2021 Annual Comprehensive Financial Report

MANAGEMENT’S DISCUSSION AND ANALYSIS As management of the City of Greensboro, we offer readers of our financial statements this narrative overview and analysis of the financial activities of the City of Greensboro for the fiscal year ended June 30, 2021. The Management Discussion and Analysis (MD&A) section is designed to assist the reader in focusing on significant financial issues, provide an overview of the City’s financial activity, identify changes in the City’s financial condition, identify material deviations from the financial budget, and identify individual fund issues or concerns. Since the MD&A is structured to focus on the current year’s activities, resulting changes and currently known facts, we encourage readers to consider the information presented here in conjunction with the transmittal letter, which can be found beginning on page I of this report, and the City’s financial statements, which follow this section. FINANCIAL HIGHLIGHTS  The assets and deferred outflows of the City of Greensboro exceeded its liabilities and deferred inflows at the close of the fiscal year by $1.17 billion (net position) . The City’s net position increased by $27.7 million (2.4%) compared to FY 2020. The governmental net position increased $28.9 million (11.4%) primarily due to increased local sales tax revenue, and neighborhood development revenue related to operating grants. Business-type net position decreased $1.2 million (0.1%) primarily due to the impact of the COVID-19 pandemic. Events at the Coliseum were canceled, transit and parking revenues were reduced due to COVID 19 restrictions during FY 2021.  The governmental activities program revenue was higher than last year’s results by approximately $4.2 million at $82.7 million. The difference is primarily related to FY 2021 neighborhood development operating grants, an increase over prior year of $5.3 million mainly coming from an increase in emergency rental assistance provided in FY 2021. General governmental revenues increased by $11.1 million (4.0%), primarily due to increased sales tax collected. Sales tax receipts increased by 18.5% or approximately $10.4 million for FY 2021 due to unexpected consumer spending during the pandemic. The property tax rate remained the same as last year at $.6625 per $100 assessed valuation. Base property values are projected to grow at 1.52% in FY 2022. Investment earnings were the equivalent of 1.19 cents on the property tax rate compared to 3.28 cents last year. For budgeting purposes, management projects interest earnings to remain flat for the near-term planning cycle for conservatism. In the City’s business-type activities, total revenues decreased by about $74.1 million from the prior year. The decrease comes primarily from the Coliseum. Events were not held due to the COVID-19 pandemic and the completed Steven Tanger Center for the Performing Arts no longer received donations for construction of the building, which was completed in March of 2020.  During the year, the City’s governmental expenses at the entity-wide level were $339.7 million, an increase of $8.1 million or 2.5% more than last year, primarily due to increased expenses related to emergency rental assistance, (assisting households that are unable to pay rent or utilities) as well as increased expenses related to the construction of two fire stations. In all, expenses decreased $14.5 million or 2.7% citywide with a decrease of approximately $22.6 million affecting business-type activity. Decreased expenditures in the proprietary funds were primarily due to the Coliseum’s decreased maintenance and operations expenses from lack of events due to COVID-19 restrictions. Of the City’s various business-type service areas, water and sewer operations generated sufficient revenues in their programs to cover expenses.

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