athens tn acfr fy2020

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City of Athens, Tennessee
Management’s Discussion and Analysis

June 30, 2020

spending at the government’s discretion. Pursuant to GASB Statement No. 54, the remainder of fund
balance is classified as to: nonspendable -$232,762; restricted for a specific purpose by external constraint
or enabling legislation -$1,575,395 (law enforcement - $120,785; City Schools - $84,397; cemetery
perpetual care - $251,278; Debt Service - $1,003,009; Drug Fund - $115,926); committed for a specific
purpose per action of the City Council - $6,982,666 (law enforcement - $21,383; capital projects -
$6,921,446; education capital projects - $24,247; Drug Fund - $15,590); or assigned — intended by the City
to be used for a specific purpose - $5,023,621 (education - $4,689,390; cafeteria operations - $334,231).

The General Fund is the chief operating fund of the City of Athens. At the end of the current fiscal year,
unassigned fund balance of the General Fund was $13,640,768. As a measure of the General Fund’s
liquidity, it may be useful to compare unassigned fund balance to total General Fund expenditures.
Unassigned fund balance represents 97.77% of total fund expenditures, but represents 79.62% when
compared to total fund expenditures and transfers to other funds (General Purpose School Fund and Capital

Improvement Fund).

The fund balance of the City of Athens’ General Fund decreased by $275,420 during the current fiscal year.
Revenues increased by $319,103 while expenditures increased by $2,143,668 before transfers to other
funds. Property taxes, local sales tax and interest earnings increased, while state income tax and court fines
decreased over the prior year. The transfer to the Athens City Schools remained consistent with the prior
year. The transfer to the Capital Projects Fund increased by $700,000.

The fund balance of the General Purpose School Fund increased by $917,221. Much of this was due to not
filling some vacant positions and a reduction in capital outlay.

The Capital Improvement Fund has a total fund balance of $6,921,446. The net increase was $1,670,482
due to the $750,000 transfer from the General Fund and more than $800,000 is from sales tax proceeds.
Capital items consisted of street improvements, traffic studies, recreation projects, Denso Eco Park and
renovations of the Municipal Building. Some of the items were funded by grants and proceeds from the

sale of electricity generated by the City-owned solar panels.

Proprietary funds. The City of Athens’ proprietary funds provide the same type of information in the
government-wide financial statements, but with more detail.

Unrestricted net position at the end of the year amounted to $32,946 for the Conference Center Fund,
$2,881,730 for the Sanitation Fund, $4,852,548 for the Fleet Management Fund and $378,722 for the

Employee Medical Benefits Fund.

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