This page intentionally left blank Annual Comprehensive Financial Report of the City of Chesapeake, Virginia for Fiscal Year Ended June 30, 2022 Prepared by the Chesapeake Department of Finance Nancy C. Tracy, Director City of Chesapeake, Virginia Mission The employees of the City of Chesapeake are committed to providing quality service to all Citizens equitably, in a responsive and caring manner. Code of Ethics We, the employees of the City of Chesapeake, are committed to the highest standards of ethical conduct that reflect: Responsibility, Honesty, Respect, Fairness, Compassion, Integrity, and Loyalty Acknowledgments… The preparation of this report has been accomplished by the efficient and dedicated services of the staff of the Department of Finance and various departments who have been assisted by the independent auditors, Cherry Bekaert LLP. The contributions of all are invaluable and sincerely appreciated and clearly reflect the high standards which have been set by the City of Chesapeake. The following Finance employees were instrumental in the preparation of this report: Kristen Bailey Nicole Griffith Nancy Randall Lisa Blackford Denise Henderson Nancy Tracy Lorra Calvert Linda Mathis Tamara Walters Evellyn Chesley Amanda McAdams Katherine Williams Melinda Commander Doria McConnell Matthew Wong Susan Evans It is also appropriate to thank the City Manager, Mayor, and Members of City Council for making possible the excellent financial position of the City through their interest and support in planning and conducting the financial affairs of the City. Please visit us at: www.cityofchesapeake.net CITY OF CHESAPEAKE, VIRGINIA Table of Contents June 30, 2022 Page Schedule Number INTRODUCTORY SECTION: Letter of Transmittal I City Wide Organizational Chart XV City Officials XVI GFOA Certificate of Achievement XVIII FINANCIAL SECTION: Report of Independent Auditor 1 Basic Financial Statements: Government-Wide Financial Statements: Fund Financial Statements: Governmental Funds Financial Statements: Proprietary Funds Financial Statements: Fiduciary Funds Financial Statements: Other Discretely Presented Component Units: Management’s Discussion and Analysis (MD&A) 7 Statement of Net Position A 26 Statement of Activities B 27 Balance Sheet C 32 Statement of Revenues, Expenditures, and Changes in Fund Balances D 34 Statement of Net Position E 38 Statement of Revenues, Expenses, and Changes in Net Position F 39 Statement of Cash Flows G 40 Statement of Fiduciary Net Position H 42 Statement of Changes in Fiduciary Net Position I 43 Combining Statement of Net Position J-1 46 Combining Statement of Activities J-2 47 Notes to Basic Financial Statements: K 51 1.Summary of Significant Accounting Policies51 2.Deposits and Investments62 3.Accounts Receivable and Payable67 4.Capital Assets70 5.Deferred Outflows and Inflows of Resources78 6.Long-Term Obligations81 7.Advances and On Behalf Of Payments90 8.Interfund Balances and Transfers90 9.Leases92 10.Retirement Plans94 11.Other Postemployment Benefits112 12.Fund Balances132 13.Deferred Compensation Plan135 14.Commitments135 15.Related Parties137 iCITY OF CHESAPEAKE, VIRGINIA Table of Contents, Continued June 30, 2022 Page Schedule Number FINANCIAL SECTION (Continued : Notes to Basic Financial Statements (Continued): 16. Contingent Liabilities 140 17. Fund Results and Reconciliation 144 18. Subsequent Events 144 19. Accounting Pronouncements 145 Required Supplementary Information Other Than MD&A: Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual – General Fund L-1 148 Schedule of Employer Contributions – Virginia Retirement System L-2 149 Schedule of Changes in the Net Pension Liability and Related Ratios – City L-3 150 Schedule of Changes in the Net Pension Liability and Related Ratios – Schools L-4 152 Schedule of Employer’s Share of Net Pension Liability L-5 154 Schedules of Employer Contributions – Other Postemployment Benefits - City and Schools Directed L-6 155 Schedule of Changes in the Net OPEB Liability (Asset) and Related Ratios – City L-7 156 Schedule of City of Chesapeake Proportionate Share of Net OPEB Liability – VRS Directed Programs L-8 157 Schedule of Changes in the Net OPEB Liability (Asset) and Related Ratios – Schools L-9 158 Schedule of City of Chesapeake Schools Proportionate Share of Net OPEB Liability – VRS Directed Programs L-10 159 Schedules of Employer Contributions – Other Postemployment Benefits – VRS Directed L-11 160 Notes to Required Supplementary Information L-12 162 Other Supplementary Information: Combining and Individual Fund Schedules: Governmental Funds: Major Governmental Funds: General Fund: Schedule of Revenues and Other Financing Sources – Budget and Actual M-1 172 Schedule of Expenditures, Encumbrances, and Other Financing Uses – Budget and Actual M-2 176 Debt Service Fund: Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual N 181 Capital Projects Funds: General Capital Projects Fund: Schedule of Expenditures and Encumbrances – Budget and Actual O-1 184 Public Utilities Capital Projects Fund: Schedule of Expenditures and Encumbrances – Budget and Actual O-2 190 iiCITY OF CHESAPEAKE, VIRGINIA Table of Contents, Continued June 30, 2022 Page Schedule Number FINANCIAL SECTION (Continued : Capital Projects Funds: Chesapeake Transportation System Capital Projects Fund: Schedule of Expenditures and Encumbrances – Budget and Actual O-3 193 Stormwater Management Capital Projects Fund: Schedule of Expenditures and Encumbrances – Budget and Actual O-4 194 Nonmajor Governmental Funds: Special Revenue and Permanent Funds: Combining Balance Sheet P-1 198 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances P-2 202 Tax Increment Financing Greenbrier Fund: Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual P-3 206 Tax Increment Financing South Norfolk Fund: Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual P-4 207 Virginia Public Assistance Fund: Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual P-5 208 Integrated Behavioral Healthcare Fund: Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual P-6 209 Conference Center Fund: Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual P-7 210 Juvenile Services Fund: Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual P-8 211 Interagency Consortium Fund: Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual P-9 212 E-911 Operations Fund: Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual P-10 213 Fee Supported Activities Fund: Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual P-11 214 Internal Service Funds: Combining Statement of Net Position Q-1 216 Combining Statement of Revenues, Expenses, and Changes in Net Position Q-2 217 Combining Statement of Cash Flows Q-3 218 iiiCITY OF CHESAPEAKE, VIRGINIA Table of Contents, Continued June 30, 2022 Page Schedule Number FINANCIAL SECTION (Continued : Chesapeake Public Schools Component Unit: Governmental Funds: Balance Sheet R-1 221 Schedule of Revenues, Expenditures, and Changes Fiduciary Funds Financial Statements: Schedule of Revenues, Expenditures, and Changes in Schedule of Revenues, Expenditures, and Changes in Schedule of Revenues, Expenditures, and Changes in Other Component Unit: Statement of Revenues, Expenditures, and Changes in in Fund Balance R-2 222 Statement of Fiduciary Net Position R-3 224 Statement of Changes in Fiduciary Net Position R-3A 225 Fund Balance – Budget and Actual – Schools General Fund R-4 226 Fund Balance – Budget and Actual – Schools Nutrition Services Fund R-5 227 Fund Balance – Budget and Actual – Schools Textbooks Fund R-6 228 Balance Sheet and Statement of Net Position S-1 230 Fund Balance – Chesapeake Mosquito Control Commission S-2 231 STATISTICAL SECTION: Financial Trends Information: Net Position by Component Table 1 234 Revenue Capacity Information: Debt Capacity Information: Ratio of Annual Debt Expenditures for General Obligation Revenue Bond Coverage Changes in Net Position Table 2 236 Fund Balances, Governmental Funds Table 3 243 Statement of Changes in Fund Balances, Governmental Funds Table 4 244 Assessed and Estimated Actual Value of Taxable Property Table 5 246 Direct and Overlapping Property Tax Rates Table 6 247 Principal Property Taxpayers Table 7 248 Property Tax Levies Table 8 249 Property Tax Levies and Collections Table 9 251 Ratios of Outstanding Debt by Type Table 10 252 Ratios of Outstanding General Bonded Debt Table 11 254 Debt Affordability Indicators Table 12 255 Bonded Debt to Total General Governmental Expenditures Table 13 256 Ratio of Bonded Debt Expenditures to Local Revenues Table 14 257 Legal Debt Margin Information Table 15 258 Water and Sewer Systems and Chesapeake Transportation System Table 16 259 ivCITY OF CHESAPEAKE, VIRGINIA Table of Contents, Continued June 30, 2022 Schedule Page Number STATISTICAL SECTION (Continued : Demographic and Economic Information: Demographic and Economic Statistics Principal Employers Operating Information: Municipal Employment Statistics Authorized Full-time Equivalent City Government Employee Positions by Department Operating Indicators by Function/Program Capital Asset Statistics by Function/Program Table 17 Table 18 Table 19 Table 20 Table 21 Table 22 260 261 262 263 264 266 COMPLIANCE SECTION: Schedule of Expenditures of Federal Awards Notes to Schedule of Expenditures of Federal Awards Report of Independent Auditor on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards Report of Independent Auditor on Compliance for each Major Federal Program and on Internal Control over Compliance Required by the Uniform Guidance Schedule of Findings and Questioned Costs T-1 T-2 269 274 275 277 279 vNext >