athens tn acfr fy2023

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City of Athens, Tennessee

Management’s Discussion and Analysis
June 30, 2023

As of the end of the current fiscal year, the City of Athens’ governmental funds reported combined ending
fund balances of $50,163,501, an increase of $249,572 in comparison to the prior year. Approximately
37.59% of this total amount ($18,857,463) constitutes unassigned fund balance, which is available for
spending at the government’s discretion. Pursuant to GASB Statement No. 54, the remainder of fund
balance is classified as to: nonspendable -$332,264; restricted for a specific purpose by external constraint
or enabling legislation -$8,590,382 (law enforcement - $88,959; City Schools - $1,949 for career ladder and
$253,157 for stabilization reserve; General Obligation Bond Fund capital projects - $4,374,542; Cemetery
Perpetual Care - $258,517; Debt Service Funds for City projects - $44,923; Debt Service Fund for Schools -
$2,811,574; Hotel/Motel Tax Fund for tourism - $482,006; Internal School Fund student activities —
162,115; Drug Fund - $112,640); committed for a specific purpose per action of the City Council -
$12,508,534 (law enforcement - $25,613; capital projects - $12,467,331; Drug Fund - $15,590); or assigned
— intended by the City to be used for a specific purpose - $9,874,858 (education - $8,674,790;
encumbrances - $103,350; cafeteria operations - $1,096,718).

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 $19,147,282. 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 146.63% of total fund expenditures, but represents 91 30% when
compared to total fund expenditures and transfers to other funds (General Purpose School Fund, Debt
Service Fund and Capital Improvement Fund).

The fund balance of the City of Athens’ General Fund increased by $807,094 during the current fiscal year.
Revenues increased by $779,226 while expenditures increased by $418,795 before transfers to other funds.
Property taxes decreased due to a decrease in the assessed value of personal property. Local and state sales
tax continued to increase at higher than expected amounts. Interest earnings increased significantly due to
the increase in interest rates. The transfer to the Capital Projects Fund increased by $465,000.

The fund balance of the General Purpose School Fund increased by $530,292. This was due to the
increased funding from the State of Tennessee.

The Capital Improvement Fund has a total fund balance of $12,467,331. The net increase was $2,990,849.
Capital items consisted primarily of renovations of the Public Works offices, building a fire training tower
and improvements to recreation facilities.

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 $49,542 for the Conference Center Fund,
$3,181,761 for the Sanitation Fund, $5,552,123 for the Fleet Management Fund and $394,337 for the

Employee Medical Benefits Fund.

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