Agenda — Anderson City Council, September 3, 2024 (part 1 of 2)

CITY COUNCIL AGENDA
September 3, 2024
REGULAR SESSION - 6;00 P.M,

ANDERSON CITY HALL
1887 Howard Street

PARTICIPATION BY PUBLIC IN MEETING
Please review the Agenda to determine if the subject you wish to discuss is scheduled for Council consideration. If it is on the Agenda, you will have an opportunity when that matter comes up for discussion to briefly address the Council.

If the subject is l1Qt. on tonight's Agenda, please complete an Agenda Request Form (on Clerk's table) and present it to the City Council Clerk. You will have the opportunity to speak on the subject under Item 5.2. However, if the item is not on the Agenda, each speaker will be limited to one three (3) minute opportunity to speak, unless the City Council makes an exception due to special circumstances.

The Brown Act prohibits the Council from taking action on any item not placed on the printed Agenda in most cases.

The Brown Act requires any non-confidential documents or writings distributed to a majority of the City Council less than 72 hours before a regular meeting will be made available to members of the public at the same time they are distributed.

City Council meetings are televised and can be seen live on Cable Public Access Channel 181 (previously Channel 11) and on tape delay the following morning at 10:00 a.m. City Council meetings may also be viewed on the City's website at www,cJ.an4ers,on.ca.us by clicking on the TV icon on the Home Page.

In compliance with the Americans with Disabilities Act, the City of Anderson will make available to members of the public any special assistance necessary to participate in this meeting. The public should contact the City Clerk's office (378-6646) to make such a request. Notification 72 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting.

This is an Equal Opportunity Program. Discrimination is prohibited by Federal Law.

Complaints of discrimination may be filed with the Secretary of Agriculture, Washington, D.C. 202S0.

City Council Meeting
September 3, 2024

Page 2 ends

1.0 ROLL CALL - COUNCIL:

REGULAR SESSION - 6:00 P.M.

Councilmember Baugh
Councilmember Gallagher
Councilmember Gallier
Vice-Mayor Hunt
Mayor Neutze

2.0 INVOCATION -Dr. Ron Yabut. Anderson Seventh Day Adventist Church, will give the invocation.

3.0 PLEDGE OF ALLEGIANCE - Councilmember Dan Gallier

4.3 PRESENTATIONS - Cascade Union Elementary School District Superintendent Jason Provence will give a presentation on Measure I.

5.2 PUBLIC COMMENT ON ITEMS NOT ON THE AGENDA - This is the time to address public comments by any member of the public to the Council regarding an item not on the agenda. Each comment must be limited to 3 minutes or less and on an item within the City's subject matter jurisdiction. The Brown Act does not permit any action or discussion on items not listed on the agenda. Are there any public comments?

CONSENT AGENDA

6.0 CONSENT AGENDA - Consent Agenda items are expected to be routine and noncontroversial. They will be acted upon by the Council at one time without discussion. Any member of the public, staff or City Council may request that an item be removed from the Consent Agenda for separate discussion. Are there any requests to remove any items from the Consent Agenda?

6.1 MINUTES -Approve the minutes of the regular meeting of August 20, 2024.

6.2 WARRANTS - Receive and file warrant 32731 to 32771 in the amount of $111,584.51; Receive and file ACH in the amount of $56,305.77; Receive and file warrant 32772 to 32817 in the amount of $248,661.99.

6.3 CITY ATTORNEY - Enact Ordinance No. 861 (second reading) amending 17.67.050 of the Anderson Municipal Code regulating retail delivery of medical marijuana within all zones in the city, as introduced on August 20, 2024 (first reading).

6.5 CITY MANAGER -Thank you letter for the Shasta 150 Race Series.

City Council Meeting
September 3, 2024

Page 3 ends

END OF CONSENT CALENDAR

6.11 ITEMS (IF ANX) REMOVED FROM THE CONSENT CALENDAR - Items removed from the Consent Agenda for discussion will be treated as Regular Agenda items and any member of the public may request to address the Council on any such item as it comes up for discussion. Please provide your name and limit your remarks to 3 minutes or less.

REGULAR AGENDA

8.0 REGULAR AGENDA - Regular Agenda Items will be discussed individually and in order.

8.3 8.5
Any member of the public may request to address the Council on an item as it comes up for discussion. Please provide your name and limit your remarks to 3 minutes or less.

CITY MANAGER

OFFICIAL VOTING DELEGATE TO LEAGUE OF CALIFORNIA CITIES ANNUAL CONFERENCE FOR 2024
RECOMMENDED ACTION:

Authorize an Official Voting Delegate at the League of California Cities Annual Conference October 16-18, 2024 that will be held in person at the Long Beach Convention Center.

FINANCE DIRECTOR
2022-2023 ANNUAL COMPREHENSIVE FINANCIAL REPORT
RECOMMENDED ACTION:

1. Receive a presentation from the City's contracted auditor, Frances Kuo of The Pun Group

2. Receive and file the annual financial report.

11.0 COUNCIL REPORTS/COMMENTS - City Councilmembers will report on attendance at conferences/meetings reimbursed at City expense (Requirement of Assembly Bill 1234.)

14.0 ADJOURN - The City Council will adjourn to September 17. 2024.

ANDERSON CITY COUNCIL MINUTES
Regular Meeting
August 20, 2024

REGULAR SESSION
The regular session was called to order at 6:00 p.m.

ROLL CALL
Councilmembers present: Councilmember Baugh
Councilmember Gallagher
Councilmember Gallier
Vice-Mayor Hunt
Mayor Neutze
DRAFT
Also present: City Manager Joey Forseth-Deshais, City Attorney Collin Bogener, Police Chief Greg Baarts, Public Works Director Adam Whelen and City Clerk Christy White.

INVOCATION
Nick Braito, Neighborhood Church of Anderson/Cottonwood, gave the invocation.

PLEDGE OF ALLEGIANCE
Mayor Stan Neutze led the Pledge of Allegiance.

STUDENT REPORTS
Freedom from the Teen Center gave an update on current activities and answered questions from Council.

RECOGNITION
Public Works Director Adam Whelen recognized Brad Hawkins for receiving his Certified Code Enforcement Officer Certification.

PUBLIC COMMENT ON ITEMS NOT ON THE AGENDA
Dolores Lucero from Shasta County Watch Dog Group spoke with concerns regarding City Attorney Collin Bogener.

Kerry Vorhees spoke regarding a Code Enforcement issue in his neighborhood.

ITEM 6.1 9/3/2024
City Council Meeting
September 3, 2024

Page 2 of 4 ends

CONSENT AGENDA
By motion made, second (Hunt/Gallier) and carried by a 5-0 vote, Council took the following action.

Approved the minutes of the regular meeting of July 16, 2024 and special meeting minutes of August 13, 2024.

Received and filed warrant 32453 to 32513 in the amount of $318,987.16; Received and filed warrant 32514 to 32566 in the amount of $445,839.90; Received and filed warrant 32567 to 32621 in the amount of $289,856.81; Received and filed warrant 32622 to 32684 in the amount of $218,130.25. Received and filed warrant 32685 to 32729 in the amount of $942,091.06.

Approved Notice of Withdrawal from the Shasta County Waste Management Agency.

Approved Letter of Opposition towards Assembly Bill 1886 (Alvarez) Approved the Memorandum of Understanding for Anderson Police Department participation in the Shasta Interagency Narcotics Task Force (SINTF).

Approved Notice of Completion of the 2024 Pavement Repair Project.

AYES:

NOES:

ABSTAIN:

ABSENT:

Councilmembers Hunt, Gallier, Baugh, Gallagher and Mayor Neutze.

None.

REGULAR AGENDA

CITY MANAGER

LETTER OF SUPPORT FOR CDBG-DR FUNDING FOR THE SUNRISE COTTAGES

DEVELOPMENT
City Manager Joey Forseth-Deshais gave a staff report and answered questions from Council.

By motion made, seconded (Hunt/Baugh) and carried by a 5-0 vote Council voted to not show support for the Sunrise Cottages affordable senior housing project by not approving a letter of support from the City of Anderson to be submitted with Rural Community Housing Development Corporation's CD BG-DR funding application
AYES:

NOES:

ABSTAIN:

ABSENT:

Councilmembers Hunt, Baugh, Gallagher, Gallier, and Mayor Neutze.

None.

City Council Meeting
September 3, 2024

Page 3 of 4 ends

Angelica Figueroa spoke giving information on the project and organization.

Crystal Spencer from Faith Works Community Coalition let Council know their roll in the project.
7:15 p.m. Council member Gallier left the dais.
7:17 p.m. Councilmember Gallier returned to the dais.

PUBLIC WORKS DIRECTOR

AUTHORIZATION TO AWARD THE COBBLESTONE SEWER REPLACEMENT PROJECT Public Works Director Adam Whelen gave a staff report and answered questions from Council.

By motion made, seconded (Baugh/Gallier) and carried by a 5-0 vote Council voted to award the contract for the Cobblestone Sewer Replacement Project to Sunrise Excavating Inc. from Redding, CA, in the amount of Seventy-Seven Thousand Dollars ($77,000.00); authorize the City Manager to execute the contract upon receipt of required insurance certificates and payment and performance bonds and authorize the City Manager to approve additional project change orders not to exceed 15% of the contract bid amount.

AYES:

NOES:

ABSTAIN:

ABSENT:

Councilmembers Baugh, Gallier, Hunt, Gallagher and Mayor Neutze.

None.

MCMURRY DRIVE REHABILITATION PROJECT
Public Works Director Adam Whelen gave a staff report and answered questions from Council.

By motion made, seconded (Hunt/Baugh) and carried by a 5-0 vote Council adopt Resolution No. 24-40 finding the McMurry Drive Rehabilitation Project Categorically Exempt in accordance with Section 15301, Class 1( c) of the California Environmental Quality Act (CEQA) and approved the Plans, Specifications, Estimates and Contract Documents for the McMurry Drive Rehabilitation Project and instruct the Public Works Director to advertise for bid.

Vote: AYES:

NOES:

Councilmembers Hunt, Baugh, Gallagher, Gallier and Mayor Neutze.

None.

ABSTAIN: None.

ABSENT: None.

City Council Meeting
September 3, 2024

Page 4 of 4 ends

STAFF REPORTS - Councilmember Susie Baugh gave an update on the AT HOME Committee.

COUNCIL REPORTS/COMMENTS
Councilmembers used this time to report on meetings and activities they participated in and to announce upcoming events.

ADJOURNMENT
7;54 p,m,; The City Council adjourned to seutember 3, 2024.

Stan Neutze, Mayor
ATTEST:

Christy White, City Clerk

AGENDA ITEM
!Sept 3. 2024, City Council Meeting
• , City Manager
T
Ci
To:

Through:

Honorable Mayor and Members of the Anderson City Council Joey Forseth-Deshais, City Manager
From: Cindy Wheeler, Finance Director /Treasurer
Date: September 3rd, 2024

I SUBJECT
Receive and File Weekly Warrant Registers.

I RECOMMENDATION
Receive and file warrant 32731 to 32771 in the amount of $111,584.51; Receive and file ACH in the amount of $56,305.77; Receive and file warrant 32772 to 32817 in the amount of $248,661.99.

I ATTACHMENT
Warrant Registers.

ITEM 6.2 PAGE1 9/3/2024

CHECK REGISTER

VENDOR NAME CHECK CHECK CHECK

DESCRIPTION DATE NUMBER AMOUNT
000083 ACE HARDWARE
SUPPLIES-JOB #3 8/16/2024 32731 $1,805.01
000243 ALL CAR & TRUCK TOWING, LLC
PROFESSIONAL SERVICES 8/16/2024 32732 $238.00
000615 AT&T CALN ET
PHONE CHARGES 8/16/2024 32733 $64.26
000700 BADGER METER, INC.

EQUIPMENT 8/16/2024 32734 $219.30
000922 SUSAN BAUGH
HEALTH INS. REIMBURSEMENT 8/16/2024 32735 $1,453.80
000945 BEACON FIRE ALARM & SECURITY,
PROFESSIONAL SERVICES 8/16/2024 32736 $110.00
001750 CALIFORNIA SAFETY CO.

PROFESSIONAL SERVICES 8/16/2024 32737 $3,805.50
002167 CITY OF REDDING
UTILITIES 8/16/2024 32738 $1,280.27
002774 DARREN TAYLOR CONSTRUCTION
PROFESSIONAL SERVICES 8/16/2024 32739 $9,650.00
011944 EMERGENCY LOGISTICS SERVICES
EQUIPMENT RENTALS 8/16/2024 32740 $1,000.00
003451 ENTERPRISE AUTO PARTS
PARTS 8/16/2024 32741 $2,039.56
012202 TEDDI EPPS
KEY DEPOSIT REFUND 8/16/2024 32742 $10.00
PAGE 1

VENDOR NAME CHECK CHECK CHECK

DESCRIPTION DATE NUMBER AMOUNT
003618 FERGUSON WATERWORKS #1423
SUPPLIES 8/16/2024 32743 $1,468.36
012200 SHAWNA FLEETWOOD
CLEANING DEPOSIT REFUND 8/16/2024 32744 $350.00
004248 GRAINGER
SUPPLIES 8/16/2024 32745 $20.22
004351 GUITONS POOL CENTER
SUPPLIES 8/16/2024 32746 $180.18
012201 ANDREW GUMM
KEY DEPOSIT REFUND 8/16/2024 32747 $10.00
004736 HERO INDUSTRIES, INC.

PROFESSIONAL SERVICES 8/16/2024 32748 $6,750.00
012076 JOHN ROSSIE
PROFESSIONAL SERVICES 8/16/2024 32749 $625.00
005445 K & S STAFFING SOLUTIONS, INC.

PROFESSIONAL SERVICES 8/16/2024 32750 $4,811.20
007238 NETSOUND INC
PROFESSIONAL SERVICES 8/16/2024 32751 $31,875.00
007348 NORMAC
SUPPLIES 8/16/2024 32752 $762.72
007470 O'REILLY AUTO PARTS
PARTS 8/16/2024 32753 $368.46
007493 ODP BUSINESS SOLUTIONS, LLC
OFFICE SUPPLIES 8/16/2024 32754 $73.22
007630 PACIFIC GAS & ELECTRIC
UTILITIES 8/16/2024 32755 $14,263.33
007967 PLATT
SUPPLIES 8/16/2024 32756 $81.92
PAGE2

VENDOR NAME CHECK CHECK CHECK

DESCRIPTION DATE NUMBER AMOUNT
008498 RENTAL GUYS REDDING
EQUIPMENT RENTAL 8/16/2024 32757 $355.47
012176 RING CENTRAL INC
PHONE CHARGES 8/16/2024 32758 $1,799.93
012203 JENNIFER ROSENBERGER
KEY DEPOSIT REFUND 8/16/2024 32759 $10.00
008838 ROWELL FAMILY EMPOWERMENT OF N
KEY DEPOSIT REFUND 8/16/2024 32760 $10.00
009392 SHASTA CO. DEPT RESOURCE MGT.

PERMIT RENEWAL 19-PO-16 8/16/2024 32761 $20.00
009618 SIGNARAMA
PROFESSIONAL SERVICES 8/16/2024 32762 $204.06
012195 BRITTNEY TIMMONS
KEY DEPOSIT REFUND 8/16/2024 32763 $10.00
012199 KELSEY TRONCALE
PARK RENTAL FEE 8/16/2024 32764 $100.00
010688 ULINE
SUPPLIES 8/16/2024 32765 $2,188.08
010746 US BANK
ANDERSON RDS TARBS 2015 8/16/2024 32766 $1,900.00
010747 US BANK CORP PYMT SYSTEMS
SUPPLIES, EQUIPMENT, TRAINING 8/16/2024 32767 $21,121.91 VOID CHECK 8/16/2024 32768
012197 MONICA WEIDNER
KEY DEPOSIT REFUND 8/16/2024 32769 $10.00
011245 CINDY WHEELER
PER DIEM- TRAINING 8/16/2024 32770 $189.75
PAGE3

VENDOR NAME CHECK CHECK CHECK

DESCRIPTION DATE NUMBER AMOUNT
012198 SOUAXIONG
CLEANING DEPOSIT REFUND 8/16/2024 32771 $350.00
8/8/24 ACH PERS $56,305.77
FOR PAYROLL ENDING 8/2/24
$111,584.51
PAGE4

CHECK REGISTER

VENDOR NAME CHECK CHECK CHECK

DESCRIPTION DATE NUMBER AMOUNT
000048 AAMIGO IRRIGATION SUPPLY
SUPPLIES 8/23/2024 32772 $92.11
000243 ALL CAR & TRUCK TOWING, LLC
PROFESSIONAL SERVICES 8/23/2024 32773 $310.00
000322 AMERICAN FIDELITY ASSURANCE
INSURANCE PREMIUM-AUG 24 8/23/2024 32774 $2,563.58
000323 AMERICAN FIDELITY ASSURANCE CO
CAFETERIA 125 PE 8/16/24 8/23/2024 32775 $399.98
000355 AMERIGAS
TANK RENTAL 8/23/2024 32776 $152.55
000504 APEX FENCE CO
PARTS 8/23/2024 32777 $123.91
000615 AT&T CALNET
PHONE CHARGES 8/23/2024 32778 $2,239.65
001133 BIG VALLEY SANHATION
EQUIPMENT RENTAL 8/23/2024 32779 $718.75
001757 CALL CENTER SALES PRO
PROFESSIONAL SERVICES 8/23/2024 32780 $28.10
001881 CARREL'S OFFICE MACHINES
MONTHLY LEASE/BASE RATE 8/23/2024 32781 $254.39
002047 CHARTER COMMUNICATIONS
INTERNET CHARGES 8/23/2024 32782 $819.00
002047 CHARTER COMMUNICATIONS
INTERNET SERVICES 8/23/2024 32783 $90.56
002047 CHARTER COMMUNICATIONS
INTERNET SERVICES 8/23/2024 32784 $596.08
PAGE 1

VENDOR NAME CHECK CHECK CHECK

DESCRIPTION DATE NUMBER AMOUNT
002047 CHARTER COMMUNICATIONS
INTERNET SERVICES 8/23/2024 32785 $699.00
002047 CHARTER COMMUNICATIONS
INTERNET CHARGES 8/23/2024 32786 $104.98
002158 CITY OF ANDERSON
UTILITIES 8/23/2024 32787 $3,951.31
002199 CLARK PEST CONTROL OF STOCKTON
PROFESSIONAL SERVICES 8/23/2024 32788 $706.00
002392 CONSOLIDATED ELECTRICAL DIST.

SUPPLIES 8/23/2024 32789 $558.62
011815 DEWBERRY ARCHITECTS, INC.

PROFESSIONAL SERVICES 8/23/2024 32790 $15,586.00
003590 FASTENERS INC.

SUPPLIES 8/23/2024 32791 $187.46
008380 FREIGHTLINER NORTHWEST
PARTS 8/23/2024 32792 $109.74
003927 MIKE GALLAGHER
HEALTH INS. REIMBURSEMENT 8/23/2024 32793 $534.00
011814 DAN GALLIER
HEALTH INS. REIMBURSEMENT 8/23/2024 32794 $3,824.00
008407 GANNETT CALIFORNIA LOCALIQ
ADVERTISING 8/23/2024 32795 $1,201.10
004067 GHD, INC.

PROFESSIONAL SERVICES 8/23/2024 32796 $17,762.09
004248 GRAINGER
SUPPLIES 8/23/2024 32797 $510.79
004790 HIGHWAY SPECIALTY CO, INC
EQUIPMENT RENTAL 8/23/2024 32798 $1,262.29
PAGE2

VENDOR NAME CHECK CHECK CHECK

DESCRIPTION DATE NUMBER AMOUNT
005024 HUNT'S ELECTRIC MOTOR SERVICE
PARTS 8/23/2024 32799 $25.74
005445 K & S STAFFING SOLUTIONS, INC.

PROFESSIONAL SERVICES 8/23/2024 32800 $942.40
011792 MISSIONSQUARE-302204
PLAN# 302204 P/E 8/16/24 8/23/2024 32801 $4,310.00
006958 MOORE & BOGEN ER
PROFESSIONAL SERVICES 8/23/2024 32802 $9,422.00
007617 PACE ENGINEERING, INC.

PROFESSIONAL SERVICES 8/23/2024 32803 $17,579.50
007630 PACIFIC GAS & ELECTRIC
UTILITIES 8/23/2024 32804 $115,408.42
007669 PAPE MACHINERY
PARTS & PROFESSIONAL SVCS 8/23/2024 32805 $682.44
012017 PRESYNCED PRODUCTIONS
PROFESSIONAL SERVICES 8/23/2024 32806 $1,055.00
011940 QUICK QUACK CAR WASH
CAR WASHES 8/23/2024 32807 $721.62
009256 SCP DISTRIBUTORS, LLC
SUPPLIES 8/23/2024 32808 $6,162.83
009463 SHASTA FAMILY YMCA
SWIM PROGRAM 8/23/2024 32809 $3,501.68
009564 SHN CONSULTING ENGINEERS AND G
PROFESSIONAL SERVICES 8/23/2024 32810 $10,148.75
009845 SONSRAY MACHINERY, LLC
SUPPLIES 8/23/2024 32811 $299.94
PAGE3

VENDOR NAME CHECK CHECK CHECK

DESCRIPTION DATE NUMBER AMOUNT
010367 THATCHER COMPANY, INC.

SUPPLIES 8/23/2024 32812 $17,385.05
010874 VERIZON WIRELESS
PHONE CHARGES 8/23/2024 32813 $3,585.42
010981 DAVID WAKLEY
PER DIEM-TRAINING 8/23/2024 32814 $646.52
011064 WM CORPORATE SERVICES, INC
DUMP FEES 8/23/2024 32815 $1,343.71
011555 WYNTOUR GARDENS
MATERIALS 8/23/2024 32816 $34.93
012070 FIVE COUNTIES CLC
REFUND OVERPYMT ON FEE 8/23/2024 32817 $20.00
$248,661.99
PAGE4
To:

Through:

From:

Date:
lsueJECT

AGENDA ITEM
September 3, 2024, City Council
for Submittal By:

Joe
ented By:

Honorable Mayor and Members of the Anderson City Council Joey Forseth-Deshais, City Manager
Collin Bogener, City Attorney
September 3, 2024
Zone Amendment (ZA) 24-03, amending Section 17.67.050, "COMMERCIAL MARIJUANA OPERATION AS A COMMERCIAL USE" of Chapter. 17.67 "MARIJUANA ACTIVITIES" of Title 17 "ZONING" of the City of Anderson Municipal Code.

I RECOMMENDATION
Enact Ordinance No. 861 (second reading) amending 17.67.050 of the Anderson Municipal Code regulating retail delivery of medical marijuana within all zones in the city, as introduced on August 20, 2024 (first reading).

I BACKGROUND
Ordinance No. 825 an update to Chapter 17.67 - Marijuana Activities was adopted by Anderson City Council on August 20, 2019 in response to Assembly Bills 243 and 266 and Senate Bill 643 ( collectively, the Medical Marijuana Regulation and Safety Act or "MM RSA").

This legislation preserved local control over marijuana facilities and land uses, including the authority to completely prohibit marijuana dispensaries, cultivation and deliveries.

Currently, Chapter 17.67.050 prohibits commercial marijuana use in all zone districts.

In 2022, the Legislature passed and Gov. Gavin Newsom signed into law SB 1186 (Wiener), the Medicinal Cannabis Patients' Right of Access Act (Act). Beginning Jan. 1, 2024, the Act ITEM 6.3 9/3/2024
bars a city from adopting or enforcing any regulation that directly or indirectly prohibits retail delivery of medicinal cannabis to patients or caregivers in the city.

Under the Act, a city cannot adopt or enforce regulations that prohibit the "retail sale by delivery" of medicinal cannabis. This includes any regulation that has the effect of prohibiting patients within the city or their caregivers from purchasing, by delivery, sufficient medicinal cannabis to meet their demands in a timely and readily accessible manner. Examples of prohibited regulations which may have this effect include those that:

1. Limit the number of businesses authorized to deliver medicinal cannabis in the city.

2. Limit the operating hours of medicinal cannabis businesses.

3. Limit the number or frequency of medicinal cannabis sales by delivery.

4. Limit the types or quantities of medicinal cannabis.

5. Require the establishment of physical premises within the city.

The Act does not prevent a city from adopting or enforcing reasonable regulations on retail delivery of medicinal cannabis related to:

1. Zoning requirements.

2. Security or public health and safety requirements.

3. Licensing requirements.

4. Imposing or collecting applicable state or local taxes on retail sales of medicinal cannabis occurring within the city.

5. Regulations consistent with requirements or restrictions imposed on cannabis businesses by state law or regulations issued by the California Department of Cannabis Control (DCC).

On June 4, 2024 a joint Planning Commission and City Council workshop was held to review SB 1186 and to receive Council's direction regarding possible amendments to Anderson Municipal Code Chapter 17.67 - Marijuana Activities. Based on the parameters established by SB 1186 and consistent with direction provided by both the Planning Commission and City Council, the Anderson Municipal Code is proposed to amended as follows:
"17.67.050 - Commercial marijuana operation as a prohibited use.

A A commercial marijuana operation is a prohibited use in all zone districts in the city.

8. As an exception to subsection A and above, and as required by the Medicinal Cannabis Patients' Right of Access Act (Business and Professions Code Sections 26321, et seq.) a person may deliver or transport medicinal cannabis to a medicinal cannabis patient, subject to the following requirements:

1. Deliveries of medicinal cannabis to a medicinal cannabis patient must be made to fixed addresses and may not occur at locations such as schools, day care centers, youth centers, public parks, houses of worship, open spaces, public buildings, and establishments serving food or beverages.

ITEM 6.3 9/3/2024

2. A retailer with a physical address outside of the city that wishes to deliver medicinal cannabis or medicinal cannabis products to a patient or customer within city limits is required to obtain a City business license prior to commencing any delivery service within city limits.

3. All medicinal cannabis or medicinal cannabis products must be securely packaged and labeled according to State regulations, ensuring that they are not accessible to minors during transit.

4. Delivery vehicles must adhere to safety and security standards, which include GPS tracking, alarms, and secure storage.

5. The delivery of cannabis accessories, branded merchandise of the licensee, or promotional materials is prohibited, except for any equipment, products or materials necessary to enable a qualified patient to ingest, inhale, or otherwise introduce cannabis or cannabis products into the human body."
This proposed amendment continues to prohibit a commercial marijuana business to operate within the city limits. Under AB 1186, this continued exclusion does not have the effect of prohibiting medical marijuana patients from access through retail delivery of medical marijuana, because numerous commercial marijuana businesses in Redding deliver to patients in Anderson. Other jurisdictions like San Marcos and Brentwood have interpreted the new law in a similar manner.

On July 22, 2024, the proposed ordinance was considered by the Planning Commission during a public hearing. The Planning Commission approved recommending the proposed ordinance to the City Council in a 5-0 vote.

I ATTACHMENTS
Ordinance No 861
ITEM 6.3 9/3/2024
Ordinance No. 861
AN ORDINANCE AMENDING SECTION 17.67.050 (COMMERCIAL MARIJUANA OPERATION AS A COMMERCIAL USE) OF CHAPTER 17 .67 (MARIJUANA ACTIVITIES), OF TITLE 17 (ZONING) TO

PERMIT THE DELIVERY OF MEDICAL MARIJUANA INTO THE CITY OF ANDERSON WHEREAS, in 1970, the United States Congress enacted the Controlled Substances Act ("CSA") which, among other things, makes it illegal to import, manufacture, distribute, possess or use marijuana in the United States; and
WHEREAS, in 1972, California added Chapter 6 to the State Uniform Controlled Substances Act. commencing at Health and Safety Code section 11350, which established the state's prohibition, penalties, and punishments for the possession, cultivation, transportation, and distribution of marijuana; and
WHEREAS, in 1996, the voters of the State of California approved Proposition 215 (the "Act;" Health and Safety Code Section 11362.5, et seq.); and
WHEREAS, California courts have held that the Act creates a limited exception from criminal liability under the state Uniform Controlled Substances Act for seriously ill persons who are in need of medical marijuana for specified medical purposes and who obtain and use medical marijuana under limited, specified circumstances; and
WHEREAS, on January 1, 2004, the Medical Marijuana Program ("MMP"), codified as Health and Safety Code Sections 11362.7 to 11362.83, was enacted by the State Legislature to clarify the scope of the Act, establish a voluntary program for identification cards issued by counties for qualified patients and primary caregivers, and provide criminal immunity to qualified patients and primary caregivers for certain activities involving medical marijuana, including the collective or cooperative cultivation of medical marijuana; and
WHEREAS, the California Supreme Court ruled unanimously in City of Riverside v. Inland Empire Patients Health and Wellness Center, Inc. (2013) 56 Cal.4th 729, that the Act and the MMP do not preempt local ordinances that completely and permanently ban medical marijuana dispensaries, collectives, and cooperatives; and
WHEREAS, in Mara/ v. City of live Oak (2013) 221 Cal.App.4th 975, the Third District Court of Appeal held, based on Inland Empire, that there was no right to cultivate medical marijuana and that a city could implement and enforce a complete ban on this activity, including a ban on personal cultivation; and
WHEREAS, on October 9, 2015, Assembly Bills 243 and 266 and Senate Bill 643 (collectively, the Medical Marijuana Regulation and Safety Act or "MM RSA") were enacted to create a State regulatory and licensing system governing the cultivation, testing. and distribution of medical marijuana, the manufacturing of medical marijuana products, and physician recommendations for medical marijuana. This legislation preserved local control over marijuana facilities and land uses, including the authority to completely prohibit marijuana dispensaries, cultivation and deliveries; and WHEREAS, in order to protect the public health, safety, and welfare, the City Council desires to amend Anderson Municipal Code Section 17.67.050 to regulate cannabis dispensaries, cultivation facilities, commercial cannabis activities, and cannabis deliveries; and WHEREAS, on July 22, 2024, the Planning Commission held a duly-noticed public hearing to consider the staff report, recommendation by staff, and public testimony concerning this Ordinance. Following the public hearing, the Planning Commission voted to forward the Ordinance to the City Council with a recommendation in favor of its adoption; and
WHEREAS, on August 6, 2024 the City gave public notice of a City Council public hearing to be held to consider this Ordinance by advertisement in the Record Searchlight; and WHEREAS, on August 20, 2024, the City Council held a duly-noticed public hearing to consider the Ordinance, including the public testimony and agenda reports prepared in connection with the Ordinance, as well as the policy considerations discussed therein; and WHEREAS, all legal prerequisites to the adoption of the Ordinance have occurred.

NOW, THEREFORE, the City Council of the City of Anderson does ordain as follows:

SECTION 1. Section 17.67.050, "COMMERCIAL MARIJUANA OPERATION AS A COMMERCIAL USE" of Chapter 17.67 "MARIJUANA ACTIVITIES" of Title 17 "ZONING" of the City of Anderson Municipal Code is hereby amended to read as follows:
17 .67 .0S0 - Commercial marijuana operation as a prohibited use.

A. A commercial marijuana operation is a prohibited use in all zone districts in the city.

B. As an exception to subsection A and above, and as required by the Medicinal Cannabis Patients' Right of Access Act (Business and Professions Code Sections 26321, et seq.) a person may deliver or transport medicinal cannabis to a medicinal cannabis patient, subject to the following requirements:

3. All medicinal cannabis or medicinal cannabis products must be securely packaged and labeled according to State regulations, ensuring that they are not accessible to minors during transit.

4. Delivery vehicles must adhere to safety and security standards, which include GPS tracking, alarms, and secure storage.

SECTION 2. Compliance with CEQA. The City Council hereby finds that the action to adopt this Ordinance to amend Section 17.67.050 of the Anderson Municipal Code in its entirety is exempt from the provisions of the California Environmental Quality Act (Public Resources Code Section 21000, et seq.) (CEQA) because the City Council hereby finds that it can be seen with certainty that there is no possibility the adoption and implementation of this Ordinance may have a significant effect on the environment, and the Ordinance is exempt from CEQA pursuant to CEQA Guidelines Sections 15061(b)(l), 15061(b)(2), and 15061(b)(3).

SECTION 3. Severability. If any section, subsection, sentence, clause or phrase of this Ordinance or its attachments is for any reason held to be invalid or unconstitutional by the decision of a court of competent jurisdiction, the holding shall not affect the validity or enforceability of the remaining provisions, and the City Council declares that it would have adopted each provision of this ordinance irrespective of the validity of any other provision.

SECTION 4. ENACTMENT. The City Clerk shall certify the adoption of this ordinance and shall cause it to be posted and/or published in accordance with the law.

The foregoing Ordinance was introduced at a regular meeting of the City Council of the City of Anderson held on August 20, 2024 and enacted at a regular meeting of the City Council of the City of Anderson held on September 3, 2024 by the following vote.

AYES:

NOES:

ABSENT:

ABSTAIN:

Stan Neutze, Mayor
ATTEST:

Christy White, City Clerk

AGENDA ITEM
September 3, 2024 City Council Meeting I
rseth-Deshais, City Manager
To:

From:

Honorable Mayor and Members of the Anderson City Council Joey Forseth• Deshais, City Manager
Date: September 3, 2024

I SUBJECT
Thank you letter for the Shasta 150 Race Series

I RECOMMENDATION
Staff recommends the City Council send the thank you letter to Chris Wright, NASCAR K&N Pro Series Director.
!FISCAL IMPACT
This action has no fiscal impact.

I DISCUSSION and BACKGROUND
Following a successful return of NASCAR racing to Anderson for the 2023 Shasta 150, the ARCA Menards Series West returned on July 27th to Shasta Speedway for the 2024 edition of the 150-lap race. The cars and stars of the West Series were joined by the recordbreaking speeds of the Speed Tour Super Modifieds plus live music, autograph sessions, VIP opportunities and much more for the motorsports event of the summer at the Shasta District Fairgrounds. Activities kicked off Friday evening with the Hauler Parade around the City.

This is the 16th appearance for the NASCAR•sanctioned 600 horsepower machines in the west coast's most prestigious stock car tour.

I ATTACHMENTS
Thank you letter
ITEM 6.5 PAGE1 9/3/2024
September 3, 2024
Chris Wright
NASCAR K&N Pro Series Director
7010 West Winds Blvd
Concord, North Carolina 28027
Dear Chris,
We wanted to extend our heartfelt thanks for hosting the Shasta 150 race in Anderson, California. It was a wonderful event that brought our community together and showcased the beauty and hospitality of our City. Your team's dedication to organizing such a wellplanned and exciting race was evident in every detail.

The ARCA Menards Series fosters a spirit of camaraderie and enthusiasm among participants and spectators alike. It was fantastic to see so many people, of all ages and backgrounds, coming together to enjoy the event.

Thank you again for choosing Anderson as one of your race locations and helping support our local economy. We hope to welcome you back soon for another memorable race! Sincerely,
Stan Neutze, Mayor
City of Anderson
cc: Butch Schaefer
City Council
1887 Howard Street
Anderson, CA 96007
www.ci.anderson.ca.us Phone: (530) 378-6646
Fax: (530) 378-6648

AGENDA ITEM
~eptember 3, 2024 City Council Meeting
for Submittal By:
ented By:

To:

From:

Honorable Mayor and Members of the Anderson City Council Joey Forseth-Deshais, City Manager
Date: September 3, 2024

I SUBJECT
Official Voting Delegate to League of California Cities Annual Conference for 2024.

I RECOMMENDATION
The City Manager recommends that the City Council:

Authorize an Official Voting Delegate at the League of California Cities Annual Conference October 16-18, 2024 that will be held in person at the Long Beach Convention Center.

I FISCAL IMPACT, DISCUSSION and BACKGROUND
There is no fiscal impact of the proposed action.

I ATTACHMENTS
2024 Annual Conference Voting Delegate Information.

ITEM 8.3 PAGE1 9/3/2024

LEAGUE OF

CALIFORNIA
CITIES
Council Action Advised by September 25, 2024
DATE: Wednesday, July 10, 2024
TO: Mayors, Council Members, City Clerks, and City Managers RE: DESIGNATION OF VOTING DELEGATES AND ALTERNATES
League of Callfornla CHles Annual Conference and Expo, Oct. 16-18, 2024 Long Beach Convention Center
Every year, the League of California Cities convenes a member-driven General Assembly at the Cal Cities Annual Conference and Expo. The General Assembly is an important opportunity where city officials can directly participate in the development of Cal Cities policy.

Ta king place on Oct. 18, the General Assembly is comprised of voting delegates appointed by each member city; every city has one voting delegate. Your appointed voting delegate plays an important role during the General Assembly by representing your city and voting on resolutions.

To cast a vote during the General Assembly, your city must designate a voting delegate and up to two alternate voting delegates, one of whom may vote if the designated voting delegate is unable to serve in that capacity. Voting delegates may either be an elected or appointed official.

Action by Council Required. Consistent with Cal Cities bylaws, a city's voting delegate and up to two alternates must be designated by the city council. Please note that designating the voting delegate and alternates must be done by city council action and cannot be accomplished by individual action of the mayor or city manager alone.

Following council action, please submit your city's delegates through the online submission portal by Wed., Sept. 25. When completing the Voting Delegate submission form, you will be asked to attest that council action was taken. You will need to be signed in to your My Cal Cities account when submitting the form.

Submitting your voting delegate form by the deadline will allow us time to establish voting delegate/alternate records prior to the conference and provide pre-conference communications with voting delegates.

Conference Registration Required. The voting delegate and alternates must be registered to attend the conference. They need not register for the entire conference; they may register for Friday only. Conference registration is open on the Cal Cities website.
- -
l•.00 K Sl1ccl, Suite ,100 Sric1c1rncn1o, CA '7581-1 • '716 658 8200 • c cilc1t1es 019

LEAGUE OF

CALIFORNIA
CITIES
For a city to cast a vote, one voter must be present at the General Assembly and in possession of the voting delegate card and voting tool. Voting delegates and alternates need to pick up their conference badges before signing in and picking up the voting delegate card at the voting delegate desk. This will enable them to receive the special sticker on their name badges that will admit the voting delegate into the voting area during the General Assembly.

Please view Cal Cities' event and meeting policy in advance of the conference.

Transferring Voting Card to Non-Designated Individuals Not Allowed. The voting delegate card may be transferred freely between the voting delegate and alternates, but only between the voting delegate and alternates. If the voting delegate and alternates find themselves unable to attend the General Assembly, they may not transfer the voting card to another city official.

Seating Protocol during General Assembly. At the General Assembly, individuals with a voting card will sit in a designated area. Admission to the voting area will be limited to the individual in possession of the voting card and with a special sticker on their name badge identifying them as a voting delegate.

The voting delegate desk, located in the conference registration area of the l ong Beach Convention Center in Long Beach, will be open at the following times: Wednesday, Oct. 16, 8:00 a.m.-6:00 p.m. and Thursday, Oct. 17, 7:30 a.m.-4:00 p.m. On Friday, Oct. 18, the voting delegate desk will be open at the General Assembly, starting at 7:30 a.m., but will be closed during roll calls and voting.

The voting procedures that will be used at the conference are attached to this memo.

Please share these procedures and this memo with your council and especially with the individuals that your council designates as your city's voting delegate and alternates.

Once again, thank you for submitting your voting delegate and alternates by Wednesday, Sept. 25. If you have questions, please contact Zach Seals at [email protected].

Attachments:
• General Assembly Voting Guidelines
• Information Sheet: Cal Cities Resolutions and the General Assembly - ---------- -
) .~oo I'. St, ee I, Sui I e •100, Soc• o r n,~n to C/\ 9581 ,1 • 91 6 658 8200 • cc'c1t10s org

LEAGUE OF

CALIFORNIA
CITIES
General Assembly Voting Guidelines

1. One City One Vote. Each member city has a right to cast one vote on matters pertaining to Cal Cities policy.

2. Designating a City Voting Representative. Prior to the Cal Cities Annual Conference and Expo, each city council may designate a voting delegate and up to two alternates: these individuals are identified on the voting delegate form provided to the Cal Cities Credentials Committee.

3. Registering with the Credentials Committee. The voting delegate, or alternates, may pick up the city's voting card at the voting delegate desk in the conference registration area. Voting delegates and alternates must sign in at the voting delegate desk. Here they will receive a special sticker on their name badge and thus be admitted to the voting area at the General Assembly.

4. Signing Initiated Resolution Petitions. Only those individuals who are voting delegates (or alternates), and who have picked up their city's voting card by providing a signature to the credentials committee at the voting delegate desk, may sign petitions to initiate a resolution.

5. Voting. To cast the city's vote, a city official must have in their possession the city's voting card and voting tool; and be registered with the credentials committee. The voting card may be transferred freely between the voting delegate and alternates but may not be transferred to another city official who is neither a voting delegate nor alternate.

6. Voting Area at General Assembly. At the General Assembly, individuals with a voting card will sit in a designated area. Admission to the voting area will be limited to the individual in possession of the voting card and with a special sticker on their name badge identifying them as a voting delegate.

7. Resolving Disputes. In case of dispute, the credentials committee will determine the validity of signatures on petitioned resolutions and the right of a city official to vote at the General Assembly.
- --- ---- ------
l'100 K Street. Suile ',00 Sociciinento. CA 958 I ,j • 916 658 8200 • cc:lcit,es org

LEAGUE OF

CALIFORNIA
CITIES
How it works: Cal Cities
Resolutions and the General Assembly
Developing League of California Cities policy is a dynamic process that engages a wide range of members to ensure Cal Cities represents cities with one voice. These policies directly guide Cal Cities' advocacy to promote local decision-making, and lobby against statewide policies that erode local control.

The resolutions process and General Assembly is one way that city officials can directly participate in the development of Cal Cities policy. If a resolution is approved at the General Assembly, it becomes official Cal Cities policy. Here's how resolutions and the General Assembly work.

General Resolutions
Sixty days before the
~ Annual Conference
and Expo. Cal Cities
members may submit
policy proposals on -+
issues of importance
to cities. The resolution must
have the concurrence of at least
five additional member cities or
individual members.

Policy Committees
• • • The Cal Cities
Q President assigns
general resolutions
to policy committees
where members
review, debate, and recommend
positions for each policy proposal.

Recommendations are forwarded
to the Resolutions Committee.

During the Annual Conference and Expo
Petitioned Resolutions
The petitioned
resolution is an
alternate method
to introduce policy
proposals during ______.._
the annual conference. The _,,...
petition must be signed by
voting delegates from I 0% of
member cities. and submitted to
the Cal Cities President at least
24 hours before the beginning
of the General Assembly.

General Assembly
Resolutions Committee
• • • The Resolutions
Q Committee considers
all resolutions. General
Resolutions approved' by
either a policy committee
or the Resolutions Committee are next
considered by the General Assembly.

General resolutions not approved. or
referred for further study by both a
policy committee and the Resolutions
Committee do not go to the General
Assembly. All Petitioned Resolutions
are considered by the General
Assembly, unless disqualified.i
•·
During the General Assembly, voting delegates
debate and consider general and petitioned
resolutions forwarded by the Resolutions
Committee. Potential Cal Cities bylaws
amendments are also considered at this meeting.

The Resolution Committee con omend a general resolulion prior to sending ii to !he General Assembly.

Who's who
Cal Cities policy
development is a memberinformed process,
grounded in the voices and
experiences of city officials
throughout the state.

The Resolutions Committee
includes representatives
from each Cal Cities
diversity caucus, regional
division, municipal
department, and policy
committee. as well as
individuals appointed by
the Cal Cities president.

Voting delegates
are appointed by each
member city; every city
has one voting delegate.

The General Assembly is a
meeting of the collective
body of all voting
delegates -one from
every member city.

Seven policy committees
meet throughout the year
to review and recommend
positions to take on bills
and regulatory proposals.

Policy committees include
members from each Cal
Cities diversity caucus,
regional division, and
municipal department,
as well as individuals
appointed by the Cal
Cities president.
' Petitioned Resolutions may be disqualified by the Resolutions Committee a ccording lo Col Cities Bylaws Article VI. Sec. 5(f).

For more information visit www.calclties.org/general-assembly

AGENDA ITEM
~eptember 3, 2024, City Council Meetin~
To:

Through:

Honorable Mayor and Members of the Anderson City Council Joey Forseth-Deshais, City Manager
From: Cindy Wheeler, Finance Director
Date: September 3, 2024
!SUBJECT
2022-2023 Annual Comprehensive Financial Report
jRECOMMENDATION
The Finance Director recommends that the City Council:

1. Receive a presentation from the City's contracted auditor, Frances Kuo of The Pun Group

2. Receive and file the annual financial report.

I FISCAL IMPACT
There is no fiscal impact of the proposed receive and file action.

ITEM 8.5 PAGE1 9/3/2024
I DISCUSSION and BACKGROUND
Introduction
Each year, the City Finance Director prepares an Annual Comprehensive Financial Report, or Annual Report, to serve multiple purposes, including presentation of financial data to the City Council and many other interested parties. The Pun Group (TPG) audited these financial statements.

Audit Committee
On April 18, 2006, the City Council adopted Ordinance No. 740, establishing an Audit Committee. In accordance with this ordinance, the Mayor and Vice Mayor are members of the Audit Committee. Also, in accordance with this ordinance, the City Manager appointed the Auditor-Controller for Shasta County, as the third member of the Audit Committee to serve as the outside member of the Audit Committee with expertise in public accounting and finance. Nolda Short, the Auditor-Controller attended the Audit Committee meeting.

Also, attending the Audit Committee meeting this year were TPS Partner Frances Kuo and Suzette Reyes, the Finance Director, and the Accountant. The audit committee met on August 12, 2024. Items discussed were the City financial statements for the year ended June 30, 2023, the accompanying management discussion and analysis, and preparations for the planned 2023-2024 audit.
2022-2023 Hi~hlimts
The Finance Director would like to take this opportunity to briefly review the highlights of the Annual Report for the fiscal year ended June 30, 2023, with the City Council. A public review copy of the Annual Report is also available in the City Clerk's Office.

Highlights of the 2022-2023 Annual Report include:
■ Clean Audit Opinion. Independent auditing firm The Pun Group audited the City's financial statements for the fiscal year ending June 30, 2023. TPG provided the City with an unqualified audit opinion letter, indicating that the financial statements fairly reflect the City's financial condition on June 30, 2023. TPG will be attending the Council meeting this evening if there are any questions for Frances Kuo about the audit services provided.
• General Fund Results. For purposes of financial statement presentation, the General Fund is comprised of the following funds: General, Mosquito Serenade, Teen Center, PEG Fees. General Fund expenditures exceeded General Fund revenues by $1,170,110, which resulted in a decrease to General Fund Reserves. The year-end General Fund reserve decreased to $4,726,092 of which $285,815 is non-spendable, $275,688 is assigned, and $4,164,589 is unassigned. Expressed as a percentage of annual General Fund expenditures of $13,073,879, the unassigned General Fund reserve balance stood at 31 % on June 30, 2023, above the Council goal of 20% to 25% of expenditures. • This decrease in General Fund reserves is largely due to decreases in Transient Occupancy Tax, licensing and permits, and charges for services.

ITEM 8.5 PAGE2 9/3/2024
• Overall, Sales Tax revenues increased from the 2021-2022 fiscal year by 9%, Transient Occupancy Tax decreased by 1.2% in 2022-2023, and Property Tax revenue increased by 9% in 2022-2023.
■ Gas Tax Fund Results. Gas Tax Fund expenditures exceeded Gas Tax Fund revenues net transfers by $406,663 in fiscal year 2022-2023. The year-end Gas Tax Fund balance decreased to $1,514,677.
• Former Anderson Redevelopment Agency Funds. The Anderson Redevelopment Agency (ARA) was dissolved as of January 31, 2012, per AB lX 26. For more information and details, please see Note 12 of the Financial Statements. • Proprietary Funds Results. Proprietary funds experienced a change in net position before contributions and transfers as follows:

Water Fund
Sewer Fund
Internal Service Funds
$(625,780)
$(566,706)
$(460,165)
Total Net Position $3,744,014
Total Net Position $5,965,053
Total Net Position $(1,127,772)
• GASB 68. The City is reporting a Net Pension Liability of $15,749,590. This is an increase of $7,045,636 from the prior year. To gain perspective on this liability, the City of Anderson reports a Net Position of $45,493,665; the Miscellaneous Group reported a Net Pension Liability of $9,681,762, and the Safety Group reported $6,067,828. The City also reported a pension expense of $1,776, 790. TPG will provide additional detail on the reporting of the Net Pension Liability or GASB 68. Please see Note 8 in the financial statement for more information regarding pension reporting. • GASB 87. In the fiscal year 2021-2022, the City implemented GASB Statement 87, Leases. GASB 87 requires financial reporting of certain lease assets and liabilities. For information on GASB 87 see Note 6.
• GASB 91, 94, 96, & 99. These GASB standards implemented in the fiscal year 2022- 2023 were to report Conduit Debt Obligations, Public-Private and Private-Public Partnerships and Availability Payment Arrangements, Subscription-Based Information Technology Arrangements, And Omnibus 2022, respectively. These four standards are discussed further in Note 1 Section V., as well as Notes 5 & 6. • Recommendations in Management Letters. In the fiscal year 2022-2023 audit, TPG had no recommendations for strengthening the internal controls. Management agrees; however, we intend to implement processes in the coming years to increase clarity and efficiency in reporting, which will strengthen internal controls.

Thanks and Appreciation
The Finance Director would like to take this opportunity to thank The Pun Group audit personnel and the employees of the Finance Department for their work in the preparation of the financial statements, in addition to planning and performing the annual audit. The ITEM 8.5 PAGE3 9/3/2024
Finance Director would also like to thank Mayor Neutze, Vice Mayor Hunt, and Nolda Short for their valuable contributions to the Audit Committee.

I ATTACHMENTS

1. Annual Comprehensive Financial Report for Fiscal Year Ended June 30, 2023.

2. Letter to the Audit Committee.

3. GANN final report
ITEM 8.5 PAGE4 9/3/2024

CITY OF ANDERSON
Annual Comprehensive Financial Report
Fiscal Year 2022-2023

City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
Table of Contents
Page
INTRODUCTORY SECTION (Unaudited)
Letter of Transmittal ................................................................................................................................................ i Organization Chart ................................................................................................................................................. v Officials of the City of Anderson, California ........................................................................................................ vi

FINANCIAL SECTION
Independent Auditors’ Report on the Financial Statements ............................................................................ 1 Management’s Discussion and Analysis (Required Supplementary Information) (Unaudited) ................... 5 Basic Financial Statements:

Government-Wide Financial Statements:

Statement of Net Position ........................................................................................................................ 16 Statement of Activities ............................................................................................................................ 18 Fund Financial Statements:

Governmental Fund Financial Statements:

Balance Sheet .................................................................................................................................... 24 Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position .................................................................. 27 Statement of Revenues, Expenditures, and Changes in Fund Balances ........................................... 28 Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the
Government-Wide Statement of Activities and Changes in Net Position .................................. 30 Proprietary Fund Financial Statements:

Statement of Net Position ................................................................................................................. 32 Statement of Revenues, Expenses, and Changes in Net Position ..................................................... 35 Statement of Cash Flows .................................................................................................................. 36 Fiduciary Fund Financial Statements:

Statement of Fiduciary Net Position ................................................................................................. 41 Statement of Changes in Fiduciary Net Position .............................................................................. 42 Index to Notes to the Basic Financial Statements .......................................................................................... 45 Notes to the Basic Financial Statements ........................................................................................................ 47 City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
Table of Contents (Continued)
Page
FINANCIAL SECTION (Continued)
Required Supplementary Information (Unaudited):

Budgetary Comparison Schedule – General Fund ......................................................................................... 87 Budgetary Comparison Schedule – Gas Tax Special Revenue Fund............................................................. 88 Budgetary Comparison Schedule – ADAP and Home Special Revenue Fund .............................................. 89 Budgetary Comparison Schedule – CDBG Special Revenue Fund ............................................................... 90 Budgetary Comparison Schedule – Low and Moderate Income Housing Special Revenue Fund ................ 91 Notes to the Budgetary Comparison Schedule .............................................................................................. 93 Schedule of the City's Proportionate Share of the Net Pension Liability and Related Ratios ....................... 94 Schedule of Contributions – Pensions ........................................................................................................... 96

Supplementary Information:

Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget to Actual – Riverside East Debt Service Fund .......................................................................... 101 Nonmajor Governmental Funds:

Combining Balance Sheet ..................................................................................................................... 104 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances ............................. 109 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual:

Street Lighting Special Revenue Fund............................................................................................ 114 COPS and LLEBG Grants Special Revenue Fund ......................................................................... 115 EDBG Special Revenue Fund ......................................................................................................... 116 South Ridge Assessment District Special Revenue Fund ............................................................... 117 Vineyard Lighting and Landscape Special Revenue Fund ............................................................. 118 Silvergate Sanitary Assessment District Special Revenue Fund .................................................... 119 Police Facility and Corp Yard Capital Project Fund ....................................................................... 120 Drainage Capital Project Fund ........................................................................................................ 121 Parks Capital Project Fund .............................................................................................................. 122 Sewer Capital Project Fund ............................................................................................................ 123 Water Capital Project Fund ............................................................................................................. 124 Traffic Capital Project Fund ........................................................................................................... 125 I-5/Deschutes Offramp Capital Project Fund .................................................................................. 126 Custodial Funds:

Combining Statement of Fiduciary Net Position ................................................................................... 129 Combining Statement of Changes Fiduciary Net Position .................................................................... 130 City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
Table of Contents (Continued)
STATISTICAL SECTION (Unaudited)
Financial Trend:

Net Assets – Accrual Basis of Accounting .................................................................................................. 134 Changes in Net Assets – Accrual Basis of Accounting ............................................................................... 136 Fund Balances of Governmental Funds – Modified Accrual Basis of Accounting ..................................... 140 Changes in Fund Balances of Governmental Funds – Modified Accrual Basis of Accounting .................. 142 General Fund Balance Compared to Annual Appropriations ...................................................................... 144 General Fund Revenues by Source .............................................................................................................. 145 General Fund Tax Revenues by Source ....................................................................................................... 147 Governmental Funds Expenditures by Function .......................................................................................... 148 Special Assessment Billings and Collections .............................................................................................. 151 Revenue Capacity:

Property Tax – Rates (Direct and Overlapping Governments) and City Levies and Collections ................ 152 Assessed Value and Estimated Actual Value of Taxable Property .............................................................. 154 Principal Secured Property Taxpayers ......................................................................................................... 155 Property Value and Construction ................................................................................................................. 157 Debt Capacity:

Ratio of Outstanding Debt by Type ............................................................................................................. 158 Ratio of General Bonded Debt Outstanding – Last Ten Fiscal Years ......................................................... 160 Ratio of Net Bonded Debt to Assessed Value and Net Bonded Debt per Capita ........................................ 161 Ratio of Annual Debt Service for Bonded Debt to Total General Expenditures ......................................... 162 Direct and Overlapping Governmental Activities Debt ............................................................................... 163 Computation of Legal Debt Margin ............................................................................................................. 164 Pledged Revenue Coverage ......................................................................................................................... 166 Demographic and Economic Information:

General Information ..................................................................................................................................... 167 Principal Employers ..................................................................................................................................... 168 Economic Information ................................................................................................................................. 169 Operating Information:

Operating and Capital Indicators ................................................................................................................. 171 Authorized Full-Time Equivalent Employees by Department ..................................................................... 172 Water and Sewer Rates ................................................................................................................................ 174 City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
(This page is intentionally left blank)
i
August 29, 2024
Honorable Mayor and Members of the City
Council and Citizens of the City of Anderson:

State law requires that all general-purpose local
governments publish a complete set of financial
statements presented in conformity with
accounting principles generally accepted in the
United States of America (GAAP) and audited
in accordance with generally accepted auditing
standards by a firm of licensed certified public
accountants. Pursuant to that requirement, we
hereby issue for the City of Anderson (the
“City”) the Annual Comprehensive Financial
Report for the fiscal year ended June 30, 2023.

This report consists of management’s
representations concerning the finances of the
City. Consequently, management assumes full
responsibility for the completeness and
reliability of all of the information presented in
this report. To provide a reasonable basis for
making these representations, management of
the City has established a comprehensive
internal control framework that is designed both
to protect the government’s assets from loss,
theft, or misuse and to compile sufficient
reliable information for the preparation of the
City’s financial statements in conformity with
GAAP. Because the cost of internal controls
should not outweigh their benefits, the City’s
comprehensive framework of internal controls
has been designed to provide reasonable rather
than absolute assurance that the financial
statements will be free from material
misstatement. As management, we assert that, to
the best of our knowledge and belief, this
financial report is complete and reliable in all
material respects.

The City’s financial statements have been
audited by The Pun Group, a firm of licensed
certified public accountants. The goal of the
independent audit was to provide reasonable
assurance that the financial statements of the
City for the fiscal year ended June 30, 2023, are
free of material misstatement. The independent
audit involved examining, on a test basis,
evidence supporting the amounts and disclosures
in the financial statements; assessing the
accounting principles used and significant
estimates made by management; and evaluating
the overall financial statement presentation. The
independent auditor concluded, based upon the
audit, that there was a reasonable basis for
rendering an unqualified opinion that the City’s
financial statements for the fiscal year ended
June 30, 2023, are fairly presented in conformity
with GAAP. The independent auditors’ report is
presented as the first component of the financial
section of this report.

GAAP requires that management provide a
narrative introduction, overview, and analysis to
accompany the basic financial statements in the
form of Management’s Discussion and Analysis
(MD&A). This letter of transmittal is designed
to complement MD&A and should be read in
conjunction with it. The City’s MD&A can be
found immediately following the report of the
independent auditors.

General Information
The City has a population of 11,164 and is
located on the west bank of the Sacramento
River in southern Shasta County. It is ten miles
south of Redding, population 92,727, and twenty
miles north of Red Bluff, population 14,413
Anderson is situated along Interstate 5 and is
150 miles north of Sacramento, the state capital.

The City was incorporated January 16, 1956, as
a general law city and it employs the councilmanager form of government. The governing council is responsible, among other things, for
passing ordinances, adopting the budget and
appointing committees. The Council appoints a
ii
City Attorney as legal counsel and a City
Manager who is the administrative head of the
government. The City Manager is responsible
for carrying out the policies and ordinances of
the governing council, for overseeing day-to-day
operations of the government, and for appointing
the heads of the various departments. The
council is elected on a non-partisan basis.

Council members serve four-year staggered
terms, with either two or three council members
elected every two years. The council from its
members selects a Mayor and Vice-mayor.

The City provides a full range of services,
including police, the maintenance of streets and
other infrastructure, recreational activities and
cultural events. The City also provides water and
sewer services to its citizens.

Factors Affecting Financial Condition
The information presented in the financial
statements is perhaps best understood when it is
considered from the broader perspective of the
specific environment within which the City
operates.

Local Economy
Historically, the Anderson local economy has
been primarily influenced by wood and lumber
related industries. Of the 13 largest
manufacturers in 1990, ten were directly
involved in wood products processing and
accounted for 2,000 of the total 2,112
manufacturing related jobs in the greater
Anderson area. Mill closures culminating in the
2001 closure of the Shasta Paper Company
resulted in the elimination of many of these jobs;
however, numerous jobs have been created in
retail and tourist related businesses. Also, a
number of new jobs have been developed in
non-timber related manufacturing. While the
timber is still very important and the City
continues to actively promote the unique
characteristics of the community that make it
attractive to timber product industries, the local
economy is increasingly influenced by nontimber related businesses.

In 1999, the City annexed 186 acres of
industrially zoned property in the Ox Yoke Road
area with the intention of encouraging the
diversification of manufacturing.

In 2000, the Anderson Redevelopment Agency
formed the Southwest Redevelopment Project
Area. Since that time, the City has actively used
redevelopment funding to make substantial
improvements to the downtown area, facilitate
private development through land acquisition
and sale, and construction of infrastructure
improvements. In 2011, the California Supreme
Court upheld AB1X 26 dissolving
Redevelopment Agencies. Note 14 contains
detailed information about Redevelopment
Dissolution.

Inflation is a concern that we will be monitoring
closely in the next fiscal year. The City is
continuing to experience a slowing in single
family home sales and residential construction;
however, new construction projects for vehicle
and equipment sales, fuel stations, restaurants,
and a national equipment rental chain. Several
projects are also being completed in our
planning department, including hotels,
manufacturing, fuel stations, affordable housing
and a full-service car wash.

Accounting, Budgetary and Loss Control
Fund Accounting
The City’s accounting system is organized and
operated on a “fund basis.” A fund is defined as
a fiscal accounting entity with a self-balancing
set of accounts. Individual funds are used for the
purpose of carrying out specific activities or
attaining certain objectives. The accounting
system has been developed to make it possible
to present fairly and with full disclosure the
financial position and results of financial
operations of each fund. Additional information
about the City’s use of fund accounting is in
note 1 to the financial statement.

Internal Control
The City’s general policies and procedures are
designed to reasonably safeguard its assets,
check the reliability of its accounting data and
iii
promote operational efficiency. We believe that
the City’s internal accounting controls
adequately safeguard assets and provide
reasonable assurance of proper recording of all
financial transactions.

Budgetary Control
In June of odd numbered years, the City Council
considers and adopts a budget plan for the
coming two fiscal years. In June of each fiscal
year, appropriations are adopted for the
upcoming fiscal year for each fund and for
departmental units within each fund. Budgetary
control is maintained at the fund level; the City
Manager may transfer appropriations between
accounts in each fund. However, any revision
that alters the total expenditure level of a fund
must be approved by the City Council.

Additional information about the City’s budget
policies can be found in Note 1 to the financial
statements.

Cash Management
The City of Anderson follows the practice of
pooling temporarily idle cash during the year.

Monies not required for immediate expenditure
are invested in accordance with State law and
the City’s formal investment policy. These
monies were invested in demand deposits, U.S.

Government securities, and the Local Agency
Investment fund. Notes 1 and 2 to the financial
statements contain additional information.

Fiduciary Operations
The City maintains a number of fiduciary funds,
which contain assets held in trust for other
agencies.

Fixed Assets
The general fixed assets of the City are those
fixed assets used in the performance of general
governmental functions and exclude the fixed
assets of Enterprise fund. As of June 30, 2023,
the City’s capital assets, including both
governmental and business-type, amounted to
$37,769,350. Note 5 to the financial statements
contain additional information about fixed
assets.

Debt Obligations
The City uses lease-purchase financing and
certificates of participation, as well as traditional
debt instruments, when deemed appropriate.

The City has neither outstanding general
obligation bonds nor authorized but unused
general obligations bonds at this time. A
complete description of all outstanding debts can
be found in Note 6 to the financial statements.

Risk Management
The City is a member of the Northern California
Cities Self-Insurance Fund, a Joint Powers
Authority providing its member cities a shared
risk plan for worker’s compensation and liability
insurance. The City’s Workers’ Compensation
Program comprises a banking or deductible
layer for claims up to $100,000 and a shared risk
pool for claims from $100,000 to $500,000.

Excess coverage is provided for claims over the
shared risk layer up to the statutory limit. The
Liability Program comprises a banking or
deductible layer for claims up to $50,000, and a
shared risk pool for claims from $50,000 to
$500,000. Excess coverage is provided for
claims over the shared risk layer up to
$40,000,000. A complete discussion of the
City’s worker’s compensation and liability
insurance programs is in Note 7 to the financial
statements.

Pension Benefits
The City of Anderson contributes to the
California Public Employees Retirement System
(PERS), an agent multiple-employer public
employee defined benefit pension plan. PERS
provides retirement and disability benefits,
annual cost-of-living adjustments and death
benefits to plan members and beneficiaries. A
complete discussion of the City’s retirement
plan is in Note 8 to the financial statements.

Acknowledgements
The City's fiscal condition remains strong. This
is not achieved without the commitment and
leadership of the City Council and City
Manager, as well as the cooperation of all
department heads and employees. I would
especially like to thank the entire staff of the
iv
Finance Department for their dedication to
processing the daily fiscal transactions of the
City in an efficient manner. Without their hard
work and dedication, this Financial Statement
would not be possible.

Cindy Wheeler
Finance Director/Treasurer
City of Anderson Organization Chart

CITIZENS OF ANDERSON

MAYOR & CITY COUNCIL

CITY ATTORNEY BOARDS & COMMISSIONS

CITY MANAGER

CITY CLERK

FINANCE POLICE RECREATION PUBLIC
WORKS

DEVELOPMENT

SERVICES
Public InformationCity Council SupportPersonnelRisk Management PurchasingUtility BillingFinancePayroll TreasuryInformation Systems Operational ServicesPatrolInvestigation CommunicationsAnimal Control RecreationSenior ServicesYouth Programs
EngineeringStreetsWaterWastewaterVehicle MaintainanceParks Building Community Development PlanningZoning

ASSISTANT CITY MANAGER
Grant Administration RedevelopmentHousing
v
vi

OFFICIALS OF THE CITY OF ANDERSON, CALIFORNIA
FISCAL YEAR 2022 - 2023

CITY OF ANDERSON

CITY COUNCIL
Mike Gallagher, Mayor
Stan Neutze, Vice Mayor
Susie Baugh, Councilmember
Dan Gallier, Councilmember
Melissa Hunt, Councilmember
Administration Officials and Department Heads
Administrative Service Manager ............................................ Nichole McCollum Assistant City Manager/Finance Director ............................... Liz Cottrell Chief Wastewater Treatment Operator ................................... Nick Jones City Clerk ................................................................................ Christy White City Manager ........................................................................... Jeff Kiser Deputy Public Works Director ................................................ Peter Wickenheiser Finance Office Manager.......................................................... Cindy Wheeler Lieutenant ................................................................................ Steve Blunk Police Chief ............................................................................. Jon Poletski Public Works Superintendent ................................................. Eric Knight Public Works Director ............................................................ Adam Whelen Director of Operations & Administration ............................... Jennifer McDaniel 200 E. Sandpointe Avenue, Suite 600
Santa Ana, California 92707
INDEPENDENT AUDITORS’ REPORT
To the Honorable Mayor and the Members of the City Council of the City of Anderson
Anderson, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Anderson, California (the “City”), as of and for the year ended June 30, 2023, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2023, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinions
We 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 Auditors’ 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 requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Other Matters
Change in Accounting Principle
As described in Note 1 to the financial statements, the City adopted new accounting guidance, Governmental Accounting Standards Board (“GASB”) Statement No. 96, Subscription-Based Information Technology Systems. Our opinion is not modified with respect to this matter.

Management’s Responsibility for the Financial Statements Management 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 financial statements that are free from material misstatement, whether due to fraud or error.

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 City’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.
(Yllll
www.pungroup.cpa g
ORANGE COUNTY • SAN DIEGO • SACRAMENTO • WALNUT CREEK • LAS VEGAS • PHOENIX 000 To the Honorable Mayor and the Members of the City Council of the City of Anderson
Anderson, California

Page 2 ends

2 Auditors’ Responsibilities for the Audit of the Financial Statements Our 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 auditors’ 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 auditing standards generally accepted in the United States of America 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.

In performing an audit in accordance with auditing standards generally accepted in the United States of America and Government Auditing Standards, we:
 Exercise professional judgment and maintain professional skepticism throughout the audit.  Identify 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. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.  Obtain 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. Accordingly, no such opinion is expressed.  Evaluate 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.  Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.

We 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.

Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management’s Discussion and Analysis, the Schedule of Changes in Net Pension Liability and Related Ratios, the Schedule of City’s Proportionate Share of the Net Pension Liability and Related Ratios and the Schedules of Contributions – Pensions, as listed in the table of contents be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the Required Supplementary Information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

To the Honorable Mayor and the Members of the City Council of the City of Anderson
Anderson, California

Page 3 ends

3 Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The accompanying combining and individual nonmajor fund financial statements are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial statements are fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Information
Management is responsible for the other information included in the annual report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditors’ report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.

In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated August 29, 2024, on our consideration of the City’s internal control over financial reporting 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.

Santa Ana, California
August 29, 2024
and Analysis
4 City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
(This page is intentionally left blank)
5 MANAGEMENT’S DISCUSSION AND ANALYSIS
City of Anderson
MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)
June 30, 2023
6 INTRODUCTION
This section of the Annual Comprehensive Financial Report provides a narrative overview and analysis of the financial activities of the City of Anderson (the “City”) for the fiscal year ended June 30, 2023. This should be read in conjunction with the transmittal letter and the financial statements.

FINANCIAL HIGHLIGHTS
 The assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows of resources on June 30, 2023, by $45.49 million (net position). Due to the implementation of GASB 68, net pension liabilities are reported on the financial statements. Reporting of the City’s net pension liability of $14.39 million resulted in an unrestricted net position of ($7,499,502) in Governmental Activities.  Total net position decreased by $1.33 million, with a decrease of $.20 million in net assets of governmental activities, and a decrease of $1.13 million in business-type activities.  Governmental funds reported combined June 30, 2023, fund balances of $22.45 million, a decrease of $.80 million in comparison to the previous fiscal year. These fund balances are largely reserved for various purposes.
 As of June 30, 2023, the General Fund had a year-end unassigned fund balance of $4,168,886, a decrease of 26% over the prior year’s unassigned fund balance of $5,612,910. The decrease is largely due to the receipt of American Rescue Act Funds in fiscal year 2022. The unassigned General Fund balance on June 30, 2023, represented 32% of 2022-2023 General Fund expenditures of $13,073,878.  As of June 30, 2023, the Gas Tax Fund had a year-end restricted fund balance of $1,514,667. The restricted Gas Tax Fund balance at June 30, 2023, represented 78% of 2022-2023 Gas Tax Fund expenditures of $1,945,731. The restricted Gas Tax Fund balance decreased by $406,663, from June 30, 2022 to June 30, 2023.
 During the fiscal year ended June 30, 2023, the City’s net long-term liabilities increased by $79,506 with an ending long-term liability balance of $4,797,230 (See Note 6).

City of Anderson
MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) (CONTINUED) June 30, 2023
7 OVERVIEW OF THE FINANCIAL HIGHLIGHTS
The basic financial statements are comprised of three components:

1. Government-wide financial statements,

2. Fund financial statements, and

3. Notes to the financial statements.

This report also includes other supplementary information section that presents required reports on internal controls and compliance with laws and regulations.

GOVERNMENT-WIDE FINANCIAL STATEMENTS
This set of statements is designed to provide readers with a broad overview of the City’s finances, in a manner similar to a private-sector business.

The Statement of Net Position (Statement 1) presents information on all the City’s assets and liabilities, with the difference reported as net position. Over time, increases or decreases in net position may serve as an indicator of whether the financial position of the City is improving or declining.

The Statement of Activities (Statement 2) presents information showing how the government’s net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods, such as for uncollected taxes and earned but not yet used vacation time.

Both of the government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees or are required by grantor agencies to be accounted for in this fashion (business-type activities). The governmental activities include general government, public safety, public works, planning, community development, recreation and cultural. The business-type activities of the City are water and sewer.

The government-wide financial statements include not only the City itself (known as the primary government) but also its component units, entities for which the government is considered to be financially responsible. Blended component units, although legally separate entities are in substance, part of the government’s operations and so data from these units are combined with data of the primary government.

On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X 26 dissolving all redevelopment agencies in the State of California. (See Note 12 for detailed information on the reporting of the former Anderson Redevelopment Agency). The City elected to become the Successor Agency to the dissolved Anderson Redevelopment Agency. Information on Successor Agency Funds are reported as a component unit of the City.

City of Anderson
MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) (CONTINUED) June 30, 2023
8 FUND FINANCIAL STATEMENTS
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All the funds of the City can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds.

Governmental Funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term financing requirements.

Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impacts of the government’s near-term decisions. Both the governmental fund balance sheet and the government fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.

The City maintains 30 individual governmental funds. Information is presented separately in the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances for the General Fund, the Gas Tax Fund, the ADAP and Home Fund, the CDBG Fund, the Riverside East Debt Service Fund, and all of which are considered major funds. Data from the other governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these non-major governmental funds is provided in the form of combining statements elsewhere in this report.

The City adopts annual appropriations for its major governmental funds. As required supplementary statements, budgetary comparison statements have been provided for the General Fund and Major Special Revenue Funds to demonstrate compliance with adopted appropriations. The basic governmental fund financial statements can be found on pages 24-30 of this report.

Proprietary Funds. The City maintains enterprise and internal service proprietary funds.

Enterprise funds are used to report the same functions as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its water and sewer enterprises. Both of the City’s enterprise funds are considered major funds.

Internal service funds are an accounting device used to accumulate and allocate costs internally among the City’s various functions. The City uses its Internal Service Fund to account for public works charges to other departments, maintenance of the City’s vehicle fleet, maintenance of the City’s buildings and equipment, maintenance of the City’s computer systems, and charges for workers’ compensation and general liability insurance. Because these services primarily benefit governmental rather than business-type functions, they have been included within governmental activities in the government-wide financial statements.

Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The City’s Enterprise and Internal Service Fund are shown in detail on pages 32-37 of this report.

City of Anderson
MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) (CONTINUED) June 30, 2023
9 Fiduciary Funds. Fiduciary funds are used to account for resources held for the benefit of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statement because the resources of those funds are not available to support the City’s own programs. The accounting used for fiduciary funds is much like that use for proprietary funds. The basic fiduciary fund financial statements can be found on pages 41-42 of this report.

Notes to the Financial Statements. The notes provide additional important information that is essential to the reader for a full understanding of the data provided in the government-wide and fund financial statements.

GOVERNMENT-WIDE FINANCIAL ANALYSIS
Net position may serve over time as a useful indicator of a government’s financial position. For the City, assets exceeded liabilities by $45.49 million on June 30, 2023. Net position decreased by $1.33 million in the Fiscal Year 2022- 2023.

The City’s net position decreased in the governmental activities and decreased in the business-type activities during the 2022-2023 fiscal year. Net position in governmental activities decreased by $.20 million, and net position in business-type activities decreased by $1.13 million.

Changes in Net Position
2022 2022 2022
2023 (As restated) 2023 (As restated) 2023 (As restated) Revenues
Program revenues:

Charges for services 1,176,561 $ 1,214,879 $ 3,307,035 $ 3,386,670 $ 4,483,596 $ 4,601,549 $ Operating grants and contributions 3,191,953 2,948,528 - - 3,191,953 2,948,528 Capital grants and contributions - - 112,830 112,244 112,830 112,244 General revenues:

Taxes:

Sales taxes 6,667,218 6,231,941 - - 6,667,218 6,231,941 Property taxes 2,648,530 2,518,241 - - 2,648,530 2,518,241 Motel taxes 665,909 775,875 - - 665,909 775,875
Special gas taxes - 1,200,065 - - - 1,200,065
Franchise taxes 392,561 389,396 - - 392,561 389,396
Other taxes 69,678 63,872 - - 69,678 63,872
Impact fees - 643,803 - - - 643,803
Investment earnings 59,496 88,646 26,982 6,882 86,478 95,528 Capital contributions - - - 483,211 - 483,211
Transfers 48,953 105,244 (48,953) (105,244) - -
Total revenues 16,180,490 14,920,859 3,397,894 3,883,763 18,318,753 20,064,253 Expenses
General government 1,241,404 756,400 - - 1,241,404 756,400 Public safety 6,599,310 8,372,341 - - 8,372,341 6,599,310 Public works 1,963,880 2,003,092 - - 1,963,880 2,003,092 Planning 384,098 448,972 - - 448,972 384,098
Community development 1,393,766 1,937,249 - - 1,393,766 1,937,249 Recreation and cultural 1,687,109 1,770,062 - - 1,687,109 1,770,062 Water - - 2,153,066 1,368,342 2,153,066 1,368,342
Sewer - - 2,325,352 1,554,900 2,325,352 1,554,900
Interest and fiscal charges 63,459 - - - 63,459 -
Total expenses 13,450,211 15,170,931 4,478,418 2,923,242 19,649,349 16,373,453 Changes in net position (250,072) 2,730,279 (1,080,524) 960,521 (1,330,596) 3,690,800 Net position - beginning of year 35,888,338 33,158,059 10,935,921 9,975,400 46,824,259 43,133,459 Net position - end of year $ 35,888,338 35,638,266 $ 9,855,397 $ 10,935,921 $ 45,493,663 $ 46,824,259 $ Governmental Activities Business-type Activities Total Primary Government City of Anderson
MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) (CONTINUED) June 30, 2023
10 A large portion of the City’s net position $33,553,568, reflects the City’s investment in capital assets (e.g., land, buildings, machinery and equipment), less any related debt used to acquire those assets that are still outstanding. The City uses these assets to serve its citizens and businesses; consequently, these assets are not available for spending.

Although the City’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.

Another large portion of the City’s net position, $18,372,011 represents resources subject to external restrictions on how they may be used. Due to the implementation of GASB 68, the City is required to report net pension liability.

Reporting of net pension liability resulted in a ($7,499,502) deficit in governmental activities unrestricted net position.

Business-type activities reported $1,067,586 in unrestricted net position at year-end.

Net Position
2022 2022 2022
2023 (As restated) 2023 (As restated) 2023 (As restated) Assest
Current and other assets 22,072,567 $ 25,370,783 $ 3,168,225 $ 4,163,490 $ 25,240,792 $ 29,534,273 $ Capital assets 27,410,039 25,947,306 10,359,311 10,808,892 37,769,350 36,756,198 Total assets 51,318,089 49,482,606 13,527,536 14,972,382 63,010,142 66,290,471 Deferred outflows of resources 4,822,951 6,293,828 552,860 546,751 6,846,688 5,369,702 Liabilities
Long-term liabilities 17,540,040 10,282,790 1,050,360 2,495,882 18,590,400 12,778,672 Other liabilities 878,775 3,170,027 3,006,780 1,303,613 3,885,555 4,473,640 Total liabilities 13,452,817 18,418,815 4,057,140 3,799,495 22,475,955 17,252,312 Deferred inflows of resources 6,799,885 1,719,353 167,859 783,717 1,887,212 7,583,602 Net position
Net investments in capital assets 24,765,757 23,342,257 8,787,811 9,185,392 33,553,568 32,527,649 Restricted 18,372,011 16,142,307 - - 18,372,011 16,142,307 Unrestricted (deficit) (7,499,502) (3,596,226) 1,067,586 1,750,529 (6,431,916) (1,845,697) Total net position $ 35,888,338 35,638,266 $ 9,855,397 $ 10,935,921 $ 45,493,663 $ 46,824,259 $ Governmental Activities Business-type Activities Total Primary Government Governmental Activities. Primary Governmental activity expenses totaled $15.17 million in Fiscal Year 2022-2023.

Program revenues totaled $4.37 million. General revenues and transfers totaled $14.92 million. Sales tax revenue of $6.67 (63 percent) represented the largest share of general revenues and transfers.

Public safety activity expenses of $8.37 million represented the largest portion of governmental activity expenses (55 percent). Community development activity expenses of $1.39 million accounted for another 9 percent. Public works activity expenses of $1.96 million represented 13 percent. General government activity expenses of $1.24 million represented 8 percent, recreation and cultural activity expenses of $1.69 million represented 11 percent, and planning activity expenses of $0.45 million represented 3 percent.

Business-type Activities. Business-type activity expenses totaled $4.48 million in Fiscal Year 2022-2023. Charges for services totaled $3.31 million. Water enterprise expenses totaled $2.15 million, with charges for water services totaling $1.52 million. Sewer enterprise expenses totaled $2.33 million, with charges for sewer services totaling $1.79 million.

City of Anderson
MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) (CONTINUED) June 30, 2023
11 FINANCIAL ANALYSIS OF THE CITY’S FUNDS
As noted earlier in this discussion and analysis, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. These funds have been classified as governmental or proprietary.

Governmental funds. The focus of the City’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City’s financing requirements. In particular, unreserved fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year.

As of June 30, 2023, the City’s governmental funds reported combined ending fund balances of $22.45 million.

General Fund. The General Fund is the chief operating fund of the City. In 2022-2023, the City experienced an increase of General Fund revenues and other financing sources over General Fund expenses and other financing uses in the amount of $1,170,109. However, the year-end General Fund balance decreased by $1,219,405 to $4,730,389 which $285,815 is nonspendable, $275,688 is assigned, and $4,168,886 is unassigned.

Expressed as a percentage of annual expenditures, the unassigned General Fund balance stood at 32% of expenditures on June 30, 2023. The City’s unassigned General Fund balance is above the Council’s target of 20 - 25%.

General Fund revenues. The Bradley-Burns Sales and Use Tax revenues increased by 9% in the 2022-2023 fiscal year from 2021-2022. The Transaction and Use Tax (Measure A) increased by 9.8% in 2022-2023. Property tax revenues increased by 9.3%. Assessed property values increased by 9.07% in 2022-2023. Transient occupancy (motel) taxes showed a 1.2% decrease in 2022-2023.

Licenses and permits decreased 8.3%, the category of fines, forfeitures, and penalties decreased by 1.33%.

Intergovernmental revenues decreased significantly by $51% due to receipt of American Rescue Funds of $2,542,922 in 2021-2022. Charges for services decreased by 1.3%.

Overall, general fund revenues decreased, from $13,874,237 in Fiscal Year 2021-2022 to $11,903,769 in Fiscal Year 2022-2023 largely due to decreases in Transient Occupancy Tax, licensing and permits, and charges for services.

General Fund expenditures. General Fund expenditures totaled $13,073,878 in 2022-2023. This was an increase of 17% compared to 2021-2022 General Fund expenditures of $11,149,926. This increase is due in general to increased costs for liability and workers’ compensation costs as well as salary and benefit costs. Additionally, costs for improvements to City Parks contributed to the increase.

Governmental Funds. Governmental funds results for 2022-2023 can be found on pages 24-30.

Proprietary funds. The City’s two enterprise funds provide the same type of information found in the governmentwide financial statements but with more detail. Highlights of the annual activity for these funds have already been provided in the discussion of the business-type activities.

GENERAL FUND BUDGETARY HIGHLIGHTS
A detailed budgetary comparison schedule for the year ended June 30, 2023, is presented as a basic financial statement found on page 87.

City of Anderson
MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) (CONTINUED) June 30, 2023
12 CAPITAL ASSET AND DEBT ADMINISTRATION
Capital assets. The City’s investment in capital assets for its governmental and business-type activities as of June 30, 2023, amounted to $37.8 million (net of accumulated depreciation and amortization). This investment in capital assets includes land, park improvements, buildings and improvements, vehicles and equipment, streets, bikeways, water, sewer, storm drain systems, and construction in progress.

Additional information on the City’s capital assets may be found in Note 5 to the basic financial statements.

Long-term debt. At June 30, 2023, the City had $ 3.52 million in governmental activity debt outstanding. In addition, the City had $0.16 million in business-type activity debt outstanding. Net long-term debt increased by $1 million during Fiscal Year 2022-2023 due to the CalPERS Side Fund debt being paid off.

Additional information about the nature and type of long-term debt can be found in Note 6 to the basic financial statements and Note 12 for former RDA Bonds transferred to the Successor Agency.

ECONOMIC FACTORS AND NEXT YEAR’S BUDGET AND RATES
Annually, each May, the State Department of Finance releases their January 1 population estimates for all California cities and counties. The State Department of Finance estimated that Anderson’s population was 11,164 as of January 1, 2023, a 0.1 percent increase from the prior year.

Supply chain constraints and inflation continue to be a concern that we will be monitoring closely in next the fiscal year. The building of Single-Family homes has slowed significantly in the City generally due to rising interest rates.

However, the City is still experiencing stable revenues in Property Tax, Bradley-Burns Sales and Use Tax.

The City’s Water Division implemented a 5% increase in water rates in 2023, although the City intends to do a comprehensive water rate study in 2023-2024 to address capital improvements in the Water Fund.

REQUESTS FOR INFORMATION
This financial report is designed to provide a general overview of the City’s financial condition for all those with an interest in the City’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Finance Director/Treasurer, City of Anderson, 1887 Howard Street, Anderson, California 96007.

BASIC FINANCIAL STATEMENTS
13 City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
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14 GOVERNMENT-WIDE

FINANCIAL STATEMENTS
15 Governmental Business-Type
Activities Activities Total
ASSETS
Current assets:

Cash and investments 8,253,904 $ 2,280,351 $ 10,534,255 $ Taxes receivables 1,668,258 - 1,668,258
Accounts receivable 788,029 157,522 945,551
Interest receivable 2,565,202 - 2,565,202
Due from other governments 1,033,487 44,151 1,077,638
Internal balances (623,072) 623,072 -
Lease receivable - due in one year 15,767 - 15,767
Inventories and prepaid items 339,077 51,174 390,251
Total current assets 3,156,270 14,040,652 17,196,922
Noncurrent assets:

Restricted assets:

Cash and investments with trustee 73 - 73
Loans receivable 7,790,865 11,955 7,802,820
Lease receivable - due in more than one year 240,977 - 240,977 Capital assets:

Capital assets, not being depreciated 4,814,265 3,858 4,818,123 Capital assets, being depreciated, net 21,846,801 10,355,453 32,202,254 Intangible assets, being amortized, net 748,973 - 748,973 Total capital assets 27,410,039 10,359,311 37,769,350
Total noncurrent assets 10,371,266 35,441,954 45,813,220 Total assets 13,527,536 49,482,606 63,010,142

DEFERRED OUTFLOWS OF RESOURCES
Pension related 6,293,828 552,860 6,846,688
Total deferred outflows of resources 552,860 6,293,828 6,846,688 Primary Government
City of Anderson
Statement of Net Position
June 30, 2023
See accompanying Notes to the Basic Financial Statements. 16 Governmental Business-Type
Activities Activities Total

LIABILITIES
Current liabilities:

Accounts payable 380,432 147,721 528,153
Accrued payroll and benefits 315,138 21,305 336,443
Accrued interest 29,335 22,617 51,952
Customer/employee deposits 109,703 76,995 186,698
Unearned revenue 44,167 781,722 825,889
Compensated absences - due within one year 129,263 18,990 148,253 Long-term debt, due within one year 485,144 54,500 539,644 Total current liabilities 1,123,850 1,493,182 2,617,032 Noncurrent liabilities:

Compensated absences, due in more than one year 376,225 56,970 433,195 Long-term debt, due in more than one year 2,159,138 1,517,000 3,676,138 Net pension liability 14,390,270 1,359,320 15,749,590
Total noncurrent liabilities 2,933,290 16,925,633 19,858,923 Total liabilities 4,057,140 18,418,815 22,475,955

DEFERRED INFLOWS OF RESOURCES
Lease related - 248,173 248,173
Pension related 1,471,180 167,859 1,639,039
Total deferred inflows of resources 167,859 1,719,353 1,887,212

NET POSITION
Net investment in capital assets 24,765,757 8,787,811 33,553,568 Restricted for:

Capital improvements 5,793,768 - 5,793,768
Debt service - - -
Transportation 1,514,677 - 1,514,677
Grants - 10,898,138 10,898,138
Other - 165,428 165,428
Total restricted 18,372,011 - 18,372,011
Unrestricted (deficit) (7,499,502) 1,067,586 (6,431,916) Total net position $ 9,855,397 35,638,266 $ 45,493,663 $ Primary Government
City of Anderson
Statement of Net Position (Continued)
June 30, 2023
See accompanying Notes to the Basic Financial Statements. 17 Operating Capital Total
Charges for Grants and Grants and Program
Functions/Programs Expenses Services Contributions Contributions Revenues Governmental activities:

General government 1,241,404 $ 295,472 $ - $ - $ 295,472 $ Public safety 8,372,341 246,922 187,436 - 434,358
Public works 1,963,880 186,026 1,635,995 - 1,822,021
Planning 448,972 377,775 - - 377,775
Community development 1,393,766 5,777 1,368,522 - 1,374,299 Recreation and cultural 1,687,109 64,589 - - 64,589
Interest and fiscal charges 63,459 - - - -
Total governmental activities 1,176,561 15,170,931 3,191,953 - 4,368,514 Business-type Activities:

Water 2,153,066 1,519,638 - - 1,519,638
Sewer 2,325,352 1,787,397 - 112,830 1,900,227
Total business-type activities 3,307,035 4,478,418 - 112,830 3,419,865 Total primary government $ 4,483,596 19,649,349 $ 3,191,953 $ 112,830 $ 7,788,379 $ City of Anderson
Statement of Activities
For the Year Ended June 30, 2023
Program Revenues
See accompanying Notes to the Basic Financial Statements. 18 Governmental Business-Type
Functions/Programs Activities Activities Total
Governmental activities:

General government (945,932) $ - $ (945,932) $
Public safety - (7,937,983) (7,937,983)
Public works - (141,859) (141,859)
Planning - (71,197) (71,197)
Community development (19,467) - (19,467)
Recreation and cultural (1,622,520) - (1,622,520)
Interest and fiscal charges (63,459) - (63,459)
Total governmental activities - (10,802,417) (10,802,417) Business-type Activities:

Water (633,428) - (633,428)
Sewer (425,125) - (425,125)
Total business-type activities (1,058,553) - (1,058,553) Total primary government (1,058,553) (10,802,417) (11,860,970) General revenues and transfers:

General revenues:

Taxes:

Sales taxes - 6,667,218 6,667,218
Property taxes 2,648,530 - 2,648,530
Motel taxes - 665,909 665,909
Franchise taxes 392,561 - 392,561
Other taxes - 69,678 69,678
Total taxes 10,443,896 - 10,443,896
Investment earnings 59,496 26,982 86,478
Total general revenues 26,982 10,503,392 10,530,374
Transfers (48,953) 48,953 -
Changes in net position (1,080,524) (250,072) (1,330,596) Net position - beginning of year, as restated (Note 11) 10,935,921 35,888,338 46,824,259 Net position - end of year $ 9,855,397 35,638,266 $ 45,493,663 $ Net (Expense) Revenue and
Changes in Net Position
City of Anderson
Statement of Activities (Continued)
For the Year Ended June 30, 2023
See accompanying Notes to the Basic Financial Statements. 19 City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
(This page is intentionally left blank)
20 FUND FINANCIAL STATEMENTS
Governmental Fund Financial Statements
Proprietary Fund Financial Statements
Fiduciary Fund Financial Statements
21 City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
(This page is intentionally left blank)
22 Low and Moderate Income Housing Special Revenue Fund - To account for all activities resulting from the elimination of the Redevelopment Agency's low and moderate housing function. Primarily, this Fund utilizes program income from loan payments to provide for the development and assistance for low income households.

GOVERNMENTAL FUND

FINANCIAL STATEMENTS
General Fund - To account for and report all financial resources of the general government, except those required to be accounted for in in another fund.

ADAP and Home Special Revenue Fund - To account for the operating and financing of funds provided by Federal Housing and Urban Development for the rehabilitation and financing of homes through ADAP and Home funding.

Gas Tax Special Revenue Fund - To account for State funds received to use in providing construction and maintenance of the Street system of the City.

CDBG Special Revenue Fund - To account for funds provided by Federal Housing and Urban Development for the rehabilitation of homes and government structures through CDBG funding in addition to accounting for program income from closed grants/loans. 23 Low and
General Gas Tax ADAP and CDBG Mod Income
Fund Fund Home Fund Fund Housing Fund
ASSETS
Cash and investments 2,040,636 $ 814,092 $ 1,103,600 $ 948,972 $ 603 $ Taxes receivable 1,666,253 - - - -
Accounts receivable 643,494 - - - -
Lease receivable 256,744 - - - -
Interest receivable - - 1,542,587 701,077 320,996
Loans receivable - - 4,595,600 1,676,785 1,452,510
Due from other governments 458,113 341,655 - 224,793 -
Due from other funds 2,842,201 376,318 313,369 12,464 - Inventories and prepaid items 285,815 - - - -
Advances to other funds - - - - -
Restricted cash - - - - -
Total assets 1,532,065 8,193,256 7,555,156 3,564,091 1,774,109

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES AND FUND BALANCES
Liabilities:

Accounts payable and accrued liabilities 282,378 17,388 - 1,045 - Accrued payroll and benefits 281,899 - - 568 227
Accrued interest - - - - -
Customer/employee deposit 121,103 - - - -
Unearned revenue 11,400 - 17,115 - -
Due to other funds 1,964,253 - 12,464 365,031 1,031,128 Advances from other funds - - - - 815,449
Total liabilities 17,388 2,661,033 29,579 366,644 1,846,804 Deferred inflows of resources:

Leases 248,173 - - - -
Unavailable revenues 553,661 - - - -
Total deferred inflows of resources - 801,834 - - -
Fund balances (Deficits):

Nonspendable 285,815 - - - -
Restricted - 1,514,677 7,525,577 3,197,447 -
Assigned 275,688 - - - -
Unassigned (deficit) 4,168,886 - - - (72,695)
Total fund balances 1,514,677 4,730,389 7,525,577 3,197,447 (72,695) Total liabilities, deferred inflows of
resources, and fund balances $ 1,532,065 8,193,256 $ 7,555,156 $ 3,564,091 $ 1,774,109 $ Major Funds
City of Anderson
Balance Sheet
Governmental Funds
June 30, 2023
See accompanying Notes to the Basic Financial Statements. 24 Nonmajor Total
Governmental Governmental
Funds Funds
ASSETS
Cash and investments $ 8,195,591 3,287,688 $
Taxes receivable 1,668,258 2,005
Accounts receivable 797,972 154,478
Lease receivable 256,744 -
Interest receivable 2,565,202 542
Loans receivable 7,790,865 65,970
Due from other governments 1,033,487 8,926
Due from other funds 6,239,311 2,694,959
Inventories and prepaid items 285,815 -
Advances to other funds 120,485 120,485
Restricted cash 73 73
Total assets 28,953,803 6,335,126

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES AND FUND BALANCES
Liabilities:

Accounts payable and accrued liabilities 22,383 323,194 Accrued payroll and benefits 282,694 -
Accrued interest - -
Customer/employee deposit 121,103 -
Unearned revenue 44,167 15,652
Due to other funds 3,958,803 585,927
Advances from other funds 815,449 -
Total liabilities 5,545,410 623,962
Deferred inflows of resources:

Leases 248,173 -
Unavailable revenues 708,139 154,478
Total deferred inflows of resources 956,312 154,478
Fund balances (Deficits):

Nonspendable 406,300 120,485
Restricted 18,251,526 6,013,825
Assigned 275,688 -
Unassigned (deficit) 3,518,567 (577,624)
Total fund balances 22,452,081 5,556,686
Total liabilities, deferred inflows of
resources, and fund balances $ 28,953,803 6,335,126 $
City of Anderson
Balance Sheet
Governmental Funds (Continued)
June 30, 2023
See accompanying Notes to the Basic Financial Statements. 25 City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
(This page is intentionally left blank)
26 Total Fund Balances - Total Governmental Funds $ 22,452,081 Amounts reported for governmental activities in the statement of net position are different because:

Capital assets, not being depreciated 4,814,265 $
Capital assets, net of accumulated depreciation 21,846,801 Intangible assets, net of accumulated amortization 748,973 Less: Amount reported in the Internal Service Fund (2,232,411) 25,177,628 (17,797)
(1,445,945)
(115,757)
(109,063)
(315,626)
5,658,670
(12,828,602)
(1,278,334)
708,139
(2,247,128)
Net position of governmental activities $ 35,638,266
Pension related deferred inflows of resources, net of $(192,846) reported in the Internal Service Fund Internal Service Fund is used by management to charge the costs of data processing, customer service, maintenance, insurance, and fleet management services to individual funds. The assets and liabilities of the internal service fund are included in the governmental activities in the Government-Wide Statement of Net Position.

Long-term debt, due in more than one year, net of $(713,193) reported in the Internal Service Fund Compensated absences, due within one year, net of $(20,200) reported in the Internal Service Fund Compensated absences, due in more than one year , net of $(60,599) reported in the Internal Service Fund Net pension liability and the related deferred outflows of resources and deferred inflows of resources are not due and payable in the current period or not available for current expenditures and are not reported in the governmental fund financial statements:

Pension related deferred outflows of resources, net of $635,158 reported in the Internal Service Fund Aggregate net pension liabilities, net of $(1,561,668) reported in the Internal Service Fund Revenues earned but not available to pay for current expenditures for governmental funds are unavailable.

Long-term debt, due within one year, net of $(369,387) reported in the Internal Service Fund City of Anderson
Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position
June 30, 2023
Capital assets used in governmental activities are not financial resources and are not reported in the funds:

Amount reported in government-wide statement of position:

Interest is recognized when due, and therefore, interest payable is not reported in the governmental funds.

Long-term liabilities were not due and payable in the current period. Therefore, they were not reported in the Governmental Funds' Balance Sheet.

See accompanying Notes to the Basic Financial Statements. 27 Low and
General Gas Tax ADAP and CDBG Mod Income
Fund Fund Home Fund Fund Housing Fund
REVENUES:

Sales taxes 6,667,218 $ - $ - $ - $ - $
Property taxes 2,648,530 - - - -
Motel taxes 665,909 - - - -
Franchise taxes 392,561 - - - -
Licenses and permits 436,785 - - - -
Fines, forfeitures, and penalties 31,580 - - - -
Use of money and property 59,496 702,676 185,004 34,742 27,975 Intergovernmental revenue 171,496 545,807 - 234,388 -
Charges for current services 446,293 - - - -
Other revenues 383,901 305,585 - - -
Total revenues 1,554,068 11,903,769 185,004 269,130 27,975 EXPENDITURES:

Current:

General government 1,093,546 - - - -
Public safety 8,015,052 - - - -
Public works 47,581 1,170,567 - - -
Planning 437,659 - - - -
Community development 697,169 - 12,275 76,617 23,561
Recreation and cultural 1,471,007 - - - -
Capital outlay 1,293,508 775,164 - 40,294 -
Debt service:

Principal 16,508 - - - -
Interest and fiscal charges 1,848 - - - -
Total expenditures 1,945,731 13,073,878 12,275 116,911 23,561

EXCESS OF REVENUES OVER
(UNDER) EXPENDITURES (391,663) (1,170,109) 172,729 152,219 4,414 OTHER FINANCING SOURCES (USES):

Transfers in 4,296 - - - -
Transfers out (53,592) (15,000) - - -
Total other financing sources (uses) (15,000) (49,296) - - - NET CHANGES IN FUND BALANCES (406,663) (1,219,405) 172,729 152,219 4,414 FUND BALANCES (DEFICITS):

Beginning of year, as restated (Note 11) 5,949,794 1,921,340 7,352,848 3,045,228 (77,109) End of year 4,730,389 $ 1,514,677 $ 7,525,577 $ 3,197,447 $ (72,695) $ Major Funds
City of Anderson
Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds
For the Year Ended June 30, 2023
See accompanying Notes to the Basic Financial Statements. 28 Nonmajor Total
Governmental Governmental
Funds Funds
REVENUES:

Taxes $ 6,667,218 - $
Property taxes 2,648,530 -
Motel taxes 665,909 -
Franchise taxes 392,561 -
Licenses and permits 981,406 544,621
Fines, forfeitures, and penalties 130,262 98,682
Use of money and property 1,067,142 57,249
Intergovernmental revenue 1,186,571 234,880
Charges for current services 446,293 -
Other revenues 743,792 54,306
Total revenues 14,929,684 989,738
EXPENDITURES:

Current:

General government 1,093,546 -
Public safety 8,230,336 215,284
Public works 1,423,762 205,614
Planning 437,659 -
Community development 809,622 -
Recreation and cultural 1,494,898 23,891
Capital outlay 2,117,561 8,595
Debt service:

Principal 109,206 92,698
Interest and fiscal charges 64,641 62,793
Total expenditures 15,781,231 608,875

EXCESS OF REVENUES OVER
(UNDER) EXPENDITURES (851,547) 380,863
OTHER FINANCING SOURCES (USES):

Transfers in 121,841 117,545
Transfers out (72,888) (4,296)
Total other financing sources (uses) 48,953 113,249
NET CHANGES IN FUND BALANCES (802,594) 494,112
FUND BALANCES (DEFICITS):

Beginning of year, as restated (Note 11) 5,062,574 23,254,675 End of year $ 22,452,081 5,556,686 $
City of Anderson
Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Governmental Funds
For the Year Ended June 30, 2023
See accompanying Notes to the Basic Financial Statements. 29 Net change in fund balances - total governmental funds: $ (802,594) Amounts reported for governmental activities in the Statement of Activities are different because:
2,087,216
(1,082,676)
1,182
(51,448)
7,595
Principal repayments of long-term debt 109,206
(460,775)
(57,778)
Change in net position of governmental activities $ (250,072) Unavailable revenue is not recognized as revenue in the governmental funds since the revenue is not available to fund expenditures of the current year.

Depreciation and amortization expenses on capital and lease assets were reported in the Government-Wide Statement of Activities, but they did not require the use of current financial resources. Therefore, depreciation and amortization expenses were not reported as an expenditure in the governmental funds.

The fund financial statements record interest expenditures on the current financial resources measurement focus whereas the Government-Wide financial statements recognize interest expense on the accrual basis.

The reconciling amount was the change in accrued interest from the prior year.

Long-term compensated absences expense was reported in the Government-Wide Statement of Activities, but it did not require the use of current financial resources. Therefore, the change in long-term compensated absences was not reported as an expenditure in the governmental funds.

Pension expenses were reported in the Government-Wide Statement of Activities, but it did not require the use of current financial resources. Therefore, the increase in net pension liabilities were not reported as an expenditure in the governmental funds.

Repayment of debt principal was an expenditure in the governmental funds, but the repayment reduced longterm liabilities in the Government-Wide Statement of Net Position.

Internal Service Fund was used by management to account for the costs of data processing, customer service, maintenance, insurance, and fleet management services to individual funds. The net revenue of the internal service fund was reported with governmental activities.

Depreciation and amortization expenses, net of $616,122 reported in the internal service fund Capital outlay expenditures, net of functional expenses of $30,345 City of Anderson
Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Government-Wide Statement of Activities and Changes in Net Position For the Year Ended June 30, 2023
Governmental Funds report capital outlays as expenditures. However, in the Statement of Activities, the portion of the cost attributed to capital assets is capitalized and allocated over their estimated useful lives and reported as depreciation expense. The remaining amounts are expensed and allocated to the programs they support.

See accompanying Notes to the Basic Financial Statements. 30 Internal Service Fund - To account for the costs of data processing, customer service, maintenance, insurance, and fleet management services to individual funds.

PROPRIETARY FUND

FINANCIAL STATEMENTS
Water Enterprise Fund - To account for accounts for the operation and maintenance of the City's water utility.

Sewer Enterprise Fund - To account for accounts for the operation and maintenance of the City's waste water utility. 31 Governmental
Activities
Water Sewer Internal
Enterprise Fund Enterprise Fund Total Service Fund
ASSETS
Current assets:

Cash and investments 34,825 $ 2,245,526 $ 2,280,351 $ 58,313 $ Accounts receivable 157,309 213 157,522 1,457
Due from other governments 2,516 41,635 44,151 -
Due from other funds - 15,080 15,080 -
Inventories and prepaid items 45,963 5,211 51,174 53,262 Total current assets 2,307,665 240,613 2,548,278 113,032 Noncurrent assets:

Loans receivable - 11,955 11,955 -
Advances to other funds - 694,964 694,964 -
Capital assets, not being depreciated 3,858 - 3,858 20,000 Capital assets, being depreciated, net 4,332,337 6,023,116 10,355,453 1,542,559 Intangible assets, being amortized, net - - - 669,852
Total capital assets 4,336,195 6,023,116 10,359,311 2,232,411 Total noncurrent assets 6,730,035 4,336,195 11,066,230 2,232,411 Total assets 9,037,700 4,576,808 13,614,508 2,345,443

DEFERRED OUTFLOWS OF RESOURCES
Pension related 157,904 394,956 552,860 635,158
Total deferred outflows of resources 394,956 157,904 552,860 635,158 (Continued)
City of Anderson
Statement of Net Position
Proprietary Funds
June 30, 2023
Business-Type Activities
See accompanying Notes to the Basic Financial Statements. 32 Governmental
Activities
Water Sewer Internal
Enterprise Fund Enterprise Fund Total Service Fund

LIABILITIES
Current liabilities:

Accounts payable 73,033 $ 74,688 $ 147,721 $ 57,238 $
Accrued payroll and benefits 6,080 15,225 21,305 32,444 Accrued interest - 22,617 22,617 11,538
Customer/employee deposits 76,995 - 76,995 -
Due to other funds 86,972 - 86,972 2,208,616
Unearned revenue 1,554 780,168 781,722 -
Compensated absences, due within one year 8,248 10,742 18,990 20,200 Bonds, loans, and lease payable, due within one year - 54,500 54,500 369,387 Total current liabilities 957,940 252,882 1,210,822 2,699,423 Noncurrent liabilities:

Compensated absences, due in more than one year 24,745 32,225 56,970 60,599 Bonds, loans, and lease payable, due in more than one year - 1,517,000 1,517,000 713,193 Net pension liability 388,239 971,081 1,359,320 1,561,668 Total noncurrent liabilities 2,520,306 412,984 2,933,290 2,335,460 Total liabilities 3,478,246 665,866 4,144,112 5,034,883

DEFERRED INFLOWS OF RESOURCES
Pension related 47,943 119,916 167,859 192,846
Total deferred inflows of resources 119,916 47,943 167,859 192,846

NET POSITION
Net investment in capital assets 4,336,195 4,451,616 8,787,811 1,149,831 Unrestricted (deficit) (315,292) 1,382,878 1,067,586 (3,396,959) Total net position $ 5,834,494 4,020,903 $ 9,855,397 $ (2,247,128) $ (Concluded)
June 30, 2023
Business-Type Activities
City of Anderson
Statement of Net Position (Continued)
Proprietary Funds
See accompanying Notes to the Basic Financial Statements. 33 City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
(This page is intentionally left blank)
34 Governmental
Activities
Water Sewer Internal
Enterprise Fund Enterprise Fund Total Service Fund
OPERATING REVENUES:

Charges for services:

Waste water and water charges $ 1,787,397 1,458,346 $ 3,245,743 $ - $ Internal service fund charges - - - 3,309,640
Permits and fees 3,200 - 3,200 -
Rental revenue 10,350 - 10,350 -
Other - 47,742 47,742 509,831
Total operating revenues 1,787,397 1,519,638 3,307,035 3,819,471 OPERATING EXPENSES:

Cost of sales and service 1,285,602 1,263,712 2,549,314 3,696,540 Administrative services 684,506 628,995 1,313,501 -
Depreciation and amortization 238,469 302,477 540,946 616,122 Total operating expenses 2,250,695 2,153,066 4,403,761 4,312,662 OPERATING INCOME (LOSS) (463,298) (633,428) (1,096,726) (493,191) NONOPERATING REVENUES (EXPENSES):

Intergovernmental revenue - 112,830 112,830 -
Gain on disposal of assets - - - 67,435
Investment income 3,973 23,009 26,982 -
Interest expense - (74,657) (74,657) (35,019)
Total nonoperating revenues (expenses) 61,182 3,973 65,155 32,416

INCOME (LOSS) BEFORE
CONTRIBUTIONS AND TRANSFERS (402,116) (629,455) (1,031,571) (460,775) CONTRIBUTIONS AND TRANSFERS:

Transfers in 53,592 - 53,592 -
Transfers out (102,545) - (102,545) -
Total contributions and transfers (48,953) - (48,953) - CHANGES IN NET POSITION (451,069) (629,455) (1,080,524) (460,775) NET POSITION (DEFICIT):

Beginning of year, as restated (Note 11) 4,650,358 6,285,563 10,935,921 (1,786,353) End of year 4,020,903 $ 5,834,494 $ 9,855,397 $ (2,247,128) $ City of Anderson
Statement of Revenues, Expenses, and Changes in Net Position Proprietary Funds
For the Year Ended June 30, 2023
Business-Type Activities
See accompanying Notes to the Basic Financial Statements. 35 Governmental
Activities
Water Sewer Internal
Enterprise Fund Enterprise Fund Total Service Fund
CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from customers and users 1,562,045 $ 1,774,182 $ 3,336,227 $ 3,819,580 $ Cash paid to employees (including employee benefits) (396,911) (941,296) (1,338,207) (1,755,315) Cash paid to suppliers (1,625,696) (1,205,666) (2,831,362) (1,955,353) Net cash provided by (used in) operating activities (372,780) (460,562) (833,342) 108,912

CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES:

Cash received from other funds - 112,830 112,830 851,798 Payments made to other funds 401,447 401,447 - (178,797) Operating transfers in - 53,592 53,592 -
Operating transfers out - (102,545) (102,545) -
Net cash provided by (used in)
noncapital financing activities 63,877 401,447 465,324 673,001

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Proceeds from capital related - 112,830 - -
Payments for the purchase of property (37,773) (53,592) (91,365) (806,549) Proceeds from disposal of property - - - 67,435
Proceeds from issuance of debt - - - 360,232
Principal payments on long term debt - (52,000) (52,000) (479,559) Interest paid - (75,405) (75,405) (29,127)
Net cash used in capital
and related financing activities (180,997) (37,773) (218,770) (887,568) CASH FLOWS FROM INVESTING ACTIVITIES:

Interest received 23,009 3,973 26,982 -
Net cash provided by investing activities 23,009 3,973 26,982 - Net change in cash and cash equivalents (466,891) (92,915) (559,806) (105,655) CASH AND CASH EQUIVALENTS:

Beginning of year 127,740 2,712,417 2,840,157 163,968
End of year 34,825 $ 2,245,526 $ 2,280,351 $ 58,313 $
(Continued)
City of Anderson
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2023
Business-Type Activities
See accompanying Notes to the Basic Financial Statements. 36 Governmental
Activities
Water Sewer Internal
Enterprise Fund Enterprise Fund Total Service Fund

RECONCILIATION OF OPERATING (LOSS)

TO NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES:

Operating (loss) (633,428) $ (463,298) $ (1,096,726) $ (493,191) $ Adjustments to reconcile operating income (loss) to net cash provided by (used in) operating activities:

Depreciation and amortization expenses 238,469 302,477 540,946 616,122 (Increase) decrease in:

Accounts receivable 43,747 4,714 48,461 109
Due from other government (1,609) (12,840) (14,449) -
Inventory and prepaid items - - - 1,069
Deferred outflows from pensions (3,738) (2,371) (6,109) (63,309) Increase (decrease) in:

Accounts payable (92,384) (141,175) (233,559) (54,227)
Accrued payroll and benefits 1,238 4,535 5,773 13,957
Customer/employee deposits (1,285) - (1,285) -
Compensated absences payable 6,464 9,898 16,362 24,464
Unearned revenue 1,554 (5,089) (3,535) -
Net pension liability 153,450 373,187 526,637 690,764
Deferred inflows of resources - pensions (173,040) (442,818) (615,858) (626,846) Total adjustment 172,866 90,518 263,384 602,103
Net cash provided by (used in) operating activities $ (372,780) (460,562) $ (833,342) $ 108,912 $ (Concluded)
Business-Type Activities
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2023
City of Anderson
See accompanying Notes to the Basic Financial Statements. 37 City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
(This page is intentionally left blank)
38 FIDUCIARY FUND

FINANCIAL STATEMENTS
Custodial Fund - To account for assets held by the City in a purely custodial capacity for individuals, private organizations, and/or other governments. These funds include the Shasta Interagency Narcotics Task Force (SINTF) Fund and the County Seizure Fund.

Private-Purpose Trust Fund - To report trust arrangements under which principal and income benefit other governments. This fund reports the assets, liabilities, and activities of the City of Anderson Redevelopment Agency Successor Agency (Successor Agency). 39 City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
(This page is intentionally left blank)
40 Private
Purpose Trust Custodial
Fund Fund
ASSETS:

Cash and investments $ 2,191,095 221,074 $
Land held for resale - 48,774
Restricted cash and investments with trustee - 489,387
Total assets 2,191,095 759,235
LIABILITIES:

Accounts payable and accrued liabilities 2,068,472 2,522 Accrued interest - 91,515
Due to other government - 216,214
Long-term liabilities:

Due in one year - 270,000
Due in more than one year - 5,269,087
Total liabilities 2,068,472 5,849,338
NET POSITION:

Restricted for Successor Agency, Individual, organization and other government 122,623 (5,090,103) Total net position (deficit) $ 122,623 (5,090,103) $
City of Anderson
Statement of Fiduciary Net Position
Fiduciary Fund
June 30, 2023
See accompanying Notes to the Basic Financial Statements 41 Private
Purpose Trust Custodial
Fund Fund
ADDITIONS:

Redevelopment property taxes trust fund 562,596 $ - $
Total additions - 562,596
DEDUCTIONS:

Community development - 245,142
Administrative expenses 122,427 -
Operating supplies 67,917 -
Interest expense - 108,083
Contributions 2,229,965 -
Total deductions 2,420,309 353,225
Changes in net position (2,420,309) 209,371
NET POSITION (DEFICIT):

Beginning of year 2,542,932 (5,299,474)
End of year $ 122,623 (5,090,103) $
Statement of Changes in Fiduciary Net Position
Fiduciary Funds
For the Year Ended June 30, 2023
City of Anderson
See accompanying Notes to the Basic Financial Statements. 42 43

NOTES TO THE BASIC

FINANCIAL STATEMENTS
44 City of Anderson
Annual Comprehensive Financial Report
For the Year Ended June 30, 2023
(This page is intentionally left blank)
City of Anderson
Index to the Notes to the Basic Financial Statements
For the Year Ended June 30, 2023
45 Note 1 – Summary of Significant Accounting Policies ...................................................................................... 47 A. Financial Reporting Entity ................................................................................................................... 47 B. Basis of Accounting and Measurement Focus ..................................................................................... 48 C. Budgets ................................................................................................................................................ 50 D. Cash, Cash Equivalents, and Investments ............................................................................................ 51 E. Fair Value Measurement ...................................................................................................................... 51 F. Receivables .......................................................................................................................................... 51 G. Interfund Transactions ......................................................................................................................... 51 H. Restricted Assets .................................................................................................................................. 52 I. Inventories and Prepaid Items .............................................................................................................. 52 J. Capital Assets ....................................................................................................................................... 52 K. Deferred Outflows and Inflows of Resources ...................................................................................... 53 L. Interest Payable .................................................................................................................................... 53 M. Unearned Revenue ............................................................................................................................... 53 N. Compensated Absences ........................................................................................................................ 53 O. Leases ................................................................................................................................................... 53 P. Pensions ............................................................................................................................................... 55 Q. Subscription Based Information Technology Arrangements Liabilities .............................................. 55 R. Long-Term Debt .................................................................................................................................. 56 S. Property Taxes ..................................................................................................................................... 56 T. Net Position and Fund Balances .......................................................................................................... 56 U. Use of Estimates................................................................................................................................... 58 V. Implementation of New GASB Pronouncements ................................................................................ 58 Note 2 – Cash and Investments ............................................................................................................................ 58 A. Deposits ................................................................................................................................................ 59 B. Investments .......................................................................................................................................... 60 C. Local Agency Investments Fund (“LAIF”) .......................................................................................... 60 D. Fair Value Measurement ...................................................................................................................... 61 E. Risk Disclosures ................................................................................................................................... 61 Note 3 – Interfund Transactions .......................................................................................................................... 62 Note 4 – Lease Receivable ..................................................................................................................................... 63 Note 5 – Capital Assets .......................................................................................................................................... 64 A. Governmental Activities ...................................................................................................................... 64 B. Business-Type Activities ..................................................................................................................... 65 Note 6 – Long-Term Liabilities ............................................................................................................................ 66 A. Governmental Activities ...................................................................................................................... 66 B. Business-Type Activities ..................................................................................................................... 70 Note 7 – Self-Insurance Programs........................................................................................................................ 71 City of Anderson
Index to the Notes to the Basic Financial Statements (Continued) For the Year Ended June 30, 2023
46 Note 8 – Defined Benefit Pension Plans ............................................................................................................... 72 A. General Information about the Pension Plan ....................................................................................... 72 B. Pension Liabilities, Pension Expenses, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pension .............................................................................. 74 Note 9 – Deferred Compensation Plan ................................................................................................................. 78 Note 10 – Net Position and Fund Balances .......................................................................................................... 79 A. Government-Wide Financial Statements ............................................................................................. 79 B. Fund Financial Statements ................................................................................................................... 79 Note 11 – Restatement of Beginning Net Position ............................................................................................... 80 Note 12 – Other Required Fund Disclosures ....................................................................................................... 81 Note 13 – Successor Agency Trust for Assets of the Former Redevelopment Agency .................................... 82 Note 14 – Commitments and Contingencies ........................................................................................................ 83 City of Anderson
Notes to the Basic Financial Statements
For the Year Ended June 30, 2023
47 Note 1 – Summary of Significant Accounting Policies
The basic financial statements of the City of Anderson, California, (the “City”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) as applied to governmental agencies. The Governmental Accounting Standards Board (“GASB”) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The following is a summary of the significant policies:

A. Financial Reporting Entity
The City was incorporated January 16, 1956, under the General Laws of the State of California. The City is governed by an elected five-member council.

Blended Component Unit
In evaluating how to define the City for financial reporting purposes, management has considered all potential component units. The primary criteria for including a potential component unit within the reporting entity are the governing body’s financial accountability and a financial benefit or burden relationship and whether it is misleading to exclude. A primary government is financially accountable and shares a financial benefit or burden relationship, if it appoints a voting majority of an organization’s governing body and it is able to impose its will on the organization, or if there is a potential for the organization to provide specific financial benefits to, or impose specific financial burdens on the primary government. A primary government may also be financially accountable if an organization is fiscally dependent on the primary government regardless of whether the organization has a separately elected governing board, a governing board appointed by a higher level of government, or a jointly appointed board, and there is a potential for the organization to provide specific financial benefits to, or impose specific financial burdens on the primary government.

Management determined that the following component unit should be blended based on the criteria above:

Although the following is legally separate from the City, it has been “blended” as though it is part of the City because the component unit’s governing body is substantially the same as the City’s and there is a financial benefit or burden relationship between the City and the component unit; management of the City has operational responsibilities for the component unit; and/or the component unit provides services entirely, or almost entirely, to the City or otherwise exclusively, or almost exclusively, benefits the City, even though it does not provide services directly to it.

Anderson Public Financing Authority - The Anderson Public Financing Authority (the “Authority”) was created primarily to facilitate the financing of public improvements, as well as other facilities and improvements which can be funded through the issuance of tax-exempt bonds. The Authority is authorized, among other things, to issue bonds pursuant to the provisions of the Marks-Roos Local Bond Pooling Act of 1985 for the purpose of financing facilities and improvements. The members of the City Council serves as the governing board of the Authority and there is a financial benefit or burden relationship between them and the Authority. The Authority does not issue separate financial statements.

The City had no discretely presented component units.

City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
48 Note 1 – Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus
The accounts of the City are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for by providing a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures or expenses, as appropriate. City resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled.

Government-Wide Financial Statements
The Government-Wide Financial Statements are presented on an “economic resources” measurement focus and the accrual basis of accounting. Accordingly, all of the City’s assets, deferred outflows of resources, liabilities, and deferred inflows of resources, including capital assets, as well as infrastructure assets, and long-term liabilities, are included in the accompanying Statement of Net Position. The Statement of Activities presents changes in net position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred. Fiduciary activities are not included in these statements.

Certain types of transactions are reported as program revenues for the City in three categories:
 Charges for services
 Operating grants and contributions
 Capital grants and contributions
Certain eliminations have been made in regards to interfund activities, payables and receivables. All internal balances in the Statement of Net Position have been eliminated except those representing balances between the governmental activities and the business-type activities, which are presented as internal balances and eliminated in the total primary government column. In the Statement of Activities, internal service fund transactions have been eliminated; however, those transactions between governmental and business-type activities have not been eliminated. The following interfund activities have been eliminated:
 Due from and to other funds
 Transfers in and out
Governmental Fund Financial Statements
All governmental funds are accounted for on a spending or “current financial resources” measurement focus and the modified accrual basis of accounting. Accordingly, only current assets and current liabilities are included on the Balance Sheet. The Statement of Revenues, Expenditures and Changes in Fund Balances present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in fund balances.

Under the modified accrual basis of accounting, revenues are recognized in the accounting period in which they become both measurable and available to finance expenditures of the current period.

Revenues are recognized as soon as they are both “measurable” and “available”. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For these purposes, the City considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. The primary revenue sources, which have been treated as susceptible to accrual by the City, are property taxes, other local taxes, franchise fees, forfeitures and penalties, motor license fees, rents and concessions, interest revenue, and state and federal grants and subventions. Expenditures are recorded in the accounting period in which the related fund liability is incurred.

City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
49 Note 1 – Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus (Continued) Governmental Fund Financial Statements (Continued)
Reconciliations of the fund financial statements to the Government-Wide Financial Statements are provided to explain the differences.

Certain indirect costs are included as part of the program expenses reported for individual functions and activities.

The City reports the following major governmental funds:
 General Fund – The General Fund is the City’s primary operating fund and accounts for all financial resources of the general government, except those required to be accounted for in another fund.  Gas Tax Fund – The Gas Tax Fund accounts for state funds received for use in providing construction and maintenance of the street system of the City.
 ADAP and Home Fund – The ADAP and Home Fund accounts for the operating and financing of funds provided by Federal Housing and Urban Development for the rehabilitation and financing of homes through ADAP and Home funding.
 CDBG Fund – The CDBG Fund accounts for funds provided by Federal Housing and Urban Development for the rehabilitation of homes and government structures through CDBG funding in addition to accounting for program income from closed grants/loans.
 Low and Mod Income Housing Fund – The Low and Moderate Income Housing Fund accounts for all activities resulting from the elimination of the Redevelopment Agency’s low and moderate housing function. Primarily, this Fund utilizes program income from loan payments to provide for the development and assistance for low‐income households.

Proprietary Fund Financial Statements
Proprietary funds are accounted for using the “economic resources” measurement focus and the accrual basis of accounting. Accordingly, all assets and liabilities (whether current or noncurrent) are included on the Statement of Net Position. The Statement of Revenues, Expenses and Changes in Net Position presents increases (revenues) and decreases (expenses) in total net position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred.

Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the proprietary funds are charges to customers for sales and services. Operating expenses for the proprietary funds include the costs of sales and services, administrative expenses and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses.

A separate column representing internal service fund is also presented in these statements. However, internal service balances and activities have been combined with the governmental activities and business-type activities in the Government-Wide Financial Statements.

City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
50 Note 1 – Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus (Continued) Proprietary Fund Financial Statements (Continued)
The City reports the following major proprietary funds:
 Water Fund - The Water Fund accounts for the operation and maintenance of the City’s water utility.  Sewer Fund - The Sewer Fund accounts for the operation and maintenance of the City’s waste water utility.

Additionally, the City reports the following fund types:
 Internal Service Fund - Internal Service Fund accounts for the costs of data processing, customer service, maintenance, insurance, and fleet management services charged to individual funds.

Fiduciary Fund Financial Statements
Fiduciary fund financial statements include a statement of fiduciary net position and a statement of changes in fiduciary net position. The City’s fiduciary fund represent private purpose trust fund and custodial funds. Both private purpose trust fund and custodial funds are accounted for on the full accrual basis of accounting where the assets associated with the activity are controlled by the City and the assets are not derived 1) solely from the government’s own-source revenues or 2) from government-mandated nonexchange transactions or voluntary nonexchange transactions.

The City reports the following fiduciary fund type:
 Private‐purpose Trust Fund - The Private Purpose Trust Fund is a fiduciary fund type used by the City to report trust arrangements under which principal and income benefit other governments. This fund reports the assets, liabilities, and activities of the City of Anderson Redevelopment Agency Successor Agency (the “Successor Agency”).
 Custodial Funds - Custodial Funds account for assets held by the City in a purely custodial capacity for individuals, private organizations, and/or other governments. These funds include the Shasta Interagency Narcotics Task Force (SINTF) Fund and the County Seizure Fund.

C. Budgets
Budgets for the General Fund and special revenue funds are adopted on a basis consistent with U.S. GAAP. Formal budgetary integration is employed as a management control device during the year for these funds. Proprietary fund budgeting parallels that of private business enterprises. Expenditures may not legally exceed budgeted appropriations at the fund level. The City Manager is authorized to make budget transfers within any fund (the legal level). All revisions must be reported to the City Council before the end of the fiscal year. All unencumbered and unexpended appropriations lapse at the end of the fiscal year. Encumbrances are reappropriated in the ensuing year’s budget.

City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
51 Note 1 – Summary of Significant Accounting Policies (Continued) D. Cash, Cash Equivalents, and Investments
The City’s cash and cash equivalents are considered to be cash on hand, demand deposits, and short-term investments with original maturity of three months or less from the date of acquisition. All cash and investments of proprietary funds are held in the City's investment pool. These cash pools have the general characteristics of a demand deposit account, therefore, all cash and investments in the proprietary funds are considered cash and cash equivalents for Statement of Cash Flows purposes.

Investments are stated at fair value.

E. Fair Value Measurement
U.S. GAAP defines fair value, establishes a framework for measuring fair value and establishes disclosure about fair value measurement. Investments, unless otherwise specified at fair value in the financial statements, are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Levels of inputs are as follows:
 Level 1 – Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date.
 Level 2 – Inputs, other than quoted prices included in Level 1, that are observable for the assets or liabilities through corroboration with market data at the measurement date.  Level 3 – Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the assets or liabilities at the measurement date.

F. Receivables
Accounts receivable consist of water and sewer billings and other miscellaneous billings. The water and sewer departments record service fees when earned with a corresponding receivable. The City also records receivables for other miscellaneous user fees and charges. Management records an allowance for doubtful accounts for all receivables which they deem uncollectible. Management determined there were no material uncollectible receivables at June 30, 2023.

Loans receivable consist of loans to individuals for housing rehabilitation and to businesses for construction and business loans. Management considers all loans receivable to be collectible.

Taxes receivable consist of various sales and use taxes, property taxes, and special assessments. Management considers all taxes receivable to be collectible.

G. Interfund Transactions
During the course of operations, numerous transactions that constitute reimbursements to a fund for expenditures/expenses initially made from one fund that are properly applicable to another fund, are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed. In addition, on a less occasional basis, the City incurs transactions that constitute quasi‐external transactions between funds. These transactions are accounted for as revenues, expenditures, or expenses in the funds involved in these transactions.

All other interfund transactions are reported as transfers.

City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
52 Note 1 – Summary of Significant Accounting Policies (Continued) G. Interfund Transactions (Continued)
Fund transfers are necessary to properly account for cash increases/decreases in the appropriate funds. Transfers include, but are not limited to, the following:
 To allocate funds for operations;
 To allocate funds for equipment replacement;
 To allocate funds for capital projects.

These transactions result in short‐term interfund receivables and payables that are classified as “due from other funds” or “due to other funds” and in long‐term interfund receivables and payables that are classified as “advances to other funds” or “advances from other funds” on the balance sheet – governmental funds and statement of net position – proprietary funds. Any residual balances outstanding between the governmental activities and business‐ type activities are reported in the government‐wide financial statements as “internal balances.” H. Restricted Assets
Certain proceeds of debt issues, as well as certain reserves set aside for their repayment, are classified as restricted assets on the statement of net position and balance sheets because their use is limited by applicable bond covenants.

I. Inventories and Prepaid Items
Proprietary fund inventories are adjusted to annual physical counts and are valued at cost, which approximates market, utilizing the weighted average method of valuation. The costs of governmental fund‐type inventories are recorded as expenditures when consumed rather than when purchased.

Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both the government-wide and fund financial statements by using purchase method.

A nonspendable fund balance has been reported in the governmental funds to show that inventories and prepaid items do not constitute “available spendable resources,” even though they are a component of current assets.

J. Capital Assets
In the Government-Wide Financial Statements, capital assets are recorded at cost where historical records are available and at an estimated original cost where no historical records exist. Donated capital assets are valued at their acquisition value.

Capital assets used in operations are depreciated over their estimated useful lives using the straight-line method.

The lives used for depreciation purposes are as follows:

Buildings Primarily 25 to 30 years
Improvements Primarily 10 to 30 years
Equipment Primarily 5 to 10 years
Vehicles Primarily 5 to 10 years
Furniture and fixtures Primarily 7 years
City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
53 Note 1 – Summary of Significant Accounting Policies (Continued) J. Capital Assets (Continued)
It is the policy of the City to capitalize all land, buildings, improvements, equipment, vehicles, furniture, and fixtures, except assets costing less than $5,000. The costs of normal maintenance and repairs that do not add to the value of the assets or materially extend asset lives are not capitalized. Costs of assets sold or retired (and related amounts of accumulated depreciation) are eliminated from the accounts in the year of sale or retirement and the resulting gain or loss is included in the operating statement of the related fund. Major outlays for capital assets and improvements are capitalized as projects are constructed.

The City’s capital assets include infrastructure acquired on or after July 1, 2002. GASB Statement No. 34 does not require retrospective reporting of infrastructure for the City.

K. Deferred Outflows and Inflows of Resources
The statement of net position and balance sheet – governmental funds reports separate sections for deferred outflows of resources and deferred inflows of resources, when applicable.

Deferred Outflows of Resources represent a consumption of net assets that applies to future periods.

Deferred Inflows of Resources represent an acquisition of net assets that applies to future periods.

L. Interest Payable
In the Government-wide Financial Statements, interest payable on long-term debt is recognized as the liability incurred for governmental activities and business-type activities.

In the Fund Financial Statements, only proprietary fund types recognize the interest payable when the liability is incurred.

M. Unearned Revenue
Unearned revenue is recognized for transactions for which revenue has not yet been earned. Typical transactions recorded as unearned revenues are prepaid charges for services and grants received but not yet earned.

N. Compensated Absences
Vested or accumulated vacation leave, sick leave, and compensatory time are accrued in the proprietary funds and in the government‐wide statements as the benefits accrue to employees. However, a liability for these amounts is reported in the governmental funds only if they have matured, for example, as a result of employee resignations or retirements. In accordance with U.S. GAAP, no liability is recorded for nonvesting accumulated rights to receive sick pay benefits.

O. Leases
Lessee
The City has a policy to recognize a lease liability and a right-to-use asset (lease asset) in the financial with a lease term greater than one year. Variable payments based on future performance or usage of the underlying assets are not included in the measurement of the lease liability.

City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
54 Note 1 – Summary of Significant Accounting Policies (Continued) O. Leases (Continued)
Lessee (Continued)
At the commencement of a lease, the lease liability is measured at the present value of payments expected to be made during the lease term. Subsequently, the lease liability is reduced by the principal portion of lease payments made.

Lease assets are recorded at the amount of the initial measurement of the lease liabilities and modified by any lease payments made to the lessor at or before the commencement of the lease term, less any lease incentives received from the lessor at or before the commencement of the lease term along with any initial direct costs that are ancillary charges necessary to place the lease assets into service. Lease assets are amortized using the straight–line method over the shorter of the lease term or the useful life of the underlying asset, unless the lease contains a purchase option that the State has determined is reasonably certain of being exercised. In this case, the lease asset is amortized over the useful life of the underlying asset.

Key estimates and judgments related to leases include how the City determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) lease payments.  The City uses the interest rate charged by the lessor as the discount rate. When the interest rate charged by the lessor is not provided, the City generally uses its estimated incremental borrowing rate as the discount rate for leases.
 The lease term includes the noncancelable period of the lease, plus any option periods that are reasonably certain to be exercised.
 Lease payments included in the measurement of the lease liability are composed of fixed payments and purchase option price that the City is reasonably certain to exercise. The City monitors changes in circumstances that would require a remeasurement of a lease and will remeasure any lease asset and liability if certain changes occur that are expected to significantly affect the amount of the lease liability.

Lease assets are reported as right-to-use along with other capital assets and lease liabilities are reported on the statement of net position.

Lessor
The City is a lessor for leases of buildings and recognizes lease receivables and deferred inflows of resources in the financial statements. Variable payments based on future performance or usage of the underlying asset are not included in the measurement of the lease receivable.

At the commencement of a lease, the lease receivable is measured at the present value of payments expected to be received during the lease term. Subsequently, the lease receivable is reduced by the principal portion of lease payments received. The deferred inflows of resources are initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date. Subsequently, the deferred inflows of resources are recognized as revenue over the life of the lease term in a systematic and rational method.

City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
55 Note 1 – Summary of Significant Accounting Policies (Continued) O. Leases (Continued)
Lessor (Continued)
Key estimates and judgments include how the City determines (1) the discount rate it uses to discount the expected lease receipts to present value, (2) lease term, and (3) lease receipts.  The City uses the incremental borrowing rate (IBR) provided by the financial institution during implementation for existing leases or the current rate at the time a new lease is executed or modified.  The lease term includes the noncancelable period of the lease plus any option periods that are likely to be exercised.
 Lease receipts included in the measurement of the lease receivable is composed of fixed payments from the lessee.

The City monitors changes in circumstances that would require a remeasurement of its lease and will remeasure the lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the amount of the lease receivable.

P. Pensions
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the plans and additions to/deductions from the plans’ fiduciary net position have been determined on the same basis as they are reported by the plans. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with benefit terms. Investments are reported at fair value.

The following timeframes are used for pension reporting:

Valuation Date June 30, 2021
Measurement Date June 30, 2022
Measurement Period July 1, 2021 to June 30, 2022
Gains and losses related to changes in total pension liability and fiduciary net position are recognized in pension expense systematically over time. The first amortized amounts are recognized in pension expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to pensions and are to be recognized in future pension expense. The amortization period differs depending on the source of the gain or loss. The difference between projected and actual earnings is amortized straight-line over 5 years. All other amounts are amortized straight-line over the average expected remaining service lives of all members that are provided with benefits (active, inactive, and retired) as of the beginning of the measurement period.

Q. Subscription Based Information Technology Arrangements Liabilities The City recognizes subscription liabilities with a subscription term greater than one year in the government-wide and proprietary fund financial statements. Variable payments based on future performance of the City, usage of the underlying IT assets, or number of user seats are not included in the measurement of the subscription liability.

At the commencement of a subscription, the City initially measures the subscription liability at the present value of subscription payments expected to be made during the subscription term. Subsequently, the lease liability is reduced by the principal portion of subscription payments made.

City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
56 Note 1 – Summary of Significant Accounting Policies (Continued) Q. Subscription Based Information Technology Arrangements Liabilities (Continued) Key estimates and judgments related to subscription liabilities include how the City determines (1) the discount rate it uses to discount the expected subscription payments to present value, (2) subscription term, and (3) subscription payments.
 The City uses the interest rate charged by the SBITA vendor as the discount rate. When the interest rate charged by the lessor is not provided, the City generally uses its estimated incremental borrowing rate as the discount rate for subscription liabilities.
 The subscription term includes the noncancellable period of the SBITA. Subscription payments included in the measurement of the subscription liability are composed of fixed payments.

The City monitors changes in circumstances that would require a remeasurement of its SBITA and will remeasure any subscription asset or liability if certain changes occur that are expected to significantly affect the amount of the subscription liability.

R. Long-Term Debt
In the Government-Wide Financial Statements and Proprietary Fund Financial Statements, long-term debt and other long-term obligations are reported as liabilities in the appropriate activities. Bond premium and discounts are deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are expensed when incurred.

The governmental fund financial statements do not present long-term liabilities. Consequently, long-term debt is shown as a reconciling item in the Reconciliation of the Governmental Funds Balance Sheet to the GovernmentWide Statement of Net Position.

S. Property Taxes
Under California law, property taxes are assessed and collected by the counties for up to 1% of assessed property value, plus other increases approved by the voters. Property taxes collected are pooled and then allocated to the cities based on complex formulas. The following are key dates pertaining to property taxes:

Lien Date January 1
Levy Date June 30
Due Dates November 1 and February 1
Collection Dates December 10 and April 10
T. Net Position and Fund Balances
In the Government-Wide Financial Statements and proprietary fund financial statements, net position is classified as follows:

Net Investment in Capital Assets – This component of net position consists of capital assets, net of accumulated depreciation and amortization, reduced by the outstanding balances of retention payable and debt that are attributable to the acquisition, construction, or improvement of those assets.

Restricted – This component of net position consists of restricted assets reduced by liabilities and deferred outflows and inflows of resources related to those assets.

City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
57 Note 1 – Summary of Significant Accounting Policies (Continued) T. Net Position and Fund Balances (Continued)
Unrestricted – This component of net position is the amount of the assets, deferred outflows of resources, liabilities, and deferred inflows of resources that are not included in the determination of net investment in capital assets or the restricted component of net position.

In the Governmental Fund Financial Statements, fund balances are classified as follows:

Nonspendable – Nonspendable fund balances are items that cannot be spent because they are not in spendable form, such as prepaid items and inventories, or items that are legally or contractually required to be maintained intact, such as principal of an endowment or revolving loan funds.

Restricted – Restricted fund balances encompass the portion of net fund resources subject to externally enforceable legal restrictions. This includes externally imposed restrictions by creditors, such as through debt covenants, grantors, contributors, laws or regulations of other governments, as well as restrictions imposed by law through constitutional provisions or enabling legislation.

Committed – Committed fund balances encompass the portion of net fund resources, the use of which is constrained by limitations that the government imposes upon itself at its highest level of decision making, normally the governing body, and that remain binding unless removed in the same manner. The City Council is considered the highest authority for the City. Adoption of a resolution by the City Council is required to commit resources or to rescind the commitment.

Assigned – Assigned fund balances encompass the portion of net fund resources reflecting the government’s intended use of resources. Assignment of resources can be done by the highest level of decision making or by a committee or official designated for that purpose. The City Council has authorized by resolution the City Manager or the City Fiscal Officer for that purpose.

Unassigned – This amount is for any portion of the fund balances that do not fall into one of the above categories. The General Fund is the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it is not appropriate to report a positive unassigned fund balance amount. However, in governmental funds other than General Fund, if expenditures incurred for specific purposes exceed the amounts that are restricted, committed or assigned to those purposes, it may be necessary to report a negative unassigned fund balance in that fund.

The City Council establishes (and modifies or rescinds) fund balance commitments by passage of an ordinance or resolution. This is typically done through adoption and amendment of the budget. A fund balance commitment is further indicated in the budget document as a designation or commitment of the fund (such as for special incentives).

Assigned fund balance is established by the City Council through adoption or amendment of the budget as intended for specific purpose (such as the purchase of fixed assets, construction, debt service, or for other purposes).

When an expenditure is incurred for purposes for which both restricted and unrestricted resources are available, the City considers restricted funds to have been spent first. When an expenditure is incurred for which committed, assigned, or unassigned fund balances are available, the City considers amounts to have been spent first out of committed funds, then assigned funds, and finally unassigned funds, as needed, unless the City Council has provided otherwise in its commitment or assignment actions.

City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
58 Note 1 – Summary of Significant Accounting Policies (Continued) U. Use of Estimates
The preparation of the basic financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

V. Implementation of New GASB Pronouncements
In May 2019, GASB issued Statement No. 91, Conduit Debt Obligations, to provide a single method of reporting conduit debt obligations by issuers and eliminate diversity in practice associated with (1) commitments extended by issuers, (2) arrangements associated with conduit debt obligations, and (3) related note disclosures. This Statement achieves those objectives by clarifying the existing definition of a conduit debt obligation; establishing that a conduit debt obligation is not a liability of the issuer; establishing standards for accounting and financial reporting of additional commitments and voluntary commitments extended by issuers and arrangements associated with conduit debt obligations; and improving required note disclosures. Implementation of this Statement did not have a significant effect to the City’s financial statements for the fiscal year ended June 30, 2023.

In March 2020, GASB issued Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangements (GASB Statement No. 94), to improve financial reporting by addressing issues related to public-private and public-public partnership arrangements (PPPs). Implementation of this Statement did not have a significant effect to the City’s financial statements for the fiscal year ended June 30, 2023.

In May 2020, GASB issued Statement No. 96, Subscription-Based Information Technology Arrangements (GASB Statement No. 96), to better meet the information needs of financial statement users by (a) establishing uniform accounting and financial reporting requirements for SBITAs; (b) improving the comparability of financial statements among governments that have entered into SBITAs; and (c) enhancing the understandability, reliability, relevance, and consistency of information about SBITAs. Under this Statement, a government is required to recognize a subscription liability and an intangible right-to-use subscription asset. The effective date of GASB Statement No. 96 is for fiscal years beginning after June 15, 2022. Implementation of this Statement resulted in restatement of beginning balance of capital assets (Note 5) and long-term debt liabilities (Note 6) at July 1, 2022.

In March 2022, GASB issued Statement No. 99, Omnibus 2022, to enhance comparability in accounting and financial reporting and to improve the consistency of authoritative literature by addressing (1) practice issues that have been identified during implementation and application of certain GASB Statements and (2) accounting and financial reporting for financial guarantees. Implementation of this Statement did not have a significant effect to the City’s financial statements for the fiscal year ended June 30, 2023.

Note 2 – Cash and Investments
Cash and investments as of June 30, 2023, are classified in the accompanying financial statements as follows:

Fiduciary
Governmental Business-Type Fund Statement
Activities Activities Net Position Total
Unrestricted assets:

Cash and investments 8,253,904 $ 2,280,351 $ 2,412,169 $ 12,946,424 $ Restricted assets:

Cash and investments with trustee 73 - 489,387 489,460
Total cash and investments $ 2,280,351 8,253,977 $ 2,901,556 $ 13,435,884 $ Statement of Net Position
City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
59 Note 2 – Cash and Investments (Continued)
Cash and investments at June 30, 2023, in more detail:

Cash:

Petty cash 850 $
Demand deposits 1,863,995
Total cash and cash equivalents 1,864,845
Investments:

Negotiable certificates of deposit 265,838
Local Agency Investment Fund 10,815,741
Total investments 11,081,579
Total cash and investments 12,946,424
Cash and investments with trustee:

Money market funds 489,460
Total $ 13,435,884
A. Deposits
The carrying amounts of the City’s demand deposits were $1,863,995 at June 30, 2023. Bank balances at that date were $1,868,401, the total amount of which was collateralized or insured with accounts held by the pledging financial institutions in the City’s name as discussed below.

The California Government Code requires California banks and savings and loan associations to secure the City’s cash deposits by pledging securities as collateral. This Code states that collateral pledged in this manner shall have the effect of perfecting a security interest in such collateral superior to those of a general creditor. Thus, collateral for cash deposits is considered to be held in the City's name.

The market value of pledged securities must equal at least 110% of the City's cash deposits. California law also allows institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the City’s total cash deposits. The City may waive collateral requirements for cash deposits, deposits, which are fully insured up to $250,000 by the Federal Deposit Insurance Corporation (“FDIC”). The City did not waive the collateral requirement for deposits insured by FDIC.

The City follows the practice of pooling cash and investments of all funds, except for funds required to be held by fiscal agents under the provisions of bond indentures. Interest income earned on pooled cash and investments is allocated on an accounting period basis to the various funds based on the period-end cash and investment balances.

Interest income from cash and investments with fiscal agents is credited directly to the related fund.

City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
60 Note 2 – Cash and Investments (Continued)
B. Investments
Under the provisions of the City’s investment policy, and in accordance with California Government Code, the following investments are authorized:

Maximum Maximum
Maximum Percentage Investment in
Authorized Investment Type Maturity of Portfolio One Issuer United states treasury obligations 5 years No Limit None Bankers' acceptances 180 days 15% None
Negotiable certificates of deposit 5 years 30% None
Commercial paper 270 days 15% 5%
Medium-term notes 5 years 15% None
Money market mutual funds N/A 20% None
Local Agency Investment Fund ("LAIF") N/A No Limit None N/A - Not Applicable
C. Local Agency Investment Fund (“LAIF”)
The City is a participant in LAIF which is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. The City’s investments with LAIF at June 30, 2023, included a portion of the pool funds invested in Structured Notes and Asset-Backed Securities:

Structured Notes: debt securities (other than asset-backed securities) whose cash flow characteristics (coupon rate, redemption amount, or stated maturity) depend upon one or more indices and/or that have embedded forwards or options.

Asset-Backed Securities: generally, mortgage-backed securities that entitle their purchasers to receive a share of the cash flows from a pool of assets such as principal and interest repayments from a pool of mortgages (for example, Collateralized Mortgage Obligations) or credit card receivables.

As of June 30, 2023, the City had $10,815,741 invested in LAIF, which had invested 2.78% of the pool investment funds in Structured Notes and Asset-Backed Securities. The fair value of the City’s portion in the pool is the same as the value of the pool shares and reported at amortized cost.

City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
61 Note 2 – Cash and Investments (Continued)
D. Fair Value Measurement
At June 30, 2023, investments are reported at fair value. The following table presents the fair value measurements of investments on a recurring basis and the levels with GASB 72 fair value hierarchy in which the fair value measurements fall at June 30, 2023:

Significant
Other Observable
Inputs
Investment Type (Level 2) Uncategorized Total
Negotiable certificates of deposit (1) $ - 265,838 $ 265,838 $ Local Agency Investment Fund - 10,815,741 10,815,741
Cash and investments with trustee:

Money market mutual fund - 489,460 489,460
Total $ 11,305,201 265,838 $ 11,571,039 $
(1) Pricing based on Institutional Bond Quotes - evaluations based on various market and industry inputs.

Measurement Input
E. Risk Disclosures
Interest Rate Risk - While the City’s investment policy does not address interest rate risk, the City manages its exposure to interest rate risks through reliance on the managers of LAIF.

Custodial Credit Risk - For deposits, custodial credit risk is the risk that, in the event of the failure of a depository financial institution, the City will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. For an investment, custodial credit risk is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer), the City will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. At June 30, 2023, none of the City’s deposits or investments were exposed to custodial credit risk.

Credit Risk - Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. To be eligible to receive City money, a bank, savings association, federal association, or federally insured industrial loan company shall have received an overall rating of not less than "satisfactory" in its most recent evaluation by the appropriate federal financial supervisory agency of its record of meeting the credit needs of California's communities, including low-and-moderate income neighborhoods. At June 30, 2023, the City’s credit risks, expressed on a percentage basis, were as follows:

Moody's S&P's % of Investments
Credit Credit with Interest
Investment Type Rating Rating Rate Risk
Negotiable certificates of deposit Not Rated Not Rated 2.40% Local Agency Investment Fund Not Rated Not Rated 97.60% Total 100.00%
Credit Quality Distribution for Securities
with Credit Exposure as a Percentage of Total Investments City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
62 Note 3 – Interfund Transactions
Advances From/To Other Funds - At June 30, 2023, the City had the following advances:

Governmental Fund
Advances from Other Funds
Low and Mod Income
Housing Special Revenue
Fund
Governmental Funds:

Nonmajor Governmental Funds 120,485 $
Proprietary Fund:

Sewer Enterprise Fund 694,964
Total $ 815,449
Advances to Other Funds
Transfers – For the year ended June 30, 2023, the City had the following transfers:

Transfers Out
General Fund
Nonmajor
Governmental
Funds
Sewer
Enterprise
Fund Total
Governmental Funds:

General Fund - $ - $ 53,592 $ 53,592 $
Gas Tax Special Revenue Fund - 15,000 - 15,000
Nonmajor Governmental Funds 4,296 - - 4,296
Proprietary Fund:

Sewer Enterprise Fund - 102,545 - 102,545
Total $ 117,545 4,296 $ 53,592 $ 175,433 $
Transfers In
Governmental Funds
Proprietary
Funds
The City’s routine transfers include transfers made to move: (a) unrestricted revenues or balances that have been collected or accumulated in the General Fund to other funds based on budgetary authorization; and, (b) revenues from a fund that by statute or budgetary authority must collect them to funds that are required by statute or budgetary authority to expend them. All transfers during the year were routine and all balances are expected to be collected in the subsequent year.

Due From/To Other Funds - At June 30, 2023, the City had the following due from/to other funds:

Due from Other Funds General Fund
ADAP and
Home Special
Revenue Fund
CDBG Special
Revenue Fund
Low and Mod
Income
Housing
Special
Nonmajor
Governmental
Funds
Water
Enterprise
Fund
Internal
Service Fund Total
Governmental Funds:

General Fund - $ - $ 51,662 $ 1,031,128 $ 457,766 $ 86,972 $ 1,214,673 $ $ 2,842,201 Gas Tax Special Revenue Fund - - - - 113,081 - 263,237 376,318 ADAP and Home Special
Revenue Fund - - 313,369 - - - - 313,369
CDBG Special Revenue Fund - 12,464 - - - - - 12,464
Nonmajor Governmental Funds 1,964,253 - - - - - 730,706 2,694,959 Proprietary Fund:

Sewer Enterprise Fund - - - - 15,080 - - 15,080
Total $ 12,464 1,964,253 $ 365,031 $ 1,031,128 $ 585,927 $ 86,972 $ 2,208,616 $ 6,254,391 $ Governmental Funds Proprietary Funds
Due to Other Funds
City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
63 Note 4 – Lease Receivable
On July 1, 2021, the City entered into a 30‐month lease as Lessor for the use of 2801 Silver Street. An lease receivable was recorded in the amount of $29,767. The lessee is required to make monthly fixed payments of $1,000. The lease has an interest rate of 0.6450%. The value of the deferred inflow of resources as of June 30, 2023 was $5,954, and the City recognized lease revenue of $11,106 during the fiscal year. As of June 30, 2023, the value of the lease receivable is $5,989.

On July 1, 2021, the City entered into a 108‐month lease as Lessor for the use of real property identified as Parcel Two (APN 201‐740‐063). An initial lease receivable was recorded in the amount of $20,332. The lessee is required to make monthly fixed payments of $200. The lease has an interest rate of 1.5690%. The value of the deferred inflow of resources as of June 30, 2023 was $15,842, and the City recognized lease revenue of $2,130 during the fiscal year. As of June 30, 2023, the value of the lease receivable is $16,079.

On July 1, 2021, the City entered into a 164‐month lease as Lessor for the use of 2800 Douglas Street. An initial lease receivable was recorded in the amount of $7,270. The lessee is required to make monthly fixed payments of $50. The lease has an interest rate of 1.8110%. The value of the deferred inflow of resources as of June 30, 2023 was $6,206, and the City recognized lease revenue of $532 during the fiscal year. As of June 30, 2023, the value of the lease receivable is $6,306.

On July 1, 2021, the City entered into a 270‐month lease as Lessor for the use of 1266 Aspen Drive. An initial lease receivable was recorded in the amount of $241,652. The lessee is required to make annual fixed payments of $10,350.

The lease has an interest rate of 2.0920%. The value of the deferred inflow of resources as of June 30, 2023 was $220,171, and the City recognized lease revenue of $5,458 during the fiscal year. The lessee has 4 extension option(s), each for 60 months. As of June 30, 2023, the value of the lease receivable is $228,371.

Future annual lease receivables as of June 30, 2023 are as follows:

Fiscal Year Principal Interest Total
2024 15,767 $ 5,136 $ 20,903 $
2025 9,970 4,932 14,903
2026 10,166 4,736 14,903
2027 10,366 4,536 14,903
2028 10,570 4,332 14,903
2029 - 2033 58,203 18,236 76,439
2034 - 2038 67,704 12,001 79,705
2039 - 2043 73,999 4,708 78,705
Total $ 58,617 256,745 $ 315,364 $
City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
64 Note 5 – Capital Assets
A. Governmental Activities
A summary of changes in the capital assets for the governmental activities for the year ended June 30, 2023 is as follows:

Balance
July 1, 2022 Balance
(As Restated) Additions Deletions Transfers June 30, 2023 Capital assets, not being depreciated:

Land 2,902,940 $ - $ - $ - $ 2,902,940 $
Construction in progress 110,085 1,801,240 - - 1,911,325 Total capital assets, not being depreciated 3,013,025 1,801,240 - - 4,814,265 Capital assets, being depreciated:

Buildings 5,129,436 - - - 5,129,436
Improvements 31,317,431 272,893 - - 31,590,324
Equipment 4,015,955 819,633 - (33,379) 4,802,209
Total capital assets, being depreciated 40,462,822 1,092,526 - (33,379) 41,521,969 Less accumulated depreciation for:

Buildings (3,174,503) (99,446) - - (3,273,949)
Improvements (12,182,917) (975,519) - - (13,158,436)
Equipment (2,997,250) (278,912) - 33,379 (3,242,783)
Total accumulated depreciation (1,353,877) (18,354,670) - 33,379 (19,675,168) Total capital assets, being depreciated, net (261,351) 22,108,152 - - 21,846,801 Intangible assetes, being amortized:

Right-to-use leased equipment 165,059 - - - 165,059
Right-to-use leased vehicles 843,014 183,048 - - 1,026,062 Right-to-use subscription assets 84,717 - - - 84,717
Total capital assets, being amortized 183,048 1,092,790 - - 1,275,838 Less accumulated amortization for:

Right-to-use leased equipment (26,142) (27,398) - - (53,540) Right-to-use leased vehicles (155,802) (275,165) - (430,967) Right-to-use subscription assets - (42,358) - - (42,358) Total accumulated amortization (344,921) (181,944) - - (526,865) Total intangible assets, being amortized, net (161,873) 910,846 - - 748,973 Governmental activities capital assets, net $ 1,378,016 26,032,023 $ - $ - $ 27,410,039 $ Governmental Activities
Depreciation and amortization expenses were charged to functions/programs of the governmental activities for the fiscal year ended June 30, 2023 as follows:

Depreciation Amortization
General government 56,677 $ 69,756 $
Public safety 114,791 275,165
Public works 431,658 -
Community development 545,892 -
Recreation and cultural 204,859 -
Total depreciation and amortization expense $ 344,921 1,353,877 $ City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
65 Note 5 – Capital Assets (Continued)
B. Business-Type Activities
A summary of changes in the capital assets for the business-type activities for the year ended June 30, 2023 is as follows:

Balance Balance
July 1, 2022 Additions Deletions Transfers June 30, 2023 Capital assets, not being depreciated:

Construction in progress 287,550 $ 3,858 $ - $ (287,550) $ 3,858 $ Total capital assets, not being depreciated 287,550 3,858 - (287,550) 3,858 Capital assets, being depreciated:

Buildings 914,788 87,507 - - 1,002,295
Improvements 22,721,976 - - 287,550 23,009,526
Equipment 983,613 - - - 983,613
Total capital assets, being depreciated 24,620,377 87,507 - 287,550 24,995,434 Less accumulated depreciation:

Buildings (765,708) (18,432) - - (784,140)
Improvements (12,783,050) (476,798) - - (13,259,848)
Equipment (550,277) (45,716) - - (595,993)
Total accumulated depreciation (14,099,035) (540,946) - - (14,639,981) Total capital assets, being depreciated, net 10,521,342 (453,439) - 287,550 10,355,453 Business-type activities capital assets, net $ (449,581) 10,808,892 $ - $ - $ 10,359,311 $ Business-Type Activities
Depreciation expense for business-type activities for the year ended June 30, 2023 was charged as follow:

Depreciation
Water enterprise fund 238,469 $
Sewer enterprise fund 302,477
Total depreciation expense $ 540,946
City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
66 Note 6 – Long-Term Liabilities
A. Governmental Activities
A summary of changes in long-term liabilities for governmental activities for the year ended June 30, 2023 is as follows:

Balance
July 1, 2022 Balance Due within Due in more
(As Restated) Additions Deletions June 30, 2023 One Year One Year Revenue bonds:

CSDA Wastewater Revenue Bonds,
Series 2007 A 955,000 $ - $ (60,000) $ 895,000 $ $ 830,000 65,000 $ Financing leases:

California Infrastructure and Economic
Development Bank 612,179 - (32,698) 579,481 545,772 33,709 Redding Joint Powers Authority 13,451 - (6,539) 6,912 - 6,912 Tri-Counties Bank 12,972 60,232 (16,306) 56,898 43,009 13,889 Municipal Finance Corporation (Sweeper) 246,291 - (59,311) 186,980 126,186 60,794 Municipal Finance Corporation (Vactor truck) 300,000 - (55,721) 244,279 186,496 57,783 Other liabilities:

Lease liabilities 765,156 183,047 (316,216) 631,987 427,675 204,312 Subscription payable 84,717 - (41,972) 42,745 - 42,745
Compensated absences 429,577 186,196 (110,285) 505,488 376,225 129,263 Total $ 729,475 3,119,343 $ (699,048) $ 3,149,770 $ 614,407 $ 2,535,363 $ Typically, the General Fund has been used to liquidate the liability for compensated absences.

California Statewide Communities Development Authority (CSDA) Wastewater Revenue Bonds, Series 2007A
Issued December 1, 2007, to finance the construction of additional emergency storage capacity of an additional 3 million gallons, payable from sewer usage charges levied with property tax assessments. The balance is due in annual installments of $35,000 to $100,000 through October 1, 2033, bearing interest rates of 4.000% to 4.700% payable semi‐annually on April 1 and October 1.

The amount outstanding at June 30, 2023 totaled $895,000. The annual debt service requirements on these bonds are as follows:

Fiscal Year Principal Interest Total
2024 65,000 $ 39,733 $ 104,733 $
2025 70,000 36,695 106,695
2026 70,000 33,545 103,545
2027 75,000 30,283 105,283
2028 75,000 26,908 101,908
2029-2033 440,000 76,765 516,765
2034 100,000 2,350 102,350
Total 895,000 $ 246,279 $ 1,141,279 $
City of Anderson
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2023
67 Note 6 – Long-Term Liabilities (Continued)
A. Governmental Activities (Continued)
California Infrastructure and Economic Development Bank Issued September 1, 2006, for the purpose of the construction, acquisition, and installation of the Anderson Teen Center/Shasta County Public Health Building. The balance is due in annual installments of $20,715 to $50,068 through August 1, 2036, bearing an interest rate of 3.09% payable semi‐annually on February 1 and August 1. The amount outstanding at June 30, 2023 was $579,481.