Calexico City Council
May 4, 2022

AGENDA
ITEM
7 CITY COUNCIL

AGENDA STAFF REPORT
DATE: May 4, 2022
TO:

APPROVED BY:

PREPARED BY:

Mayor and City Council ~ \
Diego Favila, Interim City Manager ~
Sandra L. Fonseca, Interim Finance Director~arik~
SUBJECT: Receive and File 2020-21 Audited Financial Statements ======================================================================= Recommendation:

This report transmits the City's 2020-21 audited financial statements. It is recommended that the City Council receive a presentation from the City's independent auditor with the results of their audit. This report is for information only.

Background:

Each year the City contracts with a Certified Public Accountant to conduct an independent audit of the City's financial statements. The Pun Group has conducted the 2020-21 audit. The audit is now complete and the financial statements have been published.

The City's annual financial statements meet the requirements of Muni Code Section 2.14.050 which requires the Finance Director to submit "a complete financial statement and report for the preceding year." City bond covenants and grant programs also require an annual independent audit of the City's financial statements. The City's financial report is prepared using generally accepted accounting principles established by the Government Accounting Standards Board.

Discussion & Analysis:

The City's auditors have issued the following reports which are included as attachments to this staff report:

1. Basic Financial Statements and Independent Auditor's Report, June 30, 2021 This report includes the City's financial position as of June 2021 and the results of 2020-21 operations for the General Fund and other individual City program funds. The report also includes City-wide financial statements which are presented on the full accrual basis of accounting and include long-term bond, pension, and retiree medical obligations.

AGENDA
ITEM
7 2. Transportation Development Act Article 3 and Se (Non-Transit), June 30, 2021and2010 This annual report is required by the State Transportation Development Act. This document reports on the status of the City's Article 3 (pedestrian and bicycle) and Article Se (other street/non-transit) state grant programs.

3. Single Audit, June 2021
This report provides the information about the City's Federal grant expenditures and compliance with grant requirements.

4. Report to Those Charged with Governance
This report provides the auditor's annual communication with the City Council about the audit process, accounting policies, use of estimates, and reports issued.

5. Appropriations Limit Schedule, June 2021
This report provides information about the annual spending limit calculation required by Article XlllB of the State Constitution (the Gann Initiative).

Fiscal Impact
General Fund
The audited General Fund balance improved during 2020-21 to approximately $2,000,000 and has reached a 13% contingency reserve of annual expenditures. This audited General Fund balance is consistent with the information previously presented to City Council during the 2020- 21 2nd quarter report on February 2, 2022.

Other Significant Long-term Liabilities
The June 30, 2021 financial statements report the following balances for several significant longterm liabilities. These liabilities have arisen over time and are not short-term budget issues but can be expected to impact future year budgets as payments become due. Each of these obligations has an annual amortization schedule to pay down the debt over time with the exception of the Retiree Medical Liability. Long-term funding options for the Retiree Medical liability are being developed for City Council consideration during the upcoming 2022-23 budget cycle. A long-term plan to pay down each of these liabilities will position the City to continue to restore its financial position and build long-term sustainability over time.

Obligations for Past Service/Operating Costs
$30.2 million Net Pension Liability-Unfunded portion of earned service credit $39.4 million Retiree Medical/OPES- Unfunded portion of earned medical benefits 2 Obligations for Capital-related Long-Term Debt
$ 7 .1 million Measure H Bond Principal (matures 2030)
$21 .6 million Measure D Bond Principal (matures 2038)
$15.8 million Water Bond Principal (matures 2051)
$22.1 million Wastewater Bond Principal (matures 2051)
$20.8 million Successor Agency Bond Principal (matures 2033) Attachments:

1. Basic Financial Statements and Independent Auditor's Report, June 30, 2021

2. Transportation Development Act Article 3 and Be (Non-Transit), June 30, 2021 and 2020

3. Single Audit, June 2021

4. Report to Those Charged with Governance, April 22, 2022

5. Appropriations Limit Schedule, June 2021
3 ATTACHMENT NO. 1
Basic Financial Statements and Independent Auditor's Report, June 30, 2021 81211.00100\34500529.1
City of Calexico
Calexico, Calif omia
Basic Financial Statements and
Independent Auditors' Reports
For the Year Ended June 30, 2021
THE .

PUNGilOUP
i\CCO UNTANTS & AD VISO llS

City of Calexico
Basic Financial Statements
For the Year Ended June 30, 2021
Table of Contents

FINANCIAL SECTION
Independent Auditors' Report ... ................... .. .......................................................... ... ..................... ............................ 1 Basic Financial Statements:

Government-Wide Financial Statements:

Statement of Net Position ...................... ................. ..................................... ................................ ...... ... .. ..... ........ 8 Statement of Activities and Changes in Net Position ........................................................................................ 10 Fund Financial Statements:

Governmental Fund Financial Statements:

Balance Sheet ................................................................. ................ ......... ............. ....... .............. .. ................ 16 Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement ofNet Position ............................................................................ 19 Statement of Revenues, Expenditures, and Changes in Fund Balances ..................................................... 20 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 ........................................................................... 22 Proprietmy Fund Financial Statements:

Staternent of Net Position ........................................................................................................................... 24 Statement of Revenues, Expenses, and Changes in Net Position ............................................................... 27 Staternent of Cash Flows ...................................................................... ......... .......... .. ................................. 28 Fiducimy Fund Financial Statements:

Statement of Fiduciary Net Position .............................. ....... .... .. ..... .... ... .............................. ......... ............. 33 Statement of Changes in Fiduciary Net Position ........................................................................................ 34 Notes to the Basic Financial Statements .................................................................................................................. 41 Required Supplementary Information (Unaudited):

Notes to the Budgetary Infonnation ................................... ......... ............................................................................ 97 Budgetary Comparison Schedules:

General Fund ........................... .. .............. .................................... ...................................... ...... ........... ............... 98 LT A Measure D Special Revenue Fund ............................................................................................................ 99 Other Operating Grants Special Revenue Fund ...................................................................................... .. ...... 100 Schedules of the City's Prop01tionate Share of the Net Pension Liability and Related Ratios ............................. 101 Schedule of Changes in the Net Pension Liability and Related Ratios .................................................................. 102 Schedule of Contributions ..................................................................................................................... ................. 104 Schedule of Changes in Net OPEB Liability and Related Ratios ............ ...................... .. .. .................................... 106 FINANCIAL SECTION (Continued)
Supplementary Information:

Non-Major Governmental Funds:

City of Calexico
Basic Financial Statements
For the Year Ended June 30, 2021
Table of Contents (Continued)
Co1nbining Balance Sheet ............................................................................................................................... 110 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances ....... .................... ............ 117 Internal Service Funds:

Statement ofNet Position ................................................................................................... ............................. 126 Statement of Revenues, Expenses, and Changes in Net Position ........................ ......................... ................... 128 Statement of Cash Flows ................................................ ......................... ................................... .................. ... 130 All Agency Funds:

Combining Statement of Fiduciary Net Position ............. .................... ............ .... ....... .. .......... ......................... 137 Statement of Changes in Fiduciary Assets and Liabilities .................. .. .. ........ .... ............................................ 138 ii
1HE II

PUN GROUP
ACCOUNTANTS & ADVISOR.S
To the Honorable City Council
of the City of Calexico
Calexico, California
Report on Financial Statements

INDEPENDENT AUDITORS' REPORT
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 Calexico, California (the "City"), as of and for the year ended June 30, 2021, and the related notes to the basic financial statements, which collectively comprise the City's basic financial statements as listed in the table of contents.

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; this includes 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.

Auditors' Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. 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. Those standards require that we plan and perfonn the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the City's preparation and fair presentation of the financial statements 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, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
4660 La Jolla Village Drive, Suite 100, San Diego, California 92122 www.pungroup.cpa
To the Honorable City Council
of the City of Calexico
Calexico, California

Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, business-type activities, and each major fund, and the aggregate remaining fund information of the City, as of June 30, 2021, 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.

Emphasis of a Matter
Implementation of GASE Statement No. 84
As discussed in Note 1 to the financial statements, the City implemented GASB Statement No. 84, FiduciGJy Activities. As a result of the implementation, the City converted the former agency funds, which previously reported assets and liabilities only, to custodial funds and reported a restatement of its net position in the amount of $1,566,597. Our opinion is not modified with respect to this matter.

Other Matters
Required SupplementGJy Information
Accounting principles generally accepted in the United States of America require that the Budgetary Comparison Schedules, the Schedule of the City's Prop01tionate Share of Net Pension Liability and Related Ratios, the Schedule of Changes in Net Pension Liability and Related Ratios, the Schedule of Contributions, and the Schedule of Changes in Total OPEB Liability and Related Ratios, on pages 97 through 106 be presented to supplement the basic financial statements. Such information, although not a pait of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential pa1t of financial rep01ting 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.

Management has omitted the management's discussion and analysis that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing 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 pa1t of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. Our opinion on the basic financial statements is not affected by this missing information.

Other 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 Combining Nonmajor Fund Financial Statements are presented for purposes of additional analysis and are not a required pait of the basic financial statements. 2 To the Honorable City Council
of the City of Calexico
Calexico, California

The Combining Nonmajor Fund Financial Statements on pages 110 through 138 are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such 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 Nonmajor Fund Financial Statements are fairly stated in all material respects in relation to the basic financial statements as a whole.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our repmi dated April 22, 2022, on our consideration of the City's internal control over financial reporting and on our tests of its compliance with ce1iain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial repmiing and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral paii of an audit performed in accordance with Government Auditing Standards in considering the City's internal control over financial repmiing and compliance.

San Diego, California
April 22, 2022
3 This page i11te11tio11ally left blank.
4 BASIC FINANCIAL STATEMENTS
5 This page i11te11tio11al(I' left blank.
6 GOVERNMENT-WIDE FINANCIAL STATEMENTS
7 ASSETS
Current assets:

Cash and investments
Receivables:

Accounts
Intergovernmental
Inventories and prepaid items
Deposits
Total current assets
Noncurrent assets:

Cash and investments with fiscal agents
Capital assets:

Non-depreciable assets
Depreciable assets, net
Total capital assets, net
Total noncurrent assets
Total assets

DEFERRED OUTFLOWS OF RESOURCES
Deferred amount on refunding, net
Pension-related deferred outflows of resources
OPEB-related deferred outflows of resources
Total deferred outflows of resources
See accompanying Notes to the Basic Financial Statements.

City of Calexico
Statement of Net Position
June 30, 2021
$
8 Governmental
Activities
23,916,816
587,908
5,175,158
250,486
175,000
30,105,368
17,260,502
17,398,534
58,978,449
76,376,983
93,637,485
123,742,853
5,372,391
3,847,955
9,220,346
Primary Government
$
Business-Type
Activities
30,394,420
3,142,753
51,510
39,141
33,627,824
38,768,327
5,228,115
44,329,032
49,557,147
88,325,474
121,953,298
82,010
1,247,496
1,201,979
2,531 ,485
$
Total
54,311,236
3,730,661
5,226,668
289,627
175,000
63,733,192
56,028,829
22,626,649
103,307,481
125,934,130
181,962,959
245,696,151
82,010
6,619,887
5,049,934
11,751,831
City of Calexico
Statement of Net Position (Continued)
June 30, 2021

LIABILITIES
Current liabilities:

Accounts payable
Accrued payroll
Interest payable
Compensated absences - due within one year
Claims payable - due within one year
Long-term debt - due within one year
Total current liabilities
Noncurrent liabilities:

Deposits payable
Compensated absences - due in more than one year
Claims payable - due in more than one year
Long-term debt - due in more than one year
Total OPEB liability
Aggregate net pension liability
Total noncurrent liabilities
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Pension-related deferred inflows of resources
Total deferred inflows of resources

NET POSITION
Net investment in capital assets
Resh·icted for:

Special projects
Debt service
Capital projects
Total restricted
Unrestricted (deficit)
Total net position
See accompanying Notes to the Basic Financial Statements. $
9 Govermnental
Activities
4,617,104
103,033
171,812
102,149
1,663,064
1,642,464
8,485,102
186,674
1,467,135
1,968,000
28,421,517
30,025,193
24,483,077
86,551 ,596
95,036,698
1,497,405
1,497,405
46,313,002
9,700,334
3,085,633
22,735,021
35,520,988
(45,404,894)
36,429,096
Primary Govenunent
$
Business-Type
Activities
426,732
14,712
213,441
10,141
770,998
1,436,024
233,393
361 ,346
40,782,797
9,378,908
5,776,111
56,532,555
57,968,579
483,845
483,845
46,853,689
19,178,670
66,032,359 $
Total
5,043,836
117,745
385,253
112,290
1,663,064
2,413,462
9,921 ,126
420,067
1,828,481
1,968,000
69,204,314
39,404, 101
30,259,188
143,084,151
153,005,277
1,981 ,250
1,981 ,250
93,166,691
9,700,334
3,085,633
22,735,021
35,520,988
(26,226,224)
102,461 ,455
City of Calexico
Statement of Activities and Changes in Net Position
For the Year Ended June 30, 2021
Program Revenues
Charges Operating Capital
for Grants and Grants and
Functions/Programs Expenses Services Conh·ibutions Contributions Primary government:

Governmental activities:

General government $ 4,194,016 $ 264,623 $ 797,081 $ 3,269 Public safety 12,627,392 1,775,762 635,981 9,459
Public works 7,772,480 2,469,139 928,293 4,737,256
Culture and recreation 1,018,052 2,193 44,382 29,379
Planning and building 693,277 747,160 35,837
Housing 6,835,251 4,000 6,912,724
Interest and fiscal charges 1,170,747
Total governmental activities 34,311,215 5,262,877 9,354,298 4,779,363 Business-type activities:

Water 8,369,844 8,092,065
Wastewater 5,560,147 5,933,907
Airport 560,531 252,852 63,315
Total business-type activities 14,490,522 14,278,824 63,315 Total primary governmen1 $ 48,801,737 $ 19,541,701 $ 9,354,298 $ 4,842,678 See accompanying Notes to the Basic Financial Statements. 10 Total
Program
Revenues
$ 1,064,973
2,421 ,202
8,134,688
75,954
782,997
6,916,724
19,396,538
8,092,065
5,933,907
316,167
14,342,139
$ 33,738,677
City of Calexico
Statement of Activities and Changes in Net Position (Continued) For the Year Ended June 30, 2021
Net (Expense) Revenue and
Changes in Net Position
Primary Government
Governmental Business-Type
Functions/Programs Activities Activities Total
Primary government:

Governmental activities:

General government $ (3, 129,043) $ $ (3, 129,043)
Public safety ( 10,206, 190) (I 0,206, 190)
Public works 362,208 362,208
Culture and recreation (942,098) (942,098)
Planning and building 89,720 89,720
Housing 81 ,473 81,473
Interest and fiscal charges (1 ,170,747) (1 ,170,747)
Total governmental activities (14,914,677) (14,914,677) Business-type activities:

Water (277,779) (277,779)
Wastewater 373,760 373,760
Airport (244,364) (244,364)
Total business-type activities (148,383) (148,383)
Total primary government (14,914,677) (148,383) (15,063,060) General revenues:

Taxes:

Prope11y taxes 6,086,852 6,086,852
Sales taxes 7,089,470 7,089,470
Transit occupancy taxes 341,221 341 ,221
Franchise fees 674,375 674,375
Non-regulatory business license tax 763,386 763,386
Other taxes 453,120 453, 120
Total taxes 15,408,424 15,408,424
Investment earnings 598,401 30,337 628,738
Miscellaneous 15,354 675 16,029
Gain on sale of capital assets 39,204 39,204
Total general revenues 16,022,179 70,216 16,092,395
Changes in net position 1,107,502 (78, 167) 1,029,335
Net position - beginning of year 35,321,594 66,110,526 101,432,120 Net position - end of year $ 36,429,096 $ 66,032,359 $ 102,461,455 See accompanying Notes to the Basic Financial Statements. 11 This page i11te11tio11al/y left blank.
12 FUND FINANCIAL STATEMENTS
13 This page i11te11tio11a/(11 /eft blank.
14 GOVERNMENTAL FUND

FINANCIAL STATEMENTS
General Fund - This is the primary operating fund of the City. It is used to account for all revenues and expenditures that are not required to be accounted for in another fund.

LTA Measure D Special Revenue Fund - This fund accounts for revenues from 0.5% retail and use tax used for transportation improvements to repair and rehabilitate existing roadways, reduce congestion and improve safety, and to provide for construction of needed facilities.

Measure D Capital Projects Fund - This fund accounts for the capital outlay of bond proceeds issued to finance transportation improvements to repair a.nd rehabilitate existing roadways, reduce congestion and improve safety, and to provide for construction of needed facilities.

Measure H Capital Projects Fund - This fund accounts for the capital outlay of bond proceeds issued to finance a fire station and various park and recreation improvements.

Other Operating Grants Special Revenue Fund - This fund accounts for revenues from intergovernmental operating grants that are not included specified grant funds.

IS
ASSETS
Cash and investments
Cash and investments with fiscal agents
Receivables:

Accounts
Intergovernmental
Due from other funds
Inventories and prepaid items
Total assets

LIABILITIES AND

FUND BALANCES
Liabilities:

Accounts payable and accrued liabilities
Accrued payroll
Due to other funds
Deposits payable
Unearned revenue
Total liabilities
Fund Balances:

Non-spendable
Restricted
Unassigned (deficit)
Total fund balances
Total liabilities and fund balances
See accompanying Notes to the Basic Financial Statements. $
$
$
$
City of Calexico
Balance Sheet
Governmental Funds
June 30, 2021
Major Funds
L TA Measure D Measure D Measure H
General Special Revenue Capital Projects Capital Projects Fund Fund Fund Fund
$ 6,450,057 $ $
6,699,869 7,197,296
502,852
3,441 ,806
2,983,994
79,973
4,024,631 $ 9,434,051 $ 6,699,869 $ 7,197,296
603,835 $ $ 1,167,482 $ 1,504,997
76,035
1,196,274 2,983,994 3,633,922
148,021
1,500
2,025,665 4,151 ,476 5,138,919
79,973
9,434,051 2,548,393 2,058,377
1,918,993
1,998,966 9,434,051 2,548,393 2,058,377
4,024,631 $ 9,434,051 $ 6,699,869 $ 7,197,296
16 ASSETS
Cash and investments
Cash and investments with fiscal agents
Receivables:

Accounts
Intergovernmental
Due from other funds
Inventories and prepaid items
Total assets

LIABILITIES AND

FUND BALANCES
Liabilities:

Accounts payable and accrued liabilities
Accrued payroll
Due to other funds
Deposits payable
Unearned revenue
Total liabilities
Fund Balances:

Non-spendable
Restricted
Unassigned (deficit)
Total fund balances
Total liabilities and fund balances
See accompanying Notes to the Basic Financial Statements.

City of Calexico
Balance Sheet (Continued)
Governmental Funds
June 30, 2021
Major Funds
Other
Operating
Grants
$ 155,715
35,838
$ 191 ,553
$ 35,838
155,715
191,553
$ 191,553
17 Non-Major Total
Governmental Governmental
Funds Funds
$ 17,176,044 $ 23,781,816
3,363,337 17,260,502
22,250 525,102
1,697,514 5,175,158
1,881 ,011 4,865,005
79,973
$ 24,140,156 $ 51 ,687,556
681,213 $ 3,993,365
3,318 79,353
1,518,308 9,332,498
38,653 186,674
28,261 185,476
2,269,753 13,777,366
79,973
21 ,480,167 35,520,988
913,236 2,832,229
21,870,403 37,910,190
$ 24,140,156 $ 51,687,556
This page i11te11tio11al(v left blank.
18 City of Calexico
Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position
June 30, 2021
Total Fund Balances - Total Governmental Fund!
Amounts reported for governmental activities in the Statement of Net Assets were different because:

Capital assets used in governmental activities were not current financial resources and therefore were not reported in the governmental funds.

Nondepreciable
Depreciable, net of accumulated depreciation
Total capital assets
Long-term liabilities were not due and payable in the current period and therefore were not reported in the governmental funds.

Compensated absences - due within one year
Compensated absences - due in more than one year
Long-term liabilities - due within one year
Long-term liabilities - due in more than one year
Total OPEB liability
Aggregate net pension liability
Total reported in Government-Wide Statement of Net Position Pension-related deferred outflows/inflows of resources in the governmental activities were not current financial resources (uses) and therefore were not repo1ied in the Governmental Funds Balance Sheet.

Pension-related deferred outflows of resources
Pension-related deferred inflows of resources
OPEB-related deferred outflows/inflows of resources in the governmental activities were not cunent financial resources (uses) and therefore were not reported in the Governmental Funds Balance Sheet.

OPEB-related deferred outflows of resources
Interest payable on long-term debt did not require current financial resources. Therefore, interest payable was not reported as a liability in the goverrunental funds.

Internal service funds were used by management to charge the costs of certain activities to individual funds. The assets and liabilities of the internal service funds were included in governmental activities in the Government-Wide Statement of Net Position.

Net Position of Governmental Activities
See accompanying Notes to the Basic Financial Statements. 19 $
$
37,910,190
17,398,534
58,978,449
76,376,983
(102,149)
(1,467,135)
(1,642,464)
(28,421,517)
(30,025, 193)
(24,483,077)
(86,141 ,535)
5,372,391
(1,497,405)
3,847,955
(171,812)
732,329
36,429,096
City of Calexico
Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds
For the Year Ended June 30, 2021
Major Funds
LT A Measure D Measure D Measure H
General Special Revenue Capital Projects Capital Projects Fund Fund Fund Fund
REVENUES:

Property taxes $ 2,848,208 $ $ $
Other taxes 8,276,170
Licenses and permits 1,771 ,426
Intergovernmental 3,554,510 1,045,280
Charges for services 1,798,728
Fines and forfeitures 131 ,941
Use of money and property 571 ,243 5,345 1,706 368
Other revenues 15,304
Total revenues 18,967,530 1,050,625 1,706 368
EXPENDITURES:

Current:

General government 3,372,070
Public safety 10,450,164
Public works 909,657 150,000
Culture and recreation 815,845
Planning and building 677,159
Housing 86,418
Capital outlay 98,504 97,353 5, 122,8 14 4,446,944
Debt service:

Principal 33,600
Interest and fiscal charges 10,756
Total expenditures 16,454,173 247,353 5,122,814 4,446,944

REVENUES OVER (UNDER)
EXPENDITURES 2,513,357 803,272 (5,121,108) (4,446,576)
OTHER FINANCING SOURCES (USES):

Transfers in 355,622
Transfers out (1,520,154)
Total other financing sources (uses) (1,520, 154) 355,622 NET CHANGE IN FUND BALANCE 993,203 I, 158,894 (5, 121, 108) (4,446,576) FUND BALANCES:

Beginning of year 1,005,763 8,275,157 7,669,501 6,504,953 End of year $ 1,998,966 $ 9,434,051 $ 2,548,393 $ 2,058,377 See accompanying Notes to the Basic Financial Statements. 20 City of Calexico
Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Governmental Funds
For the Year Ended June 30, 2021
Major Funds
Other Non-Major Total
Operating Governmental Governmental
Grants Funds Funds
REVENUES:

Property taxes $ $ $ 2,848,208
Other taxes 8,276,170
Licenses and permits 1,771,426
Intergovernmental 6,728,388 5,883,935 17,212,113
Charges for services 2,727,178 4,525,906
Fines and forfeitures 131,941
Use of money and prope1iy 46,970 625,632
Other revenues 7,844 23,148
Total revenues 6,728,388 8,665,927 35,414,544
EXPENDITURES:

Current:

General government 35,285 305,516 3,712,871
Public safety 765,338 11,215,502
Public works 3,721,448 4,781,105
Culture and recreation 40,763 856,608
Planning and building 35,837 4,688 717,684
Housing 6,657,266 109,146 6,852,830
Capital outlay 1,002,645 10,768,260
Debt service:

Principal 1,510,000 1,543,600
Interest and fiscal charges 1,276,550 1,287,306
Total expenditures 6,728,388 8,736,094 41,735,766

REVENUES OVER (UNDER)
EXPENDITURES (70,167) (6,321,222)
OTHER FINANCING SOURCES (USES):

Transfers in 23,336 1,590,296 1,969,254
Transfers out (449,100) (1,969,254)
Total other financing sources (uses) 23,336 1,141,196
NET CHANGE IN FUND BALANCE 23,336 1,071,029 (6,321,222) FUND BALANCES:

Beginning of year (23,336) 20,799,374 44,231,412
End of year $ $ 21,870,403 $ 37,910,190
See accompanying Notes to the Basic Financial Statements. 21 City of Calexico
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, 2021
Net Change in Fund Balances - Total Governmental Funds
Amounts reported for governmental activities in the Statement of Activities were different because:

Governmental funds repo1ied capital outlay as expenditures. Capital outlay expenditures were included in the Statement of Revenues, Expenditures, and Changes in Fund Balances throughout various departments. However, in the GovernmentWide Statement of Activities, the cost of those assets was allocated over the estimated useful lives as depreciation expense.

Depreciation expense on capital assets was reported in the Govenunent-Wide Statement of Activities, but it did not require the use of current financial resources. Therefore, depreciation expense was not repo1ied as an expenditure in governmental funds.

Certain pension expenses reported in the Government-Wide Statement of Activities do not require the use of cunent financial resources and therefore, are not repmied as expenditures in governmental funds.

Changes in pension-related deferred outflows of resources Changes in net pension liabilities
Changes in pension-related deferred inflows of resources Ce1iain OPEB expenses reported in the Government-Wide Statement of Activities do not require the use of current financial resources and therefore, are not reported as expenditures in goverrunental funds.

Changes in OPEB related deferred outflows of resources
Changes in total OPEB liabilities
Changes in OPEB-related deferred inflows of resources
Long-term compensated absences were repo1ied in the Government-Wide Statement of Activities, but they did not require the use of current financial resources. Therefore, the change in long-term compensated absences was not repmied as an expenditure in governmental funds.

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

Principal payment
Capital lease payment
Amortization expenses were reported in the Government-Wide Statement of Activities and Changes in Net Position, but they did not require the use of current financial resources. Therefore, amo1iization expenses were not reported as expenditures in the Governmental Funds.

Bond premiums
Interest expense on long-term debt was reported in the Government-Wide Statement of Activities, but it did not require the use of current financial resources. The following amount represents the change in accrued interest from the prior year.

Internal service funds were used by management to charge the costs of ce1iain activities to individual funds. The net revenue of internal service funds was reported with governmental activities.

Change in Net Position of Governmental Activities
See accompanying Notes to the Basic Financial Statements. 22 $
$
(6,321 ,222)
10,768,260
(3,672,895)
670,879
(1 ,457,410)
116,925
1,408,881
(8, 778,864)
6,197,065
(153,441)
1,510,000
33,600
106,825
9,734
669,165
1,107,502

PROPRIETARY FUND

FINANCIAL STATEMENTS
Water Enterprise Fund - This fund accounts for the operation and maintenance of the City's water distribution system.

Wastewater Enterprise Fund - This fund accounts for the operation and maintenance of the City's wastewater collection system, the wastewater treatment facility, and the recycled water disposal system.

Airport Enterprise Fund - This fund is used to account for the operation and maintenance of the City's airpmt. 23 City of Calexico
Statement of Net Position
Proprietary Funds
June 30, 2021
Non-Major Internal
Major Funds Fund Service
Water Wastewater Airport Total Funds
ASSETS
Current assets:

Cash and investments $ 5,764,390 $ 24,551,376 $ 78,654 $ 30,394,420 $ 135,000 Accounts receivable, net 3,142,753 3,142,753 62,806
Intergovernmental receivables 51 ,510 51 ,510
Due from other funds 4,467,493
Deposits 175,000
Inventories and prepaid items 39,141 39,141 170,513
Total current assets 8,907,143 24,551 ,376 169,305 33,627,824 5,010,812 Noncurrent assets:

Cash and investments with fiscal agents 14,547,976 24,220,351 38,768,327 Capital assets:

Non-depreciable 2,537,721 2,414,540 275,854 5,228,115
Depreciable, net 33,106,500 7,899,694 3,322,838 44,329,032 Total net capital assets 35,644,221 10,314,234 3,598,692 49,557,147 Total noncurrent assets 50, 192, 197 34,534,585 3,598,692 88,325,474 Total assets 59,099,340 59,085,961 3,767,997 121,953,298 5,010,812

DEFERRED OUTFLOWS OF RESOURCES
Deferred amount on refunding, net 82,010 82,010
Pension-related deferred outflows of resources 746,725 500,771 1,247,496 OPES-related defeITed outflows of resources 710,118 491,861 1,201,979 Total deferred outflows of resources 1,538,853 992,632 2,531,485 See accompanying Notes to the Basic Financial Statements. 24 City of Calexico
Statement of Net Position (Continued)
Proprietary Funds
June 30, 2021
Non-Major Internal
Major Funds Fund Service
Water Wastewater Airpo1i Total Funds

LIABILITIES
Current liabilities:

Accounts payable 341 ,080 80,302 5,350 426,732 623,739
Accrued payroll 8,538 5,736 438 14,712 23,680
Interest payable 89,008 124,433 213,441
Compensated absences - due within one year 8,293 1,848 10, 141 Claims payable - due within one year 1,663,064
Long-term debt - due within one year 334,072 436,926 770,998 Total current liabilities 780,991 649,245 5,788 1,436,024 2,310,483 Noncurrent liabilities:

Deposits payable 232,881 512 233,393
Compensated absences - due in more than one year 239,928 121,418 361 ,346 Total OPEB liability 5,540,973 3,837,935 9,378,908
Aggregate net pension liability 3,457,457 2,318,654 5,776,111 Claims payable - due in more than one year 1,968,000
Long term debt - due in more than one year 17,033,834 23,748,963 40,782,797 Total noncurrent liabilities 26,505,073 30,026,970 512 56,532,555 1,968,000 Total liabilities 27,286,064 30,676,215 6,300 57,968,579 4,278,483

DEFERRED INFLOWS OF RESOURCES
Pension-related deferred inflows of resources 289,619 194,226 483,845 Total deferred inflows of resources 289,619 194,226 483,845

NET POSITION
Net investment in capital assets 32,906,301 10,348,696 3,598,692 46,853,689 Unrestricted 156,209 18,859,456 163,005 19,178,670 732,329 Total net position $ 33,062,510 $ 29,208,152 $ 3,761 ,697 $ 66,032,359 $ 732,329 See accompanying Notes to the Basic Financial Statements. 25 This page intentional(l' left blank.
26 City of Calexico
Statement of Revenues, Expenses, and Changes in Net Position Proprietary Funds
For the Year Ended June 30, 2021
Non-Major Internal
Major Funds Fund Service
Water Wastewater Airport Total Funds
OPERATING REVENUES:

Charges for services $ 8,092,065 $ 5,933,907 $ 252,852 $ 14,278,824 $ 5,864,778 Other revenue 675 675 423,179
Total operating revenues 8,092,065 5,933,907 253,527 14,279,499 6,287,957 OPERATING EXPENSES:

Salaries and benefits 3,335,648 2,107,727 98,141 5,541,516 Material, supplies, and operational expenses 2,639,660 1,779,660 195,743 4,615,063 176,800 Insurance 7,100 7,100 677,614
Claim payments 3,548,470
Claims administration 1,220,081
Depreciation 1,535,787 505,292 259,547 2,300,626
Total operating expenses 7,511,095 4,392,679 560,531 12,464,305 5,622,965 OPERATING INCOME (LOSS) 580,970 1,541,228 (307,004) 1,815,194 664,992 NONOPERATING REVENUES (EXPENSES):

Intergovernmental 63 ,315 63,315
Investment earnings 6,452 23,807 78 30,337 4,173
Interest expense (462,399) (632,610) (1,095,009)
Debt issuance costs (396,350) (534,858) (931 ,208)
Gain on disposal of assets 17,858 21,346 39,204
Total nonoperating revenues (expenses) (834,439) (1, 122,315) 63,393 (1,893,361) 4,173 INCOME (LOSS) BEFORE TRANSFERS (253,469) 418,913 (243,611) (78, I 67) 669,165 TRANSFERS:

Transfers in 383,000
Transfers out (383,000)
Total transfers
Change in net position (253,469) 418,913 (243,611) (78,167) 669,165 NET POSITION:

Beginning of year 33,315,979 28,789,239 4,005,308 66,110,526 63,164 End of year $ 33,062,510 $ 29,208,152 $ 3,761,697 $ 66,032,359 $ 732,329 See accompanying Notes to the Basic Financial Statements. 27 City of Calexico
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2021
Non-Major Internal
Major Funds Fund Service
Water Wastewater Airpo1t Total Funds
CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from customers and users $ 7,698,645 $ 5,934,944 $ 254,253 $ 13,887,842 $ 6,344,910 Cash payments to suppliers for goods and services (2,426,432) ( 1,820,269) (222,366) (4,469,067) (1,672,785) Cash payments to employees for services (2,586,922) (1,691,872) (97,994) (4,376,788) (3,291,993) Net cash provided by (used in) operating activities 2,685,291 2,422,803 (66, 107) 5,041,987 1,380, 132

CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES:

Principal paid on noncapital-related debt (843, 133)
Cash payments to other funds (2,683, 175)
Transfers in 383,000
Transfers out (383,000)
Net cash (used in) noncapital
financing activities (3,526,308)

CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:

Acquisition of capital assets (2,381, 170) (435,982) (14,594) (2,831,746) Proceeds from sale of capital assets 16,386 25,474 41,860 Intergovernmental grants 11 ,805 11,805
Proceeds from issuance of bonds 17,687,907 24,716,440 42,404,347 Principal payments on bonds (12,010,000) (580,000) ( 12,590,000) Principal payments on capital leases (38,311) (26,708) (65,019) Interest payments on debt (590, 145) (574,892) (1 ,165,037) Payment of debt issuance costs (396,350) (534,858) (931,208) Net cash provided by (used in) capital and
related financing activities 2,288,317 22,589,474 (2,789) 24,875,002 CASH FLOWS FROM INVESTING ACTIVITIES:

Interest income 6,452 23,807 78 30,337 4,173
Net cash provided by investing activities 6,452 23,807 78 30,337 4,173 Net increase (decrease) in cash and cash equivalents 4,980,060 25,036,084 (68,818) 29,947,326 (2, 142,003) CASH AND CASH EQUIVALENTS:

Beginning of year 15,332,306 23,735,643 147,472 39,215,421 2,277,003 End of year $ 20,312,366 $ 48,771,727 $ 78,654 $ 69,162,747 $ 135,000

RECONCILIATION OF CASH AND INVESTMENTS
TO STATEMENT OF NET POSITION:

Cash and investments $ 5,764,390 $ 24,551,376 $ 78,654 $ 30,394,420 $ 135,000 Cash and investments with fiscal agents 14,547,976 24,220,351 38,768,327 Total cash and investments $ 20,312,366 $ 48,771,727 $ 78,654 $ 69,162,747 $ 135,000 See accompanying Notes to the Basic Financial Statements. 28 City of Calexico
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2021
Non-Major Internal
Major Funds Fund Service
Water Wastewater Airport Total Funds

RECONCILIATION OF OPERATING INCOME
(LOSS) TO NET CASH PROVIDED
BY (USED IN) OPERA TING ACTIVITIES:

Operating income (loss) $ 580,970 $ 1,541,228 $ (307,004) $ 1,815,194 $ 664,992 Adjustments to reconcile operating income (loss) to
net cash provided by (used in) operating activities:

Depreciation 1,535,787 505,292 259,547 2,300,626
Changes in operating assets and liabilities:

Accounts receivable (394,993) 1,037 214 (393,742) 15,454 Inventories and prepaid items 773 5,661 (18,724) (12,290) (47,784) Pension-related deferred outflows (177,468) (93,106) (270,574) OPEB-related deferred outflows (254,023) (177,791) (431,814) Accounts payable 212,455 (46,270) (799) 165,386 61,591
Accrued payroll 5,307 2,730 147 8,184 (248,617)
Deposits payable 1,573 512 2,085
Compensated absences 11,628 10,370 21,998
Aggregate net pension liability 759,580 386,610 1,146,190 Total OPEB liability 1,568,016 1,102,129 2,670, 145
Claims payable 934,496
Pension-related deferred inflows (5,494) (17,115) (22,609) OPEB-related deferred inflows (1 ,158,820) (797,972) (1,956,792) Total adjustments 2,104,321 881,575 240,897 3,226,793 715,140 Net cash provided by (used in)
operating activities $ 2,685,291 $ 2,422,803 $ (66,107) $ 5,041 ,987 $ 1,380,132

SCHEDULE OF NONCASH
NONCAPITAL FINANCING ACTIVITIES:

Capital assets acquired through capital leases $ 74,897 $ 73,479 $ $ 148,376 $ Amo1iization of bond premiums 47,764 66,715 114,479
Total noncash noncapital financing activities $ 122,661 $ 140,194 $ $ 262,855 $ See accompanying Notes to the Basic Financial Statements. 29 This page i11te11tio11af{v left blank.
30 FIDUCIARY FUND

FINANCIAL STATEMENTS
Custodial Funds - These funds are used to account for money and property held by the City as trustee or custodian.

Such funds include Corsair 2013-1 Gran Plaza CFO, Towncenter CFO, Hemthstone 2005-1 CFO, and Venezia CFO.

Successor Agency to the Calexico Redevelopment Agency Private Purpose Trust Fund - This fund is used to account for monies received from the Imperial County Auditor-Controller for the repayment of the enforceable obligations of the former Redevelopment Agency of the City of Calexico. These funds are restricted for the sole purpose of payment of items on an approved Recognized Payment Obligation Schedule (ROPS). 31 This page i11te11tio11al(v left blank.
32 City of Calexico
Statement of Fiduciary Net Position
Fiduciary Funds
ASSETS
Current assets:

Cash and investments
Cash and investments with fiscal agents
Due from other governments
Inventories and prepaids
Total current assets
Noncurrent assets:

Capital assets:

Nondepreciable
Depreciable, net accumulated depreciation
Total noncurrent assets
Total assets

DEFERRED OUTFLOWS OF RESOURCES
Deferred amount on refonding, net
Total deferred outflows of resources

LIABILITIES
Current liabilities:

Accounts payable
Interest payable
Long-term debt - due within one year
Total current liabilities
Noncurrent liabilities:

Long term debt - due in more than one year
Total noncurrent liabilities
Total liabilities

NET POSITION (DEFICIT)
Restricted for:

Individuals, organizations, and other governments
Held in trust for dissolution of RDA
Total net position (deficit)
See accompanying Notes to the Basic Financial Statements.

June 30, 2021
33 $
$
Custodial
Funds
277,636
1,089,486
13,487
1,380,609
1,380,609
4,771
4,771
4,771
1,375,838
1,375,838
Successor Agency
to the Calexico
$
$
Redevelopment
Agency
4,910,723
613,333
2,267
5,526,323
1,106,663
1,663,051
2,769,714
8,296,037
937,541
937,541
674,015
348,073
1,565,000
2,587,088
20,129,136
20,129,136
22,716,224
(13,482,646)
(13,482,646)
City of Calexico
Statement of Changes in Fiduciary Net Position
Fiduciary Funds
For the Year Ended June 30, 2021
ADDITIONS:

Property taxes - Redevelopment Property Tax Trust Fund (RPTTF) Special assessments for other governments
Investment earnings
Total additions
DEDUCTIONS:

Administration
Public safety
Depreciation
Enforceable obligations
Payments - principal
Payments - interest
Interest expense and fiscal charges
Contributions to City
Total deductions
Change in net position
NET POSITION:

Beginning of year, as restated (Note 17)
End of year
See accompanying Notes to the Basic Financial Statements. 34 $
$
Custodial
Funds
872,112
597
872,709
90,271
131,753
150,000
691 ,444
1,063,468
(I 90,759)
1,566,597
1,375,838
Successor Agency
to the Calexico
Redevelopment
Agency
$ 2,258,544
5,123
2,263,667
45,877
264,332
900,992
277,704
1,488,905
774,762
(14,257,408)
$ {13,482,6462

NOTES TO THE BASIC FINANCIAL STATEMENTS
35 This page i11te11tio11al(v left blank.
36 City of Calexico
Index to the Notes to the Basic Financial Statements
For the Year Ended June 30, 2021
Note 1-Reporting Entity and Summary of Significant Accounting Policies ......................................................... 41 A. Financial Reporting Entity ................................................................................................................. ......... 41 B. Basis of Accounting and Measurement Focus ............................................................................................ 42 C. Deferred Outflows and Inflows of Resources ............................................................................................. 46 D. Cash, Cash Equivalents and Investments .................................................................................................... 46 E. Restricted Cash and Investtnents ........ ...................................... ....... ......... .. .. .............................................. 46 F. Fair Value Measurement. ............................. ........ ...... .... ..................................................... .......... ........... ... 47 G. Interfund Transactions .................... ........................................... ................................................................. 47 H. Inventories and Prepaid Ite1ns ................................................................................ .... .... ............................. 47 I. Capital Assets ................................ ... ........... ........... ..... ............................................................................... 47 J. Pensions .................................... .................................................................................................................. 48 K. Other Postemployment Benefits ("OPEB") ........................................................... ..................................... 49 L. Co1npensated Absences .............................................................................................................................. 49 M. Unearned Revenue ................................................. ........................... ...................... ............................ ........ 49 N. Long-Term Debt ...... ... .. ..... ............................................................. .............................. ........... ................... 50

0. Net Position ....... .............................. .................. ..... .................................................................................... 50 P. Fund Balances ............................................................................................................................................. 50 Q. Spending Policy .......................................................................................................................................... 51 R. Property Taxes ......................................... ................... ... .... .... .. ... ................................................................ 51 S. Use of Accounting Estimates ....... ............. ................................................................... ............................... 52 T. New Governmental Accounting Standards Implemented for the Year Ended June 30, 2021 ............................ ..................... ......... ........................................................ 52 U. Upcoming Governmental Accounting Standards Implementation ............................................................. 53 Note 2 - Cash and Investments ................................................................................................................................... 55 A. Demand Deposits ............................................................................................................... ......................... 56 B. Investments Authorized by the California Government Code and the City's Investment Policy ................................. ...................... ............ ...................................................... 56 C. Investments Authorized by Debt Agreements ........ ........ ........ ................................ ... .... ............. .. .............. 57 D. External Investment Pool .............. ................................... ........... ................................................................ 57 E. Risk Disclosures ................ ....................................................... ............. ......... .. .......... .... ..... .. .............. ....... 57 Note 3 - Notes and Loans Receivable ......................................................................................................................... 60 Note 4 - Interfund Transactions ................................................................................................................................. 62 A. Due To and Due From Other Funds .......................... ..................................................... ...... ................ ...... 62 B. Transfers In/Out ................................................ ...... ...... ... ........... .. ............................. ................................. 63 Note 5 - Capital Assets ................................................................................................................................................. 63 A. Governmental Activities .............. ........ ...................... .. .. ......... ................................ ................................. ... 63 B. Business-Type Activities .................................... ....................................................... .... ............................. 64 C. Fiduciary Funds ... ............. ..... .. .. ..................... ............. ...... ........................................... .. ... .... ..................... 65 37 City of Calexico
Index to the Notes to the Basic Financial Statements (Continued) For the Year Ended June 30, 2021
Note 6- Long-Term Debt ............................................................................................................................................ 65 A. Governmental Activities ............................................................................................................................. 65 B. Business-Type Activities ........................................................... .. ............................................................... 69 C. Fiduciary Funds ................................................................................................................................ .......... 71 D. Conduit Debt. .............................................................................................................................................. 74 Note 7 - Compensated Absences ................................................................................................................................. 75 A. Governmental Activities ....................... ... ................................................................................................... 75 B. Business-Type Activities ........................................................................... ................................................. 75 Note 8 - Risk Management .......................................................................................................................................... 76 A. Summary ..................................................................................................................................... ................ 76 B. California State Association of Cities - Excess Insurance Authority .... ..................................................... 76 Note 9- Pension Plans ................................................................................................................................................. 78 A. Summary ............................... .. .......... .. ..................................................................................................... ... 78 B. General Information about Pension Plans ................................................................................................... 79 C. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions ..................................................................................................... 81 D. Payable to the Pension Plan ........................................................................................................................ 85 Note 10- Other Postemployment Benefits ................................................................................................................. 85 A. Summary ....................................... ................................................................................................. ............. 85 B. General Information about OPEB ................................... ............................................................................ 86 C. Total OPEB Liability, OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB ........................ ................................................................................. 86 Note 11-Joint Powers Agreement - Calexico Special Financing Authority ......................................................... 89 Note 12 - Commitments and Contingencies .............................................................................................................. 90 A. Litigation ..................................................................................................................................................... 90 B. Grants ........... .. ............................................................................................................................................. 90 C. Construction ............................. .. ......................................... ........................................................................ 90 D. CFD 2013-1 ................................................................................................................................................ 91 Note 13 - Deferred Compensation Plan ..................................................................................................................... 91 Note 14 - Self-Funded Medical, Dental and Vision Plan .......................................................................................... 91 Note 15 - Other Required Disclosures ........................................................................................................................ 92 A. Deficit Fund Balances/Net Position ............................................................................................................ 92 B. Expenditures Exceeding Appropriations ........ ..... ....................................................................................... 92 38 City of Calexico
Index to the Notes to the Basic Financial Statements (Continued) For the Year Ended June 30, 2021
Note 16 - Fund Balance Classification ....................................................................................................................... 92 Note 17 - Prior Period Adjustments ........................................................................................................................... 93 A. Fiduciary Fund Financial Statements ..................................................... ........................................... .......... 93 Note 18 - Subsequent Events ....................................................................................................................................... 93 A. American Rescue Plan Act .................................... ........................................ ............................................. 93 39 This page i11te11tio11a/ly left blank.
40 City of Calexico
Notes to the Basic Financial Statements
For the Year Ended June 30, 2021
Note 1-Reporting Entity and Summary of Significant Accounting Policies The basic financial statements of the City of Calexico, California (City) have been prepared in conformity with Generally Accepted Accounting Principles of 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 standards in the United States. The more significant of the City's accounting policies are described below.

A. Financial Reporting Entity
The City was incorporated in April, 1908, under the General Laws of the State of California and enjoys all the rights and privileges pertaining to such "General Law" cities. It is governed by an elected five-member council. The City operates under a Council-Manager form of government and provides the following services: public safety (police and fire), highways and streets, culture-recreation, public improvements, planning and building (planning, building and zoning), airpo1t, public utilities (water and wastewater), and general administrative services.

In evaluating how to define the City for financial repo1ting purposes, management has considered all potential component units. The primary criteria for including a potential component unit within the rep01ting 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 govermnent. 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.

Blended Component Units
The financial rep01ting entity consists of the primary government, the City, and its component units. Component units are legally separate entities for which the elected officials of the primary government are financially accountable. In addition, component units can be other organizations for which the primary government is accountable and their exclusion would cause the rep01ting entity's financial statements to be misleading or incomplete.

Blended component units, although legally separate entities, are, in substance pait of the government's operation and so data from these units are combined with data of the primary government. Discretely presents component units, on the other hand, are rep01ted in a separate column in the combined financial statements to emphasize that they are legally separate from the government.

Although the following are legally separate from the City, they have been "blended" as though they are pait 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 units; and/or the component units provide 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.
41 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1 - Reporting Entity and Summary of Significant Accounting Policies (Continued) A. Financial Reporting Entity (Continued)
Calexico Financing Authority (the "Financing Authority") The Calexico Financing Authority is a joint powers authority, organized pursuant to a Joint Exercise of Powers Agreement, dated as of December 1, 1990 (the "Joint Powers Agreement") by and between the Successor Agency to the Community Redevelopment Agency of the City of Calexico (as successor in interest to the Community Redevelopment Agency of the City of Calexico) (the "Successor Agency") and the City. Such agreement was entered into pursuant to the provisions of Articles 1, 2 and 4 29 of Chapter 5 of Division 7 of Title I of the California Government Code (the "Act"). The Authority was created for the purpose of assisting the financing or refinancing of ce1tain public capital facilities within the City. Under the Act, the Authority may purchase bonds issued by any local agency at public or negotiated sale and may sell bonds to public or private purchasers at public or negotiated sale. The Authority is governed by a five-member board of directors, which consists of the members of the City Council of the City. The Mayor acts as the Chair of the Authority, the City Manager as its Executive Director, the City Clerk as its Secretary and the Finance Director of the City as the Treasurer of the Authority. The Authority, the City, and the Successor Agency are each separate and distinct legal entities, and the debts and obligations of each such entity are not debts or obligations of the other entity. Under the provisions of State law, the Community Redevelopment Agency of the City of Calexico was statutorily dissolved and succeeded by the Successor Agency with respect to the Joint Powers Agreement. The Authority reasonably expects that the existence of the Successor Agency will continue through at least August 1, 2033, which is later than the last maturity of the Bonds. Nonetheless, under the Trust Agreement, the Authority has covenanted to take or cause to be taken all actions reasonably necessary to continue the Authority's existence until such time as the Bonds are no longer Outstanding under the Trust Agreement, including but not limited to the addition of one or more new members to the Joint Powers Agreement.

Calexico Housing Authority (the "Housing Authority")
The Housing Authority was formed on January 31 , 2012 to develop or acquire and subsequently operate rental housing projects within the City. The Housing Authority does not issue separate financial statements.

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. Fund accounting segregates funds according to their intended purpose and is used to aid management in demonstrating compliance with finance-related legal and contractual provisions. The minimum number of funds is maintained in accordance with legal and managerial requirements.

Government-Wide Financial Statements
The City's Government-Wide Financial Statements include a Statement ofNet Position and a Statement of Activities and Changes in Net Position. These statements present summaries of governmental and business-type activities for the City accompanied by a total column. Fiduciary activities of the City are not included in these statements.

These financial statements are presented on an "economic resources" measurement focus and the accrual basis of accounting. Accordingly, all of the City's assets and liabilities, 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.
42 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1-Reporting Entity and Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus (Continued) Government-Wide Financial Statements (Continued)
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. Under the accrual basis of accounting, revenues, expenses, gains, losses, assets, deferred outflows of resources, liabilities and deferred inflows of resources resulting from exchange and exchange-like transactions are recognized when the exchange takes place. Revenues, expenses, gains, losses, assets, deferred outflows of resources, liabilities and deferred inflows of resources resulting from non-exchange transactions are recognized in accordance with the requirements of GASB Statement No. 33.

Program revenues include charges for services, special assessments, and payments made by patiies outside of the reporting government's citizenry if that money is restricted to a patiicular program. Program revenues are netted with program expenses in the statement of activities to present the net cost of each program. Program revenues for the City are classified 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 and Changes in Net Position, 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 to/from other funds
>- Advances to/from other funds
>- Transfers in/out
Government Fund Financial Statements
Governmental Fund Financial Statements include a Balance Sheet and a Statement of Revenues, Expenditures and Changes in Fund Balances. An accompanying schedule is presented to reconcile and explain the differences in Net Position as presented in these statements to the Net Position presented in the Government-Wide Financial Statements. The City has presented all major funds that met the applicable criteria.

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 presents increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets.

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. Measurable means that the amounts can be estimated, or otherwise determined. Available means that the amounts were collected during the reporting period or soon enough thereafter to be available to finance the expenditures accrued for the repmiing period. The City uses an availability period of 60 days for all revenues, with the exception of grant revenues, for which the availability period is one year.
43 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1 - Reporting Entity and Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus (Continued) Government Fund Financial Statements (Continued)
Sales taxes, property taxes, franchise taxes, gas taxes, motor vehicle in-lieu, transient occupancy taxes, grants and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period to the extent normally collected within the availability period.

Other revenue items are considered to be measurable and available when cash is received by the government.

Revenue recognition is subject to the measurable and available criteria for the governmental funds in the fund financial statements. Exchange transactions are recognized as revenues in the period in which they are earned (i.e., the related goods or services are provided). Locally imposed derived tax revenues are recognized as revenues in the period in which the underlying exchange transaction upon which they are based takes place. Imposed nonexchange transactions are recognized as revenues in the period for which they were imposed. If the period of use is not specified, they are recognized as revenues when an enforceable legal claim to the revenues arises or when they are received, whichever occurs first. Government-mandated and voluntary non-exchange transactions have been recognized as revenues when all applicable eligibility requirements have been met.

The Reconciliation of the Fund Financial Statements to the Government-Wide Financial Statements is provided to explain the differences created by the integrated approach of GASB Statement No. 34.

The City repo1ts the following major governmental funds:

General Fund - This fund accounts for all revenues and expenditures to finance the traditional services associated with a municipal government which are not accounted for in the other funds.

LTA Measure D Special Revenue Fund - This fund accounts for revenues from 0.5% retail and use tax used for transpo1tation improvements to repair and rehabilitate existing roadways, reduce congestion and improve safety, and to provide for construction of needed facilities. The repo1ted tax revenue amounts are net of amounts deposited directly to the Measure D Debt service fund which are pledged for the payment of Measure D Sales Tax Revenue Bonds.

Measure D Capital Projects Fund- This fund accounts for the capital outlay of bond proceeds issued to finance transp01tation improvements to repair and rehabilitate existing roadways, reduce congestion and improve safety, and to provide for construction of needed facilities.

Measure H Capital Projects Fund- This fund accounts for the capital outlay of bond proceeds issued to finance a fire station and various park and recreation improvements.

Other Operating Grants Special Revenue Fund - This fund accounts for revenues from intergovernmental operating grants that are not included specified grant funds.

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 Fund 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. In these funds, receivables have been recorded as revenue and provisions have been made for uncollectible amounts 44 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1-Reporting Entity and Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus (Continued) Proprietary Fund Financial Statements (Continued)
Operating revenues in the proprietary funds are those revenues that are generated from the primary operations of the fund . All other revenues are repmted as non-operating revenues. Operating expenses are those expenses that are essential to the primary operations of the fund. All other expenses are repmted as non-operating expenses.

Proprietary funds are suppmted by user fees or other restricted grant revenues and their resources in the funds are not available for general city operations. In California, voters have enacted limitations on the ability of local governments to assess taxes for general operations. User fees are an important alternate revenue tool that is available to local governments to finance specific municipal services. Because user rates are set with a nexus to the cost of service supporting the fee, they may be set by the local government outside of tax limitations. However, if user fees are redirected outside of their source program, they would no longer have a nexus to the cost of service, and would cause the revenue to become an unauthorized general tax.

The City repmts the following major proprietary funds:

Water Enterprise Fund-This fund accounts for the operation and maintenance of the City's water distribution system.

Wastewater E11te1prise Fund-This fund accounts for the operation and maintenance of the City's wastewater collection system, the wastewater treatment facility, and the recycled water disposal system.

Fiduciary Fund Financial Statements
Fiduciary fund financial statements include a Statement of Net Position and a Statement of Changes in Fiduciary Net Position. The City's fiduciary funds represent custodial funds and private purpose trust funds. Both custodial funds and the private purpose trust funds are accounted for on the full accrual basis of accounting.

Fiduciary fund types are accounted for according to the nature of the fund. The City's custodial funds are purely custodial in nature (assets equal liabilities) and thus do not involve measurement of results of operations. These funds are used to account for money and prope1ty held by the City as trustee or custodian. The City established Custodial funds and used to account for money and property held by the City as trustee or custodian.

The City's private purpose trust fund is a fiduciary fund type used by the City to report assets, liabilities and activities of the Successor Agency to the Redevelopment Agency for the City of Calexico. Its results of operations are presented on the Statement of Changes of Fiduciary Net Position.

Successor Agency of the Redevelopment Agency for the City of Calexico The Redevelopment Obligation Retirement Fund (Successor Agency) was created to serve as a custodian for the assets and to wind down the affairs of the Redevelopment Agency (RDA) on February 1, 2012, pursuant to Assembly Bill xl 26. Its purpose is to expeditiously wind down the affairs of the dissolved RDA. The Successor Agency is a separate public entity from the City, subject to the direction of an oversight board. The City Council serves as the governing board of the Successor Agency. In general, the Successor Agency's assets can only be used to pay enforceable obligations in existence at the date of dissolution (including the completion of any unfinished projects that were subject to legally enforceable contractual commitments). 45 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1-Reporting Entity and Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus (Continued) Successor Agency of the Redevelopment Agency for the City of Calexico (Continued) In future fiscal years, the Successor Agency will only be allocated revenue in the amount that is necessary to pay the estimated annual installment payments on enforceable obligations of the former RDA until all enforceable obligations of the former RDA have been paid in full and all assets have been liquidated. Based upon the nature of the Successor Agency's custodial role, the Successor Agency has been included in the accompanying basic financial statements as a private purpose trust fund.

C. Deferred Outflows and Inflows of Resources
The Statement of Net Position reports separate sections for Deferred Outflows of Resources, and Deferred Inflows of Resources, when applicable.

De(erred Outflows o(Resources represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/ expenditure) until then. The City reports Deferred Outflows of Resources for pension contributions made after the measurement date and for other pension and OPEB actuarial losses being amortized over time. See more information relating to these items in Note 9 - Pension Plans and Note 10 - Other Postemployment Benefits.

De(erred Inflows of Resources represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow ofresources (revenue) until that time. The City reports Deferred Inflows of Resources for grant revenues not collected within the availability period. The City also repmts Deferred Inflows of Resources for pension and OPEB actuarial losses being amo1tized over time. See more information relating to these items in Note 9 - Pension Plans and Note 10 - Other Postemployment Benefits.

D. Cash, Cash Equivalents and Investments
The City follows the practice of pooling cash and inveshnents 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 inveshnents with fiscal agents is credited directly to the related fund.

The City patticipates in an investment pool managed by the State of California titled Local Agency Investment Fund (LAIF) which has invested a pmiion of the pool funds in structured notes and asset-backed securities. LAIF's investments are subject to credit risk with the full faith and credit of the State of California collateralizing these investments. In addition, these structured notes and asset-backed securities are subject to market risk as to change in interest rates.

Highly liquid market investments with maturities of one year or less at time of purchase are stated at amortized cost.

All other investments are stated at fair value. Market value is used as fair value for those securities for which market quotations are readily available.

E. Restricted Cash and Investments
Cetiain restricted cash and inveshnents are held by a fiscal agent for the redemption of bonded debt and for acquisition and construction of capital projects.
46 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1 - Reporting Entity and Summary of Significant Accounting Policies (Continued) F. Fair Value Measurement
United States generally accepted accounting principles defines fair value, establishes a framework for measuring fair value, and establishes disclosures about fair value measurement. Investments, unless otherwise specified, recorded at fair value in the Statements of Net Position, 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, which 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.

G. Interfund Transactions
Activity between funds that are representative oflending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either "due to/from other funds" or "advances to/from other 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. Inventories and Prepaid Items
Inventories within the proprietary fund types consist of materials and supplies which are valued at cost on a first-in, first-out basis. Prepaid items are items that the City has paid for in advance and will provide a future benefit.

I. Capital Assets
Capital assets are valued at historical cost or estimated historical cost if actual historical cost was not available.

Donated capital assets are valued at their estimated acquisition value on the date donated. City policy has set the capitalization threshold for rep01ting capital assets at $10,000. Depreciation is recorded on a straight-line basis over estimated useful lives of the assets as follows:

Asset Type
Land improvements
Buildings and improvements
Machine1y and equipment
Licensed vehicles
Infrastrncture
Years
20 years
25-50 years
5-20 years
8 years
15-65 years
The City defines infrastructure as the basic physical assets that allow the City to function. The assets include streets, water, sewer, and park lands. Each major infrastructure system can be divided into subsystems. For example, the street system can be subdivided into pavement, curb and gutters, sidewalks, medians, streetlights, landscaping and land. These subsystems were not delineated in the basic financial statements. The appropriate operating depaitment maintains information regarding the subsystems.
47 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1-Reporting Entity and Summary of Significant Accounting Policies (Continued) L Capital Assets (Continued)
For all infrastructure systems, the City estimated the original historical cost, defined as the actual cost to acquire new prope1ty in accordance with market prices at the time of first construction/acquisition for all property in existence when the City first reported infrastructure assets. The City estimated the original historical cost, which is defined as the actual cost to acquire new prope1ty in accordance with market prices at the time of first construction/acquisition. Estimated original historical costs were developed in one of three ways: (1) historical records; (2) standard unit costs appropriate for the construction/acquisition date; or (3) present cost indexed by a reciprocal factor of the price increase from the construction/acquisition date to the current date. The accumulated depreciation, defined as the total depreciation from the date of construction/acquisition to the current date on a straight line, was computed using industry accepted life expectancies for each infrastructure subsystem. The book value was then computed by deducting the accumulated depreciation from the estimated original historical cost.

Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest on construction-related debt incurred during the period of construction for business-type and proprietary funds is capitalized as a cost of the constructed assets. Capital assets acquired under capital leases are capitalized at the net present value of the total lease payments.

Capital Assets Acquired Under Lease Purchase Contracts
The long-term principal po1tion of debt on capital assets acquired through lease purchase contracts is accounted for in the government-wide financial statements as "long-term debt - due within one year" or "long-term debt - due in more than one year". A capital asset is recorded at the net present value of the total lease payments in the government-wide financial statements.

J. Pensions
For purposes of measuring the net pension liability, deferred outflows ofresources and deferred inflows ofresources related to pensions, and pension expense, information about the fiducimy 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 (Note 9). For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with benefit terms. Investments are repmted at fair value.

The following timeframes are used for pension repmting:

Valuation Date
Measurement Date
Measurement Period:

June 30, 2019
June 30, 2020
July 1, 2019 to June 30, 2020
Gains and losses related to changes in total pension liability and fiduciary net position are recognized in pension expense systematically over time. The first ammtized 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 ammtization period differs depending on the source of the gain or loss. The difference between projected and actual earnings is ammtized straight-line over 5 years. All other amounts are amo1tized 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. 48 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1-Reporting Entity and Summary of Significant Accounting Policies (Continued) J(. Other Postemployment Benefits ("OPEB'')
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows ofresources related to OPEB, and OPEB expense, information about the fiduciary net position of the City's Retiree Benefits Plan ("OPEB Plan") and additions to/deductions from OPEB Plan's fiduciary net position have been determined on the same basis as they are reported by the Plan (Note 10). For this purpose, the OPEB Plan recognizes benefit payments when due and payable in accordance with the benefit terms. Investments are reported at fair value, except for money market investments, which are repotied at amortized cost.

The following timeframes are used for OPEB reporting:

Valuation Date
Measurement Date
Measurement Period:

June 30, 2020
June 30, 2021
July 1, 2020 to June 30, 2021
Gains and losses related to changes in total OPEB liability and fiduciary net position are recognized in OPEB expense systematically over time. The first am01iized amounts are recognized in OPEB expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to OPEB and are to be recognized in future OPEB expense. The am01iization period differs depending on the source of gain or loss. The difference between projected and actual earnings is amortized on a straight-line basis over five years. All other amounts are amortized on a straight-line basis over the average expected remaining service lives of all members that are provided with benefits (active, inactive, and retired) at the beginning of the measurement period.

L. Compensated Absences
It is the City's policy to accrue annual leave when incuned in the government-wide financial statements and in proprietary funds.

A liability is recorded for unused sick leave and unpaid vacation balances if it is probable that the unused balances will result in termination payments. This is estimated by including in the liability the unused leave balances of employees currently entitled to receive termination benefits, as well as those who are expected to become eligible to receive termination benefits as a result of continuing their employment with the City. The amounts accrued for financial statement purposes represent I 00 percent of the vacation pay liability at June 30, 2021. No liability is recorded for non-vesting accumulating rights to receive sick pay benefits. However, a liability is recognized for that p01iion of accumulating sick leave benefit that is estimated will be paid at retirement.

M. Unearned Revenue
Unearned revenue recorded in the Government-Wide Statement of Net Position for governmental activities, business-type activities, the governmental fund financial statements, and the proprietary fund financial statements, consist of federal and state capital grants, representing voluntary nonexchange transactions, for which advance payments have been received from the provider for which eligibility requirements, other than timing requirements, have not been satisfied as well as rents received in advance. 49 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1-Reporting Entity and Summary of Significant Accounting Policies (Continued) N. Long-Term Debt
Government-Wide Financial Statements
Long-te1m debt obligations are reported as liabilities in the appropriate activities.

Bond premiums and discounts are deferred and ammtized over the life of the bonds using the effective interest method. Bonds payable are reported net of applicable premium or discount.

Fund Financial Statements
The fund financial statements do not present long-term debt but debt is shown in the Reconciliation of the Governmental Funds Balance Sheet to the Government-Wide Statement of Net Position.

0. Net Position
For government-wide and proprietary fund financial statements, net position is categorized as follows:

Net Investment in Capital Assets - This component of net position consists of capital assets, net of accumulated depreciation, increased by an unspent capital-related debt proceeds and capital-related debt deferred inflows of resources, reduced by the outstanding balances of 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 inflows of resources related to those assets.

Unrestricted - This component of net position is the amount of the assets, deferred outflows of resources, liabilities, and deferred inflows ofresources that are not included in the determination ofnet investment in capital assets or the restricted component of net position.

P. Fund Balances
For governmental fund financial statements, fund balances are categorized as follows:

Nonspendable - Items that cannot be spent because they are not in spendable form, such as prepaid items and inventories and long-term receivables, 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 which are constrained, the use of which is constrained by limitations imposed by the formal action of the government's highest level of decision-making authority normally through resolutions, etc., and that remain binding unless rescinded or modified in the same manner. The City Council is considered the highest authority for the City. 50 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1 - Reporting Entity and Summary of Significant Accounting Policies (Continued) P. Fund Balances (Continued)
Assigned - Assigned fund balances encompass the p011ion 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. On June 29, 2011, the City Council adopted Resolution 2011 77 adopting the fund balance policy authorizing the Finance Director; with concurrence of the City Manager and City Council, to make the determination.

Unassigned- This amount is for any p011ion of the fund balances that do not fall into one of the above categories.

Q. Spending Policy
Government-Wide Financial Statements and the Proprietary Fund Financial Statements When an expense is incurred for purposes for which both restricted and unrestricted net position are available, the City's policy is to apply restricted net position first.

Governmental Fund Financial Statements
When expenditures are incurred for purposes where only umestricted fund balances are available, the City uses the unrestricted resources in the following order: committed, assigned, and unassigned.

R. Property Taxes
Prope11y taxes in the State of California are administered for all local agencies at the county level and consist of secured, unsecured, and utility tax rolls. The following is a summaiy of major policies and practices relating to prope11y taxes:

Property valuations - are established by the Assessor of the County of Imperial (County) for the secured and unsecured prope11y tax roll; the utility prope11y tax rolls are valued by the State Board of Equalization. Under the provisions of A11icle XIIIA of the State Constitution (Proposition 13 adopted by the voters on June 6, 1978), prope11y is assessed at 100 percent of purchase price or value in 1978 whichever is later. From this base of assessment, subsequent annual increases in valuation are limited to a maximum of 2 percent per year. However, increases to current value are allowed for property improvements or upon change in ownership. Personal prope11y is excluded from these limitations, and is subject to annual reappraisal.

Tax levies - are limited to 1 percent of full value which results in a tax rate of$1 per $100 assessed valuation, under the provision of Proposition 13. Tax rates for voter-approved indebtedness are excluded from this limitation.

Tax levy dates - are attached annually on January I of the preceding fiscal year for which the taxes are levied. The fiscal year begins July 1 and ends June 30 of the following year. Taxes are levied on both real and unsecured personal prope11y and are not relieved by subsequent renewal or change in ownership.

Tax collections - are the responsibility of the County Tax Collector. Taxes and assessments on secured and utility tax rolls constitute a lien against the prope11y and may be paid in two installments; the first installment is due on November 1 of the fiscal year and is delinquent if not paid by December 1 O; and the second installment is due on March 1 of the fiscal year and is delinquent if not paid by April 10. Unsecured personal prope11y taxes do not constitute a lien against real prope11y unless the taxes become delinquent. Payment must be made in one installment, which is delinquent if not paid by August 31 of the fiscal year. Penalties are imposed by the County for late payment. 51 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1 - Reporting Entity and Summary of Significant Accounting Policies (Continued) R. Property Taxes (Continued)
Tax levy apportionments - Under State legislation adopted subsequent to the passage of Proposition 13, appmiionments to local agencies are made by the County Auditor-Controller based primarily on the ratio that each agency represented by the total City-wide levy compared to the total County for the three years prior to fiscal year 1979.

Property tax administration fees - the State's Fiscal Year 1990-91 Budget Act authorized counties to collect administrative fees for collection and distribution of prope1iy taxes. Prope1iy taxes are recorded net of administrative fees withheld during the fiscal year.

S. Use of Accounting Estimates
The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions, in some cases when applicable, that affect the amounts in the financial statements and the accompanying notes. Actual results could differ from the estimates.

T. New Governmental Accounting Standards Implemented for the Year Ended June 30, 2021 The requirements of the following accounting standards are effective for the purpose of implementation, if applicable to the City, for the year ended June 30, 2020. The financial statements included herein apply the requirements and provisions of these statements, including necessary retroactive adjustments to financial statement classifications and presentations.

GASE Statement No. 84
In January 2017, GASB issued Statement No. 84, Fiducimy Activities. This Statement establishes criteria for identifying fiduciary activities of all state and local governments. The focus of the criteria generally is on (I) whether a government is controlling the assets of the fiduciary activity and (2) the beneficiaries with whom a fiduciary relationship exists. Separate criteria are included to identify fiduciary component units and postemployment benefit arrangements that are fiduciary activities. Application of this statement is effective for the City's fiscal year ending June 30, 2021. As a result of the implementation, the City converted the former agency funds, which previously repmied assets and liabilities only, to custodial funds and repmied a restatement of its net position in the amount of $1,566,597. See note 17.

GASE Statement No. 89
In June 2018, GASB issued Statement No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period. This Statement establishes accounting requirements for interest cost incurred before the end of a construction period. Such interest cost includes all interest that previously was accounted for in accordance with the requirements of paragraphs 5-22 of Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASE and AICPA Pronouncements, which are superseded by this Statement. This Statement requires that interest cost incurred before the end of a construction period be recognized as an expense in the period in which the cost is incurred for financial statements prepared using the economic resources measurement focus. As a result, interest cost incurred before the end of a construction period will not be included in the historical cost of a capital asset reported in a business-type activity or enterprise fund. Application of this statement did not have a material effect on the City's financial statements for the fiscal year ending June 30, 2021.
52 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1 - Reporting Entity and Summary of Significant Accounting Policies (Continued) T. New Govemmenta!Accounting Standards Implemented for the Year Ended June 30, 2021 (Continued) GASE Statement No. 90
In August 2018, GASB issued Statement No. 90, Majority Equity Interests- An Amendment of GASE Statements No. 14 and No. 61. This Statement improves the consistency and comparability of reporting a government's majority equity interest in a legally separate organization and to improve the relevance of financial statement infonnation for certain component units. It defines a majority equity interest and specifies that a majority equity interest in a legally separate organization should be reported as an investment if a government's holding of the equity interest meets the definition of an investment. A majority equity interest that meets the definition of an investment should be measured using the equity method, unless it is held by a special-purpose government engaged only in fiduciary activities, a fiduciary fund, or an endowment (including permanent and term endowments) or permanent fund . Those governments and funds should measure the majority equity interest at fair value. Application of this statement did not have a material effect on the City's financial statements for the fiscal year ending June 30, 2021.

GASE Statement No. 98
In October 2021, GASB issued Statement No. 98, The Annual Comprehensive Financial Report, to establish the term annual comprehensive financial report and its acronym ACFR. That new term and acronym replace instances of comprehensive annual financial report and its acronym in generally accepted accounting principles for state and local governments. Application of this statement did not have a material financial effect on the City's financial statements for the fiscal year ending June 30, 2021.

U. Upcoming Govemmental Accounting Standards Implementation The City is currently analyzing its accounting practices to determine the potential impact on the financial statements for the following GASB statements:

GASE Statement No. 87
In June 2017, GASB issued Statement No. 87, Leases. This Statement increases the usefulness of governments' financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract. It establishes a single model for lease accounting based on the foundational principle that leases are financings of the right to use an underlying asset. Under this Statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow ofresources, thereby enhancing the relevance and consistency of information about governments' leasing activities. Application of this statement is effective for the City's fiscal year ending June 30, 2022.

GASE Statement No. 91
In May 2019, GASB issued Statement No. 91, Conduit Debt Obligations. The primary objectives of this Statement are 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 airnngements associated with conduit debt obligations; and improving required note disclosures.

Application of this statement is effective for the City's fiscal year ending June 30, 2023 . 53 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1 - Reporting Entity and Summary of Significant Accounting Policies (Continued) U. Upcoming Governmental Accounting Standards Implementation (Continued) GASE Statement No. 92
In Januaty 2020, GASB issued Statement No. 92, Omnibus 2020. The primary objectives of this Statement are to enhance comparability in accounting and financial repotting and to improve the consistency of authoritative literature by addressing practice issues that have been identified during implementation and application of ce1tain GASB Statements. Application of this statement is effective for the City's fiscal year ending June 30, 2023.

GASE Statement No. 93
In March 2020, GASB issued Statement No. 93, Replacement of Interbank Offered Rates. Some governments have entered into agreements in which variable payments made or received depend on an interbank offered rate (IBOR)- most notably, the London Interbank Offered Rate (LIBOR). As a result of global reference rate refotm, LIBOR is expected to cease to exist in its current fotm at the end of2021, prompting governments to amend or replace financial instruments for the purpose of replacing LIB OR with other reference rates, by either changing the reference rate or adding or changing fallback provisions related to the reference rate. The objective of this Statement is to address those and other accounting and financial repotting implications that result from the replacement of an IBOR.

Application of this statement is effective for the City's fiscal year ending June 30, 2022.

GASE Statement No. 94
In March 2020, GASB issued Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangements. The primary objective of this Statement is to improve financial repotting by addressing issues related to public-private and public-public partnership arrangements (PPPs). As used in this Statement, a PPP is an arrangement in which a government (the transferor) contracts with an operator (a governmental or nongovernmental entity) to provide public services by conveying control of the right to operate or use a nonfinancial asset, such as infrastructure or other capital asset (the underlying PPP asset), for a period of time in an exchange or exchange-like transaction. Application of this statement is effective for the City's fiscal year ending June 30, 2023.

GASE Statement No. 96
In May 2020, GASB issued Statement No. 96, Subscription-Based Information Technology Arrangements. This Statement provides guidance on the accounting and financial repotting for subscription-based information technology arrangements (SBITAs) for government end users (governments). This Statement (1) defines a SBITA; (2) establishes that a SBITA results in a right-to-use subscription asset-an intangible asset-and a corresponding subscription liability; (3) provides the capitalization criteria for outlays other than subscription payments, including implementation costs of a SBIT A; and ( 4) requires note disclosures regarding a SBIT A. Application of this statement is effective for the City's fiscal year ending June 30, 2023. 54 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 1-Reporting Entity and Summary of Significant Accounting Policies (Continued) U. Upcoming Governmental Accounting Standards Implementation (Continued) GASB Statement No. 97
In June 2020, GASB issued Statement No. 97, Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans - An Amendment of GASB Statements No. 14 and No. 84, and a Supersession of GASB Statement No. 32. The primary objectives of this Statement are to (I) increase consistency and comparability related to the reporting of fiduciary component units in circumstances in which a potential component unit does not have a governing board and the primary government performs the duties that a governing board typically would perform; (2) mitigate costs associated with the reporting of ce1tain defined contribution pension plans, defined contribution other postemployment benefit (OPEB) plans, and employee benefit plans other than pension plans or OPEB plans (other employee benefit plans) as fiduciary component units in fiduciary fund financial statements; and (3) enhance the relevance, consistency, and comparability of the accounting and financial reporting for Internal Revenue Code (IRC) Section 457 deferred compensation plans (Section 457 plans) that meet the definition of a pension plan and for benefits provided through those plans. Application of this statement is effective for the City's fiscal year ending June 30, 2022.

Note 2 - Cash and Investments
The following is a summary of pooled cash and investments and restricted cash and investments at June 30, 2021:

Primary Government
Governmental Business-type Fiduciary
Activities Activities Total Funds Total
Cash and investments $ 23,916,816 $ 30,394,420 $ 54,3I1 ,236 $ 5,188,359 $ 59,499,595 Cash and investments with fiscal agent 17,260,502 38,768,327 56,028,829 1,702,819 57,731,648 Total $ 41,177,318 $ 69,162,747 $ 110,340,065 $ 6,891 ,178 $ I 17,231 ,243 Cash and investments consisted of the following at June 30, 2021 :

Cash and cash equivalents:

Petty cash $ 6,350
Demand deposits 7,260,630
Investments:

Local Agency Investment Fund 52,232,615
Money market funds 57,731 ,648
Total $ 117,231 ,243
55 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 2 - Cash and Investments (Continued)
At June 30, 2021, cash and investments, are reported at fair value based on quoted market prices. The following table represents the fair value measurements of investments recognized in the accompanying Statement of Net Position measured at fair value on a recun'ing basis and the level within the fair value hierarchy in which the fair value measurements fall at June 30, 2021:

Investments measured by fair value level :

Held by bond trustee:

Money market mutual funds
Total investments by fair value level
Investments not subject to the fair value hierarchy:

Local Agency Investment Fund - State of CA
Total investments not subject to the fair value hierarchy Total investments
A. Demand Deposits
June 30, 2021
$ 57,731 ,648
$ 57,731,648
$ 52,232,615
$ 52,232,615
$ 109,964,263
Level I Level 2 Level 3
$ $ 57,731,648 $
----- $ $ 57,731,648 $
The carrying amounts of the City's demand deposits were $7,260,630 at June 30, 2021. Bank balances were $7,433,718 at that date. The total amount of which was collateralized or insured with securities held by the pledging financial institutions in the City's name is 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, col lateral 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, which are fully insured up to $250,000 by the Federal Deposit Insurance Corporation. The City, however, has not waived the collateralization requirements.

B. Investments Authorized by the California Government Code and the City's Investment Policy The table below identifies the investment types that are authorized for the City by the California Government Code (or the City's investment policy, where more restrictive). The table also identifies ce1tain provisions of the California Government Code (or the City's investment policy, where more restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustee that are governed by the provisions of debt agreements of the City, rather than the general provisions ofthe California Government Code or the City's investment policy.

Authorized
Investment Type
Cert1t1cates of Deposit
State of California Local Agency Investment Fm1d
Savings Accounts
U.S. Treasury Obligations
U.S. Government Agency Issues
Repurchase Agreements
Maximum
Maturity
1 year
NIA
Unlimited
3 years
3 years
3 years
56 Maximum
Percentage
of Portfolio
Unl1m1ted
NIA
Unlimited
Unlimited
Unlimited
Unlimited
Maximum
Investment
in One Issuer
None
$75,000,000
None
None
None
None
City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 2 - Cash and Investments (Continued)
C. Investments Authorized by Debt Agreements
D.

Investment of debt proceeds held by bond trustees are governed by provisions of the debt agreements rather than the general provisions of the California Government Code or the City's investment policy. The table below identifies the investment types that are authorized for investments held by the bond trustee. The table also identifies ce11ain provisions of these debt agreements that address interest rate risk, credit risk, and concentration ofrisk.

Maximum Maximum
Authorized Maximum Percentage Investment
Investment Type Maturity of Portfolio in One Issuer
Cert1t1cates of Deposit None None one
U.S. Treasury Obligations None None None
U.S. Agency Securities None None None
Municipal Obligations, Prime Quality None None None
Banker's Acceptances, Prime Quality 360 days None None
Commercial Paper, Prime Quality 270 days None None
Money Market Funds, Prime Quality NIA None None
Investment Contracts None None None
Repurchase Agreements, Approve by Bond Issuer None None None External Investment Pool
The City is a pm1icipant in LAIF which is regulated by California Government Code Section 16,429 under the oversight of the Treasurer of the State of California. The City's investments in LAIF at June 30, 2021 included a p011ion of pool funds invested in Structure Notes and Asset-Backed Securities:

Structured Notes are 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, the bulk of which are mo11gage-backed securities, entitle their purchasers to receive a share of the cash flows from pool of assets such as principal and interest repayments from a pool of m011gages (such as Collateralized Mo11gage Obligations) or credit card receivables.

As of June 30, 2021, the City had $52,232,615 invested in LAIF, which had invested 1.10% of the pool investment funds in Structured Notes and Asset-Back Securities. LAIF dete1mines fair value on its inveshnent portfolio based on mmket quotations for those securities where market quotations are readily available and based on am011ized cost or best estimate for those securities where market value is not readily available. The City valued its investments in LAIF as of June 30, 2021, by multiplying its account balance with LAIF times a fair value factor determined by LAIF. This fair value factor was determined by dividing all LAIF participants' total aggregate am011ized cost by total aggregate fair value.

The credit quality rating of LAIF is unrated as of June 30, 2021.

E. Risk Disclosures
Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment.

Generally, the longer the maturity, the greater the sensitivity its fair value is to changes in market interest rates. As a means of limiting its exposure to fair value losses arising from rising interest rates, the City's investment policy provides that final maturities of securities cannot exceed five years. Specific maturities of investments depend on liquidity needs.
57 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 2 - Cash and Investments (Continued)
E. Risk Disclosures (Continued)
Disclosures Relating to Interest Rate Risk (Continued)
Information about the sensitivity of the fair values of the City's investments to market rate fluctuations is provided by the following table that shows the distribution of the City's investments by maturity as of June 30, 2021 :

Maturities
Amount 1 year or less
Investments:

Local Agency Investment Fund $ 52,232,615 $ 52,232,615
Money market funds 57,731,648 57,731 ,648
Total $ 109,964,263 $ 109,964,263
The City has no investments (including investments held by bond trustees) that are highly sensitive to interest rate fluctuations.

Disclosures Relating to 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.

However, some issuers do not seek a credit rating. For instance, the California Local Agency Investment Fund (LAIF) has not sought or received a credit rating. In these cases, the purchaser is solely responsible for performing their own due diligence before purchasing an investment or participating in an external investment pool. Ce1tificates of deposit of $250,000 or less are fully insured by the Federal Deposit Insurance Corporation (FDIC), and therefore, do not seek a credit rating.

Presented below is the minimum rating required by (where applicable) the California Government Code, the City's investment policy, or debt agreements, and the actual rating as of year-end for each investment type.

Credit Quality Ratings
Standard &
Amount Moody's Poor's
Investments:

Local Agency Investment Fund $ 52,232,615 Not Rated Not Rated Money market funds 57,731 ,648 Not Rated Not Rated
Total $ I 09,964,263
58 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 2 - Cash and Investments (Continued)
E. Risk Disclosures (Continued)
Disclosures Relating to Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government 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. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party.

At June 30, 2021, the City's deposits (bank balances) were collateralized under California Law. All securities, with the exception ofLAIF and other pooled investments, are held by a third-party custodian (BNY Western Trust). BNY is a registered member of the Federal Reserve Bank.

The investment policy of the City contains no limitations on the amount that can be invested in any one issuer beyond that stipulated in the Gov't Code. GASB Statement No. 40 requires disclosure by amount and issuer, of investments in any one issuer that represent 5% or more of total investments. Investments in any one issuer (other than U.S.

Treasury securities, mutual funds, and external investment pools) that represents 5% or more of the City's total investments are as follows:

Investment Type
Investments:

Local Agency Investment Fund
Money market funds
Total
59 Total
as of
June 30, 2021
$ 52,232,615
57,731 ,648
$ 109,964,263
Percentage
of
Investments

47.50%

52.50%
City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 3 - Notes and Loans Receivable and Allowance for Doubtful Accounts The City and Successor Agency have issued various long-term notes and loans receivable to support affordable housing and development objectives. The City rep01is its long-term notes and related interest receivable fully offset with an allowance on the Government-Wide Statement of Net Position, the Governmental Funds Balance Sheet, and the Statement of Fiduciary Net Position due to the unce1iain nature oflong-term affordable housing and development loans.

At June 30, 2021, notes and loans receivable consisted of the following:

City:

Calexico Community Action Council
De Anza Limited Partnership# I
De Anza Limited Partnership #3
De Anza Renovation
Victoria ManorSeniorApartments
California Family Apartments, LP
California Family Apartments II, LP
HPDVilla De!Este, LP
Villa Primavera Family Apartments loan
Other Joans
City notes and loans receivable total
S u c c es so r Age n c y:

Other loans
SuccessorAgencynotes and loans rece
Total notes and loans receivable
Notes/Loans
Receivable
Balance
7/1/2020
$ 306,377 $
422,977
5,000,000
759,332
200,000
400,000
3,400,000
1,363,887
5, 100,000
10,644,834
27,597,407
320,757
320,757 -----
$ 27,918,164 $
Calexico Communitv Action Council
Notes/Loans Allowance for Financial
Receivable Doubtfu!Accounts Statement
Balance Balance Balance
Additions Deletions 6/30/2021 6/30/2 021 6/3 0/202 I
$ $ 306,377 $ (306,377) $
422,977 (422,977)
5,000,000 (5,000,000)
759,332 (759,332)
200,000 (200,000)
400,000 (400,000)
3,400,000 (3,400,000)
1,363,88 7 (1,363,887)
5,100,000 (5,100,000)
147,500 (194,767) 10,597 ,5 67 (10,597,567)
~----·~----~ ----- 147,500 (194,767) 27,550, 140 (27,550,140) ~----·~----~ -----
320,757 (320,757) ----- 320,757 (320,757) ----- 147,500 $ (194 ,76 7) $ 27,870,897 $ (27,870,897) $ =====
On September 11, 1996, the City issued a promissory note to Calexico Community Action Council to supersede a prior note for development of the Alejandro Rivera Senior Citizens Apmiments II. The note bears an interest rate of 6.5% per annum. Annual payments are based on an estimated amount of the profit and shall be due and payable on December 31 of each year until the entire principal amount is paid off. At June 30, 2021, the outstanding balance was $306,377.

De Anza Limited Partnership #1
In 1997, the City loaned De Anza Limited Partnership the amount of $422,977 for the De Anza Hotel construction project. The note is secured by property. The note bears interest at a rate of 3% per annum and is due on the 16th anniversary of the date the project was placed in service. At June 30, 2021, the outstanding balance of the note was $422,977.

De Anza Limited Partnership #3
On February 12, 2012, the City loaned De Anza Limited Pminership $5,000,000 for the construction of a 54-unit apartment complex, subject to the completion of the project. The note is secured by a first assignment ofleases and rents, and a deed of trust. The note bears an interest rate of 3% per annum and is due and payable in full in 55 years from the completion of the project. The City received the notice of project completion on December 12, 2012. At June 30, 2021, the outstanding balance of the note was $5,000,000.
60 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 3 - Notes and Loans Receivable and Allowance for Doubtful Accounts (Continued) De Anza Renovation
On September 21, 2010, the City authorized the De Anza Limited Pa1tnership to borrow up to $760,000 for the De Anza Hotel earthquake rehabilitation and repair project. Borrowings are secured by a first assignment of leases and rents, and a deed of trust. Borrowings bear an interest rate of 3% per annum and are payable from residual receipts in the amount of 40% of the residual receipts and in no event less than $1,000 per year beginning March 30, 2011. At June 30, 2021, the outstanding balance of the note was $759,332.

Victoria Manor Senior Apartments
On October 19, 20 I 0, the City loaned the Housing Authority of the City of Calexico ("Authority") $200,000 in order for the Authority to purchase ce1tain real prope1ty. The note is secured by a deed of trust on the prope1ty. The note bears an interest rate of 6.25% per annum and is due at the earlier of the commencement of the term for the option agreement included with the note or nine years from the execution of the note. At June 30, 2021, the outstanding balance of the note was $200,000.

California Family Apartments, LP
On October 21, 2002, the City loaned CF A Limited Paitnership $400,000 for affordable housing projects. This note is secured by a deed of trust. The note bears interest at 6% per annum. Principal and accrued interest shall be repaid beginning on April 15, 2004 and each April 15 thereafter until repaid in full. All outstanding principal and accrued interest shall be due in full on the earlier of the eighteenth anniversary of the date of this note or the sale or other transfer of the prope1ty. At June 30, 2021, the outstanding balance of the note was $400,000.

California Family Apartments II, LP
On November 1, 2006, the Agency loaned Calexico II, LP $3,400,000 for affordable housing projects. The note bears interest at 3% and is payable annually within 90 days following the end of each calendar year, contingent upon the LP realizing a profit. At June 30, 2021, the outstanding balance of the note was $3,400,000.

HPD Villa Del Este, LP
On June 30, 2008, the Agency loaned HPD Villa Del Este, LP $1,363,887 for affordable housing projects. The note is secured by a deed of trust. The note bears interest at 3% per annum. Principal and accrued interest shall be repaid beginning January I, 2018, for each preceding calendar year in which there was a cash flow balance, and continuing annually on the first day of each and every year thereafter for the remainder of the term in which there is a cash flow balance. At June 30, 2021, the outstanding balance of the note was $1,363,887.

Villa Primavera, LLP
On November 41", 2014, the City approved a loan to Villa Primavera CIC, LP an amount not to exceed $5,100,000 for an affordable housing project for low income and senior citizens. The note is secured by a deed of trust. This promissory note bears interest at a rate of 3% per annum with a term of 55 years. Principal and accrued interest shall be repaid beginning from the date of Project Completion as defined by 24CFT 92.2, wherein the project must meet the affordability requirements contained herein. At June 30, 2021, the outstanding balance of the note was $5,100,000.

Other Loans
The City and Successor Agency have established various loan programs that assist residents of the City in purchasing and/or rehabilitating their homes and for business development. These loans are in the form offully am01tized or deferred loans. The deferred loans are usually due upon sale of property. At June 30, 2021, the outstanding balance of the City and Successor Agency loans were $10,597,567 and $320,757, respectively. 61 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 4 - Interfund Transactions
A. Due To and Due From Other Funds
Due from and to other funds as of June 30, 2021, for short-term bmrnwing pending subsequent grant, tax, or fee reimbursement, were as follows:

Receh'llblc Fund
Solid Waste Special Revenue Fund
Bravo-Victoria Eastside Village
Assessment Special Revenue Fund
Community Donations Special Revenue Fund
Community Donations Special Revenue Fund
Comnnmity Donations Special Revenue Fund
Community Donations Special Revenue Fund
General Capital Projects Fund
General Capit al Projects Fund
General Capital Projects Fund
General Liability Internal Service Fund
General Liability Internal Service Fund
General Liability Internal Service Fund
General Liability Internal Service Fund
General Liability Internal Service Fund
Payroll Internal Service Fund
Medical Active Internal Service Fund
Medical Retirees Internal Service Fund
Workers' Compensation Internal Service Fund
Unemployment Insurance Internal Service Fund
Measure D Special Revenue Fund
Payable Fund
General Fund
General Fund
El Portal Special Revenue Fund
Operation Stonegarden Special Revenue Fund
H!DT A Special Revenue Fund
New River Grants Capital Projects Fund
Capital Grants Capital Projects Fund
DIF - Fire Capital Projects Fund
New River Grants Capital Projects Fund
New River Grants Capital Projects Fund
Prop 172 Public Safety Sales
Tax Special Revenue Fund
FEM A Special Revenue Fund
State COPS Grant Special Revenue Fund
Measure H Capital Projects Fund
Measure H Cap ital Projects Fund
Measure H Capital Projects Fund
Measure H Cap ital Projects Fund
Measure H Capital Projects Fund
Measure H Cap ital Projects Fund
Measure D Capital Projects Fund
(A) Reimbursement is pending taxes receivable.
(B) Reimbursement is pending grants receivable.
(C) Reimbursement is pending bond fund drawdown.
(D) Reimbursement is pending receipt of developer fees. 62 $
Subtotal
Subtotal
Subtotal
Subtotal
Subtotal
Total $
Amount
662,113
534,16I
1,196,274
8,205
9,744
2,779
46,176
66,904
459,844
132,764
25,225
617,833
50,085
236,099
315,000
232,387
731,840
1,565,411
133,5 17
397,161
347,498
2,0 18,398
5,508
2,902,082
2,983,994
9,332,498
Purpose
Overdrawn Cash (A)
Overdrawn Cash (A)
Overdrawn Cash (D)
Overdrawn Cash (B)
Overdrawn Cash (B)
Overdrawn Cash (B)
Overdrawn Cash (B)
Overdrawn Cash (D)
Overdrawn Cash (B)
Overdrawn Cash (B)
Overdrawn Cash (B)
Overdrawn Cash (B)
Overdrawn Cash (B)
Overdrawn Cash (B)
Overdrawn Cash (C)
Overdrawn Cash (C)
Overdrawn Cash (C)
Overdrawn Cash (C)
Overdrawn Cash (C)
Overdrawn Cash (C)
City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 4 - Interfund Transactions (Continued)
B. Transfers In/Out
Transfers in and out for the year ended June 30, 2021, were as follows:

Transfers In
General Capital Projects Fund
Measure H Debt Service Fund
General Liability Internal Service Ftmd
General Liability Internal Service Fund
General Liability Internal Service Fund
Business Improvement District Special Revenue Fund
Other Operating Grants Special Revenue Fund
Local Housing Programs Special Revenue Fund
LT A Measure D Special Revenue Fund
Note 5 - Capital Assets
A. Governmental Activities
Transfers Out
General Fund
General Fund
Medical Retirees Internal Service Fund
Workers' Compensation Internal Service Fund
Unemployment Insurance Internal Service Fund
Solid Waste Special Revenue Fund
TOA Special Revenue Fund
Successor Housing Special Revenue Fund
Capital Grants Capital Projects Fund
Amount
$ 523,000
997,154
Subtotal 1,520,154
118,000
200,000
65,000
Subtotal 383,000
3,142
23,336
67,000
355,622
Total $ 2,352,254
The following is a summary of changes in capital assets for the governmental activities:

Balance
July I , 2020 Additions Deletions Transfers
Non-depreciable Assets:

Land $ 5,511,772 $ $ $
Construction in progress 22,990,758 10,275,292 (21,379,288) Total non-depreciable assets 28,502,530 10,275,292 (21 ,379,288) Depreciable Assets:

Building and improvements 21,793,161 121 ,894 64,250
Machinery and equipment 11,006,100 371,074
Infrastructure 107,201,495 21,315,038
Total depreciable assets, at cost 140,000,756 492,968 21,379,288 Less accumulated depreciation:

Building and improvements (11,602,716) (453,940)
Machinery and equipment (8,721 ,950) (472,355)
Infrastructure (78,897,002) (2, 746,600)
Total accumulated depreciation (99,221,668) (3,672,895) Total depreciable assets, net 40,779,088 (3,179,927) 21 ,379,288 Total governmental activities $ 69,281 ,618 $ 7,095,365 $ $ 63 Purpose
Capital projects
Debt Service
Operations
Operations
Operations
Operations
Operations
Operations
Capital projects
Balance
June 30, 2021
$ 5,5 I 1,772
I 1,886,762
17,398,534
21 ,979,305
11 ,377,174
128,516,533
161,873,012
(12,056,656)
(9' 194,3 05)
(81,643,602)
(102,894,563)
58,978,449
$ 76,376,983
City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 5 - Capital Assets (Continued)
A. Govemmental Activities (Continued)
Governmental activities depreciation expenses for capital assets for the year ended June 30, 2021 are as follows:

B. Business-Type Activities
General government
Public safety
Public works
Culture and recreation
P Janning and building
Housing
Total depreciation expense
$
$
153,919
349,067
3,021,965
145,675
2,169
100
3,672,895
The following is a summary of changes in capital assets for business-type activities:

Balance
July l, 2020 Additions Deletions
Non-depreciable Assets:

Land $ 281 ,615 $ $
Construction in progress 2,461,537 2,484,963
Total non-depreciable assets 2,743,152 2,484,963
Depreciable Assets:

Building and improvements 37,017,197
Machinery and equipment 20,180,311 495,159 (174,255)
Infrastructure 23,333,475
Total depreciable assets, at cost 80,530,983 495,159 (174,255) Less accumulated depreciation:

Building and improvements (17,058,148) (642,817)
Machinery and equipment (9, 170,807) (I , 133,822) 58,960 Infrastructure (8,052,234) (523,987)
Total accumulated depreciation (34,281,189) (2,300,626) 58,960 Total depreciable assets, net 46,249,794 ( 1,805,467) (115,295) Total business-type activities $ 48,992,946 $ 679,496 $ (115,295) Adjustments/ Balance
Transfers June 30, 2021
$ $ 281,615
4,946,500
5,228, 115
37,017,197
20,501,215
23,333,475
80,851 ,887
(17,700,965)
(I 0,245,669)
(8,576,221)
(36,522,855)
44,329,032
$ $ 49,557,147
Depreciation expense for capital assets of the business-type activities for the year ended June 30, 2021 was as follows:

Water $ 1,535,787
Wastewater 505,292
Airport 259,547
Total depreciation expense $ 2,300,626
64 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 5 - Capital Assets (Continued)
C. Fiducimy Funds
The following is a summary of changes in capital assets for the Fiduciary Funds:

Balance
July 1, 2020 Additions Deletions
Non-depreciable Assets:

Land $ 1,106,663 $ $
Total non-depreciable assets 1,106,663
Depreciable Assets:

Buildingand improvements 2,293,864
Total depreciable assets, at cost 2,293,864
Less accumulated depreciation:

Building and improvements (584,936) (45,877)
Total accumulated depreciation (584,936) (45,877)
Total dep reciable assets, net 1,708,928 (45,877)
Total fiduciary funds $ 2,815,591 $ (45,877) $
Balance
June 30, 2021
$ 1,106,663
1,106,663
2,293,864
2,293,864
(630,813)
(630,813)
1,663,051
$ 2,769,714
Depreciation expense for capital assets of the fiduciary funds for the year ended June 30, 2021 was $45,877.

Note 6-Long-Term Debt
A. Governmental Activities
Summary of changes in long-term liabilities for the governmental activities for the year ended June 30, 2021 is as follows:

Classification
Balance Debt Debt Balance Due in Due in more
July I, 2020 Issued Retired June 30, 202 1 One Year than One Year Governmental Activities:

Publicly Offered:

LTA Sales Tax Revenue Bonds, Series 20 12B $ 10,600,000 $ $ (710,000) $ 9,890,000 $ 735,000 $ 9, 155,000 Bond premium 17, 106 (8,553) 8,553 8,553
Measure H Lease Revenue Bonds 7,755,000 (635,000) 7, 120,000 660,000 6,460,000 Bond premium 545,963 (60,662) 485,301 485,30 1
LT A Sales Tax Revenue Bonds, Series 20 I 8A 11,915,000 (165,000) 11 ,750,000 165,000 11 ,585,000 Bond premium 676,986 (37,610) 639,376 639,376
Privately Offered:

Tax sharing agreement 46,000 46,000 46,000
Cap ital lease obligp.tions 158,35 1 (33,600) 124,75 1 36,464 88,287 JPIA payable internal service funds:

Workers compensation 363,956 (363,956)
General liability 479, 177 (479,177)
Total governmental activities $ 32,557,539 $ $ (2,493,558) $ 30,063,981 $ 1,642,464 $ 28,42 1,517 65 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 6 - Long-Term Debt (Continued)
A. Govemmental Activities (Continued)
LTA Sales Tax Revenue Bonds, Series 2012B
On May 1, 2012, the Imperial County Local Transportation Authority issued the 2012 LTA Sales Tax Revenue Bonds on behalf of the City in the amount of $15,410,000. The Bonds are being issued to (i) finance certain costs associated with certain transportation projects, (ii) fund a reserve for the Bonds, and (iii) pay certain costs of issuing the Bonds. The Bonds are payable from and secured by the pledged allocable Measure D sales tax revenues of the City.

The issue consists of serial bonds in the amount $15,410,000 payable annually on June 1 of each year, commencing on June 1, 2013 and maturing in 2032 with interest rates ranging from 3% to 4% per annum. Interest payments are due on June 1 and December 1 of each year until the bonds are paid off. At June 30, 2021, the outstanding balance of the bonds was $9,890,000. Total principal and interest remaining on the bond is $12,426,950, payable through 2032.

The annual debt service requirements for the bonds are as follows:

Year Ending
June 30, Principal Interest Total
2022 $ 735,000 $ 395,800 .$ 1, 130,800
2023 755,000 373,750 1, 128,750
2024 795,000 336,000 1, 131 ,000
2025 825,000 304,200 1, 129,200
2026 860,000 271,200 1, 131,200
2027-2031 4,835,000 812,600 5,647,600
2032 1,085,000 43,400 1, 128,400
Total $ 9,890,000 $ 2,536,950 $ 12,426,950
Measure H Lease Revenue Bonds
On April 1, 2014, Calexico Financing Authority (the "Authority") issued its Measure "H" Sales Tax/Lease Revenue Bonds, Issue of2014 (the "Bonds") pursuant to a trust agreement, dated as of June 1, 2014 (the "Trust Agreement"), by and among the City of Calexico (the "City"), the Authority and U.S. Bank National Association, as trustee (the "Trustee"). Proceeds of the Bonds are being used to (i) finance a portion of the costs ofa new fire station headquarters and various park and recreation improvements; (ii) fund a deposit to the Reserve Account in an amount equal to the Reserve Requirement; and (iii) pay costs of issuance of the Bonds. The Bonds are payable solely from, and secured by, the trust estate and certain funds and accounts held under the Trust Agreement.

The issue consisted of serial bonds in the amount $11,200,000 payable annually on June 1 of each year, commencing on April 1, 2013 and maturing in 2030 with interest rates ranging from 3% to 4% per annum. Interest payments are due on April 1 and October 1 of each year until the bonds are paid off. At June 30, 2021, the outstanding balance of the bonds was $7,120,000. Total principal and interest remaining on the bond is $8,967,500, payable through 2030. 66 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 6 - Long-Term Debt (Continued)
A. Govemmental Activities (Continued)
Measure H Lease Revenue Bonds (Continued)
The annual debt service requirements for the bonds are as follows:

Year Ending
June 30, Principal Interest
2022 $ 660,000 $ 335,400
2023 685,000 309,000
2024 715,000 281 ,600
2025 745,000 253,000
2026 780,000 215,750
2027-2030 3,535,000 452,750
Total $ 7,120,000 $ 1,847,500
LTA Sales Tax Revenue Bonds, Series 2018A
Total
$ 995,400
994,000
996,600
998,000
995,750
3,987,750
$ 8,967,500
In September 2018, the Imperial County Local Transpo1tation Authority issued LTA Sales Tax Revenue Bonds (Bonds) on behalfofthe City in the amount of$12,375,000. The Bonds were issued to finance certain transpo1tation projects, fund a reserve for the Bonds, and to pay certain cost of issuing the Bonds. The Bonds are payable from and secured by a pledge of Measure D sales tax revenues of the City.

The issue consists of serial bonds in the amount $12,375,000 payable annually on June 1 of each year, commencing on June 1, 2019 and maturing in 2038 with interest rates ranging from 3.25% to 5% per annum. Interest payments are due on June 1 and December 1 of each year until the bonds are paid off. At June 30, 2021, the outstanding balance of the bonds was $11,750,000. Total principal and interest remaining on the bond is $18,001,050, payable through 2038.

The annual debt service requirements for the bonds are as follows:

Year Ending
June 30, Principal Interest
2022 $ 165,000 $ 492,050
2023 175,000 485,450
2024 185,000 476,700
2025 195,000 467,450
2026 200,000 457,700
2027-2031 1,175,000 2,126,750
2032-2036 6,280,000 1,541,150
2037-2038 3,375,000 203,800
Total $ l l,750,000 $ 6,251,050
Tax Sharing Agreement - Imperial County
Total
$ 657,050
660,450
661,700
662,450
657,700
3,301 ,750
7,821 , 150
3,578,800
$ 18,001 ,050
In June 2003, the City entered into an agreement with Local Agency Formation Commission (LAFCO) in order to offset the "negative fiscal impacts," as determined by LAFCO, to the County as a result of the approval of the Calexico Annexation No. CX 3-01 . The City agreed to pay the County $291,000 interest free, payable solely from the prope1ty tax revenues upon annexation of the area. At June 30, 2021, the outstanding balance was $46,000. The balance was paid in full subsequent to June 30, 2021.
67 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 6- Long-Term Debt (Continued)
A. Govemmental Activities (Continued)
Capital Leases
The City has entered into several lease agreements for the financing of vehicles. The lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of future minimum lease payments as of the date of inception.

The annual debt service requirements for the capital leases payable outstanding at June 30, 2021 are as follows:

Year Ending
June 30, Principal
2022 $ 36,464
2023 39,574
2024 48,713
Total $ 124,751
Interest
$ 7,893
4,782
1,404
$ 14,079
Total
$ 44,357
44,356
50,117
$ 138,830
The leased assets are included in capital assets and are summarized by major asset class below:

Vehicles
Less: accumulated depreciation
Total
JPIA Payable
$
$
194,198
(89,729)
104,469
The City was a member of the California Joint Powers Insurance Authority (JPIA) through December 31, 2015. As of January 1, 2016, the City became self-insured for claims incurred after that date. JPIA continues to administer and settle claims incurred by the City prior to December 31, 2015.

The JPIA is composed of approximately 118 California public entities and is organized under a joint powers agreement pursuant to California Government Code §6500 et seq. The purpose of the JPIA is to arrange and administer programs for the pooling of self-insured losses, to purchase excess insurance or reinsurance, and to arrange for group purchased insurance for property and other lines of coverage.

Each member pays an annual contribution to cover estimated losses for the coverage period. After the close of the coverage period, outstanding claims are valued. A retrospective charge is computed annually thereafter until all claims incurred during the coverage period are closed on a pool-wide basis. The City's liability to the JPIA for retrospective charges is recorded in its respective Workers Compensation and General Liability Internal Service Funds. As of June 30, 2021, the City's JPIA obligation has been paid and retired. 68 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 6 - Long-Term Debt (Continued)
B. Business-Type Activities
Summary of changes in Jong-term liabilities for the business-type activities for the year ended June 30, 2021 is as follows:

Classification
Balance Debt Debt Balance Due in Due in more
July 1, 2020 Issued Retired June 30, 2021 One Year than One Year Business-Type Activities:

Publicly Offered:

Lease revenue bonds, Series 2007 $ I 1,585,000 $ - $ ( 11 ,585,000) $ $ $ Water Revenue Bonds, Series 2020A 16,255,000 (425,000) 15,830,000 295,000 15,535,000 Bond premium 1,432,907 (47,764) 1,385,143 1,385, 143
Wastewater Revenue Bonds, Series 2020A 22,715,000 (580,000) 22, 135,000 410,000 2 1,725,000 Bond premium 2,001,440 (66,71 5) 1,934,725 1,934,725
Privately Offered:

Cap it al lease obligitions {privately offered) 298,209 148,376 {177,658) 268,927 65,998 202,929 Total business-type acth1ties $ 11 ,883,209 $ 42,552, 723 $(12,882,137) $ 4 1,553,795 $ 770,998 $ 40,782,797 Lease Revenue Bonds - 2007
On January 1, 2007, the City, through the former RDA issued $14,030,000 in Water System Lease Revenue Bonds of 2007. Proceeds from the sale of the bonds were used to provide funds to finance certain capital improvements to the City's water system, fund a reserve account for the bonds, fund capitalized interest, and pay ce1tain costs of issuance of the bonds. The bonds were payable solely from certain lease payments to be made by the City to the former RDA pursuant to a lease agreement by and between the City and the former RDA. The lease payments were special limited obligations of the City payable solely from and secured by a pledge of and first lien on water revenues.

The Redevelopment Obligation Retirement Fund (Successor Agency) was created to serve as a custodian for the assets and to wind down the affairs of the Redevelopment Agency (RDA) on February 1, 2012.

The City had pledged a p01tion of future lease revenues from the former RDA to repay the 2007 Lease Revenue Bonds. At June 30, 2021, the outstanding balance of the bonds was refunded through the issuance ofthe 2021 Water Refunding Revenue Bonds, Series A.

Water and Wastewater 2020 Refunding Revenue Bonds
In July 2020, the Calexico Financing Authority (the "Authority") issued its Water Revenue Bonds Series 2020A (the "Water Bonds") in . the principal amount of $16,255,000 and Wastewater Revenue Bonds Series 2020A (the "Wastewater Bonds" - collectively "the Bonds") in the principal amount of$22,715,000 under an Indenture of Trust, dated as of July 1, 2020. The Bonds mature annually on November 1 beginning in 2020 and bear interest at rates ranging from 3% to 4% per annum. Interest payments are due on May 1 and November 1 of each year until the bonds are paid off. Proceeds of the Water Bonds will be used to (i) refund the Community Redevelopment Agency of the City of Calexico Water System Lease Revenue Bonds Issue of2007, (ii) to finance ce1tain improvement to the water system, (iii) to purchase a municipal bond insurance policy and a debt service surety for the Water Bonds, and (iv) to pay costs of issuance of the Water Bonds. Proceeds of the Wastewater Bonds will be used to (i) finance ce1tain improvements to the wastewater system, (ii) to purchase a municipal bond insurance policy and a debt service surety for the Wastewater Bonds, and (iii) to pay costs of issuance of the Wastewater Bonds. 69 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 6 - Long-Term Debt (Continued)
B. Business-Type Activities (Continued)
Water and Wastewater 2020 Refunding Revenue Bonds (Continued) The issues consist of serial bonds maturing from 2020 to 2050 in combined annual installments of $1,005,000 to $1,940,000. The bonds carry interest rates ranging from 3.0% to 4.0% and mature in 2050. Interest payments are due on May 1 and November I of each year until the bonds are paid off.

The aggregate debt service payments of the new debt are $13,225,608 less than the old debt. The issuance of the new water debt and the refunding of the old debt resulted in an economic gain (the difference between the net present value of the old debt and new debt service payments) of approximately $2,005,968.

The annual debt service requirements for the bonds are as follows:

Water Revenue Bonds, Series 2020A
Year Ending
June 30, Principal Interest
2022 $ 295,000 $ 528,150
2023 305,000 516,150
2024 315,000 503,750
2025 330,000 490,850
2026 345,000 477,350
2027-2031 1,950,000 2,163,250
2032-2036 2,375,000 1,732,750
2037-2041 2,825,000 1,280,475
2042-2046 3,280,000 823,200
2047-2051 3,810,000 292,800
Total $ 15,830,000 $ 8,808,725
Wastewater Revenue Bonds, Series 2020A
Year Ending
June 30, Principal Interest
2022 $ 410,000 $ 738,400
2023 425,000 721,700
2024 445,000 704,300
2025 460,000 686,200
2026 480,000 667,400
2027-2031 2,720,000 3,026,000
2032-2036 3,315,000 2,424,500
2037-2041 3,955,000 1,792,575
2042-2046 4,590,000 1,152,750
2047-2051 5,335,000 409,575
Total $ 22,135,000 $ 12,323,400
70 $
$
$
$
Total
823, 150
821,150
818,750
820,850
822,350
4,113,250
4,107,750
4,105,475
4, 103,200
4,102,800
24,638,725
Total
1,148,400
1,146,700
1,149,300
1, 146,200
1, 147,400
5,746,000
5,739,500
5,747,575
5,742,750
5,744,575
34,458,400
City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 6 - Long-Term Debt (Continued)
B. Business-Type Activities (Continued)
Capital Leases
The City has entered into several lease agreements for the financing of water and wastewater vehicles. The lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of future minimum lease payments as of the date of inception.

The annual debt service requirements for the capital leases payable outstanding at June 30, 2021 are as follows:

Year Ending
June 30, Principal
2022 $ 65,998
2023 106,901
2022 22,263
2024 23,907
2025 49,858
Total $ 268,927
Interest
$ I 1,780
6,084
3,225
1,581
139
$ 22,809
Total
$ 77,778
112,985
25,488
25,488
49,997
$ 291,736
The leased assets are included in capital assets and are summarized by major asset class below:

C. Fiducimy Funds
Vehicles
Less: accumulated depreciation
Total
$
$
439,284
(203,446)
235,838
Summary of changes in long-term liabilities for the fiduciary funds for the year ended June 30, 2021 is as follows:

Balance
July I, 2020
Fiduciary Funds:

Publicly Offered:

Tax Allocation Bonds -2011 School District $ 1,810,000 $ Bond discount (108,741)
2014 Tax Allocation Refunding Bonds
Bond premium
2020 Tax Allocation Refunding Bonds
Total Tax Allocation Bonds
9,380,000
1,079,449
11,085,000
$23,245,708 $
Debt
Refunding
71 $
Debt
Retired
8,365
(1 ,310,000)
(119,937)
(130,000)
$ (1 ,551,572)
Classification
Balance Due in Due in more
June 30, 2021 One Year than One Year
$ 1,810,000 $ $ 1,810,000
(100,376) (I 00,376)
8,070,000 1,355,000 6,715,000
959,512 959,512
10,955,000 210,000 10,745,000
$21 ,694, 136 $ 1,565,000 $20,129,136
City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 6 - Long-Term Debt (Continued)
C. Fiduciary Funds (Continued)
2011 Tax Allocation Bonds - School District
On May 19, 2011, the Agency issued its Merged Central Business District and Residential Redevelopment Project Area Tax Allocation Bonds (School District), Issue of 2011 (the "2011 CUSD T ABs") for the purpose of financing the construction of ce1tain capital improvements (the "Facilities") of the Calexico Unified School District (the "CUSD"). The 2011 CUSD TABs were issued at the request of the CUSD. The 2011 CUSD TABs are secured by certain tax increment pass-tlu·ough revenues (the "CUSD Pass-through Revenues") pursuant to Section 3 of the each of the following agreements (collectively, the "Antecedent Agreements"):

1. First Amended and Restated Public Improvements Agreement dated March 16, 1993;

2. Memorandum of Understanding dated October 20, 1993; and

3. Public Improvements Agreement dated December 20, 1993.

Pursuant to the Antecedent Agreements, the purpose of the CUSD Pass-through Revenues was to finance certain capital projects benefitting the CUSD. To the extent that any of the CUSD Pass-through Revenues were not so used, such unused moneys were to be transferred to the CUSD. Additionally, the CUSD previously requested and authorized the former RDA to use a portion of the CUSD Pass-through Revenues as security for and payment of the debt service for ce1tain prior bonds (the "Prior Bonds"), the proceeds of which were used to finance the construction of ce1tain capital improvements benefiting the CUSD.

The net proceeds from the 2011 CUSD T ABs were intended to be used to construct the Facilities benefiting the CUSD and the CUSD Pass-through revenues were committed as security for and payment of the debt service for 2011 CUSD TABs.

The issue consists of serial bonds in the amount $1,815,000 payable annually on August 1 of each year, commencing on August 1, 2011 and maturing in 2034 with interest rates ranging from 6.40% to 6.60% per annum. Interest payments are due on August 1 and February 1 of each year until the bonds are paid off. The outstanding balance of the bonds was transferred to the Successor Agency on January 31, 2012 due to the dissolution of the Agency. At June 30, 2018, the outstanding balance of the bonds was $1 ,810,000. Total principal and interest remaining on the bond is $2,901,980 payable through 2034.

The annual debt service requirements for the 2011 Tax Allocation Bonds - School District at June 30, 2021, are as follows:

Year Ending
June 30, Principal Interest Total
2022 $ $ 118,740 $ 118,740
2023 5,000 118,580 123,580
2024 118,420 118,420
2025 118,420 118,420
2026 110,000 114,900 224,900
2027-2031 925,000 436,590 1,361 ,590
2032-2034 770,000 66,330 836,330
Total $ 1,810,000 $ 1,091,980 $ 2,901,980
72 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 6 - Long-Term Debt (Continued)
C. Fiduciary Funds (Continued)
2014 Tax Allocation Refunding Bonds
On August 1, 2014, the Agency issued the 2014 Tax Allocation Refunding Bonds in the amount of $15,395,000.

The Bonds were issued to refinance previously issued bonds: (i) $16, 120,000 original principal amount of Merged Central Business District and Residential Redevelopment Project Area Tax Allocation Refunding Bonds Issue of 2003A, outstanding principal refunded in the amount of $11,335,000; and (ii) $8,600,000 original principal amount of Merged Central Business District and Residential Redevelopment Project Area Tax Allocation Bonds, Issue of 2003C, outstanding principal refunded in the amount of$6,040,000.

The issue consists of serial bonds in the amount $15,395,000 payable annually on August 1 of each year, commencing on August 1, 2015 and maturing in 2028 with interest rates ranging from 2.00% to 5.00% per annum.

Interest payments are due on August 1 and February 1 of each year until the bonds are paid off. At June 30, 2021 , the outstanding balance of the bonds was $8,070,000. Total principal and interest remaining on the bond is $9,346,500 payable through 2029.

The annual debt service requirements for the 2014 Tax Allocation Refunding Bonds at June 30, 2021, are as follows:

Year Ending
June 30,
2022
2023
2024
2025
2026
2027-2029
Total
2020 Tax Allocation Refunding Bonds
Principal
$ 1,355,000
1,425,000
1,495,000
1,570,000
520,000
1,705,000
$ 8,070,000
Interest
$ 369,625
300, 125
227,125
150,500
98,250
130,875
Total
$ 1,724,625
1,725,125
1,722, 125
1,720,500
618,250
1,835,875
$ 1,276,500 $ 9,346,500
In January 2020 the Successor Agency issued $11,085,000 of Subordinate Tax Allocation Refunding Bonds. The bonds are special obligations of the Successor Agency payable from and secured by a pledge of the Successor Agency's tax revenues. Proceeds from the bonds, along with funds on hand, were used to refinance the Agency's outstanding bonds from series previously issued in 2000 ($515,000), 2006 ($9,465,000), and 2011 ($7,120,000). The issue consists of serial bonds maturing from 2021to2034 in annual installments of$130,000 to $1,680,000. The bonds carry interest rates ranging from 1.9% to 3.2% and mature in 2034. The aggregate debt service payments of the new debt are $13,233,255 less than the old debt. The issuance of the new debt and the refunding of the old debt resulted in an economic gain (the difference between the net present value of the old debt and new debt service payments) of approximately $2,609 ,861.

The annual debt service requirements for the 2020 Tax Allocation Refunding Bonds at June 30, 2021, are as follows:

Year Ending
June 30, Principal Interest Total
2022 $ 210,000 $ 313,134 $ 523,134
2023 210,000 309,037 519,037
2024 215,000 304,667 519,667
2025 220,000 299,928 519,928
2026 1,420,000 294,840 1,714,840
2027-2031 7,880,000 867,050 8,747,050
2032-2034 800,000 53,166 853,166
Total $ 10,955,000 $ 2,441,822 $ 13,396,822
73 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 6 - Long-Term Debt (Continued)
C. Fiducimy Funds (Continued)
Pledged Revenues
The Successor Agency has pledged tax revenues to the repayment of the former Calexico Redevelopment Agency's debts transferred to it on February 1, 2012 through the final maturity of the Bonds, or early retirement of the Bonds, whichever comes first.

Tax revenues consist of propetiy tax revenues allocated to the Redevelopment Prope1iy Tax Trust Fund (RPTTF) for the Successor Agency that is maintained by the County of Imperial Auditor and Controller. The amounts so allocated are those that would have been allocated to the RDA had the RDA not been dissolved. The Auditor and Controller (A&C) then distributes RPTTF revenues to the Successor Agency based on Recognized Obligation Payment Schedules (ROPS) as approved by the California State Department of Finance (DOF) and after deducting amounts for A&C administrative costs and amounts required to be paid under tax-sharing agreements unless the payment of such amounts has been subordinated to payment of debt services on the Bonds. Each ROPS covers a twelve-month period and includes the applicable debt service payments on the Bonds.

Prope1iy tax revenue allocated to the RPTTF for the Successor Agency totaled $7, 144,009 in fiscal year 2021. Total debt service of all Tax Allocation Bonds paid was $2,309, 151, 32% of the RPTTF revenue available for distribution to the Successor Agency.

D. Conduit Debt
Community Facilities District No. 2005-1 - Special Assessment Tax Bonds On September 1, 2005, the City issued special assessment tax bonds under the State Improvement Acts of 1911 and 1915 through the Community Facilities District No. 2005-1 (Hemihstone) of the City of Calexico ("District"), which was established by the City pursuant to a bond indenture dated July 1, 2006. The bonds were issued to finance cetiain public facilities and capital impact fees relating to a residential development within the District, fund an escrow account, fund a reserve account for the bonds, fund 18 months of capitalized interest on the bonds, and pay the cost of issuance of the bonds. These bonds are payable only from special assessment collections from the property owners. The City is not liable for repayment in any manner.

The City is only acting as an agent for the propetiy owners and bondholders in collecting and applying the special assessments toward bond debt service. The bonds are, therefore, not repotied as a liability in the accompanying basic financial statements. The special assessment tax bonds totaling $12,450,000 at June 30, 2021 were held by the District.

The development phases within the District have not been completed and sufficient District levies have not been collected to fully fund the District's debt service requirements. As of June 30, 2021, the scheduled principal payments due September 1, 2016, 2017, 2018, 2019, and 2020 have not been paid. The bond reserve account held by the trustee was $137,432, which is less than the required balance of $1,016,560. City administrators, community facilities district consultants, the City Attorney, new property owners, and trustee attorneys are currently working on a financial plan to auction undeveloped propetiy to provide a final solution to this issue. 74 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 6 - Long-Term Debt (Continued)
D. Conduit Debt (Continued)
Community Facilities District No. 2013-1 - Special Tax Bonds On February 1, 2014, the City issued special assessment tax bonds under the State Improvement Acts of 1911 and 1915 through the Communities Facilities District No. 2013-1 (Gran Plaza) of the City of Calexico ("District"), which was established by the City pursuant to a bond indenture dated February 1, 2014. Proceeds of the Bonds were used to (i) finance certain public facilities relating to an outlet shopping center within the District; (ii) fund a debt service reserve account; (iii) fund capitalized interest; and (iv) pay costs of issuance of the Bonds. These bonds are payable from special assessment collections from the prope1ty owner and from certain payments contributed to the District by the City pursuant to an agreement between the City and Prope1ty owner dated July 2, 2013. The City acts as an agent for the property owners and bondholders in collecting special assessments from the property owner and its own contributions on behalf of the prope1ty owner. The District applies such collections toward bond debt service.

The bonds are not reported as a liability of the City in the accompanying basic financial statements. The special assessment tax bonds totaling $6,565,000 at June 30, 2021 were held by the District.

Note 7 - Compensated Absences
A. Governmental Activities
The City's liability for vested and unpaid compensated absences (accrued vacation and sick pay) in the governmental activities has been accrued and amounts to $1,569,284 at June 30, 2021.

Classification
Balance Balance Due Within Due in More
July 1, 2020 Additions Deletions June 30, 2021 One Year Than One Year Governmental Activities:

Compensated absences $ 1,415,843 $ 249,945 $ (96,504) $ 1,569,284 $ 102,149 $ 1,467,135 ~~~~~ ~~~~~ Total governmental activities $ 1,415,843 $ 249,945 $ (96,504) $ 1,569,284 $ 102,149 $ 1,467, 135 B. Business-Type Activities
In proprietary funds, the liability for vested and unpaid compensated absences (accrued vacation and sick pay) is reported in the funds as the benefits vest and is earned. The compensated absences accrued in the proprietary funds amount to $371,487 at June 30, 2021.

Classification
Balance Balance Due Within Due in More
July 1, 2020 Additions Deletions June 30, 2021 One Year Than One Year Business-Type Activities:

Compensated absences $ 349,489 $ 42,763 $ (20,765) $ 371 ,487 $ 10,141 $ 361 ,346 Total business-type activities $ 349,4 89 $ 42,763 $ (20,765) $ 371,487 $ 10, 141 $ 361,346 75 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 8 - Risk Management
A.

B.

Summmy
Changes in the claims liability amounts were as follows:

Workers' Com12ensation
Current Year
Beginning of Claims and Balance at
Fiscal Year Changes in Claim Fiscal Year
Liability Estimates Payments End
2018-2019 $ 1,566,000 $ 603,262 $ (569,262) $ 1,600,000 2019-2020 1,600,000 895,375 (556,375) 1,939,000
2020-2021 1,939,000 565,046 (432,046) 2,072,000
General Liability
Current Year
Beginning of Claims and Balance at
Fiscal Year Changes in Claim Fiscal Year
Liability Estimates Payments End
2018-2019 $ 386,000 $ 214,914 $ (36,914) $ 564,000
2019-2020 564,000 225,130 (31,562) 757,568
2020-2021 757,568 830,828 (29,332) 1,559,064
Public Risk In11ovatio11, Solutions, and Management - Excess Insurance Authority The City is a member of Public Risk Innovation, Solutions, and Management- Excess Insurance Authority (PRISM) The Authority is comprised of 55 California counties and currently consists of262 public agencies, which includes municipalities, school districts, special districts and other Joint Powers Authorities (JPA). PRISM was formed as a Joint Powers Authority in 1979, pursuant to the California Government Code. The purpose of the Authority is to arrange, provide and administer programs of insurance for the pooling of self-insured losses and to purchase excess insurance coverage.

The Board of Directors is comprised of 62 members, one representative from each member county and seven members elected by the public entity membership.

General Liability Insurance
Annual deposits are paid by member cities and are adjusted retroactively to cover costs. Each member city has a specific self-insured retention ("SIR") level. The City has a SIR level of $100,000 and pays 100% of all losses incurred under $100,000. The City does not share or pay for losses of other cities under $100,000. Losses of$100,000 to $5,000,000 are prorated among all patticipating cities on a payroll basis. Losses in excess of $5,000,000 are covered by excess insurance purchased by the patticipating cities, as a patt of the pool, to a limit of $10,000,000.

This cost is also prorated on a payroll basis. The City purchased an optional excess coverage, which covers up to $20,000,000, and catastrophic coverage up to $50,000,000. 76 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 8 - Risk Management (Continued)
B. Public Risk Innovation, Solutions, and Management- Excess Insurance Authority (Continued) Workers' Compensation
The City has a SIR of $125,000 per claim and additional coverage above its SIR with PRISM to $5 million per claim; there is an additional $45 million of reinsurance above PRISM coverage bringing the total coverage to over $50 million per claim. The PRISM is ranked as the second largest public entity risk pool and the largest property and casualty pool in the nation.

During the past three fiscal (claims) years none of the above programs of protection have had settlements or judgments that exceeded pooled or insured coverage. There have been no significant reductions in pooled or insured liability coverage in the prior year.

The latest financial information of the Public Risk Innovation, Solutions, and Management - Excess Insurance Authority for fiscal year ended June 30, 2021 , is as follows:

Total assets $ 1,006,132,845
Total deferred outflows $ 2,167,314
Total liabilities $ 820,969,455
Total deferred inflows $ 976,070
Total equities $ 186,354,634
Total revenues $1,291,008,268
Total expenses $1,278,916,616
Revenues over expenses $ 12,091 ,652
77 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 9 - Pension Plans
A. Summary
Govemmental Business-Type
Activities Activities
Deferred Outflows of Resources:

Pension contribution made after measurement date:

CalPERS Miscellaneous $ 769,852 $ 544,004
CalPERS Safety 1,750,135
Total pension contribution made after measurement date 2,519,987 544,004 Projected earning; on pension plan investments in excess of actual earning;:

CalPERS Miscellaneous 242,823 171,589
CalPERS Safety 354,463
Total projected earning; on pension plan investments in excess of actual earning; 597,286 171 ,589
Adjustment due to difference in proportions:

Ca!PERS Miscellaneous 331 ,488 234,243
CalPERS Safety 237,715
Total adjustment due to difference in proportions 569,203 234,243 Difference between expected and actual experience:

CalPERS Miscellaneous 421 ,234 297,660
Ca!PERS Safety 1,264,681
Total difference between expected and actual experience 1,685,915 297,660 Total deferred outflows of resources:

CalPERS Miscellaneous 1,765,397 1,247,496
CalPERS Safety 3,606,994
Total deferred outflows of resources $ 5,372,391 $ 1,247,496 78 Total
$ 1,313,856
1,750,135
3,063,991
414,412
354,463
768,875
565,731
237,715
803,446
718,894
1,264,681
1,983,575
3,012,893
3,606,994
$ 6,619,887
City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 9 -Pension Plans (Continued)
A. Summmy (Continued)
Governmental Business-Type
Activities Activities Total
Net Pension Liabilities:

CalPERS Miscellaneous $ 8, 174,068 $ 5,776, 111 $ 13,950, 179 CalPERS Safety 16,309,009 16,309,009
Total net pension Liabilities $ 24,483,077 $ 5,776,111 $ 30,259, 188 Deferred Inflows of Resources:

Change in assumption
CalP ERS Miscellaneous $ 58,300 $ 41 , 198 $ 99,498
CalPERS Safety 54,326 54,326
Total change in assumption 112,626 41,198 153,824
Employer contributions in excess of proportionate share of contribution:

Ca!PERS Miscellaneous 626,413 442,647 1,069,060
CalPERS Safety 758,366 758,366
Total employer contributions in excess of proportionate share of contribution 1,384,779 442,647 1,827,426
Total deferred inflows of resources:

CalPERS Miscellaneous 684,713 483,845 1, 168,558
CalPERS Safety 812,692 812,692
Total deterred intlows of resources $ 1,497,405 $ 483 ,845 $ 1,981,250 Pension Expense:

CalPERS Miscellaneous $ 1, 127,103 $ 796,453 $ 1,923,556 CalPERS Safety 2,663,046 2,663,046
Tot al net pens ion expense $ 3,790,149 $ 796,453 $ 4,586,602 B. General Informatio11 about Pension Plans
Plan Description
The City contributes to the California Public Employees' Retirement System ("CalPERS"), a cost-sharing multipleemployer defined benefit pension plan. CalPERS provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. CalPERS acts as a common investment and administrative agent for pmiicipating public entities within the State of California. Benefit provisions and all other requirements are established by state statute and City ordinance. Copies of the CalPERS annual financial report may be obtained from their executive office located at 400 P Street, Sacramento, California 95814. 79 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 9 - Pension Plans (Continued)
B. General Information about Pension Plans (Continued)
Emplovees Covered by Benefit Terms
At June 30, 2020, the measurement date, the following employees were covered by the benefit terms:

Active employees
TransfeITed and terminated employees
Retired employees and beneficiaries
Total
Benefits Provided
Miscellaneous
61 103
130
294
Miscellaneous
PEP RA
44 13
57 Safety
33 81
89 203
S afcty
PEPRA Police
10 10
20 Safety
PEPRAFirc
7 8
CalPERS provide retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. Classic and PEPRA Safety CalPERS member becomes eligible for service retirement upon attainment of age 55 with at least 5 years of credited service. PEPRA miscellaneous members become eligible for service retirement upon attainment of age 62 with at least five years of service. The service retirement benefit is a monthly allowance equal to the product of the benefit factor, years of service, and final compensation. The final compensation is the monthly average of the member's highest 36 full-time equivalent monthly pay.

Following are the benefit provisions for each plan:

Miscellaneous Safety Safety
Miscellaneous PEP RA Safety PEPRA Police PEPRAFirc
Benefit formula 2.7%@55 2.0%@62 3.0%@50 2.7%@57 2.7%@57 Benefit vesting schedule 5 years service 5 years service 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life monthly for life monthly for life Retirement age 55 62 50 50-57 50-57
M ontWy benefits, as a% of
eligible compensation 2.7% 2.0% 3.0% 2.7% 2.7%
Required employee contribution rate 8.00% 6.75% 9.00% 11.50% 11.50% Required employer contribution rate 7.959% 7.114% 18.152% 13.044% 13.044% Contributions
For the year ended June 30, 2021, the contributions recognized as part of pension expense for each plan were as follows:

Miscellaneous
Safety
80 $
$
1,313,856
1,750,135
3,063,991
City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 9 - Pension Plans (Continued)
C. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions Proportionate Share of Net Pension Liability and Pension Expense The following table shows the plan's proportionate share of the risk pool collective net pension liability over the measurement period:

Plan Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability
Miscellaneous
Balance at: 6/30/19 (valuation date) $ 53,400,450 $ 40,604,002 $ 12,796,448 Balance at: 6/30/20 (measurement date) 55,207,945 41 ,257,766 13,950,179 Net changes during2019-2020 1,807,495 653,764 1,153,731 Safety
Balance at: 6130119 (valuation date) $ 55,748,051 $ 40,888,911 $ 14,859,140 Balance at: 6/30/20 (measurement date) 57,956,339 41 ,647,330 16,309,009 Net changes during2019-2020 2,208,288 758,419 1,449,869 Total
Balance at: 6/30/19 (valuation date) $ 109,148,501 $ 81 ,492,91 3 $ 27,655,588 Balance at: 6/30/20 (measurement date) 113,164,284 82,905,096 30,259,188 Net changes during2019-2020 4,015,783 1,412,183 2,603,600 The City's net pension liability/( asset) for each Plan is measured as the propmtionate share of the net pension liability/(asset). The net pension liability/(asset) of each of the Plans is measured as of June 30, 2020, and the total pension liability/(asset) for each Plan used to calculate the net pension liability/(asset) was determined by an actuarial valuation as of June 30, 2019 rolled forward to June 30, 2020 using standard update procedures. The City's propo1tion of the net pension liability/(asset) was based on a projection of the City's long-term share of contributions to the pension plans relative to the projected contributions of all participating employers, actuarially determined.

The City's propmtionate share of the net pension liability/( asset) for each plan as of June 30, 2019 and 2020 was as follows:

Prop01tion - June 30, 2019
Proportion - June 30, 2020
Change - increase/( decrease)
Miscellaneous

0.12488%

0.12821%

0.00333%
81 Safety

0.1450 1%

0.14989%

0.00488%
Total

0.26351%

0.27811%

0.01460%
City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 9 - Pension Plans (Continued)
C. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
For the year ended June 30, 2021, the City recognized pension expense of $1,923,556 and $2,663,046, for the Miscellaneous and Safety plans, respectively. At June 30, 2021, the City reported deferred outflows ofresources and deferred inflows of resources related to pensions from the following sources:
:Miscellaneous Plans
Defened Outflows Dcfened Inflows
of Resources of Resources
Pension contributions made subsequent to measurement date $ 1,313,856 $ Difference between projected and actual earning on
pension plan investments 414,412
Adjustment due to differences in propo1tions 565,731
Changes in assumptions 99,498
Difference between actual and expected eiqierience 718,894 Difference between employer's actual contributions
and proportionate share of contributions 1,069,060
Total $ 3,012,893 $ 1,168,558
Safety Plans
Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contributions made subsequent to measurement date $ 1,750,135 $ Difference between projected and actual earning on
pension plan investments 354,463
Adjustment due to differences in proportions 237,715
Changes in assumptions 54,326
Difference between actual and expected e>.'Perience 1,264,681 Difference between employer's actual contributions
and proportionate share of contributions 758,366
Total $ 3,606,994 $ 812,692
Total
Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contributions made subsequent to measurement date $ 3,063,991 $ Difference between projected and actual earning on
pension plan investments 768,875
Adjustment due to differences in propo1tions 803,446
Changes in assumptions 153,824
Difference between actual and expected ex'Perience 1,983,575 Difference between employer's actual contributions
and proportionate share of contributions 1,827,426
Total $ 6,619,887 $ 1,981,250
82 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 9 - Pension Plans (Continued)
C. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continuerlj
For the Miscellaneous Plan and Safety Plan, $1,313,856 and $1,750,135, respectively, was reported as deferred outflows of resources related to pensions resulting from City's contributions subsequent to the measurement date and will be recognized as a reduction of the net pension liability in the year ended June 30, 2022. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Miscellaneous Safety
Year Ended June 30, Plans Plans Total
2022 $ (117,801) $ 118,773 $ 972
2023 212,163 386,573 598,736
2024 237,353 361,217 598,570
2025 198,764 177,604 376,368
2026
Thereafter
$ 530,479 $ 1,044,167 $ 1,574,646
Actuarial Assumetions
The total pension liabilities in the June 30, 2019 actuarial valuations were detennined using the following actuarial assumptions:

Actuarial Cost Method
Actuarial Assumptions:

Discount rate
Inflation
Salary increases
Investment rate of return
Mortality rate table
Post retirement benefit increase
Entry Age Normal

7.15%

2.75%
Varies by Entry Age and Service

7.65%
Derived using CalPERS' Members hip Data for all Funds. The mortality table used was developed based on CalPERS' specific data.

The table includes 20 years of mortality inlprovements using Society of Actuaries Scale BB.

Contract COLA up to 2.75% until Purchasing Power Protection Allowance Floor on Purchasing Power applies, 2.75% thereafter.

The underlying m01iality assumptions and all other actuarial assumptions used in the June 30, 2019 valuation were based on the results of a December 2017 actuarial experience study for the period 1997 to 2015. Frniher details of the Experience Study can be found on the CalPERS website. 83 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 9 - Pension Plans (Continued)
C. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
Discount Rate
In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectations as well as the expected pension fund cash flows. Such cash flows were developed assuming that both members and employers will make their required contributions on time and as scheduled in all future years. Using historical returns of all the funds' asset classes expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11-60 years) using a building-block approach.

Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both sho1t-term and long-term returns.

The expected rate of return was then set equivalent to the single equivalent rate calculated above and rounded down to the nearest one quaiter of one percent.

The table below reflects long-term expected real rate ofreturn by asset class. The rate ofreturn was calculated using the capital market assumptions applied to determine the discount rate and asset allocation. These geometric rates of return are net of administrative expenses.

New Strategic
Asset Class Allocation
Global equity 50.00%
Global fixed income 28.00%
Inflation sensitive assets 0.00%
Private equity 8.00%
Real assets 13.00%
Liquidity 1.00%
1 An expected inflation of 2.00% was used for this period. 2 An expected inflation of 2.92% was used for this period.

Real Return Years Real Return Years
1 -10 I 11 + 2

4.80% 5.98%

1.00% 2.62%

7.00% 1.81%

6.30% 7.23%

3.75% 4.93%

0.00% -0.92%
The discount rate used to measure the total pension liability was 7.15% for the plan. To determine whether the municipal bond rate should be used in the calculation of a discount rate for each plan, CalPERS stress tested plans that would most likely result in a discount rate that would be different from the actuarially assumed discount rate.

Based on the testing, none of the tested plans run out of assets. Therefore, the current 7.15% discount rate is adequate and the use of the municipal bond rate calculation is not necessary. The long term expected discount rate of 7.15% is applied to all plans in the Public Employees Retirement Fund (PERF). The stress test results are presented in a detailed rep01t called "GASB Crossover Testing Repo1t" that can be obtained from the CalPERS website under the GASB 68 Section.

According to Paragraph 30 of Statement 68, the long-term discount rate should be determined without reduction for pension plan administrative expense. The 7.00% investment return assumption used in this accounting valuation is net of administrative expenses. Administrative expenses are assumed to be 15 basis points. An investment return excluding administrative expenses would have been 7.15%. Using this lower discount rate has resulted in a slightly higher total pension liability and net pension liability. The difference was deemed immaterial to the Public Agency Cost Sharing Multiple-Employer Defined Benefit Pension Plan. 84 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 9 - Pension Plans (Continued)
C. Pension Liabilities, Pension Expenses and Deferred Outjlowsllnjlows of Resources Related to Pensions (Continued)
Sensitivity of the Proportionate Share of the Net Pension Liabilitv to Changes in the Discount Rate The following presents the City's proportionate share of the net position liability for the Plan, calculated using the discount rate for each Plan, as well as what the City's proportionate share of the net pension liability would be if it were calculated using a discount rate that is I-percentage point lower or I-percentage point higher than the current rate:

Miscellaneous
Safety
Total
Pension Plan Fiduciary Net Position
Plan's Net Pension Liability/(Asset)
Discount Rate -1 % Current Discount Discount Rate+ I%
$
$
$
(6.15%) Rate (7.15%) (8.15%)
21 ,297,009 $ 13,950, 179 $ 7,879,724 =======
24, 179,695 $ 16,309,009 $ 9,850,366 =======
45,476,704 $ 30,259,188 $ 17,730,090 =======
Detailed information about the pension plan's fiduciary net position is available in the separately issued CalPERS financial reports.

D. Payable to the Pension Plan
At June 30, 202 I, the City had no outstanding amounts owed to the pension plan for contributions for the year ended June 30, 2021.

Note 10 - Other Postemployment Benefits
A. Summary
Governmental Business-Type
Activities Activities Total
Deferred outflows of resources:

Difference between expected and actual ex'Perience $ 327,477 $ 102,294 $ 429,771 Changes in assumptions 3,520,478 1,099,685 4,620,163
Total deferred outflows of resources $ 3,847,955 $ 1,201 ,979 $ 5,049,934 Total OPEB liability:

Total OPEB liability $ 30,025,193 $ 9,378,908 $ 39,404,101 Total OPEB liability $ 30,025,193 $ 9,378,908 $ 39,404,101 OPEB expense $ 1,771,978 $ 553,510 $ 2,325,488
85 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 10 - Other Postemployment Benefits (Continued)
B. General Information about OPEB
Plan Description
As of June 30, 2020, the date of its most recent OPEB actuarial valuation, the City provided health benefits to 37 retirees. In addition, 102 active employees are earning service credit for future retiree health benefits. With the exception of members of the Calexico Police Officers Association, employees hired on or after July 1, 2008 are not eligible for retiree health benefits. Employees hired prior to May 18, 1993 retiring from the City under CalPERS are eligible for City-paid retiree medical and dental benefits for themselves and eligible dependents. The retiree is responsible for a monthly contribution equal to $120. Employees hired on or after May 18, 1993 are eligible for City paid retiree medical benefits for themselves only to the retiree's attainment of age 65.

Eligibility
Eligibility requires retirement from the City under PERS with at least 20 years of service. Retirees with less than 30 years of service at retirement are required to pay a monthly contribution. The retiree may also elect to cover and pay for eligible dependents based on the COBRA rate.

Membership in the plan consisted of the following at June 30, 2020, the date of the latest actuarial valuation:

Retirees
Active plan members
Total
Contributions
37 102
139
The obligation of the City to contribute to the plan is established and may be amended by the City Council. The City Council has established a policy of funding the actuarially determined contribution (ADC) on a pay as you go basis through June 30, 2021. For the fiscal year ended June 30, 2021, the City's average contribution rate was 9.0% of covered-employee payroll. Employees are not required to contribute to the plan.

C. Total OPEB Liability, OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB Total OPEB Liability
The City's total OPEB liability was measured as of June 30, 2021. The total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation as of June 30, 2020. The total OPEB liability at June 30, 2021 was $39,404,101.
86 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 10 - Other Postemployment Benefits (Continued)
C. Total OPEB Liability, OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB (Continued) Actuarial Assumptions
The total OPEB liability in the June 30, 2020 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement, unless otherwise specified:

Actuarial Assumptions:

Discount Rate
Inflation
Aggregate payroll increases

2.19%

2.75%

2.75%
Expected long-term investment rate ofreturn n/a
Mortality, Termination, and Disability
Mo1tality Improvement Scale
CalPERS 2017 Experience Study
Modified projected fully generational with Scale MP-2019 Healthcare Trend Rate An annual healthcare cost trend rate of 6.5% initially reduced by decrements to an ultimate of 4.5% therefore.

The actuarial assumptions used in the June 30, 2020 valuation were based on the results of an actuarial experience study for the period July 1, 2019 through June 30, 2020.

Discount Rate
The discount rate used to measure the total OPEB liability was 2.19% percent. This discount rate is the mid-point, rounded to five basis points, of the range of 3-20 year municipal bond rate indices; S&P Municipal bond 20 Year High Grade Rate Index, Bond Buyer 20-Bond GO Index, and Fidelity GO AA 20 Year Bond Index.

Change in the Total OPEB Liability
Balance at June 30, 2020
Changes Recognized for the Measurement Period:

Service Cost
Interest on the total OPEB liability
Difference between expected and actual experience
Changes of assumptions
Benefit payments
Net Changes during July I, 2020 to June 30, 2021
Balance at June 30, 2021 (measurement date)
87 Total OPEB
Liability
$ 27,955,092
744,778
751,908
8,428,759
2,394,594
(871 ,030)
11,449,009
$ 39,404,101
City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 10 - Other Postemployment Benefits (Continued)
C. Total OPEB Liability, OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB (Continued) Sensitivity of the Total OP EB Liability to Changes in the Discount Rate The following presents the total OPEB liability of the City, as well as what the City's total OPEB liability would be if it were calculated using a discount rate that is I-percentage-point lower (1.19%) or I-percentage- point higher (3.19%) than the current discount rate:

Plan's Total OPEB Liability
Discount Rate - 1% Current Discount Discount Rate+ 1%
(1.19%) Rate(2.19%) (3.19%)
$ 45,273,215 $ 39,404,101 $ 34,547,693
Sensitivity of the Total OPEB LiabiliD1 to Changes in the Health Care Cost Trend Rates The following presents the total OPEB liability of the City, as well as what the City's total OPEB liability would be if it were calculated using healthcare cost trend rates that are I-percentage-point lower or I-percentage-point higher than the current healthcare cost trend rates:

Plan's Total OPEB Liability
-1%
$ 33,611 ,562 $
Healthcare Cost
Trend Rates
39,404, 101 $
+ 1%
46,569,243
OPEB Expense and Deferred Outflows of Resources and Deferred Inflows o[Resources Related to OPEB For the fiscal year ended June 30, 2021, the City recognized OPEB expense of$2,325,488. At June 30, 2021, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

Deferred outflows
of Resources
Deferred inflows
of Resources
Difference between expected and actual experience $ 429,771 $ Changes of assumptions 4,620,163
T~al $ 5,049,934 $
As of June 30, 202 I, the City's OPEB Plan did not hold assets or have a Fiduciary Net Position. If the Plan did have assets, however, the Plan's policy is to amortize the difference between projected OPEB plan investment earnings and actual earnings is amortized over a five-year period. The remaining gains and losses are amortized over the expected average remaining service life. The expected average remaining service life is 5 years, which was determined as of June 30, 2020, the beginning of the measurement period, for employees covered by the OPEB plan benefit terms as of the valuation date.
88 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 10 - Other Postemployment Benefits (Continued)
C. Total OPEB Liability, OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB (Continued) OP EB Expense and Deferred Outflows of Resources and Deferred Jnflmvs of Resources Related to OP EB (Continued)
Amount rep01ted as defened outflows of resources and deferred inflows of resources related to OPEB will be recognized as future OPEB expense as follows:

Measurement Period Deferred Outflows/
Ended June 30 (Inflows) ofResources
2022 $ 828,802
2023 923,249
2024 583,897
2025 583,897
2026 583,894
Thereafter 1,546,195
$ 5,049,934
Note 11 - Joint Powers Agreement - Calexico Special Financing Authority The Calexico Special Financing Authority ("Authority") was formed by a Joint Exercise of Powers Agreement (Joint Powers Agreement), dated as of June 20, 1996, by and between the City and the Heffernan Memorial Hospital District ("District"). The Authority is a public entity separate from the City and District. The Authority was created for the purpose of providing financing for local agencies, including the District and the City; and it is authorized pursuant to the Bond Law to issue bonds for the purpose of providing such financing. The debts, liabilities, and obligations of the Authority do not constitute debts, liabilities, or obligations of either the City or the District.

The Authority is administered by a commission (Commission) which consists of four members, each serving in his or her individual capacity as a member of the Commission. Two members of the Commission are appointed by the Mayor of the City, and two members of the Commission are appointed by the governing body of the District. All actions taken by the Authority require the affirmative vote of not less than three members of the Commission.

The Joint Powers Agreement continues in full force and effect until December 31, 2016, unless extended or earlier terminated. The date of the final maturity of the bonds is January 1, 2018, but the Joint Powers Agreement may not terminate or be terminated until the date on which all the bonds and other indebtedness issued or to be issued by the Authority shall have been retired or full provision shall have been made for their retirement. The Joint Powers Agreement provides, among other things, that the City shall not be liable to the District or the Hospital on account of the City's patticipation in the Authority; that the City shall not be required to make any contributions, payments, or advances of public funds to the Authority.

In the Joint Powers Agreement, the City and the District agree to comply with all provisions of law relating to the one half percent special district sales tax; the City specifically agrees to take the steps necessary to continue to levy and collect the sales tax for the use thereof by the District; and the District agrees to take any and all actions required to maintain its status as a health care district under the State Constitution and laws of the State. 89 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 11 - Joint Powers Agreement - Calexico Special Financing Authority (Continued) The Authority has no assets other than the Trust Estate and no income other than the tax revenues. Moreover, any assets acquired or income received by it in the future (other than assets that would be part of the Trust Estate and income that would constitute the revenues) would be pledged to the payment of the principal of or interest on the bonds.

On June 21, 2001, the Authority issued the Refunding Revenue Bonds, Series 2001 to advance refund the previously issue Revenue Bonds, Series 1996.

The bonds were issued to provide funds to purchase ce1iain obligations of the District and to establish a reserve fund for the bonds. The bonds are authorized pursuant to the provisions of the Marks-Roos Local Bond Pooling Act of 1985 and are issued pursuant to a Trust Agreement dated October 29, 1996 by and between the Authority and State Street Bank and Trust Company of California, N.A. (Trustee). The bonds are payable from the Yi cent sales tax authorized to be imposed and collected within the corporate boundaries of the City for exclusive use of the District. The District has pledged and assigned its rights in the sales tax revenue to the Authority; and the Authority, in turn, has pledged and assigned its rights therein to the Trustee for the benefit of the owners of the bonds.

The bonds are special limited obligations of the Authority, payable from, and secured as to the payment of the principal and interest on the bonds in accordance with their terms and the terms of the trust agreement, solely from the Trust Estate. The bonds do not constitute a charge against the general credit of the Authority or any of its members, and under no circumstances shall the Authority be obligated to pay principal or interest on the bonds except from the Trust Estate.

Neither the State of California nor any public agency (other than the Authority) nor any member of the Authority is obligated to pay the principal or interest on the bonds. Neither the faith and credit (except to the extent of the sales tax revenues) nor the taxing power of the State of California or any public agency thereof or any member of the Authority is pledged to the payment of the principal or interest on the bonds, and neither the principal or interest on the bonds constitutes a debt, liability or obligation of the State of California or any public agency (other than the Authority) or any member of the Authority.

Note 12 - Commitments and Contingencies
A. Litigation
The City is a defendant in certain legal actions arising in the normal course of operations. Liabilities for the probable amounts of loss associated with these claims are have been accrued in the financial statements as discussed in Note 8 - Risk Management.

B. Grants
The City pmiicipates in ce1iain federal and state assisted grant programs. These programs are subject to program compliance audits by the grantors and their representatives.

With respect to the City's other grant programs, any liability for reimbursement which may arise as the result of grantor audits, if any, is not believed to be material.

C. Construction
Various construction projects were in progress at June 30, 2021 with an estimated cost to complete of approximately $57,750,918 planned for in all fund types.
90 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 12 - Commitments and Contingencies (Continued)
D. CFD 2013-1
The City has committed to make annual payments to the Community Facility District 2013-1 (District) on behalfof the District's prope1ty owner through an Agreement Re: Covenants ("Agreement") executed in July 2013. The District was formed in 2013 to finance improvements supp01ting the development of the Gran Plaza shopping center and related City development impact fees.

In the Agreement, the City agreed to pay a portion of sales tax revenues earned from the Gran Plaza shopping center to the CFO on behalf of the prope1ty owner. Annual City payments are calculated in the following four step process:

1. The City retains the first $300,000 of sales tax earned at Gran Plaza each operating (calendar) year.

2. Sales tax in excess of $300,000 is paid to the District up to the District's annual debt service.

3. Sales tax in excess of$300,000 and in excess of the District's annual debt service is retained by the City, up to an amount matching the City's payment to the District for its annual debt service.

4. Sales tax in excess of amounts applied in Steps 1 to 3 is divided in half, with half retained by the City and half paid to the District for the refunding of outstand District bonds.

During the year ended June 30, 2021, the City paid $0 to the District under the terms of this Agreement.

Note 13 - Deferred Compensation Plan
The City offers a deferred compensation plan for regular employees created in accordance with Internal Revenue Code Section 457. Under the terms of this plan, employees may defer amounts of income up to a maximum of $17,000 per year or one-hundred percent (100%) of includable compensation, whichever is less. Amounts so deferred may be withdrawn or directed for future payment at separation of employment but may not be paid to the employee during employment with the City except for a catastrophic circumstance creating an undue and unforeseen financial hardship for the employee.

Federal legislation, (Small Business Job Protection Act of 1996) requires the Section 457 plan assets to be placed in trust for the exclusive use of the plan pmticipants and their beneficiaries. The City's deferred compensation administrator qualifies as the plan trustee to meet Federal requirements. Since the plan assets are not considered the property and rights of the City, such assets are not reflected in the accompanying basic financial statements.

Note 14 - Self-Funded Medical, Dental and Vision Plan
The City of Calexico provides its employees, eligible retirees and elected officials with an option to pmticipate in a selffunded employer sponsored health plan. In this plan the City takes on the financial risk of funding the plan from its assets and is responsible for managing and administering the plan.

The City administers the plan through a third-party administrator (TPA) and purchases excess insurance coverage to protect itself from extreme claims and utilization levels. This excess insurance is called employer stop-loss (ESL) coverage. In addition to covering the potential losses inherent with any group benefit plan, the City's ESL coverage provides protection for the entire covered group, reimbursement for medical expenses above a specified dollar amount of $75,000, and coverage for catastrophic and high dollar claims such as transplants, leukemia, renal failure and premature bi1ths.

The City provides a network of Exclusive Provider Organization (EPO) pmticipants and a Preferred Provider Organization (PPO) network for eligible retirees and Police Officers Association (POA) members. 91 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 15 - Other Required Disclosures
A. Deficit Fund Balances/Net Position
At June 30, 2021, the Governmental Activities Statement of Net Position had an unrestricted net position deficit of $( 45,404,894 ).

At June 30, 2021, the following funds had a fund balances (deficit) or net position (deficit), which will be eliminated through the reduction in future expenditures and/or the use of new funding sources:

Fund
DIF - Fire
Successor Agency to the Calexico Community
Redevelopment Agency
B. Expenditures Exceeding Appropriations
Fund Type Deficit
Special Revenue Fund $ (132,764)
Private Purpose Trust Fund (13,482,646)
For the year ended June 30, 2021, expenditures exceeded appropriations in the following functions of the General Fund:

Fund
General Fund
General Fund
LT A Measure D Special Revenue Fund
Note 16 - Fund Balance Classification
Function
General government
Public safety: Fire
Public works
Excess Expenditures
$ 273,141
215,762
150,000
The City classifies fund balances, as shown on the Balance Sheet - Governmental Funds as of June 30, 2021 as follows:

Major Funds
LTAMeasureD LTAMeasureD Measure H Other
General Special Revenue Capital Projects Cap ital Projects Governmental Fund Fund Fund Fund Funds Total
Non-spendable:

Inventories and prepaid items $ 79,973 $ $ $ $ $ 79,973 Total non-spendable 79,973 79,973
Restricted:

Debt service payments 3,085,633 3,085,633
Public works 4,612,461 4,612,461
Culture and recreation 77,392 77,392
Housing 5,010,481 5,010,481
Capital projects 9,434,051 2,548,393 2,058,377 8,694,200 22,735,021 Total restricted 9,434,051 2,548,393 2,058,377 21,480,167 35,520,988 Assigned:

Capital Projects 523,000 523,000
Total assigned 523,000 523,000
Unassigned (deficit) 1,918,993 913,236 2,832,229
Total unassigned 1,918,993 913,236 2,832,229
Total fund balances $ 1,998,966 $ 9,434,051 $ 2,548,393 $ 2,058,377 $ 22,916,403 $38,956,190 92 City of Calexico
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2021
Note 17 - Prior Period Adjustments
A. Fiduciary Fund Financial Statements
The beginning net position at July 1, 2020 of the Fiduciary Fund Financial Statements was restated as follows:

Corsair 2013- 1 Hearthstone
Gran Plaza Towncenter 2005-1 Venez ia
CFO CFO CFO CFO Total
Net position, as previously reported, at July 1, 2020 $ $ $ $ $ To implement GASB 84 1,089,238 8,458 446,562 22,339 1,566,597 Net position at July I, 2020, as restated $ 1,089,238 $ 8,458 $ 446,562 $ 22,339 $ 1,566,597 Note 18 - Subsequent Events
A. American Rescue Plan Act
On March, 2021, the American Rescue Plan Act was signed into delivering $65 billion of direct and flexible aid to cities and towns across the nation to provide substantial flexibility for each government to meet local needsincluding suppmt for households, small businesses, impacted industries, essential workers, and the communities hardest hit by the crisis. Based on the City's population, the City was allocated $9,526,987 and received in two installments stmting July 2021.
93 This page i11te11tionally left blank.
94 REQUIRED SUPPLEMENTARY INFORMATION
(Unaudited).
95 This page i11te11tional{v left blank.
96 City of Calexico
Required Supplementary Information (Unaudited)
Notes to the Budgetary Information
For the Year Ended June 30, 2021
Note 1 - Budgetary Information
The City Council has the responsibility for adoption of the City's budget. From the effective date of the budget, the amounts stated as proposed expenditures become appropriations to the various City depatiments. The City Council may amend the budget by motion during each fiscal year. The City Manager is authorized to transfer budget appropriations within the General Fund at the depatiment level or at the fund level for other funds. Budget amendments to a total General Fund depatiment budget, non-General Fund fund budget, or a capital project require City Council approval.

All appropriations lapse at the end of the fiscal year to the extent that they have not been expended. Lease contracts entered into by the City are subject to annual review by the City Council; hence, they legally are one-year contracts with an option to review for another fiscal year.
97 City of Calexico
Required Supplementary Information (Unaudited) (Continued) Budgetary Comparison Schedule - General Fund
For the Year Ended June 30, 2021
Budgeted Amounts
General Fund Measure H Fund Original Act ual
Original Original Total Final Amounts
REVENUES :

Property taxes $ 2,726,6 17 $ $ 2,726,6 17 $ 2,787,509 $ 2,848,208 Other taxes:

Other taxes 5,488,350 5,488,350 4,694,000 5, 155,628
Measure H sales tax 2,625,000 2,625,000 2,675,000 3, 120,542 Total ot her taxes 5,488,350 2,625,000 8,1 13,350 7,369,000 8,276,170 Licenses, pennits and fees 1,7 15,600 1,7 15,600 1,538,000 1,77 1,426 Intergovernmental 3,436,547 3,436,547 3,5 15,647 3,554,5 10 Charges for services 1,907,613 1,907,6 13 1,718, 170 1,798,728 Fin es and forfeitures 220,500 220,500 85,600 131,941
Use of money and property 570,820 570,820 570,120 571,243 Other revenues 10,000 15,304
Total revenues 16,066,047 2,625,000 18,691,047 17,594,046 18,967,530 EXPEN DITURES:

Current:

General government 3,15 1,693 3, 15 1,693 3,098,929 3,372,070 Public safety:

Police 5,343,623 850,000 6, 193,623 6,069,873 5,694,585 Fire 4, 150,693 400,000 4,550,693 4,539,817 4,755,579
Total public safety 9,494,316 1,250,000 10,744,3 16 10,609,690 10,450, 164 Public works 1,038,764 1,038,764 996,264 909,657
Cult ure and recreation 1,067,2 12 1,067,2 12 864,262 815,845 Planning and buildi ng 931,905 93 1,905 679,405 677, 159 Housing 346,698 346,698 9 1,148 86,4 18
Contribution to CFD 20 13-1 382,000 382,000
Capital outlay 134,889 98,504
Debt service:

Principal 20,065 20,065 33,703 33,600
Interest and fiscal charges 6,394 6,394 10,756 10,756
Total expenditures 16,439,047 1,250,000 17,689,047 16,519,046 16,454, 173

REVENUES OVER
(UNDER) EXPENDITURES (373,000) 1,375,000 1,002,000 1,075,000 2,5 13,357 OTHER FINANCING SOURCES (USES):

Transfers out ( 1,002,000) ( 1,002,000) (1,075,000) (1,520, 154) Total other finan ci ng sou rces (uses) ( 1,002,000) (1,002,000) (1,075,000) (1,520, 154) Ne t changes in fund balance $ (373,000) $ 373,000 $ $ 993,203 FUND BAIANCE:

Beginning of year 1,005,763
End of year $ 1,998,966
98 Variance with
Final Budget
$ 60,699
46 1,628
445,542
907,170
233,426
38,863
80,558
46,34 1
1,123
5,304
1,373,484
(273,14 1)
375,288
(2 15,762)
159,526
86,607
48,4 17
2,246
4,730
36,385
103
64,873
1,438,357
(445, 154)
(445, 154)
$ 993,203
City of Calexico
Required Supplementary Information (Unaudited) (Continued) Budgetary Comparison Schedule-LTA Measure D Special Revenue Fund For the Year Ended June 30, 2021
Budgeted Amounts Actual Variance with
Original Final Amounts Final Budget
REVENUES:

Intergovernmental $ 840,000 $ 840,000 $ 1,045,280 $ 205,280 Use of money and property 5,345 5,345
Total revenues 840,000 840,000 1,050,625 210,625
EXPENDITURES:

Current:

Public works 150,000 (150,000)
Capital outlay 2,711,613 2,711,613 97,353 2,614,260
Total expenditures 2,711 ,613 2,711,613 247,353 2,464,260

REVENUES OVER
(UNDER) EXPENDITURES (1 ,871 ,613) (1,871 ,613) 803,272 2,674,885 OTHER FIN AN CING S 0 URCES (US ES):

Transfers in 355,622 355,622
Total other financing sources (uses) 355,622 355,622
Net changes in fund balance $ (1,871,613) $ (1,871 ,613) 1,158,894 $ 3,030,507 FUND BAIANCE:

Beginning of year 8,275,157
End of year $ 9,434,051
99 City of Calexico
Required Supplementary Information (Unaudited) (Continued) Budgetary Comparison Schedule - Other Operating Grants Special Revenue Fund For the Year Ended June 30, 2021
Budgeted Amounts Actual Variance with
REVENUES:

Intergovernmental
Total revenues
EXPENDITURES:

Current:

General government
Planning and building
Housing
Total expenditures

REVENUES OVER
(UNDER) EA'PENDITURES
OTHER FINANCING SOURCES (USES):

Transfers in
Total other financing sources (uses)
Net changes in fund balance
FUND BALANCE:

Beginning of year
End of year
Original
$ 160,000
160,000
160,000
160,000
$
100
$
$
Final
7,008,266
7,008,266
191 ,000
160,000
6,657,266
7,008,266
$
$
Amounts
6,728,388
6,728,388
35,285
35,837
6,657,266
6,728,388
23,336
23,336
23,336
(23,336)
$
$
Final Budget
(279,878)
(279,878)
155,715
124,163
279,878
23,336
23,336
23,336
City of Calexico
Required Supplementary Information (Unaudited) (Continued) Schedule of the City's Proportionate Share of the Net Pension Liability and Related Ratios Last Ten Years
For the Year Ended June 30, 2021
Miscellaneous Plan
Measurement period, year ended 6/30/2020 6/30/2019 6/30/2018 6/30/2017 6/30/2016* Plan's propo1iion of the net pension liability 0.1282135% 0.1248795% 0.1205049% 0.1152051% 0.1187121% Plan's propo1iionate share of the net pension liability $ 13,950,179 $ 12,796,448 $ 11 ,612,169 $ 11, 772,982 $ 11 ,772,982 Plan's covered-employee payroll $ 5,434,448 $ 5,438,921 $ 5,280,506 $ 5,126,704 $ 4,977,383 Plan's propo1iionate share of the net pension liability as a percentage of covered-employee payroll 256.70% 235.28% 219.91% 229.64% 236.53% Plan's fiduciary net position $ 41 ,257,766 $ 40,604,002 $ 39,627,144 $ 38,307,558 $ 35,624,733 Plan's fiduciary net position as a percentage of the
total pension liability 74.73% 76.04% 77.34% 76.49% 75 .16% Plan's proportionate share of aggregate
employer contributions $ 1,133,328 $ 895,434 $ 687,419 $ 467,363 $ 438,015 * - The Miscellaneous Plans transitioned from an Agent plan to Cost-Sharing plan at Measurement Date (6/30/2016), therefore only three years are shown.
101
City of Calexico
Required Supplementary Information (Unaudited) (Continued) Schedule of Changes in the Net Pension Liability and Related Ratios Last Ten Years
For the Year Ended June 30, 2021
Safety Plan
Measurement period, year ended 6130/2020 6130/2019 6130/2018 6130/2017 6130/2016 6130/2015 Plan's proportion of the net pension Liability 0.149893% 0.145009% 0.146625% 0. 144796% 0.144796% 0.15 1039% Plan's proportionate share of the net pension liability $ 16,309,009 $ 14,859,140 $ 14,129,130 $ 14,359,822 $ 12,862,930 $ 10,367,155 Plan's covered-employee payroll $ 3,298,148 $ 4,302,084 $ 4,176,782 $ 4,055,128 $ 3,937,017 $ 4,423,592 Plan's proportionate share of the net pension liability as a percentage of covered-employee payroll 494.49% 345.39% 338.28% 354.12% 326.72% 234.36% Plan's fiduciary net position $ 41,647,330 $ 40,888,911 $ 39,609, 126 $ 37, I 00,280 $ 34,521,294 $ 36,372,416 Plan's fiduciary net position as a percentage oft he
total pension liability 71.86% 73.35% 73.71% 72.10% 72.85% 77.82% Plan's proportionate share of aggregate
employer contributions $ 1,517,998 $ 1,249,93 1 $ 1,523,035 $ 1,466,631 $ 1,385,061 $ 1,275, 182 1 Infonnation only presented from the implementation year 102
6130/2014 1

0.159430%
$ 9,920,642
$ 4,864,763
203.93%
$ 35,281,244

78.05%
$ 1,305,223
City of Calexico
Required Supplementary Information (Unaudited) (Continued) Schedule of Changes in the Net Pension Liability and Related Ratios (Continued) Last Ten Years
For the Year Ended June 30, 2021
Miscellaneous Plan
Total Pension Liability 6/30/2015* 6/30/2014*
Service cost
Interest on total pension liability
Differences between e:-.pected and actual e:-.perience
Changes in assumptions
Changes in benefit terms
Benefit payments, including refunds of employee contributions Net change in total pension liability
Total pension liability- beginning
Total pension liability- ending (a)
Plan fiduciary net position
Contributions - employer
Contributions - employee
Investment income (net of administrative e:-.penses)
Benefit payments
Other
Net change in plan fiduciary net position
Plan fiduciary net position - beginning
Plan fiduciary net position - ending (b)
Net pension liability- ending (a)-(b)
Plan fiduciary net position as a percentage of the
total pens ion liability
Covered-employee payroll
Net pension liability as a percentage of coveredemployee payroll Notes to Schedule:
$
$
$
$
$
$
667,325 $ 693,757
3,135,933 2,997,774
(259,080)
(840,438)
(1 ,654,333) (1 ,458,707)
1,049,407 2,232,824
42,585,621 40,352,797
43 ,635,028 $ 42,585,621
389,771 $ 344,145
375,172 396,410
807,277 5,423,642
(1 ,654,333) (1 ,458,707)
(40,762)
(122,875) 4,705,490
36,319,001 31 ,613,51 I
36,196, 126 $ 36,319,001
7,438,902 $ 6,266,620

82.95% 77.52%
5,315,723 $ 5,851 ,522
139.94% 107.09%
* - The Miscellaneous Plans transitioned from an Agent p Ian to Cost-Sharing plan at Measurement Date (6/30/2016), therefore only two years are shown.
103
City of Calexico
Required Supplementary Information (Unaudited) (Continued) Schedule of Contributions
Last Ten Years
For the Year Ended June 30, 2021
Miscellaneous Plan
Fiscal Year:

Contractually detennined
contribution (actuarially detennined)
Contributions in relation to the
actuarially determined contributions
Contribution deficiency (excess)
Covered pay roll
Contributions as a percentage of
covered pay roll
Notes to Schedule
2020-21
$ 1,3 13,856
(1,313,856)
$
$ 5,984,193

21.96%
2019-20
$ 1,133,328
(1, 133,328)
$
$ 5,434,448

20.85%
Methods and assumptions used to determine contribution rates:
2018-19 2017-18
$ 895,434 $ 687,419
(895,434) (687,419)
$ $
$ 5,438,921 $ 5,280,506

16.46% 13.02%
2016-17
$ 467,363
(467,363)
$
$ 5,126,704

9.12%
2015-16
$ 438,015
(438,015)
$
$ 4,977,383

8.80%
2014-15 2013-14 1
$ 389,770 $ 344,145
(389,770) (344,145)
$ $
$ 5,315,723 $ 5,851,522

7.33% 5.88%
The actuarial methods and assumption used to set the actuarially determined contributions for Fiscal Year 2021 were derived from the June 30, 2018 funding valuation report.

Actuarial cost method
Amortization method/period
Asset valuation method
Inflation
Salary increases
Pay roll growl h
Investment rate of return
Retirement age
Mortality
Entry Agi:: Nonna!
For details, see June 30, 2018 Funding Valuation Report Actuarial Value of Assets. For details, see June 30, 20 17 Funding Valuation Report.

2.63%
Varies by entry age and service

2.875%

7.00% net of pension plan investment and administrative expenses.

The probabilities of retirement are based on the 2014 Ca!PERS Experience Study for the period from 1997 and 2011.

The probabilities of mortality are based on the 2014 CalPERS Experience Study for the period from 1997 to 20 1 I. Preretirement and Post-retirement mortality rates include 5 years of projected mortality improvement using Scale AA published by the Society of Actuaries.

Information only presented from the iniplementation year 104
City of Calexico
Required Supplementary Information (Unaudited) (Continued) Schedule of Contributions (Continued)
Last Ten Years
For the Year Ended June 30, 2021
Safety Plan
Fiscal Year: 2020-21 2019-20 2018-19 2017-18 2016-17 2015-16 2014-15 2013-14 1 Contractually determined
contribution (actuarially determined) $ 1,750, 135 $ 1,5 17,998 $ 1,249,931 $ 1,523,035 $ 1,466,63 1 $ 1,385,061 $ 1,275, 182 $ 1,305,223 Contributions in relation to the
act uarially determined contributions (1,750,135) {l,517,998) {l,249,931) {l,523,035) {1,466,631) ( 1,385,061) (1,275,182) {I ,305,223) Contribution deficiency (excess) $ $ $ $ $ $ $ $
Covered pay roll $ 4,743,588 $ 3,298,148 $ 4,302,084 $ 4,176,781 $ 4,055, 128 $ 3,937,0 17 $ 4,423,592 $ 4,864,763 Contributions as a percentage of
covered payroll 36.89% 46.03% 29.05% 36.46% 36. 17% 35.18% 28.83% 26.83% Notes to Schedule
Methods and assumptions used to determine contribution rates:

The actuarial methods and assump tion used to set the actuarially determined contributions for Fiscal Year 202 1 were derived from the June 30, 2018 funding valuation report.

Actuarial cost method
Amortization method/period
Asset valuation method
Inflation
Salary increases
Pay roll growth
Investment rate of return
Retirement age
Mortality
Entry Ar§! Nonna!
For details, see June 30, 2018 Funding Valuation Report Actuarial Value of Assets. For details, see June 30, 2017 Funding Valuation Report.

2.63%
Varies by entry age and service

2.875%

7.00% net of pension plan investment and administrative expenses.

The probabilities of retirement are based on the 2014 CalPERS faperience Study for the period from 1997 and 2011.

The probabilities of mortality are based on the 2014 Cal PERS Experience Study for the period from 1997 to 2011. Preretirement and Post-retirement mortality rates include 5 years of projected mortality improvement using Scale AA published by the Society of Actuaries.

Jnfonnation only presented from the implementation year 105
City of Calexico
Required Supplementary Information (Unaudited) (Continued) Schedule of Changes in Net OPEB Liability and Related Ratios Last Ten Years
For the Year Ended June 30, 2021
Measurement period, year ending 6/30/2021 6/30/2020 6/30/2019 6/30/20181 Total OPEB liability
Service cost $ 744,778 $ 590,159 $ 517,429 $ 515,161
Interest 751 ,908 1,072,411 1, 102,423 1,060,772
Changes of benefit terms
Differences between expected and actual ex'j)erience 8,428,759 (9,512,833) Changes of assumptions 2,394,594 2,776,757 1,696,768 (472,245) Benefit payments, including refunds of member contributions (871,030) (852,037) (832,731) (781,907) Net change in total OPEB liability 11 ,449,009 (5,925,543) 2,483,889 321 ,781 Total OPEB liability- beginning 27,955,092 33,880,635 31,396,746 31,074,965 Total OPEB liability- ending (a) $ 39,404,101 $ 27,955,092 $ 33,880,635 $ 31 ,396,746 OPEB fiduciary net position
Contributions - employer $ 871 ,030 $ 852,037 $ 832,731 $ 781,907 Net investment income
Benefit payments, including refunds of member contributions (871 ,030) (852,037) (832,731) (781 ,907) Administrative expense
Net change in plan fiduciary net position
Plan fiduciary net position - beginning
Plan fiduciary net position - ending (b)
Plan net OPEB liability- ending (a) - (b) $ 39,404,101 $ 27,955,092 $ 33,880,635 $ 31,396,746 Plan fiduciary net position as a
percentage oftbe total OPEB liability 0.00% 0.00% 0.00% 0.00% Covered-employee payroll $ 6,400,439 $ 6,229,138 $ 6,062,421 $ 5,900,167 Plan net OPEB liability as a
percentage of covered-employee payroll 615.65% 308.14% 347.81% 532.13% 1 Information only presented from the implementation year 106

SUPPLEMENTARY INFORMATION
107
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108

NON-MAJOR GOVERNMENTAL FUNDS
109
City of Calexico
Combining Balance Sheet
Non-Major Governmental Funds
June 30, 2021
Special Revenue
Library Community A1tin Cannabis Gas
Grant Donations Public Places Permits El Portal Tax
ASSETS
Cash and investments $ 1,690 $ 12,551 $ 111,622 $ 39,007 $ $ 673,860 Cash and investments with fiscal agents
Receivables:

Accounts 8,205
Intergovernmental
Due from other funds 66,904
Total assets $ 1,690 $ 79,455 $ 111 ,622 $ 39,007 $ 8,205 $ 673,860

LIABILITIES AND

FUND BALANCES
Liabilities:

Accounts payable and accrued liabilities $ 1,690 $ 2,063 $ $ 354 $ $ 63,344 Accrued payroll 3,209
Due to other funds 8,205
Deposits payable 38,653
Unearned revenue
Total liabilities 1,690 2,063 39,007 8,205 66,553
Fund Balances:

Restricted 77,392 111,622 607,307
Assigned
Unassigned (deficit)
Total fund balances 77,392 111 ,622 607,307
Total liabilities
and fund balances $ 1,690 $ 79,455 $ 111 ,622 $ 39,007 $ 8,205 $ 673,860 (Continued)
110
City of Calexico
Combining Balance Sheet (Continued)
Non-Major Governmental Funds
June 30, 2021
Special Revenue
Road Prop 172 State
Maintenance LTF Public Safety COPS Operation
Rehabilitation Article 3 TDA Sales Tax Grant Stone garden ASSETS
Cash and investments $ 1,762,714 $ 407,661 $ 121,501 $ $ $ Cash and investments with fiscal agents
Receivables:

Accounts
Intergovernmental 138,157 21,829 41,963 236,099 236,532 9,744 Due from other funds
Total assets $ 1,900,871 $ 429,490 $ 163,464 $ 236,099 $ 236,532 $ 9,744

LIABILITIES AND

FUND BALANCES
Liabilities:

Accounts payable and accrued liabilities $ 1,470 $ $ 340 $ $ 4,145 $ Accrued payroll 109
Due to other funds 236,099 232,387 9,744
Deposits payable
Unearned revenue
Total liabilities 1,470 449 236,099 236,532 9,744
Fund Balances:

Restricted 1,899,401 429,490 163,015
Assigned
Unassigned (deficit)
Total fund balances 1,899,401 429,490 163,015
Total liabilities
and fund balances $ 1,900,871 $ 429,490 $ 163,464 $ 236,099 $ 236,532 $ 9,744 (Continued)
111
City of Calexico
Combining Balance Sheet (Continued)
Non-Major Governmental Funds
June 30, 2021
Special Revenue
Bravo-Victoria General Business
Eastside Village Plan Solid Improvement
HIDTA FEMA Assessment Update Waste District
ASSETS
Cash and i11vestments $ $ 2,182 $ 558,895 $ 8,526 $ $ 19,400 Cash and investments with fiscal agents
Receivables:

Accounts
Intergovernmental 2,779 341,312 6,004
Due from other funds 534,161 662,113
Total assets $ 2,779 $ 343,494 $ 1,099,060 $ 8,526 $ 662,113 $ 19,400

LIABILITIES AND

FUND BALANCES
Liabilities:

Accounts payable and accrued liabilities $ $ 233 $ 42,347 $ $ 345,126 $ Accrued payroll
Due to other funds 2,779 315,000
Deposits payable
Unearned revenue 28,261
Total liabilities 2,779 343,494 42,347 345, 126
Fund Balances:

Resh·icted 1,056,713 8,526 316,987 19,400
Assigned
Unassigned (deficit)
Total fund balances 1,056,713 8,526 316,987 19,400
Total liabilities
and fund balances $ 2,779 $ 343,494 $ 1,099,060 $ 8,526 $ 662, 113 $ 19,400 (Continued)
112
City of Calexico
Combining Balance Sheet (Continued)
Non-Major Governmental Funds
June 30, 2021
Special Revenue Debt Service
Federal State Federal Local
HOME Grant Successor CalHOME CDBG Housing Measure H
Fund Housing Grant Grant Programs Debt Service
ASSETS
Cash and investments $ 705,022 $ 1,992,669 $ 55,824 $ 2,372,678 $ 1,635 $ Cash and investments with fiscal agents 998,040
Receivables:

Accounts 1,660 500 6,759 5,126
Intergoverrunental
Due from other funds
Total assets $ 706,682 $ 1,993, 169 $ 55,824 $ 2,379,437 $ 6,761 $ 998,040

LIABILITIES AND

FUND BALANCES
Liabilities:

Accounts payable and accrued liabilities $ 27,952 $ $ $ 103,440 $ $ Accrued payroll
Due to other funds
Deposits payable
Unearned revenue
Total liabilities 27,952 103,440
Fund Balances:

Restricted 678,730 1,993, 169 55,824 2,275,997 6,761 998,040 Assigned
Unassigned (deficit)
Total fund balances 678,730 1,993,169 55,824 2,275,997 6,761 998,040 Total liabilities
and fund balances $ 706,682 $ 1,993, 169 $ 55,824 $ 2,379,437 $ 6,761 $ 998,040 (Continued)
113
City of Calexico
Combining Balance Sheet (Continued)
Non-Major Governmental Funds
June 30, 2021
Debt Service Capital Projects
Capital Grants
Measure D General Capital Capital Projects DIF - Parks/ Debt Service Projects Fund DIF - Libraries Recreation DIF - Parking ASSETS
Cash and investments $ $ 2,189,547 $ $ 134,378 $ 425,757 $ 265,056 Cash and investments with fiscal agents 2,087,593 277,704 Receivables:

Accounts
Intergovernmental 480,810
Due from other fonds 617,833
Total assets $ 2,087,593 $ 3,085,084 $ 480,810 $ 134,378 $ 425,757 $ 265,056

LIABILITIES AND

FUND BALANCES
Liabilities:

Accounts payable and accrued liabilities $ $ $ 20,966 $ 3,750 $ $ Accrued payroll
Due to other funds 459,844
Deposits payable
Unearned revenue
Total liabilities 480,810 3,750
Fund Balances:

Restricted 2,087,593 2,562,084 130,628 425,757 265,056
Assigned 523,000
Unassigned (deficit)
Total fund balances 2,087,593 3,085,084 130,628 425,757 265,056 Total liabilities
and fund balances $ 2,087,593 $ 3,085,084 $ 480,810 $ 134,378 $ 425,757 $ 265,056 (Continued)
114
City of Calexico
Combining Balance Sheet (Continued)
Non-Major Governmental Funds
June 30, 2021
Capital Projects
DIF - General Cole Road No1ihwest Area
Government DIF - Traffic DIF- Police DlF - Fire Improvements Development ASSETS
Cash and investments $ 282,510 $ 1,804,872 $ 249,109 $ $ l,575,246 $ 464,736 Cash and investments with fiscal agents
Receivables:

Accounts
Intergovernmental
Due from other funds
Total assets $ 282,510 $ 1,804,872 $ 249,109 $ $ l,575,246 $ 464,736 LIABILITIES Al\'D

FUND BALANCES
Liabilities:

Accounts payable and accrued liabilities · $ 2,500 $ $ $ $ $ Accrued payroll
Due to other funds 132,764
Deposits payable
Unearned revenue
Total liabilities 2,500 132,764
Fund Balances:

Restricted 280,010 l,804,872 249,109 1,575,246 464,736
Assigned
Unassigned (deficit) (132,764)
Total fund balances 280,010 1,804,872 249,109 (132,764) 1,575,246 464,736 Total liabilities
and fund balances $ 282,510 $ l,804,872 $ 249,109 $ $ l,575,246 $ 464,736 (Continued)
115
City of Calexico
Combining Balance Sheet (Continued)
Non-Major Governmental Funds
June 30, 2021
Capital Projects Total
Non-Major
East Area New River Governmental
Facilities Plan Corsair, LLC Grants Funds
ASSETS
Cash and investments $ 936,702 $ $ 694 $ 17,176,044
Cash and investments with fiscal agents 3,363,337
Receivables:

Accounts 22,250
Intergovernmental 182,285 1,697,514
Due from other funds 1,881,011
Total assets $ 936,702 $ $ 182,979 $ 24,140,156

LIABILITIES AND

FUND BALANCES
Liabilities:

Accounts payable and accrued liabilities $ $ $ 61 ,493 $ 681 ,213 Accrued payroll 3,318
Due to other funds 121,486 1,518,308
Deposits payable 38,653
Unearned revenue 28,261
Total liabilities 182,979 2,269,753
Fund Balances:

Restricted 936,702 21,480,167
Assigned 523,000
Unassigned (deficit) (132,764)
Total fund balances 936,702 21,870,403
Total liabilities
and fund balances $ 936,702 $ $ 182,979 $ 24,140,156
(Concluded)
116
City of Calexico
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Non-Major Governmental Funds
For the Year Ended June 30, 2021
Special Revenue
Library Community Art in Cannabis Gas
Grant Donations Public Places Permits El Portal Tax
REVENUES:

Intergovernmental $ 36,958 $ $ $ $ $ 893,008
Charges for services 7,253 4,600 88
Use of money and property 111 625
Other revenues 7,844
Total revenues 36,958 7,844 7,364 4,600 88 893,633
EXPENDITURES:

Current:

General governn1ent 17,308
Public safety
Public works 1,303,732
Culture and recreation 36,958
Planning and building 4,600 88
Housing
Capital outlay 7,746 220,204
Debt service:

Principal
Interest and fiscal charges
Total expenditures 36,958 25,054 4,600 88 1,523,936

REVENUES OVER
(UNDER) EXPENDITURES (17,210) 7,364 (630,303)
OTHER FINANCING SOURCES (USES):

Transfers in
Transfers out
Total other financing sources (uses)
Net change in fund balances (17,210) 7,364 (630,303)
FUND BALANCES:

Beginning of year 94,602 104,258 1,237,610
End of year $ $ 77,392 $ 111 ,622 $ $ $ 607,307
(Continued)
117
City of Calexico
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Non-Major Governmental Funds
For the Year Ended June 30, 2021
Special Revenue
Road Prop 172 State
Maintenance LTF Public Safety COPS Operation
Rehabilitation Article 3 TDA Sales Tax Grant Stonegarden REVENUES:

Intergovernmental $ 758,152 $ 21 ,829 $ 41 ,963 $ 236,100 $ 236,532 $ 9,744 Charges for services
Use of money and prope1iy 1,687 404 120
Other revenues
Total revenues 759,839 22,233 42,083 236, I 00 236,532 9,744 EXPENDITURES:

Current:

General government 118,049
Public safety 118,051 236,532 9,744
Public works 14,363
Culture and recreation
Planning and building
Housing
Capital outlay 15,493
Debt service:

Principal
Interest and fiscal charges
Total expenditures 15,493 14,363 236,100 236,532 9,744

REVENUES OVER
(UNDER) EXPENDITURES 744,346 22,233 27,720
OTHER FINANCING SOURCES (USES):

Transfers in
Transfers out (23,336)
Total other financing sources (uses) (23,336)
Net change in fund balances 744,346 22,233 4,384
FUND BALANCES:

Beginning of year 1,155,055 407,257 158,631
End of year $ 1,899,401 $ 429,490 $ 163,015 $ $ $
(Continued)
118
City of Calexico
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Non-Major Governmental Funds
For the Year Ended June 30, 2021
Special Revenue
Bravo-Victoria General Business
Eastside Village Plan Solid Improvement
HIDTA FEMA Assessment Update Waste District
REVENUES:

Intergovernmental $ 3,585 $ 574,727 $ $ $ $
Charges for services 221 ,954 2,421,335 500
Use of money and property 1,132 9 535 25
Other revenues
Total revenues 3,585 574,727 223,086 9 2,421,870 525
EXPENDITURES:

Current:

General government 166,327 63
Public safety 3,585 397,426
Public works 7,169 46,047 2,350,137
Culture and recreation 3,805
Planning and building
Housing
Capital outlay 162,672
Debt service:

Principal
Interest and fiscal charges
Total expenditures 3,585 574,727 208,719 2,350,137 63

REVENUES OVER
(UNDER) EXPENDITURES 14,367 9 71 ,733 462
OTHER FINANCING SOURCES (USES):

Transfers in 3,142
Transfers out (3 ,142)
Total other financing sources (uses) (3,142) 3,142
Net change in fund balances 14,367 9 68,591 3,604
FUND BALANCES:

Beginning of year 1,042,346 8,517 248,396 15,796
End of year $ $ $ 1,056,713 $ 8,526 $ 316,987 $ 19,400
(Continued)
119
City of Calexico
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Non-Major Governmental Funds
For the Year Ended June 30, 2021
Special Revenue Debt Service
Federal State Federal Local
HOME Grant Successor CalHOME CDBG Housing Measure H
Fund Housing Grant Grant Programs Debt Service
REVENUES:

Intergovernmental $ 121,250 $ $ $ 102,804 $ $
Charges for services 4,000
Use of money and property 16,161 55 17,219 53
Other revenues
Total revenues 121 ,250 16, 161 55 102,804 21,219 53
EXPENDITURES:

Current:

General government 2,198
Public safety
Public works
Culture and recreation
Planning and building
Housing 4,701 1,093 632 5,349 97,371
Capital outlay
Debt service:

Principal 635,000
Interest and fiscal charges 360,800
Total expenditures 4,701 1,093 632 5,349 97,371 997,998

REVENUES OVER
(UNDER) EXPENDITURES 116,549 15,068 (577) 97,455 (76, 152) (997,945) OTHER FINANCING SOURCES (USES):

Transfers in 67,000 997, 154
Transfers out (67,000)
Total other financing sources (uses) (67,000) 67,000 997,154 Net change in fund balances 116,549 (51 ,932) (577) 97,455 (9, 152) (791) FUND BALANCES:

Beginning of year 562,181 2,045,101 56,401 2,178,542 15,913 998,831 End of year $ 678,730 $ 1,993,169 $ 55,824 $ 2,275,997 $ 6,761 $ 998,040 (Continued)
120
City of Calexico
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Non-Major Governmental Funds
For the Year Ended June 30, 2021
Debt Service Capital Projects
Capital Grants
Measure D General Capital Capital Projects DIF - Parks/ Debt Service Projects Fund DIF - Libraries Recreation DIF - Parking REVENUES:

Intergovermnental $ 1,850,234 $ 277,704 $ 572,217 $ $ $ Charges for services 9,385 19,994
Use of money and property 480 2,266 133 422 263
Other revenues
Total revenues 1,850,714 279,970 572,217 9,518 20,416 263 EXPENDITURES:

Current:

General government 1,571
Public safety
Public works
Culture and recreation
Planning and building
Housing
Capital outlay 182 216,595 121 ,894 3,404
Debt service:

Principal 875,000
Interest and fiscal charges 915,750
Total expenditures 1,792,32 1 182 216,595 121,894 3,404

REVENUES OVER
(UNDER) EXPENDITURES 58,393 279,788 355,622 (112,376) 17,012 263 OTHER FINANCING SOURCES (USES):

Transfers in 523,000
Transfers out (355,622)
Total other financing sources (uses) 523,000 (355,622)
Net change in fund balances 58,393 802,788 (112,376) 17,012 263 FUND BALANCES:

Beginning of year 2,029,200 2,282,296 243,004 408,745 264,793 End of year $ 2,087,593 $ 3,085,084 $ $ 130,628 $ 425,757 $ 265,056 (Continued)
121
City of Calexico
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Non-Major Governmental Funds
For the Year Ended June 30, 2021
Capital Projects
DIF - General Cole Road Northwest Area
Government DIF - Traffic DIF- Police DIF- Fire Improvements Development REVENUES:

Intergovernmental $ $ $ $ $ $
Charges for services 3,268 15,496 9,459 9,846
Use of money and property 280 1,790 247 1,563 461
Other revenues
Total revenues 3,548 17,286 9,706 9,846 1,563 461
EXPENDITURES:

Current:

General government
Public safety
Public works
Culture and recreation
Planning and building
Housing
Capital outlay 64,251 43,076
Debt service:

Principal
Interest and fiscal charges
Total expenditures 64,251 43,076

REVENUES OVER
(UNDER) EXPENDITURES (60,703) (25,790) 9,706 9,846 1,563 461 OTHER FINANCING SOURCES (USES):

Transfers in
Transfers out
Total other financing sources (uses)
Net change in fund balances (60,703) (25,790) 9,706 9,846 1,563 461 FUND BALANCES:

Beginning of year 340,713 1,830,662 239,403 (142,610) 1,573,683 464,275 End of year $ 280,010 $ 1,804,872 $ 249,109 $ (132,764) $ 1,575,246 $ 464,736 (Continued)
122
City of Calexico
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Non-Major Governmental Funds
For the Year Ended June 30, 2021
Capital Projects Total
Non-Major
East Area New River Governmental
Facilities Plan Corsair, LLC Grants Funds
REVENUES:

Intergovernmental $ $ $ 147,128 $ 5,883,935
Charges for services 2,727,178
Use of money and property 929 46,970
Other .revenues 7,844
Total revenues 929 147,128 8,665,927
EXPENDITURES:

Cunent:

General government 305,516
Public safety 765,338
Public works 3,721,448
Culture and recreation 40,763
Planning and building 4,688
Housing 109,146
Capital outlay 147,128 1,002,645
Debt service:

Principal 1,510,000
Interest and fiscal charges 1,276,550
Total expenditures 147,128 8,736,094

REVENUES OVER
(UNDER) EXPENDITURES 929 (70,167)
OTHER FINANCING SOURCES (USES):

Transfers in 1,590,296
Transfers out (449,100)
Total other financing sources (uses) 1, 141,196
Net change in fund balances 929 1,071,029
FUND BALANCES:

Beginning of year 935,773 20,799,374
End of year $ 936,702 $ $ $ 21,870,403
(Concluded)
123
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124

INTERNAL SERVICE FUNDS
125
City of Calexico
Statement of Net Position
All Internal Service Funds
June 30, 2021
Medical Medical Workers'
Payroll Active Retirees Compensation
ASSETS
Current assets:

Cash and investments $ $ $ 135,000 $
Accounts receivable, net 62,806
Due from other funds 133,517 397,161 347,498 2,018,398
Deposits 125,000
Inventories and prepaid items
Total current assets 196,323 397,161 482,498 2,143,398
Total assets 196,323 397,161 482,498 2,143,398

LIABILITIES
Current liabilities:

Accounts payable 172,643 120,070 34,363 68,769
Accrued payroll 23,680
Claims payable - due within one year 622,000
Total current liabilities 196,323 120,070 34,363 690,769 Noncurrent liabilities:

Claims payable - due in more than one year 1,450,000
Total noncunent liabilities 1,450,000
Total liabilities 196,323 120,070 34,363 2,140,769

NET POSITION
Unrestricted (deficit) 277,091 448,135 2,629
Total net position $ $ 277,091 $ 448,135 $ 2,629
(Continued)
126
City of Calexico
Statement of Net Position (Continued)
All Internal Service Funds
June 30, 2021
General Unemployment
Liability Insurance Total
ASSETS
Current assets:

Cash and investments $ $ $ 135,000
Accounts receivable, net 62,806
Due from other funds 1,565,411 5,508 4,467,493
Deposits 50,000 175,000
Inventories and prepaid items 170,513 170,513
Total current assets 1,785,924 5,508 5,010,812
Total assets 1,785,924 5,508 5,010,812

LIABILITIES
Current liabilities:

Accounts payable 226,568 1,326 623,739
Accrued payroll 23,680
Claims payable - due within one year 1,041,064 1,663,064 Total current liabilities 1,267,632 1,326 2,310,483
Noncurrent liabilities:

Claims payable - due in more than one year 518,000 1,968,000 Total noncurrent liabilities 518,000 1,968,000
Total liabilities 1,785,632 1,326 4,278,483

NET POSITION
Unrestricted (deficit) 292 4,182 732,329
Total net position $ 292 $ 4,182 $ 732,3 29
(Concluded)
127
City of Calexico
Statement of Revenues, Expenses, and Changes in Net Position All Internal Service Funds
For the Year Ended June 30, 2021
Medical Medical Workers'
Payroll Active Retirees Compensation
OPERATING REVENUES:

Charges for services $ $ 2,291,238 $ 1,257,000 $ 1,289,486 Other revenue 366,559 56,620
Total operating revenues 2,657,797 1,313,620 1,289,486
OPERATING EXPENSES:

Material, supplies, and operational expenses 42,665 8,400 89,611 Insurance 224,041
Claim payments 1,591 ,872 549,299 565,045
Claims administration 878,243 265, 111 45,227
Total operating expenses 2,512,780 822,810 923,924
OPERATING INCOME (LOSS) 145,017 490,810 365,562
NONOPERATING REVENUES (EXPENSES):

Investment earnings 383 561 2,244
Total nonoperating revenues (expenses) 383 561 2,244
INCOME (LOSS) BEFORE TRANSFERS 145,400 491 ,371 367,806 TRANSFERS:

Transfers in
Transfers out (ll8,000) (200,000)
Total transfers (118,000) (200,000)
Changes in net position 145,400 373,371 167,806
NET POSITION:

Beginning of year 131,691 74,764 (165,177)
End of year $ $ 277,091 $ 448,135 $ 2,629
(Continued)
128
City of Calexico
Statement of Revenues, Expenses, and Changes in Net Position (Continued) All Internal Service Funds
For the Year Ended June 30, 2021
General Unemployment
Liability Insurance Total
OPERATING REVENUES:

Charges for services $ 947,300 $ 79,754 $ 5,864,778
Other revenue 423, 179
Total operating revenues 947,300 79,754 6,287,957
OPERATING EXPENSES:

Material, supplies, and operational expenses 36,124 176,800 Insurance 453,573 677,614
Claim payments 830,828 11 ,426 3,548,470
Claims administration 31,500 1,220,081
Total operating expenses 1,352,025 11 ,426 5,622,965
OPERA TING INCOME (LOSS) (404,725) 68,328 664,992
NONOPERATING REVENUES (EXPENSES):

Investment earnings 915 70 4,173
Total nonoperating revenues (expenses) 915 70 4,173
INCOME (LOSS) BEFORE TRANSFERS ( 403,810) 68,398 669,165 TRANSFERS:

Transfers in 383,000 383,000
Transfers out (65,000) (383,000)
Total transfers 383,000 (65,000)
Changes in net position (20,810) 3,398 669,165
NET POSITION:

Beginning of year 21,102 784 63,164
End of year $ 292 $ 4,182 $ 732,329
(Concluded)
129
City of Calexico
Statement of Cash Flows
All Internal Service Funds
For the Year Ended June 30, 2021
Medical Medical Workers
Payroll Active Retirees Compensation
CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from users $ $ 2,669,426 $ 1,347,688 $ 1,300,560 Cash payments to suppliers for goods and services (274,883) (895,115) (298,525) (126,681) Cash payments for claims and insurance (1,591,872) (549,299) (656,086) Net cash provided by (used in) operating activities (274,883) 182,439 499,864 517,793

CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES:

Principal paid on noncapital-related debt (363,956)
Cash payments to other funds (133,517) (397,161) (347,498) (917,521) Transfers in
Transfers ont (118,000) (200,000)
Net cash (used in) noncapital
financing activities (133,517) (397,161) ( 465,498) (1 ,481 ,477) CASH FLOWS FROM INVESTING ACTIVITIES:

Interest income 383 561 2,244
Net cash provided by investing activities 383 561 2,244 Net increase (decrease) in cash and cash equivalents (408,400) (214,339) 34,927 (961,440) CASH AND CASH EQUIVALENTS:

Beginning of year 408,400 214,339 100,073 961,440
End of year $ $ $ 135,000 $
(Continued)
130
City of Calexico
Statement of Cash Flows (Continued)
All Internal Service Funds
For the Year Ended June 30, 2021
General Unemployment
Liability Insurance Total
CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from users $ 947,300 $ 79,936 $ 6,344,910 Cash payments to suppliers for goods and services (77,581) (l,672,785) Cash payments for claims and insurance (482,905) (11 ,831) (3 ,291,993) Net cash provided by (used in) operating activities 386,814 68,105 1,380,132

CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES:

Principal paid on noncapital-related debt (479,177) (843, 133) Cash payments to other funds (881 ,970) (5,508) (2,683, 175) Transfers in 383,000 383,000
Transfers out (65,000) (383,000)
Net cash (used in) noncapital
financing activities (978,147) (70,508) (3,526,308)
CASH FLOWS FROM INVESTING ACTIVITIES:

Interest income 915 70 4,173
Net cash provided by investing activities 915 70 4, 173 Net increase (decrease) in cash and cash equivalents (590,418) (2,333) (2, 142,003) CASH AND CASH EQUIVALENTS:

Beginning of year 590,418 2,333 2,277,003
End of year $ $ $ 135,000
(Continued)
131
City of Calexico
Statement of Cash Flows (Continued)
All Internal Service Funds
For the Year Ended June 30, 2021
Medical Medical Workers
Payroll Active Retirees Compensation

RECONCILIATION OF OPERATING INCOME
(LOSS) TO NET CASH PROVIDED
BY OPERATING ACTIVITIES:

Operating income (loss) $ $ 145,017 $ 490,810 $ 365,562 Adjustments to reconcile operating income (loss) to
net cash provided by (used in) operating activities:

Changes in operating assets and liabilities:

Accounts receivable ( 41 ,499) 11,629 34,068 11,074
Inventories and prepaid items
Accounts payable 15,233 25,793 (25,014) 8,157
Accrued payroll (248,6 17)
Claims payable 133,000
Total adjustments (274,883) 37,422 9,054 152,231
Net cash provided by (used in)
operating activities $ (274,883) $ 182,439 $ 499,864 $ 517,793 (Continued)
132
City of Calexico
Statement of Cash Flows (Continued)
All Internal Service Funds
For the Year Ended June 30, 2021

RECONCILIATION OF OPERATING INCOME
(LOSS) TO NET CASH PROVIDED
BY OPERATING ACTIVITIES:

Operating income (loss)
Adjustments to reconcile operating income (loss) to
net cash provided by (used in) operating activities:

Changes in operating assets and liabilities:

Accounts receivable
Inventories and prepaid items
Accounts payable
Accrued payroll
Claims payable
Total adjustments
Net cash provided by (used in)
operating activities
$
$
133
General
Liability
(404,725)
(47,784)
37,827
801,496
791,539
386,814
Unemployment
Insurance
$ 68,328
182
(405)
(223)
$ 68,105
$
$
Total
664,992
15,454
(47,784)
61 ,591
(248,617)
934,496
715, 140
1,380,132
(Concluded)
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134

CUSTODIAL FUNDS
135
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136
ASSETS
Cash and investments
Cash and investments with fiscal agents
Due from other governments
Total assets

LIABILITIES
Accounts payable
Total liabilities

NET POSITION
Restricted for:

Individuals, organizations, and other
governments, as restated
Total Net Position
City of Calexico
Combining Statement of Fiduciary Net Position
Custodial Funds
June 30, 2021
Corsair 2013-1 Hearthstone
Gran Plaza Towncenter 2005-1

CFD CFD CFD
$ 51,595 $ $ 226,041
677,694 411 ,792
13,487
729,289 651 ,320
$ 985 $ $ 3,786
985 3,786
728,304 647,534
$ 728,304 $ $ 647,534
137
Venezia
CFD Total
$ $ 277,636
1,089,486
13,487
1,380,609
$ 4,771
4,771
1,375,838
$ $ 1,375,838
ADDITIONS:

City of Calexico
Combining Statement of Changes in Fiduciary Net Position Custodial Funds
For the Year Ended June 30, 2021
Corsair 2013-1 Hearthstone
Gran Plaza Towncenter 2005-1

CFD CFD CFD
Special assessments for other governments $ 179,983 $ $ 692,129 $ Investment earnings 345 252
Total additions 180,328 692,381
DEDUCTIONS:

Adminish·ation 24,862 8,458 34,61 2
Public safety 131,753
Payments - principal 150,000
Payments - interest 366,400 325,044
Total deductions 541 ,262 8,458 491 ,409
Changes in net position (360,934) (8,458) 200,972
NET POSITION:

Beginning of year, as restated 1,089,238 8,458 446,562
End of year $ 728,304 $ $ 647,534 $
138
Venezia
CFD Total
$ 872,112
597
872,709
22,339 90,271
131 ,753
150,000
691 ,444
22,339 1,063,468
(22,339) (190,759)
22,339 1,566,597
$ 1,375,838
ATTACHMENT NO. 2
Transportation Development Act Article 3 and 8e (Non-Transit), June 30, 2021 and 2020 81211.00100\34500529. l
City of Calexico
Transportation Development Act
Article 3 and Article Se
Calexico, California
Financial Statements
and Independent Auditor's Report
For the Years Ended June 30, 2021 and 2020
THE II
PUNGR_OUP
ACCO U N TA N TS & 1\ DV ISO R. S

City of Calexico
Transportation Development Act - Article 3 and Article 8e For the Years Ended June 30, 2021 and 2020
Table of Contents
Independent Auditors' Report .................................................................................................. ........... .. .. .................... 1 Financial Statements:

Balance Sheets - A1ticle 3 ..................................................................... .. ................ .. .. ...... ...... ............ ..................... 7 Statements of Revenues, Expenditures, and Change in Fund Balance - Article 3 .................................................... S Balance Sheets - Article Se .. .................................................................................................................................. 11 Statements of Revenues, Expenditures, and Change in Fund Balance - A1ticle Se ........................... ...... ............... 12 Notes to the Financial Stateinents ................................................ ....................................... .... .. ... ....... ...... .. ............ 13 Supplementary Information:

Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual for:

Article 3 - For the Year Ended June 30, 2021. ................................................................................................ 19 A1ticle 3 -For the Year Ended June 30, 2020 ................................................................................................. 20 A1ticle Se - For the Year Ended June 30, 2021 ............ ................................................................................... 21 A1ticle Se - For the Year Ended June 30, 2020 ............................................................................................... 22 Report on Internal Control Over Financial Reporting
and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ....................................................................... 23 This page i11te11tio11al/y left blank.
1fil II

PUN GROUP

ACCOUNTANTS & ADVJSORS

INDEPENDENT AUDITORS' REPORT
To the Honorable Mayor and Members of the City Council
of the City of Calexico
Calexico, California
Report on Financial Statements
We have audited the accompanying financial statements of the Transpmtation Development Act (TOA) A1ticle 3 and Article Se Funds (the "TOA Non-Transit Funds") of the City of Calexico, California (the "City") as of and for the years ended June 30, 2021 and 2020, and the related notes to the financial statements, which collectively comprise the TOA Non-Transit Funds' financial statements as listed in the table of contents.

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; this includes 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.

Auditors' Responsibility
Our responsibility is to express opinions on these financial statements based on our audits. We conducted our audits 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.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements 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 entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the TOA Non-Transit Funds of the of the City of Calexico, California, as of June 30, 2021 and 2020, and the respective changes in financial position, for the years then ended in accordance with accounting principles generally accepted in the United States of America.
4660 La Jolla Village Drive, Suite 100, San Diego, California 92122 www.pungroup.cpa
To the Honorable Mayor and Members of the City Council
of the City of Calexico
Calexico, California
Page2
Emphasis of Matter
As described in Note 1, the accompanying financial statements present only the TDA Non-Transit Funds and are not intended to, and do not, present fairly the financial position of the City as of June 30, 2021 and 2020, and the changes in fund balance thereof for the years then ended in conformity with accounting principles generally accepted in the United States of America. Our opinions are not modified with respect to this matter.

Other Matters
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the TDA Non-Transit Funds' financial statements. The Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual are presented for purposes of additional analysis and are not a required patt of the financial statements.

The Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Such information has been subjected to the auditing procedures applied in the audit of the financial statements and ce1tain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the 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 financial statements as a whole.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our repmt dated April 22, 2022 on our consideration of the City's internal control over financial reporting and our tests of its compliance with ce1tain provisions of laws, regulations, contracts, and grant agreements. The purpose of that repmt is 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 internal control over financial repmting or on compliance. That repmt is an integral patt of an audit performed in accordance with Govemment Auditing Standards and should be read in conjunction with this repmt in considering the City's internal control over financial repmting and compliance.

San Diego, California
April 22, 2022
2 FINANCIAL STATEMENTS
3 This page i11te11tio11al(11 left blank.
4 TDA ARTICLE (3)
5 Tit is page i11te11tio11al(l' left blank.
6 ASSETS
Cash and investments
City of Calexico
Transportation Development Act Fund - Article 3
Balance Sheets
June 30, 2021 and 2020
Due from other governmental agencies
Total assets

FUND BALANCE
Fund balance:

Restricted
Total fund balance
Total fund balance
See accompanying Notes to the Financial Statements.
7 $
$
$
$
2021
407,661
21,829
429,490
429,490
429,490
429,490
$
$
$
$
2020
371,996
35,261
407,257
407,257
407,257
407,257
City of Calexico
Transportation Development Act Fund -Article 3
Statements of Revenues, Expenditures, and Change in Fund Balance For the Years Ended June 30, 2021 and 2020
REVENUES:

TDA funds
Use of money and property
Total revenues
EXPENDITURES:

Capital outlay
Total Expenditures

CHANGE IN FUND BALANCE
FUND BALANCE:

Beginning of year
End of year
See accompanying Notes to the Financial Statements.
$
$
8 2021
21,829
404
22,233
22,233
407,257
429,490
$
$
2020
35,261
6,756
42,017
42,017
365,240
407,257
TDA ARTICLE (Se)
9 This page i11te11tio11al(11 left blank.
10 City of Calexico
Transportation Development Act Fund - Article 8e
Balance Sheets
June 30, 2021 and 2020
ASSETS
Cash and investments
Due from other governmental agencies
Total assets

LIABILITIES AND FUND BALANCE
Liabilities:

Accounts payable and accrued liabilities
Accrued payroll
Total liabilities
Fund balance:

Restricted
Total fund balance
Total liabilities and fund balance
See accompanying Notes to the Financial Statements.
11 $
$
$
$
2021
121,501
41 ,963
163,464
340
109
449
163,015
163,015
163,464
$
$
$
$
2020
116,250
42,381
158,631
158,631
158,631
158,631
City of Calexico
Transportation Development Act Fund -Article 8e
Statements of Revenues, Expenditures, and Change in Fund Balance For the Years Ended June 30, 2021and2020
REVENUES:

TOA funds
Use of money and property
Total revenues
EXPENDITURES:

Current expenditures:

Public works
Total Expenditures

REVENUES OVER
(UNDER) EXPENDITURES
OTHER FINANCING SOURCES (USES):

Transfers out
Total other financing sources (uses)

CHANGE IN FUND BALANCE
FUND BALANCE:

Beginning of year
End of year
See accompanying Notes to the Financial Statements.
$
$
12 2021
41 ,963
120
42,083
14,363
14,363
27,720
(23,336)
(23,336)
4,384
158,63 1
163,015
$
$
2020
84,347
1,690
86,037
86,037
72,594
158,631
City of Calexico
Transportation Development Act - Article 3 and Article Se Notes to the Financial Statements
For the Years Ended June 30, 2021 and 2020
Note 1 - Summary of Significant Accounting Policies
The financial statements of the TDA Non-Transit Funds of the City are in conformity with accounting principles generally accepted in the United States of America applicable to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing accounting and financial rep01iing principles. The following is a summary of the more significant accounting policies.

The Reporting Entity
The City was incorporated in April 1908, under the General Laws of the State of California and enjoys all the rights and privileges pe1iaining to such "General Law" cities. It is governed by an elected five-member council.

The financial statements of the Transpo1iation Development Act (TDA) Article 3 and A1iicle 8e Funds (TDA NonTransit Funds) are intended to present the financial position and changes in financial position of only those transactions attributable to the TDA Non-Transit Funds administered and disbursed by the City of Calexico, California (the "City").

Fund Accounting
The accounts of the City are organized on the basis of funds, which are considered to be separate accounting entities.

The operations of the TDA Non-Transit Funds are accounted for in a separate set of self-balancing accounts that comprise its assets, liabilities, fund balance, revenues and expenditures. Government resources are allocated to and for individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The funds represented in the TDA Non-Transit Funds' financial statements are special revenue fund types. The TDA Non-Transit Funds account for the City's share of the TDA A1iicle 3, A1iicle 8a, and Article 8e allocations. The TDA Non-Transit Funds are legally restricted for specific purposes and are included in the financial statements of the City.

Basis of Accounting
The accounting and financial reporting treatment applied to a fund is determined by its measurement focus and basis of accounting. Financial statements for the special revenue fund type of governmental funds are presented using the current financial resources measurement focus and the modified accrual basis of accounting.

Basis of accounting refers to when revenues and the related assets and liabilities are recognized in the accounts and rep01ied in the TDA Non-Transit Funds' financial statements. Specifically, it relates to the timing of measurements made, regardless of the nature of the measurement. Revenues are recognized in the accounting period in which they become measurable and available. Expenditures are recognized in the accounting period in which the fund liability is incurred, if measurable, except for unmatured interest on general long term-liabilities, which is recognized when due.

Additionally, consistent with the flow of "current financial resources" measurement focus required for governmental fund financial statements, unmatured long-term indebtedness are repo1ied as a long-term liability of the City, not as a liability of the fund.

Under the modified accrual basis of accounting, revenues are recorded when susceptible to accrual; that is, when they become both measurable and available to finance expenditures in the fiscal period. "Available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. For the TDA NonTransit Funds, revenues and other governmental fund financial resources are recognized if measurable and collectible generally within 60 days following the end of the fiscal year. Revenues considered susceptible to accrual primarily include TDA A1iicle 3 and Article 8e funds and interest. 13 City of Calexico
Transportation Development Act - Article 3 and Article 8e Notes to the Financial Statements (Continued)
For the Years Ended June 30, 2021 and 2020
Note 1- Summary of Significant Accounting Policies (Continued) Cash and Investments
TDA Non-Transit Funds pool cash resources with all funds in the City in order to facilitate the management of cash and achieve the goal of obtaining the highest yield with the greatest safety and least risk. The balance in the pooled cash account is available to meet current operating requirements. Cash in excess of current requirements is invested in various interest-bearing accounts and other investments for varying terms.

Highly liquid money market investments with maturities of one year or less at time of purchase are stated at ammtized cost. All other investments are stated at fair value. Market value is used as fair value for those securities for which market quotations are readily available.

The City considers amounts in demand deposits and shmt-term investments with a maturity date within three months of the date acquired by the City and are presented as "Cash and Investments" in the accompanying financial statements.

Revenue Recognition
Recognition of revenues arising from non-exchange transactions, which include revenues from taxes, ce1tain grants, and contributions, is based on the primary characteristic from which the revenues are received by the City. Funds allocated under the capital improvements program obtain the characteristic of a voluntary non-exchange transaction similar to a grant.

Unavailable revenues arise when potential revenues do not meet both the "measurable" and "available" criteria for recognition in the current period. Unearned revenues also arise when the City receives resources before it has a legal claim to them, as when grant monies are received prior to the incmrnnce of qualified expenditures. In subsequent periods, when both revenue recognition criteria are met, or when the City has a legal claim to the resources, the liability for unearned revenue is removed from the balance sheet and revenue is recognized.

Budgeta1y Control and Encumbrances
The City adopts an annual budget on a basis consistent with accounting principles generally accepted in the United States of America and utilizes an encumbrance system as a management control technique to assist in controlling expenditures and enforcing revenue provisions. Under this system, the current year expenditures are charged against the budgeted appropriations.

Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect ce1tain repo1ted amounts and disclosures. Accordingly, actual results could differ from those estimates. 14 City of Calexico
Transportation Development Act - Article 3 and Article 8e Notes to the Financial Statements (Continued)
For the Years Ended June 30, 2021 and 2020
Note 1- Summary of Significant Accounting Policies (Continued) Fund Balances
In the governmental fund financial statements, fund balances are classified in the following categories:

Nonspendable Fund Balance - Items that cannot be spent because they are not in spendable form, such as prepaid items and inventories and long-term receivables, or items that are legally or contractually required to be maintained intact, such as principal of an endowment or revolving loan funds Restricted Fund Balance - Restricted fund balances encompass the pottion 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 Fund Balance - Committed fund balances encompass the pottion of net fund resources, the use of which is constrained by limitations imposed by the fotmal action of the government's highest level of decision making authority normally through resolutions, etc., and that remain binding unless rescinded or modified in the same manner. The City Council is considered the highest authority for the City.

Assigned Fund Balance -Assigned fund balances encompass the pottion of net fund resources reflecting the government's intended use ofresources. Assignment ofresources can be done by the highest level of decision making or by a committee or official designated for that purpose. The Finance Director is authorized to determine and define the amount of assigned fund balances.

Unassigned Fund Balance - This amount indicates the po1tion of fund balance that do not fall into one of the above categories.

When expenditures are incurred for purposes for which both restricted and unrestricted fund balances are available, the City's policy is to apply restricted fund balances first, then unrestricted fund balances as they are needed.

When expenditures are incurred for purposes where only unrestricted fund balances are available, the City uses the unrestricted resources in the following order: committed, assigned, and unassigned.

Note 2 - Cash and Investments
The City has pooled its cash and investments in order to achieve a higher return on investments while facilitating management of cash. Cash in excess of current requirements is invested in various interest-bearing accounts and other investments for varying terms. The balance of the TDA Non-Transit Funds' cash, as of June 30, 2021 and 2020, respectively, was as follows:

TDA Article 3
TDA A1iicle Se
2021
$ 407,661
$ 121 ,501
2020
$ 371 ,996
$ 116,250
The TDA Non-Transit Funds' cash is deposited in the City's internal investment pool, which is re potted at fair value.

Interest income is allocated based on average cash balances. Investment policies and associated risk factors applicable to the TDA Non-Transit Funds are those of the City and are included in the City's financial statements. 15 Note 3 - Restrictions
City of Calexico
Transportation Development Act - Article 3 and Article Se Notes to the Financial Statements (Continued)
For the Years Ended June 30, 2021 and 2020
Funds received pursuant to TDA Article 3 may only be used for pedestrian and bicycle projects.

Funds received pursuant to TDA A1ticle 8e may only be used to pay for capital expenses incurred while contracting for transit services with profit making or non-profit companies for public transpmtation services as described in TDA A1ticle Se.

Note 4 - Contingencies
A. Litigation
The City is a defendant in ce1tain legal actions arising in the normal course of operations. Liabilities for the probable amounts of loss associated with these claims are covered through the City's self-insurance and the California State Association of Counties Excess Insurance Authority. The City management believes that the City's insurance programs are sufficient to cover any potential losses should an unfavorable outcome materialize.

B. TDA Non-Transit Funds
The TDA Non-Transit Funds are subject to program compliance audits by the grantors and their representatives.

Any liability for reimbursement which may arise as the result of these audits is not believed to be material.

Note 5 - Pedestrian and Bicycle Projects
The City has planned a bikeway system in conformance with specifications of Caltrans' Planning and Design Criteria for Bikeways in California, and the Regional Transpmtation Plan using funds received pursuant to TDA Article 3. 16 SUPPLEMENTARY INFORMATION
17 This page illte11tio11al/y left blank.
18 City of Calexico
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual TDA Article 3
For the Year Ended June 30, 2021
Variance with
Final Budget
Budgeted Amounts Actual Positive/
Original Final Amounts (Negative)
Fund balance, July 1, 2020 $ 407,257
Resources (inflows):

TDA funds $ 28,980 $ 28,980 21,829 $ (7,151)
Use of money and property 404 404
Amount available for appropriation $ 28,980 $ 28,980 $ 22,233 $ (6,747) Charges to appropriations (outflows):

Capital outlay 416,000 416,000 416,000
Total charges to appropriations 416,000 416,000 416,000 Excess of resources over (under)
charges to appropriations $ (387,020) $ (387,020) 22,233 $ 409,253 Fund balance, June 30, 2021 $ 429,490
19 City of Calexico
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual TDA Article 3
Fund balance, July 1, 2019
Resources (inflows):

TDA funds
Use of money and property
Amount available for appropriation
Charges to appropriations (outflows):

Capital outlay
Total charges to appropriations
Excess of resources over (under)
charges to appropriations
Fund balance, June 30, 2020
For the Year Ended June 30, 2020
Budgeted Amounts
Original Final
$ 35,261 $ 35,261
35,261 35,261
406,000 406,000
406,000 406,000
$ (370,739) $ (370,739)
===========
20 $
$
Actual
Amounts
365,240
35,261
6,756
42,017
42,017
407,257
Variance with
Final Budget
Positive/
(Negative)
$
6,756
6,756
406,000
406,000
$ 412,756
City of Calexico
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual TDA Article Se
Fund balance, July 1, 2019
Resources (inflows):

TDA funds
Use of money and property
Amount available for appropriation
Charges to appropriations (outflows):

CmTent:

Public works
Transfer out
Total charges to appropriations
Excess of resources over (under)
charges to appropriations
Fund balance, June 30, 2020
For the Year Ended June 30, 2021
Budgeted Amounts
Original Final
$ 42,381 $ 42,381
42,381 42,381
52,664 52,664
23,336 23,336
76,000 76,000
$ (33,619) $ (33,619)
21 Variance with
Final Budget
Actual Positive/
Amounts (Negative)
$ 158,631
41,963 $ (418)
120 120
42,083 (298)
14,363 38,301
23,336
37,699 38,301
4,384 $ 38,003
$ 163,015
City of Calexico
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual TDA Article Se
Fund balance, July 1, 2019
Resources (inflows):

TDA funds
Use of money and property
Amount available for appropriation
Charges to appropriations (outflows):

Current:

Public works
Capital outlay
Total charges to appropriations
Excess of resources over (under)
charges to appropriations
Fund balance, June 30, 2020
For the Year Ended June 30, 2020
Budgeted Amounts
Original Final
$ 42,381 $ 42,381
42,381 42,381
49,248 49,248
40,000 40,000
89,248 89,248
$ (46,867) $ ( 46,867)
22 Variance with
Final Budget
Ach1al Positive/
Amounts (Negative)
$ 72,594
84,347 $ 41,966
1,690 1,690
86,037 43,656
49,248
40,000
89,248
86,037 $ 132,904
$ 158,631
THE II
PUNGllOUP

ACCOUNTANTS & ADVISORS

REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND

OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN

ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Independent Auditors' Report
To the Honorable Mayor and Members of the City Council
of the City of Calexico
Calexico, California
We have audited, in accordance with generally accepted auditing standards in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the accompanying financial statements of the Transportation Development Act ("TDA") Article 3 and Article 8e Funds (the "TDA Non-Transit Funds") of the City of Calexico, California (the "City"), as of and for the years ended June 30, 2021 and 2020, and the related notes to the financial statements, which collectively comprise the TDA Non-Transit Funds' financial statements, and have issued our report thereon dated April 22, 2022.

Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the TDA Non-Transit Funds' internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the TDA Non-Transit Funds' internal control. Accordingly, we do not express an opinion on the effectiveness of the TDA Non-Transit Funds' internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet imp01tant enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or, significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

Compliance and Other Matters
As patt of obtaining reasonable assurance about whether the TDA Non-Transit Fund's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed one instance of noncompliance or other matters that are required to be rep01ted under Government Auditing Standards. 4660 La Jolla Village Drive, Suite 100, San Diego, California 92122 www. pungroup.cpa
To the Honorable Mayor and Members of the City Council
of the City of Calexico
Calexico, California
Page2
In connection with our audit referred to above, we also performed an audit for compliance with the Transpo1iation Development Act, the California Code of Regulations, and the rules and regulations and allocation instructions of the Imperial County Transportation Commission, for the year ended June 30, 2021. In connection with our audit, we performed to the extent applicable, the compliance audit tasks set fo1ih in Sections §6666 and §6667 of Title 21, Division 3, Chapter 2, A1ticle 5.5 of the California Code of Regulations. The results of performing the tasks specified above disclosed one instance of noncompliance with the applicable statutes, rules, and regulations of the Act, and the allocation instructions and resolutions of the Imperial County Transportation Commission. In our opinion, the funds allocated to and received by the TDA Non-Transit Funds for the year ended June 30, 2021, pursuant to the Transpmiation Development Act, were accounted for and expended in conformance with the Transpmiation Development Act, the California Code of Regulations, and the rules and regulations and allocation instructions of the Imperial County Transportation Commission.

Finding 2021-01 - Late Submission of Certified Fiscal Audit Criteria:

Pursuant to the ICTC Guidebook for the Transportation Development Act: "Ce1iified Fiscal Audit -The TDA statute requires that all claimants submit a certified fiscal audit annually to their regional transpmiation planning agency and to the State Controller within 180 days after the end of the fiscal year. The fiscal repmi must include the audited amounts for the prior fiscal year."
Condition:

The City has experienced significant delays in the preparation and issuance of 2021 financial statements and completion of their annual fiscal audit required under the Transpmiation Development Act.

Effect:

The City is not in compliance with the requirements of the Transpmiation Development Act.

Recommendation:

The City's Finance Depa1iment should develop standard operating procedures to facilitate monthly and year-end closing processes and the preparation of its financial statements.

Management's Response:

The City concurs with this finding. The Finance staff continues to improve its annual work plan and to focus on staff training in order to accelerate the publication of its annual financial statements.

City's Response to the Findings
City's response to the findings identified in our audit is described previously. City's response was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it. 24 To the Honorable Mayor and Members of the City Council of the City of Calexico
Calexico, California

Purpose of this Report
The purpose of this rep01t is solely to describe the scope of our testing of internal control and compliance and the results of that testing and to express an opinion on the compliance of the TOA Non-Transit Funds with the Transpo1tation Development Act, the California Code of Regulations, and the rules and regulations and allocation instructions of the Imperial County Transpmtation Commission, and not to provide an opinion on the effectiveness of the TOA Non-Transit Funds' internal control or on other compliance. This report is an integral pmt of an audit performed in accordance with Government Auditing Standards in considering the TOA Non-Transit Funds' internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

San Diego, California
April 22, 2022
25 This page i11te11tio11al(v left blank.
26 ATTACHMENT NO. 3
Single Audit, June 2021
8 1211.00100\34500529. 1
City of Calexico
Calexico, Calif omia
Single Audit and
Independent Auditors' Reports
For the Year Ended June 30, 2021
THE II
PUNGR_OUP

ACCO UN TAN TS & AD VISO R S

City of Calexico
Table of Contents
Independent Auditors' Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ................................................................... I Independent Auditors' Report on Compliance for Each Major Federal Program, on Internal Control Over Compliance Required by the Uniform Guidance, and on Schedule of Expenditures of Federal Awards ..................................................................................... 3 Schedule of Expenditures of Federal Awards ............................................................................................................ 5 Notes to the Schedule of Expenditures ofFederal Awards ..................................................... ... ..... ........................... 6 Schedule of Findings and Questioned Costs ............. ....... ............................................................. ......... .................... 7 Summary of Prior Audit Findings Status ................................................................................................................... 8 This page i11te11tio11ally left blank
THE II

PUN GROUP
ACCOUNTANTS & ADVISOR.S

REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND

OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS

PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Independent Auditors' Report
To the Honorable Mayor and Members of the City Council
of the City of Calexico
Calexico, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Calexico, California (the "City"), as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the City's basic financial statements, and have issued our repmt thereon dated April 22, 2022.

Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City's internal control over financial reporting ("internal control") as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly, we do not express an opinion on the effectiveness of the City's internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the City's financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet impmtant enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or, significant deficiencies.

Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

Compliance and Other Matters
As pait of obtaining reasonable assurance about whether the City's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be repmted under Government Auditing Standards. 4660 La Jolla Village Drive, Suite 100, San Diego, California 92122 www. pungroup.cpa
To the Honorable Mayor and Members of City Council
of the City of Calexico
Calexico, California

Purpose of this Report
The purpose of this rep mt is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City's internal control or on compliance. This report is an integral pmt of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

San Diego, California
April 22, 2022
2 1ill II

PUN GROUP

ACCOUNTANTS & ADVISORS
REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM;
REPORT ON INTERNAL CONTROL OVER COMPLIANCE; AND REPORT ON SCHEDULE OF

EXPENDITURES OF FEDERAL AW ARDS REQUIRED BY THE UNIFORM GUIDANCE Independent Auditors' Report
To the Honorable Mayor and Members of City Council
of the City of Calexico
Calexico, California
Report on Compliance for Each Major Federal Program
We have audited the City of Calexico, California's (the "City") compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of the City's major federal programs for the year ended June 30, 2021. The City's major federal programs are identified in the summary of the auditor's results section of the accompanying schedule of findings and questioned costs.

Management's Responsibility
Management is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs.

Auditors' Responsibility
Our responsibility is to express an opinion on compliance for each of the City's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; the audit requirements of Title 2 US. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occutTed. An audit includes examining, on a test basis, evidence about the City's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances.

We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program.

However, our audit does not provide a legal determination of the City's compliance.

Opinion on Each Major Federal Program
In our opinion, the City complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2021. 4660 La Jolla Village Drive, Suite 100, San Diego, California 92122 www.pungroup.cpa
To the Honorable Mayor and Members of City Council
of the City of Calexico
Calexico, California