POPULAR ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2024
Welcome to the
Should you have any questions about this report, please feel free to contact any of the following personnel: City Manager
David Vehaun
David.Vehaun@CityofRockHill.Com
Message from the City Manager
I am proud to present the City of Rock Hill’s 2024 Popular Annual Financial Report. The PAFR is a condensed version of the 2024 Annual Comprehensive Financial Report, or ACFR, and can be found on the City’s Facebook Page and website. This easy-to-understand report does not include all funds, assets, liabilities, and component units; however, it does provide the highlights of the City’s finances over Fiscal Year 2024. For more detail, please access the full ACFR on the City’s website at www.Cityofrockhill.com/transparency.
This document strongly reflects the Strategic Plan of the City of Rock Hill; this plan is built around three core areas: Serving Our Community, Engaging Residents, and Growing Rock Hill. Serving, Engaging, and Growing also means dedication to responsible stewardship of public dollars.
To facilitate accountability and transparency, we provide financial information in several formats for our citizens. Every month, a financial report discloses budget to actual revenues and expenses. Annually, the City produces the ACFR which consists of a number of audited financial statements that provide the overall financial position of the City. The audit is required by State law and ensures that the City conforms with Generally Accepted Accounting Principles (GAAP).
Chief Financial Officer
Anne Harty
Anne.Harty@CityofRockHill.Com
This report not only covers the City's financial position, but also provides data and access to economic, demographic, and performance information that offers context for how tax dollars and other resources are utilized in our City.
I hope you find this report both helpful and informative.
Sincerely,
David B. Vehaun City Manager
Introduction
The City of Rock Hill was founded in 1852 and incorporated in 1892 and is located in the eastern central area of York County, South Carolina, 25 miles south of Charlotte, North Carolina, and encompasses approximately 45 square miles. The City provides a full range of services, including police and fire protection; the construction and maintenance of streets and other infrastructure; parks; leisure/cultural activities and events; sanitation services; water, sewer, electric and storm water services.
City Structure
MAYOR
John P. Gettys, Jr.
City COUNCIL
Derrick Lindsay
Mayor Pro Tem
Kevin Sutton
John A. Black III
James Reno
Perry Sutton
Brent Faulkenberry
City MANAGEMENT
David B. Vehaun
City Manager
Jimmy Bagley
Deputy City Manager
CITY DEPARTMENT HEADS
Mike Blackmon Fire Chief
Deana Keever Human Resources Director
Anne Harty Chief Financial Officer
Cindi Howard General Services Director
Mike Jolly Electric Director
Heather Lawson Water/Sewer Director
Leah Youngblood Planning & Development Director
Terrence Nealy Public Works Director
Chris Watts Police Chief
Lisa Brown Economic & Urban Development Director
Melanie Brandon Neighborhood Services Director
Jeremy Winkler Director of Government Affairs
Steven Gibson
Deputy City Manager
Mark Sexton Parks, Recreation, & Tourism Director
Strategic Plan & FY 2024 Year End Report City Reports
Numerous City reports and documents offer the public essential insights into our plans, objectives, and achievements. Below are brief descriptions of some of these important documents.
The Rock Hill Strategic Plan for FY 2025–FY 2027 serves as a blueprint for realizing the City's vision, focusing on Serving the Community, Engaging Residents, and Growing Rock Hill. It aligns financial resources with initiatives and impacts the City’s work plans. Elected officials regularly assess progress, and a year-end report published in August evaluates the achievement of strategic goals, ensuring accountability to the City Council and residents. The FY 2024 report details accomplishments from the second year of the plan and is available on the Government Transparency and Performance section of the City’s website.
Annual Comprehensive Financial Report
The Popular Annual Financial Report (PAFR) summarizes the Annual Comprehensive Financial Report (ACFR) of governmental entities, ensuring accuracy through independent audits. The ACFR includes an introductory section, financial data, statistical information, and federal awards, all following GAAP standards. In FY 2023, Rock Hill was recognized for exceptional financial reporting.
CITY AWARDS & CERTIFICATIONS
During Fiscal Year 2024, several awards & certifications were received from regional, state, and national partners, highlighting numerous programs and initiatives in Rock Hill.
Money
The 50 Best Places to Live in the United States Money named Rock Hill one of the best places to live. This award celebrates cities and towns where a thriving economy meets affordability, diversity, and an exceptional quality of life. The award is backed by rigorous research and data-driven analysis.
Fortune Magazine
2024 Best Places to Live for Families
Fortune Magazine analyzed over 2,000 cities and nearly 200 data categories, assessing livability, financial health, resources for aging adults, education, and wellness. Rock Hill was recognized as a community well suited for both the youngest and oldest of residents.
Government Finance Officers Association Triple Crown Award
GFOA's Triple Crown recognizes governments that have received GFOA's Certificate of Achievement for Excellence in Financial Reporting, the Popular Annual Financial Reporting Award, and the Distinguished Budget Presentation Award.
Carolina Business Journal 2024 Most Admired CEO
This award recognizes established local leaders who have a strong vision for their companies, have shown commitment to culture in the workplace and made significant contributions to the Charlotte community. David Vehaun was recognized by the CBJ at its awards ceremony in June.
CITY AWARDS & CERTIFICATIONS
(Continued)
American Public Power Association
RP3 Award-Diamond Designation
The City was recognized by the American Public Power Association as a Reliable Public Power (RP3) Award recipient for the seventh time. This award recognizes the City of Rock Hill as a leading power provider on a national level. For the third time, the City’s RP3 award included the Diamond designation placing the City among the top recipients for this award.
Results for America’s, What Works Cities at Results for America
Silver
Certification
Our strategic planning team was recognized for using data to make lives better by prioritizing resident wellbeing. To date less than 100 cities worldwide have received this designation.
National Institute for Automotive Service Excellence (ASE) Blue Seal Certification
The National Institute for Automotive Service Excellence (ASE) gauges the expertise of automotive professionals for service managers and customers. This is our ninth year as an ASE Blue Seal repair facility and Rock Hill is one of only a few municipal fleet divisions with this designation in South Carolina.
The Commission on Accreditation for Law Enforcement Agencies (CALEA) CALEA Reaccreditation
Every four years CALEA requires an on-site reassessment and review of compliance files to maintain reaccreditation. This assessment occurred in December 2023 and there were no issues identified. As a result, the Police Department received its 8th CALEA Reaccreditation.
Insurance Service Office (ISO) Class 1 Fire Designation
The Fire Department has achieved the prestigious Insurance Service Office (ISO) rating of Class 1, which is one of the most esteemed designations available nationwide.
Financial Transparency
The City of Rock Hill maintains various funds and funding sources that are included in its official financial statements. Additionally, the City provides accessible resources such as monthly financial reports, performance metrics, and comparisons of public service costs to assist residents in comprehending the City’s financial situation.
The City’s Performance Dashboard—www.Cityofrockhill.com/government
Financial Data
The City’s website features financial graphs for clearer trend visualization. The site provides information on competitive City tax and utility rates, benchmarking household expenses against 28 other cities. The City aims to set fiscally responsible rates that ensure reasonable costs for customers while maintaining quality infrastructure.
Major Trends
Source: York County Economic Development
The development of the budget and the details presented in the financial statements are influenced by various economic trends. These trends encompass the local economy, long-term financial effects on local and state levels, as well as the broader national economy.
ECONOMIC & DEMOGRAPHIC CHARACTERISTICS
One of the major focuses of workforce development is an industry skills analysis to understand the existing workforce and industries.
The Talent Pipeline helps connect interns with businesses and through a grant program, subsidizes the cost of these interns. Following a period of staff transition and funding gaps, the Talent Pipeline will relaunch in the Fall of 2024 with grant funding from the United Way and the Community Development Block Grant. Enough funding has been secured to relaunch this program with 18 students and 15 employers. A renewed focus this round will include supporting small businesses throughout the City and a more formalized onboarding for students.
Our staff are also working on a resource guide to help stakeholders connect locally and articulate resources for job seekers, employers, and partners in a more holistic fashion. The intention is to minimize efforts that are duplicated and have a clear understanding of the workforce ecosystem.
Williams & Fudge, Inc. 370
City Revenue
General revenue includes property taxes, investment income, funding from other governments, and hospitality taxes. Property taxes make up 14% of total City revenues, unchanged from FY 2023. Charges for services, such as business licenses and utility bills, comprise 65% of revenues, down 8% from FY 2023. Operating grants account for 4.3% of revenues, a decrease of 1.3%, while capital grants make up 2%, declining by 0.8%. Overall, total revenue rose 15.4% from FY 2023 to FY 2024, increasing from $282 million to $325 million, with property tax and service charges trending upward as Rock Hill develops.
Tax Revenue
The General Fund acknowledges various revenue streams that contribute to City operations; however, most municipal activities rely heavily on tax revenue, business licenses, and permits. 67% of the revenue for municipal operations comes from three primary sources: Property Taxes, Licenses, and Permits.
City Expenses
Program expenses are typically categorized by City departments. Additionally, the City’s utility funds, which consist of electric, water, wastewater, and stormwater, are accounted for separately. There are two main expense categories that encompass various departments and divisions within the City:
Government– includes many of the support functions in City government like Planning and Development, Finance, and Human Resources.
FY 2024 CITY OF ROCK HILL EXPENSES
CHANGES IN EXPENSES BETWEEN FY 2023 & FY 2024
Overall, expenses rose by 7.5% when comparing FY 2023 to FY 2024. This increase can primarily be attributed to inflation affecting operating costs, particularly personnel expenses.
Every year, the City adopts an annual operating budget based on priorities articulated in the strategic plan. The City has two main types of funds, governmental and enterprise funds. The general fund, the largest governmental fund, is financed primarily by property taxes and business licenses. The enterprise funds of electric, water, sewer, and stormwater are mainly financed through charges for service.
When comparing budgeted expenses to actual costs, it's crucial to recognize that many discrepancies arise from varying accounting methods; budgetary results are typically calculated using a cash or modified accrual basis, rather than the strict accrual basis mandated by GAAP for accounting records.
In reviewing the FY 2024 budget against the actual figures for the general fund, both revenue sources and expenses exceeded budgeted amounts, ending the year within budget. The General Fund balance saw an increase of $2.9 million in FY 2024.
Similarly, the enterprise funds concluded the fiscal year within budget.
Lastly, a new personnel resolution was established to support Rock Hill's most valuable asset—its employees.
The City is committed to maintaining reasonable property tax rates, ensuring a balance between community needs and responsible management of public funds. For the past decade, the City’s millage rate has consistently stayed at 93.5 mills. Over the last twenty years, there has been a 12% reduction in the tax millage rate. This low millage rate reflects the City’s dedication to financial responsibility and its ability to utilize the community's growth effectively.
Debt
A significant aspect of Rock Hill's long-term financial strategy revolves around effective debt management. The City exercises fiscal responsibility when it comes to both issuing and repaying debt. Typically, debt is utilized for substantial capital projects. These projects and their funding are incorporated into the annual capital improvement plan and are evaluated quarterly by the management team.
At the conclusion of the current fiscal year, the City reported a total bonded debt outstanding of $610 million. Out of this total, $10.5 million is backed by the City’s full faith and credit. The remaining debt consists of bonds secured exclusively by designated revenue sources, including revenue bonds, stormwater loans, local accommodations tax revenue, developer assessments, and tax increment bonds.
In addition to the routine payments on existing bonds, the City issued $9.9 million in state revolving fund loans aimed at enhancing its water and wastewater facilities. Furthermore, it issued $162 million in combined utility system revenue bonds, mainly to further the expansion of its wastewater treatment plant.
The City is evaluated for its overall credit worthiness and for specific debt issuances. A good credit rating reduces borrowing costs and generally reflects an organization’s sound financial practices. Standard and Poor’s describes the “AA-” rating as “very strong capacity to meet financial commitments.” For utility-related debt, the City has maintained an “A+” rating from Standard and Poor’s and “A2” from Moody’s. Moody’s describes “A2” as “upper-medium grade” and “subject to low credit risk.”
Capital assets represent 76% of the City’s assets. Major capital asset events during the current year include the following:
The City completed several other infrastructure projects in Knowledge Park.
The City’s electric, water, sewer and stormwater departments invested nearly $6,800,000 of operating revenues into additions to plant in service.
Using a combination of revenue bonds and state revolving fund loans, the City continued major expansions of its water treatment plant and its wastewater treatment plant.
Several Neighborhood & Stormwater Area Improvement Projects were completed.
Capital assets encompass any property, equipment, or infrastructure (such as bridges, roads, sidewalks, etc.) valued over $5,000 and expected to have a useful life of at least one year. These assets are depreciated over time using a straight-line method according to their type. As of June 2024, the City's net investment in capital assets amounted to $466 million (after accounting for accumulated depreciation and related debt). This represents a 4.2% increase compared to the previous fiscal year.
2024
There are a number of infrastructure projects underway throughout the City. All of these projects will have a positive impact on future development in the City and will provide needed enhancements for Rock Hill’s residents. A sample of the current projects is as follows:
THE CITY BEGAN CONSTRUCTION OF THREE NEW MAJOR PARKS, RECREATION, & TOURISM PROJECTS: AN INDOOR BASKETBALL COURT FACILITY NEAR ITS SPORTS AND EVENTS CENTER, RENOVATIONS TO MCGIRT AUDITORIUM AND A NEW REGIONAL PARK
CITYWIDE CONNECTIVITY PROJECTS
INFRASTRUCTURE FOR CITY PARKING
CONNECT DOWNTOWN & UNIVERSITY CENTER DEVELOPMENT
WASTEWATER TREATMENT PLANT UPGRADES AND TREATMENT CAPACITY EXPANSION
The statement of net position is the balance of the City’s assets, or resources, minus the City’s liabilities, or financial obligations. This statement combines all governmental and business-type activities. When comparing all assets and liabilities, the City had a total, positive net position of $455 million as of June 30, 2024. The City’s overall net position increased by 8% between FY 2023 and FY 2024. This increase is due to operating within budget and also investing in infrastructure in a fiscally responsible manner. The City of Rock Hill has seen steady increases in its net position over the last few years—adding new and maintaining existing facilities and infrastructure in a high-quality manner. Strong financial management is the key to Serving, Engaging, and Growing.
