2023 Annual Comprehensive 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, 2023. 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 $1.3 billion (net position) . The City’s net position increased by $102.9 million (8.5%) compared to FY 2022. The governmental net position increased $81.2 million (26.3%) primarily due to continued increases in local sales tax revenue and an increase in investment income. Business-type net position increased $21.7 million (2.4%) primarily due to increases in water and sewer revenues and $2.0 million in local sales taxes. Transit also received $1.3 million less in operating and capital grants than in FY 2022, however still a substantial amount at $21.3 million.  The governmental activities program revenue was higher than last year’s results by approximately $31.0 million at $135.7 million. The difference is primarily related to a FY 2023 increase of $55.6 million in General Government largely related to a transfer from the American Rescue Plan Act Fund to support governmental and community projects. General governmental revenues increased by $51.4 million (17.0%), primarily due to increased property tax collected. Property tax receipts increased by 18.4% or approximately $34.5 million for FY 2023 due to a revaluation conducted by Guilford County. Even though the property tax rate decreased from prior year to $.6325 per $100 assessed valuation, it was over 8 cents above the “revenue neutral” rate following revaluation. Investment income increased by $27.4 million over FY 2022, mainly due to an increase in fair market value. Investment earnings (excluding changes in fair market value) were the equivalent of 3.23 cents on the property tax rate compared to 1.01 cents last year. For budgeting purposes, management projects interest earnings to have conservative growth for the near-term planning cycle. In the City’s business-type activities, total general revenues and transfers increased by about $12.6 million from the prior year. The increase comes primarily from local sales taxes and an increase in investment income.  During the year, the City’s governmental expenses at the entity-wide level were $396.9 million, an increase of $30.0 million or 8.2% more than last year, primarily due to increases of expenses related to general government and public safety for added staffing and support. Environmental services expenditures increased by $2.6 million due to the Camp Burton capital project. In all, expenses increased $43.8 million or 7.0% citywide with increases of approximately $13.8 million affecting business-type activity. Increased expenditures in the proprietary funds were primarily due to increased personnel costs in both coliseum and transit departments resulting from an increase of services post pandemic.

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