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HomeMy WebLinkAboutCounty of Bernalillo - Public Financial Report 1 2 About This PAFR Table of Contents Elected Officials ………………………………..….….......4-5 County Government ……..………………………..…..…...6 Local Economy……….......................................................7 Community News……………………………...……….….8-9 Statement of Net Positions……………………….….……10 Capital Assets …….…………………………………….. ...11 County Debt …………………………………………..….....12 Property Taxes …………………………...………………...13 Revenues ……………………………………………...….…14 Expenses ………………………………………………...….15 This report is largely based on the county’s 2021 Annual Comprehensive Financial Report (ACFR); however, this report is not prepared in accordance with generally accepted accounting principles (GAAP). Only the financial data for the general gov-ernment is included in this report and, therefore, the county’s business-type activities are excluded. Additionally, information is presented in a summa-rized manner and certain financial statements and note disclosures required by GAAP are omitted. A copy of the county’s audited 2021 ACFR, which is prepared in accordance with GAAP, is located at: www.bernco.gov/finance/comprehensive-annual- financial-reports-cafr.aspx The Government Finance Officers Association (GFOA) of the United States and Canada has given an award for Outstanding Achievement in Popular Annual Financial Reporting to Bernalillo County for its Popular Annual Finan- cial Report for the fiscal year ended June 30, 2020. This is a prestigious national award recognizing conformance with the highest standards for preparation of state and local government popular reports. In order to receive an award for Outstanding Achievement in Popular Annual Financial Reporting, a government unit must publish a Popular Annual Financial Report, whose contents conform to program standards of creativity, presentation, under- standability and reader appeal. An award for Outstanding Achievement in Popular Annual Financial Reporting is valid for a period of one year only. This was Bernalillo County’s sixth award. We believe our current report contin- ues to conform to the Popular Annual Financial Reporting requirements and we are submitting it the GFOA. Publication The 2021 Popular Annual Financial Report is published by the Bernalillo County Ac- counting and Budget Department Account- ing Section Photo Credits Front Cover - Open Space; Carlito Springs Community Services Division Bernalillo County Other Photos - Bernalillo County Public Art Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 2 3 Dear Residents: We are pleased to present the Bernalillo County Popular Annual Financial Report (PAFR) for the fiscal year 2021 (FY21). Our goal in producing this report is to communicate the county’s financial operations in a straightforward and easy to read format so that you can obtain a better understanding of Bernalillo County government. In addition to providing information on county finances and government operations, this report demonstrates what makes Bernalillo County a great place to live, study and work. Bernalillo County’s econo- my is supported by a vast network of businesses and not-for-profits. It is also important for us to demonstrate the role county government is playing in supporting our community. The PAFR is designed to provide residents with an overview of the county’s revenues, expenditures and oth- er general information. Though the PAFR is not audited, its financial content is derived from the county’s au- dited Annual Comprehensive Financial report (ACFR). The ACFR for this fiscal year was audited by Clif-tonLarsonAllen LLP and received an unmodified (clean) opinion. Bernalillo County has received the Certificate of Achievement for Excellence in Financial Reporting by the Government Finance Officers Association on our CAFR for 15 consecutive years, and received the Award for Outstanding Achievement on our PAFR seven times. This report is for your use in understanding the operations of the county and is not intended to replace the ACFR. For anyone that requires more in-depth information, the ACFR provides detailed financial information, disclosure notes, supplemental schedules and statistical tables. The ACFR can be viewed at the County Man- ager’s Office at 415 Silver NW, or it can be found online at the county’s website: www.bernco.gov/finance/ comprehensive-annual-financial-reports-cafr.aspx. In FY21 the Bernalillo County Emergency Operations Center continued it’s response to the COVID-19 pan- demic to ensure the safety of citizens and county personnel, manage a coordinated response effort, minimize business interruption, and to keep the public and county personnel safe. The county was a primary recipient of the CARES Recovery Fund, receiving $31.8 million. This fund recognized $4.7 million in FY20 and $26.9 million in FY21. The fund was used to account for monies received through the CARES Act, which provides for payments to state, local, and tribal governments navigating the impact of the COVID-19 outbreak. The plan took time to implement with the majority of the expenses falling in FY21. The most notable expense was for economic stimulus with $9.4 million going to small businesses, behavioral health grants, and housing sup- port grants. The county also spent $8.2 million in public safety and public health payroll, $6.7 in public health expenses and medical expenses, $3.2 million in teleworking and security expenses, $2.9 million in payroll substantially devoted for a different use, and $1.2 million to upgrade facilities for pandemic safe practices. In FY21 the county was also a primary recipient of $66.0 million in federal recovery funds, American Rescue Plan Act (ARPA), to combat the COVID-19 pandemic, including public health and economic impacts. This rep- resented the half of the $131.9 million direct allocation to Bernalillo County; the second half is expected to be received in May 2022. The ARPA spending plan was approved by the Board of County Commissioners at the Sept. 28, 2021 administrative meeting. Expenditures will begin in FY22. Letter from the County Manager Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 3 4 Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 4 iDebbie O’Malley - District 1 Commissioner Debbie O’Malley's district includes much of the North Val- ley, Downtown, the Westside, To’Hajiilee and part of Laguna Pueblo. Vice Chair Steven Michael Quezada - District 2 Commissioner Steven Michael Quezada district includes the southernmost part of the county, from interstate 25 west to the county line and east along Kirtland Airforce Base and the Isleta Pueblo. Adriann Barboa - District 3 Commissioner Adriann Barboa district includes a portion of Kirtland Air force Base, Albuquerque International Airport, and Downtown. Walt Benson- District 4 Commissioner Walt Benson’s district encompasses the northern portion of Bernalillo county, from Sandia heights and north Albuquerque acres to par- adise hills, Ventana ranch and portions of the North Valley. Chair Charlene Pyskoty - District 5 Commissioner Charlene Pyskoty’s district includes the majority of the East Mountain area, east of Santa Fe county line, and Isleta Pueblo/Sandia La- boratory. Elected Officials 5 Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 5 Julie Morgas Baca County Manager ______________________________ Tanya R. Giddings Assessor Linda Stover County Clerk Cristy J. Carbón-Gaul Probate Judge Manuel Gonzales III Sheriff Nancy M. Bearce Treasurer 6 The division of counties in New Mexico can be traced back to the time of Mexican rule. The first subdivision of the New Mexico Territory was made in 1837 when two "partidos", or districts, were created. In 1844, New Mexico was re-divided into three districts. Eventually, these districts were further subdivided into areas that in- cluded boundaries similar to today's counties. One inter- esting note is that the first Bernalillo County boundaries were much larger than today's divisions. When New Mexico entered the union in 1912, the New Mexico Constitution vested the law-making power of the state in the legislature. Bernalillo County derives its au- thority from the state constitution. Counties are subject to the will of the legislature, modified only by the state consti- tution, the courts and the legislative process. The county has a commission-manager form of government in which most of the day-to-day administrative duties are delegated to the coun- ty manager. All legislative power within the county is vest- ed in a five-member board of commissioners, each of whom is elected to four-year terms from single member districts, with a two-term limit. The executive functions are divided; the powers are shared by the board and five elected county officials: the assessor, county clerk, pro- bate judge, sheriff and treasurer. The county provides ser- vices to its residents and businesses in the following ways: Public Safety includes the protection of life and property. The Sheriff's Department and Fire Department act to prevent danger, en- force laws and provide public education. The county oper- ates the Metropolitan Detention Center and the Youth Ser- vices Center. The Office of Emergency Management coor- dinates efforts in the event of natural or human caused disasters, including acts of terrorism. The Department of Behavioral Health Services provides programs, services and activities specific to DWI, substance abuse and be- havioral health issues to improve outcomes in our commu- nity. The responsibility of Animal Care Services is to pro- tect the safety, health and welfare of the public while en- forcing humane animal treatment and promoting responsi- ble pet ownership. Public Works projects provide a wide range of services to the county that include the design, construction and proper maintenance of roads and storm sewers. Public Works is also responsible for the replacement and repair of fleet vehicles for all county de- partments as well as maintenance of all buildings and fa- cilities utilized by the county. Other services provided in- clude a comprehensive solid waste management and an anti-graffiti program to enhance the health and welfare of residents and the environment. Health and Welfare is provided through the county’s financial support to a variety of social service programs. The purpose is to improve the quality of life for low and moderate income residents of the county. This is funded by a health care gross receipt tax as well as other sources. Culture and Recreation programs are admin- istered by the county’s Parks, Recreation, and Open Space Department, which is responsible for providing recreation, leisure, community services and facilities necessary to promote public wellbeing and quality of life for youth, adults and senior citizens. The department oversees projects to maintain and construct parks, trails and community centers, and also manages the public arts program. County Government Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 6 7 Local Economy Bernalillo County, with the City of Al- buquerque making up 82.5 percent of its population, serves as a hub for commerce and industry in the South- west. Bernalillo County accounts for approximately half of all economic activity in New Mexico. Its success can be attributed to a diverse eco- nomic base consisting of government, services, trade, agriculture, tourism, manufacturing, and research and de- velopment. The median household income in Ber- nalillo County is $56,115 and 328,000 people are employed. The largest industries in the county are health care & social assistance, Retail trade, and educational services. The highest paying industries are mining, quarry- ing, & oil and gas extractions, profes- sional, scientific & technical services and public administration. Film is a growing industry in New Mexico and Bernalillo County’s film business flourishes. Movie Maker Magazine ranked Albuquerque No. 5 on its list of Best Places to Live and Work as a movie maker 2016: Top 10 Big Cities. The economic impact from the film industry is significant. Since 2002, close to $1.3 billion of direct spending has come to Albuquerque as a result of the film industry’s work locally. In the past year, the direct spending to the greater Albuquerque area was over $180 million. Entrepre- neurs, artists and artisans are nur- tured in Bernalillo County and this was recognized when the county was named “20 Game-Changing Places to Live” by Sunset Magazine in 2018. From an academic perspective, some Albuquerque high schools ranked na- tionally as some of the best in the United States. In 2017, the University of New Mexico School of Law was ranked 77 nationwide by U.S. News & World Report. The Bernalillo County/Albuquerque area is teaming with business creation poten- tial. There is a major push today to capture this potential. This is evi- denced in the many configurations of incubators and start-up programs fill- ing our coffers. These boast entic- ing the savvy high tech and niche in- dustry entrepreneurs. This is good news and important work. We want to foster, retain, and attract talent to our county. It is how we prosper individu- ally and as a community. That said, there is continued energy and innova- tion among the workhorses of the business world: the mom and pop operations, the small manufacturers, the service industries and behemoths such as major institutions and large- scale corporations. All are essential to the business landscape; each is a strategic cog in the local business wheel. Bernalillo County Economic Development works daily with these companies in our business community to help them to maintain and improve their commerce so that as the new- comers settle into town, a solid, thriv- ing infrastructure is in place for their enterprise to take root sooner and with more success. Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 7 Internal Statistics– Bernalillo County 2021 2020 Full-time equivalent employees 2,768 2,657 Sheriff’s Stations 4 4 Fire Stations 12 12 911 Calls 68,870 66,222 Fire Department calls answered 20,355 19,218 Economy 2021 2020 Population 679,121 676,773 Unemployment rate 8.9% 4.7% National unemployment rate 6.9% 3.6% Median value of owner occu- pied housing units $199,300 $198,000 Median household income $53,329 $51,005 8 Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 8 Community News BERNALILLO COUNTY @ ALVARADO SQUARE TO OPEN TO THE PUBLIC 08/10/2021 The county’s new administrative headquarters, at 415 Silver Ave. SW, opened for business on Monday, Aug. 16 at 8 a.m. Grand opening fes- tivities have been postponed due to COVID-19 restrictions. Bernalillo County @ Alvarado Square is 282,000-square-feet, has eight floors, a basement and new adjoined 12,000-square- foot commission chambers that seats 200 peo- ple. The original building was formerly owned by Public Service Company of New Mexico (PNM). County Manager Julie Morgas Baca is pleased that Berna- lillo County @ Alvarado Square is finally a reality: “In 2017, the county purchased the building for $2.7 mil- lion with the goal of consolidating services to create a one-stop-shop customer service experience, while also reducing the county’s physical, environmental and financial footprint. Today, I believe we are well on the road to becoming a leaner, more efficient organization.” MOVIES IN THE PARK RETURNS FOR THE SUMMER 06/5/2021 The smell of popcorn is in the air, as Bernalillo County is warming up the old projector to resume the Movies in the Park series. The county had previously gone to drive-in style summer mov- ies during the pandemic, but has resumed normal outdoor, grass-seating Movies in the Park on Saturday, June 5. BERNCO HELPS PUT THE BITE BACK INTO NEW MEXICO 09/26/2020 Bernalillo County teamed up with BlueCross BlueShield of New Mexico and United Concordia Dental to, literally, put smiles back on the faces of county residents including three veterans and one person experiencing homelessness. There were 15 volunteer den- tists, hygienists, and community members who treated more than 25 patients, providing dental procedures, including dentures, at no charge. The days’ work provided more than $67,000 in dental treatments and left all involved showing off their new pearly whites. 9 Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 9 EXPANDING MOBILE CRISIS TEAMS WITH FIRE & RESCUE 06/29/2021 The Bernalillo County Department of Behav- ioral Health Services announces the launch of Fire Mobile Crisis Teams (FMCT). The program is a joint collaboration with the City of Albuquerque, Bernalillo County Fire De- partment, Bernalillo County Sheriff’s Depart- ment, and Albuquerque Police Department. The Fire Mobile Crisis Teams is the newest Behavioral Health Initiative (BHI) program. The program has filled a gap in the continu- um of care by ensuring that individuals expe- riencing a crisis, who do not need law en- forcement, receive rapid support to address immediate behavioral health needs. They also have improved individual outcomes, and are connected to the most appropriate level of care. TINY HOME VILLAGE CELEBRATES GRAND OPENING 02/10/2021 The Tiny Home Village is located on about 1.5 acres of land at the Albuquerque Indian Center. The gated community has 30 homes, each measuring 120 square feet. Five homes were equipped with ramps to accommodate wheel- chairs. Most homes are set up for single occupancy, but a limited number are arranged for couples. Only residents over 18 years of age are allowed in the tiny homes. The houses are designed as living/sleeping quarters but do not have run- ning water. A gathering facility is onsite for meal preparation and personal hygiene needs. The cost of the project was $4.92 million. While living in the village, residents will be offered social ser- vices along with assistance finding employment for financial independence and permanent housing. “A key in your pocket and a solid roof over your head offers the peace of mind and stability needed to move forward in life,” adds Commissioner O’Malley. 10 Statement of Net Position Assets and Liabilities The Statement of Net Position represents governmen- tal activities (excluding business type activities). This statement provides information on all of the county’s assets and liabilities, with the difference between the two reported as net position. Below are the three components of net position and the ending balances for governmental activities for the past three respective fiscal years: Net investment in capital assets This component of net position represents the amount that is unavailable for reducing debt or paying for ser- vices because it is the value of the capital assets them- selves (e.g., infrastructure, land, buildings, machinery and equipment), not liquid like cash or equivalents that could be used to pay bills. The county uses these capi- tal assets to provide services to citizens. Although the county’s net investment in capital assets is net of relat- ed debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. The balance of $477.5 million represents this portion of the county’s total net position. Restricted net position This component of net position represents the amount that is available for use only as allowed by creditors, grantors, contributors or laws and regulations of other governments, and restrictions imposed by law through constitutional provisions or enabling legislation. Re- stricted net position in the amount of $294.7 million rep- resents resources that are subject to external re- strictions on how they may be used. Governmental ac- tivities during the year increased the county’s net posi- tion by $100.9 million in fiscal year 2021. Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 10 11 Capital Assets The county’s investment in capital assets for its governmental activities as of June 30, 2021 amounts to $616.3 million (net of accumulated depreciation). This investment in capital assets includes land, buildings, improve- ments, machinery and equipment, construction in progress, and infrastructure. Major project expenditures in fiscal year 2021 include: • Bernalillo County @Alvarado Square substantially completed construction spending $24.2 million, consolidat- ing several buildings into one large complex, providing space for more than 800 employees. • The Cares Campus spent $5.1 million for renovations. Providing additional space for detoxification program, increased health and safety measures, a centralized nursing/staff station, anti-ligature fixtures, and new beds for clients. • County fleet vehicles replacements and additions totaled to $4.7 million. • Tiny Home Village was completed spending $1.8 million providing 30 stand alone 120 square feet living units, along with a communal village house. • Design was completed and groundbreaking started for Route 66 Westside Visitor Center, spending $2.7 mil- lion. This facility includes a commercial kitchen and restaurant with a meeting/classroom space, display areas of public art, museum space, information kiosk and retail space. Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 11 12 County Debt Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 12 The Bernalillo County Finance Division has analyzed the existing debt position of the county and has as- sessed the impact of future financing requirements on the county’s ability to service additional debt. Review and analysis of the county’s debt position is performed to provide a capital-financing plan for infrastructure and other improvements. Long-term financing projections are linked with economic, demographic and finan- cial resources expected to be available to repay the debt. Decisions regarding the use of debt are based up- on a number of factors including, but not limited to, the long-term needs of the county and the amount of re- sources available to repay the debt. The debt policy is not expected to anticipate every future contingency in the county’s capital program or future operational needs. Sufficient flexibility is required to enable county management to respond to unforeseen circumstances or new opportunities, when appropriate. On June 30, 2021 the county’s outstanding debt totaled $241 million, excluding compensated absences, pre- miums, discounts and other liabilities. General obligation bonds are direct obligations of the county for which its full faith and credit are pledged and are repaid from taxes levied on property located within the county. The county issues general obligation bonds to provide funds for the acquisition and construction of major capital facilities, as well as the purchase of library books. The balance of $131.6 million represents 55 percent of the county’s outstanding debt. Gross receipts tax revenue bonds are limited obligations of the county, repaid solely from gross receipts tax revenues. These bonds are used for the acquisition and construction of major capital projects. The balance of $109.5 million represents 45 percent of the county’s outstanding debt. The credit ratings listed below are based on the county’s ample revenue-raising flexibility, solid expenditure flexibility, low liability burden, and strong financial resilience through economic downturns. Expenditure flexi- bility is aided by prudent budgeting, annual pay-go capital outlays, and moderate carrying cost for debt ser- vice and retiree benefits. The county’s overall debt and net pension liability burden is low relative to personal income. Credit Ratings For Bernalillo County Rating Services General Obligation Bonds Revenue Bonds Moody’s Aaa Aa2 Standard & Poor’s AAA AAA Fitch AAA AA+ 13 Property Taxes The county is responsible for assessing, collecting and distributing property taxes for various governmental entities located in Bernalillo County, including itself. The New Mexico Department of Finance and Administra- tion (DFA) sets the tax rates each year by Sept. 1. The County Commission subsequently certifies the tax rates and a written order imposing the tax rates is then delivered to the county assessor. The tax year begins on Nov. 1 and ends on Oct. 31. Bernalillo County property tax revenue increased $4.9 million from $138.3 million in fiscal year 2020 to $143.2 million in fiscal year 2021, a 3.5 percent increase. The increase was attributed to an increase in the net taxable value of property located in Bernalillo County. As- sessed taxable valuation increased in the county, from $17.2 billion in fiscal year 2020 to $17.7 billion in fiscal year 2021. There was also an increase in the residential tax rate, from $7.105 to $7.114 per $1,000 of as- sessed taxable value. The Bernalillo County Commission did not approve a tax rate increase; the tax rate in- crease is due to New Mexico legislation imposing a yield control formula for the tax rate, when applied against reassessed property. Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 13 14 Statement of Activities Revenues Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 14 The Statement of Activities represents governmental activities (excluding business type activities). The state-ment provides a general understanding of how available resources are used to provide services. These sources of funds are categorized into two forms of revenue: program revenues are derived directly from county programs or from outside the county, and general revenues are primarily raised through property tax- es, gross receipt taxes and other revenues not reported as program revenues. Once the county collects tax- es and other revenues, the monies must be spent efficiently to provide services to the citizens and business- es of the county. As of June 30, 2021, the county’s revenues totaled $541.6 million, an increase of $57.6 million from the pre- vious year. The increase was primarily attributed to an increase in governmental activities revenues in gross receipts taxes, which increased $17.5 million, from $224.7. million in FY 20 to $247.1 million in FY21. Proper- ty taxes increased $6.3 million, from $163.3 million in FY20 to $169.6 in FY21. Operating grants are funds provided from federal, state or other governments and private contributions used to fund operational expenditures of programs such as health and welfare, emergency management, parks, public safety and other such programs. The county received $91.2 million in grants and contributions reve-nue during fiscal year 2021. Capital grants are funds provided from state, federal or other governments and private contributions used to fund capital improvements such as roads, buildings, parks and open space. The county received $22.8 million in capital grants and contributions revenue during fiscal year 2021. Pro- gram revenues increased by $39.2 million, from $71.4 million in FY20 to $110.6 million in FY21. In FY21 the county was successful in receiving more operating and capital grants. 15 Statement of Activities Expenses Bernalillo County, New Mexico - Fiscal Year 2021 Popular Annual Financial Report 15 During the fiscal year ended June 30, 2021 (FY21), the county expended $432.1 million, a decrease of $5.8 million from the previous year. General government expenses increased by $13.3 million, from $100.4 million in FY20 to $113.7 million in FY21. The county activated emergency operations in response to the COVID-19 pandemic. As mentioned under program revenue, the Coronavirus Relief Fund monies were received in April 2020 and the county spent $4.8 million FY20 and $27.0 million in FY21 in response to the crisis. All departments had decreases in pension expense due to changes in the actuarial calculations. Public works expenses decreased by $3.7 million, from $51.5 million in FY20 to $47.8 million in FY21, a 7.2% decrease. There were less expenditures on fuel and utilities in FY21 as operations were at a partial capacity and some buildings were utilized less during the pandemic. Pension expenses decreased $2.8 million in FY21 based on actuarial calculation. This was offset by additional shared building repairs at One Civic Pla- za with City of Albuquerque in FY21. Public safety expenses decreased by $14.4 million, from $201.6 million in FY19 to $187.2 million in FY21, a 7.1% decrease. Part of the decrease was due to a large project at Metropolitan Detention Center (MDC) in FY20 to refurbish the kitchen floor. Also, in FY21 some of MDC salaries were reallocated to the Coronavirus Relief Fund due to employees efforts to manage the pandemic conditions in the congregate setting. Pension expense decreased by $26.3 million in FY21 based on the actuarial calculation. These decreases in expend- itures were offset by 2.0% increases in salaries. Health and welfare expenses increased by $2.4 million, from $51.8 million in FY20 to $54.2 million in FY21, a 4.6% increase. The county also allocated $0.8 million in additional housing vouchers for the Section 8 area, $0.6 million in indigent care, and $0.2 million in management of Tiny Home Village in FY21. Also, in FY21 the county spent more funds on medical and psychiatric mental health at MDC. 16