VILLAGE OF GRAFTON NOTES TO FINANCIAL STATEMENTS As of and for the Year Ended December 31, 2016 NOTE IV - OTHER INFORMATION (cont.) C. COMMITMENTS AND CONTINGENCIES (cont.) During 2014, the village had signed a commitment under a service agreement with Utility Service Co., LLC related to their water tank maintenance which provides for payments ranging from $31,756 to $73,818 per year through 2027. Total amount of payments over the life of contract total $687,486. From time to time, the village is party to various pending claims and legal proceedings. Although the outcome of such matters cannot be forecasted with certainty, it is the opinion of management and the village attorney that the likelihood is remote that any such claims or proceedings will have a material adverse effect on the village's financial position or results of operations. The village has received federal and state grants for specific purposes that are subject to review and audit by the grantor agencies. Such audits could lead to requests for reimbursements to the grantor agency for expenditures disallowed under terms of the grants. Management believes such disallowances, if any, would be immaterial. The Village collects impact fees for the purpose of providing for the construction, expansion and improvement of Village parks. The fees are collected and recorded as revenue in the Park and Recreational Facilities Fund. The cash collections are held in an interest-bearing bank account. Total collections for 2016 were $334,796. The fund balance as of December 31, 2016 is $394,743. The Village also collects impact fees for the retirement of debt incurred to construct and improve the fire station, the police facility, the public works facility, and the library. These fees are collected and recorded as revenue in the impact fee debt service fund. The cash collections were held in an interest bearing account. Total collections for 2016 were $169,090. The fund balance as of December 31, 2016 is $0. The fees are to be used to fund specific projects within a specific period of time. In the event the projects are not completed or the time period elapses, the Village will be required to refund the impact fees to the owners of the property on which the fees were originally charged. 86