City financial report shows 15% increase in total assets and tax revenue growth

In the heart of Fairhope's city hall, council members gathered on April 29, 2025, to dissect the city's financial health, revealing a landscape of growth and challenges. The meeting, marked by a detailed financial report, showcased a significant increase in total assets, which now stand at $355.3 million—up approximately 15% from the previous year. However, this positive news was tempered by a notable rise in liabilities, which climbed to $77.2 million, reflecting a 34.6% increase.

The city’s net position, a crucial indicator of financial stability, reached $278 million, marking an 11.4% increase. This growth was largely attributed to unspent bond proceeds from the 2024 water and sewer warrants, contributing to a total cash increase of $17.9 million, bringing the cash reserves to $88.1 million.

As the council delved deeper into the numbers, they noted that capital assets rose to $244 million, bolstered by $39 million in current year additions, primarily from water and sewer improvements. However, the city also faced challenges, with accounts payable increasing by $1 million, largely due to expenditures related to waterfront and sewer upgrades.

The discussion also highlighted a decrease in unearned revenue, down by $900,000, linked to the completion of water project deposits. Notably, the city’s direct placements surged by $23.3 million, attributed to the issuance of new warrants.

As the meeting progressed, council members examined governmental revenues, revealing a $1.5 million increase in property taxes, driven by rising property values. Sales tax revenue also saw a modest increase of $520,000, aided by state remittances from online sales. However, the city experienced a decline in licenses and permits, down by $600,000, following a strategic pullback from police jurisdiction.

The financial report concluded with a promising note on intergovernmental revenue, which surged by $5.4 million, largely due to funding from the Gulf Coast Oil Spill project. As the council wrapped up, the discussions underscored the delicate balance between growth and fiscal responsibility, setting the stage for future decisions that will shape Fairhope's financial landscape.