Annual report, 2020

2020 ANNUAL REPORT
GEORGIA ENVIRONMENTAL FINANCE AUTHORITY

Our Mission
To Conserve and Improve Georgia's Energy, Land, and Water Resources.
Founded in 1985, the Georgia Environmental Finance Authority (GEFA) directs programs that improve Georgia's environment, protect natural resources, and promote economic development. GEFA provides loans for water, wastewater, and solid waste infrastructure; manages energy efficiency and renewable energy programs; administers land conservation loans; and monitors state-owned fuel storage tanks.
To date, GEFA has provided more than $4.6 billion in low-interest loans to cities, counties, and infrastructure authorities for more than 1,900 projects that improve water, wastewater, stormwater, and solid waste systems.
Table Of Contents
3 Executive Director's Report 4 Accomplishments 6 Energy Resources 8 Water Resources 10 Financial Highlights 11 Net Position 12 Statement of Net Position 13 Statement of Activities 14 Revenues and Expenses 15 Division Summaries 15 Board of Directors 15 Senior Staff

GEORGIA ENVIRONMENTAL FINANCE AUTHORITY | 3
Executive Director's Report
To the Governor, Members of the General Assembly, and Georgia Citizens:
The Georgia Environmental Finance Authority (GEFA) is committed to serving the residents of Georgia. GEFA meets this commitment by helping communities conserve and improve Georgia's energy, land, and water resources. To date, GEFA has provided more than $4.6 billion in low-interest loans for improvements to the water, wastewater, stormwater, and solid waste systems of cities, counties, and infrastructure authorities across Georgia. In recent years, several severe weather events affected many rural communities throughout our state. During the storms, GEFA worked behind the scenes to ensure Georgians had access to energy and water resources. To further assist communities in times of need, we worked with the Georgia Rural Water Association on a program to provide mobile generators. The generators supply temporary power to drinking water wells and wastewater treatment plants for rural communities in the aftermath of storms or other natural disasters. The generator program is an example of two organizations coming together to help citizens in a time of need. GEFA was created, in part, to help smaller communities make infrastructure improvements by providing below-market financing. In FY2020, the town of Braselton received a $580,000 Clean Water State Revolving Fund loan to help finance improvements to the town's stormwater system. Braselton received an interest rate reduction because it is a WaterFirst Community. The city of Cairo received a $2.25 million Drinking Water State Revolving Fund loan to help finance replacing water main. The city received an interest rate reduction for this conservation project. These two projects are examples of communities investing in infrastructure improvements while taking full advantage of GEFA's low-interest rates. At the onset of the COVID-19 pandemic, the Office of Governor Brian P. Kemp and Georgia state agencies immediately took action to protect the health and well-being of Georgians. For GEFA employees, we quickly ramped up our remote working capabilities and implemented COVID-19 protocols in our office. For GEFA borrowers, and at the direction of the governor's office, we provided a loan payment deferral period of six months. The deferral period provided a temporary relief of approximately $68 million in loan repayments for more than 330 borrowers. In this report, you will see more examples of how GEFA fulfills our mission to help conserve and improve Georgia's energy, land, and water resources. Our work would not be possible without the support of the governor, state and local leaders, and other state agencies.
Sincerely,
Kevin Clark, Executive Director

Accomplishments
FISCAL YEAR 2020
GEFA increases the capacity and quality of Georgia's water supply, supports the protection and preservation of Georgia's land resources, and promotes conservation and advancement of Georgia's energy resources. The agency continues to build on this success through its commitment to protecting Georgia's natural resources and supporting economic development.

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Conserving Georgia's Energy Resources
Forty K-12 and higher education building operators received Building Operator Certification training.
Six Georgia Solar contracts totaling $223,728 were executed to install small-scale solar photovoltaic systems and to increase renewable energy education.
The State Energy Program procured nine alternative fuel mobile generators for the Georgia Rural Water Association.
The Weatherization Assistance Program weatherized 683 homes positively impacting 1,197 Georgians with an estimated energy savings of 20,831 MBtu.
The Fuel Storage Tank Program provided oversight and monitoring services for 630 fuel storage tanks at 23 state agencies and departments.
GEFA helped its agency partners pass 29 fuel storage tank site compliance inspections.
GEFA completed the annual registration for 324 state-owned underground fuel storage tanks.

Improving Georgia's Water Resources
Projects financed by GEFA provided reliable water, wastewater, and solid waste services to more than 1 million Georgians.
The Clean Water State Revolving Fund awarded 20 loans totaling $94.8 million.
The Drinking Water State Revolving Fund (DWSRF) awarded 42 loans totaling $74.4 million.
The Georgia Fund awarded 13 loans totaling $18 million.
GEFA provided financing to 60 communities, with more than $16 million in debt service savings.
The DWSRF provided $27.8 million to small systems servicing fewer than 10,000 customers and $6.4 million to communities less than 3,300 customers.
Two communities received WaterFirst designations city of Jefferson and Bartow County.

Energy Resources

The Energy Resources Division promotes energy efficiency, renewable energy, and energy assurance programs to improve environmental quality and stimulate sustainable economic development.

The State Energy Program provides financial assistance and technical support for energy efficiency and renewable energy programs.
The Weatherization Assistance Program provides energy conservation measures to income-eligible households.
The Georgia Energy Challenge helps state agencies reach the program's 15 percent energy conservation goal.
Energy Performance Contracting allows the state to finance building improvements guaranteed to lower energy and water consumption.
The Energy Assurance Program works closely with the Georgia Emergency Management Agency, other state agencies, and private sector stakeholders to develop energy emergency planning resources and to lead exercises designed to ensure better emergency coordination.

GEORGIA ENVIRONMENTAL FINANCE AUTHORITY | 7

ENERGY RESOURCES HIGHLIGHT

GEFA and GRWA Partner to Help Assist Georgians
In the last few years, the state of Georgia has been hit by multiple natural disasters. Two storms in particular, Hurricanes Michael and Florence, defined the 2018 hurricane season. These two storms caused widespread power outages and other damage that is still evident to this day. Many Georgians did not have power, access to clean water, or other life necessities for weeks. This devastation led to many state agencies thinking of ways to help prevent this from happening in the future.
The Georgia Rural Water Association (GRWA) teamed up with the Georgia Environmental Finance Authority (GEFA) to provide communities hit by natural disasters with mobile power generators. GEFA worked with the U.S. Department of Energy to adapt the program to meet environmental and emission reduction goals and requirements. With these requirements, the portable Kohler natural gas generators were selected for this program.

This emergency response program staffed by GRWA operators will provide technical support during times of activation. The portable generators will power drinking water wells and wastewater treatment systems for rural and smaller communities across Georgia, and in neighboring states as part of mutual aid agreements, until power can be restored.

Water Resources

The Water Resources Division supports the development of water, wastewater, and solid waste infrastructure projects, which help protect the environment, facilitate economic development, accommodate population growth, and safeguard public health.
GEFA partners with local governments by providing loans for water, wastewater, stormwater, and solid waste infrastructure. The Water Resources Division also assists local governments with the development of reservoir and water supply projects.

The Georgia Fund is a state loan program for water, wastewater, and solid waste infrastructure.
The Georgia Reservoir Fund is a state loan program for reservoir and water supply infrastructure.
The Clean Water State Revolving Fund is a federal loan program for water quality and wastewater treatment infrastructure.
The Drinking Water State Revolving Fund is a federal loan program for drinking water infrastructure.
The Water First Program recognizes a local government's commitment to responsible water stewardship for environmental and economic benefits.

GEORGIA ENVIRONMENTAL FINANCE AUTHORITY | 9

WATER RESOURCES HIGHLIGHT

City Transforms Historic District with GEFA Funding
The Clean Water State Revolving Fund (CWSRF) provides communities with low-interest financing for a wide range of water quality infrastructure projects. In fiscal year 2020, the CWSRF provided 20 low-interest loans totaling $94.8 million to protect public health, protect valuable aquatic resources, and meet environmental standards benefiting thousands of Georgians.
The city of Madison, Georgia, has one of the largest historic districts in the state. The historic district is listed on the National Register of Historic Places and is the city's foremost tourist attraction. Maintaining this area and the land around it is very important for the community. Part of this land is known as the West Washington Gateway, and it was the most deteriorated entryway into the historic district. The Madison Downtown Development Authority completed a stormwater project financed by a $2.1 million CWSRF loan to help transform the West Washington Gateway.

Like many infrastructure projects, much of the transformation of the West Washington Gateway was not visible because a majority of the construction was underground. The other portion of this project consisted of cleaning up and protecting the land. This new green space will serve as a park for residents and visitors to the downtown area of the city.
This project demonstrates how one community is maximizing the benefits of a CWSRF low-interest loan. Improving water quality, treating and reducing the volume of stormwater, and creating passive recreation space will transform the city of Madison and welcome future economic development.

Financial Highlights
FISCAL YEAR 2020
The narrative overview and analysis of the financial activities for the fiscal year ended June 30, 2020, provides additional detail on GEFA's financial performance.
Total assets and deferred outflows of resources exceeded its liabilities and deferred inflows of resources at the close of the fiscal year by $2.5 billion (net position). Of this amount, approximately $46.4 million was from governmental activities and $2.47 billion was from business-type activities.
Total long-term liabilities experienced a net decrease of $1.6 million during 2020, the majority within governmental activities. The decrease was mostly attributable to the changes in GEFA's proportionate shares of Net OPEB and Net Pension Liabilities.
GEFA's total net position increased by $86.2 million. The net position in governmental activities decreased by $877.3 thousand while the net position of business-type activities increased $87.1 million, resulting in an overall $21.3 million decrease from the increase experienced in 2019.
Total governmental revenues increased by $3.8 million from 2019. The increased revenue is mostly attributable to increase in operating grants and contributions because of increased grant funding for program operations.
Charges for services within business-type activities decreased by $1.9 million. The decrease is primarily due to GEFA's decision to offer a six-month forbearance to its borrowers to provide financial relief for areas affected by the worldwide pandemic in 2020. The forbearance resulted in the fourth quarter's income being forgone, but the income will be recovered at the end of borrowers' amortization periods for borrowers who elected to participate.
Operating grants and contributions within business-type activities decreased by $29.8 million. The large decrease was mostly due to nonreceipt of state support for one of the loan programs. In addition, federal loan programs had a reduction in grant funding in the most recent year. Moreover, a substantial decrease in contributions in a state partner program exacerbated the decrease because a high value project was completed in the prior year.

GEORGIA ENVIRONMENTAL FINANCE AUTHORITY | 11

FY2020 NET POSITION

PRIMARY GOVERNMENT

GOVERNMENTAL ACTIVITIES

BUSINESS-TYPE ACTIVITIES

2020

2019

2020

2019

Current and other assets Capital assets
Total assets Deferred outflows of resources Long-term liabilities outstanding Other liabilities
Total liabilities Deferred inflows of resources Net position:
Investment in capital assets Restricted Unrestricted
Total net position

$ 55,959,362 132,977
56,092,339 1,025,881 5,528,328 3,072,943 8,601,271 2,135,839
132,977 40,142,232
6,105,901 $ 46,381,110

57,043,023 216,060
57,259,083 1,457,741 7,109,104 2,556,171 9,665,275 1,793,136
216,060 41,709,504 5,332,849 47,258,413

2,476,142,649 --
2,476,142,649 -- --
1,953,705 1,953,705
--
-- 1,882,645,322
591,543,622 2,474,188,944

2,389,574,849 --
2,389,574,849 -- --
2,496,696 2,496,696
--
-- 1,803,070,372
584,007,781 2,387,078,153

TOTAL

2020

2019

INCREASE (DECREASE)
%

2,532,102,011 132,977
2,532,234,988 1,025,881 5,528,328 5,026,648
10,554,976 2,135,839

2,446,617,872 216,060
2,446,833,932 1,457,741 7,109,104 5,052,867 12,161,971 1,793,136

3.5% (38.5%)
3.5% (29.6%) (22.2%) (0.5%) (13.2%)
19.1%

132,977 1,922,787,554
597,649,523 2,520,570,054

216,060 1,844,779,876 589,340,630 2,434,336,566

(38.5%) 4.2% 1.4% 3.5%

Copies of the complete audited financial statements are available at gefa.georgia.gov.

Financial Highlights

FY2020 STATEMENT OF NET POSITION

GOVERNMENTAL ACTIVITIES

PRIMARY GOVERNMENT
BUSINESS-TYPE ACTIVITIES

Assets

Cash

$

Cash with fiscal agent

Investments

Due from other governments

Internal balances

Accrued interest receivable

Loans receivable

Other assets

Net OPEB asset

Capital assets, net of accumulated depreciation

Total assets



Deferred Outflows of Resources

Related to other postemployment benefits

Related to pensions

Total deferred outflows of resources

2,977,092 --
46,568,659 4,153,474 1,947,289 -- -- 2,870 309,978 132,977
56,092,339
208,925 816,956 1,025,881

Liabilities Accounts payable and accrued liabilities Retainage payable Compensated absences, current Long-term liabilities:
Compensated absences, net of current portion Net OPEB liability Net pension liability Total liabilities

3,072,943 --
115,960
347,879 941,589 4,122,900 8,601,271

Deferred Inflows of Resources Related to other postemployment benefits Related to pensions
Total deferred inflows of resources

1,755,956 379,883
2,135,839

Net Position Investment in capital assets Restricted for:
Debt service Grant programs Loan programs Unrestricted Total net position

132,977

--

2,711,769

37,430,463

6,105,901

$

46,381,110

4,800,699 --
1,016,260,088 1,808,535 (1,947,289) 2,054,177
1,453,166,439 -- -- --
2,476,142,649
-- -- --
868,242 1,085,463
--
-- -- -- 1,953,705
-- -- --
--
-- -- 1,882,645,322 591,543,622 2,474,188,944

See accompanying notes to basic financial statements.

TOTAL

COMPONENT UNIT
GA. ENVIRON. LOAN ACQ. CORP

7,777,791 --
1,062,828,747 5,962,009 -- 2,054,177
1,453,166,439 2,870
309,978 132,977 2,532,234,988
208,925 816,956 1,025,881
3,941,185 1,085,463
115,960
347,879 941,589 4,122,900 10,554,976
1,755,956 379,883
2,135,839
132,977
-- 2,711,769 1,920,075,785 597,649,523 2,520,570,054

26,122 1
51,073,225 -- --
33,391 30,172,945
-- -- -- 81,305,684
-- -- --
110,457 -- --
-- -- -- 110,457
-- -- --
--
-- -- -- 81,195,227 81,195,227

GEORGIA ENVIRONMENTAL FINANCE AUTHORITY | 13

FY2020 STATEMENT OF ACTIVITIES

EXPENSES

PROGRAM REVENUES

NET (EXPENSE) REVENUE AND CHANGES IN NET POSITION

CHARGES FOR SERVICES

OPERATING GRANTS AND CONTRIBUTIONS

CAPITAL GRANTS AND CONTRIBUTIONS

GOVERNMENT ACTIVITIES

BUSINESS-TYPE ACTIVITIES

TOTAL

COMPONENT UNIT

Functions/Programs: Governmental activities:
General government Water and wastewater Energy and environment
Total governmental activities Business-type activities:
Water and wastewater Storage tank maintenance Outdoor stewardship and land conservation General and administrative
Total business-type activities Total primary government

$ 5,210,778 12,442,827 8,166,627 25,820,232
10,782,265 732,388
857 123,799 11,639,309 $ 37,459,541

-- 1,667,208
-- 1,667,208
-- 1,079,350
-- 27,108,477 28,187,827 29,855,035

12,582,559 10,076,175 7,780,006 30,438,740
10,782,265 20,162
82,063 51,592,780 62,477,270 92,916,010

--

7,371,781

--

--

(699,444)

--

--

(386,621)

--

--

6,285,716

--

--

--

--

--

--

367,124

--

--

81,206

--

--

78,577,458

--

--

79,025,788

--

6,285,716

79,025,788

7,371,781 (699,444) (386,621) 6,285,716
-- 367,124
81,206 78,577,458 79,025,788 85,311,504

Component Unit:

Georgia Environmental Loan

Acquisition Corporation

$ 2,618,351

1,198,877

1,283,805

--

Total Component Units

$ 2,618,351

1,198,877

1,283,805

--

(135,669)

General revenues: Unrestricted investment earnings Miscellaneous
Transfers Total general revenues and transfers Change in net position
Net position July 1 Net position June 30

$ 799,364 122,270
(8,084,653) (7,163,019)
$ (877,303) 47,258,413
$ 46,381,110

-- 350 8,084,653 8,085,003 87,110,791 2,387,078,153 2,474,188,944

799,364 122,620
-- 921,984 86,233,488 2,434,336,566 2,520,555,024

-- 4,815
-- (130,854) (130,854) 81,326,081 81,195,227

See accompanying notes to basic financial statements.

Financial Highlights

2020 REVENUES AND EXPENSES
1% 24%
75%

FISCAL YEAR 2020 REVENUES

Charges for Services and Other Revenue* Investment Earnings, Unrestricted Operating Grants and Contributions

$29,977,655 $799,364
$92,916,010

Total Revenues

$123,693,029

24% 1%
75%
100%

2% 14%
22%
62%

FISCAL YEAR 2020 EXPENSES

General Government Water and Wastewater Outdoor Stewardship and Land Conservation Energy and Environment Storage Tank Maintenance General and Administrative

$5,210,778 $23,225,092
$857 $8,166,627
$732,388 $123,799

Total Expenses

$37,459,541

14% 62% 0% 22%
2% 0%
100%

*Includes restricted investment earnings

Fiscal Services The Fiscal Services Division provides accounting, underwriting, and loan servicing for GEFA programs. It ensures compliance with agency, state, and federal fiscal policies and procedures, and it reviews and recommends loan awards for the Water Resources Division. The division performs credit analyses; provides reimbursements for loan project expenses; processes loan payments; calculates loan repayment figures and accrued construction-period loan interest; monitors borrowers for debt service coverage; and reviews compliance limits for GEFA customers. Team members provide consultations to communities on underwriting; prepare and submit financial reports to state and federal authorities; process invoices; monitor division accounts; and manage the agency's budget.
Human Resources Human Resources facilitates the general administration of the agency through developing, maintaining, and communicating office policy. Key responsibilities include developing and implementing hiring and recruiting policies, compensation and salary administration, conducting employee relations, developing official documentation on workplace ethics/code of conduct, employee handbooks, employee training programs, and award programs.
Public Affairs The Public Affairs Division educates internal and external stakeholders about GEFA's infrastructure and financing programs, and state energy, land, and water conservation initiatives and policies.
Information Technology The Information Technology Division develops GEFA's internal and external technical architecture; facilitates electronic access to agency information and services; and protects information systems and data.

GEORGIA ENVIRONMENTAL FINANCE AUTHORITY | 15
Board of Directors
Mayor Jimmy Andrews Chairman City of Sandersville Commissioner Jason Winters Vice Chairman Chattooga County Sole Commissioner Greg Griffin Secretary State Auditor Commissioner Eugene Cason Dooly County George McIntosh At-Large Member Commissioner Christopher Nunn Georgia Department of Community Affairs Commissioner Scott Orenstein Lowndes County Rick Story At-Large Member Commissioner Pat Wilson Georgia Department of Economic Development Mayor Mike Young City of McRae-Helena
Executive and Senior Staff
Kevin Clark Executive Director David Gipson Director of Energy Resources Stephen Gray Director of Water Resources Jammie Harden Director of Fiscal Services Shane Hix Director of Public Affairs and Information Technology Glendale Jones Director of Human Resources Susan Lucki Director of Administration
*As of June 2020

GEORGIA ENVIRONMENTAL FINANCE AUTHORITY
gefa.georgia.gov | 404-584-1000 main | 404-584-1069 fax 233 Peachtree St NE, Ste 900, Atlanta, GA 30303