MANAGEMENT’S DISCUSSION AND ANALYSIS

The special revenue funds are used to account for specific revenues that are legally restricted to expenditures for particular purposes. The City has eight Special Revenue Funds: 1) Confiscated Assets Fund, 2) Hotel/Motel Tax Fund, 3) Vehicle Excise Tax Fund, 4) Cemetery Fund, 5) Veterans Memorial, 6) Downtown Development Authority Fund, 7) Main Street Tourism Association Fund, and 8) American Recovery Plan Act (“ARPA”) Fund.

Proprietary Funds

Proprietary funds are activities that a City operates similar to a business in that it attempts to recover costs through charges to the user. The City’s only proprietary funds are enterprise funds. Enterprise funds may be used to account for any activity or service that charges a fee to external users to cover the cost of operations, including cost of depreciation and debt service. The City operates its water and sewer fund and solid waste fund as enterprise funds. Proprietary fund statements use the accrual basis of accounting similar to the City-wide statements.

Financial Analysis

The net position over time may serve as a useful indicator of a government’s financial position. In the case of the City of Fayetteville, Georgia, assets and deferred outflows of resources exceeds liabilities and deferred inflows of resources by $109,497,645, at the close of the most recent fiscal year.

The City’s overall net position increased $3,921,291 from the prior fiscal year. Net position for governmental activities decreased $679,291 from the prior fiscal year. The reason for this overall change in net position for governmental activities is mainly the result of increased capital outlay during the current fiscal year Net position for business-type activities increased $4,600,584 from the prior fiscal year. The reason for this overall change in net position for business-type activities is mainly the result of a decrease in operating expenses during the current fiscal year.