financial analyses non profit government

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please read all the instructions and only bid if you can complete with accuracy. NEED TO HAVE EXPERIENCE IN FINANCE OR ACCOUNTING

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TutorLarra
School: New York University

Attached.

Running head: CAFR

1

Charleston Comprehensive Annual Financial Report
Name
Institutional Affiliation

CAFR

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Charleston Comprehensive Annual Financial Report

Introduction
Governmental entities such as towns, cities, and counties are required to operate as
separate legal entities. The city is termed as a separate entity, and they have to prepare financial
statements. The Mayor of Charleston is termed as the Chief Executive Officer, and they have to
ensure the town adheres to the concept of fiscal prudence. The city is considered as an
independent entity and needs to be considered in terms of analyzing the CAFR method, the
different sections in the financial statement, basis of accounting, sources of revenue and
information about the general fund.
Analysis of CAFR
The town of Charleston is a town in the broader South Carolina State. The town is
required to prepare a financial statement as per the rule established by the state of South
Carolina. The city has adhered to the common practice in preparing CAFR (Mckinney, 2015).
The first part of the report is the introductory section followed by the financial section and the
statistical section. The financial reports have to focus on the governmental funds and the nongovernmental funds. The statements presented by the town have to pass the various tests
established as per the auditing standards. The audit under consideration in 2017 focused on the
procedures used to obtain evidence on numerous amounts in the financial reports (Wharton,
2017). It also focused on the disclosures provided in the reports and the material effect. The
financial statements included business-type activities, aggregate remaining fund information, and
the amount involved in each significant fund.

CAFR

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The financial statement presented by the town in 2017 included an independent auditors

report. The auditor used by the city was Mauldin and Jenkins, and the town had to ensure that
they had a solid reputation. The auditor had to ensure the reports offered a fair representation in
terms of the financial statements. The auditor focused on aspects such as the risk associated with
financial misstatements. The audit report provided a qualified opinion regarding the financial
reports stating that they presented an accurate and fair view of the business operations. The town
did not provide for an internal auditor, and the compliance tests were conducted by the external
party.
Analysis of Charleston Town
The comprehensive annual financial report focuses on particular aspects such as the
government profile. In this section, the report focuses on ensuring the management guarantees
the completeness and the reliability of the information included. In doing this, they can earn the
trust of the public. In the introductory section, the town focuses on explaining the financial
policies (Mckinney, 2015). They also point out the need for the auditing function and the state
law used in preparing the financial report. The introductory part includes the organizational chart
as per the local structures. The financial section contains information such as the ranking of the
Port of Charleston as the 8th port in the country since it had handled cargo worth $69.96 million
(Wharton, 2017). The section also includes different classification such as governmental and
business-type activities. The town has also focused on the concept of long term financial
planning.
The town has employed different methods in terms of comparing the budget to the actual
reports. Each fiscal year, they have to come up with a budget to be used in the next year. The

CAFR

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town has to prepare an original budget, a final budget, the actual budget and the variance with
the budget. For example, in terms of total revenues the original budget is $154,335,282, the final
is $155,027,621, the actual is $160,514,504, and the variance is $5,486,883 (Wharton, 2017).
The preparation of the budgets helps the business come up with avenues to help them deal with
the variances.
The town has adopted the accrual basis of accounting in the preparation of the financial
reports. It provides for the recognition of revenues when they are earned and not when the cash
changes hands (Arapis & Grady 2015). The expenses are also recognized when they are incurred
and not when they are paid for. In the town of Charleston, the property taxes are to be included
in the reports when they are levied.
Analysis of Sources of Revenue
The property taxes from government activities stand at $40,436,629. They have to be
considered since they are included in the general fund used to fund operations within the town.
The financial reports indicate that the business-type activities have increased by $266,292 from
the previous fiscal year. The net pension liability resulting from governmental activities stands at
$13,105,109 in the current year (Wharton, 2017). The report also indicates that the deferred
inflows and assets exceeded the liabilities and deferred outflows by $849,843,334 which was
stated as the net position.
There were other sources identified as sources of primary revenue. The accounts were
recorded at $5,788,936 while the others stood at $4,138,194. The financial report indicates that
the income due from the federal government stands at $452,833. Such revenues are to be used in
projects proposed by the state such as the promotion of tourism and investment in parking

CAFR

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facilities. In terms of deferred revenue, the pension stands at $247,223. The tax increment
financing for the districts has been recorded at $12,657,741 (Wharton, 2017).
The town has included the management discussion which focuses on aspects such as the
accounting policies. The city has chosen to use accounting policies established in the United
States and have to apply to all entities. The municipalities are required to prepare the general
fund statements and have to involve an auditor. In Charleston, the reports have to be ready six
months before the start of the next fiscal year. One has to consider the general fund which
includes aspects such as the proprietary and the fiduciary fund. The financial report indicates that
the general fund balance increased to $63,837,633 (Wharton, 2017). That can be termed as an
indication that the town is doing well and can meet current and future obligations.

CAFR

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References

Arapis, T., & Grady, D. (2015). State Financial Reporting Evolution: What If CAFRs Could
Talk? Journal of Government Financial Management, 64(2), 24–29. Retrieved from
http://proxy.cityu.edu/login?url=http://search.ebscohost.com/login.aspx?direct=true&db=
bth&AN=109387035&site=ehost-live&scope=site
Mckinney, J. (2015). Effective Financial Management in Public and Nonprofit Agencies (4th
ed.). Praeger.
Wharton, A. (2017). CITY OF CHARLESTON, SOUTH CAROLINA COMPREHENSIVE
ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2017.
Retrieved from https://www.charleston-sc.gov/DocumentCenter/View/18837


CITY OF CHARLESTON,
SOUTH CAROLINA
COMPREHENSIVE ANNUAL FINANCIAL
REPORT
FOR THE YEAR ENDED DECEMBER 31, 2017

WITH
REPORT OF INDEPENDENT AUDITORS

PREPARED BY:

DEPARTMENT OF BUDGET, FINANCE & REVENUE
COLLECTIONS

Amy K. Wharton, Chief Financial Officer

CITY OF CHARLESTON, SOUTH CAROLINA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED DECEMBER 31, 2017

TABLE OF CONTENTS
Page(s)
INTRODUCTORY SECTION
Letter of Transmittal .......................................................................................................................................iv ‐ x
Certificate of Achievement for Excellence in Financial Reporting ........................................................................ xi
List of Principal Officials..................................................................................................................................... xii
Organizational Chart......................................................................................................................................... xiii
FINANCIAL SECTION
Independent Auditor’s Report ........................................................................................................................ 1 ‐ 3
Management’s Discussion & Analysis ........................................................................................................... 4 ‐ 16
Basic Financial Statements:
Government‐wide Financial Statements:
Statement of Net Position .......................................................................................................... 17 and 18
Statement of Activities ............................................................................................................... 19 and 20
Fund Financial Statements:
Balance Sheet – Governmental Funds............................................................................................. 21 – 24
Reconciliation of the Balance Sheet – Governmental Funds to the
Government‐wide Statement of Net Position ...................................................................................... 25
Statement of Revenues, Expenditures and Changes in
Fund Balances – Governmental Funds ...................................................................................... 26 and 27
Reconciliation of the Statement of Revenues, Expenditures and Changes
In Fund Balances – Governmental Funds to the Government‐wide Statement of Activities ....... 28 and 29
Statement of Revenues, Expenditures and Changes in Fund
Balance – Budget and Actual – General Fund ................................................................................ 30 – 32
Statement of Net Position – Proprietary Funds ........................................................................... 33 and 34
Statement of Revenues, Expenses and Changes in
Net Position – Proprietary Funds ......................................................................................................... 35
Statement of Cash Flows – Proprietary Funds ............................................................................. 36 and 37
Statement of Fiduciary Assets and Liabilities – Fiduciary Fund ............................................................... 38
Notes to Financial Statements……………………………………………………………………………………………………………….39 – 93
Required Supplementary Information:
Schedule of Funding Progress – Other Post‐Employment Benefits –
Defined Benefit Health Care Plan ............................................................................................................ 94
Schedules of City’s Proportionate Share of the Net Pension Liability ............................................................ 95
Schedules of City Contributions .................................................................................................................... 96

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CITY OF CHARLESTON, SOUTH CAROLINA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED DECEMBER 31, 2017

TABLE OF CONTENTS (CONTINUED)
Page(s)
FINANCIAL SECTION (CONTINUED)
Combining and Individual Fund Financial Statements and Schedules:
Nonmajor Governmental Funds ............................................................................................................. 97 ‐ 99
Combining Balance Sheet – Nonmajor Governmental Funds ...............................................................100 ‐ 103
Combining Statement of Revenues, Expenditures and Changes in
Fund Balances – Nonmajor Governmental Funds .........................................................................104 ‐ 107
Schedule of Revenues, Expenditures and Changes in Fund Balance ‐
Budget and Actual – Municipal Accommodations Fee Fund ................................................................. 108
Nonmajor Proprietary Funds ....................................................................................................................... 109
Combining Statement of Net Position – Nonmajor Proprietary Funds ......................................................... 110
Combining Statement of Revenues, Expenses and Changes in
Net Position – Nonmajor Proprietary Funds ........................................................................................ 111
Combining Statement of Cash Flows – Nonmajor Proprietary Funds ........................................................... 112
Agency Funds .............................................................................................................................................. 113
Statement of Changes in Assets and Liabilities – Agency Fund..................................................................... 114
Supplementary Information Required by the State of South Carolina:
Other Financial Information
Uniform Schedule of Court Fines, Assessments and Surcharges (per ACT 96).................................. 115 and 116
STATISTICAL SECTION
Statistical Section ............................................................................................................................................ 117
Financial Trends:
Net Position by Component .................................................................................................................. 118
Changes in Net Position ........................................................................................................... 119 and 120
Fund Balances of Governmental Funds ................................................................................................. 121
Changes in Fund Balances of Governmental Funds ................................................................................ 122
Revenue Capacity:
Governmental Activities Tax Revenues by Source ................................................................................. 123
General Governmental Tax Revenues by Source ................................................................................... 124
Assessed Value and Estimated Actual Value of Taxable Property .......................................................... 125
Property Tax Rates ‐ Direct and Overlapping Governments ................................................................... 126
Principal Property Taxpayers ................................................................................................................ 127
Property Tax Levies and Collections ...................................................................................................... 128

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CITY OF CHARLESTON, SOUTH CAROLINA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED DECEMBER 31, 2017

TABLE OF CONTENTS (CONTINUED)
Page(s)
STATISTICAL SECTION (CONTINUED)
Debt Capacity:
Stormwater System Continuing Disclosure............................................................................................ 129
Ratios of Outstanding Debt by Type ...................................................................................................... 130
Ratios of General Bonded Debt Outstanding ......................................................................................... 131
Direct and Overlapping Governmental Activities Debt .......................................................................... 132
Legal Debt Margin Information ............................................................................................................. 133
Pledged Revenue Coverage ...................................................................................................... 134 and 135
Demographic and Economic Information:
Demographic and Economic Statistics ................................................................................................... 136
Principal Employers – Metro Area ......................................................................................................... 137
Operating Information:
Full‐time Equivalent City Government Employees by Function .............................................................. 138
Operating Indicators by Function .......................................................................................................... 139
Capital Asset Statistics by Function ....................................................................................................... 140
Bond Information:
Schedule of Bond Principal and Interest Requirements to Maturity:
Business‐type Activities .................................................................................................................. 141
Governmental Activities .................................................................................................... 142 and 143
Government‐wide ............................................................................................................. 144 and 145

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INTRODUCTORY SECTION

JOHN J. TECKLENBURG
Mayor

City of Charleston
South Carolina

AMY K. WHARTON
Chief Financial Officer

Department of Budget, Finance
and Revenue Collections
June 27, 2018

To the Honorable Mayor John J. Tecklenburg,
Members of City Council, and
Citizens of the City of Charleston:

State law requires that every general purpose local government publish, within six months of the
close of each fiscal year, a complete set of audited financial statements. The report is to be audited by
an independent firm of certified public accountants. Pursuant to that requirement, we are pleased to
submit this Comprehensive Annual Financial Report for the City of Charleston’s fiscal year ended
December 31, 2017.
Management assumes full responsibility for the completeness and reliability of the information
contained in this report, based on a comprehensive framework of internal control that has been
established for this purpose. Because the cost of internal control should not exceed anticipated
benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial
statements are free of any material misstatements.
Mauldin & Jenkins, LLC, Certified Public Accountants, have issued an unmodified (“clean”) opinion
on the City of Charleston’s financial statements for the year ended December 31, 2017. The
independent auditor’s report is located at the front of the financial section of this report.
Management’s Discussion and Analysis (MD&A) immediately follows the independent auditors’
report and provides a narrative introduction, overview, and analysis of the basic financial statements.
This letter of transmittal is designed to complement the MD&A and should be read in conjunction with
it.

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GOVERNMENT PROFILE
The City of Charleston is located on the southeastern coast of South Carolina and is the principal
seaport for the state. First established in 1670, the settlement was moved to the peninsula formed by
the convergence of the Ashley and Cooper Rivers in 1680. The City had a land area of only 6.12 square
miles and did not extend its corporate limits until 1960, when a large area west of the Ashley River was
annexed. In 1991, Daniel Island was annexed, adding 10 square miles. Currently, the City occupies 112
square miles spread over Charleston and Berkeley Counties and has 8 square miles of vital, bustling
downtown, which is home to the City’s central business district. According to the 2010 Census, the
population is 120,083 persons, making it the second largest city in South Carolina. However, according
to U.S. Census Bureau estimates in 2016, Charleston may now be the largest city in the state. As a result
of both growth within the City and annexations, the population increased 24.2% between 2000 and
2010.
The Mayor is the Chief Executive Officer of the City of Charleston, which operates under a strong
mayor form of government. The Mayor is also the presiding officer of City Council, which consists of
twelve council members who are elected for staggered four‐year terms from single‐member districts.
The Mayor has no veto power, but casts a vote similar to those cast by each member of the Council.
Regular meetings open to the public are held twice a month during the year, except for the months of
June, July and August in which only one meeting is held each month. The Chief Financial Officer (CFO)
supervises all financial matters for the City.
The City of Charleston provides a broad range of services that include:
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(12)
(13)

Public Safety – law enforcement, fire protection and emergency preparedness
Municipal Court
Traffic and Transportation
Street, Sidewalk and Drainage Maintenance
Waste Disposal
Planning, Zoning and Urban Development
Code Enforcement
Business Support and Development
Park Development and Maintenance
Recreational Facilities and Program Initiatives
Children, Youth, Family, Senior and Disabled Citizens Programs
Tourism Management
Arts and Cultural Programs and Events

The City of Charleston is financially accountable for the City of Charleston Public Facilities Corporation,
which, although a legally separate entity, is included in the financial data of the City as a blended
component unit. Additional information on this and other related entities can be found in the notes to the
financial statements (see Notes 1.A. and 16.) The following entities are related to the City of Charleston, but
do not meet the requirements for inclusion in this report: Charleston Water Systems (legally named
Commissioners of Public Works), Charleston Housing Authority, Charleston Citywide Local Development
Corporation, Charleston Museum, Gibbes Museum of Art, and Charleston Area Regional Transportation
Authority (CARTA).

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City Council must approve the budget by December 31 of the preceding year. The Budget &
Management Division, with input from the various City departments, prepares the budget, which is then
presented to the Mayor and City Council for approval. Activities of the General Fund and enterprise funds
are included in the annual budget, but enterprise funds adopt formal budgets for management control
purposes only. A balanced budget is required. Budgetary controls are maintained to ensure compliance
with legal provisions. Current appropriations in all funds are limited to the sum of available, unencumbered
fund balances and revenues estimated to be received in the current budget year. The City maintains an
encumbrance accounting system, a technique of accomplishing budgetary control.
LOCAL ECONOMY
The City is currently experiencing growth in its economy. Unemployment in the Charleston‐North
Charleston Metropolitan Statistical Area (MSA) was 2.3% as of April 2018, after reaching a high of 10.2%
in January of 2010. Trending consistently lower than the state average of 4.2%, Charleston County’s
April 2018 unemployment rate is the lowest of South Carolina’s 46 counties. Average private sector
weekly earnings for 2017 for Charleston County were 8.9% higher than the state average. Continued
improvement in the regional economy is expected through 2018, particularly in the Advanced
Manufacturing, Logistics and Transportation and Information Technology sectors. The region has the 8th
largest U.S. seaport (2017 rankings) in dollar value of cargo handled, one of our nation’s most impressive
medical hubs, a multi‐billion dollar tourism industry, an established base of national and international
manufacturers and a large military presence. The Brookings Institution ranked the Charleston area at
sixteenth in share of jobs for High Digital Skill Occupations. Recently, the Milken Institute Review listed
Charleston 22nd on their “Best Performing Cities” list for 2017. The list indexes U.S. metropolitan areas
by how well they are creating and sustaining jobs and economic growth. WalletHub ranked Charleston
fourth in its “Best Cities to Start a Career” list and tied for first in the “Most Entry‐Level Jobs” list. Forbes
ranks Charleston fourth in “Best Mid‐size U.S. Metro for Jobs” list in 2017.
The Boeing Company is one of the area’s largest employers with approximately 7,400 employees.
April 2012 marked the delivery of the first jet constructed in Boeing’s $750 million 787 Dreamliner final
assembly plant adjacent to the Charleston International Airport. In 2014, the Boeing Research &
Technology Center opened, which focuses on advanced manufacturing technology and composite
fuselage manufacturing. Propulsion South Carolina, a new 225,000 square‐foot facility that produces
engine components for the 737 MAX jet, also opened in 2014. In late 2016, Boeing opened a new
230,000 square‐foot Decorative Paint Facility which applies logos and graphics to finished 787 aircraft.
Additionally, Volvo broke ground on its first North American car plant in September of 2015. Due to
open in 2018, the $500 million factory is being built in Berkeley County and will produce up to 100,000
cars per year and eventually employ 4,000 people. Volvo has already announced plans to expand the
plant at an additional cost of $520 million. Volvo cited the area’s trained workforce and the Port of
Charleston, with its overseas accessibility, as key factors in its final decision. Daimler AG also recently
announced plans to expand its plant in North Charleston to build the popular Mercedes‐Benz Sprinter
cargo vans at a cost of $500 million. Approximately 1,300 jobs will be added. Daimler also cited
workforce training and port access as key factors in the decision to add to its local operation. The plant
is scheduled to be fully operational by 2020.
As the fastest growing major U.S. port since 2011, the Port of Charleston continues to be a
cornerstone of the area’s economy. The Port of Charleston ranked 8th for 2017 in the U.S. in dollar value
of cargo handled at $69.96 million. In 2017, a record 2.177 million TEUs (twenty‐foot equivalent units –
a measurement of cargo volume related to containers) and 224,000 cruise passengers passed through

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the port. South Carolina shipping firms are able to serve over 150 nations with top markets being
Northern Europe and Northeast Asia. A U.S. Army Corps of Engineers study recommended the
deepening of the harbor from 45 feet to 52 feet, a project expected to cost $509 million. In December
of 2015, the Corps of Engineers and the State Ports Authority signed the Preconstruction Engineering
and Design Agreement, and Congressional Authorization was recommended in January of 2016. At 52
feet, Charleston Harbor will be the deepest on the East Coast and will be accessible 24 hours a day
without any tidal restrictions, with container volume expected to increase as a result. Work will begin in
2018. Additionally, the State Ports Authority and the State of South Carolina plan to spend another $2
billion on the ports and port‐related infrastructure over the next 10 years. The improvements include a
new container terminal, new dual access intermodal railhead, an interstate highway expansion and new
port access road. In addition to its cargo activities, the Port of Charleston is also home to a thriving
cruise ship industry, which contributes $37 million annually to the area’s economy, including more than
400 jobs and a boost to both retail sales and tourism.
Founded in 1824, the Medical University of South Carolina (MUSC), headquartered in downtown
Charleston, continues to be the City’s key employer with more than 13,000 employees, including 1,700
faculty members, $2.3 billion in collective annual operating budgets and a $3.8 billion annual economic
impact. MUSC is the state’s primary teaching hospital and has gained worldwide exposure for its
centers of excellence in cardiovascular care, cancer/oncology, the neurosciences, biotechnology,
pediatrics, organ transplantation and psychiatry. A twenty‐year expansion plan has resulted in
significant capital infrastructure additions to the campus, including a state‐of‐the‐art cardiovascular and
digestive disease hospital and research facilities in the areas of cancer genomics, bioengineering and
drug discovery. In addition to its downtown campus, MUSC has many satellite facilities in the region and
across the state.
Tourism is a vital part of the economy in Charleston with 6.9 million visitors in 2017. Charleston has
recently received regional, national and worldwide recognition as a top city to visit. For the past seven
years, Condé Nast Traveler ranked Charleston the “No. 1 Small U.S. City.” Visitors to the Charleston
area contribute an estimated $7.37 billion annually to the area’s economy, resulting in an estimated
47,000 direct and indirect jobs and $2.7 billion in total labor earnings. Over 20% of all sales can be
attributed to tourism. In the tri‐county area, lodging sales for 2017 totaled $904 million and attendance
at local attractions totaled 2.628 million visits. Various tourism‐based revenues such as the hospitality
fee and the state and local accommodations taxes provide funding to the City to support tourism‐
related services and facilities.
Formulating the 2018 budget required careful consideration in order to operate within projected
revenues. Modest revenue growth is expected in 2018, mainly in the areas of property taxes, licenses,
permits, and sales taxes. New construction has increased over the last five years, leading to growth in
the property tax base and increased revenue from building permits. Additionally, the residential real
estate market has improved, increasing the tax base as properties are sold at higher values. Business
license revenues and sales tax revenues have benefitted from rebounding consumer spending. For 2018,
unassigned fund balance of $315,000 is budgeted to be spent.
In October of 2017, Standard and Poor’s (S&P) affirmed the City’s AAA bond rating, the highest
available for a general obligation bond issue. S&P rated the City’s management as strong, with good
financial policies and practices. Also in October of 2017, Moody’s Investors Services affirmed the City’s
bond rating of Aaa, its highest rating, citing the City’s conservative budgeting and sound reserve levels,

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improved liquidity and strong financial policies. Both agencies confirmed Charleston’s outlook as
“stable.”
LONG‐TERM FINANCIAL PLANNING
The City has long‐range financial plans in the areas of capital projects, equipment replacement, cash
management/investments and debt. The City’s rolling five‐year Capital Improvement Plan (CIP) is
guided by the following policies: the CIP is updated annually and includes anticipated funding sources;
projects funded by debt will be financed over a period not to exceed the useful life of the asset; assets
will be preserved to protect capital investments and minimize future costs; funding of projects will be
appropriately distributed between bonded debt and cash financing; and operating costs resulting from
projects will be identified and included in future budgets. The CIP calls for $301,649,074 of expenditures
during 2018‐2022.

RELEVANT FINANCIAL POLICIES
The City’s Mission and Values provide the basic framework for the construction of the annual
budget each year. Over the last few years, a critical factor in the budget process has been the economy
and its impact on City revenues, requiring the City to react with appropriate and fiscally responsible
actions to balance its budget. At the same time, City staff is tasked with continuing to meet the needs of
its citizens within the budget each year with the following emphasis:





Strengthening our police and fire departments
Continuing priority funding of core municipal services
Maintaining strong funding for City sponsored infrastructure improvements
Continuing our efforts to be an employer of choice

The City’s policy is to maintain an unassigned fund balance in the General Fund at 20% of the
General Fund budgeted expenditures for the following year. This policy was revised beginning in 2014;
previously the target was 15%, with the goal of reaching 20% by December 2015. This target is
considered necessary given the possibilities of naturally occurring events in this region that could disrupt
normal revenue flows. As of December 31, 2017, the General Fund unassigned fund balance is
$36,391,210 or 20.2% of the 2018 budgeted General Fund expenditures.

MAJOR INITIATIVES
CAPITAL FACILITIES: The City of Charleston continues to improve existing facilities and build new ones
designed to meet the service needs of its citizens. Maintenance projects ranging in cost from $30,000 to
$1,200,000 are in progress or planned for existing or new facilities located in all parts of the City.
Significant capital improvements include the following:
 In 1984, the City prepared a Master Drainage Plan which identified stormwater projects in areas
throughout the City. Projects are prioritized based on the cost of property damage caused by
stormwater and other factors. The plan is reviewed and updated continually. Funding sources
include the Stormwater Utility Fee and the Drainage Fund, federal grants, bonds, and TIF
funding. Major drainage improvement projects which have already been completed are

viii

Ardmore, Calhoun East and Byrnes Downs. Projects which are currently underway or will be
underway in the near future include:
 U.S. 17/Spring/Fishburne Drainage Improvement Project Phases 2 through 5 –
$131,000,000
 Market Street Drainage Improvement Project, Division III Surface Collection and
Conveyance – $7,296,000
 Forest Acres Drainage Improvement Project – $14,147,000
 Calhoun West Drainage Improvement Project Study and Design Phase –
$12,733,000
Funding already secured for these projects includes a $10,000,000 American Recovery and
Reinvestment Act (ARRA) of 2009 Transportation Investment Generating Economic Recovery
(TIGER) Grant and $88,000,000 from the State Infrastructure Bank (SIB) for the U.S.
17/Spring/Fishburne project. Additionally, revenue bonds of $46,725,000 were issued in June
2012 for funding of drainage projects. Stormwater utility fee revenues are pledged towards
payment of these bonds. Dedicated millage of 4 mills also funds drainage projects.
 Major restoration efforts are underway on Charleston’s iconic seawall, known as “The Battery.”
Two phases have been completed – “The High Battery” and “The Turn.” The third phase is “The
Low Battery”, along Murray Boulevard. Construction is slated to begin in 2018 and will be done
in sections over approximately ten years. The estimated cost is $100,000,000.
PARKING: In 2015, the City began updating all of the gate and revenue control equipment in its parking
facilities. Once installation is complete, the City will have a centrally networked parking system that
links together all facilities, allowing for increased efficiencies, improved reporting and revenue control,
and improved communication, organization and customer service. This equipment upgrade will also
include automation of the payment process, featuring both pay in lane and pay on foot technologies.
Estimated cost in 2018 is approximately $1.58 million. An upgrade of the City’s 1,700 parking meters
began in 2017. Once upgraded, meters will also accept credit and debit cards. All parking expenditures
are budgeted in the Parking Facilities Enterprise Fund.
PUBLIC SAFETY: The City of Charleston continues to work to strengthen the police and fire
departments. In July of 2015, the Charleston Fire Department was accredited by the Commission on
Fire Accreditation International (CFAI) following a 4‐day onsite peer evaluation. With this accreditation,
CFD becomes one of 22 fire departments nationwide to earn accreditation and the Insurance Services
Office (ISO) Class 1 rating. In 2018, the Carolina Bay Fire Station (FS 14) will open and the budget
includes the related operating costs to fully staff and equip the facility.
In late 2014, millage dedicated specifically to Public Safety infrastructure was passed effective for
2015. The property tax revenues generated by this 1.5 mill levy will be used to support a borrowing to
build two new fire stations (Cainhoy and West Ashley), a new police forensic lab facility, and a new
police substation (West Ashley). Additionally, property has been purchased to construct a replacement
for Station 11 in West Ashley. This millage is separate from the general operating millage, but the
General Fund will be impacted by the cost of staff and apparatus for the new fire stations once they are
completed.

ix

x

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CITY OF CHARLESTON, SOUTH CAROLINA
LIST OF PRINCIPAL OFFICIALS
DECEMBER 31, 2017
Elected Officials
Mayor
Councilmember (District 1)
Councilmember (District 2)
Councilmember (District 3)
Councilmember (District 4)
Councilmember (District 5)
Councilmember (District 6)
Councilmember (District 7)
Councilmember (District 8)
Councilmember (District 9)
Councilmember (District 10)
Councilmember (District 11)
Councilmember (District 12)

John J. Tecklenburg
Gary White, Jr.
Rodney Williams
James Lewis, Jr.
Robert M. Mitchell
Marvin D. Wagner
William D. Gregorie
Perry K. Waring
Michael S. Seekings
A. Peter Shahid, Jr.
Dean C. Riegel
William A. Moody, Jr.
Kathleen G. Wilson

Appointed Officials
Chief Financial Officer
Deputy Chief Financial Officer
Assistant Chief Financial Officer
Finance Director

Amy K. Wharton
Matthew A. Frohlich
Joleen Deames
Donna Looms Emerson

Chief Information Officer
Clerk of Council/Tourism Director
Corporation Counsel
Fire Chief ‐‐ Interim
Housing and Community Development Director
Human Resources and Organizational Development Director
Internal Auditor
Livability and Tourism Director
Municipal Court Chief Judge
Parks Director
Planning, Preservation and Sustainability Director
Police Chief ‐‐ Interim
Public Service Director
Recreation Director
Senior Advisor to the Mayor
Senior Advisor to the Mayor
Traffic and Transportation Director

Wes Ratterree
Vanessa Turner‐Maybank
Frances Cantwell
John Tippett
Geona Shaw‐Johnson
Kay Cross
Robert Majernik
Daniel Riccio
Joseph S. Mendelsohn
Jason Kronsberg
Jacob Lindsey
Jerome Taylor
Laura Cabiness
Laurie Yarbrough
Richard Jerue
Josh Martin
Keith Benjamin

xii

CITY OF CHARLESTON
ORGANIZATIONAL CHART
DECEMBER 31, 2017

Citizens of
Charleston

City Council
Council
Committees, Boards
and Commissions

Mayor

Special Assistant

Municipal Judges

xiii
Chief of Police

Chief of Fire

Police

Fire

Emergency
Management

Fleet

Chief Financial
Officer
Budget, Finance
and Revenue
Collections
Human
Resources
Information
Technology

Executive

Internal Audit

Corporation
Counsel

Municipal Court

Senior Advisor

Quality of Life

Public
Information

Housing and
Community
Development

Parks

Planning,
Preservation, &
Sustainability

Senior Advisor

Cultural Affairs

Mayor's Office for
Children, Youth,
and Families

Livability and
Tourism

Public Service
Recreation

ADA

Prosecutor's
Office

Traffic &
Transportation

Executive
Administrative
Staff

Clerk of Council

FINANCIAL SECTION

INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and Members of City Council
City of Charleston, South Carolina
Charleston, South Carolina
Report on the Financial Statements

We have audited the accompanying financial statements of the governmental activities, the business‐type activities,
each major fund and the aggregate remaining fund information of the City of Charleston, South Carolina (the "City"),
as of and for the year ended December 31, 2017, and the related notes to the financial statements, which
collectively comprise the City’s basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance
with accounting principles generally accepted in the United States of America; this includes the design,
implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial
statements that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit
in accordance with auditing standards generally accepted in the United States of America and the standards
applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the
United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the
risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the
financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no
such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the
reasonableness of significant accounting estimates made by management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinions.

508 HAMPTON STREET, FIRST FLOOR • COLUMBIA, SOUTH CAROLINA 29201 • 803-799-5810 • FAX 803-799-5554 • www.mjcpa.com
MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS

1

Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business‐type activities, each major fund and
the aggregate remaining fund information of the City, as of December 31, 2017, and the respective changes in
financial position and, where applicable, cash flows thereof and the respective budgetary comparison for the
General Fund for the year then ended in accordance with accounting principles generally accepted in the United
States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management’s Discussion
and Analysis (on pages 4 through 16), the Schedule of Funding Progress – Other Post‐Employment Benefits –
Defined Benefit Health Care Plan (on page 94), the Schedules of City’s Proportionate Share of the Net Pension
Liability (on page 95), and the Schedules of City Contributions (on page 96), be presented to supplement the basic
financial statements. Such information, although not a part of the basic financial statements, is required by the
Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing
the basic financial statements in an appropriate operational, economic, or historical context. We have applied
certain limited procedures to the required supplementary information in accordance with auditing standards
generally accepted in the United States of America, which consisted of inquiries of management about the methods
of preparing the information and comparing the information for consistency with management’s responses to our
inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial
statements. We do not express an opinion or provide any assurance on the information because the limited
procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the City’s basic financial statements. The introductory section, the combining and individual nonmajor
fund financial statements, the Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and
Actual – Municipal Accommodations Fee Fund, and the statistical section are presented for purposes of additional
analysis and are not a required part of the basic financial statements. The Uniform Schedule of Court Fines,
Assessments and Surcharges (per ACT 96) is presented for purposes of additional analysis as required by the State of
South Carolina, and is not a required part of the basic financial statements.

2

The combining and individual nonmajor fund financial statements, the Schedule of Revenues, Expenditures and
Changes in Fund Balance – Budget and Actual – Municipal Accommodations Fee Fund, and the Uniform Schedule of
Court Fines, Assessments and Surcharges (per ACT 96) are the responsibility of management and were derived from
and relate directly to the underlying accounting and other records used to prepare the basic financial statements.
Such information has been subjected to the auditing procedures applied in the audit of the basic financial
statements and certain additional procedures, including comparing and reconciling such information directly to the
underlying accounting and other records used to prepare the basic financial statements or to the basic financial
statements themselves, and other additional procedures in accordance with auditing standards generally accepted
in the United States of America. In our opinion, the combining and individual nonmajor fund financial statements,
the Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual – Municipal
Accommodations Fee Fund, and the Uniform Schedule of Court Fines, Assessments and Surcharges (per ACT 96) are
fairly stated, in all material respects, in relation to the financial statements as a whole.
The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of
the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated June 27, 2018 on our
consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain
provisions of laws, regulations, contracts, grant agreements and other matters. The purpose of that report is to
describe the scope of our testing of internal control over financial reporting and compliance and the results of that
testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is
an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s
internal control over financial reporting and compliance.

Columbia, South Carolina
June 27, 2018

3

MANAGEMENT’S DISCUSSION AND ANALYSIS
(Required Supplementary Information)

CITY OF CHARLESTON, SOUTH CAROLINA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2017

As management of the City of Charleston, South Carolina (the City), we offer readers of the City’s financial
statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended
December 31, 2017. We encourage readers to consider the information presented here in conjunction with
additional information that we have furnished in our letter of transmittal, which can be found in the preceding
Introductory Section.
FINANCIAL HIGHLIGHTS
 The City implemented GASB Statement No. 68, Accounting and Financial Reporting for Pensions, in 2015.
GASB 68 continued to have a significant effect on the financial statements during 2017 as the end of year
balances for net pension liability in the governmental activities and business‐type activities increased by
$13,105,109 and $266,292, respectively. Additionally, unrestricted net position for the government as a
whole remains a deficit due to the 2015 decrease in the amount of $128,650,786 as a result of the
implementation of GASB 68.
 The assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows of
resources at December 31, 2017, by $849,843,334 (net position). The City’s unrestricted net position
deficit was $(97,941,335).
 The City’s total net position increased by $70,166,997 during the fiscal year ended December 31, 2017,
with a $62,435,113 increase resulting from governmental activities and a $7,731,884 increase resulting
from business‐type activities.
 As of the close of the current fiscal year, the City’s governmental funds reported combined ending fund
balances of $278,542,827, an increase of $29,280,888 from the prior year. Approximately 13 percent of
the total amount, $36,391,210, is available for spending at the City’s discretion (unassigned fund balance).
 At the end of the current fiscal year, unrestricted fund balance (the total of the committed, assigned and
unassigned components of fund balance) for the General Fund was $63,001,370, or approximately 38
percent of 2017 total General Fund expenditures.
OVERVIEW OF THE FINANCIAL STATEMENTS
The discussion and analysis provided here are intended to serve as an introduction to the City’s basic financial
statements. The City’s basic financial statements consist of three components: 1) government‐wide financial
statements, 2) fund financial statements, and 3) the notes to the financial statements. This report also includes
supplementary information intended to furnish additional detail to support the basic financial statements
themselves.
Government‐wide Financial Statements. The government‐wide financial statements are designed to provide
readers with a broad overview of the City’s finances, in a manner similar to a private‐sector business.
The statement of net position presents financial information on all of the City’s assets, liabilities, and deferred
inflows/outflows of resources, with the difference reported as net position. Over time, increases or decreases in
net position may serve as a useful indicator of whether the financial position of the City is improving or
deteriorating.
The statement of activities presents information showing how the City’s net position changed during the most
recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change
occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported for some items
that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation
leave).

4

CITY OF CHARLESTON, SOUTH CAROLINA
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 2017

Both of the government‐wide financial statements distinguish functions of the City that are principally supported
by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to
recover all or a significant portion of their costs through user fees and charges (business‐type activities). The
governmental activities of the City include the broad functions of general government, public safety, public
service, urban and community development, culture and recreation, community promotions, health and welfare,
and business development and assistance. The business‐type activities of the City include Parking Facilities and
various other smaller enterprise funds including the City Market, the Joseph P. Riley, Jr. Baseball Park and the
Municipal Golf Course.
The government‐wide financial statements can be found on pages 17 through 20 of this report.
Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain control over
resources that have been segregated for specific activities or objectives. The City, like other state and local
governments, uses fund accounting to ensure and demonstrate compliance with finance‐related legal
requirements. All the funds of the City can be divided into three categories: governmental funds, proprietary
funds and fiduciary funds.
 Governmental Funds – Governmental funds are used to account for essentially the same functions reported
as governmental activities in the government‐wide financial statements. However, unlike the government‐
wide financial statements, governmental fund financial statements focus on near‐term inflows and outflows
of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year.
Such information may be useful in evaluating a government’s near‐term financing requirements.
Because the focus of governmental funds is narrower than that of the government‐wide financial statements,
it is useful to compare the information presented for governmental funds with similar information presented
for governmental activities in the government‐wide financial statements. By doing so, readers may better
understand the long‐term impact of the City’s near‐term financing decisions. Both the governmental funds
balance sheet and the governmental funds statement of revenues, expenditures and changes in fund balances
provide a reconciliation to facilitate this comparison between governmental funds and governmental
activities.
The City maintains 26 individual governmental funds. Information is presented separately in the
governmental funds balance sheet and in the governmental funds statement of revenues, expenditures and
changes in fund balances for the General Fund, the Capital Improvements Fund, the King Street Gateway TIF
Fund, the Drainage Fund and the International African American Museum Fund, which are considered to be
major funds. Data from the other 21 governmental funds are combined into a single aggregated presentation.
Individual fund data for each of these nonmajor governmental funds is provided in the form of combining
statements in the combining and individual fund statements and schedules section of this report.
The City adopts an annual appropriated budget for its General Fund. A budgetary comparison statement has
been provided for the General Fund to demonstrate compliance with this budget.
The basic governmental fund financial statements can be found on pages 21 through 32 of this report.

5

CITY OF CHARLESTON, SOUTH CAROLINA
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 2017

 Proprietary Funds – Proprietary (enterprise) funds are used to report the same functions presented as
business‐type activities in the government‐wide financial statements. Proprietary funds provide the same
type of information as the government‐wide financial statements, only in more detail. The proprietary
fund financial statements provide separate information for the Parking Facilities Fund, which is considered
to be a major fund of the City. Data from the remaining 6 enterprise funds are combined into a single
aggregated presentation. Individual fund data for each of these nonmajor enterprise funds is provided in
the form of combining statements in the combining and individual fund statements and schedules section
of this report.
The basic proprietary funds financial statements can be found on pages 33 through 37 of this report.
 Fiduciary Funds – Fiduciary funds are used to account for resources held for the benefit of parties outside
of the government. Fiduciary funds are not reported in the government‐wide financial statements
because the resources of those funds are not available to support the City’s own programs. The
accounting used for fiduciary funds is much like that used for proprietary funds.
The fiduciary fund financial statement provides information for the Firemen’s Insurance and Inspection
Fund, an agency fund for which the City acts as custodian. The City is responsible for ensuring that the
assets reported in this fund are used for their intended purpose. A brief description of this fund and
individual fund data for this agency fund is provided in the combining and individual fund statements and
schedules section of this report.
The fiduciary fund financial statement can be found on page 38 of this report.
Notes to the Financial Statements – The notes provide additional information that is necessary to acquire a
full understanding of the data provided in the government‐wide and fund financial statements. The notes to
the financial statements can be found on pages 39 through 93 of this report.
Other Information – In addition to the basic financial statements and accompanying notes, this report also
presents required supplementary information concerning the City’s progress in funding its obligation to
provide pension and other postemployment benefits (OPEB) to its employees. Required supplementary
information can be found on pages 94 through 96 of this report.
The combining and individual statements and schedules referred to earlier in connection with nonmajor funds
are presented following the required supplementary information on pensions and OPEB, and can be found on
pages 97 through 114 of this report. The Municipal Accommodations Fee Fund budgetary comparison
schedule is also included therein. As required by the State, the City also presents a Uniform Schedule of Court
Fines, Assessments and Surcharges found on pages 115 and 116. Finally, the statistical section is presented
on pages 117 through 145.

6

CITY OF CHARLESTON, SOUTH CAROLINA
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 2017

GOVERNMENT‐WIDE OVERALL FINANCIAL ANALYSIS
As noted earlier, net position over time may serve as a useful indicator of a government’s financial position. In
the case of the City, assets and deferred outflows of resources exceeded liabilities and deferred inflows of
resources by $849,843,334 at December 31, 2017.
By far the largest portion of the City’s net position (93 percent) reflects its investment in capital assets (e.g., land,
infrastructure, buildings, machinery and equipment), less any related outstanding debt that was used to acquire
those assets. The City uses these capital assets to provide a variety of services to its citizens. Accordingly, these
assets are not available for future spending. Although the City’s investment in capital assets is reported net of
related debt, it should be noted that the resources used to repay this debt must be provided from other sources,
since the capital assets themselves cannot be used to liquidate these liabilities.
An additional portion of the City’s net position (19 percent) represents resources that are subject to external
restrictions on how they may be used. The remaining portion is a deficit balance of $(97,941,335) of unrestricted
net position, which is a decrease of $29,552,510 from the prior year. This deficit occurred because of the
implementation of GASB 68, as mentioned previously, which required a restatement of net position in 2015 in the
amount of $(128,650,786).
At the end of the current fiscal year, the City is able to report positive balances in all three categories of net
position for its separate business‐type activities, but only two of the three categories for the City as a whole, as
well as for its separate governmental activities. This was also the case at the end of the prior fiscal year.
City of Charleston’s Net Position
Governmental
Activities
2017
2016
Current and other assets $ 341,256,737
Capital assets
810,037,990
Total assets
1,151,294,727
Total deferred outflows
of resources
Long‐term liabilities
outstanding
Other liabilities
Total liabilities
Total deferred inflows
of resources
Net position:
Net investment in
capital assets
Restricted
Unrestricted
Total net position

Business‐type
Activities
2017
2016

Total
2017

2016

$ 301,488,459
748,128,122
1,049,616,581

$ 48,757,569
111,345,023
160,102,592

$ 23,084,417
110,213,777
133,298,194

$ 390,014,306
921,383,013
1,311,397,319

$ 324,572,876
858,341,899
1,182,914,775

29,209,863

24,754,023

811,603

821,775

30,021,466

25,575,798

385,008,050
51,886,205
436,894,255

348,549,793
44,795,375
393,345,168

52,276,199
2,157,774
54,433,973

34,094,808
1,287,476
35,382,284

437,284,249
54,043,979
491,328,228

382,644,601
46,082,851
428,727,452

230,654

80,868

16,569

5,916

247,223

86,784

85,754,420

20,709,233
$ 106,463,653

81,718,915

17,012,854
$ 98,731,769

703,999,111
158,031,138
(118,650,568)
$ 743,379,681

650,137,856
116,208,391
(85,401,679)
$ 680,944,568

789,753,531
158,031,138
(97,941,335)
$ 849,843,334

731,856,771
116,208,391
(68,388,825)
$ 779,676,337

The City’s overall net position improved and net position increased by $70,166,997 or 9 percent during 2017. The
reasons for this overall increase are discussed in the following sections for governmental activities and business‐
type activities.
7

CITY OF CHARLESTON, SOUTH CAROLINA
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 2017

City of Charleston’s Changes in Net Position
Governmental
Activities
2017
2016
REVENUES:
Program revenues:
Charges for services
Operating grants and
contributions
Capital grants and contributions
General revenues:
Property taxes, including tax
increment financing districts
Other taxes and fees
Grants and contributions not
restricted
Gain on disposal of capital assets
Other revenues
Total revenues

Business‐type
Activities
2017
2016

Total
2017

2016

$ 56,205,729

$ 51,412,941

$ 30,397,387

$ 29,411,923

$ 86,603,116

$ 80,824,864

5,866,757
36,646,019

3,880,261
29,265,913

27,506
2,085,625

18,754


5,894,263
38,731,644

3,899,015
29,265,913

91,527,300
46,103,369

83,910,174
44,878,529







91,527,300
46,103,369

83,910,174
44,878,529

24,367,591
2,504,106
4,708,938
267,929,809

23,266,387
4,442,574
3,723,684
244,780,463


8,325
79,795
32,598,638


13,491
54,671
29,498,839

24,367,591
2,512,431
4,788,733
300,528,447

23,266,387
4,456,065
3,778,355
274,279,302

55,455,672
94,022,061
13,843,530

48,107,663
89,069,626
13,226,338









55,455,672
94,022,061
13,843,530

48,107,663
89,069,626
13,226,338

7,018,652
29,211,827
3,298,598
1,220,745

6,875,018
23,973,584
3,568,534
1,123,254











7,018,652
29,211,827
3,298,598
1,220,745

6,875,018
23,973,584
3,568,534
1,123,254

969,762
4,832,991







209,873,838

929,369
4,705,440







191,578,826



13,547,603
1,909,907
272,843
1,040,845
1,517,987
1,944,347
254,080
20,487,612



12,839,344
1,922,125
255,981
1,002,688
1,434,879
1,825,625
246,463
19,527,105

969,762
4,832,991
13,547,603
1,909,907
272,843
1,040,845
1,517,987
1,944,347
254,080
230,361,450

929,369
4,705,440
12,839,344
1,922,125
255,981
1,002,688
1,434,879
1,825,625
246,463
211,105,931

Excess before transfers
Transfers

58,055,971
4,379,142

53,201,637
1,246,025

12,111,026
(4,379,142)

9,971,734
(1,246,025)

70,166,997


63,173,371


Increase in net position

62,435,113

54,447,662

7,731,884

8,725,709

70,166,997

63,173,371

Net position, beginning

680,944,568

626,496,906

98,731,769

90,006,060

779,676,337

716,502,966

$743,379,681

$680,944,568

$106,463,653

$ 98,731,769

$849,843,334

$779,676,337

EXPENSES:
General government
Public safety
Public service
Urban and community
development
Culture and recreation
Community promotions
Health and welfare
Business development and
assistance
Interest and fiscal charges
Parking Facilities
City Market
Angel Oak
Charleston Visitor Center
Joseph P. Riley, Jr. Baseball Park
Municipal Golf Course
Slave Mart Museum
Total expenses

Net position, ending

8

CITY OF CHARLESTON, SOUTH CAROLINA
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 2017

Governmental Activities. During the current fiscal year, governmental activities increased the City’s net position
by $62,435,113 from the prior year for an ending balance of $743,379,681. This compares to a prior year increase
of $54,447,662, a difference of $7,987,451. Key elements of this change are as follows:
 Program revenues increased $14,159,390 or 17 percent, compared to a prior year increase of only
$239,216. This was driven by capital grants and contributions which increased by $7,380,106 or 25
percent in 2017, primarily due to $9,499,425 of State Infrastructure Bank grants relating to Phase 3 of the
Spring Fishburne drainage project on US Highway 17. Charges for services were also up by $4,792,788 or
9 percent over the prior year. This was mainly a result of higher business licenses ($3,474,330 or 11
percent) due to expanded collection and enforcement activities.
 General revenues and transfers increased $12,123,073 or 8 percent during 2017 primarily due to
increased tax increment financing (TIF) revenues, as well as transfers in from business‐type activities.
Property tax revenues from TIF districts were up 41 percent ($3,698,311), primarily the result of 2 new
TIF districts: the Cooper River Bridge Redevelopment TIF ($1,909,509) and the Horizon/WestEdge
Redevelopment TIF ($488,632). Net transfers in to governmental activities increased by $3,133,117, an
increase of 251 percent. This was due in part to a budgeted transfer from the Parking Facilities Fund of
$6,572,573, an increase of $1,445,317 over the prior year resulting from growth in Parking Fund revenues.
 Expenses for governmental activities increased $18,295,012 or 10 percent over the prior year. This was
primarily due to general government expenses increasing by $7,348,009 or 15 percent in 2017.
Contributing to this increase were $3,687,893 of new energy performance costs relating to a new Johnson
Controls contract; increased healthcare costs of $1,058,916; higher drainage repair costs of $1,219,587
due to increased rainfall, tropical activity and aging infrastructure; and increased OPEB contribution
expense of $1,161,633.

Program Revenues and Expenses – Governmental Activities
$100,000,000
$90,000,000
Program revenues

$80,000,000

Expenses

$70,000,000
$60,000,000
$50,000,000
$40,000,000
$30,000,000
$20,000,000
$10,000,000
$0

General
government

Public safety

Public service

Urban &
community
development

Culture &
recreation

9

Community
promotions

Health & welfare

Business
Interest & fiscal
development &
charges
assistance

CITY OF CHARLESTON, SOUTH CAROLINA
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 2017

Revenues by Source ‐ Governmental Activities
Other
Grants & contributions not related to
specific programs
Hospitality, accommodations &
franchise
Property taxes, including tax
increment financing districts

2017
2016

Capital grants & contributions

Operating grants & contributions

Charges for services


10

20

30

40

50
60
Millions

70

80

90

100

Expenses by Function ‐ Governmental Activities
Interest & fiscal charges
Business development &
assistance
Health & welfare
Community promotions
Culture & recreation
2017
2016

Urban & community development
Public service
Public safety
General government


10

20

30

40

50

60

70

80

90

100

Millions

Business‐Type Activities. Business‐type activities increased the City’s net position in 2017 by $7,731,884. This
compares to a prior year increase of $8,725,709. This ($993,825) fluctuation was largely due to a budgeted
$1,445,317 increase in transfers from business‐type activities (Parking Facilities) to governmental activities during
2017.

10

CITY OF CHARLESTON, SOUTH CAROLINA
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
FOR THE YEAR ENDED DECEMBER 31, 2017

FINANCIAL ANALYSIS OF THE CITY’S FUNDS
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance‐related legal
requirements.
Governmental Funds
The focus of the City’s governmental funds is to provide information on near‐term inflows, outflows and balances
of spendable resources. Such information is useful in assessing the City’s financing requirements. In particular,
unassigned fund balance may serve as a useful measure of a government’s net resources available for
discretionary use as it represents the portion of fund balance which has not yet been limited to use for a particular
purpose by either an external party, the City itself, or a group or individual that has been delegated authority to
assign resources for use for particular purposes by City Council.
At December 31, 2017, the City’s governmental funds reported combined fund balances of $278,542,827, an
increase of $29,280,888 in comparison with the prior year. Approximately 13 percent of this amount
($36,391,210) constitutes unassigned fund balance, which is available for spending at the government’s
discretion. The remainder of the fund balance is either nonspendable, restricted, committed or assigned to
indicate that it is 1) not in spendable form ($836,080), 2) restricted for particular purposes ($200,253,726), 3)
committed for particular purposes ($‐0‐), or 4) assigned for particular purposes ($41,061,811).
General Fund. The General Fund is the chief operating fund of the City. At the end of the current fiscal year,
unassigned fund balance of the General Fund was $36,391,210, while total fund balance increased to $63,837,633.
As a measure of the General Fund’s liquidity, it may be useful to compare both unassigned fund balance and total
fund balance to total General...

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Tutor went the extra mile to help me with this essay. Citations were a bit shaky but I appreciated how well he handled APA styles and how ok he was to change them even though I didnt specify. Got a B+ which is believable and acceptable.

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