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HomeMy WebLinkAboutCity of Foley - Public Financial Report 1 City of Foley, Alabama Popular Annual Financial Report For the year ended September 30, 2021 2 About this Financial Report The Foley Financial Services Division is pleased to present the City of Foley’s Popular Annual Financial Report (PAFR). The purpose of the PAFR is to present a user friendly summary of the City’s financial operatfons. It is designed to make the City’s finances easier to understand and to communicate to citfzens where dollars come from and how they are spent. Informatfon in the PAFR is taken from the City’s Annual Comprehensive Financial Report (ACFR) that is prepared in conformance with Generally Accepted Accountfng Principles (GAAP) and includes financial statements. The GAAP basis of presentatfon in the ACFR includes the City’s component units and individual funds, as well as the notes to the financial statements that disclose all financial and non-financial material events. Unlike the ACFR, the PAFR excludes component units in order to focus on the primary government. The ACFR, PAFR and the City’s most recent budget (FY2022) can be found at the web address below. Questfons about any of the reports or requests for additfonal financial informatfon should be addressed to the City of Foley Finance Director, P.O. Box 1750, Foley, Alabama, 36536. https://www.cityoffoley.org/YourGovernment/FinancialServicesDivision Government Finance Officers Association Awards Certificate of Achievement of Excellence in Financial Reporting The Government Finance Officers Associatfon (GFOA) awarded a Certfficate of Achievement for Excellence in Financial Reportfng (valid for one year only) to the City of Foley, Alabama, for its comprehensive annual financial report for the fiscal year ended September 30, 2020. This was the eighth consecutfve year that the City achieved this prestfgious award. Distinguished Budget Presentation Award The Government Finance Officers Associatfon (GFOA) awarded a Distfnguished Budget Presentatfon Award (valid for one year only) to the City of Foley, Alabama, for its fiscal year 2022 budget. This was the third year that the city achieved this prestfgious award. Popular Annual Financial Report The Government Finance Officers Associatfon (GFOA) has given an award for Outstanding Achievement in Popular Financial Report for the fiscal year ended September 30, 2020. This was the second year that the City achieved this prestfgious award. We believe the current report conforms to the Popular Annual Financial Report requirements, and we are submitting it to the GFOA. Inside this issue: About this report 2 Our Community 3 Local Economy 4 General Financial Informatfon 5 Fund Balance 6 Where the Money Comes From 7 Where the Money Goes 8 Understanding the City’s Debt 9 Major Capital Projects 9 Statfstfcs & Operatfng Indicators 10 3 Our community was named for its founder, Chicago businessman John B. Foley, who in 1901 purchased between 40,000 and 50,000 acres of land in the area and sold it through the Magnolia Land Company. He persuaded the Louisville and Nashville Railroad to run a spur to the area by promising to pay for the crosstfes needed for the line. By 1905, the town was large enough to warrant a post office, and it incorporated in 1915. Foley was primarily a farming community served by the L & N Railroad via a depot and warehouse for farm products, notably potatoes. The current Depot serves as a museum and was constructed in 1909 to replace the original 1905 depot that was destroyed by fire. Our city government operates under a strong council- weak mayor form of government. The council is presided over by a president who is chosen by the council members and is also a votfng member of the council. The council votes on municipal ordinances to set rules, laws or statutes and resolutfons to establish policies or order that a specific actfon be taken. The mayor is not a votfng member of the council, although all ordinances and resolutfons are subject to the mayor’s veto power, which can then be overridden by a two-thirds vote of the council. Services provided to residents and businesses include general administratfon, sales and other local tax collectfon, police and fire protectfon, building inspectfons, licenses and permits, emergency preparedness and response, refuse collectfon, constructfon and maintenance of highways, streets and related infrastructure, recreatfonal and leisure actfvitfes and cultural enrichment and a general aviatfon airport. City employees currently service an estfmated populatfon of 21,777 over a thirty-four square mile radius. Our Community City of Foley 2021 Council Vera Quaites / Richard Dayton / Wayne Trawick, Council President / Ralph Hellmich, Mayor / Rick Blackwell / Charlie Ebert III, Council Pro Temp You can sign up to receive the City’s E-newsletter at https://visitioley.com/ and stay up to date on all City News! 4 Local Economy As a City in southern Baldwin County, our close proximity to beautfful white sandy beaches means that tourism plays an important role in our economy. According to the Alabama Department of Tourism's 2020 Economic Impact Report, Baldwin County's estfmated 6 million visitors represented 26.5% of all visitors to the State. In additfon, travel-related spending totaled $4.9 billion, while total travel-related direct and indirect earnings of $1.6 billion represented 34.8% of the statewide total. Baldwin County's total direct and indirect travel related employment of 50,787 represented 30.7% of all Alabama travel related employment. In additfonal to the tourism and retail industries, other major employment opportunitfes for residents include health care and manufacturing jobs. Foley’s populatfon has increased by 3,791 or 22.3% , in the last five years. Did you know: City Council meetfngs are held on the first and third Monday of each month. Currently, work sessions and council meetfngs have been combined because of COVID-19 and the meetfngs begin at 4:00 pm in the Council Chambers. Dates and times may be affected by holidays or other events. https:// cityoffoley.legistar.com/Calendar.aspx The City of Foley was recognized on TravelAwaits.com as “The Adorable Gulf Coast Town That Feels Like a Hallmark Christmas Movie”. Visit https:// www.travelawaits.com/2717694/foley- alabama-hallmark-christmas-movie- town/ to read the artfcle by Robin O‘Neal Smith. 5 General Financial Information Most City services and projects are accounted for in a category referred to as Governmental Funds. Governmental Funds are typically used to account for tax supported governmental actfvitfes and are divided into four categories. General Fund accounts for revenues and expenditures associated with the general operatfons of the City that are not required to be accounted for in separate funds. Capital Project Funds account for acquiring and/or constructfng facilitfes, roads, drainage systems and other major capital improvements. Special Revenue Funds account for proceeds of specific revenue sources that are restricted, committed, or assigned for specific purposes. Debt Service Funds account for the accumulatfon of resources to be used for payment of principal and interest on general long-term debt. As of September 30, 2021, the City’s Governmental Funds reflected a combined fund balance of $37,287,595, an increase of $9,149,099 from the prior year. Revenues and expenditures increased in fiscal year 2021 as a result of increased grants, sales & use taxes, Hurricane Sally, and Covid related expenses 407 East Laurel Ave. PO Box 1750 Foley, AL 36536 (251) 943 - 1545 (251) 952 - 4014 - fax www.cityoffoley.org Bid Informatfon: www.cityoffoley.org/financial services division/purchasing/bids/surplus/ bids&solicitatfons Apply for a job: https://cityoffoley.org/ human-resources/ Facebook: @cityoffoleymunicipal @visitioley 6 Fund Balance A key measure of the City’s overall financial health is Fund balance. Fund balance is the difference between assets and liabilitfes. For fiscal year ended September 30, 2021, the City’s fund balance for all Governmental Funds totaled approximately $37.2 million. The Balance Sheet presents informatfon about the assets, liabilitfes and fund balance. Assets are what the City has, owns or amounts owed to the City. Liabilitfes are what the City owes or any debt they are legally required to pay. A positfve fund balance reflects the solvency or health of the City’s finances. Fiscal year 2021 fund balance increased as a result of increased operatfonal grants and reimbursements from FEMA for Hurricane Sally recovery; and increases in sales and use taxes that occurred during the year. The City’s fund balance is broken into five categories: nonspendable, restricted, committed, assigned, and unassigned. Nonspendable funds represent items such as inventories and prepaid items. Restricted funds can only be used for specific purposes because of City Code, state or federal law, or conditfons by grantors or creditors. Committed funds can only be used for specific purposes determined by an ordinance of the City Council. Assigned funds can only be used for purposes constrained by City Council. Unassigned fund balance represents the residual amount of the balances that do not fall in any of the categories above. Assets 9/30/2021 Cash & Investments $ 26,795,549 Receivables 17,371,971 Inventories & Prepaid Items 278,598 Total Assets $ 44,446,118 Liabilitfes Accounts Payable $ 6,604,655 Unearned Revenues 553,868 Total Liabilitfes $ 7,158,523 Total Fund Balance $ 37,287,595 Did you know??? The City distributed 650 free trees on February 27, 2021, at the Annual 40th Arbor Day event as part of the #FoleyReLeaf campaign to replace the canopy lost during Hurricane Sally in 2020. The 41st Arbor Day celebratfon is scheduled on February 26, 2022, at 1:00 PM at Coastal Alabama Farmers & Fisherman's Market. Trees to be distributed are Nuttall Oak, Willow Oak, Live Oak, Sawtooth Oak, Bald Cypress, and Japanese Cedar. 7 The City uses money from taxes (property, sales, lodging, etc.) and fees (licenses, permits, etc.) to pay for governmental actfvitfes. Certain governmental actfvitfes (sanitatfon, recreatfonal actfvitfes, etc.) require a fee or charge for the service. The majority of money comes from sales & local taxes, utflity tax equivalents, and licenses & permits. In 2021, the total revenue for Governmental Funds was $77,552,185 an increase of $23,860,018 from 2020. Sales and local taxes are the City’s primary sources of unrestricted revenue. Fiscal year 2021 sales and local taxes increased by approximately $9.1 million or 31%. Intergovernmental revenues increased by approximately $11 million as a result of FEMA reimbursements and COVID-19 grants. Where the Money Comes From 8 The City of Foley provides a multftude of services for residents, businesses and visitors through its public safety, culture & recreatfon, sanitatfon, economic development, and highways & streets functfons of government. In 2021, the largest parts of the expenses were used for general government and public safety. General Government expenses increased as a result of Hurricane Sally clean up and costs associated with the COVID-19 pandemic. Debt service expenditures increased as a result of two bond refundings during the year and several bonds and notes paid off during the year. The total expenditures were $66,187,358, an increase of $16,064,400 from 2020. The $8 million spent for capital outlay included substantfal investment for police and street department equipment, completfon of airport improvements, the purchase of land and the completfon of various road and recreatfon projects. Where the Money Goes Did you know? The Foley Library offers free wifi and free use of the computer lab. If you have a library card, there are hot spot devices available to check out for 2 weeks for internet access at home. See the Public Library’s website for all the services offered. https:// www.foleylibrary.org/ Foley’s Railroad Museum & Model Train Exhibit was featured in show 804 of Simply Southern TV as a fun way to learn about locomotfves for kids and kids at heart. The episode is available on: https://simplysoutherntv.net/2022/01/22/ show-804 More informatfon on the Foley Railroad Museum & Model Train Exhibit is available at: http://foleyrailroadmuseum.com/ 9 Understanding the City’s Debt & Bond Rating The following is a summary of the City’s outstanding debt as of September 30, 2021. There was a total net reductfon in debt of $506,411. The City currently maintains a Standard and Poor's ratfng of AA- and a Moody's Investors ratfng of Aa3. Ratfng agencies evaluate the economic well-being of an area from informatfon such as the median income, how dependent the community is on certain employers or industries, the diversity of the tax base, the rate of populatfon growth, stability of revenue, and outstanding debt. It is the goal of management to raise the City’s ratfng by forecastfng multfple year revenue and expense, and paying down debt. Higher ratfngs allow the City to issue debt with lower interest rates, which reduces the total interest paid on bond issues. Moody's S&P RATING CATEGORIES SECURE RANGE: Aaa AAA PRIME: Superior financial security. Highest safety. Aa1 AA+ HIGH GRADE: Aa2 AA Excellent financial security. Highly safe. Aa3 AA- A1 A+ UPPER MEDIAN GRADE: A2 A Good financial security. More susceptfble to economic changes than highly rated compa- nies. A3 A- Baa1 BBB+ LOWER MEDIAN GRADE: Baa2 BBB Adequate financial security. More vulnerable to economic changes than highly rated compa- nies. Baa3 BBB- VULNERABLE RANGE: Ba1 BB+ NON INVESTMENT GRADE: Ba2 BB Speculatfve. Capacity to meet long-term poli- cies is vulnerable. Ba3 BB- B1 B+ HIGHLY SPECULATIVE: B2 B Vulnerable financial security. B3 B- Any rating below a "B" rating is extremely vulnerable and possibly in default status with little prospect for recovery and questionable ability to meet obligations. 2021 Total Outstanding Debt General Obligatfon Bonds $ 40,753,913 69.24% Installment Purchases 2,203,742 3.74% Special Revenue Bonds 15,902,407 27.02% Total Outstanding Debt $ 58,860,062 Project Name Capital Purchases 9th Avenue Sidewalks (TAP grant) Fire Refurbished Rescue Truck Airport T-Hangar Rebuild (Sally) Jail Correctfons RNS Control Board County Rd 12 & James Rd Turn Lane Police Vehicles (12) First Responder Safe Room (HMPG grant) Sports Tourism Reel Mower Highway 59 & County Rd 12 Improvements (ATRIP grant) Streets Back Hoe Highway 98 Multfpurpose Sports Fields Streets Bucket Truck Juniper St Extension Streets Department Flatbed/Dump (2) New Library Various Departments/Funds Vehicles (11) Mel Roberts Bathroom Building Sanitatfon Fund 40 Yard Loader Public Works Campus (New) Sanitatfon Fund Dumpster Hauler Repave & Widen Foley Beach Express Sanitatfon Fund Knuckle Boom Loader Drainage Improvements (various) Sanitatfon Fund Recycle Truck The City maintains a 10 year capital purchase and capital improvement plan which can be viewed on the City’s website in the fiscal year 2022 budget. Below is a list of some of the larger projects and purchases that are currently underway or planned to begin during fiscal year 2022. Major Capital Projects & Purchases 10 34,653 Calls for Police Service 2,465 Calls for Fire Emergency Service 37 Miles of Sidewalk Maintained 142,176 Library Patron Visits 970,875 Total Items Circulated 7 Youth Sports Programs Offered 9,666 Park Train Rides 5,049 Senior Program Partfcipants Nature Park 8-Explore & Observe Programs 38-Field Trips, Camps & Workshops 23-Events Booked 99-Rentals During the year, the City completed the first road constructed by the new in house road constructfon crew. This road was named Koniar Way in honor of the City’s previous Mayor, John Koniar. 149,660 Sports tourism Visitors to Foley Graduatfon Rate—85 % School Enrollment—3,692 9,886 Tons of Household Garbage Taken / 394 Tons Material Recycled 671 Environmental Permits Issued / 622 Permit Inspectfons 2,896 Street Lights City- Wide 161 Miles of Streets Maintained 920 Tree City Program—Trees Planted Statistics & Operating Indicators 2,740 Business License Issued 5,291 Building Permits Issued Website Hits: City of Foley—309,772 Visit Foley—170,886