CITY
OF ALAMEDA, CALIFORNIA
ALAM
EDA COUNTY TRANSPORTATION COMMISSION
MEASURE BB PROGRAM
FINANCIAL STATEMENTS
FO
R THE YEAR ENDED JUNE 30, 2024
Exhibit 5
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CITY OF ALAMEDA, CALIFORNIA
ALAMEDA COUNTY TRANSPORTATION COMMISSION
MEASURE BB PROGRAM
FINANCIAL STATEMENTS
For the Year Ended June 30, 2024
Table of Contents
Page
In
dependent Auditor’s Report........................................................................................... 1 Fina
ncial Statements:
B
alance Sheets ................................................................................................................ 4 S
tatements of Revenues, Expenditures, and Changes in Fund Balances ...................... 5 No
tes to the Financial Statements .................................................................................. 6 In
dependent Auditor’s Report 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 .............................. 10 In
dependent Auditor’s Report on Measure BB Compliance....................................... 12 This Page Left Intentionally Blank
I
NDEPENDENT AUDITOR’S REPORT
T
o the Honorable Members of the City Council
City of Alameda, California
R
eport on the Audit of the Financial Statements
O
pinion
W
e have audited the accompanying financial statements of the Alameda County Transportation Commission Measure BB Program (Measure BB Program) of the City of Alameda (City), California, as of and for the year ended June 30, 2024, and the related notes to the financial statements, as listed in the Table of Contents.
I
n our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Measure BB Program as of June 30, 2024, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.
B
asis for Opinion
W
e 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. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirement relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
E
mphasis of a Matter
A
s discussed in Note 1, the financial statements present only the Measure BB Program and do not purport to, and do not present fairly the financial position of the City as of June 30, 2024, the changes in the financial position, or where applicable, its cash flows for the year then ended in accordance to accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter.
R
esponsibilities of Management for the Financial Statements M
anagement 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, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.
1 In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Measure BB Program ’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
A
uditor’s Responsibilities for the Audit of the Financial Statements Ou
r objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists.
The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements
.
I
n performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
• E
xercise professional judgment and maintain professional skepticism throughout the audit. • I
dentify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Suc h p
rocedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
• O
btain an understanding of internal control relevant to the audit 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 City’s internal control as it relates to the Measure BB Program. Accordingly, no such opinion is expressed.
• E
valuate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
W
e are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control -related matters that we identified during the audit.
2 Other Reporting Required by Government Auditing Standards I
n accordance with Government Auditing Standards , we have also issued our report dated December 27, 2024 on our consideration of the City’s internal control over financial reporting as it relates to the Measure BB Program and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely 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 the effectiveness of the City’s 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 as it relates to the Measure BB Program.
Ple
asant Hill, California
December 27, 2024
3 CITY OF ALAMEDA
ALAMEDA COUNTY TRANSPORTATION COMMISSION
MEASURE BB PROGRAM
BALANCE SHEETS
JUNE 30, 2024
Local Streets Bicycle and
Paratransit and Roads Pedestrian Total
ASSETS
Cash and investments 784,002 $ 6,424,283 $ 845,841 $ 8,054,126 $ Direct local distribution program receivable - Measure BB 85,798 815,904 86,981 988,683 TOTAL ASSETS 869,800$ 7,240,187 $ 932,822 $ 9,042,809 $
FUND BALANCES
Restricted for Measure BB Programs 869,800$ 7,240,187 $ 932,822 $ 9,042,809 $ TOTAL FUND BALANCES 869,800$ 7,240,187 $ 932,822 $ 9,042,809 $ See Accompanying Notes to the Financial Statements.
4 Local Streets Bicycle and
Paratransit and Roads Pedestrian Total
REVENUES
Measure BB direct local distribution funds allocation 554,258$ 5,289,344 $ 563,625 $ 6,407,227 $ Interest income 31,942 294,597 31,502 358,041
Changes in fair value 3,331 40,777 5,936 50,044
Total Revenues 589,531 5,624,718 601,063 6,815,312
EXPENDITURES
Planning and engineering 306,139 516,999 252,461 1,075,599 Transportation and construction 61,513 4,030,294 36,538 4,128,345 Total Expenditures 367,652 4,547,293 288,999 5,203,944 NET CHANGE IN FUND BALANCES 221,879 1,077,425 312,064 1,611,368
FUND BALANCES
Beginning fund balances 647,921 6,162,762 620,758 7,431,441 Ending fund balances 869,800$ 7,240,187$ 932,822$ 9,042,809$ See Accompanying Notes to the Financial Statements.
CITY OF ALAMEDA
ALAMEDA COUNTY TRANSPORTATION COMMISSION
STATEMENTS OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES FOR THE YEAR ENDED JUNE 30, 2024
MEASURE BB FUNDS
5 CITY OF ALAMEDA, CALIFORNIA
ALAMEDA COUNTY TRANSPORTATION COMMISSION
MEASURE BB PROGRAM
NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended June 30, 2024
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
A. D
escription of Reporting Entity
U
nder Measure BB, approved by the voters of Alameda County in November 2014, the City of Alameda (City) receives a one-half percent sales tax to be used for local transportation -related expenditures. The duration of the tax will be 30 years from the initial year of collection, which began on April 1, 2015 and will expire on March 31, 2045. The voters also extended the Measure B one-half percent sales tax to 2045. This resulted in a total of one percent sales tax in Alamed a
C
ounty dedicated to transportation expenditures.
B. B
asis of Presentation
T
he Measure BB Program has been accounted for in a special revenue fund, which is a governmental fund type and is included in the City's basic financial statements as a nonmajor governmental fund. Special revenue funds are used to account for proceeds of specific revenues that are legally restricted to be expended for specified purposes.
T
he financial statements do not purport to, and do not, present the financial position or changes in financial position of the City. The projects represent a portion of the activities of the City and, as such, are included in the City's basic financial statements.
C. B
asis of Accounting
T
he accompanying financial statements are prepared on the modified accrual basis of accounting.
Revenues are recorded when measurable and available. The City considers all revenues reported in the governmental funds to be available if the revenues are generally collected within sixty days after year-end. Expenditures are recorded when the related liabilities are incurred.
T
he accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a “current financial resources” measurement focus, wherein only current assets and current liabilities generally are included on the balance sheets. Operating statements of governmental funds presents increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets.
D. Def
erred Inflows of Resources
Def
erred inflows of resources represent an acquisition of net assets that applies to a future period and will not be recognized as an inflow of resources (revenue) until that time. This amount is deferred and recognized as an inflow of resources in the period that the amount becomes available.
6 CITY OF ALAMEDA, CALIFORNIA
ALAMEDA COUNTY TRANSPORTATION COMMISSION
MEASURE BB PROGRAM
NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended June 30, 2024
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES (Continued) E. F
und Balance
M
easure BB Program fund balance is restricted. A restricted fund balance represents amounts that can be spent only for specific purposes stipulated by external resource providers, constitutionall y or
through enabling legislation. Restrictions may effectively be changed or lifted only with the consent of resource providers.
W
hen an expenditure is incurred for purposes for which both restricted and unrestricted fund balance is available, the City considers restricted funds to have been spent first.
F. Use o
f Estimates
M
anagement uses estimates and assumptions in preparing the financial statements. Tho se est
imates and assumptions affect the reported amounts of assets, deferred outflows of resources, liabilities and deferred inflows of resources, the disclosures of contingent assets and liabilities, and the reported revenues and expenditures. Actual results could differ from those estimates.
NOTE 2 – CASH AND INVESTMENTS
C
ash and investments represent the Measure BB Program’s share of the City’s Treasury pool. All of the Measure BB Program’s cash and investments are deposited in the City’s Treasury pool as described in the City’s Annual Comprehensive Financial Report, which can be obtained from the City’s Department of Finance. The pool is unrated. Investments in the pool are made in accordance with the City’s investment policy as approved by the City Council. Investments are stated at fair value. However, the value of the pool shares in the City’s Treasury pool that may be withdrawn is determined on an amortized cost basis, which is different from the fair value of the Measure BB Program’s position in the pool. Interest earned from time deposits and investments is allocated annually to the Program’s based on the average monthly cash balance. The Measure BB Program’s proportionate share of investments in the City’s Treasury pool at June 30, 2024 of $8,054,126, which is not subject to the fair value hierarchy.
NOTE 3 – MEASURE BB DIRECT LOCAL DISTRIBUTION PROGRAM RECEIVABLES The Measure BB Direct Local Distribution Program Receivables represent the Measure BB sales tax revenues for the fiscal year received from the Alameda County Transportation Commission after June 30, 2024.
7 CITY OF ALAMEDA, CALIFORNIA
ALAMEDA COUNTY TRANSPORTATION COMMISSION
MEASURE BB PROGRAM
NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended June 30, 2024
NOTE 4 – MEASURE BB FUNDS
U
nder Measure BB, approved by the voters of Alameda County in 2014, the City receives a portion of the proceeds of an additional one -half cent sales tax to be used for transportation - related expenditures. This measure was adopted with the intention that the funds generated by the additional sales tax will not fund expenditures previously paid for by property taxes but, rather, would be used for additional projects and programs.
A
lameda County Transportation Commission (ACTC) distributes Measure BB funds to the City of Alameda for local street maintenance and safety; bicycle and pedestrian paths and safety; and for Paratransit for seniors and people with disabilities.
L
ocal projects funded by Measure BB revenues received during fiscal year 20 23-24 were as follows:
P
aratransit – $ 554,258 includes funding the costs of transportation services for paratransit and seniors.
L
ocal Streets and Roads – $5,289,344 pass-through allocation for the funding of the following Streets and Roads projects:
- S
idewalks - Multi-Model Project
- P
avement Management - Safe Routes to School
- C
entral Avenue Safety Improvements - Lincoln Marshal Safety Improvements - Tr
affic Signal and System - Shoreline – Posey/ Webster Tunnel B
icycle and Pedestrian – $ 563,625 includes funding for the Complete Streets and Bike and Pedestrian Program.
8 This Page Left Intentionally Blank
9 INDE
PENDENT AUDITOR’S REPORT 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
T
o the Honorable Members of the City Council
City of Alameda, California
W
e have audited, in accordance with the 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, the financial statements of the Alameda County Transportation Commission Measure BB Program of the City of Alameda (City), California, as of and for the year ended June 30, 20 24, and have issued our report thereon dated December 27, 2024. Our report included an emphasis of a matter paragraph stating that the financial statements of the Measure BB Program do not purport to, and do not, present fairly the financial position of the City as of June 30, 2024.
R
eport on Internal Control over Financial Reporting
I
n planning and performing our audit of the financial statements, we considered the City’s internal control over financial reporting (internal control) as it relates to the Measure BB Program as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control as it relates to the Measure BB Program. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control as it relates to the Measure BB Program.
A d
eficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the Measure BB Program’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
O
ur consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that have not been identified. 10 Report on Compliance and Other Matters
As p
art of obtaining reasonable assurance about whether the financial statements of the Measure BB Program are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion.
The results of our tests disclosed no instances of noncompliance or other matters that are required under Government Auditing Standards.
P
urpose of this Report
T
he purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control or on compliance as it relates to the Measure BB Program. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control and compliance as it relates to the Measure BB Program. Accordingly, this communication is not suitable for any other purpose.
Ple
asant Hill, California
December 27, 2024
11 INDE
PENDENT AUDITOR'S REPORT
ON MEASURE BB COMPLIANCE
T
o the Honorable Members of the City Council
City of Alameda, California
Rep
ort on Compliance for Measure BB Program
O
pinion on Compliance for Measure BB Program
W
e have audited the City of Alameda’s (City’s) compliance with the requirements of laws, regulations, contracts, and grants specified in the Master Programs Funding Agreement between the City and the Alameda County Transportation Commission (Funding Agreement) that could have a direct and material effect on the Alameda County Transportation Commission Measure BB Program for the year ended June 30, 2024.
I
n our opinion, the City complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on Measure BB Program for the year ended June 30, 2024.
B
asis for Opinion on the Measure BB Program
W
e conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America (GAAS); the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States ( Government Auditing Standards), and requirements specified in the Funding Agreement. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of Compliance section of our report.
W
e are required to be independent of the City and to meet our other ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on compliance for the Measure BB Program. Our audit does not provide a legal determination of the City’s compliance with the compliance requirements referred to above.
R
esponsibilities of Management for Compliance
M
anagement is responsible for compliance with the requirements referred to above and for the design, implementation, and maintenance of effective internal control over compliance with the requirements of laws, statutes, regulations, rules and provisions of contracts or grant agreements applicable to the Measure BB Program.
12 Auditor’s Responsibilities for the Audit of Compliance Ou
r objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above occurred, whether due to fraud or error, and express an opinion on the City’s compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS, Government Auditing Standards and requirements specified in the Funding Agreement will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about the City’s compliance with the requirements of the Measure BB Program as a whole.
I
n performing an audit in accordance with GAAS, Government Auditing Standards and the Funding Agreement, we
• e
xercise professional judgment and maintain professional skepticism throughout the audit. • i
dentify and assess the risks of material noncompliance, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the City’s compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances. • obt
ain an understanding of the City’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances and to test and report on internal control over compliance in accordance with the requirements referred to above, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control over compliance. Accordingly, no such opinion is expressed.
W
e are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we identified during the audit.
Rep
ort on Internal Control Over Compliance
A d
eficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of the Measure BB Program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of the Measure BB Program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of the Measure BB Program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
13 Our consideration of internal control over compliance was for the limited purpose described in the Auditor’s Responsibilities for the Audit of Compliance section above and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies in internal control over compliance. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal control over compliance may exist that were not identified.
O
ur audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.
T
he purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements, specified in the Master Programs Funding Agreement between the City and the Alameda County Transportation Commission. Accordingly, this report is not suitable for any other purpose.
Ple
asant Hill, California
December 27, 2024
14