FUND SUMMARIES

FUND SUMMARIES

Fund Summaries............................................................................................................................. 14

Net Expenditures by Fund .............................................................................................................. 17

General Fund

Total General Fund Expenditures by Type ................................................................................ 18

Total General Fund Expenditures by Service Area .................................................................... 19

Total General Fund Resources by Type ..................................................................................... 22

General Fund Summary ............................................................................................................. 24

General Fund Balance Highlights .............................................................................................. 31

Internal Services Funds .................................................................................................................. 32

Debt Service Fund .......................................................................................................................... 33

Special Revenue Funds Detailed by Fund ...................................................................................... 34

Enterprise Funds ............................................................................................................................ 44

Capital Projects Fund ..................................................................................................................... 45

Leasing Capital Projects Fund ........................................................................................................ 47

Leasing Equipment Acquisition Fund ............................................................................................. 48

Enterprise Capital Projects Funds .................................................................................................. 49

Fiduciary Funds .............................................................................................................................. 51

Estimated Changes in Fund Balances ............................................................................................. 52

13

FUND SUMMARIES

FUND ACCOUNTING

Local government activities are budgeted and accounted for in a number of separate fiscal entities known as "funds." In the Winston-Salem City government, funds have been set up to segregate activities or objectives in accordance with special regulations, restrictions, or limitations. The funds established by the City of Winston-Salem fall into three categories: governmental, proprietary, or fiduciary. The budget includes all funds in these categories except for the police retirement fund (in the fiduciary category), which may be excluded from the local budget ordinances according to the North Carolina General Statutes in the Local Government Budget and Fiscal Control Act.

GOVERNMENTAL FUNDS

General Fund: The general fund is the principal operating fund of the City, accounting for the expenses and resources for services to the public such as police, fire, sanitation, streets, transportation, and recreation. These services are supported by general purpose revenues such as property taxes, local option sales tax, intergovernmental revenues, and charges for services, except for those that are designated by state law or local ordinance to be recorded in another fund group.

Special Revenue Funds: Special revenue funds provide full budgetary accountability for restricted or limited resources (other than assessments and operating or capital grants to enterprise funds). Restrictions on resources may be federal, state, or local. A special revenue fund is established when required by legal mandate or sound financial management practices. These funds include: Community Development Block Grant Fund, Home Investment Partnership Fund, HOPWA Fund, Housing Finance Assistance Fund, Economic Development Loan Fund, Economic Development Project Fund, Urban Development Action Grant Fund, Powell Bill Fund (Gas Tax), Grants Fund, Occupancy Tax Fund, Continuum of Care Grants Fund, Police Forfeiture Funds, Cable Franchise Fee Fund, State Emergency Telephone System Fund, and Downtown Winston-Salem Business Improvement District Fund.

Debt Service Fund: The debt service fund accounts for the accumulation of resources for the payment of interest and current maturities of general obligations. Long-term obligations and related debt service for water and sewer, parking, and other enterprise programs are recorded in their respective funds.

Capital Project Funds: The capital projects fund provides budgetary accountability for financial resources used for the acquisition or construction of major capital improvements. Typically, projects are funded by two-thirds bonds, federal and state capital funds, general fund balance appropriations, and capital reserves. Also included in the capital funds category are three capital leasing funds: the leasing equipment acquisition fund that accounts for the full cash value of lease purchased items; the leasing capital projects fund that accounts for all projects funded through leases; and the leasing fund that accounts for the lease borrowing amount, the lease payments, and the balloon payments to retire the lease-debt.

PROPRIETARY FUNDS

Enterprise Funds: Enterprise funds provide services that are nearly or fully self-supporting. The Local Government Budget and Fiscal Control Act does not define “enterprise,” but provides an understanding of the purpose for which such a fund is appropriate and dictates that they should be accounted for in separate enterprise funds. For the City, enterprise funds include water/sewer, solid waste disposal, stormwater management, public assembly facilities, off-street parking, and public transit.

14

FUND SUMMARIES

Enterprise Capital Project Funds: These funds provide budgetary accountability for financial resources used for the acquisition or construction of major capital improvements for enterprise or internal service operations. Typically, projects are funded by revenue bonds, special obligation bonds, enterprise fund capital reserves, federal and state capital funds, and limited obligation bonds.

Internal Service Funds: Internal service funds provide budgetary accountability for governmental activities that serve other City departments. An internal service fund is similar to an enterprise fund in that it is supported entirely by user charges. Included in the internal service funds are information systems, fleet management services, warehouse services, and the funds for workers’ compensation, current employee health benefits, dental, and flexible spending plans.

FIDUCIARY FUNDS

Employee Benefits Fund: This fund accounts for post-employment benefits and pension trust funds.

FUND SUMMARIES

Measurement Focus: Governmental funds (general, special revenue, debt service, and capital projects) use the "flow of current financial resources" as its measurement focus. This means that the financial statements report whether the fund is better or worse off financially in the short term as a result of transactions and events of the period. Proprietary funds (enterprise and enterprise capital funds) use the "flow of economic resources" as a measurement focus.

Basis of Accounting: Governmental funds use the modified accrual basis of accounting. Under this basis, revenues are recognized in the period received and are accrued if considered to be both measurable and available to pay current liabilities. Major revenue sources include property and other local taxes, intergovernmental revenues, and investment income. Expenditures are recognized when a liability is incurred. An exception to this practice is interest on general obligation debt, which is reported according to due date.

Proprietary funds use the full accrual basis of accounting. Under this basis, revenues are recognized in the period earned, and expenses are recognized in the period incurred.

Budgetary Accounting: Budgetary accounting is used for management control of all funds of the City. Annual budget ordinances are adopted on the modified accrual basis at the fund level and amended as required for the operations of the general, debt service, certain special revenue, and proprietary funds. Because the proprietary funds are accounted for and budgeted for using different bases of accounting, the following differences are inherent in the financial statements and the budget ordinances:

• Capital Outlays – According to generally accepted accounting principles (GAAP), capital outlays are notreflected in the operating statements of proprietary funds, because the purchase of a capital item doesnot affect the fund's economic resources. This is because a proprietary fund is not economically better orworse off when one asset (cash) is exchanged for another asset (equipment). Because the budget isadopted using modified accrual for all funds, including proprietary funds, the budget treats capital outlayacquisition as an "expenditure" regardless of the fund.

• Debt Service Principal Payments – In the financial statements, proprietary funds do not report paymentsof debt service principal in their operating statements. These funds are not considered to be worse offeconomically when both debt and assets are reduced by the same amount. Because the budget isprepared using the modified accrual basis of accounting, the budget ordinances include debt serviceprincipal payments for proprietary funds.

15

FUND SUMMARIES

• Depreciation – Depreciation allocates the cost of fixed assets to the periods that benefit from the use ofthose assets. According to generally accepted accounting principles (GAAP), proprietary funds usedepreciation accounting and report depreciation in their operating statements. This accounting reflectsthe fact that these funds are economically worse off as their assets are consumed. Budgetary accounting,on the other hand, does not use depreciation accounting because the financial effect of the purchase ofa capital item occurs when it is purchased, not when it is consumed.

FUND ACCOUNTING SUMMARY

Fund Type Fund Category Basis of Accounting Budgetary Accounting

General Fund Governmental Modified Accrual Modified Accrual

Special Revenue Governmental Modified Accrual Modified Accrual

Debt Service Governmental Modified Accrual Modified Accrual

Capital Projects Governmental Modified Accrual Modified Accrual

Enterprise Proprietary Full Accrual Modified Accrual

Internal Service Proprietary Full Accrual Modified Accrual

Fiduciary Fiduciary Full Accrual Modified Accrual

16

NET EXPENDITURES BY FUND

TOTAL NET EXPENDITURES BY FUND

Net Total: $532.2 Million

Budget Adopted Percent Transfers and Net Operating Expenditures FY 20-21 FY 21-22 Change Interfund Charges Expenditures General Fund $214,131,280 $223,072,220 4.2% -$20,743,540 $202,328,680 Internal Service Funds 90,540,200 90,987,730 0.5% -80,634,410 10,353,320 Special Revenue Funds 26,088,190 23,058,500 -11.6% -$8,262,390 $14,796,110 Enterprise Funds 149,556,340 151,866,930 1.5% -6,033,320 145,833,610 Subtotal $480,316,010 $488,985,380 1.8% -$115,673,660 $373,311,720

Debt and Lease Debt Service Fund $39,016,600 $36,337,390 -6.9% -$2,491,840 $33,845,550 Equipment Leasing Fund 12,163,960 7,019,620 -42.3% -454,670 6,564,950 Subtotal $51,180,560 $43,357,010 -15.3% -$2,946,510 $40,410,500

Capital Expenditures Capital Projects Fund $2,975,530 $15,366,850 416.4% $0 $15,366,850 Enterprise Capital Projects 43,778,910 81,609,720 86.4% 0 81,609,720 Capital Equipment Acquisition 5,863,240 13,104,190 123.5% 0 13,104,190 Subtotal $52,617,680 $110,080,760 109.2% $0 $110,080,760

Fiduciary Funds Post-Employment Benefit Fund $9,958,600 $9,981,280 0.2% -$1,536,470 $8,444,810

Total Expenditures $594,072,850 $652,404,430 9.8% -$120,156,640 $532,247,790

1.6%

1.9%

2.8%

7.6%

20.7%

27.4%

38.0%

Employee Benefits Fund

Internal Service Funds

Special Revenue Funds

Debt and Lease Funds

Capital Funds

Enterprise Funds

General Fund

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

17

GENERAL FUND EXPENDITURES BY TYPE

GENERAL FUND EXPENDITURES BY TYPE

Total $223.1 Million

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Personnel $152,777,545 $150,000,930 $153,669,320 2.4% Supplies and Services 43,888,002 49,671,520 52,264,050 5.2% Leasing/Capital Outlay 6,891,462 7,408,120 7,495,720 1.2% Support to Other Funds 6,313,117 7,050,710 9,643,130 36.8% Total $209,870,126 $214,131,280 $223,072,220 4.2%

4.3%

3.4%

23.4%

68.9%

Support to Other Funds

Leasing/Capital Outlay

Supplies and Services

Personnel

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0%

18

GENERAL FUND EXPENDITURES BY SERVICE AREA



Actual Budget Adopted Percent Community and Economic Development FY 19-20 FY 20-21 FY 21-22 Change Planning and Development Services $6,781,419 $6,863,130 $7,042,410 2.6% Community Development 5,089,286 5,928,620 6,164,110 4.0% Business Inclusion and Advancement 726,582 838,420 835,350 -0.4% Community Agencies 808,113 726,800 728,450 0.2% Non-Departmental Support

MapForsyth Geographic Information Office 203,524 212,490 228,040 7.3% Housing Repayment 196,510 196,510 196,510 0% Housing Finance Assistance Fund 103,000 87,050 87,340 0.3% Economic Development Loan Fund 0 0 183,350 N/A Economic Development Projects Fund 2,897,310 3,037,580 2,955,630 -2.7% Grants Fund -1,875 0 0 N/A

Subtotal $16,803,867 $17,890,600 $18,421,190 3.0% Environmental Health Sanitation $17,615,917 $16,834,340 $17,107,290 1.6% Sustainability 2,011,165 2,115,210 2,393,790 13.2% Less Interdepartmental Charges -74,910 -102,780 -102,780 0% Subtotal $19,552,172 $18,846,770 $19,398,300 2.9%

1.2%

3.8%

4.3%

6.9%

7.0%

7.4%

8.3%

8.7%

52.3%

Human Resource Management

Fiscal Management

General Government

Recreation & Culture

Transportation

Interdepartmental Services

Community & Economic Development

Environmental Health

Public Safety

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%

19


Actual Budget Adopted Percent Public Safety FY 19-20 FY 20-21 FY 21-22 Change Police Department $76,772,748 $77,324,970 $79,093,120 2.3% Fire Department 35,838,811 33,892,990 35,549,510 4.9% Emergency Management 633,991 654,390 681,470 4.1% Community Agencies 45,000 45,000 45,000 0% Non-Departmental Support Grants Fund 637,981 492,190 1,347,530 173.8% Subtotal $113,928,530 $112,409,540 $116,716,630 3.8% Transportation

Department of Transportation $7,721,820 $9,028,080 $9,111,450 0.9% Traffic Field Operations 4,255,622 5,824,180 5,568,410 -4.4% Non-Departmental Support

Grants Fund 199,297 216,570 272,670 25.9% Parking Fund 0 0 744,550 N/A

Less Interdepartmental Charges 0 -30,000 0 -100.0% Subtotal $12,176,739 $15,038,830 $15,697,080 4.4% Recreation and Culture Recreation and Parks $11,539,647 $12,867,960 $13,143,310 2.1% Community Agencies 49,500 66,000 66,000 0% Non-Departmental Support

Convention Center Fund 541,690 979,970 1,118,580 14.1% Winston-Salem Fairgrounds Fund 0 0 1,045,370 N/A

Subtotal $12,130,837 $13,913,930 $15,373,260 10.5% Fiscal Management Financial Management Services $5,988,236 $6,864,500 $7,047,460 2.7%

Budget and Evaluation 611,313 610,380 587,920 -3.7%

Claims for Damages 727,605 747,810 927,000 24.0%

Subtotal $7,327,154 $8,222,690 $8,562,380 4.1% Human Resources Management Human Resources $2,338,031 $2,711,110 $2,784,740 2.7%

Subtotal $2,338,031 $2,711,110 $2,784,740 2.7% Interdepartmental Services Operations $1,111,995 $1,233,660 $1,564,320 26.8%

Engineering 3,520,017 3,973,850 3,966,640 -0.2%

Property and Facilities Management 13,372,381 15,213,620 15,924,440 4.7%

Mail and Printing Services 691,983 772,960 795,250 0.2%

Information Systems 821,102 932,260 947,260 1.6%

Non-Departmental Support

Cemetery Perpetual Care Fund 11,145 0 0 N/A

Debt Service Fund 1,137,360 1,119,400 1,097,680 -1.9%

Less Interdepartmental Charges -6,435,501 -7,219,370 -7,677,640 6.3%

Subtotal $14,230,482 $16,026,380 $16,617,950 3.7%

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Actual Budget Adopted Percent General Government FY 19-20 FY 20-21 FY 21-22 Change Policy Leadership $2,413,715 $2,482,210 $2,515,160 1.3% Office of Community Assistance 731,269 759,920 810,070 6.6%

City Manager 1,650,601 1,595,440 1,612,690 1.1%

Strategic Initiatives 0 128,990 131,090 1.6%

Diversity, Equity and Inclusion 0 0 503,310 N/A

Office of Performance and Accountability 652,601 703,880 725,310 3.0%

City Link 1,970,481 2,153,870 2,203,160 2.3%

City Clerk 404,771 450,280 466,580 3.6%

Marketing and Communications 1,553,266 1,493,230 1,505,760 0.8%

Human Relations 507,857 532,970 553,960 3.9%

Non-Departmental Support Property Tax Collection 710,542 719,840 750,320 4.2%

Salary Savings Adjustment 0 -3,067,150 -3,067,150 0%

Debt Service Fund 788,520 790,830 790,430 -0.1%

Capital Projects Fund 0 327,120 0 -100.0%

Grants Fund -1,312 0 0 N/A

Subtotal $11,382,312 $9,071,430 $9,500,690 4.7%

Total General Fund Expenditures By Service Area $209,870,126 $214,131,280 $223,072,220 4.2%

21

GENERAL FUND RESOURCES BY TYPE



Actual Budget Adopted Percent Taxes FY 19-20 FY 20-21 FY 21-22 Change Property Taxes – Current Year $109,296,313 $110,634,120 $121,448,370 9.8% Property Taxes – Prior Year 668,109 850,000 850,000 0% Sales Taxes 40,080,787 34,990,090 44,131,910 26.1% Gross Receipts Tax 379,659 360,000 360,000 0% Subtotal $150,424,868 $146,834,210 $166,790,280 13.6% Licenses and Permits Construction Permits $3,958,669 $3,789,970 $3,989,850 5.3% Privilege Licenses 11,840 11,000 8,000 -27.3% Motor Vehicle License Taxes 1,806,694 1,773,230 1,806,690 1.9% Other Licenses and Permits 325,317 247,060 231,240 -6.4% Subtotal $6,102,520 $5,821,260 $6,035,780 3.7% Intergovernmental Resources State-Collected Local Revenues

Utility Franchise Tax $18,373,688 $18,649,770 $17,322,910 -7.1% Beer and Wine Tax 1,047,080 1,040,140 1,047,080 0.7% Gasoline Tax 3,788,283 5,146,100 5,146,100 0%

Other Intergovernmental Resources ABC Allocation 1,900,376 1,622,930 1,813,880 11.8% Housing Authority Payment in Lieu of Taxes 127,461 103,000 103,000 0% Other State Resources 643,470 177,200 177,200 0%

Subtotal $25,880,357 $26,739,140 $25,610,170 -4.2%

0.4%

0.6%

0.7%

1.5%

2.7%

7.9%

11.5%

19.9%

54.8%

Civil Penalties

Fund Balance Appropriation

Other Resources

Transfers from Other Funds

Licenses & Permits

Charges for Services

Intergovernmental Resources

Sales Taxes

Property Taxes

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%

22


Actual Budget Adopted Percent Charges for Services FY 19-20 FY 20-21 FY 21-22 Change Governmental Sales and Service $2,650,318 $2,690,600 $2,759,190 2.5% Parking Meter Revenue 97,348 110,000 110,000 0% Charges to the State 654,324 699,760 699,760 0% Charges to Forsyth County 2,317,386 2,724,160 2,933,110 7.7% Charges to Other Municipalities 22,991 24,000 28,000 16.7% Interfund Charges 11,492,484 11,632,740 11,100,410 -4.6% Subtotal $17,234,851 $17,881,260 $17,630,470 -1.4% Civil Penalties Parking Tickets $204,843 $220,500 $150,500 -31.7% Housing Code Violations 514,483 603,200 603,200 0% Zoning Violation Fines -4,762 24,500 24,500 0% False Alarm Civil Penalties 120,451 101,000 108,000 6.9% Subtotal $835,015 $949,200 $886,200 -6.6% Other Resources Rentals $350,434 $470,330 $456,700 -2.9% Sales of Property and Equipment 560,634 310,000 310,000 0% Contributions 559,733 947,900 235,320 -75.2% Reimbursements 1,970,460 1,366,200 78,000 -94.3% Miscellaneous 378,930 270,470 410,710 51.9% Subtotal $3,820,191 $3,364,900 $1,490,730 -55.7% Transfers from Other Funds Home Investment Partnership Fund $0 $80,000 $80,000 0% Community Development Block Grant Fund 855,971 916,450 903,840 -1.4% Grants Fund 24,863 0 0 N/A Housing Finance Assistance Fund 0 0 65,000 N/A Economic Development Loan Fund 0 4,000,000 0 -100.0% Leasing Fund 9,180 37,730 93,900 148.9% Cemetery Perpetual Care Fund 203,446 0 0 N/A Water and Sewer Fund 78,073 85,670 87,380 2.0% Stormwater Management Fund 1,869,123 1,866,830 1,924,170 3.1% Worker’s Compensation Fund 121,020 124,630 124,300 -0.3% Subtotal $3,161,675 $7,111,310 $3,278,590 -53.9%

Fund Balance Appropriation $0 $5,430,000 $1,350,000 -75.1%

Total Resources by Type $207,459,477 $214,131,280 $223,072,220 4.2%

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GENERAL FUND SUMMARY

The general fund, the principal operating fund for the City, accounts for the expenditures and resources needed to provide municipal services such as police, fire, sanitation, streets, and recreation, which are supported by general purpose revenues such as property tax, sales tax, licenses, permit fees, charges for service, intergovernmental revenue, and other miscellaneous resources. Overall, the general fund budget compared to the FY 2020-21 budget is increased 4.2% for recurring expenditures. The adopted budget for the general fund is balanced with a 46.34 cent property tax rate.

Highlights of year-to-year changes in the general fund budget, by expenditure and revenue category, are provided immediately following the summary table, below.

GENERAL FUND EXPENDITURES AND RESOURCES BY ACCOUNT TYPE

Actual FY 19-20

Budget FY 20-21

Estimated FY 20-21

Adopted FY 21-22

Adopted-Budget

$ Change

Adopted-Budget

% Change Revenues Property Taxes $109,964,422 $111,484,120 $111,837,196 $122,298,370 $10,814,250 9.7% Sales and Gross Receipts Taxes 40,460,446 35,350,090 43,197,338 44,491,910 9,141,820 25.9% Licenses and Permits 6,102,520 5,821,260 6,171,483 6,035,780 214,520 3.7% Intergovernmental 25,880,357 26,739,140 25,940,479 25,610,170 (1,128,970) -4.2%Charges for Services/Other 21,890,057 22,195,360 20,564,107 20,007,400 (2,187,960) -9.9%Transfers from Other Funds 3,161,675 7,111,310 7,092,054 3,278,590 (3,832,720) -53.9%

Total Revenues $207,459,477 $208,701,280 $214,802,657 $221,722,220 $13,020,940 6.2%

Recurring Expenditures Personnel $152,777,545 $150,000,930 $149,013,513 $153,669,320 $3,668,390 2.4% Supplies and Services 43,888,002 49,671,520 44,653,190 52,264,050 2,592,530 5.2% Capital Outlay 6,891,462 7,408,120 6,815,648 7,495,720 87,600 1.2% Support to Other Funds 6,313,117 7,050,710 8,825,397 9,643,130 2,592,420 36.8% Subtotal $209,870,126 $214,131,280 $209,307,748 $223,072,220 $8,940,940 4.2%

One-Time Expenditures $0 $0 $0 $0 $0 N/A

Total Expenditures $209,870,126 $214,131,280 $209,307,748 $223,072,220 $8,940,940 4.2%

One-time Use of Fund Balance $0 $0 $0 ($1,350,000) ($1,350,000) N/A Recurring Use of Fund Balance (2,410,649) (5,430,000) 0 0 5,430,000 -100.0%Addition to Fund Balance 0 0 5,494,909 0 0 N/A

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EXPENDITURE HIGHLIGHTS

Personnel. The $3,668,390 budget-to-budget growth in personnel expenditures for FY 2021-22 is primarily due to the following adjustments:

• Employee Merit Pay Adjustment. The adopted budget includes a tiered merit pay increase in whichemployees would receive increases based on performance ratings, according to the following scale: topperformers – 3.5%, strong performers – 2.5%, and solid performers – 2.0%. The total budget increase is$2.6 million including benefits.

• Minimum Wage Increase. The adopted budget includes an increase in the minimum hourly rate of payfor city employees to $15.00 per hour. The total general fund cost for salary and benefits is $359,730.

• Police and Fire Supplemental Pay. The adopted budget includes an increase of $713,320 for police andfire supplemental pay. In February 2016, the Mayor and City Council approved increasing minimumsalaries and a 2% annual supplement for sworn police and certified fire personnel. An additional 2%supplement was approved as part of the FY 2016-17, FY 2017-18, FY 2018-19, and FY 2019-20 budgets,effective on January 1 of each fiscal year. The supplement for FY 2021-22 would become effective onJanuary 1, 2022.

• Increases to Employee Benefits. The adopted budget includes an additional $873,750 in employee benefit expenses. This is due to increases in the City’s contribution to the North Carolina Local GovernmentEmployee Retirement System and the Law Enforcement Officer Retirement System, as well as increasesfor the Winston-Salem Police Officers Retirement System.

• Position Changes. The adopted budget includes the addition of the following five full-time positions:

o The addition of four positions for the Office of Diversity, Equity, and Inclusion to include a Director, an Equity Assurance Administrator, an Equity and Inclusion Coordinator, and an AdministrativeAssistant. The cost of these positions, including benefits, is $375,110.

o The addition of one fire inspector in the Fire Prevention Bureau. Several years ago, the FireDepartment created a three-year plan, in which one inspector position would be added each yearfor three years. After three years, all fire inspections would be handled by the Fire PreventionBureau. The cost of the final fire inspector position, including benefits, is $103,630.

• Base Salary Changes. The adopted budget reflects a reduction in base salaries of approximately $1.6million due to retirements and attrition (including benefits).

Supplies and Services. There is a net increase of $2,592,530 in non-personnel operating expenditures due to the following:

• Leased Lines. Leased lines are increased $189,970. The majority ($175,000) is for Police Communicationsfor AT&T phone lines connecting dispatch to the individual fire stations. The increase represents thesignificant continuous increases in these bills, which are not eligible for E911 funds.

25


• Contractual Services. The adopted budget includes an increase of $997,060 for contractual needs.Services included with these contracts include body cameras and tasers for the Police Department,recycling services, added security at the City’s Lowery Street facility, new contracts in the Office ofDiversity, Equity, and Inclusion, and SNAP/EBT services for the Liberty Street Farmer’s Market.

• Information Systems Charges. Information systems charges are increased $331,340 for FY 2021-22. Thisincrease is driven by additional infrastructure and network needs, costs associated with new applicationsand services, and cybersecurity improvements.

• Successful Outcomes After Release Work Experience Program. The adopted budget includes $300,000to double the number of participants in the SOAR work experience program. The budget for this programis included in Operations under Reintegration and Youth Development.

Capital Outlay. Capital outlay expenditures reflect a net increase of $87,600 as a result of the final payment in FY 2020-21 for previously approved items and the addition of $2,618,850 in lease payments for equipment replacements. A complete list of all equipment adopted for FY 2021-22 is provided in the Supplemental Information section of this document.

Support to Other Funds. General fund support to other funds is increased $2,592,420 as a result of the following:

• The general fund subsidy for The Benton, which covers a portion of the operating deficit and managementfee for the facility, is increased by $138,610, due to the impact on events from the COVID-19 pandemic.

• The adopted budget includes a net decrease in the transfer to the economic development project fundfor scheduled economic development incentive payments (-$81,950).

• The adopted budget includes the reinstatement of a subsidy for the off-street parking fund totaling$744,550. There was no subsidy budgeted in the FY 2020-21 budget.

• Due to the Covid-19 pandemic and the cancellation of the Carolina Classic Fair during FY 2020-21, theadopted budget for FY 2021-22 includes the addition of a subsidy to the fairgrounds totaling $1,045,370.

• The adopted budget includes a transfer of $183,350 to the economic development loan fund for the DriverRestoration Initiative and Vocational Expansion (DRIVE) program.

• The adopted budget includes a transfer of $1,050,000 to the grants fund for a portion of the crimeprevention plan including: crime prevention programs and conflict resolution for youth ($250,000), CUREprogram/ violence interrupters ($200,000), recreation center programming and mentorship stipends inhigh-crime areas ($200,000), gun buy-back program ($50,000), and Pre-K initiatives ($350,000).

REVENUE HIGHLIGHTS

Property Taxes. Property taxes are the largest single source of revenue for the City, accounting for 54.8% of all general fund resources (including transfers from other funds and the fund balance appropriation). The following sections describe in detail the City’s projected property tax base, the calculation of the adopted FY 2021-22 tax rate, and projected property tax revenues.

The adopted tax rate for FY 2021-22 is 61.24¢, which represents a 2.5¢ decrease from FY 2020-21. The adopted rate for the general fund decreases to 46.34¢.

26


• Property Tax Base. The property tax base consists of real property, personal property, registered motor vehicles, and state-assessed public services property. The real portion of the property tax base includes land and building values for all commercial, industrial, residential, and other real property. State law requires that real property be reappraised at least once every eight years. In Forsyth County, reappraisals are scheduled every four years. The Forsyth County Tax Office has completed the 2021 reappraisal, which went into effect January 2021. Overall, the property tax base is projected to increase by 12.3%. The Forsyth County Tax Office’s tax base estimate for FY 2021-22 is provided in the table below:

Tax Base by Type FY 20-21

Budgeted FY 20-21

Estimated FY 21-22

Projected Est. to Proj.

% Change Real Property $18,262,138,092 $18,305,471,498 $20,874,445,474 14.0% Personal Property 2,454,724,927 2,531,735,493 2,659,533,779 5.0% Reg. Motor Vehicles 1,955,773,862 2,001,510,665 2,167,536,786 8.3% Public Services 430,831,720 433,966,956 433,966,956 0% Total $23,103,468,601 $23,272,684,612 $26,135,482,995 12.3%

ANNUAL PROPERTY TAX BASE VALUE

• Property Tax Rate Distribution. The property tax rate of 61.24₵ per $100 of valuation is levied on all taxable property and is distributed to three funds – general fund, debt service fund, and the Winston-Salem Transit Authority fund. The adopted revenue for FY 2021-22 is distributed to these funds, as follows: 46.34¢ to the general fund, 10.04¢ to the debt service fund, and 4.86¢ to the Winston-Salem Transit Authority fund. The following table provides the current rate distribution and the adopted rate distribution along with the revenue impact.

Current Rate

Adopted Rate

Rate Change

Revenue Change

General Fund 47.46₵ 46.34₵ -1.12₵ $10,814,250 Debt Service Fund 11.30₵ 10.04₵ -1.26₵ $55,340 Winston-Salem Transit Authority Fund 4.98₵ 4.86₵ -0.12₵ $1,163,630 Total Tax Rate 63.74₵ 61.24₵ 2.50₵ $12,033,220

$22.38 $22.96 $23.27

$26.14

$0.0

$5.0

$10.0

$15.0

$20.0

$25.0

$30.0

FY 2019 FY 2020 FY 2021 Est. FY 2022 Proj.

Billi

ons

27

GENERAL FUND SUMMARY Sales Taxes. The City receives four sales tax allocations: Article 39 one-cent tax, which is the original local government sales and use tax dating from 1971; Article 40 half-cent sales tax, which was authorized in 1983 (with 20% currently allocated to the general fund and the remaining 80% allocated to the debt service fund); Article 42 half-cent tax, which was authorized in 1986; and a “city hold harmless” payment to compensate for the loss of Article 44, which was eliminated in full as of October 1, 2009. Article 39 revenue is collected by the state and distributed to the county based on “point of delivery” (where the taxed item is delivered for use by the purchaser). Revenue from Article 40 is collected by the state and distributed to each county based upon its share of statewide population. Beginning July 1, 2009, the distribution basis for revenue from Article 42 was changed from “per capita” to “point of delivery.” Sales tax in Forsyth County is distributed based on the ad valorem method. This method allocates sales tax proportionally among the county and municipalities based on the amount of property taxes levied in the jurisdictions in the previous fiscal year. A change in a jurisdiction’s tax rate in the previous fiscal year can result in a change in their proportion of sales tax received the following year. The City’s sales tax revenue is allocated to the general fund and the debt service fund, as shown below:

SALES TAX REVENUE ALLOCATION BY ARTICLE

General Fund FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21

(estimated) FY 21-22

(projected) Article 39 $17,646,545 $18,467,659 $19,685,116 $20,627,418 $22,048,992 $22,801,280 20% of Article 40 1,500,467 1,615,719 1,708,815 1,812,435 1,955,976 2,022,460 Article 42 8,509,197 8,894,945 9,486,604 9,912,020 10,582,485 10,943,540 Article 44/”Hold Harmless” 6,325,680 6,929,420 7,299,364 7,728,914 8,293,294 8,364,630 Subtotal $33,981,889 $35,907,743 $38,179,899 $40,080,787 $42,880,748 $44,131,910 Debt Service Fund 80% of Article 40 $6,001,869 $6,462,876 $6,835,260 $7,249,740 $7,825,620 $8,089,860 Total $39,983,759 $42,370,619 $45,015,159 $47,330,527 $50,706,368 $52,221,770

• Sales Tax Revenue Projection for FY 2021-22. Sales tax collections for the general fund are projected to

increase $9.14 million budget-to-budget, or 26.1%, based on projected 2.5% growth in sales tax distributions. The City’s ad valorem distribution is projected to increase slightly from 31.65% to 31.86%.

HISTORICAL TREND IN SALES TAX REVENUE (ALL FUNDS)

$35.4 $37.6 $40.0$42.4

$45.0 $47.3$50.7 $52.2

$0.0

$10.0

$20.0

$30.0

$40.0

$50.0

$60.0

FY 15 FY 16 FY 17 FY 18 FY 19 FY 20 FY 21 Est. FY 22 Proj.

Mill

ions

28

GENERAL FUND SUMMARY Licenses and Permits.

• Construction Control and Zoning Enforcement Permits. The adopted budget includes a 3.7% increase in licenses and permits ($214,520). Construction permits are increased by $199,880, based on an expected increase in permit activity after the impacts of the COVID-19 pandemic in the current fiscal year.

• Motor Vehicle Privilege Tax. There is a $15 fee charged for each registered motor vehicle. The general fund receives revenue from $10 of the fee, and the remaining revenue from $5 per vehicle (authorized in February 2006) is appropriated in the capital projects and Winston-Salem Transit Authority funds with one-third allocated for transit operations, one-third for non-vehicular transportation projects (such as greenway and sidewalk development), and one-third for vehicular transportation projects (such as traffic calming and other traffic safety projects). The general fund portion of the motor vehicle privilege license fee revenue is projected at approximately $1.8 million.

Intergovernmental Revenue.

• Utility Franchise Tax. The utility franchise tax is collected by the State, based on a share of the receipts from regional electric, natural gas, telecommunications, and video programming companies. For FY 2021-22, the share of this revenue that is distributed to the City is expected to decrease by $1,326,860 compared to the FY 2020-21 budget, based on FY 2020-21 actual receipts to date.

HISTORICAL TREND IN ANNUAL UTILITY FRANCHISE TAX RECEIPTS

$3.6 $3.8 $3.8 $4.1$4.5

$4.0 $4.1 $4.0

$0.0

$1.0

$2.0

$3.0

$4.0

$5.0


Mill

ions

Construction Permit Revenues All Trades (City and County)

$17.2$18.6 $18.1 $18.3 $18.9 $18.4

$17.5 $17.3

$0.0$2.0$4.0$6.0$8.0

$10.0$12.0$14.0$16.0$18.0$20.0


Mill

ions

29


• Beer and Wine. State law provides for the per capita distribution of state beer and wine receipts to the local governmental units in which beer and wine are legally sold. Beer and wine revenues are projected to remain fairly level, with an increase of 0.7%.

• Gasoline Tax (Powell Bill). Powell Bill revenue for FY 2021-22 is projected at $5,800,790, a 7.7% decrease compared to the FY 2020-21 budget, based on a formula for revenue distribution used by the N.C. Department of Transportation, with 75% of the distribution calculated at $17.48 per capita and 25% at $1,458.01 per municipal street mile. For FY 2021-22, $1,137,450 of the Powell Bill revenue is to be allocated to the capital projects fund for street resurfacing (in addition to $482,760 in reserves). The remaining $5,146,100 in revenue is transferred to the general fund for eligible transportation-related expenses.

HISTORICAL TREND IN ANNUAL GASOLINE TAX REVENUE

Charges for Services and Other Revenues. Charges for services include user fees for sanitation, recreation, police, transportation, housing, planning, and other City services, as well as charges to the county and state for services the City agrees to provide for state and county benefit. Also included in this category are interfund revenues, which represent payments from one fund to another for services rendered. Other revenues include contributions, reimbursements, sale of property, property rentals, and fines. For FY 2021-22, there is a net decrease of $2,187,960 compared to FY 2020-21 budgeted service charge revenue. The adopted budget includes a $1,288,200 reduction in reimbursements from the Winston-Salem/Forsyth County School System for the phase out of the City of Winston-Salem’s Police Department participation in the School Resource Officer (SRO) program. This reduction is partially offset by the elimination of 10 vacant police officer positions as part of the phase out, effective July 1, 2021. The FY 2020-21 budget for yard waste carts was reduced to account for refunds to customers due to the temporary halting of service during the COVID-19 pandemic. The adopted FY 2021-22 budget for yard waste cart revenues is increased $110,500 to reflect pre-pandemic revenues. Interfund charges are reduced by $532,330, bringing the budgeted revenue in line with recent trends. Transfers from Other Funds. Transfers from other City funds represent support to the general fund for various purposes, such as housing rehabilitation, risk management services for Utilities, seasonal leaf collection, and pest control. For FY 2021-22, transfers are reduced $3,832,720, or 53.9%, compared to the FY 2020-21 budget. This includes the removal of a one-time transfer in FY 2020-21 from the economic development loan fund of $4,000,000 in proceeds from the sale of the Nissen Building in downtown Winston-Salem.

$6.5 $6.5 $6.5 $6.5 $6.4 $6.4 $6.1 $5.8

$4.8$5.1 $5.3 $5.4

$4.8

$3.8

$4.6$5.1

$0.0

$1.0

$2.0

$3.0

$4.0

$5.0

$6.0

$7.0


Mill

ions

All Funds General Fund

30

GENERAL FUND BALANCE HIGHLIGHTS Fund Balance Appropriation for FY 2021-22: The adopted budget includes a fund balance appropriation of 1,350,000 for FY 2021-22. 14.0% Fund Balance Reserve Policy: The North Carolina Local Government Commission (LGC) recommends that all units of government maintain a minimum fund balance in their operating funds of 8% of budgeted expenditures. The City of Winston-Salem’s policy is to maintain a minimum fund balance reserve in the general fund that is equivalent to 14.0% of budgeted expenditures. By meeting this standard, the City is able to maintain adequate working capital and to produce investment income for debt retirement. For FY 2021-22, the 14.0% requirement totals $31.23 million. General Fund Balance Analysis: The graph below illustrates the estimated change in general fund balance at June 30, 2020. The portion of the fund balance restricted by state statute is unchanged and the amount appropriated for FY 2021-22 brings the amount of fund balance reserved by policy to about 14.0%. Overall, general fund balance is estimated to increase to $54.6 million.

GENERAL FUND BALANCE AT JUNE 30, 2021 COMPARED TO JUNE 30, 2020

Note: The restricted portion of the fund balance mainly represents the anticipated receipt of federal revenues and sales tax.

$22.1 MRestricted

$22.1 MRestricted

$21.6 Mfor 10.1% Reserve

$31.1 Mfor 14.0% Reserve

$5.4 M Appropriated

$1.4 M Appropriated

$0

$10

$20

$30

$40

$50

$60

June 30, 2020 Actual June 30, 2021 Estimated

Mill

ions

$49.1 M

$54.6 M

31

INTERNAL SERVICE FUNDS Internal service funds provide centralized services to the various departments and agencies of the City or to other governments. These services are categorized in the interest of efficiency and economy and are self-supporting through charges to the users. Included in the internal service funds are Central Warehouse, Fleet Services, Information Systems, and Employee Benefit Funds (except the Retiree Life and Health Fund). Program descriptions and expenditure and resource details for Fleet Services, Information Systems, Central Warehouse, and Employee Benefits funds are located in the Service Excellence section of this document.

Actual Budget Adopted Percent EXPENDITURES BY FUND FY 19-20 FY 20-21 FY 21-22 Change Fleet Services $9,119,877 $10,038,760 $10,299,450 2.6% Information Systems 10,143,098 12,892,970 13,612,250 5.6% Central Warehouse 452,285 428,130 472,180 10.3% Worker’s Compensation Fund 2,863,213 4,761,930 3,816,360 -19.9% Employee Health Benefits Fund 22,289,169 25,776,620 25,684,790 -0.4% Dental and Flex Spending Fund 1,891,122 2,286,080 2,296,080 0.4% Employee Taxes and Benefits Fund 29,645,597 34,355,710 34,806,620 1.3% Total Expenditures by Fund $76,404,361 $90,540,200 $90,987,730 0.5% RESOURCES BY TYPE Charges to Departments $18,563,104 $23,359,860 $24,383,880 4.4% City Contribution 53,964,345 57,502,970 55,917,230 -2.8% Employee Contribution 7,740,004 7,650,200 7,867,000 2.8% Other Agency Contributions 236,193 210,780 215,000 2.0% Discounts Earned 1,511,912 800,000 450,000 -43.8% Reimbursements 100,548 145,000 75,000 -48.3% Investment Income 589,896 0 0 N/A Other Revenues 520,115 913,250 390,350 -57.3% Fund Balance Appropriation 0 0 1,689,270 N/A Total Resources by Type $83,226,117 $90,582,060 $90,987,730 0.5% Addition to Fund Balance $6,821,756 $41,860 $0 -100.0%

32

DEBT SERVICE FUND This fund accounts for the City’s debt service expenditures, including the City's general governmental debt obligations; certificates of participation (COPS); limited obligation bonds (LOBs); and leasing debt payments for City Hall renovations and selected recreation equipment and facility repairs. This fund also includes the administrative expenses associated with bond ratings and issuances.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Principal Retirement $18,993,596 $24,369,150 $23,345,090 -4.2% Interest Payments 11,507,823 13,766,520 11,745,750 -14.7% Fiscal Charges 524,217 246,970 142,000 -42.5% Administrative Expenses 51,572 56,400 56,560 0.3% Payments to Forsyth County 0 437,500 343,400 -21.5% Property Tax Collection Fee 169,177 140,060 172,220 23.0% Transfer to Leasing Capital Projects Fund 2,065,000 0 0 N/A Transfer to Downtown Ballpark Fund 0 0 532,370 N/A Total Expenditures by Type $33,311,385 $39,016,600 $36,337,390 23.6% RESOURCES BY TYPE Property Taxes $24,465,605 $24,737,890 $24,793,230 0.2% Sales Taxes 7,249,740 6,356,720 8,089,860 27.3% ABC Allocation 950,188 775,480 906,940 17.0% Interest Income 1,519,383 600,000 600,000 0% Interest Subsidy on Recovery Zone Bonds 221,398 0 0 N/A Forsyth County 225,809 226,000 226,000 0% Other Revenues 2,594,967 2,562,690 1,959,470 -23.5% Transfers from General Fund:

Debt Service on Dell Project 400,000 400,000 400,000 0% Lease Payment for Convention Center Capital 200,000 200,000 200,000 0% City’s Share of Debt Service on Wake Forest

Innovation Quarter Infrastructure 188,520 190,830 190,430 -0.2%

Debt Service on Bryce A. Stuart Building 1,137,360 1,119,400 1,097,680 -1.9% Transfer from Leasing Capital Projects Fund 2,065,000 0 0 N/A Fund Balance Appropriation 0 1,847,590 0 -100.0% Total Resources by Type $41,217,970 $39,016,600 $38,463,610 1.4% Addition to Fund Balance $7,906,585 $0 $2,126,220 N/A

33

SPECIAL REVENUE FUNDS DETAILED BY FUND

COMMUNITY DEVELOPMENT BLOCK GRANT FUND

This fund accounts for authorized grants from the U.S. Department of Housing and Urban Development. These revenues are restricted to objectives of community development programs within specific areas of the City.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Loans $568,539 $454,170 $467,480 2.9% Contractual Services and Other Expenses 346,921 877,350 350,350 -60.1% Indirect Cost Allocation 40,010 40,010 40,010 0% Contingencies 0 70,310 20,000 -71.6% Grants 291,990 250,000 180,000 -28.0% Section 108 Loan Principal and Interest Payments 379,512 0 0 N/A Loan Servicing Expenditures 50,619 53,000 100,000 88.7% Transfer to General Fund (Administration) 166,260 176,920 206,350 16.6% Transfer to General Fund (Program Activities) 689,711 739,530 697,490 -5.7% Transfer to Capital Projects Fund (CNI) 0 0 500,000 N/A

Total Expenditures by Type $2,533,561 $2,661,290 $2,561,680 -3.7% RESOURCES BY TYPE Federal Grants $1,996,279 $2,211,290 $2,136,680 -3.4% Loan Repayments 451,484 450,000 425,000 -5.6% Sale of Real Estate 77,352 0 0 N/A Miscellaneous Revenues 8,447 0 0 N/A

Total Resources by Type $2,533,561 $2,661,290 $2,561,680 -3.7%

HOUSING FINANCE ASSISTANCE FUND

This fund accounts for general purpose revenues allocated to the City’s housing programs.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Loans $94,028 $96,000 $96,000 0% Contractual Services and Other Expenses 919,793 456,000 227,770 -50.1% Grants 14,873 8,300 8,300 0% Contingencies 0 10,000 10,000 0% Re-Grant of Housing Authority’s PILOT Funds 172,558 147,500 147,790 0.2% Transfer to General Fund 0 0 65,000 N/A

Total Expenditures by Type $1,201,252 $717,800 $554,860 -22.7%

34


HOUSING FINANCE ASSISTANCE FUND - Continued

Actual Budget Adopted Percent RESOURCES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Loan Repayments $551,420 $562,000 $398,770 -29.0% Investment Income 58,478 8,300 8,300 0% Sale of Real Estate 5,000 0 0 N/A Miscellaneous Revenues 1,227 0 0 N/A Transfer from General Fund 103,000 87,050 87,340 0.3% Fund Balance Appropriation 482,126 60,450 60,450 0%

Total Resources by Type $1,201,252 $717,800 $554,860 -22.7%

HOME INVESTMENT PARTNERSHIP FUND

This fund accounts for authorized grants from the U.S. Department of Housing and Urban Development. These funds are used to expand the supply of affordable housing for low- and very low-income families.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Loans $1,471,271 $839,060 $852,240 1.6% Contractual Services and Other Expenses 439,785 478,230 488,760 2.2% Indirect Cost Allocation 19,900 19,900 19,900 0% Contingencies 14,778 41,470 42,640 2.8% Transfer to General Fund 0 80,000 80,000 0%

Total Expenditures by Type $1,945,734 $1,458,660 $1,483,540 1.7% RESOURCES BY TYPE Federal Grants $1,159,963 $1,323,660 $1,348,540 1.9% Loan Repayments 531,083 135,000 135,000 0% Miscellaneous Revenues 399 0 0 N/A


35


HOUSING OPPORTUNITIES FOR PERSONS WITH AIDS (HOPWA) FUND

HOPWA provides housing assistance and related supportive services to meet the housing needs of low-income persons and their families living with HIV/AIDS.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Contractual Services $0 $0 $710,310 N/A Total Expenditures by Type $0 $0 $710,310 N/A RESOURCES BY TYPE Federal Grants $0 $0 $710,310 N/A Total Resources by Type $0 $0 $710,310 N/A

SUPPORTIVE HOUSING GRANTS FUND

The U.S. Department of Housing and Urban Development awards these funds through a competitive application process to address comprehensive, priority needs of the homeless that are identified in a community’s Continuum of Care strategy, including rental assistance, case management, and other required supportive services. The City is the applicant and funding conduit on behalf of up to ten agencies administering multiple program services.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Continuum of Care Grants $2,117,957 $2,236,000 $2,383,000 6.6% Emergency Shelter Grant 197,134 191,620 188,590 -1.6%

Total Expenditures by Type $2,315,091 $2,427,620 $2,571,590 5.9% RESOURCES BY TYPE Federal Grants $2,060,009 $2,427,620 $2,571,590 5.9% State Grants 255,475 0 0 N/A


36


ECONOMIC DEVELOPMENT PROJECT FUND

This fund accounts for the City’s economic development incentive funds. This fund supports specific economic development programs that are designed to attract new industry or encourage the expansion of existing businesses.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Grants $2,511,227 $3,037,580 $2,955,630 -2.7% Transfer to Downtown Ballpark Capital Fund 148,500 0 0 N/A Total Expenditures by Type $2,659,727 $3,037,580 $2,955,630 -2.7%

RESOURCES BY TYPE

Transfer from General Fund $2,897,310 $3,037,580 $2,955,630 -2.7% Other Revenues 70,000 0 0 N/A


Addition to Fund Balance $307,583 $0 $0 N/A

The schedule of economic development incentive grant commitments for FY 2021-22 through FY 2024-25 is as follows:

Grantee Budget

FY 21-22 Planning FY 22-23

Planning FY 23-24

Planning FY 24-25

Brookstown Development Partners $183,850 $183,850 $183,850 $183,850 Bunzl 36,590 36,590 36,590 36,590 Caterpillar, Inc. 1,200,000 1,200,000 986,560 0 CCW Hospitality LLC 22,980 22,980 22,940 0 Clearing House 34,370 50,460 35,010 19,820 Cook Medical 0 246,430 246,430 246,430 Corning 83,730 0 0 0 GMAC/Grubbs 165,000 165,000 165,000 165,000 Merschel Plaza 100,000 100,000 100,000 100,000 Inmar 156,500 152,520 0 0 National General Insurance 59,820 55,780 79,680 0 Pepsi Bottling Ventures 127,910 127,910 56,850 0 Polyvlies 7,310 6,240 4,980 0 Renfro 19,820 19,820 13,220 13,220 WFIQ 196,240 196,240 196,240 64,280 WFIQ – Bailey Power Plant 344,000 344,000 344,000 344,000 WFIQ – Building 90 South 217,500 217,500 217,500 217,500

Total Project Expenditures $2,955,620 $3,125,320 $2,688,850 $1,390,690

37


ECONOMIC DEVELOPMENT LOAN FUND

This fund accounts for the City’s small business loan pool, East Winston/Neighborhood Revitalization Strategy Area projects, and other economic development loans and grants.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Loan Servicing Expenditures $5,456 $0 $0 N/A Miscellaneous Expenditures - DRIVE 30,000 0 183,350 N/A Transfer to General Fund 0 4,000,000 0 -100.0%

Total Expenditures by Type $35,456 $4,000,000 $183,350 -95.4% RESOURCES BY TYPE Loan Repayments $6,671,818 $0 $0 N/A Investment Income 127,763 0 0 N/A Miscellaneous Revenue 1,014 0 0 N/A Transfer from General Fund 0 0 183,350 N/A Fund Balance Appropriation 0 4,000,000 0 -100.0%

Total Resources by Type $6,800,594 $4,000,000 $183,350 -95.4%

Addition to Fund Balance $6,765,138 $0 $0 N/A

URBAN DEVELOPMENT ACTION FUND

This fund accounts for the City’s economic development projects and loans for specifically designated “pockets of poverty,” as designated by federal regulations.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Contractual Services and Other Expenses $0 $0 $0 N/A

Total Expenditures by Type $0 $0 $0 N/A RESOURCES BY TYPE Loan Repayments $1,800 $0 $0 N/A Investment Income 1,469 0 0 N/A Sale of Real Estate 113,733 0 0 N/A

Total Resources by Type $117,002 $0 $0 N/A


38


POWELL BILL FUND (GASOLINE TAX)

This fund accounts for the City’s share of state gasoline tax revenues, which may only be used for maintenance of municipal streets and roads. Transfers from the Powell Bill fund are included in the budgets for the Department of Transportation and in the street resurfacing project in the Capital Plan.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Transfer to General Fund $3,788,283 $5,146,100 $5,146,100 0% Transfer to Capital Projects Fund 0 1,833,050 1,137,450 -37.9%

Total Expenditures by Type $3,788,283 $6,979,150 $6,283,550 -10.0% RESOURCES BY TYPE Gasoline Tax $6,365,704 $6,283,550 $5,800,790 -7.7% Investment Income 50,106 0 0 N/A Fund Balance Appropriation 0 695,600 482,760 -30.6%


Addition to Fund Balance $2,627,526 $0 $0 N/A

39


GRANTS FUND

This fund centralizes the accounting for other activities funded by federal, state, and intergovernmental aid. Service areas receiving grant support include public safety, recreation and culture, economic development, fair housing programs, general government, and public transportation.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Public Safety Grants $2,861,049 $897,830 $554,700 -38.2% Recreation and Culture Grants 40,324 0 0 N/A Economic Development Grants 102,848 0 55,000 N/A Fair Housing Grants 83,080 52,000 52,000 0% General Government Grants 232,747 0 0 N/A Public Transportation Grants 1,112,434 1,950,970 2,192,010 12.4%

Total Expenditures by Type $4,432,482 $2,900,800 $2,853,710 -1.6% RESOURCES BY TYPE North Carolina Department of Transportation $420,019 $1,064,480 $1,602,410 50.5% Forsyth County 189,768 208,500 208,500 0% US Department of Housing and Urban Development 78,311 50,000 50,000 0% Federal Transit Administration 368,673 488,710 136,020 -72.2% US Department of Justice 1,890,343 148,470 0 -100.0% Other State Grants 129,609 138,670 138,670 0% Contributions 223,851 2,000 2,000 0% Miscellaneous State Revenues 66,432 73,710 73,710 0% Miscellaneous Revenues 100,076 0 0 N/A Transfer from General Fund 834,092 708,760 570,200 -19.5% Transfer from Occupancy Tax Fund 55,000 0 55,000 N/A Transfer from Capital Projects Fund 50,220 0 0 N/A Transfer from Transit Administration Fund 27,688 17,500 17,200 -1.7%


40


OCCUPANCY TAX FUND

This fund accounts for the City’s approximate one-sixth share of Forsyth County’s 6% occupancy tax rate on the rental of hotel/motel accommodations.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Community Events $78,500 $0 $35,000 N/A Other Expenses 27,500 0 15,000 N/A Walk of Fame 5,066 10,000 10,000 0% Old Salem* 134,235 182,710 182,710 0% Piedmont Triad Film Commission 34,640 35,000 35,000 0% National Black Theatre Festival 115,000 115,000 115,000 0% RiverRun International Film Festival 31,800 42,400 42,400 0% Youth Events 118,562 0 0 N/A North Carolina City County Managers Association Winter Seminar

5,000 0 15,000 N/A

Transfer to Grants Fund 55,000 0 55,000 N/A Transfer to Winston-Salem Fairgrounds 75,000 37,500 75,000 100.0% Transfer to Convention Center Fund 300,000 240,390 300,000 24.8%

Total Expenditures by Type $980,304 $663,000 $880,110 32.7% RESOURCES BY TYPE Occupancy Tax $754,826 $663,000 $700,000 5.6% Investment Income 5,434 0 0 N/A Fund Balance Appropriation 220,044 0 180,110 N/A

Total Resources by Type $980,304 $663,000 $880,110 32.7% * The total contribution to Old Salem is $197,710. An additional $15,000 is budgeted in Sanitation as a reimbursement for municipal-type services.

41


STATE EMERGENCY TELEPHONE SYSTEM FUND

This fund accounts for revenues and expenses associated with operating the 911 system. The charge for all 911 services, wireline and wireless, now are placed in the State 911 Fund from which monthly allocations are made to primary public safety answering points (PSAP’s). The funds may be used to purchase replacement computers for the communications center and to cover the maintenance costs of communications center equipment.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Leased Lines $163,796 $165,000 $175,400 6.3% Computer-Aided Dispatch System 125,637 369,350 174,050 -52.9%

Total Expenditures by Type $289,433 $534,350 $349,450 -34.6%

RESOURCES BY TYPE

Reimbursement from E911 Wireless Board $528,588 $531,080 $0 -100.0% Interest Income 22,212 0 0 N/A Fund Balance Appropriation 0 3,270 349,450 10,586.5%

Total Resources by Type $550,800 $534,350 $349,450 -34.6%


DOWNTOWN WINSTON-SALEM BUSINESS IMPROVEMENT DISTRICT FUND

The Downtown Winston-Salem Business Improvement District is a defined area within the downtown area whereby the City may raise money to pay for enhanced services or projects from those property owners that most directly benefit from the services or projects. It is funded via a tax rate of $0.09 per $100 of valuation to fund the enhanced services and programs within the district. The rate is assessed on real and personal property, including registered motor vehicles.

Actual Budget Adopted Percent

EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change

Downtown Winston-Salem Partnership $592,490 $633,890 $596,470 -5.9% Other Expenses 4,096 24,050 24,250 0.8% Transfer to Parking Fund 50,000 50,000 0 -100.0%

Total Expenditures by Type $646,586 $707,940 $620,720 -12.3% RESOURCES BY TYPE Property Taxes $585,232 $657,940 $590,230 -10.3% Investment Income 449 0 0 N/A Fund Balance Appropriation 60,905 50,000 30,490 -39.0%

Total Resources by Type $646,586 $707,940 $620,720 -12.3%

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LEASING FUND

This fund accumulates annual payments from City departments to make lease payments to the North Carolina Municipal Leasing Corporation. The corporation assists the City in acquiring real and personal property through the issuance of certificates of participation (COPs) to fund the purchases. The corporation leases the property to the City, which provides lease payments that cover the interest and principal on the COPs as follows: governmental funds make equal annual payments over a five-year or three-year period, depending on the type of equipment being purchased, and proprietary funds make the same scheduled payments with the addition of an annual interest payment at a rate of 5.5%.

Actual Budget Adopted Percent

EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change

Principal Retirement $15,900,000 $11,400,000 $6,405,000 -43.8% Interest Payments 716,652 726,230 520,720 -28.3% Fiscal Expense 119,644 0 0 N/A Transfer to General Fund 9,180 37,730 93,900 148.9%

Total Expenditures by Type $16,745,476 $12,163,960 $7,019,620 -42.3% RESOURCES BY TYPE Lease Payments – City $22,301,260 $12,030,210 $8,263,770 -31.3% Lease Payments – Outside Agencies 415,861 414,370 233,030 -43.8% Investment Income 369,844 0 0 N/A


Addition to Fund Balance $6,341,490 $280,620 $1,477,180 426.4%

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ENTERPRISE FUNDS Enterprise funds provide public services that are operated in a manner similar to private business. Program descriptions and expenditure and resource details for each of the following funds are located in the service area sections of the budget document.

Actual Budget Adopted Percent EXPENDITURES BY FUND FY 19-20 FY 20-21 FY 21-22 Change Solid Waste Disposal Fund $9,923,594 $11,564,250 $11,849,120 2.5% Water and Sewer Funds 83,500,160 92,753,460 98,902,700 6.6% Parking Fund 1,685,358 1,946,080 1,474,890 -24.2% Winston-Salem Transit Authority 19,038,986 25,134,130 21,226,950 -15.5% Public Assembly Facilities Funds

Bowman Gray Stadium 506,540 307,440 360,370 17.2% The Benton 778,023 1,220,360 1,418,580 16.2% Winston-Salem Fairgrounds 4,775,565 4,059,530 4,135,630 1.9% Downtown Ballpark Fund 1,862,972 1,581,510 1,390,400 -12.1%

Stormwater Management Fund 9,618,207 10,989,580 11,108,290 1.1%

Total Expenditures by Fund $131,689,404 $149,556,340 $151,866,930 1.5% RESOURCES BY TYPE Property Taxes $10,689,399 $10,531,610 $11,199,590 6.3% Licenses and Permits 510,280 444,290 454,130 2.2% Intergovernmental Revenue 7,596,567 10,591,260 4,544,360 -57.1% Investment Income 6,119,446 0 0 N/A Interfund Revenues 3,517,092 3,076,430 3,249,080 5.6% Charges for Service 141,298,499 136,869,650 148,646,940 8.6% Fines and Forfeitures 0 12,000 12,000 0% Rentals/Other Resources 2,595,041 2,370,320 1,411,250 -40.5% Transfer from General Fund 541,690 979,970 2,908,500 196.8% Transfer from Occupancy Tax Fund 375,000 277,890 375,000 34.9% Transfer from Debt Service Fund 0 0 532,370 N/A Transfer from Other Enterprise Funds 862,721 762,000 755,490 -0.9%


Addition to Fund Balance $42,416,330 $16,359,080 $22,221,780 35.8%

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CAPITAL PROJECTS FUND

The capital projects fund provides budgetary accountability for financial resources used for the acquisition or construction of major capital improvements. Typically, projects are funded by general obligation bonds, two-thirds bonds, federal and state capital funds, general fund appropriations, and capital reserves.

EXPENDITURES Adopted Safe and Secure Community FY 21-22 Public Safety:

Fire Station Repaving Projects $485,000 Public Safety Facility Renewal 500,000

Safe and Secure Community Subtotal: $985,000

Livable Neighborhoods Recreation and Parks:

Granville Park Improvements $260,000 Park Bridge Improvements 230,000 Playground Safety Resurfacing 150,000 Recreation and Parks Facility Renewal 400,000 Recreation Maintenance Projects 719,000

Livable Neighborhoods Subtotal: $1,759,000

Quality Transportation Streets and Sidewalks: Bridge Repair and Replacement $5,500,000

Greenway Development 146,350 Sidewalk Maintenance / New Sidewalk Construction 146,350 Street Resurfacing Projects 2,637,450 Controlled Access Highway Streetlighting Maintenance 180,000 Decorative Streetlight Replacement 70,000 Traffic Calming Projects 146,350 Traffic Safety Projects 146,350

Quality Transportation Subtotal: $8,972,850

Service Excellence Office of Sustainability:

Solar PV System Installation $125,000

Property and Facilities Management: General Government Facility Renewal $2,375,000

Traffic Field Operations: City Yard Security Fencing and Controlled Access $250,000 Salt Dome Conveyor System 150,000

Service Excellence Subtotal: $2,900,000

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CAPITAL PROJECTS FUND

Total Expenditures $14,616,850

FUNDING SOURCES Bonds General Obligation / Two-Thirds $8,894,000 Intergovernmental Resources

Powell Bill Funds (Gasoline Tax) $1,137,450 North Carolina Department of Transportation 4,000,000

Other Motor Vehicle Privilege Tax $585,400

Total Funding Sources $14,616,850

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LEASING CAPITAL PROJECTS FUND The leasing capital projects fund provides budgetary accountability for the acquisition or construction of major capital improvements that are financed through the North Carolina Municipal Leasing Corporation (NCMLC).

Adopted EXPENDITURES FY 21-22 Economic Vitality and Diversity Public Assembly Facilities:

The Benton (Annual Capital Contribution) $250,000 Economic Vitality and Diversity Subtotal $250,000

Total Expenditures $250,000 FUNDING SOURCES Other

North Carolina Municipal Leasing Corporation $250,000

Total Funding Sources $250,000

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LEASING EQUIPMENT ACQUISITION FUND This fund accounts for the total cost of capital equipment, including computer hardware, for governmental funds that is financed through the North Carolina Municipal Leasing Corporation. City departments make annual lease payments of one-fifth of the purchase price in order to pay off the debt. With the exception of computers, the City lease-purchases equipment that costs $10,000 or more.

Actual Budget Adopted Percent EXPENDITURES BY TYPE FY 19-20 FY 20-21 FY 21-22 Change Capital Outlay

Rolling Stock $2,048,234 $4,780,000 $10,212,730 113.7% Computer Equipment 281,340 0 247,200 N/A General Equipment 416,860 274,440 2,534,260 823.4% Other 806,346 808,800 110,000 -86.4%

Total Expenditures by Type $3,552,780 $5,863,240 $13,104,190 124.0%

RESOURCES BY TYPE

North Carolina Municipal Leasing Corporation $3,552,780 $5,863,240 $13,104,190 124.0%


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ENTERPRISE CAPITAL PROJECTS FUNDS These funds provide budgetary accountability for financial resources used for the acquisition or construction of major capital improvements for enterprise operations. Typically, projects are funded by revenue bonds, special obligation bonds, enterprise fund capital reserves, federal and state capital funds, and certificates of participation. Projects financed through the North Carolina Municipal Leasing Corporation (NCMLC) also are accounted for in these funds. The annual lease payments charged by the NCMLC are budgeted in the enterprise funds’ operating budgets.

EXPENDITURES Adopted Economic Vitality and Diversity FY 21-22 Off-Street Parking

Parking Deck Renovations $250,000 Economic Vitality and Diversity Subtotal: $250,000

Healthy Environment Solid Waste Disposal

Hanes Mill Road Landfill – Mechanically Stabilized Earthen Retaining Wall $449,000 Water and Wastewater Treatment

Archie Elledge Wastewater Treatment Plant Rehabilitation and Upgrades $250,000 Biosolids Dryer Facility Upgrade 500,000 Muddy Creek Wastewater Treatment Plant Rehabilitation and Upgrades 250,000 R.W. Neilson Water Treatment Plant Rehabilitation and Upgrades 40,000,000 Water Treatment Rehabilitation and Upgrades 3,000,000

Water Distribution and Wastewater Collection Asset Management Program / Studies $1,500,000 Collection System Improvement Program 15,000,000 Facility Improvements Program 300,000 Lift Station Capacity/Condition Improvements 750,000 NCDOT Road Widening Project Utility Relocations 2,000,000 Water Distribution System Improvements 10,000,000 Water Tank Rehabilitation 250,000

Stormwater Management Basin Study Updates $300,000 Drainage Improvements on Private Property 250,000 Stormwater Infrastructure Renovations 1,000,000

Healthy Environment Subtotal: $75,799,000

Quality Transportation Mass Transit:

Fixed Route Bus Replacement $3,650,000 Passenger Amenities 66,920 Section 5339 Bus and Facilities Program 483,320 Security Enhancements 66,920 Trans-AID Vehicle Replacement 392,430

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ENTERPRISE CAPITAL PROJECTS FUNDS

EXPENDITURES - Continued Adopted FY 21-22

Transit Equipment Replacement $98,430 Transit Facility Renovations 492,140 Quality Transportation Subtotal: $5,560,720

Total Expenditures $81,609,720 FUNDING SOURCES Bonds

Revenue Bonds $22,000,000

Intergovernmental Federal:

Federal Transit Administration $4,694,490 State Revolving Loan 20,000,000

Reserves Solid Waste Disposal Fund $449,000 Stormwater Management Fund 1,550,000 Water and Sewer Fund 31,800,000 Winston-Salem Transit Authority Fund 866,230

Other North Carolina Municipal Leasing Corporation $250,000

Total Funding Sources $81,609,720

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FIDUCIARY FUNDS The fiduciary fund listed below accounts for the City’s post-employment benefits programs, including retiree health and life benefits.

Actual Budget Adopted Percent EXPENDITURES BY PROGRAM FY 19-20 FY 20-21 FY 21-22 Change Retiree Life and Health Benefit Fund $10,093,761 $9,958,600 $9,981,280 0.2%

Total Expenditures by Program $10,093,761 $9,958,600 $9,981,280 0.2%

RESOURCE BY TYPE City Contribution $2,856,574 $2,910,300 $1,536,470 -47.2% Employee Contribution 1,950,102 2,209,000 2,204,000 0.2% Investment Income 1,017,246 1,000,000 1,000,000 0% Fund Balance Appropriation 4,269,839 3,839,300 5,240,810 37.0% Total Resources by Type $10,093,761 $9,958,600 $9,981,280 0.2%

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ESTIMATED CHANGES IN FUND BALANCES The North Carolina Local Government Commission (LGC) recommends that units of government maintain a minimum fund balance in their operating funds of 8% of estimated total expenditures. This level has been determined to be the equivalent of one month’s expenditures and is generally regarded as a minimum level to avoid cash flow interruptions, generate interest income, reduce the need for short-term borrowings, and assist in maintaining investment grade bond ratings. The city’s policy is to maintain a minimum fund balance of at least 14% of estimated expenditures in the general fund. For other funds, the City’s financial policies dictate the level of reserves that should be maintained. Reserves for other funds are also monitored regularly to ensure sufficiency for operating and capital needs. The balances listed below represent audited amounts for June 30, 2020, estimates for June 30, 2021 prior to final audited figures being available, and projected amounts for June 30, 2022.

Fund Balance/ Estimated Expected Use(-)/ Projected

Reserves Fund Balance Addition to (+) Fund Balance

Fund 6/30/2020 6/30/2021 FB by 6/30/2022 6/30/2022

Budgeted Funds

General 49,058,154$ 54,553,063$ (1,350,000)$ 53,203,063$

Grants Fund 2,257,297 626,000 - 626,000

Forfeiture Funds 664,907 959,741 - 959,741

Economic Development Funds2

34,192,617 34,656,519 (60,450) 34,596,069

Gas Tax Fund 3,323,131 4,475,493 (482,760) 3,992,733

Occupancy Tax Fund 147,962 130,479 (180,110) (49,631)

Emergency Telephone Fund 1,995,564 2,161,085 (349,450) 1,811,635

Downtown Business Imp District 56,698 12,623 (30,490) (17,867)

Debt Service Fund 33,449,214 39,168,385 2,126,220 41,294,605

Capital Projects Fund 12,358,655 45,775,066 - 45,775,066

Leasing Fund 21,564,950 13,900,000 1,477,180 15,377,180

Water & Sewer Fund 126,596,901 115,798,727 24,838,020 140,636,747

Solid Waste Disposal Fund 47,909,978 48,554,668 1,362,480 49,917,148

Parking Fund 1,283,697 332,263 - 332,263

Stormwater Management Fund 25,156,659 23,413,725 (575,330) 22,838,395

Winston-Salem Transit Authority Funds 1,111,437 3,501,717 - 3,501,717

Public Assembly Facilities Management 1,918,748 - - -

Internal Service Funds 343,767 - - -

Employee Benefits Funds 19,411,442 18,400,000 (6,930,080) 11,469,920

Non-Budgeted Funds1

Post-Employment Benefits Fund 66,213,062 76,000,000 - 76,000,000

WSPORS 160,960,687 195,000,000 - 195,000,000

Separation Allowance Fund 10,527,530 12,500,000 - 12,500,000

Perpetual Care Fund 4,147,780 4,061,245 - 4,061,245

Risk Acceptance Management Corp. 39,146,201 50,300,000 - 50,300,000

Total 663,797,038$ 744,280,799$ 19,845,230$ 764,126,029$

(1) Non-budgeted funds are fiduciary (trust) and permanent funds that are not required to be budgeted.

(2) Fund balance includes loans not received in cash in the amount of $10,655,261.

FUND BALANCES/CASH RESERVES BY FUND

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Documents

FUND SUMMARIES