CITY OF SUFFOLK, VIRGINIA
POPULAR ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDING JUNE 30, 2019
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TO THE CITIZENS OF SUFFOLK The 2019 Popular Annual Financial Report (PAFR) is a report for our citizens. It provides you and other interested parties with an overview of the City’s financial results. This report is prepared to increase awareness throughout the community of the City’s financial operations; therefore, it is written in a user-friendly manner. The information is derived from the audited financial statements in the City’s 2019 Comprehensive Annual Financial Report (CAFR), our formal annual report. To conform with generally accepted accounting principles (GAAP), the CAFR must include the City’s component units and the presentation of individual funds in much more detail, as well as full disclosure of all material events, financial and nonfinancial. The 2019 CAFR was audited by Cherry Bekaert LLP and has received an unmodified or “clean” audit opinion. Unlike the CAFR, 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. The PAFR is not required to present the same level of detail as the CAFR and, therefore, does not fully conform to GAAP. This report, in a summarized version, highlights the overall financial condition and trends of the City. For more in-depth information, you may obtain a copy of the CAFR on the City’s website at www.suffolkva.us or by contacting the Finance Department at (757) 514-7500.
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TABLE OF CONTENTS Mayor’s Message City Leadership
05
About Our City
03
Suffolk Priorities:
07 08 -12
Expanded Economic Development
08
Growth Management and Comprehensive Planning / Public Education
09
Transportation
10
Leisure, Health, and Wellness / Public Safety / Civic Engagement and Responsive Citizen Services
11
Financial Stability
12
Where the Money Comes From
13
Where the Money Goes
14
Net Position
15
Capital Assets
16
Debt Administration
17
More Information
18
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MAYOR’S MESSAGE On behalf of the Suffolk City Council, it is my pleasure to present the 2019 Popular Annual Financial Report. It has been another remarkable year for Suffolk as the City continues to strive towards excellence. If there’s one thing I’ve come to appreciate over the years, it’s the knowledge that inspiration and growth only come from adversity and challenge, from stepping away from what’s comfortable and familiar, and stepping out into the unknown. As a City, we’ve also done just that, and we have a remarkable success story to share as people and businesses alike continue to make the decision to come grow with us!
accredited Parks & Recreation Department. We opened our first Inclusive Playground this fall at Lake Meade Park near Downtown which offers an inclusive experience for people with disabilities, their families, and friends. Another such playground is in the works for the northern end of our City.
Our population numbers are growing according to the U.S. Census Bureau. We continue to be one of Virginia’s faster-growing localities. More and more people are choosing to call Suffolk “home”, and we’ve seen the largest percentage increase in home sales in the region, growing by 8.6% over the previous year. We’re also ranked in the Top Ten when it comes to affordable housing in Virginia according to information recently shared by the media.
Here, hometown charm isn’t a cliché – it’s our way of life and something experienced and exhibited in Suffolk every day! That is especially true as it relates to our Historic Downtown and the ongoing renaissance of our commercial core. The energy of entrepreneurs is palpable Downtown, and if you haven’t joined us lately, come experience, see, and taste what so many are talking about. The focus is a fusion of cultures, and here you can find it all!
When it comes to our financial success, we can proudly report that the City received its third AAA rating from Moody’s Investors Service late this fall, now joining Fitch Ratings and Standard & Poor’s Rating Service in bestowing this coveted designation, one shared by only a handful of other Virginia cities.
In Suffolk, when it comes to Economic Development, we’ve cultivated an environment that is ideal for growing a thriving business! Our continued success is rooted in carefully planned strategic growth and investment that helps us maintain a strong financial standard and sound foundation on behalf of our citizens. More exciting announcements are on the horizon!
The City has been successful in leveraging local dollars to obtain significant state and federal funding. We were also awarded $16.1 million in funding from VDOT for the Nansemond Parkway/ Wilroy Road Overpass from the Commonwealth Railway project to provide a long term permanent solution to the ongoing traffic and train conflict at this intersection. Our recreational opportunities are also continuing to expand and develop thanks to our nationally
A city can only move forward when it has a strong foundation to build upon, and we know that public safety is our fundamental building block. We can proudly state that we are not only fortunate to have the very best public safety professionals in the region, but they are also prepared with the latest equipment and technologies – all designed to keep our citizens safe. Public safety is more than just response times and crime stats – it’s also about engagement. Involved, active neighborhoods are essential to the quality of life that we enjoy.
As the Mayor of Suffolk, I have the humbling opportunity to see and experience the many facets and interworking of my community and the people that make it all possible. I see the challenges, the struggles, the opportunities and the celebrations. And no matter the high or the low, I’m always left with the impression of the incredible human spirit that exists in our City. We all get the same 365 days every year. The only difference is what we do with them.
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“Here, hometown charm isn’t a cliché – it’s our way of life and something experienced and exhibited in Suffolk every day!”
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CITY LEADERSHIP The City of Suffolk is governed by a Mayor and seven City Council members who are elected by borough. Appointed by the Council, the City employs a full-time city manager to oversee the operations. The Suffolk City Council has an established vision for the City which sets the course for Suffolk over the next 15 years. Vision 2035 is as follows: Suffolk is a vibrant and fiscally strong community leading the region in advancements in education, comprehensive transportation, public safety and diverse economic growth while continuing to preserve its rural heritage and enhancing its neighborhoods and urban centers. Throughout 430 square miles of rich land and pristine waterways, citizens and tourists treasure the beautiful trails, rivers and open spaces. Residents, visitors and merchants delight in the revitalized downtown featuring cultural, educational and recreational opportunities. Diverse shopping, businesses and entertainment venues abound. A sense of harmony and pride permeates this rare community, where crime is low; where schools are cutting edge; where people and goods move safely and efficiently throughout the city; and where citizens receive valuable services and have opportunities to be engaged. Suffolk is the desired destination of the Hampton Roads Region.
The City will achieve this by focusing on the following Priorities, each of which will be highlighted within this report: •
Expanded Economic Development
•
Public Education
•
Leisure, Health, and Wellness
• Transportation •
Public Safety
•
Financial Stability
•
Growth Management and Comprehensive Planning
•
Civic Engagement and Responsive City Services
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Back Row: Timothy J. Johnson, Holy Neck Borough; Lue R. Ward, Nansemond Borough; Roger W. Fawcett, Sleepy Hole Borough; Donald Z. Goldberg, Suffolk Borough. Front Row: Curtis R. Milteer, Sr. Whaleyville Borough; Linda T. Johnson, Mayor; Leroy Bennett, Vice Mayor Cypress Borough; Michael D. Duman, Chuckatuck Borough.
Patrick Roberts, City Manager
If you have questions about this report, or need additional financial information, please contact the Finance Department of the City of Suffolk by email, FinanceEmail@suffolkva.us, by phone at 757-514-7500, or by mail at Finance Department, City of Suffolk, P.O. Box 1858, Suffolk, VA 23434.
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ABOUT OUR CITY The present City of Suffolk was formed January 1, 1974, from the consolidation of the City of Suffolk and the City of Nansemond (formerly Nansemond County). The City is Virginia’s largest city in land area and one of the top fifteen largest cities in land area in the nation with over 400 square miles of land mass and 30 square miles of waterways. The diverse landscape includes a mix of rural, suburban and urban development areas. The City is situated in the western portion of Hampton Roads, Virginia’s coastal plain area, and is bound by the James River to the north, the Cities of Chesapeake and Portsmouth to the east, the State of North Carolina to the south, and the Counties of Southampton and Isle of Wight to the west. The City of Suffolk is one of seven major cities that form the Norfolk-Virginia Beach-Newport News metropolitan area with 1.7 million people. This region is also known as the Hampton Roads area. The City’s government is organized under the Council-Manager form of
government. The governing body, the City Council, is composed of seven members and a Mayor who collectively develop policies for the administration of the City. The Mayor is elected at large and each Council Member is elected by borough in a citywide election every other year, with terms of office being four years. The City Council appoints a City Manager to act as administrative head of the City. The City Manager serves at the pleasure of City Council and carries out the City Council’s policies and directs business procedures. The City Manager also appoints the Directors of all Departments. As a full service City, Suffolk provides a broad range of municipal services authorized by statute or charter. These services include education, public safety, highways and streets, parks and recreation, sanitation, health and social services, public improvements, planning and zoning, public utilities, storm water management and general administrative.
SUFFOLK’S PROFILE - FISCAL YEAR 2019 QUICK FACTS Consolidated as City of Suffolk and City of Nansemond (formerly Nansemond County)
January 1, 1974
GEOGRAPHY Land Water
400 square miles 30 square miles
GOVERNMENT Form of Government Council-Manager Chief Elected Official Mayor 8-Member City Council 4-Year Terms Full Time Equivalent City Employees 1362
DEMOGRAPHICS* Population Unemployment Rate Median Household Income* Median Home Cost
92,714 3.3% $65,435 $263,451
*Sources: Weldon Cooper Center for Public Service, Virginia Employment Commission, Bureau of Economic Analysis, U.S. Census Bureau.
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SUFFOLK PRIORITIES EXPANDED ECONOMIC DEVELOPMENT ECONOMIC DEVELOPMENT EFFORTS BROUGHT 635 NEW JOBS TO SUFFOLK IN 2019. Suffolk is one of the fastest growing cities in Hampton Roads and is well positioned for continued growth and prosperity. With a diversified and skilled workforce, proximity to the Port of Virginia, available land for development, efficient transportation access, high quality of life, a regard for its historic past and a dynamic vision for the future, Suffolk continues to attract new business and investment, create jobs, and provide an invigorating economic climate for expansion. Noted nationally for job creation and as one of the most livable cities, Suffolk continues to capitalize on its assets in a top-ranked business-friendly state.
Median Household Income (MHI) has grown in the City by 63% from 2000 to 2016. The City of Suffolk now has the third highest MHI in the region, which is also higher than both the state and national MHI. THE ECONOMY OF SUFFOLK IS CONTINUING TO GROW AS EVIDENCED BY THE FOLLOWING TRENDS: • Unemployment is 3.3%, down from 4.1% in the previous year. • Median Household Income is $65,435.
NEW AND EXPANDING BUSINESS HIGHLIGHTS JANUARY 1 – DECEMBER 31, 2019 NEW BUSINESS SECTOR INVESTMENT TRICARE Prime Suffolk Bridgeport by BECO Smithfield Foods Truitt House
Office & Admin Speculative Mixed Use Office & Admin Hospitality
$ 2,700,000 $ 10,000,000 $ 1,800,000 $ 1,000,000
EXPANDING BUSINESS SECTOR INVESTMENT TowneBank Wanchese Fish Co – Cooke Seafood Bluebell Creameries Lipton Target
Office & Admin Food & Beverage Processing Warehousing & Distribution Food & Beverage Processing Warehousing & Distribution
$ $ $ $ $
9,000,000 4,600,000 7,000,000 2,995,000 2,900,000
New and existing businesses invested $55 million in creating or expanding business in Suffolk in 2019.
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SUFFOLK PRIORITIES GROWTH MANAGEMENT AND COMPREHENSIVE PLANNING
Suffolk features many development types and character types, from dense, walkable urban neighborhoods, to riverside communities, and rural villages. The plan emphasizes enhancing existing character and promoting quality new development. Suffolk continues to see population growth with a 12% increase since 2010. Over the past 19 years, the population in Suffolk has grown by 50%. This population trend is projected to continue over the foreseeable future. By 2040, we expect to see an increase in population by 28%.
The Suffolk Department of Planning and Community Development presented twelve ordinance text amendments to the Planning Commission and City Council for consideration, addressing noise, food trucks, family transfers, mini-warehouses, lot and design standards, and other items. They also managed the review and approval of 39 site plans, 57 site plan waivers/minor site plans, and six engineering plans. Suffolk features many unique neighborhoods, beautiful natural landscapes, and small-town charm. The City faces the challenge of maintaining these and other valued assets while experiencing sustained growth. This desire to accommodate growth while preserving Suffolk’s special features has prompted the City to address service provisions, connectivity, environmental protection, and the quality of life and traditions as the City continues to grow and develop.
PUBLIC EDUCATION The City Council and City Management place a high priority on education in the City. Over the next ten years, approximately $297.6 million has been appropriated or planned for in the Capital Improvements Plan for renovations and new schools, as well as to provide for HVAC improvements and a new operations facility.
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TRANSPORTATION
The residential growth and change in Suffolk require the City to be proactive in planning for its future to insure efficient and effective delivery of services and a high quality of life for its citizens. The transportation network plays a key role in accommodating growth within Suffolk and providing connections throughout the region. The 2015 Comprehensive Plan addresses areas of limited connectivity within the City, as well as issues such as congestion, heavy freight traffic, emergency preparedness, and promoting mobility and alternate forms of transportation.
Fiscal Year 2019 Accomplishments
• Increased transit ridership by 17% over the last two years. • Inspected 75 bridges to meet State and Federal standards and initiated the replacement of three structurally deficient bridge structures at Southwestern Boulevard, Simons Drive, and Badger Road. • Implemented additional hours, Monday – Friday, on three existing bus routes allowing riders more access to previously limited service routes. • Installed five new bus shelters and purchased two new buses and two new paratransit vans.
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SUFFOLK PRIORITIES LEISURE, HEALTH, AND WELLNESS • Suffolk was selected for the list of one of the Best Cities for Young Families in Virginia by NerdWallet, a personal finance site for consumers. Among factors considered were home affordability, prosperity and growth, quality of education, and family friendliness. • Participated in the Best Practice Court Team to improve outcomes for foster care youth and address truancy and related issues in coordination with the school system. • Suffolk received the Stairway to Success Award – Good Level, recognizing the City’s excellence in its commitment to Early Childhood Education at the Virginia Municipal League (VML) Annual Banquet. • Provided immunization services to 572 citizens and family planning services to 756 citizens.
COMPLETED CAPITAL PROJECTS • Inclusive Playground at the Kids Zone Community Playground • Fire & Rescue Operations Building • Trail enhancements
PUBLIC SAFETY • Completed first Fire & Rescue Academy. Conducted fire and life safety presentations for residents of the Suffolk Redevelopment and Housing Authority. Conducted Youth Fire and Life Safety Camps. • Trained 30 new volunteers in a variety of activities including adoption events, animal foster care, and staff assistance at the animal shelter. • Obtained Commission on Accreditation for Law Enforcement (CALEA) for Emergency Communications. • Implemented Phase II of the technical rescue program to bring members of Engine 2 and all the Ladder Companies up to operations level in the core rescue disciplines.
CIVIC ENGAGEMENT AND RESPONSIVE CITY SERVICES • The Suffolk Public Library launched expanded WiFi2Go program to provide wireless internet access to people with needs throughout the community. • Suffolk Commonwealth’s Attorney’s Office held both a Citizens Academy and CSI Camp for children ages 12-15 years of age. • Suffolk’s 2019 National Night Out celebration event was named in the Top 5 in the nation among communities with a population of 50,000 to 100,000 residents by the National Association of Town Watch.
CITIZEN REPORTING • Received the Award for Outstanding Achievement in Popular Annual Financial Reporting from the Government Finance Officers Association of the United States and Canada (GFOA). • Produced the State of the City event in-house resulting in annual savings of $30,000.
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FINANCIAL STABILITY
The City is committed to being responsible stewards of our taxpayer dollars and will continue to address the strategic needs and priorities of the City through the implementation of cost reduction strategies. Financial policies are vital in maintaining consistency and focus. A good measure of the City’s ability to cope with unexpected financial challenges or emergencies is the ratio of unassigned General Fund balance as a percentage of the budgeted governmental funds expenditures. The target for this ratio is 15%. At June 30, 2019 the fund balance ratio exceeded the target.
OTHER ACCOMPLISHMENTS • Received AAA bond ratings from all three bond rating agencies. • Achieved a current 3-year combined real estate and personal property tax collection rate of 99.5%. • Achieved 100% of the City’s financial policy goals through the adopted annual operating budget. • Facilitated the sale of surplus items resulting in over $100,000 in proceeds.
FINANCIAL REPORTING AWARDS Comprehensive Annual Financial Report
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Suffolk, Virginia for its comprehensive annual financial report for the fiscal year ended June 30, 2018, representing the thirty-fifth consecutive year that the City has received this award. The Certificate of Achievement is a prestigious national award recognizing conformance with the highest standards for preparation of state and local government financial reports. In order to be awarded a Certificate of Achievement, a governmental unit must publish an easily readable and efficiently organized comprehensive annual financial report, whose contents conform to program standards. Such reports must satisfy both accounting principles generally accepted in the United States of America and applicable legal requirements.
Annual Budget
The Government Finance Officers Association of the United States and Canada (GFOA) presented a Distinguished Budget Presentation Award to the City of Suffolk, Virginia for its annual budget for the fiscal year beginning July 1, 2019. In order to receive this award, a governmental unit must publish a budget document that meets program criteria as a policy document, as an operations guide, as a financial plan, and as a communications device. This is the twelfth consecutive year for this recognition as it is valid for a one-year period.
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WHERE THE MONEY COMES FROM
When assessing the financial results of the City, it is important that we focus on the City’s General Fund. This page and the next report General Fund financial data only. The General Fund is the general operating fund of the City and supports the regular day-to-day operations of the City. It is used to account for all revenues and expenditures of the City, except those required to be accounted for in another fund such as Capital Projects, Grants and Debt Service Funds, and Utility, Refuse, and Stormwater Activities.
In total, 2019 revenue increased by approximately $12.6 million when compared to 2018. Like all governments, the City must raise funds to pay for the services that it provides to its citizens and businesses. These sources of funds, referred to as revenue, are raised through grants, charges and taxes.
GENERAL FUND REVENUE BY SOURCE (IN MILLIONS) EXCLUDING TRANSFERS General Fund Revenue By Source (In Millions)
Other Local Taxes $46.3 - 21.2%
Fines and Forfeitures $0.8 - 0.4% Revenue from Use of Money and Property $3.0 - 1.4%
FY Ending FY Ending 06/30/2018 06/30/2019 $ 125.2 $ 133.8 45.7 46.3 1.5 1.3 0.9 0.8 2.0 3.0 3.3 3.6 1.5 1.8 20.3 21.4 4.9 5.9 $ 205.3 $ 217.9
61.4% 21.2% 0.6% 0.4% 1.4% 1.7% 0.8% 9.8% 2.7% 100.0%
FY Ending FY Ending Expenditures by Function: 06/30/2018 06/30/2019 General Government Administration $ 16.3 $ 16.2 Judicial Administration 8.2 8.8 Public Safety 59.7 62.4 Public Works 0.9 1.0 Health and Welfare 13.3 13.6 Education 60.4 The chart above indicates the growth in56.5the General Parks, Recreation and Cultural 10.9 12.0 Property Tax revenue over the past ten years. The increase Community Development 5.9 is due 4.6 in the real estate and personal property taxes to 0.2 0.7 aNondepartmental combination of an increase in the overall assessed value Totalwell Expenditures $ 179.7 as as limited tax rate increases$ for 171.9 education and
9.0% 4.9% 34.7% 0.6% 7.6% 33.6% 6.7% 2.6% 0.4% 100.0%
Revenue by Source: Real Estate and Personal Property Taxes Other Local Taxes Permits, Fees and Regulatory Licenses Fines and forfeitures Revenue from Use of Money and Property Charges for Services Miscellaneous State Revenue Federal Revenue Total Revenues
Permits, Fees and Regulatory Licenses $1.3 - 0.6%
Charges for Services $3.6 - 1.7% Miscellaneous $1.8 - 0.8% State Revenue $21.4 - 9.8%
Federal Revenue $5.9 - 2.7% Real Estate and Personal Property Taxes $133.8 - 61.4%
** Do not include Transfers In Page 16 of CAFR General Fund Expenditures by Function (In Millions)
public safety.
Page 16 and page 43 (Transfers to) of the CAFR ** Do not include Transfers Out for Debt and Other The Page 16 City of CAFR of Suffolk has a variety
of sources of revenues to fund operations. The largest general fund revenue sources are real estate and personal property taxes, followed by other local taxes and state revenue.
Permits, Fees and Regulatory Licenses Fines and forfeitures Revenue from Use of Money and Property Charges for Services Miscellaneous State Revenue Federal Revenue Total Revenues
1.5 0.9 2.0 3.3 1.5 20.3 4.9 205.3 $
1.3 0.8 3.0 3.6 1.8 21.4 5.9 217.9
0.6% 0.4% 1.4% 1.7% 0.8% 9.8% 2.7% 100.0%
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WHERE THE MONEY GOES $
Once the City collects taxes and other revenues, the monies must be spent efficiently to provide services to the ** Do not include Transfers In of the City. As this section will further detail, the City provides a variety of services to its citizens and businesses Page 16 of CAFR residents and businesses.
GENERAL FUND EXPENDITURE BY FUNCTION General Fund Expenditures by Function (In Millions) (IN MILLIONS) EXCLUDING TRANSFERS FY Ending FY Ending Expenditures by Function: General Government Administration Judicial Administration Public Safety Public Works Health and Welfare Education Parks, Recreation and Cultural Community Development Nondepartmental Total Expenditures
06/30/2018 06/30/2019 $ 16.3 $ 16.2 8.2 8.8 59.7 62.4 0.9 1.0 13.3 13.6 56.5 60.4 10.9 12.0 5.9 4.6 0.2 0.7 $ 171.9 $ 179.7
9.0% 4.9% 34.7% 0.6% 7.6% 33.6% 6.7% 2.6% 0.4% 100.0%
Public Safety,
Page 16 and page 43 (Transfers to) of the CAFR $62.4 - 34.6% ** Do not include Transfers Out for Debt and Other PageAdministration, 16 of CAFR Judicial $8.8- 4.9%
General Government Administration, $16.2 - 9.0%
Public Works, $1.0 - 0.6%
Health and Welfare, $13.6 - 7.6%
Nondepartmental, $0.7 - 0.4%
Community Development, $4.6 -2.6% Parks, Recreation and Cultural, $12.0 - 6.7%
Education, $60.4 - 33.6%
Education is a top priority for the City as evidenced by the fact that it is one of the largest budgeted general fund expenditures in FY19 and increased by $3.9 million over FY18 expenditures. The Real Estate tax rate of $1.11 per $100 of assessed value is the 3rd lowest in the region.
The City is committed to ensuring the highest level of safety for its citizens and has expended $62.4 million towards public safety efforts in FY19, which represents an increase of $3.9 million over FY18 expenditures.
Annually, the City Manager submits a Budget for City Council’s adoption. The proposed budget must not include expenditures that exceed anticipated revenues and anticipated income. The budget process is approached with a focus on maintaining core services critical to residents, while simultaneously identifying sustainable savings that strengthen the City’s ability to deliver services more efficiently and effectively.
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NET POSITION
The Statement of Net Position presents information on all City assets and deferred outflows of resources and (Tables andand Charts - MDA Netinflows Position)of resources with the difference reported as net position. This data is inclusive of all liabilities deferred the activities of the City but does not include City component units. Net position is one way to measure the City’s CITY OF SUFFOLK, VIRGINIA financial health, or financial position. NET POSITION BY COMPONENT LAST TEN FISCAL YEARS
NET POSITION (IN MILLIONS) Current and other assets Capital and other non-current assets Total assets Deferred Outflows of Resources
Net Position Governmental Activities 2019 2018 $ 196.2 $ 186.9 531.7 575.2 727.9 762.1
Business-type Activities 2019 2018 $ 85.5 $ 93.1 458.2 463.4 543.7 556.5
2019 $ 281.7 989.9 1,271.6
Total
2018 $ 280.0 1,038.6 1,318.6
25.4
15.9
19.7
19.3
45.1
35.2
13.8 346.9 360.7
41.1 317.4 358.5
8.6 400.7 409.3
20.6 399.0 419.6
22.4 747.6 770.0
61.7 716.4 778.1
Deferred Inflows of Resources
12.6
14.9
1.1
1.6
13.7
16.5
Net position: Net investment in capital assets Restricted Unrestricted Net position
301.9 1.6 76.5 $ 380.0
336.0 2.1 66.5 $ 404.6
104.2 2.5 46.3 $ 153.0
108.5 2.5 43.6 $ 154.6
406.1 4.1 122.8 $ 533.0
444.5 4.6 110.1 $ 559.2
Current and other liabilities Long-term liabilities Total liabilities
The City has a solid financial position with 23.04% of net position, or $122.8 million, as unrestricted. The unrestricted portion of net position is available to allow the City to provide services to citizens. Net investment in capital assets (land, buildings, infrastructure, improvements, machinery and equipment, less accumulated depreciation and related outstanding debt used to acquire those assets) of $406.1 million comprises 76.19% of the net position. These assets are not available for future spending because they are assets used to provide services to citizens.
The City’s combined net position (which is the City’s “bottom line”) decreased by $26.2 million in fiscal year 2019, of which approximately 0.77% represents resources that are subject to external restrictions or enabling legislation. The decrease is due to the completion of the 2 new schools by the City and those school assets are being transferred to the school district.
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CAPITAL ASSETS
The City’s capital assets for its governmental and business-type activities as of June 30, 2019, totaled $989.9FY20189\CAFR\Tables million, net of accumulated This investment in capital assets includes land, buildings, N:\Finance\Audit and Charts FY2019depreciation. CAFR.xlsx (MDA Capital Assetsother Tab) than buildings, infrastructure, machinery and equipment and construction in progress. improvements
CAPITAL ASSETS (NET OF DEPRECIATION IN MILLIONS) (net of depreciation) Ca pita l Assets (in Millions)
Governmental Activities
Land Construction in progress Buildings Infrastructure Improvements other than buildings Machinery and equipment Intangibles Tota l
2019 24.2 75.4 91.5 263.2 36.7 38.3 2.4 531.7
Capital Assets Machinery and equipment 10%
Intangibles 1.4%
Land 3%
The City is committed to maintaining and adding to the infrastructure of the City through the Capital Improvement Plan. Some of the improvements contained in the City’s adopted ten year Capital Improvements Improvement Plan are as other than buildings 31% follows: • Pitchkettle Road Improvements •
New Central Library
•
New College Drive Fire Station
•
Nansemond Parkway/ Wilroy Road Flyover
•
Open space Improvements
$
$
Business-type Activities
2018 23.5 112.2 94.2 265.6 34.3 43.9 1.5
$
575.2
$
2019 4.7 25.0 75.0 278.1 64.8 10.6 458.2
$
$
Total
2018 5.6 25.6 77.5 275.4 67.2 12.1 463.4
$
$
2019 28.9 100.4 166.5 263.2 314.8 103.1 13.0 989.9
$
$
2018 29.1 137.8 171.7 265.6 309.7 111.1 13.6
0.029195 0.101424 0.168199 0.265885 0.318012 0.104152 0.013133
1,038.6
Capital Assets Capital Assets Construction in progress 10%
Machinery and Machinery and Intangibles Intangibles equipment equipment 308.8 1.4% 1.4% 10% 10% Buildings 17%
Improvements Improvements other than buildings Infrastructure other than buildings 31% 27% 31%
Land Land 3%3%
Construction in in Construction progress progress 10% 10% Buildings Buildings 17% 17%
Infrastructure Infrastructure 27% 27%
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DEBT ADMINISTRATION Long-term debt: At the end of the current fiscal year, the City had total outstanding debt of $680.6 million, including general government, school construction and N:\Finance\Audit FY20198\CAFR\Tables and Charts FY2019 CAFR.xlsx utility fund (MDA LT Debt Tab) debt.
OUTSTANDING DEBT (IN Outstanding MILLIONS) Debt (in millions) Bonds payable Bond Premiums
Governmental Activities 2019 2018 262.3 $ 262.4 22.7 23.7
$
Business-type Activities 2019 2018 365.9 $ 375.8 27.1 28.6
Total $
2019 628.2 49.8
$
2018 638.2 52.3
Ca pita l lea ses
2.0
3.5
0.6
0.8
2.6
4.3
Loans and notes payable
-
1.7
-
-
-
1.7
Total
287.0
$
291.3
$
393.6
$
405.2
$
680.6
$
696.5
The Commonwealth of Virginia limits the amount of general obligation debt outstanding to 10% of the locality’s assessed value of real property, which is $980.2 million for 2019. The City Charter further limits this general obligation limit to 7% of the City’s assessed value of real property or $686.1 million. Of the debt shown above, only $434.9 million is general obligation debt that is applicable to the legal debt limits. The City has met both of the legal debt limits. Achieving these limits represents the City’s conservative debt borrowing policy.
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MORE INFORMATION The Government Finance Officers Association (GFOA) has been promoting the preparation of high quality popular annual financial reports since 1991. More than 140 governments participate in the program each year. The Popular Annual Financial Reporting Awards Program is specifically designed to encourage state and local governments to prepare and issue a high quality popular annual financial report. Popular annual financial reports can play an important role in making financial information accessible to ordinary citizens and other interested parties who may be challenged by more detailed traditional financial reports. Additional details can be found at the GFOA website: www.gfoa.org.
WE WANT TO HEAR FROM YOU Do you like this report? What other information would you like to see contained in this report? Please let us know by contacting the Finance Department at FinanceEmail@suffolkva.us, or 757-514-7500. Please see the City’s website at www.suffolkva.us, for additional information, including the City’s Comprehensive Annual Financial Report and the City Profile and Statistical Digest.
CITY OF SUFFOLK
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