2016-02-11T18:32:37-06:00 2015-06-27 911233794 HAGEN KURTH PERMAN & CO PS 1111 THIRD AVENUE SUITE 800 SEATTLE WA 98101 990 2014-06-29 910568708 SEATTLE GOODWILL INDUSTRIES SEAT 2063291000 700 DEARBORN PLACE S SEATTLE WA 98144 MICHAEL JURICH VP - CFO 2063291000 2016-02-09 1 PHILIP R LAUBE CPA P00016966 2066829200 2014 2016-04-25 22:37:26Z MICHAEL JURICH 700 DEARBORN PLACE S SEATTLE WA 98144 145056512 0 X WWW.SEATTLEGOODWILL.ORG X 1923 WA SEATTLE GOODWILL IS A NONPROFIT ORGANIZATION THAT PROVIDES EMPLOYMENT TRAINING AND BASIC EDUCATION TO INDIVIDUALS EXPERIENCING SIGNIFICANT BARRIERS TO ECONOMIC OPPORTUNITY. OUR THRIFT STORE OPERATION IS AN INTEGRAL PART OF THE ORGANIZATION AND PROVIDES ON THE JOB TRAINING AND FUNDING FOR TRAINING AND EDUCATION PROGRAMS. SEE FORM 990, PART III, LINES 4A AND 4B FOR MORE INFORMATION. 19 18 2942 665 0 0 2229789 2469919 90917098 96393861 93269 184321 3836730 4138319 97076886 103186420 1051696 1029671 0 0 55266935 62827429 0 0 472095 30959928 33541943 87278559 97399043 9798327 5787377 104394927 110366550 40623063 40256604 63771864 70109946 X GOODWILL PROVIDES QUALITY, EFFECTIVE EMPLOYMENT TRAINING AND BASIC EDUCATION TO INDIVIDUALS EXPERIENCING SIGNIFICANT BARRIERS TO ECONOMIC OPPORTUNITY. BECAUSE JOBS CHANGE LIVES. 0 0 83683543 104030317 RETAIL PROGRAM:WE CONTINUE TO SEE GROWING COMMUNITY NEED FOR OUR THRIFT STORES WHICH SELL QUALITY, VALUE PRICED, CLOTHING AND HOUSEHOLD GOODS. WE OPENED A NEW STORE TO SERVE THE JUANITA NEIGHBORHOOD OF KIRKLAND, WASHINGTON AND HELP FUND EXPANDED JOB TRAINING AND EDUCATION SERVICES. WE PROCESSED, SOLD AND RECYCLED 58,500 TONS OF DONATED GOODS, PROVIDING MUCH NEEDED VALUE TO OUR CUSTOMERS, TRAINING, EDUCATION AND EMPLOYMENT OPPORTUNITIES FOR PEOPLE WITH MULTIPLE BARRIERS TO EMPLOYMENT AND THE ENVIRONMENTAL BENEFIT OF KEEPING THESE ITEMS OUT OF LANDFILLS. 10823898 1029671 JOB TRAINING AND EDUCATION PROGRAM:SEATTLE GOODWILL ENROLLS PEOPLE IN A VARIETY OF INSTRUCTION AND TRAINING SETTINGS, INCLUDING WORKSHOPS IN PARTNERSHIP WITH OTHER ORGANIZATIONS, ONE-ON-ONE SERVICES, ADULT BASIC EDUCATION CLASSES AND INTENSIVE BUSINESS SECTOR TRAINING PROGRAMS. STUDENT ENROLLMENT IN OUR FREE JOB TRAINING AND EDUCATION CLASSES TOTALED 8,792. AS STUDENTS BECOME READY TO WORK, OUR EMPLOYMENT SPECIALISTS PROVIDE JOB SEARCH AND RETENTION SERVICES WHICH HELPED 1,300 STUDENTS FIND EMPLOYMENT. THROUGH OUR PARTNERSHIP WITH VITA, 4,072 LOWER-INCOME COMMUNITY MEMBERS RECEIVED FREE TAX PREPARATION SERVICES WHICH RETURNED $6 MILLION IN TAX REFUNDS TO PARTICIPANTS. WE ASSISTED 158 OF OUR STUDENTS ENTER COLLEGE OR TECHNICAL TRAINING INSTITUTIONS THROUGH OUR CAREER PATHWAYS INITIATIVES. 94507441 1 1 0 1 0 0 0 0 0 0 1 1 0 0 1 1 1 0 0 0 0 0 0 0 1 0 0 0 1 1 1 0 0 0 0 0 0 0 1 0 1 1 0 0 0 0 0 0 0 0 1 439 0 1 2942 1 0 0 0 0 1 1 1 1 1 1 0 0 0 X 19 18 1 0 0 0 0 0 0 1 1 0 0 1 1 1 1 1 1 1 0 0 WA X X MICHAEL JURICH VPCFO 2068605709 700 DEARBORN PLACE S SEATTLE WA 98144 RICHARD N PAHRE TREASURER 1.00 X 0 0 0 DANIEL DA SILVA DIRECTOR 1.00 X 0 0 0 LAURIANN REYNOLDS DIRECTOR 1.00 X 0 0 0 REAH DEPRIEST DIRECTOR 1.00 X 0 0 0 JOHN HAYDUK DIRECTOR 1.00 X 0 0 0 SCOTT MISSALL DIRECTOR 1.00 X 0 0 0 SHELLIE SADR DIRECTOR 1.00 X 0 0 0 SCOTT WILSON DIRECTOR 1.00 X 0 0 0 DARYL CAMPBELL PRESIDENT & CEO,DIRECTOR 40.00 X X 91623 0 3465 WAYNE LAU DIRECTOR 1.00 X 0 0 0 CATHERINE GIBSON IMMEDIATE PAST CHAIR 1.00 X 0 0 0 MARKEE A FOSTER CHAIR 1.00 X 0 0 0 BRODERICK SMITH DIRECTOR 1.00 X 0 0 0 TODD R SPROUL DIRECTOR 1.00 X 0 0 0 MARIANNE SHORT SECRETARY 1.00 X 0 0 0 JAMES THOMAS DIRECTOR 1.00 X 0 0 0 MICHAEL KILLEEN DIRECTOR 1.00 X 0 0 0 DERRYL WILLIS VICE CHAIR 1.00 X 0 0 0 AMY MORRISON-GOINGS DIRECTOR 1.00 X 0 0 0 MICHAEL JURICH VP - CFO 40.00 X 215293 0 14610 CYNTHIA FORSLUND VP - RETAIL OPERATIONS 40.00 X 215221 0 14617 BG NABORS-GLASS VP - JOB TRAINING/EDUCATION 40.00 X 152768 0 12020 SUZANNE EBLING VP - HUMAN RESOURCES 40.00 X 159901 0 9383 CATHERINE MCCONNELL VP - MARKETING/COMMUNICATI 40.00 X 152951 0 3626 ELBERT FISH III VP - LOSS PREVENTION 40.00 X 144518 0 9073 NICOLE ROBERTS RETAIL/OPERATIONS DIRECTOR 40.00 X 138172 0 6753 ANDREW ZOZOM JR VP RETAIL OPERATIONS 40.00 X 123406 0 10692 RAYMOND OSBURN INFORMATION TECH DIRECTOR 40.00 X 108318 0 5743 KEN COLLING FORMER PRESIDENT & CEO,DIRECTOR 40.00 X 207174 0 4048 1709345 0 94030 10 1 1 0 0 X 8667 245313 489590 1726349 6901 2469919 PROGRAM SERVICES 453310 96393861 96393861 96393861 581901 581901 53519 0 53519 53519 53519 37319835 20291 37722073 15633 -402238 4658 -397580 -397580 100085 245313 100085 0 7636456 4032301 3604155 3604155 PUBLIC SUPPORT-OTHER 453310 240984 240984 MISCELLANEOUS 453310 239661 239661 480645 103186420 100478661 0 237840 1029671 1029671 1819401 1191150 567506 60745 51326449 50363321 828025 135103 214289 205682 6984 1623 4227966 4175036 45652 7278 5239324 5122076 103524 13724 55075 52697 2378 55885 55885 14141 3171 10970 2885724 2684136 106709 94879 1319076 1313174 3715 2187 983719 857288 124374 2057 6119179 6099066 20113 112086 95137 16863 86 1071800 1028418 42725 657 166230 163438 2792 5998940 5725936 244391 28613 811011 799644 10130 1237 SUPPLIES 2717642 2689156 27936 550 DISPOSAL 2210382 2210019 363 0 POSTAGE AND SHIPPING 1938238 1907199 5661 25378 EQUIPMENT RENTAL/MAINT 1630369 1618201 8960 3208 5452446 5173825 183851 94770 97399043 94507441 2419507 472095 33478 9099 9399 14980 3247804 1557875 5274499 4636747 271444 129163 1847296 793069 19625 23016 2553956 3043018 1663560 1737487 92285613 36552637 49127290 55732976 39865831 40793274 523622 1919925 104394927 110366550 8066893 8623460 39000 86265 28469773 27408987 4047397 4137892 40623063 40256604 X 63588644 70072919 183220 37027 63771864 70109946 104394927 110366550 5787377 550705 0 X X 0 1 X 1 0 X 776927 1983821 1926539 2229789 2469919 9386995 70668575 83304715 93245315 98234008 104030317 449482930 71445502 85288536 95171854 100463797 106500236 458869925 0 259554 288741 212094 286768 108769 1155926 259554 288741 212094 286768 108769 1155926 457713999 236512 276715 561893 720539 635420 2431079 236512 276715 561893 720539 635420 2431079 250099 298284 384643 323219 480645 1736890 71932113 85863535 96118390 101507555 107616301 463037894 0.98850 0.98790 0.00530 0.00480 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED X 0 1 0 0 0 0 1 4516 0 1 14141 18657 0 PART II-B, LINE 1: SEATTLE GOODWILL COLLABORATES WITH GOODWILL INDUSTRIES INTERNATIONAL TO ATTEND AN ANNUAL ADVOCACY DAY ON CAPITOL HILL IN WASHINGTON DC. MEMBERS OF CONGRESS WERE ENGAGED IN A DIALOGUE ABOUT THE FOLLOWING TOPICS IMPORTANT TO OUR MISSION: I) SUPPORT FOR WIOA FUNDING TO ENSURE SMOOTH TRANSITION OF NEW PROVISIONS OF THE LAW AND TO ENCOURAGE PROGRAM FUNDING TO THE FULLY AUTHORIZED LEVEL, II) SUPPORT FOR ADDITIONAL FUNDING FOR PROGRAMS AUTHORIZED UNDER THE SECOND CHANCE ACT, AND III) SUPPORT FOR FUNDING YOUTH PROGRAMS. SEATTLE GOODWILL ALSO PARTNERS WITH OTHER WASHINGTON STATE GOODWILL AFFILIATES TO ENGAGE A WASHINGTON STATE LOBBYIST. THIS LOBBYIST HELPS US BUILD STRONG RELATIONSHIPS WITH LEGISLATORS, MONITORS BILLS FOR POTENTIAL MISSION IMPACT, IDENTIFIES OPPORTUNITIES TO ADVANCE OUR MISSION THROUGH LEGISLATION AND PURSUES STATE FUNDING OPPORTUNITIES. LEGISLATION OF PARTICULAR INTEREST INCLUDED: SHB 1273 RELATED TO FAMILY AND MEDICAL LEAVE INSURANCE; SHB 1701 RELATED TO JOB APPLICANTS WITH ARREST HISTORY; HB 1355 RELATED TO MINIMUM HOURLY WAGE; HB 1356 RELATED TO SICK AND SAFE EMPLOYMENT LEAVE. 8145447 8145447 36087714 6743413 29344301 16850702 10697251 6153451 27393587 17985118 9408469 3808163 1126855 2681308 55732976 CD'S AND CORPORATE BONDS 40793274 F 40793274 CAPITAL LEASE OBLIGATIONS 1121260 INTEREST RATE SWAP CONTRACT 1405887 STRAIGHT-LINE RENT OBLIGATION 790594 DEFERRED TENANT ALLOWANCES, NET 820151 4137892 X 107889508 550702 20000 4132386 4703088 103186420 0 103186420 101551429 20000 4132386 4152386 97399043 0 97399043 PART X, LINE 2: FINANCIAL STATEMENT FIN 48 FOOTNOTE TEXT: SEATTLE GOODWILL USES THE ASSET AND LIABILITY METHOD IN PROVIDING FOR INCOME TAXES ON ALL TRANSACTIONS THAT HAVE BEEN RECOGNIZED IN THE FINANCIAL STATEMENTS. THIS METHOD IS IN ACCORDANCE WITH FINANCIAL ACCOUNTING STANDARDS BOARD ACCOUNTING STANDARDS CODIFICATION (ASC) 740, ACCOUNTING FOR INCOME TAXES. THE ASSET AND LIABILITY METHOD PROVIDES THAT DEFERRED TAXES BE ADJUSTED TO REFLECT THE TAX RATES AT WHICH FUTURE TAXABLE OR DEDUCTIBLE AMOUNTS WILL BE SETTLED OR REALIZED. DURING THE 2014 FISCAL YEAR, SEATTLE GOODWILL CONTINUED ITS APPLICATION OF ASC 740-10 AS IT RELATES TO UNCERTAIN TAX POSITIONS AND HAS EVALUATED ITS TAX POSITIONS TAKEN FOR ALL OPEN TAX YEARS. CURRENTLY, THE 2011, 2012 AND 2013 TAX YEARS ARE OPEN AND SUBJECT TO EXAMINATION BY THE INTERNAL REVENUE SERVICE. HOWEVER, SEATTLE GOODWILL IS NOT CURRENTLY UNDER AUDIT NOR HAS SEATTLE GOODWILL BEEN CONTACTED BY ANY JURISDICTION. BASED ON THE EVALUATION OF SEATTLE GOODWILL'S TAX POSITIONS, MANAGEMENT BELIEVES ALL POSITIONS TAKEN WOULD BE UPHELD UNDER AN EXAMINATION. THEREFORE, NO PROVISION FOR THE EFFECTS OF UNCERTAIN TAX POSITIONS HAS BEEN RECORDED FOR THE YEAR ENDED JUNE 27, 2015. PART XI, LINE 2D - OTHER ADJUSTMENTS: COST OF GOODS SOLD - SEE ADDITIONAL EXPLANATION GLITTER GALA FUNDRAISING EVENT DIRECT EXPENSES - SEE ADDITIONAL EXPLANATION PART XII, LINE 2D - OTHER ADJUSTMENTS: COST OF GOODS SOLD - SEE ADDITIONAL EXPLANATION GLITTER GALA FUNDRAISING EVENT DIRECT EXPENSES - SEE ADDITIONAL EXPLANATION PARTS XI AND XII, LINES 2D, DETAIL FOR OTHER ADJUSTMENTS: DIRECT FUNDRAISING EXPENSES OF $100,085 IS SHOWN NETTED AGAINST GROSS INCOME FROM FUNDRAISING EVENTS (FORM 990, PART VIII, LINE 8B) AND CORRESPONDINGLY EXCLUDED FROM EXPENSES. COST OF GOODS SOLD OF $4,032,301 IS SHOWN NETTED AGAINST GROSS SALES OF INVENTORY (FORM 990, PART VIII, LINE 10B) AND CORRESPONDINGLY EXCLUDED FROM EXPENSES. GLITTER GALA FASHIONSHOW 345398 245313 100085 45553 931 53601 345398 245313 100085 45553 931 53601 100085 0 1 JILL JONES AWARDS 473 69666 STIPEND 248 206718 YOUTH STIPEND 91 253326 AWARDS & GRANTS 2728 280189 PURCHASE COSTS GOODWILL COUPON CERTIFICATES AND GROCERY/DEPARTMENT STORE GIFT CARDS GED EXAM FEES 40 11185 TRANSIT PASSES/BUS TICKETS 2438 208559 FMV BUS TICKETS PART I, LINE 2: JILL JONES AWARDS: THIS FUND HOLDS BOARD DESIGNATED AND DONOR RESTRICTED FUNDS TO HELP CLIENTS WHO NEED EMERGENCY FINANCIAL ASSISTANCE, FOR EXAMPLE, TO PAY DELINQUENT RENT OR UTILITIES. THIS ASSISTANCE IS GOVERNED BY A FUND POLICY AND PAYMENTS ARE PAID DIRECTLY TO VENDORS, NOT THE CLIENT, AFTER RECEIVING APPROPRIATE DOCUMENTATION. STIPEND: SEATTLE GOODWILL INDUSTRIES' RETAIL/CUSTOMER SERVICE SECTOR TRAINING PROGRAM OFFERS STUDENTS A STIPEND TO THOSE WHO MAINTAIN ATTENDANCE STANDARDS ESTABLISHED PER POLICY. THESE STIPENDS HELP STUDENTS STAY IN THE PROGRAM, AS MANY HAVE LITTLE OR NO INCOME. YOUTH STIPENDS: SEATTLE GOODWILL'S THREE YOUTH PROGRAMS PROVIDE PARTICIPANTS WITH GENERAL AND INDUSTRY SPECIFIC JOB SKILLS TRAINING, COLLEGE PREPARATION, THE COMMUNITY SERVICE HOURS REQUIRED TO GRADUATE FROM HIGH SCHOOL, AND AN OPPORTUNITY TO BUILD THEIR TEAMWORK, LEADERSHIP, AND OTHER SOFT SKILLS. THESE PROGRAMS SERVE AT-RISK YOUTH AGES 15-24 WHO HAVE NOT COMPLETED HIGH SCHOOL OR ARE NOT WORKING. THE PROGRAMS RUN BETWEEN NINE MONTHS TO TWO YEARS. PARTICIPANTS ARE PAID A STIPEND THAT IS DEPENDENT UPON THEIR ATTENDANCE, PARTICIPATION, AND PROGRESS. AWARDS & GRANTS: CASE MANAGEMENT SUPPORT SERVICES HELP STABILIZE THE LIVES OF OUR CLIENTS, THEREBY IMPROVING RETENTION AND OUTCOMES. AWARDS AND GRANTS REFLECT COSTS FOR ITEMS PURCHASED OR PROVIDED TO CLIENTS THROUGH CASE MANAGEMENT, SUCH AS FOOD, CLOTHING, PERSONAL AND HOUSEHOLD ITEMS. EACH YEAR A FEW STUDENTS WHO HAVE GRADUATED FROM SEATTLE GOODWILL INDUSTRIES JOB TRAINING AND EDUCATION PROGRAMS ARE SELECTED, ACCORDING TO ESTABLISHED GUIDELINES, TO RECEIVE MARTIN SMITH MEMORIAL SCHOLARSHIPS TO ASSIST THE STUDENTS WITH THEIR FURTHER EDUCATION. GED EXAM FEES: SEATTLE GOODWILL PAYS EXAM FEES FOR CLIENTS PURSUING THEIR GED. TRANSIT PASSES/BUS TICKETS: STUDENTS MAY RECEIVE LIMITED FINANCIAL ASSISTANCE TOWARDS BUS TRANSPORTATION TO AND FROM JOB TRAINING AND EDUCATION FACILITIES. THIS SUPPORT ENABLES STUDENTS WITH TRANSPORTATION BARRIERS TO ATTEND TRAINING. X X X 0 0 0 1 0 1 0 1 0 MICHAEL JURICH VP - CFO 196066 0 19227 0 0 0 8607 0 6003 0 229903 0 97348 0 CYNTHIA FORSLUND VP - RETAIL OPERATIONS 196001 0 19220 0 0 0 8609 0 6008 0 229838 0 97283 0 BG NABORS-GLASS VP - JOB TRAINING/EDUCATION 139335 0 13433 0 0 0 6111 0 5909 0 164788 0 69167 0 SUZANNE EBLING VP - HUMAN RESOURCES 144751 0 15150 0 0 0 3621 0 5762 0 169284 0 71833 0 CATHERINE MCCONNELL VP - MARKETING/COMMUNICATI 139751 0 13200 0 0 0 2387 0 1239 0 156577 0 69333 0 ELBERT FISH III VP - LOSS PREVENTION 131835 0 12683 0 0 0 5781 0 3292 0 153591 0 65417 0 RAYMOND OSBURN INFORMATION TECH DIRECTOR 108318 0 0 0 0 0 0 0 5743 0 114061 0 53760 0 KEN COLLING FORMER PRESIDENT & CEO,DIRECTOR 144568 0 62606 0 0 0 3470 0 578 0 211222 0 207174 0 PARTS I AND II RETAIL MANAGEMENT BONUSES ARE BASED ON NET CONTROLLABLE CONTRIBUTION MARGIN, WHICH INCLUDES REVENUE AS PART OF THE EQUATION. BONUSES ARE CAPPED AT 1.5 TIMES THE TARGET BONUS FOR THE SPECIFIC POSITION. BONUSES IN EXCESS OF THE TARGET ARE EARNED BASED ON HOW MUCH NET CONTROLLABLE CONTRIBUTION MARGIN EXCEEDS BUDGET. VICE PRESIDENTS' BONUSES ARE BASED ON THE ACHIVEMENT OF VARIOUS GOALS AND OBJECTIVES, INCLUDING MEETING THE NET INCOME GOAL FOR THE ORGANIZATION. BONUSES ARE CAPPED AT 10% OF SALARY. CEO BONUS IS CAPPED AT 20% OF SALARY AND IS PAID AT THE DISCRETION OF THE BOARD AS RECOMMENDED BY THE COMPENSATION COMMITTEE. A WASHINGTON ECONOMIC DEVELOPMENT FINANCE AUTHORITY 911493002 NONEAVAIL 2010-12-16 30000000 REFINANCE EXISTING FACILITY DEBT; FINANCE NEW FACILITIES/RENOVATION 0 0 0 A 2591013 30000000 237166 26844210 2918624 2011 0 0 1 1 A 0 0 0 0 0 0 0 A 0 0 1 0 1 1 BANK OF AMERICA NA 5.400000000000 0 0 0 0 0 A 0 SCHEDULE K, PART II, LINE 3 AS OF YEAR ENDING 6/28/14, TRANCHE 1 IN THE AMOUNT OF $4,996,445, TRANCHE 2 IN THE AMOUNT OF $3,025,000, TRANCHE 3 IN THE AMOUNT OF $11,350,000, AND TRANCHE 4 IN THE AMOUNT OF $10,628,555 HAD BEEN FULLY DRAWN UNDER THE BOND. SCHEDULE K, PART II, LINE 11 $2,918,624 OF THE PROCEEDS RETIRED PRIOR DEBT INCURRED TO IMPROVE EQUIPMENT AND FACILITIES. SCHEDULE K, PART II, LINE 13 TRANCHE 1 PROJECT 7/23/10 TRANCHE 2 PROJECT 12/24/11 TRANCHE 3 PROJECT 4/5/13 TRANCHE 4 PROJECT 3/30/11 SCHEDULE K, PART III THE BOND LISTED IN PART I IS A POST DECEMBER 31, 2002 QUALIFIED 501(C)(3) BOND AND THE BOND-FINANCED PROPERTY DOES NOT RESULT IN PRIVATE BUSINESS USE. SCHEDULE K, PART IV, LINE 3C 5.4 YEARS AVERAGE TERM: TRANCHE 1 = 6.9 YEARS TRANCHE 2 = 5.6 YEARS TRANCHE 3 = 3.9 YEARS TRANCHE 4 = 5.1 YEARS SHELLIE SADR DIRECTOR 1126210 SHELLIE SADR IS EMPLOYED BY BANK OF AMERICA AND BANK OF AMERICA PROVIDES DEPOSITORY, DISBURSEMENT, CASH MANAGEMENT, EQUIPMENT LEASING, INVESTMENT AND CREDIT SERVICES TO SEATTLE GOODWILL. SHELLIE SADR'S RESPONSIBILITIES WITHIN BANK OF AMERICA DO NOT INVOLVE THE SALE OF SERVICES PROVIDED BY THE BANK TO SEATTLE GOODWILL AND SHE RECUSES HERSELF FROM BOARD DECISIONS RELATED TO BANK OF AMERICA. 0 MICHAEL J KILLEEN DIRECTOR 44996 MICHAEL J. KILLEEN IS A PARTNER IN THE LAW FIRM OF DAVIS WRIGHT TREMAINE, LLP ("DWT"). DWT IS USED BY SEATTLE GOODWILL AS AN OUTSIDE COUNSEL. MICHAEL KILLEEN DOES NOT PERFORM ANY PAID WORK PERSONALLY. ALL OF HIS TIME ON SEATTLE GOODWILL MATTERS IS PRO BONO. 0 SCOTT MISSALL DIRECTOR 57700 SCOTT MISSALL IS AN EQUITY PARTNER IN THE LAW FIRM OF SHORT CRESSMAN AND BURGESS, PLLC ("SCB"). SCB IS USED BY SEATTLE GOODWILL AS AN OUTSIDE COUNSEL. 0 MARIANNE SHORT DIRECTOR 1060 MARIANNE SHORT IS THE SENIOR VICE PRESIDENT OF HUMAN RESOURCES FOR THE SEATTLE MARINERS. SEATTLE GOODWILL PURCHASED BASEBALL GAME TICKETS FROM THE SEATTLE MARINERS FOR EMPLOYEE EVENTS. 0 X 8,226,527 - PART II X 88,167,333 - PART II X 1 6901 STOCK MARKET QUOTE 0 1 1 PART I, LINE 32B: AS PART OF SEATTLE GOODWILL'S RETAIL PROGRAM, SOME DONATED MERCHANDISE, INCLUDING BOOKS, IS SOLD ONLINE THROUGH ENTITIES SUCH AS EBAY, SHOPGOODWILL.COM, AMAZON, ABEBOOKS, ALIBRIS AND HALF.COM. PART I, LINE 33: SEATTLE GOODWILL RECEIVES CONTRIBUTIONS OF BOOKS, CLOTHING AND HOUSEHOLD GOODS (INVENTORY) AND PROCESSES THESE CONTRIBUTIONS AS MERCHANDISE OFFERED FOR SALE IN ITS RETAIL THRIFT STORES. SEATTLE GOODWILL BELIEVES THAT INVENTORY OF CONTRIBUTED GOODS AND MATERIALS DO NOT POSSESS AN ATTRIBUTE THAT IS EASILY MEASURABLE OR VERIFIABLE WITH SUFFICIENT RELIABILITY TO DETERMINE AN INVENTORY VALUE AT THE TIME OF DONATION. ACCORDINGLY, CONTRIBUTED GOODS AND MATERIALS INVENTORY ARE VALUED AT ZERO PRIOR TO BEING OFFERED FOR SALE. AS REPORTED ON FORM 990, SCHEDULE M, LINES 4 AND 5, THE REVENUE FOR THE CURRENT YEAR OF THESE DONATED PROPERTIES ARE $8,226,527 AND $88,167,333, RESPECTIVELY. THESE AMOUNTS ARE INCLUDED IN PROGRAM SERVICES REVENUE ON FORM 990, PART VIII, LINE 2A. FORM 990, PART VI, SECTION A, LINE 2 ALL OF THESE BUSINESS RELATIONSHIPS WERE CARRIED OUT IN THE NORMAL COURSE OF BUSINESS AND AT COMMERCIALLY REASONABLE RATES. BRODERICK SMITH, BOARD MEMBER, HAS A BUSINESS RELATIONSHIP WITH JOHN HAYDUK, SEATTLE GOODWILL BOARD MEMBER AND PRESIDENT OF JTM CONSTRUCTION. MR. SMITH HAS HIRED JTM CONSTRUCTION TO CONSTRUCT A BUILDING. THE WIFE OF DARYL CAMPBELL, PRESIDENT AND CEO, IS A REAL ESTATE AGENT WHO REPRESENTS BOARD MEMBER AMY GOINGS IN A PROPERTY PURCHASE. AMY GOINGS DOES NOT SERVE ON THE COMPENSATION COMMITTEE. BOARD MEMBER SCOTT MISSALL HAS REPRESENTED SUZANNE EBLING, VP OF HUMAN RESOURCES, IN A REAL ESTATE MATTER. FORM 990, PART VI, SECTION B, LINE 11 SEATTLE GOODWILL ENGAGES AN OUTSIDE ACCOUNTING FIRM TO PREPARE THE FORM 990 FROM INPUT AND DATA PROVIDED BY THE CHIEF FINANCIAL OFFICER AND ACCOUNTING DIRECTOR. A DRAFT FORM IS REVIEWED BY THE CHIEF FINANCIAL OFFICER AND ACCOUNTING DIRECTOR FOR ACCURACY BEFORE A FINAL FORM 990 IS PRODUCED. THE FINAL FORM 990 IS THEN PROVIDED TO ALL BOARD MEMBERS APPROXIMATELY ONE WEEK BEFORE THE FORM 990 IS FILED WITH THE IRS, AS PER IRS GUIDANCE. THE BOARD MEMBERS ARE NOT REQUIRED TO APPROVE THE FORM 990. FORM 990, PART VI, SECTION B, LINE 12C CONFLICT OF INTEREST DISCLOSURE FORMS ARE DISTRIBUTED ANNUALLY AND COMMUNICATION IS MADE ABOUT THE IMPORTANCE OF DISCLOSURE OF ANY REAL OR POTENTIAL CONFLICTS OF INTEREST SO THAT THEY CAN BE APPROPRIATELY MANAGED. EACH NEW BOARD MEMBER IS ALSO PROVIDED THIS SAME FORM AND INFORMATION. KEY EMPLOYEES ALSO RECEIVE AN ANNUAL CONFLICT OF INTEREST DISCLOSURE FORM AND HAVE BEEN TRAINED ON OUR ETHICS POLICIES. CLEAR PROCEDURES ARE ESTABLISHED FOR THE ANONYMOUS REPORTING OF ETHICS VIOLATIONS THROUGH A 1-800 REPORTING SERVICE OR DIRECTLY TO THE COMPLIANCE OFFICER OR CHAIR OF THE BOARD FINANCE AND AUDIT COMMITTEE. EACH YEAR, THE COMPLIANCE OFFICER MAKES A REPORT TO THE FINANCE AND AUDIT COMMITTEE OF THE BOARD AND TO THE FULL BOARD OF DIRECTORS ON COMPLIANCE POLICY MATTERS, INCLUDING A SUMMARY OF CONFLICT OF INTEREST FORM DISCLOSURES. FORM 990, PART VI, SECTION B, LINE 15A CEO COMPENSATION IS ESTABLISHED BY THE COMPENSATION COMMITTEE OF THE BOARD MADE UP OF INDEPENDENT DIRECTORS, USING COMPETITIVE SALARY SURVEYS AND CONSIDERING ORGANIZATION AND INDIVIDUAL PERFORMANCE. THE COMPENSATION COMMITTEE REPORTS ITS RECOMMENDATION TO THE BOARD ANNUALLY BEFORE CHANGES ARE MADE TO THE CEO COMPENSATION. THE VP POSITIONS ARE APPROVED BY THE BOARD, BUT VP COMPENSATION IS ESTABLISHED BY THE CEO, ALSO CONSIDERING INDIVIDUAL PERFORMANCE AND COMPETITIVE SALARY SURVEYS. THE COMPENSATION COMMITTEE RECEIVES A REPORT OF THE VP COMPENSATION AT THE SAME TIME IT CONSIDERS CEO COMPENSATION EACH YEAR. FORM 990, PART VI, SECTION C, LINE 19 OUR FORM 990 IS PUBLISHED ON OUR WEBSITE. WE DO NOT PUBLISH OUR GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY OR FINANCIALS TO THE GENERAL PUBLIC. THESE ARE PROVIDED TO GRANT FUNDERS, LESSORS, AND LENDERS UPON REQUEST. SUMMARY FINANCIAL INFORMATION IS PROVIDED, ALONG WITH MISSION OUTCOMES, TO THE PUBLIC IN OUR ANNUAL REPORT. THE ANNUAL REPORT IS PROVIDED TO THOSE WHO HAVE REQUESTED TO BE ON OUR DISTRIBUTION LIST AND PUBLISHED ON OUR WEBSITE. FORM 990, PART VIII, LINE 7(C) COLUMN (I), SECURITIES NET GAIN OR (LOSS): REALIZED AND UNREALIZED GAINS AND LOSSES INCLUDE AMORTIZATION OF PURCHASE PREMIUMS OR DISCOUNTS ON CERTIFICATES OF DEPOSIT AND CORPORATE BONDS. FORM 990, PART XII, LINE 2C, COMMITTEE OVERSIGHT OF AUDIT PROCESS: NO CHANGE TO PROCESS FROM PRIOR YEAR. SCHEDULE D, SUPPLEMENTAL FINANCIAL STATEMENTS, PART VII, INVESTMENTS-OTHER: SEATTLE GOODWILL HAS CERTIFICATES OF DEPOSIT (CDS), CORPORATE BONDS, AND INDEX FUNDS WITH READILY DETERMINABLE FAIR VALUES AS OF JUNE 27, 2015. CERTIFICATES OF DEPOSIT AND CORPORATE BONDS HAVE REMAINING TERMS RANGING FROM LESS THAN 1 MONTH TO 30 MONTHS. THE INDEX FUNDS DO NOT HAVE A MATURITY DATE, BUT ARE HELD WITH THE OBJECTIVE OF LONG-TERM CAPITAL APPRECIATION. INDEX FUNDS ARE CLASSIFIED AS LONG-TERM ON THE STATEMENTS OF FINANCIAL POSITION. THE CDS, CORPORATE BONDS, AND INDEX FUNDS ARE VALUED AT FAIR VALUE IN ACCORDANCE WITH FINANCIAL ACCOUNTING STANDARDS BOARD ACCOUNTING STANDARDS CODIFICATION (ASC) 958-320-NOT FOR PROFIT ENTITIES, DEBT AND EQUITY SECURITIES. REALIZED AND UNREALIZED GAINS AND LOSSES ON THE STATEMENT OF ACTIVITIES INCLUDE AMORTIZATION OF PURCHASE PREMIUMS OR DISCOUNTS ON CERTIFICATES OF DEPOSIT AND CORPORATE BONDS. INVESTMENT INCOME AND GAINS ON RESTRICTED INVESTMENTS WHOSE RESTRICTIONS ARE MET IN THE SAME REPORTING PERIOD ARE REPORTED AS UNRESTRICTED REVENUE AND SUPPORT. SEATTLE GOODWILL MAINTAINS SIGNIFICANT LIQUIDITY (RESERVES) AND WILL LIKELY CONTINUE TO DO SO IN THE FUTURE. IN CONSIDERING THE APPROPRIATE LEVEL OF RESERVES, SEATTLE GOODWILL EVALUATES THE FOLLOWING: - FUTURE REPLACEMENT OF FACILITIES ON ITS DEARBORN CAMPUS IN SEATTLE - OPENING OF NEW JOB TRAINING AND EDUCATION CENTERS AND NEW STORES - OPERATING RESERVES OF UP TO SIX MONTHS EXPENSES - LIQUIDITY REQUIREMENTS UNDER ITS BOND FINANCING - POTENTIAL DEBT MARKET CONDITIONS IN 2017 WHEN BANK OF AMERICA EVALUATES WHETHER IT WILL CALL FOR FULL PRINCIPAL REPAYMENT UNDER SEATTLE GOODWILL'S BOND FINANCING ON JANUARY 1, 2018. SCHEDULE L, TRANSACTIONS WITH INTERESTED PERSONS, PARTS IV AND V: ALL OF THE BUSINESS TRANSACTIONS AND RELATIONSHIPS REPORTED ON SCHEDULE L, PARTS IV AND V, WERE CARRIED OUT IN THE NORMAL COURSE OF BUSINESS AND AT COMMERCIALLY REASONABLE RATES.