athens tn acfr fy2023

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Local Economy

The City of Athens enjoys a favorable economic environment and local indicators point to continued
stability. Local sales tax and state shared sales tax revenues continue to increase and the unemployment
rate is 4.7% as of June, 2023. Unfortunately, Staples closed its store but this resulted in the relocation of
an existing appliance store to the Staples building and left an open space to be available for Aldi. Aldi is
a supermarket chain that had expressed an interest in locating in Athens for some time. This spurred a
renovation of the strip center where Aldi located and made it more attractive for lessees. Weigel’s, a
convenience store chain, is developing a site near Interstate 75 that will attract personal and commercial
vehicles. Planet Fitness and Tidal Wave Auto Spa are developing sites to be opened in FY2023. Starr
Regional Medical Center is expanding to begin providing cardiac catheterization services.

One area that Athens has lacked in development over the past decade has been the construction of
single-family homes. DR Horton, a national home construction company, has constructed over 100
residences and continues to develop other sites with the total expected to exceed 150 new homes. Several

other contractors are developing residential sites as well.

Major industries located within the City include several automotive parts suppliers, manufacturers of
electrical components and plastics, and a producer of dairy products. Denso, the City’s largest employer,
has expanded three times in the past nine years and is currently adding warehouse space. There continues
to be interest from several industries to locate in Athens. Aspen Dental and an Aldi grocery store opened

during the fiscal year.

Athens and McMinn County have jointly participated in a tax abatement program for new and
existing businesses. Capital investment and increased employment are two of the primary reasons for this
program, Capital investment results in increased property taxes and the additional employees result in
individuals having the means to spend dollars locally, helping the entire local economy.

Long-Term Financial Planning and Major Initiatives

Unassigned fund balance in the general fund has continued to grow for most of the past ten years.
The current year resulted in an increase in the unassigned fund balance. The policy is to maintain an
unassigned fund balance in the general fund that equals 75% of budgeted expenditures. After the fiscal
year is closed, a recommendation is made to the City Council to transfer the excess amount to the capital
improvement fund to accumulate funds for large capital items and grant matching funds.

In August of 2019, the voters in Athens approved a $.75 increase in the local option sales tax. The
City Council designated the first $1,000,000 collected annually to go toward the school building project
and the City Schools will contribute $700,000 annually from savings due to the consolidation of four
schools. The Council has approved borrowing up to $40,000,000 to construct the new elementary school
on the property at City Park. Bids were approved in early 2021 and construction began on the facility that
will hold all pre-k to fifth grade students for the City Schools. The building opened in August of this year
which resulted in the demolition of City Park Elementary as it was on the site used for the new school.
Three remaining school buildings have been turned over to the City. Even though the new building was
opened in August, construction is still being done on the exterior areas and athletic facilities and work is

expected to be finished on the entire project in January, 2024.

The City issued $7,350,000 in bonds in October, 2021 for road improvements around the new school,
renovations to the public works facility, renovations to City Hall, a fire training tower and a new animal

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