athens tn acfr fy2023

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City of Athens, Tennessee

Management’s Discussion and Analysis
June 30, 2023

As management of the City of Athens, we offer readers of the City’s financial statements this narrative
overview and analysis of the financial activities of the City of Athens for the fiscal year ended June 30,
2023. We encourage readers to consider the information presented here in conjunction with additional
information that we have furnished in our letter of transmittal, which can be found in pages A-1 to A-4 of

this report.
Financial Highlights

e The assets and deferred outflows of the City of Athens exceeded its liabilities and deferred inflows
at June 30, 2023 by $87,553,220 (net position). Of this amount, $49,800,457 (unrestricted net
position) may be used to meet the City’s ongoing obligations to citizens and creditors.

e Net position increased by $8,296,982, an increase of 10.47% compared to fiscal year 2022 total net
position. The City of Athens’ changes in net position is detailed in the chart on page B-6 of this
report. Total revenues increased $1,205,541, primarily due to an increase in local sales taxes, state
shared revenue and increased State funding for schools. Expenses increased $6,110,555 primarily
due to construction on the public works building, fire training tower, animal shelter and road
improvements related to the new school building.

e The City’s property tax rate remained at $1.0078 per hundred dollars of assessment.

e The City’s residential sanitation fee remained at $9.50 per month.

© Asof the close of the current fiscal year, the City of Athens’ governmental funds reported combined
ending fund balances of $50,163,501.

e At the end of the current fiscal year, unassigned fund balance for the General Fund was $19,147,282
or 145.87% of total General Fund expenditures. Expenditures do not include transfers to other
funds, which totaled $7,846,000 in the City’s General Fund. The percentage drops to 91.3% if
transfers are included with the total expenditures. This demonstrates the City’s fiscal discipline and
places the City in a strong financial position to meet unexpected emergencies, uncertainties at the
State level or slowdowns in the economy.

Overview of the Financial Statements

This discussion and analysis are intended to serve as an introduction of the City of Athens’ basic financial
statements. The City of Athens’ basic financial statements comprise three components: 1) government-
wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report
also contains other supplementary information in addition to the basic financial statements themselves.

Government-wide financial statements. The government-wide financial statements are designed to
provide readers with a broad overview of the City of Athens’ finances, in a manner similar to a private-
sector business.

The statement of net position presents information on all of the City of Athens’ assets and liabilities, with
the difference between the two reported as net position. Over time, increases or decreases in net position
may serve as a useful indicator of whether the financial position of the City of Athens is improving or
deteriorating.

B-1