athens tn acfr fy2021

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Economic Condition and Outlook 
The economic indicators for the City of Athens and the region were very positive and unemployment 
rates were very low until the impact of COVID-19. Unemployment rates increased significantly as many 
businesses were forced to close for a period of time. Conditions began to stabilize in May and June of 
2020 and have shown significant improvement since then including a steady decline in the unemployment 
rates. The highest unemployment rate was 17.2% in April and has declined since then to 6.4% in June of 
this year. Compared to the prior year, sales tax increased 20.4% in 2021 and state shared sales tax 
increased 15.7%. 
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 seven years. This increased employment by over 400 employees for 
this one industry. An Aspen Dental and Aldi grocery store will open during the next six months. A new 
retail development is being planned that will include at least four new retail establishments and three 
outparcels. Three single family housing developments have started the required earthwork for up to 170 
houses. 
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. 
The Tennessee Board of Regents opened the McMinn Higher Education Center at a cost of $17.75 
million to provide workforce training and development for industries in our community. McMinn County 
and the City of Athens both contributed funding to assist in building this facility. 
Long-Term Financial Planning 
Unassigned fund balance in the general fund has continued to grow for seven 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. 
The City has identified approximately $40,000,000 in capital funding items. The policy for the City 
has been to fund many of these types of projects with grant monies or the funds accumulated in the capital 
improvement fund. The City and McMinn County, with assistance from the Athens Parks Foundation, 
have been making improvements to the Eureka Trail, which is 5.6 miles of abandoned rail line purchased 
from CSX and goes from Athens to Englewood. 
Relevant Financial Policies 
Revenue policies provide for the City to budget revenues conservatively so that the chance of a revenue 
shortage during the year is remote. The City will review annually all fees and charges to assure that they 
maintain their inflation-adjusted purchasing power. The City will make every effort to avoid becoming too 
dependent on one source of revenue in order to minimize serious fluctuation in any year. The City will 
consider market rates and rates of comparable cities in the region when changing tax rates, fees and charges. 
In this regard, the City will make every effort to maintain its favorable comparative position with other 
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