HomeMy WebLinkAboutTown of Nags Head - Public Financial ReportTOWN OFNAGS HEAD, NC
POPULAR ANNUAL FINANCIAL REPORT 2021
FISCAL YEAR ENDED JUNE 30, 2021
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 2
Table of Contents
Boards & Committees 3-4
Message from the Manager 4-5
Accomplishments 6
Initiatives 7-10
Grants 11
Net Position 12-13
The General Fund 14-17
General Fund Expenditures 18-21
Capital Reserve Fund 22
Water and Water Capital Reserve Funds 23-24
Beach Nourishment Capital Project Funds 25
Purpose
This Popular Annual Financial Report (PAFR) is a summary
of the financial activities of the Town’s funds as reported in
the 2021 Annual Comprehensive Financial Report (ACFR)
The ACFR is an audited document and is prepared in
conformance with generally accepted accounting principles
(GAAP) To conform with GAAP, the ACFR must present
the Town’s individual funds in much more detail and fully
disclose all material financial and non-financial events
Unlike the ACFR, the PAFR is not an audited document and
it does not include details by fund nor does it include the
other disclosures required by GAAP Therefore, the PAFR
is not intended to present a complete financial picture of
the Town in accordance with GAAP This report contains
financial information for July 1, 2020 through June 30,
2021 Information is presented in this report on the basis
of generally accepted accounting principles (GAAP) This
report is a reflection about how your tax dollars are being
spent in a simple, non-technical format
For more in-depth information, you can review this PAFR
and our recent ACFR online at http://www nagsheadnc
gov/228/Financial-Information You may request a print
copy or e-mail your comments concerning this report, or any
other aspect of the operations of the Town of Nags Head to
Andy Garman@nagsheadnc gov
2021 QUICK FACTS
Town of Nags Head full
time equivalent year-round
employees
119 5; additional 50 seasonal
Population
year-round – 3,175; seasonal –
40,000 persons a day
Median age
49 6 years old
Per capita personal income
$57,688
Average unemployment rate
6 9%*, higher than the State of
North Carolina’s 2021 average of
5 25%
Average household size of
owner-occupied houses
2 14
Median property value for owner-occupied houses
$326,100
Total assessed property
valuation
$3,097,162,628
Net taxes levied
$9,710,806
Tax collection rate
99 954%
Total outstanding debt obligation
$10,478,253
Principal employers
(in order of ranking)
Dare County Schools
Vidant Medical Center
Food Lion
Village Realty & Management Services
Town of Nags Head
State of NC Department of Cultural Resources
Principal Property Taxpayers
(in order of ranking)
Dominion NC Power
SRE Mustang
Nags Head Company, LLC
Stanford M White
Ocean Carolina, LLC
Brian K Newman
Mildred Roughton
The Lacour Group, LLC
The Outer Banks Hospital, Inc
ClubCorp Golf of North Carolina
*The Town’s economy is based on travel, tourism, and related services industries and therefore experiences significant seasonality in rates
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 3
Town of Nags Head Mission
To provide for the health, safety and
welfare of the citizens, property owners
and visitors of the town, to fulfill the
requirements placed on it by the State
of North Carolina and to facilitate the
achievement of community goals by
providing municipal services in a flexible,
cost effective, customer friendly manner
and to achieve this through an open,
consensus driven process that treats all
with respect
Shared Values
The Town of Nags Head is a unique
coastal community built upon a legacy
rooted in shared values, including our
most recognized common bond-a love for
the Outer Banks
We recognize that the town must be a
good place to live before it can be a good
place to visit
We strive to preserve and protect the
Nags Head character, environment,
tourism-based economy, and sense of
place to ensure a high quality of life
for residents and a memorable family
vacation experience for present and future
generations
Board of Commissioners
The mayor and four board members make policy decisions and adopt
ordinances in accordance with procedures and responsibilities set out
in North Carolina law The town manager carries out policies and
directives of the Mayor and Board of Commissioners
Working hand in hand with the town manager, the Board of
Commissioners plays a key role in the financial well being of the Town
of Nags Head, with a focused mission to serve the community’s citizens,
property owners, businesses, and visitors through open governance
Board of Commissioners meetings can be viewed online on the
Nags Head YouTube Channel.
Boards and Committees
“Create a ripple of change by getting your feet wet!”
Want to get involved in your town, but aren’t sure how to start? Get your
feet wet by sitting on a Town board or committee
Community involvement assists with plan elements of development,
goals, policies, programs, community engagement, and overall future
direction of certain Town initiatives
Arts & Culture Committee
Board of Adjustment
Community Watch Association
Dangerous Animal Appeal Board
Personnel Grievance Panel
Planning Board
Pictured left to right: Commissioner Kevin Brinkley, Mayor Ben Cahoon, Mayor Pro Tem
Michael Siers, Commissioner M Renée Cahoon, and Commissioner Bob Sanders The
Town of Nags Head would like to thank former Commissioner Webb Fuller who served
on the Board of Commissioners from December 2017 through December 2021
BOARDS & COMMITTEES
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 4
Each year we
prepare the
Popular Annual
Financial Report
(PAFR) to
summarize not only the
financial activities of the
town, but also the services
and accomplishments
from the prior fiscal year
This is one of the many ways we communicate the activities
of Nags Head’s government to our many constituents
Moving into FY 2021, we were faced with much uncertainty
due to the onset of the pandemic The FY 2021 budget
was prepared in the spring of 2020 In terms of COVID
protocols/mandates and how they would affect visitation,
we did not know what to expect for the coming year
Therefore, revenues and expenditures were budgeted below
prior years, anticipating low visitation for the summer of
2020 At that time, it really hit home how important tourism
dollars are to our overall budget A lean July, August,
and September reduced shared revenues, which are used
to provide essential services, by over $1 5 million (sales
tax, occupancy tax, land transfer tax) Fortunately, the
unexpected happened; the summer was one of the strongest
on record as visitors looked for ways to safely vacation in
small groups
During the fall of 2020, we were recording revenues
significantly above budgeted amounts and even above
the prior fiscal year! In the fall of 2020, the Board held
a strategic planning workshop, and much of the focus
included ideas to tackle the town’s aging infrastructure
including water, drainage, and streets The Board is now
MESSAGE FROM THE
MANAGER
By Town Manager Andy Garman
Legacy
We uphold our legacy by protecting and
promoting our small-town character that includes
a sustainable local economy based on family
vacation tourism, a high-quality beach experience,
and small, locally owned businesses
Fundamental to our legacy and quality of life are
preserving the historic architecture and culture
that distinguishes our town, providing residents
and visitors with excellent public services and well-
maintained recreational amenities; and ensuring
access to a well-protected natural coastal
environment Our legacy will be strengthened
and preserved by a focused, transparent decision-
making process that is comprehensive and
consistent with the community’s vision
To maintain that focus, our decisions are directed
by five Community Goals
Town of Nags Head Community Goals
1 Preserve our community’s distinctive heritage
and unique lifestyle
2 Protect our critical natural resources and
coastal ecosystem
3 Build and promote a sustainable economy that
supports residents and visitors
4 Plan for orderly and sustainable growth and
redevelopment
5 Maintain a well-run and efficient government
that provides high quality and cost effective
services
With those community goals as a baseline, the
Board and staff investigated the foreseeable
future and imagined what it would take for the
Town to be its best
This resulted in three areas of focus, which are
more detailed in the Strategic Plan
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 5
NAGS HEAD, NC
embarking on an infrastructure plan to repave all streets on a
neighborhood scale within a 20-year horizon Each project will
include replacement of waterlines and drainage as necessary
Additionally, the Board is developing a plan to replace our
aging Public Works complex, which supports our Facilities
Maintenance, Sanitation, Fleet Maintenance, Water
Distribution, Water Operations, and Administration divisions
This includes the brush yard and recycling center A master plan
is underway and project development will continue into FY 22
Our beaches are always a focus Now that the Town has
completed two nourishment projects, we are embarking on a
nourishment master planning effort that looks at programmatic
planning and permitting of nourishment activities for a 30-year
horizon The Town adopted additional municipal service districts
beginning in fiscal year 2022, which provide needed flexibility
for the Town to generate revenue to fund beach nourishment
projects Additionally, the Town continued planning for a post-
Dorian beach nourishment project, which is a FEMA funded
project scheduled for summer of 2022 Lastly, we are working
on a long-term plan to replace our numerous beach access
walkovers and bath houses to provide the best recreation
experience possible for residents and visitors The Town’s goal
is to have a long-term plan for shoreline management and
beach infrastructure that is financially, administratively, and
environmentally sustainable
Subsequent to the fall retreat, the Board of Commissioners
had a mid-year workshop in November with the intent of using
additional revenues to fund items previously cut from the
budget Again, the focus was getting the Town back in a good
position to replace aging infrastructure and equipment The
Board capitalized on the strong economy to fund a number of
vehicle replacements which will allow the Town to work towards
a more sustainable replacement schedule in future years In the
spring of 2021, the Board went through this exercise again, using
available revenue to fund additional equipment and planning
expenses for the Public Works complex and water and drainage
infrastructure projects Finally, Nags Head continues to fund
quality of life services, including sidewalks and bike paths, beach
access improvements, water quality initiatives, pedestrian safety
improvements, and events at our parks
Even with the events that caused the Town to pause in the first
part of FY 2021, Nags Head continued to provide a full suite
of services throughout the first pandemic year The shoulder
season grew in FY 2021 with visitation extending late into the
fall at unprecedented rates It appears this trend will continue,
at least through FY 2022, and we will monitor and adjust to
this new reality We have modified service levels accordingly,
including providing ocean rescue further into the fall season
We are evaluating changes to our sanitation and other public
works services due to the impacts of heavy visitation later into
the year We plan to fully leverage the opportunities created
by these changing conditions, including the federal and state
funding that will be available to the Town from the CARES and
ARP Acts, as well as the recently adopted North Carolina State
budget Our goal is always to provide you with a high return on
your tax dollars by being strategic and resourceful, allowing us
to provide quality, cost-effective services
We have a talented staff that is well positioned to meet new
challenges and a supportive Board that provides the resources
necessary to offer citizens the best services possible We are
excited for what the future holds for Nags Head and look
forward to what we can accomplish in the coming years
Stop in to our office sometime – we would be happy to talk to
you about what we do and how we can assist you
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 6
ACCOMPLISHMENTS
The Government Finance
Officers Association recognized
the Administrative Services
Department for its fiscal year
2020 reporting A Certificate
of Achievement for Excellence
in Financial Reporting was
awarded for the fiscal year
2020 Annual Comprehensive
Financial Report (ACFR) for the
5th consecutive year as well as
an Outstanding Achievement
in Popular Annual Financial
Reporting (PAFR) for fiscal year
2020 for the 4th consecutive year
Two lifesaving recognitions were awarded to Nags Head
Ocean Rescue for outstanding and heroic lifesaving actions in
dangerous surf conditions
Nags Head property owners will see a decrease in their flood
insurance premiums after officials at the Town worked to
increase the community’s flood insurance premium discount
from 20% to 25% under a program administered by FEMA’s
National Flood Insurance Program A voluntary incentive
program that recognizes and encourages community
floodplain management practices that exceed the minimum
requirements of the National Flood Insurance Program (NFIP),
FEMA’s Community Rating System has over 1,500 participating
communities In CRS communities, flood insurance premium
rates are discounted to reflect the reduced flood risk resulting
from the community’s efforts that address the three goals of the
program:
• Reduce and avoid flood damage to insurable property
• Strengthen and support the insurance aspects of the
National Flood Insurance Program
• Foster comprehensive floodplain management
Flood insurance rate maps (FIRMS) can be viewed on the
North Carolina Flood Risk Information System (FRIS) or the
Dare County Online GIS viewer
The Town’s resilience efforts were recently featured as a
case study by the American Flood Coalition in a guide
titled, Adaptation For All: How To Build Flood Resilience For
Communities Of Every Size Following the publication of the
guide, the American Flood Coalition hosted a virtual webinar
launch in March 2021 The webinar can be viewed at https://
www youtube com/watch?v=qPxtfEmztew As a follow up to
these efforts, the Town has been invited to become a member
the American Flood Coalition, a nonpartisan organization
advocating for solutions to flooding and sea level rise and is
comprised of 254 members from 20 states
Government Finance Officers Association
Award for Outstanding Achievement in Popular Annual Financial Reporting
Presented to
Town of Nags Head
North Carolina
For its Annual Financial Reportfor the Fiscal Year Ended
June 30, 2020
Executive Director/CEO
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 7
INITIATIVES
Resiliency
The Town maintains a
thriving, protective dune
ecosystem As the dune
system must be actively
managed to balance
engineering, recreational,
aesthetic and maintenance
needs, we value planting
native dune vegetation
for the establishment and
retention of protective dunes
along the oceanfront A
cost-share program has been
established and is available
to oceanfront property
owners that would like to
plant approved, native dune
vegetation on their properties
Grantees are eligible for
reimbursement of the cost
to purchase approved dune
vegetation plants
Collaborative research
efforts provide the Town
an opportunity to obtain
additional insight into
the advancement of
management strategies
and techniques for
the development of a
comprehensive and
sustainable resiliency
planning One such ongoing
study is a collaborative partnership between the Virginia
Institute of Marine Science, Virginia Commonwealth University,
and the U S Army Engineer Research & Development Center
The focus of this research work is to determine whether an
old dune is more resilient than an artificial dune through the
evaluation of ecological processes and the role they play in dune
stability Data will be integrated into numerical models, which
will allow for the exploration of specific applied research and
coastal management questions related to dune management
Improving our understanding of the oceanfront shoreline’s
response to storms will allow the Town to more effectively plan
and develop management strategies by leveraging resources in
working towards the advancement of becoming a more resilient
community
In addition, we were selected to participate in a collaborative
effort to address its unique energy resilience challenges and
goals Nags Head is one of just 11 competitively selected
communities across the nation to participate in the Energy
Transitions Initiative Partnership Project (ETIPP) of the
Department of Energy Through the ETIPP project, Nags Head
aims to advance its disaster resiliency by ensuring renewable
and other distributed energy resources are interconnected and
available locally during and following emergencies, such as the
hurricanes the area experiences Nags Head seeks to determine
opportunities to incorporate renewable and energy efficient
technology into the Town’s critical governmental facilities, with
the goal of being able to operate 48 to 72 hours off grid
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 8
Art and Culture
The creation and display of
art masts along South Virginia
Dare Trail are one of the
on-going initiatives of Nags
Head’s Committee for Arts
and Culture The Committee
asked four local artists to
participate in what we hope
to be the first installation
of many unique, locally-
created art pieces to display
in our community The four
completed art masts include:
1 A tribute to Glenn Eure,
painted by James Melvin,
is located at the Abalone
Street beach access
2 A Bodie Island Lighthouse
Rescue piece, painted by
Rob Snyder, is located at
the Baltic Street beach
access
3 A beach scene, painted by
Taylor Williams, is located
at the Blackman Street
beach access
4 An On-Duty Lifeguard
piece, painted by Kerry
Oaksmith-Sanders, is
located at the Bonnett
Street public beach access
The Committee for Arts and
Culture hopes to continue
soliciting other art pieces
created by local artists to
display throughout the town,
so if you are a local artist and
are interested in participating,
please contact Planning
Director Kelly Wyatt
Kelly Wyatt@nagsheadnc gov
1
3
2
4
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 9
Capital Improvements
Construction of a new wood framed dune walkover was
completed at the Admiral Street public beach access This
addition provides a separate means of pedestrian access to the
beach to decrease potential pedestrian and vehicular conflicts
The Town continues to focus on strengthening its drainage
infrastructure through scheduled, remedial and capital
improvements projects Several replacement projects were
conducted along West Danube Street and the intersection
of South Wrightsville Avenue/East Barnes Street A new
stormwater branch line was installed in connection with the
West Danube Street project, extending back through to
Kipper Court Facilities Maintenance personnel continue to
aggressively pursue routine maintenance through scheduled
and remedial work activity
To sustain reliable operations, we continue to fund water
projects outlined in our Water Master Plan, which identifies
future capital needs The replacement of asbestos cement
water lines in the Town’s water distribution system is an initiative
in the ten-year capital improvement plan recommending
replacements throughout town each year This year, 2,126 feet
of asbestos cement water line on Wrightsville Avenue were
replaced
Additionally, our Water Distribution department:
• Installed 1 new fire hydrant
• Installed 30 new water services
• Replaced 42 meters with usage over 3 million gallons
• Completed 70 water service repairs and 2 water main
repairs
• Performed 1,847 locates for NC 811, a non-profit
information center that provides utility locations to anyone
engaged in excavation work
Septic Health
Approximately 80% of Nags Head’s properties use an on-site
sewage system also referred to as a septic system The Town
offers free services and financial assistance to homeowners
for having systems pumped out, repaired, or replaced through
the Todd D Krafft Septic Health Initiative Program The free
services include:
• Water quality testing
• System inspections to detect problems early, and a follow-
up report that outlines whether your system needs pumping
or maintenance
• Low-interest loans (up to $7,500) for septic system repairs
and replacements
• Property owners can receive a $45 credit on their water
account for pumping their system
• To request an inspection, please visit the Septic Health
Initiative web page
The Town is updating its Decentralized Wastewater
Management Plan Originally created in 2005, the Plan is a
part of the Todd D Krafft Septic Health Initiative Program
Tetra Tech, a consulting firm, is partnering with the Town
to spearhead this project Experts from the Coastal Studies
Institute, East Carolina University, and North Carolina Sea
Grant will also be a part of the consultant team The update
will evaluate the overall effectiveness of the plan and the Town’s
Septic Health program, recommend additional measures
as necessary, and expand and integrate the plan Staff will
be assisted by an advisory team of community members
appointed by the Nags Head’s Board of Commissioners Nags
Head’s current plan will be adapted to ensure property owners’
investments and coastal water quality continue to be protected
New management tools will be applied using the findings from
years of data collection and real-world experience to help
Nags Head manage wastewater in its dynamic geological and
environmental setting for years to come
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 10
Flood Outreach
The Town has installed an enhanced flood warning system
immediately south of milepost marker 17 along South Old
Oregon Inlet Road to address public safety issues in an area
prone to roadway flooding Solar powered LED-enhanced
warning signs, with connectivity to a pressure transducer sensor,
monitor the water surface level in the surrounding area When
the sensor detects water levels exceeding a predetermined
threshold, a signal activates the flashing LED enhancement
lights on the signs Once water levels fall below the sensor
threshold, the system is deactivated An integrated data logger
records, processes, and transmits flood warning data, providing
enhanced data collection for future planning efforts
iFlood is a partnership between researchers at the Woods Hole
Oceanographic Institution, the Town of Nags Head, and the
Town of Duck, to document and improve flooding predictions
along the Outer Banks Citizen-scientist flood reports submitted
by you, the app user, provide our research team with data about
the location and timing of flooding that help us document where
it is occurring and improve models for flooding owing to ocean
storms and rainfall For more information on iFlood, check out
a presentation by scientists at Woods Hole Oceanographic
Institute Download the iFlood App for iOS or the iFlood App for
Android
Beach Nourishment
Nags Head is committed to developing long-term beach
nourishment plans to maintain our most valuable physical
asset The basis for pursuing the master plan is outcome-based
beach management, with a consistent level of protection along
the shoreline Results include supporting long-term financial
planning, identifying volumetric triggers for renourishment,
managing areas of higher erosion, planning nourishment
intervals based on modeling, and working with nature while
being agile in coordinating with regional partnerships and
dredging market conditions
Waste Reduction
In partnership with TFC Recycling, Nags Head rolled
out a subscription-based curbside recycling service to all
homeowners
You can sign up
online for the
TFC Curbside
Recycling Service
or email them
at nagshead@
tfcrecycling
com Nags Head
also offers ABC
glass and card
board recycling
collection for
commercial
businesses
Communication/Transparency
Staff continues to improve our online and electronic platforms,
publicize the availability of resources, and refine documents to
provide guidance to the Town’s customers Examples include
online permitting for residential and commercial building
permits as well as beach driving permits (from October 1
through April 30) The Town provides property owners and
residents with a variety of electronic services, including financial
institution online bill payment with next day settlement, online
bill pay, and free e-billing and automatic draft for water bills,
real property taxes, and business licenses and registrations
Additionally, the public is invited to sign up to receive Town
alerts when there are changes to items such as agendas, street
and beach closures, water services, beach nourishment, and
sanitation schedules
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 11
Grants
A Public Assistance Grant
was awarded by the Federal
Emergency Management
Agency (FEMA) in the
amount of $12.9 million
This grant, combined with
a North Carolina Division
of Water Resources Coastal
Storm Damage Mitigation
grant in the amount of $1.4
million, will aid in oceanfront
restoration efforts sustained
from Hurricane Dorian The
funds will be applied towards
a beach renourishment project
scheduled for the spring/
summer of 2022
The Town recently completed
construction of a pedestrian
sidewalk project through the
Shoppes @ 10 5 commercial
development, providing
enhanced pedestrian
connectivity from the
intersection of Adams Lane
and South Croatan Highway
through to the intersection
of Wrightsville Avenue and
Admiral Street This project
was identified as a high priority
in the Town’s Pedestrian Plan
to provide critical links between
neighborhoods, key commercial
corridors and recreational amenities such as oceanfront
and soundfront accesses Project funding sources include
a Tourism Impact Grant from the Outer Banks Tourism
Board in the amount of $40,000
A new beach access was added to the Town’s inventory
at Islington Street, south of the Outer Banks Pier
Improvements to the project site include vehicular access,
pervious concrete grid paver parking stalls, supplemental
landscaping, shower station, bike rack, and supporting
infrastructure improvements The project was funded
in part from a Division of Coastal Management Public
beach and Access Grant in the amount of $47,232
The Town of Nags Head was
selected as a recipient of a
National Fish and Wildlife
Foundation (NFWF) grant
for $75,000 to support the
development of an Estuarine
Shoreline Management Plan
for Nags Head The plan will
use scientific analysis and data
gathering to determine the
best living shoreline approach
for each portion of the town’s
soundside shorelines Further,
the plan will propose overall
policy and management
recommendations appropriate
for adjacent land uses, examine
legal issues, and explore how
sea level rise will impact the
long-term management of
the estuarine shoreline Once
complete, this plan will provide
the Town with an action list
of shovel ready projects that
can easily be incorporated in
the yearly budget and Capital
Improvement Plan The Coastal
Studies Institute will partner
with the Town on this project to
collect and analyze information
about the depths and shapes
of underwater terrain The
National Coastal Resilience
Fund restores, increases,
and strengthens natural
infrastructure to protect our coastal community
One of the most recognized, and critical, tools of the fire
service is the firefighter’s self-contained breathing
apparatus (SCBA), which is used as protection from
dangerous heat and toxic smoke and keep firefighters safe
when they are performing their duties Replacing air packs
can be a very costly project for a community Through
FEMA’s Assistance to Firefighters Grant, a program that
provides funding to fire departments across the United
States, Nags Head Fire Rescue upgraded and replaced all
its self-contained breathing apparatuses using $243,510
in grant funds
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 12
NET
POSITION
Net position presents the
financial position of the Town as
a whole
The assets and deferred
outflows of resources of the
Town of Nags Head exceeded
its liabilities and deferred
inflows of resources at the close
of the fiscal year by $61,287,593
(net position)
Over time, increases or
decreases in the Town’s net
position may serve as a useful
indicator of whether the
financial condition is improving
or deteriorating
There are three components of
net position:
1 Net investment in capital
assets-largest portion of
net position that reflects
the Town’s investments in
capital assets (e g , land,
buildings, machinery,
and equipment) less any
related debt outstanding
issued to acquire those
items, net of unexpended
debt proceeds The Town
uses these capital assets to
provide services to citizens;
consequently, these assets
are not available for future
spending
2 Restricted-represents
resources that are subject
to external restrictions on
how they may be used
3 Unrestricted-remaining
balance that may be used
to meet the Town’s ongoing
obligations to citizens and
creditors
GOVERNMENTAL
ACTIVITIES
2021 2020 2019
NET POSITION:
Net investment in capital assets $36,284,111 $40,161,631 $25,110,090
Restricted $ 11,184,939 $11,135,803 $20,760,822
Unrestricted $4,724,498 $3,379,930 $6,504,243
Total net position $ 52,193,548 $54,677,364 $52,375,155
BUSINESS-TYPE ACTIVITIES
2021 2020 2019
NET POSITION:
Net investment in capital assets $5,008,907 $6,462,459 $6,084,121
Restricted $45,506 $29,815 $20,747
Unrestricted $4,039,632 $2,788,642 $2,904,685
Total net position $9,094,045 $9,280,916 $9,009,553
TOTAL GOVERNMENT-WIDE FINANCIAL ANALYSIS OF NET POSITION
(INCLUDING GOVERNMENTAL AND BUSINESS-TYPE ACTIVITES)
2021 2020 2019
NET POSITION:
Net investment in capital assets $41,293,018 $46,624,090 $31,194,211
Restricted $11,230,445 $11,165,618 $20,781,569
Unrestricted $8,764,130 $6,168,572 $9,408,928
Total net position $61,287,593 $63,958,280 $61,384,708
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 13
2021 2020 2019 2021 2020 2019 2021 2020 2019 2021 2020 2019
Net investment in
capital assets
Restricted Unrestricted Total net position
$70,000,000
60,000,000
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
0
$41,293,018 (-11 43%)
$11,230,445 (+ 58%)
$8,764,130 (+42 08%)
$61,287,593 (-4 18%)
As of June 30, 2021, the Town of Nags Head is able to report
positive balances in all three categories of net position, for the
government as a whole, as well as its governmental activities
(general fund and beach nourishment capital project funds)
and net effect of its business-type activities (water fund) The
same situation held true for the prior fiscal year
The Town’s total net position decreased by $2,670,687
In spite of increases in unrestricted net position, the net
investment in capital assets portion of net position for both
governmental and business-type activities decreased
The total governmental activities net position decreased by
$2,483,816
Depreciation of $7,509,291 was taken on the Town’s 2019
beach nourishment project
The Town’s liability restricted from outstanding debt related
to the acquisition of capital assets decreased by $2,443,911
due to the debt payment made towards financing that
project
The total water fund net position decreased by $186,871
The water fund owned land that was more appropriately
owned by the general fund, which carried an additional
donated value
This lead to a $1,453,552 decrease in the water fund net
investment in capital assets
Net Position Government-Wide Financial Analysis
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 14
THE GENERAL
FUND
General Fund Balances
The focus of the general fund is to provide
information on near-term inflows, outflows,
and balances of usable resources Such
information is useful in assessing the Town
of Nags Head’s fiscal position Specifically,
unassigned fund balance* can be a useful
measure of the Town’s net resources
available for spending at the end of the
fiscal year
The general fund is the chief operating
fund of the Town of Nags Head The fund
balance in the general fund is similar to a
savings plan in that it represents monies which remain unspent
after all budgeted expenditures have been made Fund Balance
is one indicator of fiscal stability that is measured at year-
end The Town strives to use fund balance only in the event of
unforeseen circumstances , emergencies, and one-time uses
The Town’s policy states a goal of keeping a minimum
unassigned fund balance, or portion of fund balance with no
restrictions, commitments, or assignments to specific purposes,
equal to 50% of general fund expenditures and transfers out to
other funds, less beach nourishment debt of $2,521,353, but no
less than $5,000,000
At the end of the current fiscal year, the Town’s unassigned fund
balance in the General Fund was $8,185,984, representing
39% of general fund expenditures and transfers, less beach
nourishment debt Total fund balances in the general fund
reached $19,815,156
2021 2020 2019
Total Fund Balances $19,815,156 $19,968,387 $28,416,589
Unassigned Fund Balance $8,185,984 $8,634,215 $6,981,462
General Fund expenditures
and transfers (less beach
nourishment debt)
$20,988,594 $17,908,739 $17,801,872
Unassigned Fund Balance
as a percentage of
expenditures and transfers
(less beach nourishment
debt)
39 00%48 21%39 22%
Total Fund Balances Unassigned Fund Balance General Fund expenditures and transfers
(less beach nourishment debt of $2,521,353)
$30,000,000
28,000,000
26,000,000
24,000,000
22,000,000
20,000,000
18,000,000
16,000,000
14,000,000
12,000,000
10,000,000
8,000,000
6,000,000
4,000,000
2,000,000
0 2020 2019 20202021 20192020202120212019
$19,815,156 (- 77%)
$8,185,984 (-5 19%)
$20,988,594 (+17 2%)
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 15
General Fund Notes
The unassigned fund balance decrease of
5 19% from fiscal year 2020 to fiscal year
2021 is attributed to using $316,712 of fund
balance to supplement revenues in the fiscal
year 2022 budget to create a balanced
budget
This resulted in an increase in assigned fund
balance*, thus reducing unassigned fund
balance
While the total fund balance change is less than 1%, the Board
of Commissioners accomplished funding strategic initiatives
after the budget was adopted
Upon diligent budget monitoring and staying within our fund
balance policy, the budget was amended to pay for these items
including:
To address maintenance and improvements to streets and
drainage infrastructure, $650,000 was earmarked for
streets and stormwater
Maintaining the Town’s assets is a priority for the Board;
therefore $1,192,237 was used to repair and replace buildings
and vehicles as well as perform design work
The Board of Commissioners formalized the general fund’s
purchase of land from the water fund for $872,532 The
land was more appropriately owned by the general fund
Revenues including occupancy, land transfer, and sales taxes
came in $2,110,417 over budget and were used to partially offset
these costs
These revenues were budgeted conservatively resulting from
the unknown impact COVID-19 would have on our tourism
driven economy
By state statute, counties are required to perform real
property revaluations no less than every eight years A
reappraisal of our property tax base was completed in fiscal
year 2021
To help taxpayers compare tax rates before and after
reappraisals, state statute requires the publication of the
revenue-neutral tax rate, or the tax rate that produces the
same amount of tax revenue from the new revaluation
Although the revenue-neutral tax rate was adopted, a
higher-than-anticipated tax collection rate and a lower-
than-anticipated percentage of appeals resulted in town-
wide ad valorem tax revenues coming in approximately
$400,000 over budget Additionally, per state statute, the
revaluation includes a growth factor in the calculation of the
revenue neutral rate
General fund expenditures and transfers (less beach
nourishment debt of $2,521,353) increased by 17 20%, primarily
attributed to the establishment of two new capital project funds
for the purpose of beach nourishment
The capital reserve fund is a legally consolidated fund that is
restricted* in general fund balance for future capital projects,
including beach nourishment
Funds totaling $1,738,822 were transferred from the
capital reserve fund to establish the Beach Nourishment
Maintenance Capital Project Fund for the purpose of a 2022
beach nourishment project
Funds totaling $1,319,568 were transferred from the capital
reserve fund to establish the Beach Nourishment Master
Plan Capital Project Fund for the purpose long-term beach
nourishment planning
These transfers accounted for the decrease in unassigned
fund balance as a percentages of expenditures and
transfers, less beach nourishment debt In fiscal year 2020
no transfers were made
*Fund balance classifications disclose the hierarchy of constraints placed on how fund
balance can be spent When less constraints are placed on fund balance, unassigned
fund balance may increase Restricted fund balance includes amounts that are restricted
for specific purposes, imposed externally by creditors or by law Assigned fund balance
includes amounts that Nags Head’s Board of Commissioners has determined to use for
specific purposes
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 16
GENERAL FUND REVENUE SOURCES 2021 2020 2019
Ad valorem property taxes $9,724,927 $9,199,976 $8,869,938
Other taxes and licenses (total) $9,398,513 $6,288,313 $6,366,165
Occupancy tax $4,152,935 $2,741,871 $2,870,519
Sales tax $3,546,353 $2,761,461 $2,721,543
Land transfer tax $1,639,383 $719,914 $711,883
Other taxes and licenses $59,842 $65,067 $62,220
Unrestricted intergovernmental $918,654 $932,135 $960,846
Restricted intergovernmental (total) $1,335,413 $9,036,209 $9,436,546
Restricted federal grants $512,499 $5,863,751 $6,504,990
Restricted state grants $146,458 $2,013,498 $2,669,372
Restricted local grants $676,456 $1,158,960 $262,184
Permits and fees $358,100 $268,293 $300,228
Sales and services $99,103 $106,977 $66,091
Net investment earnings ($95,026) $457,095 $616,182
Miscellaneous $207,365 $191,700 $185,920
TOTAL REVENUES $21,947,049 $26,480,698 $26,801,916
General Fund Breakdown
The General Fund accounts for a majority of Town services and is
Nags Head’s primary operating fund
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 17
Taxes
The ad valorem tax rate was adopted with a revenue-neutral
tax rate of $ 265 cents per $100 of assessed valuation
Of this rate, $ 0255 cents is restricted by the Board for beach
nourishment Flat rate contributions of $200,000 and
$1,050,000, respectively, are restricted by the Board for parks
and paths and streets and stormwater management Due
to the revaluation, the town-wide total property valuation
increased by $645,445,481 from fiscal year 2020, or over
26%
The municipal service district (MSD) tax rate restricted for the
purpose of beach nourishment also adopted a revenue-neutral
tax rate of $ 143 cents per $100 of valuation Due to the
revaluation, the town-wide total property valuation increased
by over 28% for MSD taxes, compared to fiscal year 2020
The tax collection rate was budgeted at a relatively modest
98 5% to account for COVID-19 unknowns The total town
wide levy collection percentage for fiscal year 2021 was
99.954%, due to continued diligence in the collection of
property taxes As a point of reference, the statewide average
in fiscal year 2021 was 98 96%
Tourism driven revenues including sales, occupancy, and land
transfer taxes came in at 28%, 51%, and 128%, respectively,
over the prior fiscal year Combined, these revenues were 47%
higher, or $3,003,014, compared to the prior fiscal year
Resricted Intergovernmental
The Town worked with FEMA and the state of North Carolina
to receive grant funding of $16,233,837, as a result of Hurricane
Matthew (2016), towards a 10 mile beach nourishment
restoration project that spanned over the prior two fiscal years
and was completed in August 2019
Investment Earnings
Negative investment income was recorded due to an unrealized
fair market value loss, which was less than realized income due to
declining interest rates
Dare County gross occupancy tax Locally collected portion of sales tax within Dare County Dare County gross land transfer tax
$45,000,000
40,000,000
35,000,000
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0
Local travel and tourism-based revenues are the Town’s
highest revenue sources behind property tax and are good
economic indicators of our tourism-driven economy
2020 2019 20202021 20192020202120212019
$43,819,792 (+50 27%)
$20,996,848 (+12 94%)
$17,017,085 (+126 43%)
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 18
Current expenditures are the necessary payments used to maintain and
run the Town, while capital expenditures are asset purchases that have
initial useful lives beyond a single reporting period
General Government 2021 2020 2019
Governing Body CURRENT $117,769 $144,952 $166,641
CAPITAL OUTLAY - - -
The Board of Commissioners is responsible for establishing policies,
initiating legislation, and providing for the general welfare of Nags Head’s
residents and visitors The Board’s goals include providing for a transparent
government, assuming the Town’s fiscal responsibility, and providing
opportunities for businesses and citizens to express view points and be
involved in the decision-making process
Administration (Town Manager) CURRENT $700,014 $932,954 $851,705
CAPITAL OUTLAY $6,800 $3,200 $2,463
Administration is responsible for implementing policies set by the governing
body and ensures compliance with state and federal laws and regulations
The Town Manager’s office provides employees with a platform that allows
for objective discussion of innovative ideas
Administrative Services (Finance and Human Resources) CURRENT $900,715 $805,285 $839,337
CAPITAL OUTLAY 1,956 $89,991 $88,116
Administrative Services is responsible for all accounting and financial
reporting requirements, financial policies, internal controls, and ensuring
budget compliance This department oversees implementation and
execution of employee relations including human resources policies and
programs, coordination of employee benefits, and recruitment and retention
in order to empower a highly qualified workforce dedicated to delivering
consistent and exemplary services
Information Technology CURRENT $370,215 $342,429 $276,731
CAPITAL OUTLAY - $29,544 -
The Information Technology Department provides the administration
and support of all areas of information technology in order to support the
delivery of high quality, efficient, and cost-effective services The Department
provides solutions to ensure the preservation and security of Town data as
well as to ensure smooth operation of government
GENERAL FUND
EXPENDITURES
BY GOVERNMENTAL
FUNCTION
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 19
2021 2020 2019
Planning and Development CURRENT $923,531 $834,667 $770,972
CAPITAL OUTLAY $604,259 $1,034,983 $26,724
The Planning and Development Department works to implement growth,
development, and quality of life in Nags Head The Department supports
fair application of ordinances and local involvement in decision-making
Capital expenditures this year included completion of the multi-use
path.
Legal services CURRENT $102,894 $110,442 $90,943
Legal services include litigation, real estate transactions, and drafting
legal documents and ordinances The Town Attorney is paid on a monthly
retainer and is appointed by the Board of Commissioners
TOTAL GENERAL GOVERNMENT - CURRENT $3,115,138 $3,170,729 $2,996,329
TOTAL GENERAL GOVERNMENT - CAPITAL OUTLAY $613,015 $1,157,718 $117,303
Public Safety
Police CURRENT $2,679,209 $2,438,679 $22,396,323
CAPITAL OUTLAY $494,988 $217,818 $143,478
The Nags Head Police Department is a full-service law enforcement
agency that proudly serves the residents and visitors of our community The
Department strives to be a contributing factor in creating a better quality of
life through proactive policing, with an emphasis on community relations
The Department places its highest value on the preservation of human life,
the protection of property, and service to humankind The Town replaced
its portable and mobile radios and police vehicles as part of capital
expenditures.
Fire CURRENT $2,778,030 $2,519,279 $2,442,540
CAPITAL OUTLAY $329,117 $906,999 $63,480
Ocean Rescue CURRENT $633,782 $568,738 $579,656
CAPITAL OUTLAY $110,763 $9,500 $60,722
Fire and Rescue ensures that emergency responses to fires, medical
emergencies, technical rescues, and other natural and man-made disasters
are corrected in the safest and most professional and efficient manner
possible promoting the preservation of human life and protection of
property The Department continues to evolve in response to the community
and proactively adjust services to meet all customer needs Capital
expenditures this year included the purchase of SCBA air packs and
800 MHz radios.
TOTAL PUBLIC SAFETY - CURRENT $6,091,021 $5,526,696 $5,418,519
TOTAL PUBLIC SAFETY - CAPITAL OUTLAY $934,868 $1,134,317 $267,680
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 20
Public Works 2021 2020 2019
Administration CURRENT $320,782 $300,165 $350,016
CAPITAL OUTLAY $10,004 $164,905 $48,636
Public Works Administration provides departmental coordination in order to
carry out projects that support community needs
Public Facilities Maintenance CURRENT $1,327,232 $1,180,957 $1,006,224
CAPITAL OUTLAY $1,142,961 $695,610 $1,500,995
Facilities Maintenance proudly maintains the overall appearance and
cleanliness of the Town’s facilities and grounds and promotes maintenance
and development of livable, well-maintained neighborhoods, and
infrastructure Capital expenditures include purchasing land from the
water fund, Islington and Admiral Street Beach access improvements,
and the Public Works Master Plan design
Maintenance Garage CURRENT $284,188 $275,508 $269,769
CAPITAL OUTLAY - - -
Fleet Maintenance provides efficient cost-effective maintenance of
Town vehicles and equipment in order for other departments to provide
uninterrupted service to the Town
TOTAL PUBLIC WORKS - CURRENT $1,932,202 $1,756,630 $1,626,009
TOTAL PUBLIC WORKS - CAPITAL OUTLAY $1,152,965 $860,515 $1,549,631
Environmental Protection
Sanitation CURRENT $992,084 $1,097,240 $1,018,324
CAPITAL OUTLAY $301,727 $326,139 $175,718
Solid Waste Tipping Fees CURRENT $828,826 $652,606 $634,974
Sanitation and Solid Waste collect commercial and residential refuse,
including bulk, brush, vegetative debris chipping and mulching, and
recycling Through our collection programs, 9,159 tons of solid waste,
297 tons of recycling, 874 tons of C&D, and 4,441 tons of bulk/brush
yard waste were collected. These tipping fees are included in current
expenditures. A front load commercial trash truck was purchased in
capital expenditures.
TOTAL ENVIRONMENTAL PROTECTION - CURRENT $1,820,910 $1,749,846 $1,653,298
TOTAL ENVIRONMENTAL PROTECTION - CAPITAL OUTLAY $301,727 $326,139 $175,718
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 21
Streets and Drainage 2021 2020 2019
State Street Aid CURRENT $10,337 $19,766 $5,104
CAPITAL OUTLAY - $165,360 $112,805
State Street Aid funding maintains and develops infrastructure in order to
increase traffic safety through improvements and expansions
Streets and Stormwater Management CURRENT $28,642 $90,474 $45,771
CAPITAL OUTLAY $293,035 $355,199 $749,044
The Streets and Stormwater Management program addresses maintenance
and improvements to the town’s streets and drainage system on a life cycle
basis A list of drainage and waterline projects will be planned in conjunction
with maintenance to all town owned streets (37 miles) over a period of
20 years Street projects were combined into the previous stormwater
management program through a $1,050,000 appropriation Through
Board action, any unspent revenues that accumulate each year must be
restricted in the general fund balance for the purpose of supporting the
town’s street and drainage infrastructure Capital improvement work
included West Danube Street drainage infrastructure.
TOTAL STREETS & DRAINAGE - CURRENT $38,979 $110,240 $50,875
TOTAL STREETS & DRAINAGE - CAPITAL OUTLAY $293,035 $520,559 $861,849
Debt Service
PRINCIPAL $3,816,920 $20,022,960 $1,293,230 INTEREST $340,777 $826,491 $41,431
The Town’s debt service represents payments on installment finance
purchase agreements Total direct installment finance purchases
decreased to an outstanding balance of $10,398,958 in fiscal year
2021 from $12,842,869 in fiscal year 2020, attributable to the debt
payment of $2,276,000 made toward the 2019 beach nourishment
project. In the prior fiscal year, Nags Head repaid debt principal
totaling $18,509,837 and interest totaling $744,264 for the purpose
of beach nourishment maintenance.
TOTAL DEBT SERVICE $4,157,697 $20,849,451 $1,334,661
Other Financing Uses $3,058,390 - $1,750,000
This includes transfers from the General Fund to the Beach Nourishment
Capital Project Funds Municipal Service Districts (MSDs, or special
taxing districts) and town-wide beach nourishment taxes were transferred
to establish two new beach nourishment capital project funds: a 2022
restoration project as a result of Hurricane Dorian and a long-term beach
nourishment capital planning fund for beach management
TOTAL EXPENDITURES $23,509,947 $37,162,840 $17,801,872
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 22
CAPITAL RESERVE FUND
The Town has a legally adopted Capital Reserve Fund which sets aside and accounts for the accumulation of funds for designated future capital projects including recreation, street and drainage, and shoreline project uses The accumulation of funds set aside in the Capital Reserve Fund are restricted for those specific purposes and are generated through ad valorem taxes and various fees The Capital Reserve Fund is consolidated in the General Fund The projects that accumulate funds in the Capital Reserve include:
2021 2020 2019
Facility fees $69,693 $55,640 $109,920
Facility fee are generated by construction occurring within the Town Specific
purposes include Administration, Police, Fire, Sanitation, and Recreation
They are to be used in developing community service facilities the Town
provides This year facility fees were used to pay debt payments that fund
capital expenditures associated with increased services necessitated by new
development Permit fees and interest added $25,203 to the facility fees
funds
Beach Nourishment $4,963,997 $7,274,922 $8,343,599
Beach nourishment funds are generated from town-wide and municipal service district (MSD) ad valorem taxes as well as a portion of sales tax distribution In fiscal year 2021, the town-wide beach nourishment portion of ad valorem taxes remained at a revenue-neutral rate of $ 0255 cents per hundred of valuation,generating $685,380 in revenue, including interest The MSD tax was adopted at the revenue-neutral rate of $ 143 cents generating an additional $1,487,110 in revenue, including interest These funds were used towards the locally funded portion of beach nourishment debt Additionally, $3,058,390 in total was transferred to establish the two new beach nourishment capital project funds to be used towards initial engineering and design costs for a 2022 restoration project as well as to fund long-term beach nourishment planning Sales tax received that is legally restricted by state statute for beach nourishment totaled $496,327, including interest All beach nourishment funds are designated by the board to be spent for future beach nourishment maintenance and debt payments
Parks and Paths $66,313 $75,580 $33,832
During 2021, $200,000 of the town’s ad valorem taxes was restricted for
the Town’s parks and paths fund, which is designated by the board to be
spent for future town parks, multi use paths, beach accesses, and general
recreation/open space capital needs Parks and paths funds were used
towards the multi-use path debt repayment
Streets and Stormwater Management $782,035 $194,278 $142,235
This year’s budget combined streets and stormwater projects to achieve a more holistic approach in addressing maintenance and improvements to the town’s street and drainage system on a life cycle basis (previously just stormwater was included) The Town earmarked $1,050,000 to be used specifically for these types of projects These funds were used for the debt payment of three large-scale drainage infrastructure improvements and construction and design for pipe replacements and swale and storm drainage systems
Total fiscal year end balances $5,882,038 $7,600,420 $8,629,586
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 23
WATER FUND
The Town uses the Water Fund to account for the Town’s water system operations This fund operates in a manner similar to private
business enterprises
The costs (including depreciation) of providing water services to customers on a continuing basis are financed primarily through
user charges
Water is billed every two months The minimum water bill up to 3,000 gallons for a 3/4” meter size is $37 90
Water Fund Operating Revenues 2021 2020 2019
Water sales $3,664,298 $3,318,439 $3,028,910 Tap and connection fees $19,530 $14,300 $25,895 Late payments including penalties and interest $24,610 $28,952 $29,527 Water cutoff tag fees $5,400 $3,900 $4,100 Miscellaneous $4,220 $2,193 $1,982
Total Operating Revenues $3,718,058 $3,367,784 $3,090,414
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 24
Water Fund Operating Expenses 2021 2020 2019
Water Administration $284,699 $291,154 $279,289
Water Administration bills and collects revenues generated through
distribution of water resources to the citizens of Nags Head This department
provides courteous collection and timely response to customer inquiries
Septic Health $124,931 $163,066 $194,592
The Septic Health Program advocates the education of water quality to
maintain the Town’s wastewater infrastructure and improve private septic
system performance in order to promote a healthy environment and protect
the Town’s water resources
Water Operations $1,905,407 $1,816,385 $2,039,894
Water Operations monitors water quality into the Town’s distribution system
in order to ensure that water quality is in compliance with state and federal
regulations
Water Distribution $648,020 $562,659 $512,524
Water Distribution maintains and improves the Town’s water system,
including meter reading, gradual change out of old water meters, flushing
lines and installing and repairing water taps and lines
Depreciation and amortization $360,225 $352,818 $353,073
Total Operating Expenses $3,323,282 $3,186,082 $3,379,372
Although water rates did not increase, utility sales rose 10% or
$345,859 which contributed to operating income of $394,776,
a $213,074 or 117% increase over the prior year
The wholesale water rate increased from $1 92 to $2 152 per
million gallons purchased, or by 11 85% The rate is set by an
interlocal agreement with Dare County and was driven by a
total decrease in gallons in the prior fiscal year and an increase
in eligible capital costs
Gallons purchased from Dare County increased by 50 74
million gallons, or 13% Due to both the wholesale water rate
increase and an increase in usage (gallons purchased), the
cost of wholesale water purchased increased by $203,703 or
approximately 27% The usage increase reflects the increase in
tourism
Nags Head continues to fund water projects as outlined
in our water master plan, which identifies future capital
needs This year, projects included asbestos cement pipe
(ACP) replacements and design work for ACP replacements
coinciding with paving and drainage work scheduled in
Old Nags Head Cove in 2022 Federal grant funds totaling
$43,000 were used towards a 6” pump to assist with
dewatering applications
The Water Capital Reserve Fund was established in order
to assist with future water capital improvements and debt
payments as identified in the water master plan System
development fee capital contributions are accounted for here
and are restricted by State Statute for the specific purpose
of funding these improvements related to the Town’s water
system The Water Capital Reserve Fund is consolidated
in the Water Fund The Town received $15,930 in capital
contributions that were set aside in this fund in fiscal year
2021 for a total of $45,506 accumulated in this fund
TOWN OF NAGS HEAD POPULAR ANNUAL FINANCIAL REPORT 2021 | 25
Revenues 2021 2020 2019 2018 2017
Restricted intergovernmental grants $13,943 - $9,127,577 $645,779 -
Investment earnings $29,360 $114,594 $278,699 $16,097 $9,476
Expenditures 2021 2020 2019 2018 2017
General government capital outlay $ 952,241 $15,639,548 $22,988,632 $864,355 $385,334
Other Financing Sources:
Installment financing - - $27,613,837 - -
Transfers from the general fund $3,058,390 - $ 1,750,000 $12,000 $2,674,211
Sale of capital assets - $22,448 - - -
Fund Balance $4,477,581 $2,386,849 $17,889,355 $2,107,874 $2,298,353
BEACH NOURISHMENT
CAPITAL PROJECT FUNDS
Three beach nourishment capital project funds are
consolidated Governmental Funds for reporting
purposes
These multi-year funds remain in effect until their
respective projects are complete and are established for
the purpose of beach nourishment including:
A fund was established in 2017 for the purpose of
combining a planned locally funded beach nourishment
maintenance project with a federal and state funded
restoration project
Although this project is complete, it remains open to
finish post-construction work in order to maintain eligibility
for future FEMA assistance funds
Two funds were established in 2021 to account for a federal
and state funded restoration construction project occurring
in the summer of 2022 and to assist with long-term
planning in maintaining and enhancing the protective and
recreational capacity of the Town’s beaches
In addition to grants, town-wide, MSD, and restricted sales
taxes are funneled through the capital reserve fund to locally
fund these projects
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