2022 Annual Comprehensive Financial Report

FINANCIAL ANALYSIS OF THE CITY’S FUNDS A. Governmental Funds

As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance related legal requirements. As of June 30, 2022, governmental funds reported a combined fund balance of $193.4 million, a decrease of approximately $27.7 million or 12.5% of the FY 2021 amount. The General Fund net results increased fund balance by $10.3 million, due primarily to an increase in local sales tax revenue. Internal Service Funds are reported with the governmental activities in the Statement of Net Position. Overall operating expenditures (excluding debt service) increased approximately $19.2 million or 5.6% primarily due increased spending relating to $14.2 million of emergency rental assistance expenses and $4.8 million in additional expenses to complete the Battleground Park District updates. Debt service expenditures at $41.0 million are up $184,237 from the previous year. The current year transfers out exceeded transfers in by $25.4 million to support other operations including transfers to support Coliseum, Solid Waste Management and Parking enterprise funds. Fund balance of $136.5 million or 70.6% of the total amount is non spendable or restricted to indicate that it is not available for spending due to GASB No. 54 classifications of (1) Non-Spendable which includes inventories, prepaid expenses, leases, perpetual maintenance or assets held for resale (2) Restricted which includes amounts to liquidate contracts and purchase orders of the previous year, adherence to Stabilization for State Statute, amounts bound by debt covenants and third party grantor requirements. The adherence to State Statute limits the amount that may be appropriated by the governing board or for other restricted purposes. The remainder of fund balance represents amounts committed 4.4%, assigned 16.1% and unassigned 8.9% funds. The General Fund is the chief operating fund of the City. At the end of the current fiscal year, total fund balance of the General Fund was $102.7 million. Of this amount, $1.7 million is non-spendable, $43.5 million is restricted, $5.4 million is assigned for appropriation in next year’s budget, $18.8 million is assigned for capital projects and $33.5 million or 9% of the subsequent years’ budget is unassigned and retained for working capital purposes as well as unforeseen emergencies. General fund balance increased by $10.3 million due primarily to an increased amount of local sales tax collected. The Debt Service Fund has a fund balance of $1.5 million, $12.7 million less than last year, with a target level of $10 million. The fund covered debt service expenditures (principal and interest) of approximately $36.0 million, amounting to approximately 12.1 cents of the general property tax rate. The total fund balance at June 30, 2022, less amounts restricted by state statue, is assigned for debt service in next year’s budget with the balance to be used to stabilize property tax rates from year to year, despite future increases in debt service amounts due to new voter-approved bonds, as well as to support the City’s fund balance goals. Revenues for general governmental functions (General, Special Revenue, Capital Project and Debt Service Funds) amounted to $401,229,214 for the fiscal year ended June 30, 2022 and are comprised of various sources as shown in the following graph:

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