CITY OF FAYETTEVILLE, GEORGIA MANAGEMENT’S DISCUSSION AND ANALYSIS

JULY 31, 2021

The Management’s Discussion and Analysis (“MD&A”) of the City of Fayetteville, Georgia’s (the “City”) financial performance provides an overall review of the City’s financial activities for the fiscal year ended July 31, 2021. It is designed to give the reader an objective and easily readable analysis of the City’s financial performance. The primary intent of this MD&A is to look at the City’s financial performance as a whole; readers should also review the letter of transmittal, notes to the basic financial statements, and the financial statements to enhance their understanding of the City’s financial performance.

Financial Highlights

Key financial highlights for FY 2021 are as follows:

In total, combined net position increased by $3,921,293 which represents a 3.71% increase over FY 2020. This increase can primarily be attributed to investments in capital assets.

• Combined tax revenues accounted for $17,301,222, or 65.14%, of all revenues from governmental activities. Service specific revenues in the form of charges for services, operating grants and contributions, and capital grants and contributions accounted for $9,186,656, or 34.72%, of total revenues of $26,456,221 from governmental activities.

• The City had $27,585,514 in expenses related to governmental activities; $9,186,656 of these expenses were offset by charges for services, grants, and contributions. General revenues (primarily taxes) of $17,270,565 provided for these services as well. The net result was a decrease in the City’s net position by $679,293

• Total Water and Sewer Fund revenues for FY 2021 were $7,792,215. Total expenses for FY 2021 were $7,361,986. Capital contributions were recorded in the amount of $5,131,031, including but not limited to donated property and sewer proportionate share. The change in net position after depreciation and nonoperating revenues/expenses was $4,576,397 for the FY 2021

• Revenues from the General Fund were $17,737,333 FY 2021, a decrease of approximately 2.05% over the prior fiscal year, due to a decrease in intergovernmental and interest income. General Fund expenditures totaled $16,580,404 for the fiscal year ended July 31, 2021, an increase of 1.1% over last fiscal year due mostly to an increase in interest expense for debt service for 2021.

Overview of the Financial Statements

This Annual Comprehensive Financial Report (“ACFR”) consists of a series of financial statements and notes to those statements. These statements are organized so the reader can understand the City as a financial whole, or as an entire operating entity.