,023 during the current fiscal year. The Town recognizedan approximate$4,736,000 budgetary surplus (excluding encumbrances and continuing appropriations) andapproximately fi3,276,000 of reserves was utilized for spending during fiscal year 2013.

Financial highlights of the Town's other major governmental fund is as follows:

The fund balance of the communit¡r preservation fund (special revenue) increased by $389,880 during the currentfiscal year. The fund recognized fi1,197,227 in surcharges, $331,551. in intergovernmental revenues and aninvestment loss of 915,425. Expenditures of $193,338 were incurred during the fiscal year. The fund also madeS930,135 of transfers to the general fund during the fiscal year to fund debt service costs.

Proprietary funds

The Towfs proprietary fund provides the same type of information found in the government-wide financialstatements, but in more detail.

Unrestricted net position of the kids klub enterprise fund at the end of the year amounted to a deficit of $137,371.The kids klub enterprise fund had an increase in net position for the year of $1,001. Other factors concerning thefinances of the fund have already been addressed in the discussion of the Town's business-type activities.

Toutn of Møshpee, Møssøchusetts 10 Required Supplementøry Informøtion

Managemenls Discussion and Analysis For the Fiscal Year Ended June 30, 2013

General Fund Budgetary Highlights

The original general fund budgetof fi52,245,476 was increased by fiM7,267 (0.9%) during the fiscal year. Thefollowing table summarizes the increase:

Purpose of Increase Amount Funding Source

School operating budget.............. $

Assessor's revaluationWaterways.Miscellaneous..............Fire and rescue departments........

Unassigned fund balanceUnassigned fund balanceTransfer from waterways improvement special revenue fundUnassigned fund balanceTransfer from a¡nbulance receipts special revenue fund

2012 2013

336,000

80,000

17,4191.0,192

3,656

Totalincrease............................. $ M7,267

During the fiscal year, revenues exceeded budgetary estimates, while expenditures and encumbrances andcontinuing appropriations were less than budgetary estimates, resulting in a positive budget to actual variance offi3,717,76'1.. Encumbrances and continuing appropriations totaled 9L,017,963 atyear-end.

Cøpital Asset ønd Debt Ailministrøtion

Capital assets

The Town's investment in capital assefs at the end of the fiscal year totaled 9112,368,548 (net of accumulateddepreciation). This investment in capital assets includes land, buildings and improvements, machinery, vehiclesand equipment, infrastructure and construction in progress. The total increase in the investment in capital assets

for the current fiscal year totaled 1,.9% .

Major capital asset events that occurred during the current fiscal year include the following:

The following table summarizes the Town's capital assets (net of accumulated depreciation):

GouemmentølActioities Business-TypeActiaities TotøI

2013 2012 2013 201,2

Land.............Buildings and improvements..............Machinery, vehicles and equipment.....Infraskrucfu¡e.Construction in progtess. . ..

Total capital assets. . .. . .. . .. . .

$ s8,1s2590 $4'1,;t61,,336

1,sso9898,822;t902,634,965

58,192,253 $42,978,242

1,,1,57;t 65

7,184,259702,463

-$4L,478

-$42,01,0

58,157,590 $4'1,,202,81,4

1,,550,989

8,822,1,90

2,634,965

58,192,25343,020,252

1,,L57,165

7,184,259702,463

$ 11.2,327,070 $ 11.0,21.4,382 $ 41.,478 $ 42,070 5 112,368,548 g 110,256,392

Additional information on the Town's capital assets can be found in Note 5 on pages 40-41, of this report.

Town of Mashpee, Møssøchusetts 11 Requireil Supplementøry Informøtion

Managemenf s Discussion and Analysis For the Fiscal Year Ended June 30, 20L3

Long-Term Debt

At the end of the current fiscal year, total bonded debt (gross) outstanding was 524,205,172, whichis backed bythe full faith and credit of the Town, and is summarized as follows:

G o a ernm ent al A ct ia iti e s

2013 2012

General obligation bonds.............. g 23,275,000 g 26,715,000MWPAT notes......... 930,172 1,011,535

Total bonds and notes... g 24,205,172 fi 27,726,535

The Town s gross bonded debt decreased by fi3,52'1.,363 during the fiscal year.

The Town s bond rating from Standard & Poor's for the November 2010 bond issue was AA+.

Additional information on the Town's long-term debt can be found in N.ote 9 on pages 44-45 of this report.

Reque sts for Informati on

This financial report is designed to provide a general overview of the Town's finances for all those with aninterest in its finances. Questions concernin g any of the information provided in this report or requests foradditional financial information should be addressed to the Town Accountan! Town Hal7,-J,6 Great Neck RoadNorth, Mashpee, Massachusetts 02649.

Toutn of Møshpee, Møssøchusetts 12 Require d Supplement øry Information

This page left intentionally blank.

13

B øsic Finønciøl St øtements

'1.4

STATEMENT OF NET POSITION

IUNE 30, 2013

Prima Government

Governmental Business-type

Activities Activities TotaìASSETSCurrent assets:

Cash and cashequivalents. .. .. . .. . . $ResF¡cted cash and cash equivalents....Investments.. ... ,. .. .

Restrictedinvesknenb .. . ..R<eivables, net of allowance for uncollætibìe amounts:

Real estate and personal property taxes,........ ..Tax and trash liensMotor vehicle and othe¡ excise taxes.Commu nity preservation surcharges..Spæial assessmenbDepdrhnent¿l and olher.. . .. ..Intergovemmental.Loans.,...............,

Tohal current assets

Noncurent assets:

R(eivables, net of allowance for uncolltrbble amounts:Real estate lax deferals. ....Spæial assessmenbIntergovernmental.Loans . .

Tax for<losures...,Capital asseb not being depr(iated.....Capitat assets, net of accumulatecl depr€iation....,......... ..

11,643,270 $8,315,4553,9U,1,665,758,470

667,U71,,013,582

328,52'l44,643

189,078238,794

7,866,57479,758

108,420 $5,245

17,751,6908,320,7003,934,7665,758,470

667,U71,013,582

328,521M,643

'189,078

238,7947,866,514

19,758

34,733,1,63

27,0927,665,2U

z6n,74s768,425686,349

60,792,55551,575,993

717,593,393

757,726,556

713,665

41,478

4't,478

155,143

Total noncu¡¡ent assets...

u,019,498

27,0E27,665,2342,677,745

768,425686,349

60,79255551,534,515

717,551,915

157,577,4t3

995,U91,780,022

356,454

356,898115,104

11000238,277

5,303,6603,505,305

LIABILITIESCurent liabilities:

Warrants payable.Accrued payrollOtier liabilities. .

Unearned ¡evenue....,.....,....Accrued interest..Capital lease obligations...... .

La¡dfill closu¡e and post<losureCompensabed absences....... ...Sho¡t-tern notes payable.Long-Þrm bonds and notes payable

To[al current l¡dbilities..

Noncùrent liabilities:Capital lease obligations ................... . .

LandfilI closure and post<losureCompensaþd absences...,.,.,.....Net OPEB obligationLong-berm bonds and notes payable

Total noncuÍent liôbilities . .

Total liabilities

NET POSITIONNet inveshrent in capital assets.

Restricted for:Community preservation... . .

LoansoPEB..................Pemanent funds:

Expendable..........Nonexpendable

Other spcific purposes. .. . .

Uüesticted......,.,

Total net position.

See notes to basic financial statements.

^12,666,569 11,910 72678,479

6,685

q)1q

7,0025341,,780,022

356,4ilE"q

356,8981151041t000

238,2n5,303,6603,505,30s

35,O27

427,0792"1M,489

20,600,649 239,12620,648,257

86,864,667

6,306,47"1

188,183270,372

24,59545,O52

5351s36(4,003,52n

s 95,O49,U3

41,478

(137,377)

I (es,8e3)

35,027

427,0792,7M,489

20,839,n520,648,257

56,773,106

86,906,739

6,306,471

188,183270,372

24,59545,052

5,353,536(4140,898)

6 94,953,450

43,855,50^1 239,126 44,094,627

56,522,070 257,036

Touu of Mtshpee, Mnssflclußetts Bnsic Fi,n aifl, Stntøtøtts

STATEMENT OF ACTIVITIES

FOR T}IE FISCAL YEAR ENDED IUNE 30 2013

Program Revenues

Charges forServices

OperatingGrants and

CapitalGrants and

Net(Expense)/RevenueContributions ContributionsFunctions/Prog¡ans

Primary governrnenhGovemmental activities:

General governnent. .. .

Public safety...Education......Public works..Health a¡d human services. .. . . . .. . . .

Culture and recreationDebt service - interest........

Expenses

5,043,16317,406,316

32,874,6646,293,138

7,084,357

1,,674,395

1,111,910

708,318

r,423,787742,681.

1,,770,871,

734,320

492,423

75,771,

74,747

6,768,948

172,305

96,18-I

86,035

245,M1,

331,551

1,892,212

fi (3,927,583)

(9,908,388)

Qs,363,035)(3,177,750)

(8s3,8s6)

(1,0e5,%n(866,46e)

(45,193,078)Total govemmental activities...,

Business-type activities:Kids k1ub.......

Total primary government....

59,487,943 4,672,400 7,458,762 2,223,763

4t0,M0

59,898,383 $

471,,292

5,023,692 g 7,458,97'1.

749 1,001

2,223,763 s (45,192,017)

(continued)

Toun of Møshpee, Møssachusetts 1,6 B asic Finøncial S tatements

STATEMENT OF ACTMTIES (Continued)

FOR THE FISCAL YEAR ENDED JUNE 30, 2013

Primary Government

GovernmentalActivities

Business-typeActivities Total

Changes in net position:Net (expense)/revenue (from previous page)... .... . .... . .

General reoenues:

Real estate and personal property taxes.Motor vehicle and other excise taxes..Penalties and interest on taxes......Payments in lieu of taxes.......Community preservation surcharges...Grants and contributions not restricted tospecific programs....

Unrestricted investment income.......

Total general revenues...

Change in net position...............

Net position - beginning of year........

Net position - end of year

See notes to basic financial statements.

$ (45,1%,018) $ 1,001

39,982,1,22

1.,892,129

493,629

10,478

1.,1.88,572

3,313,72072,530

$ (45,192,01n

39,982,122

1,892,129

493,629

10,4781.,1.88,572

3,313,72072,530

46,953,180 46,953,180

't,760,162

93,289,'1.8-t

1,001

(96,894)

$ (95,893)

1,761,,"163

93;t92,287

95,049,343 94,953,450

(concluded)

Town of Mashpee, Massøchusetts 77 B øsic Financiøl St øtetnmts

GOVERNMENTALFUNDSBALANCESFIEET

JUNE 30 2013

GeneralCommunityPreservation

Nonmajor TotalGovemmental Governmental

Funds FundsASSETS

Cash and cash equivalents.... . ..... . .. .. . .. .......... . . ..... .. . ... $Investments...Receivables, net of allowance for uncollectible amounts:

Real estate and personal property taxes. . ... ..... .. ... . . ..Real estate tax deferrals...Tax and trash liens. . ...

LIABILITIES:Warrantspayable................. ............ $Accrued payroll.........Other liabilities.. . .. ... .. .. . -....Deferred revenue.. .. .. ..

Restricted..... .

Comrritted....Assigned.......Unassigned...

TOTAL FUND BALANCES...,..,.,..

11.,643,270 $ - $3,934,1,66

667,847

27,0921,,00-1,326 12,256

L,854,3L2238,194

1,065,805

188,183

7,269,648

11,643,270

3,934,166

667,847

27,0921.,013,582

328,527M,643

1,854,31,2

238,-t94

4,5M,259188,183

686,349

8,315,455

5,758,470

Motor vehicle and other excise tâxes.. ... . .. . 328,527Com-rnunity preservation surcharges... ... ... - 44,643Special assessments...Deparbnental and other......Intergovernmental............. 3,478,454

Restricted assets:

Cash and cash equivalents... .. ..... .. ... ..Investments...

TOTALASSETS............... .................... $ 22,309,474 $

LIABILITIES AND FUND BALANCES

6,306,471. $ t0,628,398 $ 39,2M,343

279,625 766,182262,824 5,495,646

Short-term notes payable.

TOTAL LIABILITIES.......... 8,433,238 44,643

FUND BALANCES:Nonspendable

461.,280 $ -1,,780,022

356,4545,835,482 44,643

$ 534,569

2,104,762

5,303,660

7,942,991,

$ 995,849

1,780,022

356,4547,984,887

5,303,660

16,420,872

542,M9 6,261,828233,235

6,351,,390

(3,8ee,21,8)

2,685,407

233,235t3;155,6672,782;t61,

27L,0606,381.,348

2,782,161,

27"1,060

1,0,280,566

13,876,236

22,309,474 $

6,261,,828 22,823,471

6,306,471. $ 10,628,398 $ 39,2M,343TOTAL LIABILITIES AND FUND BALANCES.,. $

See notes to basic financial statements.

Tou.tn of Mashpee, Massachusetts 18 B ø s i c F in øn ci al S t øt em eflt s

GOVERNMENTALzuNDSSTATEMENT OF REVENUES, EXPENDITURES AND CHANGES INFUND BALANCES

FOR THE FISCAL YEAR ENDED IUNE 30, 2013

Gene¡alCommunityPreservation

Nonmajor TotalGovernmental Govemmental

Funds FundsREVENUES

Realestateandpersonalpropertytaxes... ............ $Moto¡ vehicle and other excise taxes...........Tax and trash liens.......Payments in lieu of taxes.Community preservation surcharges...........Charges for services. . ............Trash disposalIntergovernmental .. ...Special assessments,

Penalties and interest on taxesLicenses and permits....Fines and forfeitures.............Departmental and other.. .......

39,977,702 g

1,846,734

473,965

70,478

219,720

690,2079,097,332

1.,197,227

331,551

7,791.,878

4,078,972

385,5293,900

1.8,983

850,141

186,798

931.

39,971,7027,846,134

4r3,9651.0,478

1,197,227

2,077,538

690,20773,507,855

385,529497,529487,784

69,367

1.,030,173

786,798

52,340

493,629

468,801

69,367180,032

Contributions.Inveslment income (loss).......

TOTALREVENUES.

EXPENDITURESCurrent:

Gene¡al government.. . .

Public safety.. .

Education. .. .. . .

Public works...Health and human services ..................Culture and recreation. .. . . . .

Pension benefits................. -

Employee benefits.......Property and liability insurance.... ...

State and county charges. . .. .. . . . .

Debt service:Principal.....Interest..

TOTAL EXPENDITURES.......

EXCESS (DEFICIENCÐ OF REVENUESOVER EXPENDITURES..... -....

oTHER FTNANCTNG SOURCES (USES)Transfers in....T¡ansfers out................

TOTAL OTHER FTNANCTNG SOURCES (USES). . . . .

53,528,201

(75,42s)

1,513,353

193,338

7,377,072 62,358,626

66,834

2,677,281

7,589,96119,897;185

4,840,256

630,403

687,4244,767,762

5,623,348470,822

1,608,755

3,527,3637,1.63,353

53,405,913

'122,288

760,547

831,0702,562,073

3,926,48049,2M

457,757

3,565,1.60

8,421,03722,453,',258

8,766,736

679,6477,745,1814,767,762

5,623,348470,822

1.,608,755

3,521.,363

1.,-1.63,353

8,587,16s

7,320,015 (1,,270,093)

62,786,41,6

389,880

5,871,,948

772,270

60000 2,277,735(7,287,600) Q,277,73s)

(1,,227,600)

(2,497,693)

5,183,100

172,210

22,651,261,

NET CHANGE IN FUND BALANCES.. 2,280,023

77,596,213FUND BALANCES AT BEGINMNG OF \GAR.,.........,........

FLJND BALANCES AT END OF YEAR.......... . ............... ... $ 13,876,236

See notes to basic financial statements.

2,685,407 $ 22,823,471

Town of Mashpee, Mnssøchusetts

6,261,,828 $

B a s i c F in an ci aI S t at en ent s

RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET

TOTAL FUND BALANCES TO THE STATEMENT OF NET POSTTION

Total govemmental fund balances (page 18).....'

Capital assets (net of accumulated depreciation) used in governmental activities are not

financial resources and, therefore, are not reported in the govemmental funds.. .. ' . . ' .

Other assets are not available to pay for current period expenditures and,

therefore, are deferred in the governmental funds.. '

In the statement of net position, interest is accrued on outstanding long-term deb¿

whereas in the governmental funds interest is notreported until due ''"'''"'''

Long-term liabilities are not due and payable in the current period and,

therefore, are not rePorted in the governmental funds.

Bonds and notes payable, net of unam ortized premiums and deferred losses on refundings. ' . . . . .

Capital lease obligations.....'......'.Landfill closure and post-closure...'.... ...'.Compensated absences......Net OPEB obligation

Net position of govemmental activities (page 15). .. ... "..

See notes to basic financial statements'

22,823,471.

112,327,070

7,984,887

(356,898)

(24,153,562)(1s0,131)

(M2,079)(2,382,766)

(20,600,&9)

$ 95,049,343

Towr of Møshpee, Møssøchusetts 20 B asic F ùnt rciøl St øtements

RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES ANDCHANGES IN FUND BALANCES OF GOVERNMENTAL zuNDS

TO THE STATEMENT OF ACTTVITIES

FOR THE FISCAL YEAR ENDED IUTVS 30,2013

Net change in fund balances - total governmental funds þage 19).. . . ..

Governmental funds report capital outlays as expenditures. However, in the statement ofactivities the cost of those assets is allocated over their estimated useful lives andreported as depreciation expense. These amounts represent the related activityof the curent period.

Capital outlays.................Depreciation.

172,210

4,938,124

(2,726,939)

3,521,363126,396

(147,041)(10s,1ee)

115,466

In the statement of activities, the loss on the disposal of capital assets is reported,whereas in the governmental funds the disposal of capital assets is not reported asfinancial resources. As a result, the change in net position differs from the change infund balance by the net book value of capital assets disposed.................

Revenues in the statement of activities that do not provide current financial resourcesare fully deferred in tlre statement of revenues, expenditures and changes in fundbalances. Therefore, the recognition of revenue for various types of accounts receivable(i.e., real estate and personal property, motor vehicle excise, etc.) differ between thetwo statements. This amount represents the net change in deferred revenue.......

The issuance of long-term debt (e.g., bonds and leases) provides current financial resourcesto govemmental funds, while the repayment of the principal of long-term debt consumesthe financial resources of governmental funds. Neither transactiory however, has anyimpact on net position. AIso, governmental fu¡ds report the effect of issuance costs,premiums, discounts, and similar items when debt is first issued, whereas these amountsare deferred and amort2ed in the statement of activities. These amounts represent the

(98,497)

(1.,110,520)

related activity of the current period.Bond maturities.................Amortization of bond premiumsAmortization of deferred losses on refundings....Capital lease proceeds......Capital lease maturities

In the statement of activities, interest is accrued on outstanding long-term debt,whereas in the governmental funds interest is not reported until due. This amountrepresents the net change in accrued interest payable 72,088

Some expenses reported in the statement activities do not require the use of currentfinancial resources and, therefore, are not reported in the governmental funds.These amounts represent ttre net changes:

Landfill postclosure 12,30041,960

(3,057,54e)

Comperuated absences

NetOPEB obligation

Changes in net position of governmental activities (page17)...... g 1.,760,1.62

See notes to basic financial statements.

Town of Mashpee, Massachusetts 27 B a sic Fhnrciøl St øtements

PROPRIETARY FUNDSTATEMENT OF FUND NET POSITION

JUNE 30,2073

ASSETS

Current assets:

Cash and cash equivalents..........Restricted cash and cash equivalents...

Total current assets..

Noncurrent assets:

Capital assets, net of accumulated depreciation.

Total assets

LIABILITIESCurrent liabilities:

Warrants payable..Unearned revenue..

Total current liabilities.

Noncurrent liabilities :

Net OPEB obligation...

Total liabilities......

FUND NET POSITION (DEFICIT)Net investment in capital assets...

Unrestricted

Total fund net position (deficit)..

See notes to basic financial statements.

Business-TypeActivities -

Enterprise Fund

Kids Klub(nonmajor)

'1.08,420

5,245

113,665

4'1,,478

155,L43

6,685

5,225

11,,910

239,126

251.,036

41,478

(137,371)

(95,893)

Town of Møshpee, Møssøchusetts 22 B a si c E in øn cial St øtement s

PROPRIETARY FUNDSTATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION

FOR THE FISCAL YEAR ENDED IUNE 30,2013

OPERATING REVENUESCharges for services

OPERATING EXPENSES

Cost of service and administration.Repairs and maintenance...Depreciation

TOTAL OPERATING EXPENSES.........

OPERATING INCOME.

NONOPERATING REVENUESInvestment income..

CHANGE IN NET POSITION

FUND NET DEFICIT AT BEGINNING OF YEAR

FUND NET DEFICIT AT END OF YEAR... $

See notes to basic financial statements.

Business-TypeActivities -

Enterprise Fund

Kids Klub(nonmajor)

411,292

404,0485,860

532

410,440

852

149

1,001

(96,894)

(95,893\

Tornn of Møshpee, Møssøchusetts 23 B øsic E inøncial Støtements

PROPRIETARY FUNDSTATEMENT OF CASH FLOWS

FOR THE FISCAL YEAR ENDED JUNE 30,2013

CASH FLOWS FROM OPERATING ACTIVITIES

Receipts from customers and users.

Payments to vendors.Payments to employees..........

NET CASH FROM OPERATING ACTTVITIES....

CASH FLOWS FROM INVESTING ACTIVITIESInvestment income.

NET CHANGE IN CASH AND CASH EQUIVALENTS....

CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR(includes $13,545 reported as restricted cash and cash equivalents)..

CASH AND CASH EQUIVALENTS AT END OF YEAR(includes fi5,245 reported as restricted cash and cash equivalents).

RECONCTLTATION OF OPERATING INCOME (LOSS) TO NET CASHFROM OPERATING ACTIVITIES

Operating income (loss)..Adjustments to reconcile operating income (loss) to net

cash from operating activities:OPEB obligation.....Depreciation..........Effect of changes in operating assets and liabilities:

Warrants payable.Unearned revenue...

Total adjustments....

NET CASH FROM OPERATING ACTIVITIES.........

See notes to basic financial statements.

Business-TypeActivities -

Enterprise Fund

Kids Klub(nonmajor)

$ 408,850

(74,838)(294,245)

39,767

1,49

39,916

73,749

113,665

852

36,784532

, 4,041,

(2,442)

38,915

39,767

Town of Møshpee, Møssøchusetts 24 B øsi c Einønciøl Statements

FIDUCIARY FUNDSSTATEMENT OF FIDUCIARY NET POSITION

IUNE 30,2013

PrivatePurpose Agency

TrustFunds FundsASSETS

Cash and cash equivalents.......... $ 6,259 g 771.,772

LIABILITIESWarrants payable...... 5,556

Liabilities due depositors............ - 766,216

Total liabilities............ - 77L,772

NET POSITIONAssets held in trust for other purposes............ fi 6,259 $ -

See notes to basic financial statements.

Town of Møshpee, Møssøchusetts 25 B ø si c Einønci øl St at emmt s

FIDUCIARY zuNDSSTATEMENT OF CHANGES IN FIDUCIARY NET POSITION

FOR THE FISCAL YEAR ENDED JUNE 30, 2013

PrivatePurpose

Trust FundsADDITIONSNet investment income:

Interest...... fi 2

DEDUCTIONSOther........ 25

CHANGE rN NET POSrrrON. (23)

NET POSITION AT BEGINNING OF YEAR 6,782

NET POSITION AT END OF YEAR........ fi 6,759

See notes to basic financial statements.

Toatn of Mashpee, Mnssøchusetts 26 B a si c E inanci øl St atemmts

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

NOTE 1- - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. General

The basic financial statements have been prepared in accordance with accounting principles generally accepted inthe United States of America (GAAP). The Governmental Accounting Standards Board (GASB) is the standard-setting body for establishing governmental accounting and financial reporting principles. The significantaccounting policies are described herein.

B. RepofüngEntity

The Town of Mashpee, Massachusetts (Town) is a municipal corporation that is governed by an elected Board ofSelectmen.

For financial reporting purposes, the basic financial statements include all funds, organizations, account groups/agencies, boards, commissions and institutions that are not legally separate from the Town.

The Town has also considered all potential component units for which it is financially accountable as well as

other organizations for which the nature andf or significance of their relationship with the Town are such thatexclusion would cause the Town's basic financial statenents to be misleading or incomplete. It has beendetermined that there are no component units that require inclusion in the basic financial statements.

Ioint Ventures

A joint venfure is an organizatton (resulting from a contracfual arrangement) that is owned, operated or governedby two or more participants as a separate and specific activity subject to joint control in which the participantsretain an ongoing financial interest or ongoing financial responsibility. Joint control means that no singleparticipant has the ability to unilaterally control the financial or operating policies of the joint venture.

The Town participates in one joint venture with other municipalities to pool resources and share the costs, risksand rewards of providing goods and services to venture participants directly, or for the benefit of the generalpublic or specified recipients. The following table identifies the Town s joint venture and related information:

Fiscal Year2013

AssessmentName

Cape Cod RegionalTechnical High School

Purpose Address

To provide vocational 351 Pleasant Lake Avenueeducational services Harwich, MA02645 $ 969,173

The Cape Cod Regional Technical High School (School) is governed by a2l member school committee consistingof two representatives (appointed by the Board of Selectmen) from the Town. The Town is indirectþ liable forthe Schools debt and other expenditures and is assessed annually for its share of operating and capital costs.

Separate financial statements may be obtained by writing to the Treasurer of the School at the address identifiedabove.

Town of Møshpee, Møssøchusetts 27 B a si c E inøncial S t øtement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

C. Implementation of Neu Accounting Principles

For the year ending ]une 30, 2013, the Town implemented the following pronouncements issued by the GASB:

. GASB Statement No. 60, Accounting and Finønciøl Reporting for Seraice Concession Arrøngements

. GASB Statement No. 61, The Finqncial Reporting Entity: Omnibus - an amendment of GASB StatementsNo.1.4 nndNo. 34

. GASB Statement No. 62, Codification of Accounting ønd Finøncial Reporting Guidance Contained in Pre-Nooember 30, L989 FASB and AICPA Pronouncements

¡ GASB Statement No. 63, Financial Reporting of Deþned Outflows of Resources, Deferred Infloras ofResources, and Net Position

GASB Statement No. 63 identifies net position as the residual of all other elements presented in a statement offinancial position, which amends the net asset reporting requirements of Statement No. 34, Basic FinønciølStatements - ønd Mønagement's Discussion and Annlysis - for State and Local Goaernments, and otherpronouncements, by renaming net assets to net position.

The implementation of GASB Statement No.'s 60, 61 and 62had no reporting impact for the Town.

D. Goaernment-Wiile ønd Fund Finønciøl Statements

Government-Wide Financial Statements

The government-wide financial statements (statement of net position and the statement activities) reportinformation on all non-fiduciary activities of the primary government. Goaernnæntal actitsities, which areprimarily supported by taxes and intergovernmental revenues, are reported separately frombusiness-typeactiaities, which are primarily supported by user fees.

Fund Financial Statements

Separate financial statements are provided for governmental funds, proprietary funds and fiduciary funds, eventhough fiduciary funds are excluded from the government-wide financial statements. Major individualgovernmental funds and major individual enterprise funds are reported as separate columns in the fund financialstatements. Nonmajor funds are aggregated and displayed in a single column. Fiduciary funds are reported byfund type.

E. Measurement Focus, Basis of Accounting ønd Basis of Presentøtion

Government-Wide Financial Statements

The government-wide financial statements are reported using the economic resources measurement focus and theaccrual basis of accounting. Under this method, revenues are recorded when earned and expenses are recordedwhen the liabilities are incurred. Real estate and personal property taxes are recognized as revenues in the fiscalyear for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibilityrequirements imposed by the provider have been met.

The statement of activities demonstrates the degree to which the direct expenses of a function or segment areoffset by program revenues. Direct expenses are those that are clearly identifiable with a specific function orsegment.

Tozan of Mashpee, Massachusetts 28 B a si c E inøncial St øt ement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

Program revenues include the following:

privileges provided by a given function or segment.

or segment.

segment.

Taxes and other items not identiÉiable as program revenues are reported as general revenues.

Except for charges between the general fund and enterprise fund, the effect of interfund activity has beeneliminated from the government-wide financial statements. Elimination of these charges would distort the directcosts and program revenues reported for the functions affected.

Fund Financial Statements

Governmental funds financial statements are reported using the flow of current financial resources measurementfocus and the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues arerecognized when susceptible to accrual (i.e., measurable and available). Measurable means the amount of thetransaction can be determined and available means collectible within the current period or soon enoughthereafter to pay liabilities of the current period. Expenditures are recorded when the related fund liability isincurred, except for unmatured interest on general long-term debt which is recognized when due, and certaincompensated absences and landfill closure costs which are recognized when the obligations are expected to beliquidated with current expendable available resources.

Real estate and personal property tax revenues are considered available if they are collected within 60-days afterthe end of the fiscal year. Investment income is susceptible to accrual. Other receipts and tax revenues becomemeasurable and available when the cash is received and are recognized as revenue at that time.

Entitlements and shared revenues are recorded at the time of receipt or earlier if the susceptible to accrual criteriais met. Expenditure driven grants recognize revenue when the qualifying expenditures are incurred and all othergrant requirements are met.

The following major governmental funds are reported:

The general fund is rsed to account for and report all financial resources not accounted for and reported in anotherfund.

The community preseruøtion fund is a special revenue fund used to account for the 3o/o local real estate tax surchargeon nonexempt property (and matching state trust fund distribution) that can be used for open space/ historicresource and affordable housing purposes. Property exempt from the surcharge consists of the first $100,000 ofall residential property and also property owned by low income or seniors with a low or moderate income as

defined by Massachusetts Department of Revenue (DOR) guidelines. Disbursements from this fund mustoriginate from the Community Preservation Committee and be approved by Town Meeting.

The nonmajor governmental funds consist of other special revenue, capital projects and permanent funds that areaggregated and presented in the nonmøjor goaernmental funds column on the governmental funds financialstatements. The following describes the general use of these fund types:

Town of Mashpee, Massachusetts 29 B ø sic EinønciøI Statements

Notes to Basic Financial Statements For the Fiscal Year Ended fune 30, 2013

Special reuenue funds are used to account for and report the proceeds of specific revenue sources that are restrictedor committed to expenditure for specified purposes other than debt service or capital projects.

Capital projects funds are used to account for and report financial resources that are restricted, committed, orassigned to expenditure for capital outlays, including the acquisition or construction of capital facilities and othercapital assets. Capital projects funds exclude those types of capital-related outflows financed by proprietaryfunds or for assets that will be held in trust for individuals, private organizations, or other governments.

Permanent funds are used to account for and report resources that are restricted to the extent that only earnings,and not principal, may be used for purposes that support the government's programs and benefit the governmentor its citizenry.

Proprietary funds financial statements are reported using the flow of economic resources measurement focus anduse the accrual basis of accounting, whereby revenues are recorded when earned and expenses are recordedwhen the liabilities are incurred.

Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenuesand expenses generally result from providing services and producing and delivering goods in connections withthe proprietary funds principal ongoing operations. All revenues and expenses not meeting this definition arereported as nonoperating revenues and expenses.

The following nonmajor proprietary fund is reported:

The kids klub fund is used to account for the toddler and pre-school activities of the leisure services department.

Fiduciary funds financial statements are reported using the flow of economic resources measurement focus anduse the accrual basis of accounting. Fiduciary funds are used to account for assets held in a trustee capacity forothers that cannot be used to support the government's programs.

The following fiduciary fund types are reported:

Tlae priaate-purpose trust fund is used to account for various scholarship and welfare funds, other than thoseproperly reported in the permanent fund, under which principal and investment income exclusively benefitsindividuals, private organizations, or other governments.

The ngency fimd is used to account for assets held in a custodial capacity. Such assets consist mainly of planningboard and other escrow deposits. Agency funds do not present the results of operations or have a measurementfocus.

F. Deposits ønd Inaestments

Government-Wide and Fund Financial Statements

Cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments withan original maturity of three months or less from the date of acquisition.

Investments are carried at fair value.

Town of Mashpee, Møssøchusetts 30 B ø si c E inanci al St øt ement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

G. Accounts Receiaøble

Government-Wide and Fund Financial Statements

The recognition of revenue related to accounts receivable reported in the government-wide financial statementsand governmental funds financial statements are reported under the accrual basis of accounting and the modifiedaccrual basis of accounting, respectively.

Real Estate Taxes, Personal Property Taxes and Tax Liens

Real estate and personal property taxes are levied and based on values assessed on fanuary 1't of every year.Assessed values are established by the Board of Assessor's for 100% of the estimated fair market value. Taxes aredue on November 1't, February 1't, May 1"t and August 1't and are subject to penalties and interest if they are notpaid by the respective due date. Real estate and personal property taxes levied are recorded as receivables in thefiscal year of the levy.

Real estate tax liens are processed approximately six months after the close of the valuation year on delinquentproperties and are recorded as receivables in the fiscal year they are processed.

Motor Vehicle and Other Excise Taxes

Motor vehicle excise taxes are assessed annually for each vehicle registered in the Town and are recorded as

receivables in the fiscal year of the levy. The Commonwealth is responsible for reporting the number of vehiclesregistered and the fair values of those vehicles to the Town. The tax calculation is the fair value of the vehiclemultiplied by $25 per $1,000 of value.

Community Preservation Surcharges

Community preservation surcharges are levied annually and at a rate of 3% of residents' real estate tax bills withexemptions for the first $100,000 of residential property and property owned by qualified persons with lowincome and seniors (60+) with low or moderate income as defined by DOR guidelines. The surcharges are duewith the real estate tax on August 1't, November 1't, February 1* and May l.'t and are subject to penalties andinterest if they are not paid by the respective due date. Overdue surcharges are included on the tax liensprocessed on delinquent real estate taxes. Surcharges are recorded as receivables in the fiscal year of the levy.

Special Assessments

Special assessments consist of street betterments and are recorded as receivables in the fiscal year accrued.

Departmental and Other

Departmental and other receivables represent amounts due from ambulance fees and other various departmentalactivities. These receivables are recorded when the service has been provided or the applicable agreement hasbeen entered into.

Intergovernmental

Various state and federal operating and capital grants are applied for and received annually. For non-expenditure driven grants, revenue is recognized as soon as all eligibility requirements imposed by the providerhave been met. For expenditure driven grants, revenue is recognized when the qualifying expenditures areincurred and all other grant requirements are met.

Town of Møshpee, Møssøchusetts 31 B asic E inønciøI Statements

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

Loans

The Town administers various loan programs to residents that provide assistance to comply with Title V (relatedto septic systems) requirements. Loans are recorded as receivables upon issuance.

H. Allozuønce for Uncollectible Accounts

The allowance for uncollectible accounts is estimated based on historical trends and specific account analysis forthe following accounts receivable:

The following types of accounts receivable are secured via the lien process and are considered 100% collectible.Accordingly, an allowance for uncollectible accounts is not reported.

Intergovernmental receivables are considered 100 % collectible.

l. Inaentories

Government-Wide and Fund Financial Statements

Inventories are recorded as expenditures at the time of purchase. Such inventories are not material in total to thegovernment-wide and fund financial statements and therefore are not reported.

I. Restricted Assets

Government-Wide and Fund Financial Statements

Assets are reported as restricted when limitations on their use change the nature of the availability of the asset.

Such constraints are either externally imposed by creditors, contributors, grantors, or laws of other governments,or are imposed by law through constitutional provisions or enabling legislation.

K Cøpitøl Assets

Government-Wide and Proprietary Fund Financial Statements

Capital assets, which consist of land, construction in progress, buildings and improvements, machinery, vehiclesand equipment and infrastructure, are reported in the governmental activities column of the government-widefinancial statements.

Capital assets are recorded at historical cost or at estimated historical cost if actual historical cost is not available.Donated capital assets are recorded at the estimated fair market value at the date of donation. Constructionperiod interest is not capitalized on constructed capital assets.

All purchases and construction costs in excess of $10,000 are capitalized at the date of acquisition or constructiorLrespectively, with expected useful lives of greater than one year.

Town of Møshpee, Møssøchusetts 32 B ø si c E inønci øl St atement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

Capital assets (excluding land and construction-in-progress) are depreciated on a straightJine basis. Theestimated useful lives of capital assets are as follows:

Capital Asset Type

EstimatedUseful

Life(in years)

Buildings and improvements. 20-40Machinery,vehicles andequipment....... 3-15Infrastructure........ .. 40

The cost of normal maintenance and repairs that do not add to the value of the assets or materially extend assetlives are not capitalized and are treated as expenses when incurred. Improvements are capitalized.

Governmental Funds Financial Statements

Capital asset costs are recorded as expenditures in the acquiring fund in the fiscal year of the purchase.

L. Interfund Receiaøbles ønd Payables

During the course of its operations, transactions occur between and within funds that may result in amountsowed between fulds.

Government-Wide Financial Statements

Transactions oÍ abuyerf seller nature between and within governmental funds are eliminated from thegovernmental activities in the statement of net position. Any residual balances outstanding between thegovernmental activities and business-type activities are reported in the statement of net position as "internalbalances".

Fund Financial Statements

Transactions of a buyer/seller nature between and within funds are not eliminated from the individual fundstatements. Receivables and payables resulting from these transactions are classified as "Due from other funds"or "Due to other funds" on the balance sheet. As of June 30,2013, there were no amounts due to or from otherfunds.

M. InterfundTrønsfers

During the course of its operations, resources are permanently reallocated between and within funds.

Government-Wide Financial Statements

Transfers between governmental funds are eliminated from the governmental activities in the statement of netposition. Any residual balances outstanding between the governmental activities and business-type activities arereported in the statement of activities as "Transfers, nel'.

Fund Financial Statements

Transfers between and within funds are not eliminated from the individual fund statements and are reported as

transfers in and transfers out.

Town of Møshpee, Møssøchusetts 33 B a si c E inønci øl St øtement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

N. DeþrredReueflue

Deferred revenue at the fund financial statement level represents billed receivables that do not meet the availablecriterion in accordance with the current financial resources measurement focus and the modified accrual basis ofaccounting. Deferred revenue is recognized as revenue in the conversion to the government-wide financialstatements (full accrual).

O. Net Position øndFundBølønces

Net position is reported as restricted when amounts are restricted by outside parties for a specific future use.

Net position has been "restricted" for the following:

"Community preservation" represents amounts restricted for open space/ historic resource and affordablehousing purposes.

"Loarrs" represents outstanding septic loans receivable.

"OPEB" represents amounts accumulated for other postemployment benefits.

"Permanent funds - expendable" reptesents amounts held in trust for which the expenditures are restricted byvarious trust agreements.

"Permanent funds - nonexpendable" represents amounts held in trust for which only investment earnings maybe expended.

"Other specific purposes" represents other restrictions placed on assets from outside parties.

Governmental Funds Financial Statements (Fund Balances)

The following fund balance classifications describe the relative strength of the spending constraints:

Nonspendøble - represents amounts that cannot be spent either because they are in nonspendable form (i.e.,prepaid amounts) or because they are legally or contractually required to be maintained intact (i.e., principal ofpermanent fund).

Restncted - represents amounts that can be spent only for specific purposes because of constitutional provisionsor enabling legislation or because of constraints that are externally imposed by creditors, grantors, contributors,or the laws or regulations of other governments.

Committed - represents amounts that can be used only for specific purposes imposed by a formal action of TownMeeting, which is the highest level of decision-making authority for the Town. Committed amounts may beestablished, modified, or rescinded only through actions approved by Town Meeting.

Assigned - represents amounts that do not meet the criteria to be classified as restricted or committed but areintended to be used for specific purposes. Under the Town's structure, only authorized assignments for non-contractual encumbrances can be made by individual department heads.

Unassigned - represents the residual fund balance for the General Fund and the negative residual fund balance ofany other governmental fund that cannot be eliminated by offsetting assigned fund balance amounts.

Toron of Møshpee, Møssøchusetts 34 B øsic Einancial Støtement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30,2013

In circumstances when an expendifure is made for a purpose for which amounts are available in multiple fundbalance classifications, fund balance is depleted in the order of restricted, committed, assigned and unassigned.

Encumbrance amounts have been assigned for specific purposes for which resources already have been allocated.

P. Long-termDebt

Government-Wide and Proprietary Fund Financial Statements

Long-term debt is reported as liabilities in the government-wide statement of net position. Material bondpremiums and discounts are deferred and amortized over the life of the bonds using the effective interestmethod. Bonds payable are reported net of the applicable bond premium or discount.

Governmental Funds Financial Statements

The face amount of governmental funds long-term debt is reported as other financing sources when the debt is

issued. Bond premiums and discounts, as well as issuance costs, are recognized in the current period. Bondpremiums are reported as other financing sources and bond discounts are reported as other financing uses.Issuance costs, whether or not withheld from the actual bond proceeds received, are reported as generalgovernment expenditu res.

Q. Inoestment Income

Excluding the permanent funds, investment income derived from major and nonmajor governmental funds islegally assigned to the general fund unless otherwise directed by Massachusetts General Law (MGL).

Investment income from the proprietary fund is retained in the fund.

R. Compensated Absmces

Employees are granted vacation and sick leave in varying amounts based on collective bargaining agreements,state laws and executive policies.

Governrrrent-Wide and Proprietary Fund Financial Statements

Vested or accumulated vacation and sick leave are reported as liabilities and expensed as incurred.

Governmental Funds Financial Statements

Vested or accumulated vacation and sick leave, which will be liquidated with expendable available financialresources, are reported as expenditures and fund liabilities upon employee retirements and resignations.

S. Post Retirement Benefits

Government-Wide and Fund Financial Statements

In addition to providing pension benefits and, as more fulþ described in Note 12, the Town provides health,dental and life insurance coverage for current and future retirees and their spouses.

Tozan of Møshpee, Møssøchusetts 35 B ø si c Ein ønci øl St øt ement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

T. Use of Estimates

Government-Wide and Fund Financial Statements

The preparation of basic financial statements in conformity with GAAP requires management to make estimatesand assumptions that affect the reported amounts of assets and liabilities and disclosure for contingent assets andliabfüties at the date of the basic financial statements and the reported amounts of the revenues andexpenditures/expenses during the fiscal year. Actual results could vary from estimates that were used.

U. Totøl Column

Government-Wide Financial Statements

The total column presented on the government-wide financial statements represents consolidated financialinformation.

Fund Financial Statements

The total column presented on the fund financial statements is presented only to facilitate financial analysis. Datain this column is not the equivalent of consolidated financial information.

NOTE 2 - STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY

A. Budgetøry Information

Municipal Law requires the adoption of a balanced budget that is approved by Town Meeting vote. The FinanceCommittee presents an annual budget to Town Meeting, which includes estimates of revenues and otherfinancing sources and recommendations of expenditures and other financing uses. Town Meeting, which has fullauthority to amend andf or reject the budget or any line item, adopts the expenditure budget by majority vote.

Increases to the original budget subsequent to the approval of the annual budget require Special Town Meetingapproval.

The majority of appropriations are non-continuing which lapse at the end of each fiscal year. Others arecontinuing appropriations for which the governing body has authorized that an unspent balance from a priorfiscal year be carried forward and made available for spending in the current fiscal year.

Generally, expenditures may not exceed the level of spending (salaries, expenses and capital) authorized for anappropriation account. Ffowevet, the Town is statutorily required to pay debt service, regardless of whether suchamounts are appropriated.

An annual budget is adopted for the general fund and community preservation fund in conformity with theguidelines described above. The original fiscal year 2013 approved budget for the general fund authorizedfi52,245,476 in appropriations. During fiscal year 2013, sttpplemental appropriations totaling fi447,267 wercauthorized. The original and final fiscal year 2013 approved budget for the community preservation fundauthorized Û97 5,435 in appropriations.

The Accountanf s office has the responsibility to ensure that budgetary control is maintained. Budgetary controlis exercised through the accounting system.

The budgetary comparison schedules presented in the accompanying required supplementary informationpresents comparisons of the legally adopted budgets, as amended, with actual results. The originally adoptedbudgets are presented for purposes of comparison to the final, amended budgets.

Town of Møshpee, Massøchusetts 36 BøsicFinanciøI Statements

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

B. FundDeficits

At June 30,2013, the following fund deficits exist:

Fund Amount Funding Source

Road Projects fi 2,977,925 Issuance of long-term debtBuilding Improvements.......... 764,696 Issuance of long-term debtFire Pumper Truck................. 495,362 Issuance of long-term debtARRA Water Restoration........ 203,075 Federal grantPoliceOffDrty.......... 58,160 Chargesforservices

C. Excess ofExpenditures oaer Appropriøtions

For the fiscal year ended June 30, 2013, expenditures exceeded appropriations for state and county charges.

NOTE 3 - DEPOSITS AND INVESTMENTS

The municipal finance laws of the Commonwealth authorize the Town to invest temporarily idle cash in bankterm deposits and certificates of deposits, and treasury and agency obligations of the United States governmentwith maturities of one year or less; U.S. treasury or agency repurchase agreements with maturities of not morethan 90 days; money market accountsi and the state treasurer's investment pool - the Massachusetts MunicipalDepository Trust (MMDT).

A cash and investment pool is maintained that is available for use by all funds with unrestricted cash andinvestments. The deposits and investments of permanent funds are held separately from other Town funds.

Deposits - Custodial Credit Risk

Custodial credit risk for deposits is the risk that, in the event of a bank failure, the Townis deposits may not berecovered. The Town's policy is to rely on FDIC and Depositors Insurance Fund (DIF) insurance coverage and tocollateralizeanadditionalportionoftheirdeposits. AsofJune30,2013,g9,423,829oftheTownsbankbalanceof$20,999,3L6 was uninsured and uncollateralized and, therefore, exposed to custodial credit risk.

Town of Møshpee, Møssøchusetts 3/ B øsic E inønciøl Støtements

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

Investments Summar]¡

The Town s investments at June 30,2013 are presented below. All investments are presented by investment type,with debt securities presented by maturity.

Investment Maturities (in Years)

Investment TypeFair

ValueLess

Than 1 1-5 6-1.0

Debt Securities:

U.S. Treasuries..... ............ $

U.S. Agencies............Money market mutual funds.........Mutual bond funds.External investment pools.

Total debt securities....

Other Investments:

2,466,500

6,963,3121,46,992

1,09,472

7'1,,821,

9,759,097 $

153,352

2,340,647146,992

1,09,472

7't,82't.00

2,668,932

'1,,81,5,287

3,659,066

-$ 65'1,,213

964,599

g 5,473,353 fi 1.,615,812

Equity mutual funds

Totalinvestments.... ........... $ 9,91-1,,449

Investments - Interest Rate Risk of Debt Securities

Interest rate risk for debt securities is the risk that changes in interest rates of debt securities will adversely affectthe fair value of an investment. The Town does not have a policy for interest rate risk of debt securities.

Investments - Custodial Credit Risk

Custodial credit risk for investments is the risk that, in the event of the failure of the counterparty, the Town willnot be able to recover the value of its investments or collateral securities that are in the possession of an outsidepat$. The Town does not have a policy for custodial credit risk of investments. As of June 30,2013, the Townwas not exposed to custodial credit risk.

Investments - Credit Risk of Debt Securities

Credit risk for debt securities is the risk that an issuer or other counterparty to a debt security will not fulfil isobligations. TheTowndoesnothaveapolicyforcreditriskof debtsecurities. AsofJune30,2013,theTown'smoney market mutual fund, mutual bond fund and external investment pool were unrated by a national creditrating organization.

Investments - Concentration of Credit Risk

Concentration of credit risk for investments is the risk of loss athibuted to the magnitude of the Town'sinvestment in a single issuer. The Town does not have a policy for concentration of credit risk of investments. Asof June 30,2013, the Town was not exposed to concentration of credit risk.

Town of Møshpee, Møssøchusetts 38 B asic Financiøl Statements

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

NOTE 4 - ACCOUNTS RECEIVABLE

At June 30,2013, receivables for the individual major governmental funds and nonmajor governmental andfiduciary funds in the aggregate, including the applicable allowances for uncollectible accounts, are as follows:

GrossAmount

Allowancefor Net

Uncollectibles AmountReceivables:

Real estate and personal property taxes......... $Real estate tax deferraIs...............Tax and trash liens..Motor vehicle and other excise taxes..............Community preservation surcharges.Special assessments

Departmental and other.........Intergovernmental..........Loans........

833,134 $27,092

L,013,582648,175M,643

1,,854,31,2

438,686

4,5M,259188,183

(165,287) $

(319,654)

(200,492)

667,U727,092

7,013,582328,52-1,

44,643'L,854,312

238,1944,5M,259

188,183

fi 8,906,633g 9,592,066 $ (685,433)

Governmental funds report deferred reaenue in connection with receivables and other assets (tax foreclosures) forrevenues that are not considered to be available to liquidate liabilities of the current period. The followingidentifies the various components of deferred reaenue reported in the governmental funds:

OtherGeneral GovernmentalFund Funds Total

Receivable type:Real estate and personal property taxes. ...... ............. $Real estate tax deferraIs...............Tax and trash liens..

Motor vehicle and other excise taxes..... -, -.

Community preservation surcharges. .

Special assessments

313,74027,092

'1,,001,,326

328,52't

3,384,M094,01.4

686,349

12,256

M,643L,854,312

238,194

313,74027,092

-1,,013,582

328,52LM,643

1,854,312238,194

3,384,M094,0'1,4

686,U9

(b)

(u)(b)(b)Departmental and other.........

Intergovernmental (state school construction)Intergovernmental (other state and federal)..Tax foreclosures...........

Tota1......... ....... $ 5,835,482

(a) Community preservation fund (major fund)(b) Nonmajor governmental funds

2,'L49,405 fi 7,984,887

Toran of Møshpee, Møssøchusetts 39 B øsi c EinanciøI St øt ement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

The Commonwealth has approved school construction assistance. The assistance program, which is administeredby the Massachusetts School Building Authority (MSBA), provides resources for future debt service of generalobligation school bonds outstanding. During fiscal year 2013,9944,439 of such assistance was received.93,74'1,,593 will be received in future fiscal years. Of this amounf fi357,153 represents reimbursement of long-terninterest costs, and 93,384,M0 represents reimbursement of approved and incurred construction costs.Accordingly, a93,384,M0 intergovernmental receivable and corresponding deferred revenue have been reportedin the governmental funds financial statements. The deferred revenue has been recognized as revenue in theconversion to the government-wide financial statements

NOTE5-CAPITALASSETS

Capital asset activity for the fiscal year ended June 30, 2013, is as follows:

BeginningBalance Increases Decreases

EndingBalance

Govemmental Activities :

Capital assets not being depreciated:

Land........... $

Construction in progress. . .

Total capital assets not being depreciated......

Capital assets being depreciated:

Buildings and improvements.........

Machinery, vehicles and equipment..................Infrastructure

Total capital assets being depreciated

Less accumulated depreciation for:

Buildings and improvements.........Machinery, vehicles and equipment... ... . ... ...... ...Infrastructure. . . . . . . . . . . . . . . .

Total accumulated depreciation...... . ... ... ... ...

Total capital assets being depreciated, net. . .... ... ... ....

Total governmental activities capital assets, net. ..... ..

92,578,91.2

(30,957,279) (1.,873,051)

(4,460,816) (366,604(5,841,151) (487,281)

(41.,259,246)

51,319,666

fi 11.0,274,382 fi 2,31,4,849

(2,726,939) 312,451. (43,673,734)

227,333 (12,484) 51.,534,515

58,894,716 2,087,5L6

58,192,253 $

702,463

51,350

2,036,L66

$ (86,013)

(103,664)

(1.89,674

58,157,590

2,634,965

60,792,555

73,991,666

6,065,961

15,150,622

95,208,249

Q2,830,330)(4,51,4,972)

(6,328,432)

73,935,521.

5,617,981

13,025,410

56,L45

772,915

2,1.25,272

2,954,272

(324,935)

(324,935)

312,451

fi (202,1.61) fi 112,327,070

Tozan of Møshpee, Møssøchusetts 40 B øsic F in ønciøl Støtement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

Beginning EndingBalance Increases Decreases Balance

Business-Type Activities:

Capital assets being depreciated:Buildingsandimprovements......... $ SZ,SSZ $ $ - $ 42,542

Less accumulated depreciation for:Buildings and improvements......... (532) (532) - (1.,064)

Totalbusiness-typeactivitiescapitalassets,net......... fi 42,010 $ (532) $ - $ 41,478

Depreciation expense was charged to functions /programs of the primary government as follows:

Governmental Activities:General government g 170,872

Public safety........ 398,318

Education.. 1,,241,,353

Public works.. 608,511

Health and human services...... 57,827

Culture and recreation............. 250,058

Total depreciation expense - goverrunental activities....... .... g 2,726,939

Business-Type Activities:Kids Klub.. $ SgZ

NOTE 6 - INTERFUND TRANSFERS

Interfund transfers for the fiscal year ended June 30, 2013, are summarized as follows:

Transfers In:

NonmajorGeneral Governmental

Transfers OuL Fund Funds Total

GeneralFund......... $ - $ 60,000 $ 60,000 (1)Community Preservation Fund......... 930,135 - 930,135 (2)Nonmajor Governmental Funds........ '1,,287,600 - '1,,287,600 (3)

$ 2,217,735 g 60,000 g 2,277,735

(1) Represents budgeted transfer to the unemployment special revenue fund

(2) Represents budgeted transfer to fund debt service principal and interest

Town of Mashpee, Møssøchusetts 41 B ø si c E inanci øl St øtement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

(3) Represents budgeted transfers to the general fund from ambulance receipts (6593,987),, street betterments(fi345,682), waterways improvement ($195,419), media government access ($91,150), shellfish receipts($20,000), cemetery receipts ($15,000), hotel/motel receipts ($10,000), septic betterment ($11,362) andconservation ($5,000) special revenue funds.

NOTE 7 - SHORT-TERM FINANCING

Short-term debt may be authorized and issued to fund the following:

o Current operating costs prior to the collection of revenues through issuance of revenue anticipation notes(RAN) or tax anticipation notes (TAN).

o Capital project costs and other approved expenditures incurred prior to obtaining permanent financingthrough issuance of bond anticipation notes (BAN) or grant anticipation notes (GAN).

Short-term loans are general obligations and carry maturity dates that are limited by statute. Interestexpenditures for short-term borrowings are accounted for in the general fund.

Details related to the short-term debt activity for the fiscal year ended June 30, 2013, are as follows:

Type Description

Origination Maturity Interest

Date Date Rate

Balance at

June 30,

Increases Decreases 2013

Balance at

June 30,

2012

BAN Buildings and roads...... 11/23/11 17/15/12 0.80%

BAN Buildings and roads...... 77/15/1.2 9/1.6/13 0.40%

BAN Buildings and roads...... 11/15/72 9/16/13 0.44%

BAN Roadproject................. 6/25/13 9/1.6/13 0.60%

BAN Road project................. 6/25/13 9/16/13 0.50%

BAN Road project................. 6/25/73 9/16/13 0.60%

s 2,209,8s9 $ -$1,000,000

1,2og,g5g

1.,593,80L

1,000,000

500,000

(2,209,8s9) $1,000,000

7,209,859

1,593,801

1,000,000

50o000

Tota1............ S 2,209,859 $ 5,303,660 fi (2,209,859) $ 5,303,660

Subsequent Event

On September 1.6,2013, the Town paid off $110,000 of the $5,303,660 of outstanding buildings and roads BANsand renewed the remaining balance of fi5,193,660 at an interest rate of L.0o/o and a maturity date of fanuary 31,2014.

Town of Mashpee, Møssachusetts 42 B øsic Einancial Støtements

Notes to Basic Financial Statements For the Fiscal Year Ended fune 30, 2013

NOTE 8 - LONG-TERM OBLIGATIONS

The following represents a summary of changes that occurred in long-term obligations during the fiscal yearended June 30, 2013:

Balance

June 30,2012 Increases Decreases

Balance

June 30,

2013

CurrentPortion

G overnmental Activities:Bonds and notes payable, gross.......Unamortized premium.Deferred loss on refundings..

Bonds and notes payable, net.........,

Capital lease obligation..................Landfill closure and post-closure.....

Net OPEB obligation...

Compensated absences. .

Total..... g 48,242,883 $ 4,709,991 fi 47,729,187 fi 3,873,686

g 27,726,535M2,394

(5-t4,639)

27,654,280

160,399

454,379

17,549,1.00

2,424,726

(3,52L,363)(126,396)

147,041

fi 24,205,172

315,988(367,598)

24,153,562

150,131

M2,079

20,600,649

2,382,766

$ 3,525,950126,396

(147,041)

3,505,305

115,104

15,000

238,277

-$

'1,05,1,99

4,604,782

(3,500,718)

(715,466)

(12,300)

(7,553,233)

(47,960)

g (5,223,677)

Business-type Activities:Net OPEB obIigation..................... $ 202,342 $ 55,507 $ (18,723)fi 239,126 $ -

These long-term liabilities are generally liquidated by the general fund. The community preservation major fundtransfers amounts to the general fund to pay for its share of debt service expenditures, which are primarilyrelated to land acquisition debt.

Tozan of Møshpee, Møssøchusetts 43 B øsi c Einanciøl Statements

Notes to Basic Financial Statements For the Fiscal Year Ended fune 30, 2013

NOTE9-LONG.TERMDEBT

Details related to the Town's outstanding indebtedness at June 30, 2013, are as follows:

Bonds ønilNotes Payøble - GouernmentøIEunds

ProjectInterest

Rate

Outstandingat June 30,

2012 Issued

Outstandingat ]une 30,

Redeemed 2013

Landfill Capping (N'[WPAT)........Landfill Capping (MWPAT).......,Septic Repair (MWPAT)...Sewer Facilities (MWPAT)..........Septic Repair (MWPAT)...Land Acquisition...........Fire Equipment..............Refunding Bonds (Series A). . . . . .. .

Septic Replacement (MWPAT)....Septic Replacement (MWPAT)....Septic Replacement (MWPAT).. ..

Municipal Purpose......Septic Replacement (MWPAT)....Municipal Purpose......Municipal Purpose......

Sub-total

Unamortized premium....Deferred loss on refundings........

Total governmental funds, net. . .. .

4.90%

5.30%5.00%

4.90%0.00%

3.90%

3.907,3.60%

0.00%

0.00%

2.00%

450%0.00%

3.25-5.00%

2.50-4.00%

352,500

40,000

93,40215,345

119,000

2,095,000

200,000

9,150,000

87,17891,,23'1,

79,967

5,950,000

132,91,2

3,970,000

5,450,000

$ (25,900)

(5,000)

(10,400)

$,42n(8,500)

(215,000)

(50,000)

(1,965,000)p,68n

(10,190)

(560,000)

(1,0,259)

(295,000)

(355,000)

(3,52'J.,363)

(126,396)'t47,041.

fi 326,600

35,000

83,00213,918

110,500

L,990,000

150,000

7,195,000

77,491.

81.,041.

79,967

5,290,000

122,653

3,675,000

5,095,000

24,205,172

315,ggg

(367,598)

27,726,535

442,384(514,639)

27,654,280 $ $ (3,500,718) $ 24,153,562

The Town receives subsidy assistance for the Massachusetts Water Pollution Abatement Trust (MWPAT).Principal and interest on the outstanding bonds for M\AIPAT is subsidized over the life of the bonds to assist theTown in the repayment of this future debt. During fiscal year 2013, the Town's subsidy totaled approximately947,000. Future subsidies total approximately 9234,000. The amount of MWPAT bonds outstanding at June 30,2013, totaled 9930,172.

Tozan of Møshpee, Møssøchusetts u B n si c Einønci øl St øtement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

Debt service requirements (gross) for principal and interest for governmental bonds and notes payable in futurefiscal years are as follows:

Fiscal Year Interest Total

201.4............. $2015..

201.6..

2017....20't8....2019....2020..

2021,..

2022....2023....2024..

2025..

2026....2027....2028..

2029

2030

2031

20322033

2034

Principal

3,525,950 $

3,501,527

3,342,722

2,794,380

1,,366,040

L,357,30'L

1,234,365

1,,189,234

1,137,556

942,638

927,309

842,394

797,5gg

524,187

404,278

294,37-1,

4,466

4,563

4,662

4,763

4,868

4,464,310

4,294,212

3,985,575

3,300,372'1,,749,236

L,69L,608

1,523,863

L,438,573'1,,349,508

L,117,342'1,065,307

945,770

870,M'1,

569,923

430,592

306,525

4,932

4,940

4,948

4,956

4,965

938,360

792,685

642,853

505,992

383,196

334,307

289,498

249,279

211,952

174,704

137,998

103,376

72,843

45,736

26,314'1,2,'i,54

466

377

286

19397

Total............ $ 24,205,172 g 4,922,666 fi 29,127,838

The Town is subject to various debt limits by statute and may issue additional general obligation debt under thenormal debt limit. At June 30,2013, the Town had the following authorized and unissued debt:

Purpose Amount

Road projects........... $Building improvements... ....Mashpee River dredge........Solar power.. ......

4,000,477 *

1,500,000 *

275,00050,000

Total. ............. $ 5,825,477

* BANs totaling $3,803,660 and $1,500,000, respectively, are issued and outstanding at June 30,2013.

NOTE 10 - CAPITAL LEASES

The Town has entered into certain capital lease agreements for vehicles under which the vehicles will become the

property of the Town when all of the lease requirements are met. The agreements also contain early purchase

options which would allow the Town to purchase the vehicles before the end of the lease terms.

Town of Møshpee, Møssøchusetts 45 B ø sic F inanciøl Støtement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

The following schedule presents future minimum lease payments as of June 30,2013:

Fiscal YearEnding Iune 30

2015

Total minimum lease payments...

Less: amounts representing interest

Present value of minimum lease payments.......

GovernmentalActivities

123,086

37,129

1.60,2L5

(10,084)

$ 150,131

Vehicles and related accumulated amortization under capital leases are as follows:

GovernmentalActivities

Asset:Vehicles..... $ a51.,554

(1,40,711)

fi 210,843

Less: accumulated amortization.

Amortization of leased vehicles under capital assets is included with depreciation experue.

NOTE 1.1. - LANDFILL CLOSURE AND POSTCLOSURE CARE COSTS

State and federal laws and regulations required the Town to close its old landfill site when it stopped acceptingwaste and to perform certain maintenance and monitoring functions at the site after closure. The Town hadoperated a solid waste landfill that ceased operations tn1998 and, accordingly, was subsequentþ capped andfunded via long-term debt. The Town has reflected $442,079 as the estimate of the landfill post-closure caretiability at June 30,2013. Actual costs may be higher due to inflatioru changes in technology, or changes inregulations.

NOTE 1.2 - OTHER POST EMPLOYMENT BENEFITS

PlønDescription -The Town provides health, dental and life insurance coverage for its retirees and theirsurvivors (hereinafter referred to as the 'Plar',') as a single-employer defined benefit Other Post EmploymentBenefit (OPEB) plan. Chapter 328 of the MGL assigns authority to establish and amend benefit provisions.Changes to plan design and cont¡ibution rates must be accomplished through the collective bargaining process.The Plan does not issue a stand alone financial report since there are no assets legally segregated for the solepurpose of paying benefits under the Plan.

Toron of Møshpee, Møssøchusetts 46 B asic Einanciøl Statements

Notes to Basic Financial Statements For the Fiscal Year Ended fune 30, 20L3

The number of participants as of July 1,2012, the latest actuarial valuatiorç is as follows:

Active employees..Retired employees, beneficiaries and dependents. . .. .. .. .

Total

Funding Policy -The contribution requirements of Plan members and the Town are established and may beamended by the Town. The required health insurance (including Medicare Part B) contribution rates of Planmembers and the Town are 25% and75%, respectively. Plan members contribute 100o/o towards dental i¡surance.The Plan members and Town contribute 25% and7íYo, respectively, towards a $4,000 term life insurancepremium. The Town currentþ contributes enough money to the Plan to satisfy curtent obligations on a pay-as-you-go basis. The costs of administering the Plan are paid by the Town.

Anwnl OPEB Cost andNet OPEB Obligøtion - The Town's annual OPEB cost (expense) is calculated based onthe annual required contribution (ARC) of the employeÍ, at:. actuarially determined amount that is calculated inaccordance with the parameters set forth in GASB Statement #45. The ARC represents a level of funding that, ifliabfities (or funding excess) over a period not to exceed thirty years.

The following table identifies the components of the Town s annual OPEB cost for the year, the actual amountcontributed to the plan, and changes in the Town's net OPEB obligation:

Amount

328236

564

Annual required contributionInterest on net OPEB obligation...Adjustment to annual required contribution

Annual OPEB costContributions made

fi 4,509,361,

798,875(647,887)

4,660,289(1,571,956)

Increase in net OPEB obligation... 3,088,333Net OPEB obligation at beginning of year....... 17,751,,M2

Net OPEB obligation at end of year....... g 20,839,775

Trend information regarding annual OPEB cos! the percentage of the annual OPEB cost contributed and the netOPEB obligation is as follows:

Fiscal YearEnding

AnnualOPEB Cost(AOPEBC)

fi 4,863,2-1.0

5,179,9094,660,299

PercentageofAOPEBCContributed

25.1/o

262%33.7%

NetOPEB

Obligation

g 13,929,66417,751,,442

20,839,775

Tozon of Møshpee, Massachusetts 47 B asic E inanci øl S tatement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

Funded Støtus ønd Funiling Progress - The funded status of the Plan at July '1.,2012, the most recent actuarialvaluation, was as follows:

ActuarialValuation

Date

ActuarialValue ofAssets

(A)

ActuarialAccrued

Liability (AAL)Entry AgeNormal

(B)

UnfundedAAL

(UAAL)(B-A)

62,263,573

Funded CoveredRatio Payroll(A/B) (c)

UAAL as a

Percentage

of Covered

Payroll((B-A)/c)

224.0%07/01./12 $ 62,263,573 $ - $ 27,792,519

Acfuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptionsabout the probability of occurrence of events far into the future. Examples include assumptions about futureemployment mortality, and the healthcare cost trend. Amounts determined regarding the funded status of theplan and the armual required contributions of the employer are subject to continual revision as actual results arecompared with past expectations and new estimates are made about the future. The schedules of fundingprogress, presented as required supplementary information following the notes to the financial statements,presents multi-year trend information that shows whether the actuarial value of plan assets is increasing ordecreasing over time relative to the actuarial accrued liabfüties for benefits.

Methods and Assumptions - Projections of benefits for financial reporting purposes are based on the substantivePlan (the Plan as understood by the employer and plan members) and include the types of benefits provided atthe time of each valuation and the historical pattern of sharing of benefit costs between the employer and Planmembers to that point. The actuarial methods and assumptions used include techniques that are designed toreduce short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with thelong-term perspective of the calculations.

The significant methods and assumptions as of the latest actuarial valuation are as follows:

Valuation date:

Actuarial cost method:

Amortization method:

Remaining amortization period:

Interest discount rate:

Healthcare/ Medical cost trend rate:

Projected salary increases:

July 1,2012

Entry Age Normal

Amortìzation payments increasing at 4.0%

30 years atJuly 1.,2012 (open)

450%

Health - 8.0% decreasing 0.50% for six years to an ultimate level of 5.0%

4.0% anrnally

Town of Møshpee, Møssachusetts 48 B a si c E inanci øl St øtements

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

Allocøtion of AOPEBC - AOPEBC costs were allocated to the Town's functions as follows:

Governmental Activities:General governmentPublic safety........Education...Public works........Health and human services.....Culture and recreation...........

Total AOPEBC - governmental activities. .. . . . . . . . . .. .. . . . . .,

Business-Type Activities:Kids klub...

Total AOPEBC............

$ 288,128

1.,137,854

2,665,877

317,75873,035

122,130

4,604,782

55,507

fi 4,660,289

Town of Møshpee, Møssøchusetts 49 B øsi c E inanciøI St øt ement s

Notes to Basic Financial Statements For the Fiscal Year Ended fune 30, 2013

NOTE 13 - FUND BALANCES

The constraints on fund balances as listed in aggregate in the Governmental Funds Balance Sheet are detailed as

follows:

GeneralCommunityPreservation

NonmajorGovernmental

Funds

TotalGovernmental

Funds

Nonspendable:Loans........ ...... $Permanent fund principal.............

-$ $ 188,183

45,052

188,183

45,052

Sub-total - Nonspendable........... 233,235 233,235

Restricted:Debt service 272,077o8E8......... 270,372Community preservation 6,261,,828

'1,51L,717

1,355,659

615,871.

1,52,608

75,833400,323

375,042865,370

759,6008,788

230,639

272,077

270,372

6,261,,929

1,,511,,717'1,355,659

61.5,871.'1.52,608

75,933400,323

375,042865,310

759,600g,7gg

230,639

Ambulance receipts reserved........Street betterments.........Septic bettermentsSchool lunch.........Cable access

General governmentPublic safety.........Education...Public works........Hea]th and human services...........Culture and recreation.................

Sub-total - Restricted.

Committed:Subsequent year's expenditures.....Continuing appropriations........ ...

Sub-total - Committed

Assigned:Encumbrances..............

Unassigned

Total fund balances.....

NOTE 14 - STABILIZATION FUNDS

542,449 6,261,,828 6,351,390 1,3,155,667

2,035,259746,903

2,035,258

746,903

2,782,16'1,

271,060

2,782,161,

271,060

10,280,566 (3,899,21,8) 6,381,,348

2,685,407 $ 22,823,471,

The Town maintains a general stabilization fund that was established under MGL Chapter 40, Section 58.Appropriations in and out of the stabilization fund require two-thirds vote of Town Meeting. Investment incomeis retained by the fund.

Tozan of Møshpee, Massachusetts

g 13,876,236 g 6,261,929 $

50 B øsic Einøncial Statements

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

The balance of the stabilization fund at june 30,2013 totals $3,989,381 and is reported in the general fund as

unassigned fund balance.

NOTE 15 - RISK FINANCING

The Town is exposed to various risks of loss related to torts; theft of, damage to and destruction of assetsi errorsand omissions; and natural disasters for which the Town carries commercial insurance.

Heølth Insurance

The Town participates in a health insurance risk pool administered by the Cape Cod Municipal Health Group(Group). The Group offers a variety of premium based plans to its members with each participatinggovernmental unit charged a premium for coverage based on rates established by the Group. The Town isobligated to pay the Group its required premiums and, in the event the Group is terminated, its proportionateshare of a deficit, should one exist.

The amount of claim settlements has not exceeded insurance coverage in any of the previous three fiscal years.

Workers' Compensøtion

The Town participates in a premium-based workers' compensation policy for all employees. The amount ofclaim settlements has not exceeded insurance coverage in any of the previous three fiscal years.

Un emp I o y m ent ln s ur øn c e

The Town is self-insured for its unemployment insurance activities. The Town's liability for unemploymentclaims is immaterial at June 30,2013, and therefore is not reported.

NOTE 16 - PENSION PLAN

Pløn Description - The Town contributes to the Barnstable County Retirement Association (Association), a cost-sharing multiple-employer defined benefit pension plan administered by the Barnstable County RetirementBoard. Substantially all employees of the Town are members of the Association, except for public school teachersand certain administrators who are members of the Massachusetts Teachers Retirement System.

Chapter 32 oÍ the MGL assigns authority to establish and amend benefit provisions of the plan. The Associationprovides retirement disability and death benefits to plan members and beneficiaries. Cost-of-living adjustmentsgranted between 1981. and1997 and any increases in other benefits imposed by the Commonwealth's state lawduring those years are borne by the Commonwealth and are deposited into the pension fund. Cost-of-livingadjustments granted after 1997 must be authorized by the Barnstable County Retirement Board and are borne bythe Association. The Association issues a publicly available report in accordance with guidelines established bythe Commonwealth's Public Employee Retirement Administration Commission. That report may be obtained bycontacting the Association located at750 Attucks Lane, Hyannis, Massachusetts, 02601.

Funding Policy - Chapter 32 oÍ MGL governs the contributions of plan members and the Town. Plan membersare required to contribute to the Association at rates ranging from 5% to 11% of annual covered compensation.The Town is required to pay into the Association its share of the association-wide actuarial determinedcontribution that is apportioned among the employers based on annual covered payroll. The Town'scontributions to the Association for the fiscal years ended June 30, 2013,2012, and2011 werefi2,L68,624,$2,086,262 and$1,,973,785, respectively, which equaled its required contribution for each fiscal year.

Town of Møshpee, Møssøchusetts 51 B øsic Einanciøl Støtements

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

NOTE 17 - MASSACHUSETTS TEACHERS RETIREMENT SYSTEM

Public school teachers and certain administrators are members of the Massachusetts Teachers Retirement System,to which the Town does not contribute. Pension benefits and administrative expenses aid by the TeachersRetirement Board are the legal responsibility of the Commonwealth. The amount of these on-behalf paymentstotaled approximately $2,592,000 for the fiscal year ended June 30, 2013, and, accordingly, are reported in thegeneral fund as intergovernmental revenues and pension expenditures.

NOTE 18 - COMMITMENTS

The Town has entered into, or is planning to enter into, contracts totaling approximately $5,825,000 for projectsrelated to building improvements, infrastructure and equipment. These projects will be funded through theissuance of long-term debt.

Other significant commitments include the encumbrances and continuing appropriations outstanding for thegeneral fund, which totaled fi1,017,963 atJune 30,2013.

NOTE 1-9 - CONTINGENCIES

Various legal actions and claims are pending against the Town. Litigation is subject to many uncertainties, andthe outcome of individual litigated matters is not always predictable. Although the amount of liability, ú any, at

June 30, 2013, cannot be ascertained, management believes any resulting liabiliÇ should not materially affect thefinancial position of the Town at June 30,2013.

The Town participates in a number of federal award programs. Although the grant programs have been auditedin accordance with the provisions of the Single Audit Act Amendments of 1996 through June 30, 2013, theseprograms are still subject to financial and compliance audits. The amount, iÍ any, of expenditures which may bedisallowed by the granting agencies cannot be determined at this time, although the Town expects such amounts,ú any, to be immaterial.

NOTE 20 - FUTURE IMPLEMENTATION OF GASB PRONOUNCEMENTS

The GASB has issued the following statements:

during fiscal year 201.4. Martagement does not believe the implementation of this Statement willsignificantly impact the basic financial statements.

is required to be implemented during fiscal year 2014. Management does not believe the implementationof this Statement will impact the basic financial statements.

required to be implemented during fiscal year 2014. Management has determined that theimplementation of this Statement will not impact the basic financial statements.

Town of Møshpee, Møssachusetts 52 B a si c Finønci øl St øt ement s

Notes to Basic Financial Statements For the Fiscal Year Ended June 30, 2013

27, which is required to be implemented during fucal year 2015. The implementation of this Statementwill represent a significant change in the accounting and reporting of pension expense and the relatedliability. For the first time, the Town will be required to recognize its long-term obligation for pensionbenefits as a liability and to more comprehensively measure the annual costs of pension benefits. Theimplementation of this Statement also expands pension related note disclosures and requiredsupplementary information.

implemented during fiscal year 2015. Management does not believe the implementation of this Statementwill impact the basic financial statements.

required to be implemented during fiscal year 2014. Management does not believe the implementation ofthis Statement will impact the basic financial statements.

These pronouncements will be implemented by their respective implementation dates.

Town of Møshpee, Massachusetts 53 B øsi c E inøncial St øternents

This page left intentionally blank.

54

Re q uir e d Supplement øry Inf ormøti on

55

GENERALFUNDSCHEDULE OF REVENUE' EXPENDITURES AND CHANGE IN FUND BALANCE

(NON-GAAP BUDGETARY BASIS)BUDGET AND ACTUAL

FOR THE FISCAL YEAR ENDED JUNE 30, 2013

Prior YearEncumbrancesand ContinuingAppropriations

REVENUESReal estate and personal property taxes .. .. ... ...... $ -Motor vehicle and other excise taxes.....

Payments in lieu of taxes... . . ..

Charges for services.. .

Trash disposalIntergovernmental .... ..... ..... .

Penalties and interest on taxes.. . ... .......Licenses and permits....Fines and forfeitures.. . ...

Departmental and other.. . ..Investment income...........

TOTALREVENUES......

Tax and trash liens

OriginalBudget

g 39,529,L04 $

1,,-154,44

SupplementalAppropriationsand Transfers

FinalBudget

fi 39,529,1041.,-154,M

- 2,500_ 217,150

- 353,516

- 6,390,01,5

- 200000- 180,000- 35,000- 100000- -101'390

EXPENDITURESCurrent:

General government. . ..

Public safety...

Public works.. .

Healthandhumanservices .. ......Culture and recreation.Pensionbenefits ...... ....Employee benefits.. . ... . ...

TOTAL OTHER FINANCING SOURCES (USES).....

NET CHANGE INFUND BALANCE.....

FUND BALANCE ATBEGINNING OF\GAR

FUND BALANCE AT END OF YEAR.. . ... ,

See notes to required supplementary information.

531,506

200,655

2,500217,1.50

353,5-16

6,390,075200,000

180,000

35,000100,000101,390

48,263,1-19

3,012'3307,768,848

19,733,2-12

4,834,309

661,467706,205

2,177,885

6,097,733

578,0001,,465,759

3,519,7961,,"t29,932

(128,501)

2-1,074

336,0001,62,875

-12,842

(4,342)

42,727

5,-192

48,263;119

3,41.5,335

7,990,577

20,069,272

5,31.6,117

674,309709,435

2,777,885

6,1.44,860

583,192

1,465,759

3,519,7961,129,932

53,\96,409

Education.. .....31,8,933

7,572

5,000

Property and liability insurance... .

State and county chargesDebt service:

Principal........Interest...........

TOTAL EXPENDITURES

EXCESS (DEFICIENCY) OF REVENUESOVER EXPENDITURE9 . (1,,063,666) (3,422ß5n e47,267) (4,e33,2e0)

447,267

OTHER FINANCING SOURCES (USES)

Transfers in.... .............Transfers out........... ... . .

-r,063,666 51,,685,476

2,1,96,660

(s60,000)

1,636,660

(1,063,666) (1,785,6en

7,802,205 7,802,205

6,016,508

(426,192)

7,802,205

2,217,735(s60,000)

1,,657,735

(3,275,s55)

7,802,205

21,075

21.,075

7,376,013 fi 4,526,650

Tozun of Mnshpee, Møssachusetts

fi 6,738,s39 $

B øsic Finønci øl S tøtements

Actual

Cur¡ent Yea¡ Actual andEncumbrances Encumb¡ances Variance

and Continuing and Continuing Positive/Appropriations Appropriations (Negative)

39,&6,155-t,846,140

413,9651,0,478

219,720690,207

6,458,873

493,629

468,801,

69,368

180,03272,530

39,646,1551.,846,1,40

413,96510,478

2t9,720690,207

6,458,873

493,629

468,801,

69,368180,03272,530

$ 1-17,051

697,696

413,965

7,978

2,570336,691,

68,858293,629

288,801

34,368

80,032(28,860)

2,306,n950,569,898 50,569,898

2,611,,285

7,589,959

19,89],1924,840,255

630,404

687,424

2,175,839

5,623,348470,822

7,608,755

3,579,796

1,118,385

50,767,464

519,992282,863

210,61,0

't,1,86

3,372

3,r31,2n7,872,822

19,891.,192

s,0so86s630,404

688,61,0

2,"175,839

5,626,660

470,8221,608,755

3,519,796

1,118,385

51,,785,427

284,058

177,755

778,020

265,25243,905

20,825

2,046518,200112,370

(742,ee6)

11,,547

r,410,982

3,717,761

7,017,963

(1e7,566) (7,077,e63) (7,275,52e)

2,217,735(s60,000)

1,,657,735

1,,460,169

7,802,205

2,277,735

(s60,000)

-t,657,735

(1,,017,e63)

7,802,205

42,206 3,717,761

7,802,205

$ 9,262,374 fi 6,784,242 g 3,717,761.

Toun of Mashpee, Møssachusetts

8,2M,477

57 B asic FinanciøI Statements

COMMUNITY PRESERVATION FUNDS.HEDULEo'ou"'Tffó,TäiT3fi

H"TåY";TåU"'TNFUNDBALANCEBUDGET AND ACTUAL

FOR THE FISCAL YEAR ENDED IUNE 30 2013

Prior YearEncumbra¡cesand ContinuingAppropriations

REVENUESComrnunity preservation surcharges. .. . . . . . . . . . $Intergovernmental ......,.....

OriginalBudget

g 1,093,678 g

245,519

SupplementalAppropriationsand Tralsfers

FinalBudget

s 1,093,678

245,519Investment income.........

TOTAL REVENUES... t,339,797

EXPENDITURESCurrent:

Administrative..................Acquisitions and projects... 866,330

1,,339,197

40,000

5,300

TOTAL EXPENDITURES.......,..........

EXCESS (DEFICIENCY) OF REVENUESOVER EXPENDITURES........

oTHER FTNANCTNG SOURCES (USES)

Transfers out..............

NET CHANGE IN FUND BALANCE....

FUND BALANCE AT BEGINNING OF YEAR....

FUND BALANCE AT END OF YEAR...............

See notes to required supplementary information

866,330 45,300

(866,330) 1.,2e3,8e7

40,000

871,630

911,,630

427,567

(866,330)

5,871,,948

(930,135)

363,762

5,871,,948 5,87'J,,948

(e30,13s)

(s02,568)

5,871,,948

$ s,005,618 g 6,23s,710 g s,871.,948 $ s,369,380

Town of Møshpee, Massachusetts 58 B a si c F inan ciøI S tatement s

Actual

fi 1.,197,227

331,551

(1,s,42s)

1,,513,353

Current Yea¡Encumbra¡cesand ContinuingAppropriations

Actual andEncumbrancesand ContinuingAppropriations

s 't,197,227

331,551

(1,s,425)

1,513,353

Va¡iancePositive/(Negative)

$ 103,s49

86,032

(7s,42s)

174,1,56

24,253

169,085 702,54524,253

871,,630

15,747

793,338 895,883 1,5,747

(930,135)

389,880

5,871,948

7,320,01,5 (702s45) 617,470

(930,13s)

(312,66s)

5,871,,948

1,89,903

t89,903(702,54s)

5,871,,948

6,26]^,828 $ 5,1,69,403 fi s,s59,283 $ 189,903

Tozon of Mashpee, Massøchusetts 59 B øsic Einøncinl Statements

PENSION PLAN SCHEDULES

The following schedules provide information related to the Association as a whole, for which the Town is oneparticipating employer :

ActuarialValuation

Date

01/01/1201/01./1001/01/0e01,/01,/07

01,/0L/0601,/01,/04

Fiscal YearEnded

2008

20092010

2011.

20122013

Percentage of Town ARCARC as a Percentage of

Contributed (%) Association ARC (%)

SCHEDULES OF FUNDING PROGRESS (ASSOCIATION)

Actuarial UAAL as a

Actuarial Accrued Unfunded PercentageValue of Liability (AAL) AAL Funded Covered of CoveredAssets Entry Age (UAAL) Ratio Payroll Payroll(A) (Bl (B-A) (A/B) (c) ((B-A)/c)

fi 651.,063,981 g 1,,173,483,848 g 522,419,867 55.5% fi 239,437,303 218.2%

554,876,554 7,030,2-1.0,321 475,333,767 53.9% 234,374,075 202.9%

520,089,855 966,564,614 M6,474,759 53.9% 249,97'J.,296 179.6%

517,396,087 925,963,069 309,466,991 62.6% 226,39'1.,633 136.3%

465,637,984 765,747,723 300,109,739 60.9% 215,474,190 139.3y,

378,317,300 647,655,411 269,339,111 59.4% 190,614,004 141.3%

SCHEDULE OF EMPLOYER CONTRIBUTIONS (ASSOCIATION)

The following schedule provides information related to the Town's portion of the Association's ARC:

TOWN SHARE OF ASSOCIATION ARC

Year EndedDecember 31

2007

2008

2009

201,0

2011,

2012

ARC

AnnuallyRequired

Contributions(ARC)

g 34,360,912

36,982,873

39,899,32243,993,051

43,807,158

46,702,087

Percentage ofARC

Contributed (%)

100

100100

100

100100

'1,,654,147

'1,,755,569

1,,856,927

1,,973,785

2,086,262

2,'1,68,624

100

100

100

100

100

100

4.8%

4.77'4.7%

45%4.8%

4.67o

Town of Mashpee, Møssøchusetts 60 Re qaired Supplementøry Informøtion

OTHER POST EMPLOYMENT BENEFITS SCHEDULE

The following schedule provides information related to the Town's other post-employment benefits plan:

SCHEDULES OF FUNDING PROGRESS

ActuarialValuation

Date

07 / 01./ 06

07 /01./0807 /01./1.007 /01,/12

ActuarialValue ofAssets

(A)

ActuarialAccrued

Liability (AAL)Projected Unit

Credit(B)

UnfundedAAL

(UAAL)(B-A)

Covered

Payroll(c)

UAAL as a

Percentage

of Covered

Payroll((B-A)/c)

196.1,%

258.7%

233.2%

224.0%

Funded

Ratio

(^/B)

52,979,263

70,968,008

62,486,927

62,263,573

fi 52,979,263

70,969,009

62,486,927

62,263,573

fi 27,01't,764

27,428,318

26,798,532

27,792,519

The significant change to the methods and assumptions used in the actuarial valuations identified above thatimpacted trends in the schedules of funding progress is that the 07 / 01/10 valuation reflects the Town's adoptionof Massachusetts General Laws Chapter 328, Section 18, which shifted certain other postemployment benefitscosts from the Town to a Medicare extension program

Tozan of Mashpee, Møssachusetts 61 Re E út e d S upplem ent ary Inf o rm ati on

Notes to Required Supplementary Information For the Fiscal Year Ended June 30, 2013

NOTE A - BUDGETARY - GAAP RECONCILIATION

For budgetary financial reporting purposes, the Uniform Massachuset[s Accounting System basis of accounting(established by the Commonwealth) is followed, which differs from the GAAP basis of accounting. Areconciliation of budgetary-basis to GAAP-basis results for the general fund and community preservation fundfor the fiscal year ended June 30, 2013, is presented below:

GenerøI fund

OtherFinancing

Revenues Expenditures Sources (Uses)

Budgetary basis as reported on the schedule ofrevenues, expenditures and changes in fundbalance - budget and actual... fi 50,569,898 $ 57,785,427 fi 1,,657,735

ReclassificationsActivity of stabilization fund recorded in the general fundfor GAAP purposes.....

Activity of OPEB fund recorded in the general fund(26,067)

for GAAP purposes..... 20,372

Budgetary basis as reported on the schedule ofrevenues, expenditures and changes in fundbalance - budget and actual..

- 250,000

- 250,000

AdjustmentsNet change in recording 60-day receipts. . . . . . 86,736

Net change in recording tax refunds payable...... 238,803To record activity for MWPAT subsidies.... 46,536 46,536To record MTRS on-behalf payments......... 2,591,923 2,591,923Net change in recording other expenditures.. .. ..... (10)

- (1,017,e63)

GAAP basis as reported on the statement of revenues,expenditures and changes in fund balances..... S 53,528,201, g 53,405,913 fi 2,'157,735

C ommunity ye s era ati on funil

Expenditures

$ 895,883

AdjustmentsTo record encumbrances and continuing appropriations. . . ... . . . (702,545)

GAAP basis as reported on the statement of revenues,expenditures and changes in fund balances..... $ tga,g38

Tozan of Møshpee, Møssachusetts 62 Re q uir e d S uppl em ent ary Inf o rm øti o n

Notes to Required Supplementary Information For the Fiscal Year Ended June 30, 2013

NOTEB-PENSIONPLAN

Additional information as of the latest actuarial valuation is as follows:

Valuation date: January 1,,20'1,2

Actuarial cost method: Entry age normal cost

Amortization method: Payments increase at6.0% through fiscal year 2015. Thereafter,payments increase at 4.0% , except for 2010 Early Retirement Incentive,which is a level payment.

Remaining amortization period: 26 years from July 1,2012 for 2002 and 2003 Early Retirement Incentives,retiree sheriffs liability and remaining unfunded liability, and 10 yearsfrom fuly '1., 2012 for 2010 Early Retirement Incentive

Asset valuation method: Sum of actuarial value at beginning of year and increase in cost valueduring the year excluding realttzed appreciation or losses plus 20 percentof market value at end of year in excess of that preliminary value,adjusted to be within 20 percent of their market value

Actuarial assumptions:

Investment rate of return: 7.875%

Projected salary increases: Varies by length of service (range of 4.75% - 5.25%)

Cost of living adjustments : 3.0% oÍ first $14,000 of retirement income in fiscal 2013, increasing to$15,000 in fiscal year 2074

Town of Mashpee, Møssøchusetts 63 Re q uire il S upplementøry Information

_________________________

THIS PAGE LEFT BLANK INTENTIONALLY_________________________

PROPOSED FORM OF LEGAL OPINION APPENDIX C

C-1

(Date of Delivery)

Craig Mayen, TreasurerTown of MashpeeMashpee, Massachusetts

$4,672,000Town of Mashpee, Massachusetts

General Obligation Municipal Purpose Loan of 2014 BondsDated January 31, 2014

We have acted as bond counsel to the Town of Mashpee, Massachusetts (the “Town”) inconnection with the issuance by the Town of the above-referenced bonds (the “Bonds”). In suchcapacity, we have examined the law and such certified proceedings and other papers as we havedeemed necessary to render this opinion.

As to questions of fact material to our opinion we have relied upon representations andcovenants of the Town contained in the certified proceedings and other certifications of publicofficials furnished to us, without undertaking to verify the same by independent investigation.

Based on our examination, we are of the opinion, under existing law, as follows:

1. The Bonds are valid and binding general obligations of the Town and, except tothe extent they are paid from other sources, the principal of and interest on the Bonds are payablefrom taxes which may be levied upon all taxable property in the Town, subject to the limitimposed by Chapter 59, Section 21C of the General Laws.

2. Interest on the Bonds is excluded from the gross income of the owners of theBonds for federal income tax purposes. In addition, interest on the Bonds is not a specificpreference item for purposes of the federal individual or corporate alternative minimum taxes.However, such interest is included in adjusted current earnings when calculating corporatealternative minimum taxable income. In rendering the opinions set forth in this paragraph, wehave assumed compliance by the Town with all requirements of the Internal Revenue Code of1986 that must be satisfied subsequent to the issuance of the Bonds in order that interest thereonbe, and continue to be, excluded from gross income for federal income tax purposes. The Townhas covenanted to comply with all such requirements. Failure by the Town to comply withcertain of such requirements may cause interest on the Bonds to become included in grossincome for federal income tax purposes retroactive to the date of issuance of the Bonds. Except

C-2

as expressed in paragraph 4 below, we express no opinion regarding any other federal taxconsequences arising with respect to the Bonds.

3. Interest on the Bonds is exempt from Massachusetts personal income taxes andthe Bonds are exempt from Massachusetts personal property taxes. We express no opinionregarding any other Massachusetts tax consequences arising with respect to the Bonds or any taxconsequences arising with respect to the Bonds under the laws of any state other thanMassachusetts.

4. The Bonds are qualified tax-exempt obligations within the meaning of Section265(b)(3) of the Code.

This opinion is expressed as of the date hereof, and we neither assume nor undertake anyobligation to update, revise, supplement or restate this opinion to reflect any action taken oromitted, or any facts or circumstances or changes in law or in the interpretation thereof, that mayhereafter arise or occur, or for any other reason.

The rights of the holders of the Bonds and the enforceability of the Bonds may be subject tobankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’rights heretofore or hereafter enacted to the extent constitutionally applicable, and theirenforcement may also be subject to the exercise of judicial discretion in appropriate cases.

EDWARDS WILDMAN PALMER LLP

AM 27403728.1

D-1

APPENDIX D

PROPOSED FORM OFCONTINUING DISCLOSURE CERTIFICATE

This Continuing Disclosure Certificate (the “Disclosure Certificate”) is executed anddelivered by the Town of Mashpee, Massachusetts (the “Issuer”) in connection with the issuanceof its $4,672,000 General Obligation Municipal Purpose Loan of 2014 Bonds dated January 21,2014 (the “Bonds”). The Issuer covenants and agrees as follows:

SECTION 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is beingexecuted and delivered by the Issuer for the benefit of the Owners of the Bonds and in order toassist the Participating Underwriters in complying with the Rule.

SECTION 2. Definitions. For purposes of this Disclosure Certificate the followingcapitalized terms shall have the following meanings:

“Annual Report” shall mean any Annual Report provided by the Issuer pursuant to, andas described in, Sections 3 and 4 of this Disclosure Certificate.

“Listed Events” shall mean any of the events listed in Section 5(a) of this DisclosureCertificate.

“MSRB” shall mean the Municipal Securities Rulemaking Board as established pursuantto Section 15B(b)(1) of the Securities Exchange Act of 1934, or any successor thereto or to thefunctions of the MSRB contemplated by this Disclosure Certificate. Filing information relatingto the MSRB is set forth in Exhibit A attached hereto.

“Owners of the Bonds” shall mean the registered owners, including beneficial owners, ofthe Bonds.

“Participating Underwriter” shall mean any of the original underwriters of the Bondsrequired to comply with the Rule in connection with offering of the Bonds.

“Rule” shall mean Rule 15c2-12 adopted by the Securities and Exchange Commissionunder the Securities Exchange Act of 1934, as the same may be amended from time to time.

SECTION 3. Provision of Annual Reports.

(a) The Issuer shall, not later than 270 days after the end of each fiscal year, provideto the MSRB an Annual Report which is consistent with the requirements of Section 4 of thisDisclosure Certificate. The Annual Report may be submitted as a single document or as separatedocuments comprising a package, and may cross-reference other information as provided inSection 4 of this Disclosure Certificate; provided that the audited financial statements of theIssuer may be submitted when available separately from the balance of the Annual Report.

D-2

(b) If the Issuer is unable to provide to the MSRB an Annual Report by the daterequired in subsection (a), the Issuer shall send a notice to the MSRB, in substantially the formattached as Exhibit B.

SECTION 4. Content of Annual Reports. The Issuer's Annual Report shall contain orincorporate by reference the following:

(a) quantitative information for the preceding fiscal year of the type presented in theIssuer's Official Statement dated January _____, 2014 relating to the Bonds regarding (i) therevenues and expenditures of the Issuer relating to its operating budget, (ii) capital expenditures,(iii) fund balances, (iv) property tax information, (v) outstanding indebtedness and overlappingdebt of the Issuer, (vi) pension obligations of the Issuer, and (vii) other post-employment benefitsliability of the Issuer, and

(b) the most recently available audited financial statements of the Issuer, prepared inaccordance with generally accepted accounting principles, with certain exceptions permitted bythe Massachusetts Uniform Municipal Accounting System promulgated by the Department ofRevenue of the Commonwealth. If audited financial statements for the preceding fiscal year arenot available when the Annual Report is submitted, the Annual Report will include unauditedfinancial statements for the preceding fiscal year and audited financial statements for such fiscalyear shall be submitted when available.

Any or all of the items listed above may be incorporated by reference from other documents,including official statements of debt issues of the Issuer or related public entities, which (i) areavailable to the public on the MSRB internet website or (ii) have been filed with the Securitiesand Exchange Commission. The Issuer shall clearly identify each such other document soincorporated by reference.

SECTION 5. Reporting of Significant Events.

(a) The Issuer shall give notice, in accordance with the provisions of this Section 5,of the occurrence of any of the following events with respect to the Bonds:

1. Principal and interest payment delinquencies.

2. Non-payment related defaults, if material.

3. Unscheduled draws on debt service reserves reflecting financial difficulties.

4. Unscheduled draws on credit enhancements reflecting financial difficulties.

5. Substitution of credit or liquidity providers, or their failure to perform.

6. Adverse tax opinions, the issuance by the Internal Revenue Service of proposedor final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or othermaterial notices or determinations with respect to the tax status of the Bonds, or other materialevents affecting the tax status of the Bonds.

D-3

7. Modifications to rights of the Owners of the Bonds, if material.

8. Bond calls, if material, and tender offers.

9. Defeasances.

10. Release, substitution or sale of property securing repayment of the Bonds, ifmaterial.

11. Rating changes.

12. Bankruptcy, insolvency, receivership or similar event of the Issuer.*

13. The consummation of a merger, consolidation, or acquisition involving the Issueror the sale of all or substantially all of the assets of the Issuer, other than in the ordinary courseof business, the entry into a definitive agreement to undertake such an action or the terminationof a definitive agreement relating to any such actions, other than pursuant to its terms, ifmaterial.

14. Appointment of a successor or additional trustee or the change of name of atrustee, if material.

(b) Upon the occurrence of a Listed Event, the Issuer shall, in a timely manner not inexcess of ten (10) business days after the occurrence of the event, file a notice of such occurrencewith the MSRB.

SECTION 6. Transmission of Information and Notices. Unless otherwise required bylaw, all notices, documents and information provided to the MSRB shall be provided inelectronic format as prescribed by the MSRB and shall be accompanied by identifyinginformation as prescribed by the MSRB.

SECTION 7. Termination of Reporting Obligation. The Issuer's obligations under thisDisclosure Certificate shall terminate upon the legal defeasance in accordance with the terms ofthe Bonds, prior redemption or payment in full of all of the Bonds. If such termination occursprior to the final maturity of the Bonds, the Issuer shall give notice of such termination in thesame manner as for a Listed Event under Section 5(b).

SECTION 8. Amendment; Waiver. Notwithstanding any other provision of thisDisclosure Certificate, the Issuer may amend this Disclosure Certificate and any provision of this

* As noted in the Rule, this event is considered to occur when any of the following occur: (i) the appointment of areceiver, fiscal agent or similar officer for the Issuer in a proceeding under the U.S. Bankruptcy Code or in anyproceeding under state or federal law in which a court or governmental authority has assumed jurisdiction oversubstantially all of the assets or business of the Issuer, or if such jurisdiction has been assumed by leaving theexisting governing body and officials or officers in possession but subject to the supervision and orders of a court orgovernmental authority, or (ii) the entry of an order confirming a plan of reorganization, arrangement or liquidationby a court or governmental authority having supervision or jurisdiction over substantially all of the assets orbusiness of the Issuer.

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Disclosure Certificate may be waived if such amendment or waiver is permitted by the Rule, asevidenced by an opinion of counsel expert in federal securities law (which may include bondcounsel to the Issuer), to the effect that such amendment or waiver would not cause theDisclosure Certificate to violate the Rule. The first Annual Report filed after enactment of anyamendment to or waiver of this Disclosure Certificate shall explain, in narrative form, thereasons for the amendment or waiver and the impact of the change in the type of informationbeing provided in the Annual Report.

If the amendment provides for a change in the accounting principles to be followed inpreparing financial statements, the Annual Report for the year in which the change is made shallpresent a comparison between the financial statements or information prepared on the basis ofthe new accounting principles and those prepared on the basis of the former accountingprinciples. The comparison shall include a qualitative discussion of the differences in theaccounting principles and the impact of the change in the accounting principles on thepresentation of the financial information in order to provide information to investors to enablethem to evaluate the ability of the Issuer to meet its obligations. To the extent reasonablyfeasible, the comparison shall also be quantitative. A notice of the change in the accountingprinciples shall be sent to the MSRB.

SECTION 9. Default. In the event of a failure of the Issuer to comply with anyprovision of this Disclosure Certificate any Owner of the Bonds may seek a court order forspecific performance by the Issuer of its obligations under this Disclosure Certificate. A defaultunder this Disclosure Certificate shall not constitute a default with respect to the Bonds, and thesole remedy under this Disclosure Certificate in the event of any failure of the Issuer to complywith this Disclosure Certificate shall be an action for specific performance of the Issuer'sobligations hereunder and not for money damages in any amount.

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SECTION 10. Beneficiaries. This Disclosure Certificate shall inure solely to the benefitof the Owners of the Bonds from time to time, and shall create no rights in any other person orentity.

Date: January _____, 2014 TOWN OF MASHPEE,MASSACHUSETTS

By______________________________Treasurer

______________________________

______________________________

______________________________

______________________________

______________________________Selectmen

[EXHIBIT A: Filing Information for the MSRB][EXHIBIT B: Form of Notice of Failure to File Annual Report]

AM 27403765.1

_________________________

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APPENDIX E

PROPOSAL FOR$4,672,000

Mashpee, MassachusettsGeneral Obligation Municipal Purpose Loan of 2014 Bonds

Bank-Qualified

Sale Date: January 22, 2014Craig Mayen, TreasurerMashpee, Massachusettsc/o Eastern Bank. Municipal Finance Department265 Franklin StreetBoston, Massachusetts 02110

Dear Mr. Mayen:

For all of $4,672,000 Town of Mashpee, Massachusetts, General Obligation Municipal Purpose Loan of 2014 Bonds asfurther described in the Notice of Sale dated January 13, 2014, we bid _________________ and accrued interest, if any, foreach $100 face value of bonds, bearing interest at the rate or rates per annum as follows:

Year Rate Year Rate

2015……………….. % 2023………………. %2016……………….. 2024……………….2017…………….…. 2025……………….2018…………….…. 2026……………….2019…………….…. 2027……………….2020…………….…. 2028……………….2021…………….…. 2029……………….2022………………

TERM BONDS (Optional)

$ _________________ Term Bond maturing on January 15, _________at ________% per annum$ _________________ Term Bond maturing on January 15, _________at ________% per annum

The undersigned hereby acknowledges the receipt of and the opportunity to examine the Preliminary Official Statementaccompanying the said Notice of Sale.

By: ______________________ Telephone: ______________________

Address: ______________________ Fax: ______________________

______________________

The following is our computation of the net interest cost and percent true interest cost, made as provided in the above-mentioned Notice of Sale, for the purchase of $4,672,000 Bonds under the foregoing proposal:

BID MUST INCLUDE A PREMIUM OF AT LEAST $50,000

Gross Interest Cost…………………. $_______________________

Underwriters Premium……………… $_______________________

Net Interest Cost……………………. $_______________________

Percent True Interest Cost………….. _______________________%

(four decimals)

The Municipal Finance Department of Eastern Bank will assist in submitting bids on this issue, if desired. Please sign ablank bid form and mail to the above address or fax in advance of the sale to: (617) 235-8110; or telephone final figures to usat (617) 235-8104 or 235-8106 approximately one-half hour prior to the sale. Bidders are responsible for any error in bids

submitted in this manner.

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