2016-11-10T11:59:30-06:00 2015-12-31 550486667 ARNETT CARBIS TOOTHMAN LLP 5700 CORPORATE DRIVE STE 650 PITTSBURGH PA 15237 990 2015-01-01 231857015 DIAKON LUTHERAN SOCIAL MINISTRIES DIAK 6106821262 798 HAUSMAN ROAD ALLENTOWN PA 18104 SCOTT HABECKER EXEC VP/CHIEF OP & FIN OFFICER 6106821262 2016-11-08 1 JEFFREY J PETRELL CPA P00138808 4126356270 2016-11-07 2015 2017-02-10 21:41:12Z MARK T PILE 798 HAUSMAN ROAD ALLENTOWN PA 18104 221253799 0 9386 X WWW.DIAKON.ORG X 1868 PA THE ORGANIZATION IS A PROVIDER OF SENIOR LIVING SERVICES AND HUD HOUSING IN PENNSYLVANIA AND MARYLAND AND MANAGES PENNSYLVANIA'S STATEWIDE ADOPTION AND PERMANENCY NETWORK. 9 9 2632 711 54534 -35401 12948745 3522834 195685737 197727350 8968242 8084586 1397775 1688558 219000499 211023328 175958 358456 0 0 66239961 61772097 59500 51175 1664465 146236248 142391485 212711667 204573213 6288832 6450115 439927163 440918012 398095811 421699779 41831352 19218233 X IN RESPONSE TO GOD'S LOVE IN JESUS CHRIST, DIAKON LUTHERAN SOCIAL MINISTRIES WILL DEMONSTRATE GOD'S COMMAND TO LOVE THE NEIGHBOR THROUGH ACTS OF SERVICE. 0 0 130501962 53534 139836730 SENIOR LIVING SERVICESMOST OF DLSM'S SENIOR LIVING COMMUNITIES OFFER A CONTINUUM OF SERVICES FOR OLDER ADULTS INCLUDING RESIDENTIAL ACCOMMODATIONS, PERSONAL CARE SERVICES, AND SKILLED NURSING AND REHABILITATIVE CARE.SENIOR LIVING SERVICES IN PENNSYLVANIA PROVIDED $14,072,166 IN UNCOMPENSATED CARE DURING 2015, DIVIDED BETWEEN COSTS IN EXCESS OF MEDICAL ASSISTANCE REIMBURSEMENT AND CARE FOR PEOPLE WHO HAVE EXHAUSTED THEIR FINANCIAL RESOURCES. 2054524 933470 HUD HOUSINGDLSM OFFERS AFFORDABLE, EQUAL OPPORTUNITY SENIOR HOUSING ACCOMMODATIONS. IN 2015 DLSM PROVIDED 83,947 DAYS OF ACCOMMODATION, FOR AN OCCUPANCY RATE OF 97.9%. 51788773 52281800 STATEWIDE ADOPTION NETWORKPENNSYLVANIA'S STATEWIDE ADOPTION AND PERMANENCY NETWORK (SWAN) IS BOTH A BROAD-BASED COOPERATIVE EFFORT AND A CENTRALIZED INFORMATION AND FACILITATION SERVICE FUNDED AND OVERSEEN BY THE PENNSYLVANIA DEPARTMENT OF HUMAN SERVICES AND MANAGED UNDER CONTRACT BY DIAKON LUTHERAN SOCIAL MINISTRIES.THE SWAN PROGRAM SERVES CHILDREN AND YOUTHS IN THE CUSTODY OF COUNTY CHILDREN AND YOUTH AGENCIES. SWAN MANAGES REFERRALS FROM COUNTY CHILDREN AND YOUTH AGENCIES, CONTRACTS WITH PRIVATE AGENCIES THAT WORK WITH COUNTIES TO PROVIDE DIRECT SERVICES TO CHILDREN AND FAMILIES, PROVIDES CONSULTATION AND TRAINING FOR COUNTY AGENCIES AND PRIVATE PROVIDERS, DEVELOPS CONFERENCES AND REGIONAL MEETINGS, AND MANAGES SUPPORT SERVICES TO ENHANCE THE EFFECTIVENESS OF THE CHILD-PLACEMENT NETWORK. 767231 304922 6306050 OTHER PROGRAMS 767231 304922 6306050 185112490 1 1 0 1 0 0 0 0 0 1 1 0 0 1 1 1 0 1 0 0 0 0 0 1 0 0 0 1 1 1 1 0 0 0 0 0 0 0 0 0 0 1 0 0 0 1 1 1 1 0 0 1 332 0 2632 1 1 1 0 0 0 0 0 0 0 0 0 X 9 9 0 0 0 0 1 1 1 1 1 0 0 1 1 1 1 1 1 1 1 1 1 MD PA X SCOTT HABECKER 7177950342 1022 N UNION STREET MIDDLETOWN PA 17057 X REV DR DON MAIN CHAIR 1.00 1.00 X X 0 0 0 BARBARA FEEGE VICE CHAIR 1.00 X X 0 0 0 REV CHAD HEBRINK TREASURER 1.00 X X 0 0 0 DR BARRY PARKS SECRETARY 1.00 X X 0 0 0 BISHOP SAM ZEISER BOARD MEMBER 1.00 X 0 0 0 MAURICE BOBST BOARD MEMBER 1.00 4.00 X 0 0 0 JENNIFER SCHLEGEL BOARD MEMBER 1.00 X 0 0 0 LARRY DELP BOARD MEMBER 1.00 1.00 X 0 0 0 SUSAN SCHELLENBERG BOARD MEMBER 1.00 3.00 X 0 0 0 MARK T PILE PRESIDENT/CEO 16.00 21.50 X 449137 0 294611 SCOTT HABECKER EXEC VP/CHIEF OP & FINANCIAL OFFICER 29.30 8.20 X 556371 0 91919 RICHARD M BARGER EXEC VP/TREASURER 23.70 6.30 X 230585 0 59779 MARY ELLEN DICKEY SENIOR VP, ADVANCEMENT 0.00 37.50 X 201159 0 23514 RICHARD H REED SENIOR VP, CHIEF RISK OFFICER 24.00 13.50 X 262501 0 7387 DEANNA L ZIEMBA SENIOR VP, SR LVNG OP & BUS DEV 33.30 4.20 X 245202 0 17298 ALICE M CLARK SENIOR VP, HUMAN RESOURCES 34.00 3.50 X 182956 0 19691 SHARI EVELYN VANDERGAST SENIOR VP, CHILD FAM & CHIEF COMP OFF 11.30 26.20 X 235600 0 11528 JARROD E LEO SENIOR VP, FINANCIAL PLANNING OPS 27.80 9.70 X 206732 0 13205 WILLIAM E SWANGER SENIOR VP, CORPORATE COMMUNICATI 12.00 25.50 X 158723 0 19253 LAUREN R CONZAMAN VP, CHILD & FAMILY MINISTR 19.50 18.00 X 142820 0 14024 KATHLEEN JEAN DERLETH VP, CLINICAL SERVICES 33.30 4.20 X 154982 0 20003 HELEN GODFREY REG IL SALES & MKTG DIRECTOR 34.00 3.50 X 144589 0 8727 JAN BIGELOW EXEUCTIVE DIRECTOR I 37.50 X 134272 0 16940 3305629 0 617879 28 0 1 0 MORRISON MANAGEMENT SPECIALIST PO BOX 102289 ATLANTA GA 30368 CULINARY/HOUSEKEEPING 23729627 FAMILY DESIGN RESOURCES INC 471 JPL WICK DRIVE HARRISBURG PA 17111 SWAN PROGRAM SERVICE 15935618 GENESIS ELDERCARE PO BOX 821322 PHILADELPHIA PA 19182 REHAB SERVICES 7151427 BENCHMARK CONSTRUCTION CO INC 4121 ORGEON PIKE BROWNSTOWN PA 17508 CONSTRUCTION 6889864 PRELUDE SYSTEMS 5095 RITTER ROAD SUITE 112 MECHANICSBURG PA 17055 IT SUPPORT 3066821 50 1166550 2356284 3522834 SENIOR LIVING SERVICES 623000 139548475 139548475 STATEWIDE ADOPTION AND PERMANENCY 900099 52281800 52281800 OTHER PROGRAM SERVICES 900099 4980571 4980571 HOUSING URBAN DEVELOPMENT 900099 916504 916504 197727350 6425375 35 6425340 42432 42432 869547 896858 -27311 -27311 -30670 3359 9639667 1310725 8333613 1000000 1306054 310725 1616779 1616779 TRUST INCOME 900099 1243576 1243576 OTHER REVENUE 900099 449037 363868 85169 VENDING REVENUE 900099 23256 23256 1715869 211023328 199358050 54534 8087910 304922 304922 53534 53534 3066125 2848061 218064 49504046 43407355 5442151 654540 -549600 -426196 -112730 -10674 6069638 5430404 566192 73042 3681888 3098164 525323 58401 151298 151298 428044 5335 422709 71504 71504 51000 51000 51175 51175 156872 106623 50249 10469539 9341913 1116410 11216 872028 754188 112474 5366 10780209 9554645 1044168 181396 3613703 177426 3408256 28021 9979048 9612694 366354 1533593 1096143 385966 51484 103978 9447 86714 7817 11807111 11724580 82531 16438203 16195987 242216 1964967 1180323 781925 2719 SWAN CONTRACTED SERVICE 46331290 46331290 CULINARY SERVICE 16428547 16428547 HOUSEKEEPING SERVICES 4874985 4813661 61324 PA NH ASSESSMENT FEE 2038138 2038138 4297428 3650565 365965 280898 204573213 185112490 17796258 1664465 2357284 2968177 31518923 22567305 3102672 1167076 13167203 45312409 1574581 1640884 435848447 216439519 221190700 219408928 117738012 98268298 4572283 4572283 44705505 45012652 439927163 440918012 22702108 38431807 52747449 54969832 232321553 234708363 11167869 17865835 79156832 75723942 398095811 421699779 X -11746311 -28700296 9076339 8403476 44501324 39515053 41831352 19218233 439927163 440918012 X 6450115 -9530539 -19532695 X X 0 1 X 1 1 1 X 6873675 5597588 6514090 12948745 3522834 35456932 202383641 189738873 189921646 195634625 197727350 975406135 209257316 195336461 196435736 208583370 201250184 1010863067 0 0 0 1010863067 2788038 4337908 3862220 5011055 7337354 23336575 2788038 4337908 3862220 5011055 7337354 23336575 1073848 1081634 1382232 1438896 1715869 6692479 213119202 200756003 201680188 215033321 210303407 1040892121 0.97120 0.97510 0.02240 0.01900 X SCHEDULE A, PART III, LINE 12, EXPLANATION OF OTHER INCOME: TRUST INCOME - 2011 AMOUNT: $ 935,079. 2012 AMOUNT: $ 1,009,378. 2013 AMOUNT: $ 1,006,824. 2014 AMOUNT: $ 1,162,676. 2015 AMOUNT: $ 1,243,576. OTHER REVENUE - 2011 AMOUNT: $ 110,230. 2012 AMOUNT: $ 47,373. 2013 AMOUNT: $ 349,982. 2014 AMOUNT: $ 252,378. 2015 AMOUNT: $ 449,037. VENDING REVENUE - 2011 AMOUNT: $ 28,539. 2012 AMOUNT: $ 24,883. 2013 AMOUNT: $ 25,426. 2014 AMOUNT: $ 23,842. 2015 AMOUNT: $ 23,256. RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 0 1 0 1 1 0 1 57148 0 0 57148 0 PART II-B, LINE 1: IN 2015, DIAKON LUTHERAN SOCIAL MINISTRIES ENGAGED J.M. ULIANA & ASSOCIATES, LLC TO CONDUCT LOBBYING ACTIVITIES RELATED TO STATE LEGISLATION AFFECTING LONG-TERM CARE AND HEALTH AND SOCIAL SERVICE PROGRAMS. PAYMENTS TO J.M. ULIANA & ASSOCIATES, LLC, AND AMOUNTS PAID TO DIAKON LUTHERAN SOCIAL MINISTRIES' STAFF TOTALED $57,148. SCHEDULE C, PART II-B, 1D AND 1E AMOUNTS PAID FOR MAILINGS AND PUBLICATIONS WERE NOMINAL. SCHEDULE C, PART II-B, 1G LETTERS, EMAILS, PHONE CALLS ARE MADE TO LEGISLATORS WHEN DLSM NEEDS TO CONTACT LEGISLATORS TO SPEAK ON SUPPORT OF ANY BUDGET ITEMS OR SENATE BILLS TO BE PASSED RELATED TO LONG-TERM CARE AND HEALTH AND SOCIAL SERVICE PROGRAMS. HANDOUTS ARE CREATED BY OUR COMMUNICATIONS DEPARTMENT FOR LOBBYING VISITS THAT THE DLSM STAFF ATTEND. 20049548 395464 225342 688008 19982346 18077169 1781225 747844 556690 20049548 14858797 510296 3275209 567133 18077169 12688497 1006120 1694788 530608 14858797 12149764 1024585 -69426 416396 12688527 1.00000 0 1 1 16441934 16441934 321631787 157116766 164515021 35887 31279 4608 59252242 43425857 15826385 38486597 15865617 22620980 219408928 BENEFICIAL INTEREST IN TRUST 26155364 ESTIMATED THIRD PARTY SETTLEMENT 309186 INVESTMENT IN JOINT VENTURES 440957 DEFERRED BOND ISSUANCE COSTS 3165417 OTHER ASSETS 401420 DUE FROM AFFILIATES 2881694 LEASE RECEIVABLE 11658614 45012652 ESTIMATED THIRD-PARTY PAYOR SETTLEMENTS 519385 MINIMUM PENSION LIABILITY 33727492 INTEREST RATE SWAP AGREEMENT 8778190 RESIDENT DEPOSITS 614487 OTHER LONG TERM LIABILITIES 443087 REFUNDABLE ENTRANCE FEE LIABILITY 31641301 75723942 X PART V, LINE 4: THE INTENDED USES OF THE ORGANIZATION'S ENDOWMNENT FUNDS ARE 1) BENEVOLENT CARE, 2) EXPANSION OF PROGRAMS, AND 3) TO SUPPORT CURRENT PROGRAMS AND ACTIVITIES. SCHEDULE D, PART V COLUMN (B), PRIOR YEAR, LINE 1B HAS BEEN RESTATED FROM $5,521,787 TO $1,781,225 AS A RESULT OF A RESTATEMENT OF THE 2014 FINANCIAL STATEMENTS DUE TO A CLARIFICATION FROM THE COMMONWEALTH OF PENNSYLVANIA'S ATTORNEY GENERAL'S OFFICE REGARDING A CHARITABLE CONTRIBUTION THAT WAS ORIGINALLY CHARACTERIZED AS PERMANENTLY RESTRICTED BUT SUBSEQUENTLY DETERMINED TO BE 50% UNRESTRICTED AND 50% PERMANENTLY RESTRICTED. PART X, LINE 2: DIAKON AND ITS CONTROLLED AFFILIATES, WITH THE EXCEPTION OF ISM, A PENNSYLVANIA FOR-PROFIT CORPORATION, ARE NOT-FOR-PROFIT CORPORATIONS AS DESCRIBED IN SECTION 501(C)(3) OF THE INTERNAL REVENUE CODE AND ARE EXEMPT FROM FEDERAL INCOME TAXES UNDER 501(A) OF THE CODE. THE CORPORATION USES A THRESHOLD OF MORE LIKELY THAN NOT FOR RECOGNITION AND DERECOGNITION OF TAX POSITIONS TAKEN OR EXPECTED TO BE TAKEN IN A TAX RETURN. THE CORPORATION DOES NOT BELIEVE THAT THERE ARE ANY UNRECOGNIZED TAX BENEFITS OR LIABILITIES THAT SHOULD BE RECORDED. X X X X X X 1 COREMESSAGINK 334 VALLEYBROOK DRIVE LANCASTER PA 17601 DIRECT MAILING 0 92629 51175 41454 92629 51175 41454 MD PA 1 DIAKON CHILD FAMILY AND COMMUNITY MINISTRIES 798 HAUSMAN ROAD STE 300 ALLENTOWN PA 18104 465390969 501(C)(3) 300000 FUND CHILDREN PROGRAMS 1 BENEVOLENT CARE TO INDIVIDUALS AT UNRELATED INSTITUTIONS 2 53534 PART I, LINE 2: DIAKON LUTHERAN SOCIAL MINISTRIES' GRANT REVIEW PROCESS INCLUDES ANNUAL VISITS AND REVIEW OF GRANTEE BUDGETS. DLSM DOES NOT PROVIDE A SIGNIFICANT NUMBER OF GRANTS AND, THEREFORE, DOES NOT REQUIRE DETAILED MONITORING OF THE USE OF GRANT FUNDS. X X X X X 1 1 0 0 0 0 0 1 0 MARK T PILE PRESIDENT/CEO 394623 0 50150 0 4364 0 272834 0 21777 0 743748 0 0 0 SCOTT HABECKER EXEC VP/CHIEF OP & FINANCIAL OFFICER 295961 0 72650 0 187760 0 70909 0 21010 0 648290 0 114431 0 RICHARD M BARGER EXEC VP/TREASURER 228857 0 647 0 1081 0 43884 0 15895 0 290364 0 0 0 MARY ELLEN DICKEY SENIOR VP, ADVANCEMENT 193787 0 1860 0 5512 0 0 0 23514 0 224673 0 0 0 RICHARD H REED SENIOR VP, CHIEF RISK OFFICER 185759 0 1224 0 75518 0 0 0 7387 0 269888 0 0 0 DEANNA L ZIEMBA SENIOR VP, SR LVNG OP & BUS DEV 224558 0 20560 0 84 0 0 0 17298 0 262500 0 0 0 ALICE M CLARK SENIOR VP, HUMAN RESOURCES 181976 0 980 0 0 0 0 0 19691 0 202647 0 0 0 SHARI EVELYN VANDERGAST SENIOR VP, CHILD FAM & CHIEF COMP OF 223908 0 5000 0 6692 0 0 0 11528 0 247128 0 0 0 JARROD E LEO SENIOR VP, FINANCIAL PLANNING OPS 206732 0 0 0 0 0 0 0 13205 0 219937 0 0 0 WILLIAM E SWANGER SENIOR VP, CORPORATE COMMUNICATI 157912 0 811 0 0 0 0 0 19253 0 177976 0 0 0 LAUREN R CONZAMAN VP, CHILD & FAMILY MINISTR 111009 0 838 0 30973 0 0 0 14024 0 156844 0 0 0 KATHLEEN JEAN DERLETH VP, CLINICAL SERVICES 153393 0 350 0 1239 0 0 0 20003 0 174985 0 0 0 HELEN GODFREY REG IL SALES & MKTG DIRECTOR 108223 0 36366 0 0 0 0 0 8727 0 153316 0 0 0 JAN BIGELOW EXEUCTIVE DIRECTOR I 133469 0 803 0 0 0 0 0 16940 0 151212 0 0 0 PART I, LINE 3 SEE SCHEDULE O IN REFERENCE TO PART VI, SECTION B, LINE 15 FOR A DETAILED DESCRIPTION OF THE ORGANIZATION'S EXECUTIVE COMPENSATION POLICY. PART I, LINES 4A-B SCHEDULE J, PART I, QUESTION 4A THE FOLLOWING INDIVIDUALS RECEIVED A SEVERANCE PAYMENT: RICHARD H. REED - 73,997 LAUREN R. CONZAMAN - 29,325 SCHEDULE J, PART I, QUESTION 4B ONE OFFICER WAS OFFERED AND SIGNED AN AGREEMENT WHICH INCLUDES A 457(F) SUPPLEMENTAL NONQUALIFIED BENEFIT. THE EFFECTIVE DATE WAS DECEMBER 7, 2012. THIS BENEFIT WAS ADDED TO RECOGNIZE THE SIGNIFICANT CONTRIBUTIONS OF THE IDENTIFIED OFFICER, AND IN CONSIDERATION OF EXPECTED CONTRIBUTION TO THE GROWTH OF DLSM, ITS AFFILIATES AND SUBSIDIARIES IN THE FUTURE. THE ANNUAL ACCRUALS AND INTEREST EARNINGS FOR THE 457(F) SUPPLEMENTAL NONQUALIFIED BENEFIT PLAN IS REPORTED IN PART VII, SECTION A, COLUMN F AND SCHEDULE J, PART II, COLUMN C AND IS LISTED BELOW: SCOTT D. HABECKER $70,909 AS A CONDITION FOR PARTICIPATING IN THE 457(F) SUPPLEMENTAL NON QUALIFIED BENEFIT PLAN, THE OFFICER MUST BE EMPLOYED AT THE VESTING DATE AND HAVE AGREED TO CERTAIN RESTRICTIVE COVENANTS. THE OFFICER REACHED THE VESTING DATE AND RECEIVED A PAYOUT OF THE ACCRUED BENEFIT AND INTEREST WHICH IS INCLUDED IN REPORTABLE COMPENSATION IN PART VII, SECTION A AND SCHEDULE J, PART II, COLUMN B (III) AND IS LISTED BELOW: SCOTT D. HABECKER $180,375 SUPPLEMENTAL RETIREMENT PLAN (SERP) DLSM'S BOARD OF DIRECTORS HAS ESTABLISHED A SERP, WHICH IS A NONQUALIFIED DEFINED BENEFIT PLAN, UNDER WHICH DLSM MAY PAY SUPPLEMENTAL RETIREMENT BENEFITS TO KEY EXECUTIVES IN ADDITION TO THE ACCRUED BENEFIT AMOUNTS UNDER THE DLSM PENSION PLAN. THE SERP WAS ADDED TO PROVIDE EQUITABLE AND COMPETITIVE POST RETIREMENT INCOME FOR BOARD SELECTED SENIOR EXECUTIVES, WHICH CURRENTLY INCLUDES THE CEO. THE 2015 ANNUAL COST ACCRUED FOR THIS PLAN IS NOTED IN SCHEDULE J, PART II, COLUMN C AS LISTED BELOW: MARK T. PILE $272,834 THE SERP IS NOT FUNDED AND THE LIABILITY FOR THIS PLAN WAS $451,538 AT DECEMBER 31, 2015. AS A CONDITION FOR PARTICIPATING IN THE SERP, THE EXECUTIVE MUST BE EMPLOYED AT THE VESTING DATE AND HAVE AGREED TO CERTAIN RESTRICTIVE COVENANTS. PART I, LINE 7 THE COMPENSATION COMMITTEE OF THE DIAKON BOARD REVIEWS THE PERFORMANCE OF THE CEO ON AN ANNUAL BASIS. DURING THE FIRST QUARTER OF 2015 THE CHAIR OF THE COMPENSATION COMMITTEE PROVIDED A SUMMARY OF THE CEO'S PERFORMANCE FOR 2014 AND INDICATED THE BOARD APPROVED FOR MARK PILE, CEO/PRESIDENT, A PAYMENT OF $50,000 IN RECOGNITION OF HIS PERFORMANCE SINCE ASSUMING THE ROLE OF CEO. THE EMPLOYMENT AGREEMENT FOR THE CHIEF OPERATING AND FINANCIAL OFFICER INCLUDES A PROVISION FOR AN ANNUAL INCENTIVE COMPENSATION IN AN AMOUNT UP TO 25% OF HIS BASE COMPENSATION, BASED UPON ACHIEVEMENT OF MUTUALLY ESTABLISHED ANNUAL GOALS AND OBJECTIVES AND A REVIEW OF THE CFO'S ACCOMPLISHMENTS FOR THE PRIOR CALENDAR YEAR. THE CEO/PRESIDENT CONDUCTS AN ANNUAL REVIEW AT THE BEGINNING OF EACH YEAR FOR THE PRIOR YEAR (ANNUAL BASIS) AND DETERMINES THE AMOUNT UP TO 25% FOR PAYMENT. A CUMBERLAND COUNTY MUNICIPAL AUTHORITY 236003119 230614CK3 2007-01-30 63635926 SEE PART VI 1 0 0 B CUMBERLAND COUNTY MUNICIPAL AUTHORITY 236003119 230614EK1 2009-12-10 122154764 SEE PART VI 1 0 0 C PART VI 236003119 230614GTO 2014-04-29 71341000 SEE PART VI 0 0 0 D CUMBERLAND COUNTY MUNICIPAL AUTHORITY 236003119 230614HL6 2015-06-04 156104916 SEE PART VI 0 0 0 A 61955000 70193536 9187756 6112320 1051817 53801643 40000 2012 1 0 1 1 B 26740000 87325000 123245049 967348 2193720 11216062 1988038 31057949 76789281 2013 1 0 1 1 C 2229000 71341920 1035516 172208 25175565 45130839 2015 1 0 1 1 D 156104916 154470085 1634830 2015 0 1 1 1 A 0 1 1 1 0 0.00450 0.00020 0.00470 0 0 1 B 0 1 1 1 0 0.00110 0.00170 0.00280 0 0 1 C 0 1 1 1 0 0.00470 0.00250 0.00720 0 0 1 D 0 1 1 1 0 0.00210 0.00230 0.00440 0 0 1 A 0 0 0 1 0 0 0 1 1 B 0 0 0 1 0 0 0 1 1 C 0 0 0 1 1 1 WELLS FARGOPNC 5.333333300000 0 0 0 1 1 D 0 0 0 1 0 0 0 1 1 A 1 B 1 C 1 D 1 PART I PART A LINE F BOND A: DESCRIPTION OF PURPOSE - THE 2007A BONDS WERE ISSUED BY THE AUTHORITY TO FINANCE A PROJECT FOR THE BENEFIT OF DLSM COMPRISED OF, AMONG OTHER THINGS, (1) THE ACQUISITION, CONSTRUCTION RENOVATION, IMPROVEMENT AND EQUIPPING OF EXISTING SKILLED NURSING, ASSISTED LIVING AND INDEPENDENT LIVING FACILITIES; AND (2) THE PAYMENT OF A PORTION OF THE COSTS AND EXPENSES OF ISSUING THE BONDS. NO ARBITRAGE LIABILITY EXISTED FOR THE BONDS AS OF THE JANUARY 31, 2016 INSTALLMENT COMPUTATION DATE. THE NEXT COMPUTATION DATE IS JANUARY 31, 2017. A REFUNDING ESCROW WAS ESTABLISHED WITH PROCEEDS FROM BOND D TOTAL PROCEEDS OF ISSUE ISSUE PRICE $63,635,926 CUMULATIVE EARNINGS 6,557,610 TOTAL $70,193,536 BOND B: DESCRIPTION OF PURPOSE - THE 2009 BONDS WERE ISSUED BY THE AUTHORITY TO FINANCE A PROJECT FOR THE BENEFIT OF DLSM COMPRISED OF, AMONG OTHER THINGS, (1) THE REFUNDING OF THE AUTHORITY'S REVENUE BONDS SERIES D OF 2003; (2) THE REFUNDING OF THE AUTHORITY'S VARIABLE RATE REVENUE BONDS, SERIES B OF 2007; (3) THE ACQUISITION, CONSTRUCTION, RENOVATION, IMPROVEMENT AND EQUIPPING OF ADMINISTRATIVE, SKILLED NURSING, ASSISTED LIVING AND INDEPENDENT LIVING FACILITIES; (4) THE FUNDING OF A DEBT SERVICE RESERVE FUND FOR THE BONDS; (5) PAYMENT OF ONE OR MORE TERMINATION PAYMENTS WITH RESPECT TO CERTAIN OUTSTANDING INTEREST RATE MANAGEMENT AGREEMENTS; (6) THE PAYMENT OF THE COSTS AND EXPENSES INCIDENT TO THE ISSUANCE OF THE BONDS. NO ARBITRAGE LIABILITY EXISTED FOR THE BONDS AS OF THE DECEMBER 1, 2015 INSTALLMENT COMPUTATION DATE. THE NEXT COMPUTATION DATE IS DECEMBER 1, 2016. A REFUNDING ESCROW WAS ESTABLISHED WITH THE PROCEEDS FROM BOND D. THE OUTSTANDING BALANCE OF THE BONDS NOT LEGALLY DEFEASED IS $9,690,000. TOTAL PROCEEDS OF ISSUE ISSUE PRICE $122,154,764 CUMULATIVE EARNINGS $1,090,285 TOTAL $123,245,049 BOND C (SERIES A & B ISSUED THROUGH CUMBERLAND COUNTY MUNICIPAL AUTHORITY EIN 23-6003119, SERIES C ISSUED THROUGH COUNTY COMMISSIONERS OF WASHINGTON COUNTY EIN 52-601037) DESCRIPTION OF PURPOSE (SERIES A & B) - THE 2014 BONDS WERE ISSUED BY THE AUTHORITY TO FINANCE A PROJECT FOR THE BENEFIT OF DLSM COMPRISED OF, AMONG OTHER THINGS, (1) THE REFUNDING OF THE AUTHORITY'S VARIABLE RATE DEMAND BONDS SERIES A AND C OF 2003 (2) THE REFUNDING OF A PORTION OF THE AUTHORITY'S REVENUE BONDS SERIES OF 2009, (3) THE ACQUISITION, CONSTRUCTION RENOVATION, IMPROVEMENT AND EQUIPPING OF ADMINISTRATIVE, SKILLED NURSING, PERSONAL CARE AND INDEPENDENT LIVING FACILITIES, (4) THE PAYMENT OF THE COSTS AND EXPENSES INCIDENT TO THE ISSUANCE OF THE BONDS. ISSUE PRICE (SERIES A AND B) $52,543,000 CUMULATIVE EARNINGS 920 TOTAL $52,543,920 DESCRIPTION OF PURPOSE (SERIES C) - TO REFUND ALL OF A PORTION OF THE OUTSTANDING WASHINGTON COUNTY MARYLAND VARIABLE RATE DEMAND BONDS, SERIES E OF 2003 (2) TO FINANCE OR REIMBURSE COSTS OF ISSUING THE BONDS. ISSUE PRICE (SERIES C) $18,798,000 BOND D: DESCRIPTION OF PURPOSE - THE 2015 BONDS WERE ISSUED BY THE AUTHORITY TO PROVIDE FUNDS TO UNDERTAKE A PROJECT CONSISTING OF, (1) THE ADVANCE REFUNDING OF THE AUTHORITY'S REVENUE BONDS SERIES A OF 2007, (2) THE ADVANCE REFUNDING OF A PORTION OF THE AUTHORITY'S REVENUE BONDS, SERIES OF 2009 AND (3) THE PAYMENT OF COSTS AND EXPENSES OF THE ISSUING OF THE SERIES OF 2015 BONDS. ISSUE PRICE $154,104,916 X 1367 FMV X 29414 FMV X 1 1800 FMV X 14 1043 FMV X 62 1797 FMV X CUSTOM IMPROVEMENTS 10 114894 FMV X GIFT CERTIFICATE 147 23182 FMV X FURNITURE & EQUIPMENT 38 12774 FMV X JEWELRY 26 9786 FMV X GIFT BASKETS 45 3478 FMV X TOYS 3 500 FMV 0 0 0 FORM 990, PART VI, SECTION A, LINE 6 THE SOLE MEMBER OF DLSM IS DIAKON, A PENNSYLVANIA NON-PROFIT CORPORATION. FORM 990, PART VI, SECTION A, LINE 7A A MAJORITY OF THE MEMBERS OF THE GOVERNING BODY (THE DLSM BOARD OF DIRECTORS) ARE ELECTED BY A MAJORITY VOTE OF THE BISHOPS OF THE FOLLOWING SYNODS OF THE EVANGELICAL LUTHERAN CHURCH IN AMERICA: NORTHEASTERN PENNSYLVANIA SYNOD, SOUTHEASTERN PENNSYLVANIA SYNOD, DELAWARE-MARYLAND SYNOD, UPPER SUSQUEHANNA SYNOD, AND LOWER SUSQUEHANNA SYNOD. THE REMAINING MEMBERS OF THE BOARD ARE ELECTED BY THE BOARD FROM A SLATE OF CANDIDATES PRESENTED BY THE BOARD DEVELOPMENT COMMITTEE. FORM 990, PART VI, SECTION A, LINE 7B THE SOLE MEMBER OF DLSM IS DIAKON, A PENNSYLVANIA NON-PROFIT CORPORATION. DIAKON HAS THE APPROVAL RIGHTS, SPECIFIED IN BOTH THE DLSM AND DIAKON BY-LAWS, OVER CERTAIN TYPES OF ACTIONS BY DLSM'S GOVERNING BODY. FORM 990, PART VI, SECTION B, LINE 11 DIAKON LUTHERAN SOCIAL MINISTRIES HAS A CPA FIRM PREPARE ITS FORM 990. THE RETURN IS COMPLETED IN DRAFT FORM AND REVIEWED BY MANAGEMENT OF THE ORGANIZATION. THE RETURN IS THEN FINALIZED AND THE BOARD IS PROVIDED A COPY OF THE FORM 990 BEFORE IT IS FILED. FORM 990, PART VI, SECTION B, LINE 12C THE COMPLIANCE OFFICER OF THE ORGANIZATION REVIEWS DLSM'S CONFLICT OF INTEREST STATEMENT AND CERTIFICATION FORMS WITH THE BOARD ON A REGULAR BASIS. ALL BOARD MEMBERS AND ALL OFFICERS AND KEY EMPLOYEES ARE REQUIRED TO COMPLETE A CERTIFICATION FORM AND DISCLOSE POSSIBLE OR ACTUAL CONFLICTS OF INTEREST. THE COMPLETED FORMS ARE REVIEWED BY THE COMPLIANCE OFFICER AND BY THE ORGANIZATION'S OUTSIDE AUDITOR ON A REGULAR BASIS. FORM 990, PART VI, SECTION B, LINE 15 EXECUTIVE COMPENSATION PHILOSOPHY A COMPENSATION COMMITTEE OF INDEPENDENT DIRECTORS OF THE SOLE MEMBER, WHICH INCLUDES DIRECTORS FROM DLSM (COMPENSATION COMMITTEE), UTILIZES EXTERNAL CONSULTANTS TO ASSIST WITH THE DEVELOPMENT, ADMINISTRATION, AND DETERMINATION OF COMPENSATION, WELFARE, BENEFIT, PENSION AND OTHER PLANS, WHICH TAKE INTO ACCOUNT APPROPRIATE INDUSTRY BENCHMARKS AND THE COMPENSATION POLICIES FOLLOWED BY ORGANIZATIONS SIMILARLY SITUATED TO DLSM. THE BOARD COMPENSATION COMMITTEE HAS ADOPTED A WRITTEN "CHARTER," WHICH SETS FORTH THE PURPOSE, MEMBERSHIP AND RESPONSIBILITIES OF THE COMMITTEE. IN ADDITION, IT CONDUCTS ITS ACTIVITIES IN COMPLIANCE WITH DLSM'S "EXCESS BENEFITS TRANSACTION" POLICY, WHICH REQUIRES REVIEW AND APPROVAL BY INDEPENDENT PERSONS, COMPARABILITY DATA AND CONTEMPORANEOUS SUBSTANTIATION OF THE DELIBERATION AND DECISION. DLSM AND ITS PARENT ORGANIZATION DIAKON'S EXECUTIVE COMPENSATION PROGRAM CONSISTS OF A BASE SALARY WHICH REFLECTS THE VALUE OF AN EXECUTIVE'S CAPABILITIES, EXPERIENCE AND SUCCESS THROUGH MEETING MISSION, FINANCIAL, OPERATIONAL, AND QUALITY OBJECTIVES. INFORMATION ABOUT EXECUTIVE COMPENSATION ISSUES AND DECISIONS IS REPORTED TO THE FULL BOARD OF DIRECTORS AT REGULAR MEETINGS. EMPLOYEE BENEFITS DLSM PROVIDES ALL EMPLOYEES, INCLUDING EXECUTIVES, WITH A COMPREHENSIVE BENEFIT PLAN THAT INCLUDES HEALTH INSURANCE, DENTAL INSURANCE, LIFE AND DISABILITY INSURANCE, AND A DEFINED CONTRIBUTION RETIREMENT PLAN. THE EMPLOYER MATCHING CONTRIBUTION TO THE DEFINED CONTRIBUTION PLAN WAS SUSPENDED AS OF JULY 2010. THE DLSM DEFINED BENEFIT RETIREMENT PLAN ACCRUALS WERE FROZEN AS OF 12/31/11. FORM 990, PART VI, SECTION C, LINE 19 DLSM MAKES ITS GOVERNING DOCUMENTS (ARTICLES OF INCORPORATION AND BYLAWS) AND CONFLICT OF INTEREST POLICY AVAILABLE UPON REQUEST. A STATEMENT OF FINANCIAL POSITION IS PUBLISHED IN THE ORGANIZATION'S ANNUAL REPORT, WHICH IS MAILED TO THE APPROXIMATELY 120,000 INDIVIDUALS ON THE ORGANIZATION'S PUBLICATION MAILING LIST. THE AUDITED CONSOLIDATED FINANCIAL STATEMENTS AND ANNUAL REPORT ARE ALSO AVAILABLE ON THE DLSM WEBSITE AT DIAKON.ORG, AS WELL AS UPON REQUEST. FORM 990, PART VII, SECTION A, LINE 1A COLUMN B REFLECTS THE AVERAGE HOURS PER WEEK PER EMPLOYEE FOR DLSM AND RELATED ORGANIZATIONS. FORM 990, PART XI, LINE 9: INCREASE IN FAIR VALUE OF SWAP AGREEMENT 1,090,140. EQUITY IN LOSSES OF JOINT VENTURE -255,690. PENSION-RELATED CHANGES OTHER THAN NET PERIODIC PENSION COSTS 887,238. LOSS FROM EARLY EXTINGUISHMENT OF DEBT -21,027,728. NET ASSETS RELEASED FROM RESTRICTIONS - CAPITAL 247,405. CONTRIBUTIONS AND BEQUESTS - TEMP RESTRICTED 143,805. INVESTMENT GAINS, NET OF EXPENSES - TEMP RESTRICTED 1,778,935. NET ASSETS RELEASED FROM RESTRICTIONS - OPERATIONS - TEMP RESTRICTED -794,407. NET ASSETS RELEASED FROM RESTRICTIONS - CAPITAL - TEMP RESTRICTED -247,405. CONTRIBUTIONS AND BEQUESTS - PERM RESTRICTED 414,350. DECREASE IN FAIR VALUE OF FUNDS HELD IN TRUST BY OTHERS - PERM RESTRICTED -1,769,338. FORM 990, PART XII, LINE 2C: DIAKON, THE SOLE MEMBER OF DIAKON LUTHERAN SOCIAL MINISTRIES, HAS AN ANNUAL AUDIT OF THE CONSOLIDATED FINANCIAL STATEMENTS FOR DIAKON AND CONTROLLED AFFILIATES PERFORMED BY AN INDEPENDENT ACCOUNTING FIRM. THE AUDIT COMMITTEE OF THE DIAKON BOARD OF DIRECTORS ASSUMES RESPONSIBILITY FOR THE OVERSIGHT OF THE AUDIT AND SELECTION OF THE INDEPENDENT ACCOUNTING FIRM. FORM 990, PART XII, LINE 3B: DIAKON ALSO HAS AN ANNUAL AUDIT UNDER THE SINGLE AUDIT ACT AND OMB CIRCULAR A-133 PERFORMED BY AN INDEPENDENT ACCOUNTING FIRM FOR THE CONSOLIDATED GROUP. DIAKON LUTHERWOOD SENIOR HOUSING 798 HAUSMAN ROAD STE 300 ALLENTOWN PA 18104 260649129 SENIOR HOUSING PA 1192568 3873167 DLSM DIAKON-SWAN LLC 798 HAUSMAN ROAD STE 300 ALLENTOWN PA 18104 473819776 ADOPTION AND PERMANENCY NETWORK PA 52281800 25451781 DLSM DIAKON 798 HAUSMAN ROAD STE 300 ALLENTOWN PA 18104 233014613 SUB OVERSIGHT PA 501(C)(3) 11 N/A 0 DIAKON LUTHERAN FUND 798 HAUSMAN ROAD STE 300 ALLENTOWN PA 18104 231365978 FUND PROGRAMS PA 501(C)(3) 11 DIAKON 0 DLSH AT LUTHER MEADOWS 798 HAUSMAN ROAD STE 300 ALLENTOWN PA 18104 232837747 HUD HOUSING PA 501(C)(3) 9 DLSM 1 DLSH AT HEILMAN HOUSE 798 HAUSMAN ROAD STE 300 ALLENTOWN PA 18104 232463233 HUD HOUSING PA 501(C)(3) 9 DLSM 1 DIAKON CHILD FAMILY & COMMUNITY MINISTRIES 798 HAUSMAN ROAD STE 300 ALLENTOWN PA 18104 465390969 SOCIAL SERVICES PA 501(C)(3) 9 DIAKON 0 INSTITUTE FOR STRATEGIC MANAGEMENT INC 960 CENTURY DRIVE MECHANICSBURG PA 17055 264316868 CONSULTING PA DIAKON C 0 0 1 0 0 0 0 0 0 0 1 0 1 0 0 1 0 1 0 0 DIAKON LUTHERAN SR HOUSING AT LUTHER MEADOWS O 107309 BOOK VALUE DIAKON LUTHERAN SR HOUSING AT HEILMAN HOUSE O 95171 BOOK VALUE DIAKON LUTHERAN SR HOUSING AT LUTHER MEADOWS Q 29490 BOOK VALUE DIAKON LUTHERAN SR HOUSING AT HEILMAN HOUSE Q 27322 BOOK VALUE