Savanna is the older city within the State of Georgia with a population of a little of 145,000 people, which makes it the third-most populous city in the state. The city enjoys one of the most diverse economic bases not only within the state but also in the country, which has played a crucial role in building its financial capacity. Some of the leading industries that are located within the city include manufacturing and tourism, which account for a significant part of the city's financial positioning. The unemployment rate in Savanna is 5.0%, which is higher when compared to the national average of 4.7% and much lower when compared to the average within the State of Georgia, which is 5.5%. An evaluation of the 2015-16 financial statement (attached in the appendix) indicates that the fastest-growing category of expenditures in the city was community development and workforce training. In 2015, the city used $14.336 million in the area of community development and workforce training, which increased to $28.383 million in 2016 (City of Savanna, 2016). That suggests a growth of almost 100% in the expenditure by the city management towards promoting community development and training of the workforce within the city, which is much higher when compared any other category of expenditure. One of the most notable revenue categories for the city, in terms of collection capacity, is the general property tax, which is one of the central charges that are imposed by the local government. From the city’s financial statement, the general property tax collected in 2016 was $67.569 million when compared to a total revenue base of $257.585 million collected in the same period. From this perspective, it is clear that the general property tax accounts for 26.23% of the total revenue collected within the city. The existing capacity of refunding or reorganizing existing debt organization within Savanna City is notably high attributed to the fact that the city is in a sound financial position. An analysis of the city’s expenditure suggests that it has been able to maximize its ability to refund debt organizations as one of the ways through which to improve on its financial positioning. That has had a significant impact on highlighting Savanna as a city that is well managed from a financial point of view when compared to some of the cities within the state and country. The primary funding alternative to help in supporting its debt obligation is increasing taxation within the city, primarily focusing on the two primary tax categories, which are general property and general sales taxes. Increased taxation is one of the vital funding alternatives that governments are expected to consider in trying to improve the amounts collected (Thøgersen, 2010). By strengthening these taxes, the city would be in a better position through which to ensure that it can effectively support its debt obligations without impacting on its financial positioning. Another essential alternative would involve reducing its expenditures, especially in areas such as public safety and facilities maintenance. Booth, Bourne, Meakin, Minford, Minford, & Smith (2016) indicate that reduced government expenditure would have a direct impact on ensuring that the government can capitalize on its budget effectively. An analysis of the 2015-16 financial statement indicates that the fastest-growing category of expenditures in the city was community development and workforce training, which had a growth of almost 100% in the spending by the city management during that period. The general property tax accounts for 26.23% of the total revenue collected within the city, which is the highest revenue category for the city. The two main funding alternatives that the city may consider are increased taxes and reduced expenditures.
References
Booth, P., Bourne, R., Meakin, R., Minford, L., Minford, P., & Smith, D. B. (2016). Taxation, Government Spending and Economic Growth. London Publishing Partnership.
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The city of Savanna. (2016). Comprehensive Annual Financial Report: Year Ended December 31, 2016. Retrieved from https://www.savannahga.gov/DocumentCenter/View/10502/2016-CAFR
Thøgersen, J. (2010). Unemployment, Public Pensions, and Capital Accumulation: Assessing Growth Effects of Alternative Funding Strategies. Journal of Institutional and Theoretical Economics JITE, 166 (3), 502-520.
