Popular Annual Financial Report (PAFR)

Popular Annual Financial Report

For Year Ending June 30, 2020


Photo: Dread Xeppelin Aerial/JJ Adams

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TABLE OF CONTENTS 4 Report Overview

A Message from the City Manager

6 City Demographics

City Council Members

8 City Council Priorities

Credit Ratings & Awards

10-12 General Fund

Enterprise Funds

14-15 Tourism Funds

Debt Reporting

17-19 Enhancements & Public Safety

Affordable Housing

21 Transit

22 Unity Park

23 Cleveland Park Stables & Zoo Projects

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REPORT OVERVIEW This Popular Annual Financial Report (PAFR) is designed to provide citizens and other interested parties with a

user-friendly overview of the City’s fnancial results and increase awareness of the audited fnancial statements in the City’s FY2019-20 Comprehensive Annual Financial Report (CAFR), or formal annual report. The FY2019-20

CAFR was audited by Greene Finney, LLP and has received an unmodifed or “clean” audit opinion. The City submits the CAFR to the Government Finance Offcers Association of the United States and Canada annually

and has received the Certifcate of Achievement for Excellence in Financial Reporting for 32 years.

The PAFR is not required to present the same level of detail as the CAFR and, therefore, may not fully conform to generally accepted accounting principles. Rather, in a summarized version, this report highlights the overall fnancial condition and trends of the City. The debt of the City of Greenville Public Facilities Corporation (PFC),

a blended component unit of the City established for the beneft of the City, is also included with the City’s other obligations. An electronic version of this report is available on the City’s website at

https://www.greenvillesc.gov/401/Financial-Publications.

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https://www.greenvillesc.gov/401/Financial-Publications


A MESSAGE FROM THE CITY MANAGER

The City of Greenville is proud to present its frst Popular Annual Financial Report (PAFR) for the fscal year ending June 30, 2020. This document is based on the City’s FY2019-20 audited fnancial statements and refects our commitment to fscal responsibility, quality growth and

environmental sustainability.

Before the coronavirus pandemic, the City was approaching the end of the fscal year fnancially strong. Property tax collections from commercial and residential properties had increased $2.4 million from the prior year. Licenses and permits were showing strong growth. Parking operations revenue, a good

indicator of retail and institutional activity, was headed to record highs without any tax increases.

Our strong fnancial position gave momentum to major projects and initiatives. Phase I construction began on Unity Park, the City’s largest and most ambitious development of outdoor space to date. The Parallel Parkway, an essential alternative to a highly congested retail corridor, was completed.

The City’s stable fnancial position, plus years of prudent fnancial planning and conservative projections will enable us to weather the pandemic, effectively respond to community needs and

invest in the future. Staff will focus energy toward the City’s adopted FY2020-21 work plan, advancing public safety, economic development and customer service.

Though challenges persist, I am confdent that City Council’s leadership, the dedication of City staff and the steadfast support of our public and private partners will position Greenville for success.

John McDonough City Manager

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CITY DEMOGRAPHICS Population

Daytime Population Increase

2024 Population Prediction

63.5% White

29.1% Black

0.3% American Indian

1.9% Asian

0.1% Pacifc Islander

2.9% Other

2.2% Two or More Races

6.8% Hispanic

High School Diploma or Equivalent

Bachelor’s Degree

Associate Degree

Graduate or Professional Degree

18.5%

8.2%

27.9%

19.3%

Housing Residents

2019 Owner vs Renter Occupied Housing

*11.6% of housing units were vacant

Median Household Income

Median Age

2019 2024 $50,609 $58,487

Median Home Value

2019 2024 $288,070 $320,184

Per Capita Income

$36,614

2019

$42,202

2024

36.9

2019

37.9

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U.S. Census Bureau, Census 2010; Esri forecasts for 2019 and 2024

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CITY COUNCIL MEMBERS

Knox White Mayor

John DeWorken District 1

Lillian B. Flemming District 2

Ken Gibson District 3

Wil Brasington District 4

Dorothy Dowe At Large

Russell Stall At Large

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CITY COUNCIL’S FY2019-20 PRIORITIES

At their annual retreat in February 2019, City Council established six focus areas to prioritize funding in the FY2019-20 budget:

1. Infrastructure - building and maintaining the systems that allow the City to function optimally.

2. Neighborhoods - protecting character and quality of life by strategic investments.

3. Public Safety - providing the resources necessary to keep the city safe.

4. Affordable Housing - ensuring that housing options exist for people of all backgrounds.

5. Economic Development - attracting, creating and retaining jobs and businesses.

6. Transportation - improving roads, transit and bicycle/pedestrian options.

Examples of ways the FY2019-20 budget supported City Council’s funding priorities:

• $1.0 million for affordable housing initiatives • $1.2 million in operating assistance for GTA • $3.7 million for parks, greenways, trails and recreation • $3.9 million for police and fre initiatives, including transition to the statewide emergency communications system • $4.0 million for parking facility rehabilitation and new parking control technology • $4.7 million for street, sidewalk and intersection safety improvements • $5.3 million for facilities and projects to support or expand economic activity • $9.4 million for stormwater and wastewater system rehabilitation

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The City of Greenville is the only municipality in South Carolina to hold the coveted AAA rating - the highest possible rating - from all three of the nationally recognized credit rating organizations:

Moody’s Investors Service: Aaa

Standard and Poor’s: AAA

Fitch Ratings: AAA

Comparable to credit scores for individuals, the higher the bond rating, the better the interest rates the City can access to fund major capital infrastructure projects and support public-private

partnerships. The rating is a report card on how well the City is managing its debt to achieve its strategic long-term goals. These ratings indicate the City is fnancially strong, prudent

with its debt management and well-positioned to pay a bond’s principal and interest on time.

CREDIT RATINGS & AWARDS

Southern Living South’s Best Farmers’ Markets

“They’re the next best thing to growing The South’s Most ‘Tasteful’ your own fruits and veggies.” Small Towns

“Greenville has fast become one of the most delicious destinations on the East Coast...”

Condé Nast Traveler Readers’ Choice Awards: Best Small Cities in the U.S. 2019

“With a dynamic mix of urban center paired with abundant natural resources, walk off your food coma in 32-acre Falls

Park, which runs through the middle of town...”

Best Places to Live 2019 “The tree-lined Main Street is picture-perfect with

a footbridge crossing the river. It’s a landscape that launched a thousand Instagram photos.”

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GENERAL FUND

The General Fund accounts for revenues and expenditures to carry out basic governmental functions such as police and fre protection, recreation, infrastructure improvements and administrative services.

Property taxes are the City’s largest revenue source, comprising 45% of all General Fund revenues. The tax levy is determined by market value, assessment ratio and millage rate. The property tax revenue estimate for FY2019-20 was $42 million, an 8% increase over the previous year with a total collected of $44.9 million.

Market value is determined by the Greenville County Assessor’s Ofce factoring in size, condition, location and sale price of comparable properties.

Assessment ratio is the appraised market value multiplied by 4% for owner-occupied residences, 6% for commercial properties and motor vehicles, 10% for personal property and 10.5% for industrial and utilities.

Licenses and permits represent the second-largest revenue source for the City. Business licenses are among the most signifcant and the most economically sensitive revenues. Year-to-date collections indicate this revenue source is growing.

Where Did the General Fund Money Come From? How Was the General Fund Money Spent?

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Governmental Activities Net Position 2020 2019 Change Balance Sheet

Assets $ 366,727,719 322,754,665 $ 43,973,054 Deferred Outflows of Resources 17,815,643 15,494,123 2,321,520 Liabilities (208,511,768) (174,786,346) (33,725,422) Deferred Inflows of Resources (2,224,557) (3,353,966) 1,129,409 Net Position $ 173,807,037 160,108,476 $ 13,698,561

Business-Type Activities 2020 2019 Change

Assets $ 199,068,019 199,815,947 $ (747,928) Deferred Outflows of Resources 2,311,497 2,020,322 291,175 Liabilities (39,929,438) (43,341,289) 3,411,851 Deferred Inflows of Resources (217,856) (289,394) 71,538 Net Position $ 161,232,222 158,205,586 $ 3,026,636

A balance sheet provides a snapshot of what the City currently owns (assets) and owes (liabilities), as well as sources (deferred infows) and uses (deferred outfows) that will be recognized in another year. Net position represents the City’s investment in the assets it uses to provide services to its citizens.

Increases or decreases in net position may serve as a useful indicator of whether the City’s fnancial position is improving or declining. The City’s net position for governmental and business-type activities increased by 5% or $16.7 million during FY2019-20.

General Fund - Fund Balance Trend

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Changes in Net Position Income Statement

An income statement provides a summary of amounts received (revenues) and amounts spent (expenses). The diference between revenues and expenses shows the City’s change in net position. A positive change in net position indicates the City had enough revenue to cover its obligations and the ability to save for the future.

The year over year increase in net position of the City refects the positive variance of revenues over expenses. There was an overall 4% decrease in revenues and a neutral change in expenses from the prior year, refecting a total change in net position of $16.7 million.

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ENTERPRISE FUNDS

An enterprise fund is operated like a private business, where a fee is charged for goods or services. Annual budgets are established for enterprise funds. As a result of COVID-19, the Greenville Convention Center, Parking and the Greenville Zoo experienced severe negative fnancial impacts from a reduction in visitors.

The Greenville Convention Center is one of the largest conference centers in the Southeast. The facility includes 280,000 square feet of exhibit space and 60,000 square feet of meeting space. In addition to the annual operating subsidy, this fund paid $550,000 for improvements, furnishings, fxtures and equipment.

The Stormwater Management program controls the fow of surface water through basin master planning, remedial repairs and maintenance of open ditches and piped drainage in City rights-of-way and easements. The budget included $5 million for stream restoration and stabilization in Unity Park.

Enterprise Fund Revenues vs Expenses

The Parking fund accounts for the operation of the City’s parking system, which includes 12 parking garages, totaling 7,636 spaces, and three parking lots comprising another 360 spaces. In addition to new gate control equip-ment for the garages, this fund also paid $1.25 million for garage rehabilitation needs in FY2019-20.

The 14-acre Greenville Zoo is home to more than 275 animals and welcomes more than 300,000 guests each year. The Association of Zoos and Aquariums (AZA) has accredited the zoo for over 25 years. This fund paid a one-time cost of $125,000 for a new point-of-sale system for the zoo.

Wastewater operations, including the maintenance of 327 miles of wastewater lines, are fnanced by a wastewater charge that is based on meter size. Expenses included $2.8 million for a sewer basin rehabilitation project.

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TOURISM FUNDS Hospitality Tax The City of Greenville has a 2% hospitality tax on prepared meals and beverages. The proceeds help fund tourism-related activities and facilities as allowed under state law. The hospitality tax fund was signifcantly impacted by COVID-19, and capital project spending reductions were made during FY2019-20 to keep the fund balanced. Hospitality tax funds are used to provide operating subsidies for the Greenville Zoo and Greenville Convention Center, ofset the cost of enhanced police protection and park maintenance in the Central Business District and invest in signature sites like Falls Park and Unity Park.

Local Accommodations Tax

State Accommodations Tax Accommodations within the state of South Carolina are subject to a 2% tax. These monies are collected by the State and distributed to counties and municipalities. Per state law, the proceeds are distributed between the City’s General Fund, tourism advertising and promotion and other tourism-related expenditures. FY2019-20 revenues from this source were $2.4 million, which is 15.3% lower than FY2018-19.

The City of Greenville has a 3% local accommodations tax. The proceeds are used primarily as payment for debt incurred by the Greenville Arena District for the construction of the Bon Secours Wellness Area, as well as defraying the cost of tourism marketing services provided by VisitGreenvilleSC. Capital projects supported by this fund have included Arts in Public Places, Fluor Field stadium improvements and Greenville Convention Center conference room updates.

Other Tourism Funds The City also receives Sunday alcohol permit funds and admission taxes from tourism related sources.

Where Did the Tourism Funds Come From? How Were the Tourism Funds Spent?

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Tourism funds were signifcantly impacted by the COVID-19 pandemic; however, prudent planning will allow the City to effectively respond to community needs.

Selected Tourism Funds - Gross Revenues

Selected Tourism Funds - Fund Balance

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Outstanding Debt By Type DEBT REPORTING The City maintains an active debt management program to achieve long-term goals, reinvest in capital infrastructure and promote public-private partnerships. The City’s use of long-term debt and pay-as-you-go fnancing allows the City to have a fexible Capital Improvement Program while protecting its long-term fnancial position.

Debt Issuance

The City’s only debt issuance in FY2019-20 was $35.8 million in Hospitality Tax Revenue Bonds in support of the Unity Park project. The bonds were issued for a 20-year term at an incredibly low interest rate of 1.71%.

Planned debt issuance for FY2020-21 includes a $3 million Stormwater Revenue Bond for the Unity Park river restoration, a $4.5 million Sewer Revenue Bond and a $1.7 million capital lease for fre apparatus.

Total Debt Service By Year

*The Installment Purchase debt relates to the City of Greenville Public Facilities Corporation. For more information, see the City’s fnancial statements.

FY 2024-2025 FY 2019-2020 FY 2020-2021 FY 2021-2022 FY 2022-2023 FY 2023-2024

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ENHANCEMENTS & PUBLIC SAFETY PARALLEL PARKWAY City Council Priorities: Infrastructure, Transportation

Project Cost: $3.8 million

Drivers no longer have to endure trafc congestion when trying to reach their favorite shopping, dining and entertainment destinations. In September 2019, the City opened Parallel Parkway to connect two high trafc roadways. The parkway features three roundabouts to keep trafc fowing, a 10-foot-wide multi-use path and streetlights for increased visibility.

PARKING CONTROL EQUIPMENT City Council Priority: Infrastructure


The City began installation of new parking garage equipment, including the addition of license plate recognition cameras. The system allows drivers with registered tags to enter and exit the garage without an access card, reducing entry and exit times and providing more accurate customer counts.

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VERDAE BOULEVARD STREETSCAPE PROJECT

City Council Priorities: Infrastructure, Transportation


Located in an area of exploding growth, Verdae Boulevard connects two major commercial corridors and averages 12,200

vehicles a day. To increase mobility options for residents, the City constructed a 10-foot-wide multi-use path and installed new curb

and gutter, landscaping and lighting.

NEW AUGUSTA ROAD FIRE STATION City Council Priority: Public Safety


A new state-of-the-art fre station has replaced the 70-year-old station on Augusta Road. Construction began in 2016 as part of a years-long efort to improve the City’s aging fre stations and response times. The new station can house up to eight frefghters and features two drive-through bays designed to meet current and future apparatus needs. An emergency power generation system guarantees station readiness at all times.

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FIRE DEPARTMENT TRAINING FACILITY

City Council Priority: Public Safety

Project Cost: $475,000

All Fire Department training is conducted at a City facility originally built in 1972. Improvements include the construction of a new burn building, new restroom facilities and a new classroom.

BODY-WORN CAMERAS City Council Priority: Public Safety

Project Cost: Ongoing, $1.4 million to date

Patrol ofcers use body-worn cameras to build community trust through accountability and obtain accurate documentation to support prosecution and internal conduct investigations. There is an annual lease cost for the equipment and software.

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AFFORDABLE HOUSING

City Council Priority: Afordable Housing

Project Cost: Ongoing commitment of $6.5 million over 5 years

In FY2019-20, the City directed $1 million to support afordable and workforce housing developments in partnership with the Greenville Housing Fund. This is in addition to the $3.5 million previously appropriated in FY2016-17 and FY2018-19. These investments, along with future planned contributions, will continue to be critical to reducing the City’s afordable housing defcit.

In January 2020, the City and community partners dedicated Joshua’s Way, a pocket neighborhood with seven rental duplexes for seniors and six single-family homes, in the Sterling community. In addition to investing $130,000 in site and infrastructure improvements, including sewer, a paved road and sidewalks, the City also directed more than $200,000 of its federal funding to the project.

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TRANSIT

GREENLINK City Council Priority: Transportation


In addition to providing operating assistance to Greenville Transit Authority (GTA), the City of Greenville serves as the day-to-day operator of the Greenlink transit system. Transit operations, which include fxed route buses, paratransit service and downtown trolley service, are recorded in the Transit Special Revenue Fund.

In FY2019-20, the City provided $1.2 million - a milestone - in operating assistance for GTA, which helped fund expanded trolley service during a portion of the year. Funding was also allocated to help implement recommendations from Greenlink’s 2020-2024 Transit Development Plan, including extended service hours.

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Popular Annual Financial Report22

City Council Priorities: Neighborhoods, Affordable Housing, Economic Development

Estimated Project Cost: $60 million

Unity Park construction began in 2019 and will take three years to complete. The 60-acre park located near three historically significant neighborhoods, Southernside, West Greenville and Hampton-Pinckney, will include playgrounds, open green space, a pedestrian bridge over the Reedy River and a gathering hall. The City donated nearly nine acres of property adjacent to the park for use in developing affordable and workforce housing.

UNITY PARK


GREENLINK

CLEVELAND PARK STABLES

City Council Priority: Neighborhoods

Project Cost: $546,000

The extension of Cleveland Park was made possible by a local philanthropist, who donated the stables property.

The City consolidated the donated property with 2.5 acres of adjacent, undeveloped land and transformed it into a passive recreation space featuring an open lawn,

walking path, native plant installations and a rain garden.

ZOO PROJECTS City Council Priority: Infrastructure


Veterinary Hospital Renovation ($960,000): This project provided additional quarantine space and specialty areas such as a surgical suite, lab, instrument prep, pharmacy and expanded treatment space.

Lion’s Den ($482,000): Chuma and Saied, the zoo’s two male African lions, now have more room to roam, a ledge for resting when they’re not on exhibit and a temperature-controlled den space comprised of three bedrooms.

Primate Row ($801,000): The zoo’s spider monkeys, guenons, lemurs and colobus monkeys have a new 11,000-square-foot primate den that allows them to interact indoors or outdoors. Zoo visitors can observe from a new public viewing area.

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Popular Annual Financial Report24

https://www.greenvillesc.gov

Popular Annual Financial Report (PAFR)

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