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HomeMy WebLinkAboutKnox County - Public Financial ReportPOPULAR ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR END JUNE 30, 2021 POPULAR ANNUAL FINANCIAL REPORT CONTENTS A Message From The MayorAbout The PAFRGFOA AwardsKnox County GovernmentOrganizational ChartKnox County At-a-GlanceMajor Initiatives2021 AccomplishmentsEmploymentCounty’s General FundSchool’s General FundDebtProperty Tax 33 44 5-65-6 77 88 9-119-11 1212 1313 14-1514-15 16-1816-18 19-2119-21 2222 2323 2 My fellow Knox Countians, Thank you for allowing me to serve as your mayor and for the opportunity to present Knox County’s Financial Report for 2021. It is my belief that Knox County is the best place to live, work, and raise a family. We are committed to providing opportunities for everyone to thrive in an engaged and vibrant community. Located at the foothills of the Smoky Mountains, Knox County is a special place with beautiful views, gleaming waterways, numerous hiking trails, biking and outdoor activities, along with the University of Tennessee which supports our volunteer spirit. With a focus on jobs, education, and recreation, we will continue to move Knox County forward as we strive to recruit new industries and businesses, improve our roads and infrastructure, and continue to focus on ensuring our students receive a quality education. I look forward to another year of progress with Knox County and hope you do as well. Sincerely, A MESSAGE FROM THE MAYOR POPULAR ANNUAL FINANCIAL REPORT Mayor Glenn Jacobs 3 POPULAR ANNUAL FINANCIAL REPORT POPULAR ANNUAL FINANCIAL REPORT The Knox County Department of Finance is proud to present this Popular Annual Financial Report (PAFR). This report provides summarized information about the County’s financial activities and is intended to give readers an overview of the County and its finances. Although the PAFR is not audited, the financial information reported is based on the audited 2021 Annual Comprehensive Financial Report (ACFR). The Department of Finance is responsible for the preparation of the ACFR. The ACFR contains three basic sections: the introductory section, which provides general information on the government’s structure, personnel, economic situation and finances; the financial section, which includes information on fund types, individual funds, and accouunt groups; the statistical section, which provides a broad range of trend data covering key financial indicators from the past ten fiscal years. The report also contains demographic and miscellaneous data useful in assessing the County’s financial situation.The governmental funds presented in this report are in conformity with Generally Accepted Accounting Principles (GAAP). The County also maintains other smaller funds that are not presented here. See the ACFR for complete details on all County funds. The 2021 ACFR is available online at https://knoxcounty.org/finance/annual_reports. php. ABOUT THE PAFR 4 POPULAR ANNUAL FINANCIAL REPORT The Government Finance Officer Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to Knox County Government for its annual comprehensive financial report for the fiscal year ended June 30, 2020. This was the 25th consecutive year that our government has achieved this prestigious award. To be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized, annual comprehensive financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. The County has also received, for the 26th consecutive time, the GFOA Award for Distinguished Budget Presentation for its 2021 Annual Operating Budget. In qualifying for this award, the County’s budget document was judged to be proficient in several categories, including policy documentation, financial planning, and organization.The County received the GFOA’s Award for Outstanding Achievement in Popular Annual Financial Reporting (PAFR award) for the fiscal year ended June 30,2020. The award represents a significant achievement by the County. Each eligible report is reviewed by judges who evaluate the report based on the following categories: reader appeal, understandability, distribution methods, creativity, and other elements. GFOA AWARDS 5 GFOA Certificate of Achievement for Excellence in Financial Reporting GFOA Award for Distinguished Budget Presentation for its Annual Operating Budget 26th Consecutive Year25thConsecutive Year POPULAR ANNUAL FINANCIAL REPORT 6 Government Finance Officers Association Award for Outstanding Achievement in Popular Annual Financial Reporting Presented to Knox County Government Tennessee For its Annual Financial Report for the Fiscal Year Ended June 30, 2020 Executive Director/CEO POPULAR ANNUAL FINANCIAL REPORT KNOX COUNTY GOVERNMENT Knox County is governed by an eleven-member board of commissioners, elected by district and at-large in partisan countywide elections held in August of even-numbered years. Commissioners serve four-year terms. The board’s primary duties are to adopt ordinances, emergency ordinances, and resolutions governing the operation of government or to regulate the conduct and affairs of the residents of Knox County. Each member of the Knox County Commission serves all Knox Countians eagerly and are happy to be of assistance to you. Fourth Row: Justin Biggs, Charles Busler, Kyle Ward Third Row: Larsen Jay, John Schoonmaker Second Row: Randy Smith, Richie Beeler, Carson Dailey First Row: Courtney Durrett, Terry Hill, Dasha Lundy Mission & VisionKnox County’s mission is to provide superior public service and support in an efficient and fiscally responsible way so that all residents can improve their quality of life while enjoying the benefits of a vibrant community. We believe that if we focus on transparency, invest in education and partner with our stakeholders, we will be able to create a pervasive culture of community vitality that guides us to becoming the workforce development center of East Tennessee. 7 POPULAR ANNUAL FINANCIAL REPORT6 POPULAR ANNUAL FINANCIAL REPORT ORGANIZATIONAL CHART 8 KNOX COUNTY AT-a-GLANCE POPULAR ANNUAL FINANCIAL REPORT KNOX COUNTY AT-a-GLANCE History Knox County was created on June 11, 1792, by Governor William Blount from parts of Greene and Hawkins counties, and has the distinction of being one of only eight counties created during territorial administration. It is one of nine United States counties named for American Revolutionary War general and first United States Secretary of War Henry Knox. Parts of Knox County later became Blount (1795), Anderson (1801), Roane (1801), and Union (1850) counties. LivabilityKnoxville ranks among the nation’s best places to live, raise a family, and own a business. It was ranked 14th “Least Expensive City” by Yahoo Finance in 2019, 2nd in Yahoo’s “10 Coolest Cities with the Lowest Cost of Living” in 2021, and 7th in U-Haul’s “Top 25 Growth Cities” for 2020. Post-Secondary Education Four two-year colleges and ten four-year universities are located in Knox County and the surrounding area. The University of Tennessee was ranked 52nd among the nation’s top public schools in 2021 by U.S. News and World Report. Civic Organizations The Knoxville Chamber has more than 2,200 members. United Way, Community Shares, and Community Action Committee support many youth, family, and social service pro-grams. More than 250 neighborhood associations and many civic groups are active throughout the city and county. 9 BUILDINGPERMITS $260 millionCommercial Valuations $676 million Residential Valuations 3,637 Residential Permits Issued POPULAR ANNUAL FINANCIAL REPORT 10 KNOX COUNTY AT-a-GLANCE POPULAR ANNUAL FINANCIAL REPORT 11 3RD 475,609 BUILDINGPERMITS Knox is the Third Largest County in the State 2020 Estimated Populationof Knox 526 Knox Areain Square Miles $260 millionCommercial Valuations $676 million Residential Valuations 3,637 Residential Permits Issued 4.8% $54,642 $249,000 Unemployment Rate (Pandemic) Per Capita Income Median House Value Largest Employer U.S. Department ofEnergy, Oak Ridge 17,079 Employees 5 Airlines 130 Flights Daily 52 Parks 198 Miles of Greenways &Walking Trails 86 Traffic Signals 1,086 Employees (FY21) SHERIFF 8,283 Arrests (2020) 34 Streets Resurfaced (Miles) 2,265 Miles of Streets 2.0m Passengers Annually 6,418 Park Acres Public Library& Branches18 POPULAR ANNUAL FINANCIAL REPORT10 KNOX COUNTY AT-a-GLANCE POPULAR ANNUAL FINANCIAL REPORT MAJOR INITIATIVES • Continuing progress of the Knox-Blount Greenway mega-project designed to provide pedestrians and cyclists connectivity from Knoxville to the Great Smoky Mountain National Park. • Creating a Comprehensive Land Use and Trans-portation Plan for the county and a specific Master Plan for Parks and Recreation. • Making major investments into the county’s splash pads. 12 MAJOR INITIATIVES POPULAR ANNUAL FINANCIAL REPORT 2021 ACCOMPLISHMENTS • Debuted new docuseries, ‘Knox Narratives’ to tell impor-tant stories about Knoxville, Knox County, and East Ten-nessee history using a long-form presentation.• Developed the free SeeClickFix mobile app and web ap-plication that helps improve local roadways.• Read City USA initiative started by the Mayor set a record by exceeding its goal of 1 million hours. • Refinanced more than $56 million in bond debt that will save taxpayers almost $4.5 million. • Launched a community newsletter. • Hosted the second-ever drive-thru School Mania, which provided school supplies to Knox County students.• Hosted the county’s first-ever Fall Festival and Trunk-or-Treat events. 13 POPULAR ANNUAL FINANCIAL REPORT The County’s unemployment rate has been consistently lower than the national rates for the past five years. The following graph presents the average annual unemployment rates for that time. The County’s unemployment rate was 4.8% in 2021, a significant improvement over the prior year rates due to the pandemic. EMPLOYMENT 14 POPULAR ANNUAL FINANCIAL REPORT The County is within the Knoxville Metropolitan Statistical Area (MSA) which is home to to the U.S Department of Energy and Covenant Health, which are major employers. The County’s primary occupations are in educational services, health care, hospitality, and retail trade sectors. Industry sectors such as agriculture, utilities, and management of companies and enterprises comprise small portions of the Knox County Industry Structure. The largest employers by number of employees have remained relatively consistent through the years. The following table lists organizations employing the most area workers as of the most recent available information. TOP 10 EMPLOYERS 2021 15 Column1 EMPLOYER NUMBER OF EMPLOYEES PERCENTAGE OF EMPLOYEES 1 U.S. Department of Energy, Oak Ridge Operations 17,079 4.08% 2 Covenant Health 11,060 2.64% 3 Knox County Public Schools 9,519 2.28% 4 The University of Tenness 8,959 2.14% 5 Walmart Stores 6,863 1.64% 6 University Health System 5,137 1.23% 7 K-V-A-T Food Stores 4,634 1.11% 8 The Dollywood Company 4,500 1.08% 9 Clayton Homes 4,262 1.02% 10 DENSO Manufacturing 4,200 1.00% TOTAL 76,213 18.22% POPULAR ANNUAL FINANCIAL REPORT COUNTY’S GENERAL FUND WHERE THE MONEY COMES FROM The General Fund accounts for resources traditionally associated with governments that are not required legally or by financial management to be accounted for in another fund. The ‘Miscellaneous’ section consists of the wheel tax, increases in equity interest in joint ventures, and from other government and citizen groups. The General Fund accounts for the normal recurring activities of the County (i.e., public safety, recreation, health and welfare, general government, etc.). These activities are funded principally by property taxes on individuals and businesses. 16 POPULAR ANNUAL FINANCIAL REPORT WHERE THE MONEY GOES 17 COUNTY’S GENERAL FUND Finance & Administration18% Administration of Justice (Court System)11% Public Safety49% Public Health & Welfare10% Social & Cultural Services3% Agricultural & Natural Resources<1% Other General Government9% POPULAR ANNUAL FINANCIAL REPORT COUNTY’S GENERAL FUND EXPENDITURES - GENERAL FUND REVENUE - GENERAL FUND Category 2019 2020 2021 20/21 Variance County Property Taxes 125,637,491$ 126,640,655$ 129,930,136$ 3,289,481$ Local Option Sales Taxes 6,839,780 7,672,552 9,773,736 2,101,184 Business Taxes 10,492,518 10,809,938 11,541,602 731,664 Wheel Taxes 572,282 564,983 595,939 30,956 Other Local Taxes 2,686,853 2,036,010 1,715,029 (320,981) Licenses & Permits 5,043,155 5,340,198 3,270,600 (2,069,598) Fines, Forfeitures & Penalties 2,190,263 2,313,421 1,444,113 (869,308) Charges for Current Services 8,458,108 7,829,148 8,081,856 252,708 Other Local Revenues 6,423,269 6,231,325 5,610,525 (620,800) State of Tennessee 12,851,494 16,092,038 12,865,323 (3,226,715) Federal Government 1,414,906 2,597,015 3,009,348 412,333 Other Governments & Citizen Groups 421,131 796,941 448,113 (348,828) Increase in Equity Interest in Joint Venture 298,686 408,316 930,016 521,700 Total Revenues 183,329,936$ 189,332,540$ 189,216,336$ (116,204)$ Category 2019 2020 2021 20/21 Variance Finance & Administration 33,493,502$ 32,699,879$ 32,904,296$ 204,417$ Administration of Justice (Court System) 20,012,386 20,015,623 20,127,356 111,733 Public Safety 88,340,254 88,622,008 87,953,708 (668,300) Public Health & Welfare 23,457,235 18,412,051 17,650,112 (761,939) Social & Cultural Services 5,231,099 5,893,413 5,484,322 (409,091) Agricultural & Natural Resources 483,133 488,941 391,064 (97,877) Other General Government 16,774,661 16,402,264 19,066,276 2,664,012 Total Expenditures 187,792,270$ 182,534,179$ 183,577,134$ 1,042,955$ 18 Notes: *Property taxes and sales taxes continue to out perform projections. The County is experiencing a robust economy. *Building permits that were previously in the Licenses & Permits category were moved under the Engineering & Public Works Fund. *Several revenue items from the State of Tennessee decreased in the current year. Note: In the category of Other General Government a one-time pay adjustment was approved during FY 2021 for $1.5 million. 18 SCHOOL’S GENERAL FUND POPULAR ANNUAL FINANCIAL REPORT EXPENDITURES - GENERAL FUND REVENUE - GENERAL FUND Category 2019 2020 2021 20/21 VariancePersonal Services 316,257,731$ 328,241,913$ 340,169,080$ 11,927,167$ Employee Benefits 88,969,412 93,091,698 94,427,585 1,335,887 Contracted Services 30,432,151 31,149,169 28,660,108 (2,489,061) Supplies & Materials 29,791,076 28,003,070 22,807,460 (5,195,610) Other Charges 15,147,771 14,631,470 12,068,215 (2,563,255) Capital Outlay 1,248,501 1,188,577 2,073,915 885,338 Payments to Primary Government 13,297,034 11,072,668 11,449,356 376,688 Total Expenditures 495,143,676$ 507,378,565$ 511,655,719$ 4,277,154$ Category 2019 2020 2021 20/21 VarianceProperty Taxes 102,501,659$ 103,802,639$ 106,153,334$ 2,350,695$ Local Option Sales Taxes 157,968,631 163,255,052 186,716,867 23,461,815 Wheel Tax 1,719,672 1,697,739 1,790,760 93,021 Other Local Taxes 1,038,560 787,312 673,680 (113,632) Licenses & Permits 34,627 33,275 34,999 1,724 Charges for Current Services 486,473 400,960 410,389 9,429 Other Local Revenues 4,677,941 4,533,456 3,819,895 (713,561) State of Tennessee 226,073,473 233,354,463 242,268,770 8,914,307 Federal Government 671,598 673,679 615,460 (58,219) Other Governments & Citizen Groups 18,449 12,000 215,335 203,335 Interest Earned 724,327 329,345 940,434 611,089 Payments from Primary Government 2,082,000 1,932,000 1,932,000 - Total Revenues 497,997,410$ 510,811,920$ 545,571,923$ 34,760,003$ 19 Note: School’s revenues have increased over the last three years through a continued robust economy. Note: Expenditures within the School’s General Fund is made up of thousands of accounts and can fluctuate greatly from year to year. POPULAR ANNUAL FINANCIAL REPORT SCHOOL’S GENERAL FUND WHERE THE MONEY COMES FROM 20 General Purpose School Fund: This fund is used to account for general operations of the Board of Education. Major funding is provided through local tax levies and state education funds. The ‘Other Local Revenues’ section consists of the wheel tax, other local tax, licenses and permits, charges for current services, federal government, other governments and citizen groups, interest earned, and payments from the primary government. 20 POPULAR ANNUAL FINANCIAL REPORT WHERE THE MONEY GOES 21 SCHOOL’S GENERAL FUND Personal Services66.5% Employee Benefits 18.5% Contracted Services5.6% Supplies &  Materials4.5% Other Charges2.4% Capital Outlay 0.4% Payments to Primary  Government 2.1% POPULAR ANNUAL FINANCIAL REPORT DEBT 22 Knox County’s total bonded debt decreased by $5,212,256 or 1.4% during the current fiscal year. This was due to principal bond payments that were more than debt issuances, as shown in the table below. The current year increase in total bonded debt was due to planned bond issuances. Future scheduled principal payments on bonds exceed planned bond issuances. They will keep the County on track to maintain the Mayor’s commitment to lowering the overall bonded debt levels of the County and Board of Education. Bonded Debt Balance for 2021 County Board Total Beginning Balance 373,155,577$ 273,065,941$ 646,221,518$ Principal Paid (68,726,942) (30,617,339) (99,344,281) Proceeds from Debt Issuances 63,514,686 47,745,314 111,260,000 Ending Balance - Bonds 367,943,321$ 290,193,916$ 658,137,237$ POPULAR ANNUAL FINANCIAL REPORT PROPERTY TAX Knox’s County greatest revenue stream is from property taxes. The amount of property tax collected is established by the Property Assessor, followed by the County Commission approval based on the needs of the budget. The tax rate for 2021 was $2.12 for every $100 of assessed value. For every property tax dollar collected, 89 cents was used to support Knox County’s general fund, 80 cents was allocated to the general-purpose school fund and 43 cents toward the debt service fund. Column1 Amount % Total Levy General Fund 0.89$ 42% General Purpose School Fund 0.80$ 38% Debt Service Fund 0.43$ 20% Total Tax Levy 2.12$ 100% 23 KNOX COUNTY FINANCE DEPARTMENT www.knoxcounty.org