Calimesa City Council
December 19, 2022

Regular Meeting of the Calimesa City Council
Monday, December 19, 2022

CALL TO ORDER
ROLL CALL: MAYOR DAVIS, MAYOR PRO TEM HEWITT, COUNCIL MEMBER CERVANTEZ, COUNCIL MEMBER MANLY AND COUNCIL MEMBER MOLINA.

STAFF: CITY MANAGER KOLBOW, CITY ATTORNEY BARROW, CITY CLERK

GERDES, FINANCE DIRECTOR REID, PLANNING DIRECTOR LUCIA, PUBLIC

WORKS ENGINEER SHAKIR, CITY ENGINEER THORNTON, FIRE CHIEF O’CONNELL AND SHERIFF CAPTAIN SALAS.

PLEDGE OF ALLEGIANCE
PRESENTATIONS – Swearing In of Citizen on Patrol Member Michael Susnar – Mayor Davis Regular Meeting of the Calimesa City Council
Meeting Agenda
Monday, December 19, 2022 – 6:00 p.m.

Norton Younglove Multipurpose Senior Center
908 Park Avenue, Calimesa, CA 92320
William Davis, Mayor  Wendy Hewitt, Mayor Pro Tem
Jeff Cervantez, Council Member  John Manly, Council Member  Linda Molina, Council Member Will Kolbow, City Manager  Quinn Barrow, City Attorney The Calimesa City Council will be conducting this meeting in the Norton Younglove Senior Center. Members of the public may participate in this meeting in one of two ways:
1) In person at the Norton Younglove Senior Center, 908 Park Avenue, Calimesa, CA 92320. 2) By viewing the meeting on Facebook Live, beginning at 6:00 p.m. at https://www.facebook.com/cityof.calimesa Submission of Public Comments: If attending the meeting, public comment will be allowed by completing a speaker slip and providing it to the City Clerk at the meeting. Please observe a time limit of three (3) minutes when giving your presentation. When called upon, please step forward to the microphone, state your name for the record, whom you represent and any statement you wish to make. Please be advised that you may not defer your three (3) minutes to another speaker. Otherwise, public comment will be accepted via email. Please send comments via email to the Calimesa City Clerk at [email protected]. Identify public comment or the specific agenda item you wish to comment on in your email’s subject line. You may submit comments on any agenda item. Emailed comments must be submitted by 5:30 p.m. on Monday, December 19, 2022 and will be read into the record by the City Clerk. Electronic comments on agenda items may only be submitted via email and comments via text and social media (Facebook, Twitter, etc.) will not be accepted.

In compliance with the Americans with Disabilities Act, if you need special assistance to participate in a City meeting or other services offered by this City, please contact the City Clerk’s Office, (909) 795-9801. Notification of at least 48 hours prior to the meeting or time when services are needed will assist the City staff in assuring that reasonable arrangements can be made to provide accessibility to the meeting or service. Any public writings distributed by the City to at least a majority of the Council Members regarding any item on this regular meeting agenda will be made available at the public counter at City Hall located at 908 Park Avenue, Calimesa, CA 92320.

Regular Meeting of the Calimesa City Council
Monday, December 19, 2022

COMMUNICATIONS FROM THE PUBLIC
Anyone wishing to address the Council on any item within the Council’s jurisdiction that is not on the agenda may do so at this time. This is not a time for City Council discussion of non-agenda items. After receiving public comments, Council Members, or staff, after being recognized by the Mayor, may briefly respond to statements made by the public or questions posed by the public. In addition, Council Members may ask questions for clarification or make a referral to staff for factual information to be reported back to the Council at a later meeting.

APPROVAL OF THE AGENDA
RECOMMENDATION: Move to approve the agenda
Motion________________________ Second_______________________ Vote___________________________ CONSENT CALENDAR (Items 1 – 8)
The following Consent Calendar items are expected to be routine and non-controversial. Council will act upon them at one time without discussion. Any Council Member or staff member may request removal of an item from the Consent Calendar for discussion.

1. APPROVAL OF CITY COUNCIL ACTION MINUTES.
a) City Council action minutes of a regular meeting of December 5, 2022

2. RECEIVE AND FILE CITY COMMISSION & BOARD MINUTES.
a) Planning Commission minutes of a regular meeting of August 22, 2022

3. APPROVAL OF WARRANT REGISTERS.
a) Check Register Report with a total of $117,349.79 (Check Nos. 39580 to 39629) b) December 1, 2022 Council Payroll of $1,673.25
December 8, 2022 Payroll of $93,505.18

4. WAIVE FULL READING OF ANY PROPOSED ORDINANCES ON THE AGENDA.

This permits reading the title only in lieu of reciting the entire text of the Ordinances. This does not take policy action on the Ordinances or approve or disapprove any Ordinances on the agenda.

5. COUNCIL TRAVEL EXPENSES
RECOMMENDATION: That the City Council move to approve the Council Travel Training and Meeting/Mileage Expenses Report through November 30 2022.

6. APPROVAL AND ADOPTION OF RESOLUTION NO. 2022-76 APPOINTING A

REPRESENTATIVE AND ALTERNATE REPRESENTATIVE TO THE CIRA BOARD OF DIRECTORS.

RECOMMENDATION: That the City Council adopt Resolution No. 2022-76, A Resolution of the City Council of the City of Calimesa California to appoint a representative and an alternate representative to the California Intergovernmental Risk Authority [CIRA] Board of Directors and rescinding Resolution No. 2015-36 in its entirety.

7. PROCUREMENT CARD POLICY, USER AGREEMENT CITY PROCUREMENT CARD AND PROCUREMENT CARD USE FORMS.

RECOMMENDATION: That the City Council approve the Procurement Card Policy and related forms, User Agreement City Procurement Card, Procurement Card Use Form, and Procurement Card Use Form – Missing Receipt, effective February 1, 2023..

Regular Meeting of the Calimesa City Council
Monday, December 19, 2022

8. RECEIVE AND FILE THE FISCAL YEAR 2021-22 ANNUAL AUDITED FINANCIAL STATEMENTS AND RELATED REPORTS.

RECOMMENDATION: That the City Council receive and file the Fiscal Year 2021-22 Annual Audit Report and Financial Statements, the Report on Internal Control over Financial Reporting and Compliance and other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards, the Independent Accountants’ Report on Agreed Upon Procedures Applied to Appropriations Limit Schedule for the year ending June 30, 2023, and the Auditors’ Communication with Those Charged with Governance (SAS 114).

CHAMBER OF COMMERCE REPORTS

POLICE CHIEF COMMENTS & REPORTS

FIRE CHIEF COMMENTS & REPORTS

MAYOR & COUNCIL MEMBER REPORTING OF COUNTY & REGIONAL MEETINGS This is the time for comments, announcements and/or reports on meetings attended at public expense as required by AB 1234.

PUBLIC HEARINGS
The order of business for the Public Hearing shall be:

Open Public Hearing
Staff Presentation
Applicant/Representative Presentation
Public Testimony
Applicant Rebuttal (if necessary)
Public Testimony Closed
Close Public Hearing
Council Discussion
Council Motion and Vote
Speakers are encouraged to be brief and remain within the established time limit of three (3) minutes per speaker. Once the public hearing has been closed, no further testimony will be taken.

9. PUBLIC HEARING – AN ORDINANCE OF THE CITY OF CALIMESA ADOPTING BY REFERENCE THE 2022 EDITIONS OF THE CALIFORNIA FIRE CODE WITH CERTAIN AMENDMENTS THERETO AND AMENDING TITLE 15 OF THE CALIMESA MUNICIPAL CODE REGARDING THE SAME.

RECOMMENDATION: That the City Council open the public hearing, take public testimony, and approve second reading, by title only, adopting Ordinance No.387 - AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CALIMESA ADOPTING BY REFERENCE THE 2022 EDITIONS OF THE CALIFORNIA FIRE CODE WITH CERTAIN AMENDMENTS THERETO AND AMENDING TITLE 15 OF THE CALIMESA MUNICIPAL CODE REGARDING THE SAME.

10. CONTINUED PUBLIC HEARING TO CONSIDER APPEAL OF THE PLANNING COMMISSION’S CONDITIONS OF APPROVAL FOR DEVELOPMENT PLAN REVIEW 22-03 – APPROVAL TO RELOCATE SOUTH MESA WATER COMPANY WELL NO. 11 AND REPLACE APPROXIMATELY 24,533 LINEAR FEET OF WATER MAIN LINES AND RELATED

APPURTENANCES

Regular Meeting of the Calimesa City Council
Monday, December 19, 2022

RECOMMENDATION: That the City Council conduct the public hearing and adopt Resolution No. 2022-75, A Resolution of the City Council of the City of Calimesa, California approving Development Plan Review 22-03 to relocate South Mesa Water Company Well No. 11 and replace approximately 24,533 linear feet of water main lines and related appurtenances within County Line Road from approximately I-10 eastbound off-ramp to Douglas Place, and approving an addendum to the initial study/mitigated negative declaration completed for the County Line Road Transportation Corridor Project (sch#2019109030), pursuant to CEQA Guidelines Sections 15162 through 15164, to be located on .12 acres at the southwest corner of County Line Road and Calimesa Boulevard at APN: 411-080-005 within the Downtown Village Commercial and Calimesa Creek Overlay Zone Area (well relocation) and within existing road right of way (pipeline replacement).

BUSINESS ITEMS

11. CITY COMMISSION APPOINTMENTS.

RECOMMENDATION:

1. That Council Member Cervantez and Council Member Manly each appoint one member to the Library Commission and that the City Council ratify the appointments by a majority vote and adopt Resolution No. 2022-77 providing for appointments made.

2. That Council Member Cervantez, Council Member Hewitt and Council Member Manly each appoint one member to the Parks, Trails & Community Services Commission and that the City Council ratify the appointments by a majority vote and adopt Resolution No. 2022-78 providing for appointments made.

3. That Council Member Cervantez and Council Member Manly each appoint one member to the Planning Commission and that the City Council ratify the appointments by a majority vote and adopt Resolution No. 2022-79 providing for appointments made.

12. CITY COUNCIL REGIONAL ORGANIZATION APPOINTMENTS.

RECOMMENDATION: That the City Council review the Council Regional Organization Assignments list and that the Mayor determine and assign the 2022-2023 representatives.

13. ORDINANCE ADOPTING BY REFERENCE THE 2022 EDITIONS OF THE CALIFORNIA

BUILDING, RESIDENTIAL, ELECTRICAL, MECHANICAL, PLUMBING, ENERGY,

HISTORICAL BUILDING, EXISTING BUILDING AND GREEN BUILDING STANDARDS CODES, WHICH ARE CODIFIED IN TITLE 24 OF THE CALIFORNIA CODE OF REGULATIONS, AND THE 2021 EDITION OF THE INTERNATIONAL PROPERTY

MAINTENANCE CODE, WITH APPENDICES THERETO, INCLUDING AMENDMENTS, ADDITIONS AND DELETIONS; AND AMENDING TITLE 15 OF THE CALIMESA MUNICIPAL CODE..

RECOMMENDATION: That the City Council

1. Introduce First Reading, by title only of Ordinance No. 389 - AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CALIMESA, CALIFORNIA, ADOPTING BY REFERENCE THE 2022

EDITIONS OF THE CALIFORNIA BUILDING, RESIDENTIAL, ELECTRICAL, MECHANICAL,

PLUMBING, ENERGY, HISTORICAL BUILDING, EXISTING BUILDING AND GREEN BUILDING STANDARDS CODES, WHICH ARE CODIFIED IN TITLE 24 OF THE CALIFORNIA CODE OF

Regular Meeting of the Calimesa City Council
Monday, December 19, 2022

REGULATIONS, AND THE 2021 EDITION OF THE INTERNATIONAL PROPERTY

MAINTENANCE CODE, WITH APPENDICES THERETO, INCLUDING AMENDMENTS, ADDITIONS AND DELETIONS; AND AMENDING TITLE 15 OF THE CALIMESA MUNICIPAL CODE.

2. Set a Public Hearing for January 17, 2023 to conduct second reading of Ordinance No. 389..

COUNCIL MEMBERS’ COMMENTS & REPORTS
This is the time for additional general comments, announcements, reports on meetings attended at public expense as required by AB 1234, requests of staff, and other issues of concern to Council Members may be presented briefly at this time. The Council may not legally take action on any item presented at this time other than to direct staff to investigate a complaint or place an item on a future agenda unless (1) by a majority vote, the Council determines that an emergency situation exists, as defined by Government Code § 54956.5 or (2) by a four-fifths vote, the Council determines that there is a need for immediate action and the need for action arose subsequent to the agenda being posted as required by Government Code § 54954.2(b).

CITY MANAGER COMMENTS & REPORTS

CLOSED SESSION ITEMS
A. CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATION Significant Exposure to Litigation pursuant to paragraph (2) of subdivision (d) of Government Code Section 54956.9 – Number of Cases: One (1) case

ADJOURNMENT
Adjourn to the Regular Meeting of the City Council on Tuesday, January 17, 2023 at 6:00 p.m.

City Council Meeting
Agenda Report
Agenda Item No. 1
SUBJECT: APPROVAL OF CITY COUNCIL MEETING MINUTES
MEETING DATE: December 19, 2022
PREPARED BY: Darlene Gerdes, Deputy City Manager/City Clerk RECOMMENDATION: That the City Council approve the action minutes as presented for the Regular City Council Meeting of December 5, 2022.

ATTACHMENTS:

Attachment A: City Council action minutes of December 5, 2022 regular meeting.

City Council Meeting
Agenda Report
Agenda Item No. 2
SUBJECT: APPROVAL OF COMMISSION MEETING MINUTES
MEETING DATE: December 19, 2022
PREPARED BY: Darlene Gerdes, Deputy City Manager/City Clerk RECOMMENDATION: That the City Council approve the action minutes as presented for the August 22, 2022 Planning Commission special meeting.

ATTACHMENTS:

Attachment A: Planning Commission action minutes of August 22, 2022 special meeting.

City Council Meeting
Agenda Report
Agenda Item No. 3
SUBJECT: APPROVAL OF WARRANT REGISTER
MEETING DATE: December 19, 2022
PREPARED BY: Celeste Reid, Finance Director
RECOMMENDATION: That the City Council approve the Warrant Register as presented.

SUMMARY: The attached Check Register Report for City Council’s approval is as follows:
a) Check Register Report with a total of $117,349.79 (Check Nos. 39580-39629) b) December 1, 2022 Council Payroll of $1,673.25
December 8, 2022 Payroll of $93,505.18

City Council Meeting
Agenda Report
Agenda Item No. 4
SUBJECT: WAIVE FULL READING OF ANY PROPOSED ORDINANCES ON

THE AGENDA
MEETING DATE: December 19, 2022
PREPARED BY: Darlene Gerdes, Deputy City Manager/City Clerk This permits reading the title only in lieu of reciting the entire text of the ordinances. This does not take
policy action on the Ordinances or approve or
disapprove any Ordinances on the agenda.

City Council Meeting
Agenda Report
Agenda Item No. 5
SUBJECT: COUNCIL TRAVEL, TRAINING AND MEETING/MILEAGE

EXPENSES
MEETING DATE: December 19, 2022
PREPARED BY: Darlene Gerdes, Deputy City Manager/City Clerk RECOMMENDATION: That the City Council approve the Council Travel, Training and Meeting/Mileage Expenses Report through November 30, 2022.

ATTACHMENTS:

Attachment A: Council Travel, Training and Meeting/Mileage Expenses Report through November 30, 2022.

FISCAL YEAR 2022-23

COUNCIL TRAVEL AND MEETING/MILEAGE EXPENSES
ATTACHMENT 5A
MEETING/MILEAGE 01-1100-7590

DATE DESCRIPTION AMOUNT DATE DESCRIPTION AMOUNT
August 18th Yucaipa State of the City $ 55.00
TOTAL TRAVEL/TRAINING $ - TOTAL MEETING/MILEAGE $ 55.00 REMAINING BALANCE $ 1,450.00 REMAINING BALANCE $ 545.00 MEETING/MILEAGE 01-1100-7590

DATE DESCRIPTION AMOUNT DATE DESCRIPTION AMOUNT
August 18th Yucaipa State of the City $ 55.00
TOTAL TRAVEL/TRAINING $ - TOTAL MEETING/MILEAGE $ 55.00 REMAINING BALANCE $ 1,450.00 REMAINING BALANCE $ 545.00

JEFF CERVANTEZ TRAVEL - MEETING/MILEAGE EXPENSES
TRAVEL/TRAINING 01-1100-7585

WENDY HEWITT TRAVEL - MEETING/MILEAGE EXPENSES
TRAVEL/TRAINING 01-1100-7585

FISCAL YEAR 2022-23

COUNCIL TRAVEL AND MEETING/MILEAGE EXPENSES
ATTACHMENT 5A
MEETING/MILEAGE 01-1100-7590

DATE DESCRIPTION AMOUNT DATE DESCRIPTION AMOUNT
TOTAL TRAVEL/TRAINING $ - TOTAL MEETING/MILEAGE $ -
REMAINING BALANCE $ 1,900.00 REMAINING BALANCE $ 600.00 MEETING/MILEAGE 01-1100-7590

DATE DESCRIPTION AMOUNT DATE DESCRIPTION AMOUNT
Sep 7-9 LOCC Conference Hotel Residence Inn $ 608.16 August 18th Yucaipa State of the City $ 55.00 9-Sep LOCC Conf. Division Lunch $ 50.00 24-Sep Beaumont State of the City $ 65.00 TOTAL TRAVEL/TRAINING $ 658.16 TOTAL MEETING/MILEAGE $ 120.00 REMAINING BALANCE $ 791.84 REMAINING BALANCE $ 480.00

LINDA MOLINA TRAVEL - MEETING/MILEAGE EXPENSES
TRAVEL/TRAINING 01-1100-7585

BILL DAVIS TRAVEL - MEETING/MILEAGE EXPENSES
TRAVEL/TRAINING 01-1100-7585

FISCAL YEAR 2022-23

COUNCIL TRAVEL AND MEETING/MILEAGE EXPENSES
ATTACHMENT 5A
MEETING/MILEAGE 01-1100-7590

DATE DESCRIPTION AMOUNT DATE DESCRIPTION AMOUNT
Sep 7-9 LOCC Conference Hotel Westin $ 605.42 18-Aug Yucaipa State of the City $ 55.00 Sep 7-9 LOCC Conference Parking $ 15.00 24-Sep Beaumont State of the City $ 65.00 Sep 7-9 LOCC Conference Vehicle Fuel $ 31.21
TOTAL TRAVEL/TRAINING $ 651.63 TOTAL MEETING/MILEAGE $ 120.00 REMAINING BALANCE $ 798.37 REMAINING BALANCE $ 480.00

WYNONA DUVALL TRAVEL - MEETING/MILEAGE EXPENSES
TRAVEL/TRAINING 01-1100-7585

City Council Meeting
Agenda Report
Agenda Item No. 6
SUBJECT: APPROVAL AND ADOPTION OF RESOLUTION NO. 2022-76

APPOINTING A REPRESENTATIVE AND ALTERNATE

REPRESENTATIVE TO THE CIRA BOARD OF DIRECTORS
MEETING DATE: December 19, 2022
PREPARED BY: Darlene Gerdes, Deputy City Manager/City Clerk RECOMMENDATION: That the City Council adopt Resolution No. 2022-76, A Resolution of the City Council of the City of Calimesa California to appoint a representative and an alternate representative to the California Intergovernmental Risk Authority [CIRA] Board of Directors and rescinding Resolution No. 2015-36 in its entirety.

BACKGROUND: At the November 2, 2020 meeting, Council adopted the Joint Powers Agreement and Bylaws for the California Intergovernmental Risk Authority [CIRA], which permitted the merger or joining of the Public Agency Risk Sharing Authority of California [PARSAC] and the Redwood Empire Municipal Insurance Fund [REMIF] and therefore, effective July 1, 2021 PARSAC became known as the California Intergovernmental Risk Authority [CIRA]. The Joint Powers Agreement requires that each member entity appoint a representative and an alternate representative to the Board of Directors who will serve without compensation by the Authority.

Prior to the merger and at the September 8, 2015 meeting, Council adopted Resolution No. 2015- 36 appointing Deputy City Manager/City Clerk Gerdes as the representative and City Manager Bonnie Johnson as the alternate representative to the PARSAC Board of Directors. As a result of Bonnie’s retirement, a new alternate member needs to be appointed. Deputy City Manager/City Clerk Gerdes and City Manager Kolbow are recommending that Deputy City Manager/City Clerk Gerdes continue to serve as the representative and City Manager Kolbow serve as the alternate representative.

Staff is therefore requesting that Council adopt Resolution No. 2022-76, providing for the appointment of Deputy City Manager/City Clerk Gerdes as the representative and City Manager Kolbow as the alternate representative to the CIRA Board of Directors. Once adopted a certified copy of the Resolution will be provided to CIRA.

ATTACHMENTS:

Attachment A: Resolution No. 2022-76

RESOLUTION NO. 2022-76

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CALIMESA,

CALIFORNIA TO APPOINT A REPRESENTATIVE TO THE CALIFORNIA INTERGOVERNMENTAL RISK AUTHORITY [CIRA] BOARD OF
DIRECTORS AND RESCINDING RESOLUTION NO. 2015-36 IN ITS
ENTIRETY.

WHEREAS, the City of Calimesa (the “City”) is a party to the Revised and Restated Joint Powers Agreement creating the California Intergovernmental Risk Authority, dated July 1, 2021 (the “Joint Powers Agreement”) and, as such, is a Member Agency of the California Intergovernmental Risk Authority of California (“CIRA”), as that term is defined in the Joint Powers Agreement; and
WHEREAS, pursuant to the Joint Powers Agreement, each Member Agency of CIRA is required to appoint representatives of the City to act on its behalf as if the City itself were present and acting on the CIRA Board of Directors for all matters which come before such Board of Directors, and also for the Director to be eligible for serving on the CIRA Executive Committee; and
WHEREAS the Bylaws of CIRA further require the City appoint its representatives by resolution identifying a Board Director and an Alternate Director to act in the Director’s absence, which may be employees, elected officials, or a combination of both.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Calimesa hereby appoints Deputy City Manager/City Clerk, Darlene Gerdes to serve as its Director on the CIRA Board of Directors to act on behalf of the City; and appoints City Manager Will Kolbow to serve as Alternate Director in the absence of the Director.

BE IT FURTHER RESOLVED that the City Manager, or a designee, be instructed to inform the Secretary of CIRA of the above appointment by sending a certified copy of this Resolution to CIRA’s business office.

PASSED, APPROVED and ADOPTED this 19th day of December, 2022. _________________________________

WILLIAM DAVIS, MAYOR
ATTEST:
___________________________________

DARLENE GERDES, CITY CLERK

Attachment 6A
City Council Meeting
Agenda Report
Agenda Item No. 7
SUBJECT: PROCUREMENT CARD POLICY, USER AGREEMENT CITY

PROCUREMENT CARD AND PROCUREMENT CARD USE
FORMS
MEETING DATE: December 19, 2022
PREPARED BY: Celeste Reid, Finance Director and Treasurer RECOMMENDATION: That the City Council approve the Procurement Card Policy and related forms, User Agreement City Procurement Card, Procurement Card Use Form, and Procurement Card Use Form – Missing Receipt, effective February 1, 2023.

BACKGROUND: On September 19, 2022, the City Council approved the transition from a Small Business Banking credit card agreement to a Purchase Card agreement (hereinafter referred to as Procurement Card), a Public Sector Group Program Agreement with Bank of America, and an increase in City credit limit from $25,000 to $50,000. Full implementation to the new Procurement Card system is expected to be completed by February 1, 2023. An update in policy is recommended given the change in credit card structure from Small Business Banking credit cards to a Procurement Card system.

DISCUSSION: The City’s current Purchasing Policy addresses credit card management. This new and comprehensive Procurement Card Policy will complement the Purchasing Policy. The Procurement Card Policy details requirements including dollar credit limits, authorizes a process for changes to credit limits when needed to conduct City operations, authorizes positions and classifications of employees to be assigned and/or use procurement cards, and includes restrictions of use of the procurement cards with examples of prohibited use. The Procurement Card Policy also outlines responsibilities of cardholders, approvers, and administrators of the program to ensure proper internal controls and oversight. It is important to note that procurement cards are not intended to replace procurement planning and purchases that must be made in accordance with the City’s Purchasing Policy.

There are additional forms recommended to accompany the new Procurement Card Policy including a User Agreement which requires signature from employees and elected officials using a procurement card and receipt submittal forms which require the signatures of Department Directors for purchases made with a procurement card.

Staff respectfully recommends the City Council approve the Procurement Card Policy and related forms with an effective date of February 1, 2023.

FISCAL IMPACT: There is no fiscal impact with the approval of the Procurement Card Policy and related forms.

ATTACHMENTS:

Attachment A: Procurement Card Policy
Attachment B: User Agreement City Procurement Card
Attachment C: Procurement Card Use Form
Attachment D: Procurement Card Use Form – Missing Receipt

City Procurement Cards Policy
City of Calimesa
Purpose, Overview and Scope of this Policy
The purpose of this policy is to establish a framework for appropriate use of procurement cards. This policy applies to all employees who are issued a City of Calimesa procurement card and all departments who authorize employees to use city procurement Cards.

A procurement card is a city issued credit card from a financial institution. The procurement card shall be used as an option for purchases to support the operational needs of the City of Calimesa. The preferred method of payment management is through an invoice and check issuance process. However, the procurement card provides a purchasing option given the scope of commerce and purchasing transactions through online retailers as well as immediate needs to be purchased through retail services.

Policy
Procurement cards may be issued to a designated individual’s name as assigned through position held and/or departments with the City of Calimesa. The city procurement card is to be used for official city business only and may not be used for personal purchases under any circumstances. Failure to follow this policy, including any outlined procedures for procurement card purchases contained in this policy, may lead to the suspension or termination of a procurement card and disciplinary action in accordance with Human Resource policies and personnel rules. Reimbursement to the City by the employee for the unauthorized charges is mandatory.

The Finance Director and the Accounting Technician will be the procurement card Administrators and will serve as primary contacts for the financial institution issuing procurement cards and administration of the procurement card program.

All users of procurement cards will be required to certify they have read, understand, and will comply with this policy. Individuals and Department Directors/Managers who are in possession of the procurement cards are responsible for safeguarding and ensuring the use of the procurement card for official City business.

Attachment 7A
Authorized Users of City Procurement Card
Employees and elected officials may be authorized to receive procurement cards issued in their name for City-related purchases. The City at the time of this policy has a collective monthly purchasing limit of $50,000. This policy acknowledges there may be a state of emergency or operational need to adjust the maximum limits to procurement cards.

Accordingly, the City Manager or Finance Director may adjust maximum limits; however, in no event shall any one card ever be granted a limit in excess of the overall City limit of $50,000. The chart below is an overview of issued cards and standardized and recommended card limits.

The Department Director of department only issued cards shall evaluate the operational necessity for issuance of procurement cards to department employees based on the duties and responsibilities of employees and operational purchasing needs. To determine the operational necessity, departments shall take into consideration frequency of purchases, types of purchases (materials, equipment, supplies, services), and anticipated purchasing limits. The Department Director is responsible and accountable for adherence to this policy for department cardholders and maintenance of appropriate internal controls.

Established
Position/Department Limit
Elected Officials
Mayor $ 1,000.00
Mayor ProTem $ 1,000.00
Council Member $ 500.00
Council Member $ 500.00
Council Member $ 500.00
Employees
City Manager $ 5,000.00
Deputy City Manager $ 7,000.00
Fire Chief $ 5,000.00
Maintenance Supervisor $ 5,000.00
Department Only
Administration $ 7,500.00
Public Works $ 7,500.00
Battalion Chief 1 $ 1,500.00
Battalion Chief 2 $ 1,500.00
Battalion Chief 3 $ 1,500.00
Fire Department Strike Team 1 $ 2,500.00
Fire Department Strike Team 2 $ 2,500.00
Total $ 50,000.00

Safeguarding Procurement Cards
Individuals in possession of procurement cards are responsible for keeping the cards in locked or otherwise safely stored areas. Procurement cards should not be stored or kept in locked vehicles. Elected officials and department cards will be safely secured by the Finance and Fire Departments. If there is a need for use of the procurement card, elected officials, department directors or employee designees may contact the Finance Director, Fire Department Chief or Accounting Technician.

Use of Procurement Cards
Use of the procurement card is not intended to replace procurement planning and purchases that must be made in accordance with the Calimesa Municipal Code Chapter

3.15 and in accordance with other established policies including purchasing, personnel rules and travel policies. Use of the procurement card will meet the following conditions:
a. The procurement card may be used for travel related expenses in accordance with approved travel pursuant to the established personnel rules and travel policy.
b. If a purchase will exceed authorized individual spending limits or department limitations, approval of the purchase must follow standards and requirements of the City’s overall purchasing policy.
c. Procurement Cardholders shall purchase the least expensive item that meets performance specifications and applicable policies.
d. Purchases shall not be split to circumvent purchasing policy limits. e. All procurement card transactions shall be documented with the appropriate credit card receipts, invoices, packing slips, etc. and returned to the Finance Department within five days of purchase. If transaction documentation is lost, a Missing Receipt Form shall be completed.

Prohibitions
The following are prohibitions that apply to the usage of the procurement card including, but not limited to:
a. Non-City business.
b. Use of procurement card by any other person than the Procurement Cardholder or Department Director employee designee.
c. Cash advances.
d. Purchase of flowers or gifts of personal nature for fellow employees. e. Purchase of alcohol.

Emergency Exceptions
Emergency Operations Center (EOC) - In the event of a declared emergencies, the City Manager or Finance Director, or their designee, may authorize an increase in credit card limits and individual transaction limits as well as authorize procurement cards to be temporarily re-assigned to designated staff. The procurement cardholder whose procurement card was temporarily reassigned, shall provide a memorandum explaining reasons for activation of the EOC with the monthly statement of account and affirm the procurement card was temporarily reassigned in accordance with this policy. All receipts must be submitted in accordance with this policy.

Public Safety Event – During Public Safety events (e.g.: hostage/barricade, events, special event police coverage, fire or casualty incidents, etc.), where sworn personnel are held over or unable to leave the site, the Fire Chief, or designee is authorized to temporarily reassign procurement cards for emergency purchases such as food, water, barricades, or other supplies. The procurement cardholder whose procurement card was temporarily reassigned, shall provide a memorandum explaining public safety event and affirm the procurement card was temporarily assigned in accordance with this policy. All receipts must be submitted in accordance with this policy.

Procurement Card Monthly Statements
Each month the Finance Department receives a procurement card statement of activity which details all charges made during the month. The following procedures will be followed:
a. A copy of each individual statement is given to each cardholder. b. Individual cardholders are responsible for keeping receipts. c. Receipts are to be attached to the monthly statement. d. Individual cardholders are to complete a Procurement Card Use Form for each purchase that includes an account code and provide an explanation of the purchase.
e. If a receipt is missing, the cardholder must complete a Procurement Card Use Form – Missing Receipt and provide an explanation as to the reason for loss of receipt.

Responsibilities
Cardholder Responsibilities
Responsibilities of a procurement cardholder include, but are not limited to:
a. Acknowledge receipt of the procurement card and understanding the Procurement Card Policy by completing the User Agreement City Procurement Card Form.
b. Direct questions about the proper use of the procurement card to the City Manager, Finance Director, or Department Director.

c. Use the procurement Card for transactions which relate to official City purchases. Violations of city policies or nonofficial purchases are prohibited d. Ensure purchases are not split to avoid procurement card transaction or purchasing limits.
e. Retain proper possession of the card. There will not be an unauthorized assignment or loan of the procurement card unless specifically authorized by this policy or the City Manager.
f. Ensure the procurement card is secure from theft and misuse. g. Return the procurement card upon request from the City Manager, Finance Director, or Accounting Technician.
h. Notify the Finance Director, or Accounting Technician immediately if the procurement card is lost or stolen.
i. Verify the amount on the sales receipt corresponds to the items purchased, including applicable taxes, before signing the sales receipt. j. Ensure the merchant provides an itemized receipt, which includes a description of the goods and/or services purchased, the quantity purchased, the price per item, amount of sales tax, total amount, shipping charges (if applicable), and date of purchase.
k. Keep records of the invoice or packing slip, and credit card slip for each procurement card transaction until submitting these documents to the Finance Department.
l. Dispute charges, as appropriate, with the financial institution. m. Ensure all documentation supporting each transaction, including a document disputing charges, if applicable is attached to the monthly Statement of Account.
n. Record appropriate account codes with a description of each transaction. o. Identify, if applicable, transactions that require accrual of California Sales and Use Tax to the Finance Department.

Department Director Responsibilities
a. Evaluate the operational necessity for issuance of procurement cards to Department employees based on the duties and responsibilities of employees and the operational requirement.
b. Confirm the adherence to this policy for Department cardholders. c. Confirm the maintenance of appropriate internal controls. d. Review and approve all Monthly Statement of Accounts for department cardholders ensuring that cardholders’ procurement card Monthly Statement of Account includes the appropriate documentation to support transactions. e. Review the utilization of the procurement cards on a periodic basis for the purpose of identifying procurement cards that may no longer be needed or under-utilized.
f. Review Cardholder transactions for split purchases attempting to avoid transaction limits, purchases that are not for City use, inappropriate purchases, and purchases in violation of City policy.
g. Follow appropriate disciplinary measures for violations of this policy. h. Report violations of this policy to the City Manager and/or Finance Director.

Finance Director and Program Administrator of Procurement Cards Responsibilities a. Will not have a procurement card issued in his/her name. b. Maintain and review City Procurement Card Policy.
c. Esablish and update procurement card accounts including termination with the financial institution for procurements cards assigned to elected officials or employees no longer with the City.
d. Administer dollar limits and transaction templates, which limit the utilization of procurement cards.
e. Review Monthly Statement of Accounts to verify the adherence to this policy and ensuring that cardholders’ procurement card Monthly Statement of Account includes the appropriate documentation to support transactions. a. Confirm the maintenance of appropriate internal controls. b. Provide training and advising to procurement cardholders. c. Review procurement cardholder transactions for split purchases attempting to avoid transaction limits, purchases that are not for City use, inappropriate purchases, and purchases in violation of any City policy. d. Follow appropriate disciplinary measures for violations of this policy. e. Report violations of this policy to the City Manager and/or Department Director. f. Confirm termination with the financial institution of procurement cards for cardholders who are no longer employed or an elected official with the City.

Finance Department Designee/Accounts Payable Responsibilities a. Confirm Monthly Statement of Accounts are sent out to procurement cardholders on a timely basis.
b. Provide training to procurement cardholders.
c. Review cardholder transactions for split purchases attempting to avoid transaction limits, purchases that are not for City use, inappropriate purchases, and purchases in violation of any City policy.
d. Confirm each procurement card transaction is assigned a code on the Monthly Statement of Account and charges for accrual of California Sales and Use Tax are identified.
e. Issue payments for procurement cards to the appropriate financial institution. f. Report any violations of this policy to the City Manager and/or Finance Director. g. Review and approve the Monthly Statement of Account of the City Manager ensuring that Cardholder’s Procurement Card Monthly Statement of Account includes the appropriate documentation to support transactions.

City Manager Responsibilities
a. Review and approve all Monthly Statement of Accounts for Department Directors ensuring that Cardholders’ Procurement Card Monthly Statement of Account includes the appropriate documentation to support transactions. b. Review cardholder transactions for split purchases attempting to avoid transaction limits, purchases that are not for City use, inappropriate purchases, and purchases in violation of any City policy.

c. Follow appropriate disciplinary measures for violations of this policy. d. Report violations of this policy to the Finance Director and/or Department Director.

Attachments
a. User Agreement City Procurement Card
b. Procurement Card Use Form
c. Procurement Card Use Form – Missing Receipt
Effective Date of Policy – February 1, 2023

USER AGREEMENT FOR CITY-ISSUED

PROCUREMENT CARD
City of Calimesa

USER AGREEMENT FOR CITY-ISSUED PROCUREMENT CARD
The following user agreement must be signed by all authorized employees of the City of Calimesa with access to a Procurement Card.

I understand that the City of Calimesa has authorized my use of a City Procurement Card for authorized business expenditures on behalf the City of Calimesa. In accepting and/or using the card, I agree to be bound by the terms and conditions which follow. • I will use the card issued to me only for the payment of authorized expenses consistent with my departments responsibilities and to satisfy department and City needs. • I understand all purchases with my City-issued Procurement Card must be made in accordance with Calimesa Municipal Code Chapter 3.15 purchasing. • I will not use the card to obtain cash advances.
• I understand that I am the only authorized card user. • I will not use the card for personal use or for any other non-City purposes. • I understand that all purchases shall be made in accordance with applicable purchasing, travel, and credit card policies and/or procedures in place and/or adopted by the City Council.
• I understand that I will be responsible for the timely reconciliation of all Procurement Card transactions charged to my card.
• I understand that I am responsible to provide appropriate documentation for Procurement Card transactions charged to be card.
• I will surrender the card to the Finance Director, or designee, in the event of my transfer within or separation from the City.
• I understand that any charges against the Procurement Card that are not properly identified or not allowed by the City shall be paid by me by check, currency, or salary deduction in US dollars. I further understand that any employee who has been issued a Procurement Card shall not use the card if any disallowed charges are outstanding and shall surrender the card upon demand of the City Manager, Finance Director, Department Director, or designee.
• I will immediately report any stolen or lost card to the Finance Director or designee. • I will immediately report a stolen or lost card to the Bank at the following number:
1-800-344-5696
Please identify card as a Visa Cal Card

Attachment 7B
I understand that any variance and/or violation of the above conditions will result in cancellation of my credit card. Misuse of the card could result in disciplinary action and/or personal liability for unapproved charges.

All City Procurement Card purchases are subject to examination by external auditors.

The City shall have unlimited authority to revoke use of any Procurement Card issued and upon such revocation shall not be liable for any cost subsequently charged to the Procurement Card.

I certify I have received, read, and understand Policy P-FI-0012 Issuance and Use of City Procurement Cards.

I HAVE READ AND I UNDERSTAND THE ABOVE CONDITIONS.

Name
Department
Last 4 Digits of Credit Card
Signature
Date

PROCUREMENT CARD USE FORM

CITY OF CALIMESA

WHO MADE THE

PURCHASE
VENDOR

DATE OF PURCHASE

DESCRIPTION OF

PURCHASE

AMOUNT OF PURCHASE

ACCOUNT CODING

SUPERVISOR APPROVAL
Procurement Card Conditions of Use:

The City Procurement Card is to be used for official City business and may not be used for personal purchases under any circumstances. Failure to follow the City Council Procurement Card Policy may lead to the suspension or termination of a procurement card and disciplinary action. Reimbursement to the City by the employee for the unauthorized charges is mandatory.

The Procurement Card Use Form must be completed immediately after purchase is made.

Form must be filled out completely with receipt attached and submitted to Accounts Payable for processing.

Attachment 7C

PROCUREMENT CARD USE FORM

MISSING RECEIPT

CITY OF CALIMESA

WHO MADE THE

PURCHASE
VENDOR

DATE OF PURCHASE

DESCRIPTION OF

PURCHASE

AMOUNT OF PURCHASE

ACCOUNT CODING

SUPERVISOR APPROVAL
Procurement Card Conditions of Use:

The City Procurement Card is to be used for official City business and may not be used for personal purchases under any circumstances. Failure to follow the City Council Procurement Card Policy may lead to the suspension or termination of a procurement card and disciplinary action. Reimbursement to the City by the employee for the unauthorized charges is mandatory.

The Procurement Card Use Form must be completed immediately after purchase is made.

Form must be filled out completely and submitted to Accounts Payable for processing.

Provide an explanation for missing receipt:

Attachment 7D

CITY COUNCIL MEETING

AGENDA REPORT
Agenda Item No. 8
SUBJECT: RECEIVE AND FILE THE FISCAL YEAR 2021-22 ANNUAL

AUDITED FINANCIAL STATEMENTS AND RELATED REPORTS
MEETING DATE: December 19, 2022
PREPARED BY: Celeste Reid, Finance Director and Treasurer RECOMMENDATION: That City Council receive and file the Fiscal Year 2021-22 Annual Audit Report and Financial Statements, the Report on Internal Control over Financial Reporting and Compliance and other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards, the Independent Accountants’ Report on Agreed Upon Procedures Applied to Appropriations Limit Schedule for the year ending June 30, 2023, and the Auditors’ Communication with Those Charged with Governance (SAS 114).

DISCUSSION: The firm of Badawi & Associates performs the annual financial audit of the City of Calimesa. This audit is required to be performed in accordance with generally accepted accounting principles and Government Auditing Standards. At the conclusion of the audit test work, the audit firm issues an opinion as to the fairness of presentation of the financial position of City activities, each major fund, and the aggregate remaining fund information of the City.

The City of Calimesa received an unmodified, or “clean”, opinion on its basic financial statements. This indicates that in the auditor’s opinion, the information reported in the financial statements is presented fairly in all material respects. In addition, the audit firm is also required to issue a report related to internal controls, a report related to the annual Appropriations (Gann) Limit calculation, as well as communicate with the Council on certain matters regarding how the audit was planned and conducted (SAS 114 report). All aforementioned reports are attached.

The Report on Internal Control over Financial Reporting and Compliance and other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards identifies matters that should be addressed by the City. There were no items noted in this report.

On December 12, 2022, Mr. Desai, the audit partner, met with the City’s Finance Committee and presented the attached reports. This staff report disseminates the information to the full City Council. The reports will be made available to the public on the City’s website by December 31, 2022.

A review of fiscal information through June 30, 2022 and the City’s updated financial information for Fiscal Year 2022-23 will be provided at the mid-year budget review in February 2023.

FISCAL IMPACT: There is no fiscal impact associated with the recommended action.

ATTACHMENTS:

Attachment A: Annual Audit Report and Financial Statements for the year ended June 30, 2022 and Report on Internal Control over Financial Reporting and Compliance and other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards (see final 2 pages of Attachment A)
Attachment B: Independent Accountants’ Report on Agreed Upon Procedures Applied to Appropriations Limit Schedule for the year ending June 30, 2023
Attachment C: Auditors’ Communication with Those Charged with Governance (SAS 114) for the year ended June 30, 2022

City of Calimesa
Calimesa, California
Annual Audit Report and Financial
Statements
For the year ended June 30, 2022

Attachment 8A

City of Calimesa
Annual Audit Report and Financial Statements
For the year ended June 30, 2022
Table of Contents
Page

INTRODUCTORY SECTION
Table of Contents ........................................................................................................................................................i

FINANCIAL SECTION
Independent Auditor’s Report ...............................................................................................................................1 Management Discussion and Analysis.................................................................................................................5 Basic Financial Statements:

Government-Wide Financial Statements:

Statement of Net Position..............................................................................................................................21 Statement of Activities...................................................................................................................................22 Fund Financial Statements:

Governmental Fund Financial Statements:

Balance Sheet ...............................................................................................................................................26 Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position..........................................................................28 Statement of Revenues, Expenditures and Changes in Fund Balances ..............................................30 Reconciliation of the Governmental Statement of Revenues, Expenditures, and Changes in Fund Balances to the Government-Wide Statement of Activities ............................................................................................................................32 Fiduciary Fund Financial Statements:

Statement of Fiduciary Net Position ........................................................................................................34 Statement of Changes in Fiduciary Net Position....................................................................................35 Notes to Basic Financial Statements...................................................................................................................39 Required Supplementary Information:

Defined Benefit Pension Plan..............................................................................................................................64 Schedule of the Agency’s Proportionate Share of the Net Pension Liability – Last 10 Years.................64 Schedule of Contributions – Last 10 Years.....................................................................................................66 Budgetary Information ........................................................................................................................................69 Schedule of Revenues, Expenditures and Changes in Fund Balances:

General Fund – Budgetary basis ..................................................................................................................70 Measure A Fund – Budgetary basis.............................................................................................................71 Mitigation Fees Special Revenue Fund – Budgetary basis.......................................................................72 ARPA Special Revenue Fund – Budgetary basis.......................................................................................73

City of Calimesa
Annual Audit Report and Financial Statements
For the year ended June 30, 2022
Table of Contents, Continued
Page
Supplementary Information:

Non-Major Governmental Funds:

Combining Balance Sheet.................................................................................................................................76 Combining Statement of Revenues, Expenditures and Changes in Fund Balances ................................78 Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget and Actual:

Special Law Enforcement Grant Special Revenue Fund ..........................................................................80 Housing Rehab – State ..................................................................................................................................81 Library Special Revenue Fund .....................................................................................................................82 Transportation Air Quality Improvement Special Revenue Fund..........................................................83 Gas Tax Special Revenue Fund....................................................................................................................84 Lighting/Landscape District Special Revenue Fund................................................................................85 Recycling Special Revenue Fund .................................................................................................................86 Housing Rehab – Federal .............................................................................................................................87 Road Maintenance and Rehab Special Revenue Fund..............................................................................88 Planning Grants Special Revenue Fund......................................................................................................89 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 .......................................................................................................................91

INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and Members of the City Council
of the City of Calimesa
Calimesa, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the City of Calimesa, California (City), as of and for the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.

In our opinion, the accompanying financial statements present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2022, and the respective changes in financial position thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Responsibilities of Management for the Financial Statements The City’s management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.

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

Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with GAAS, we:
 Exercise professional judgment and maintain professional skepticism throughout the audit.  Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
 Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed.5  Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
 Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control–related matters that we identified during the audit.
2

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

Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, pension schedules and budgetary comparison information on pages 5-15 and 64-73 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements.

We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The combining and individual nonmajor fund financial statements and budgetary comparison schedules of nonmajor governmental funds are presented for purposes of additional analysis and are not a required part of the basic financial statements.

The combining and individual nonmajor fund financial statements and budgetary comparison schedules of nonmajor governmental funds are the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. 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 other budgetary comparison schedules, combining and individual nonmajor fund financial statements, and budgetary comparison schedules of nonmajor governmental funds are fairly stated, in all material respects, in relation to the basic financial statements as a whole.
3

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

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

Badawi and Associates, CPAs
Berkeley, California
November 22, 2022
4

City of Calimesa
Management’s Discussion and Analysis
For the year ended June 30, 2022
This section provides the reader a narrative introduction and a readily understandable analytical overview of the City of Calimesa’s (City) financial activities and performance for the fiscal year ended June 30, 2022.

Summary reports showing comparisons of current financial information with that of the previous year are included to enhance the clarity and usefulness of the reports. To gain a broad perspective of the City and its financial activities, we encourage the reader to consider the information presented here in conjunction with the information that we have provided in the letter of transmittal presented at the beginning of this report.

FINANCIAL HIGHLIGHTS
 At June 30, 2022, the City assets and deferred outflows of resources exceeded its liabilities and deferred inflows of resources by $45.5 million. Approximately 48% of this amount is invested in capital assets (net of related debt) and therefore not available to meet the City’s ongoing operations.  During the fiscal year, the City’s net position increased by $4 million.  At June 30, 2022, the City’s governmental funds reported combined ending fund balance of $24.4 million, an increase of $1.9 million compared to prior fiscal year.  At June 30, 2022, the City’s general fund reported ending fund balance of $8.7 million, an increase of $1.3 million compared to prior fiscal year.

OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis are intended to serve as an introduction to the City’s basic financial statements, which consists of three components: 1) Government-Wide Financial Statements, 2) Fund Financial Statements, and 3) Notes to Basic Financial Statements. Required Supplementary Information is included in addition to the basic financial statements.

Government-Wide Financial Statements
The Government-Wide Financial Statements provide a broad view of the City’s financial position and activities, in a manner similar to private-sector business reporting. The Government-Wide Financial Statements include the Statement of Net Position and the Statement of Activities.

The Statement of Net Position presents information on all of the City’s assets, deferred outflows of resources, liabilities, and deferred inflows of resources with the differences reported as Net Position. This statement reports all assets, deferred outflows of resources, liabilities, and deferred inflows of resources using the accrual basis of accounting. Increases and decreases in Net Position serve as useful indicator of whether the financial position of the City is improving or deteriorating.

The Statement of Activities provides information on how the City’s Net Position changed during the fiscal year. All changes in Net Position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of the related cash flows. All revenues earned and expenses incurred during the fiscal year are reported in this statement, regardless of timing of related cash flows. 5

City of Calimesa
Management’s Discussion and Analysis
For the year ended June 30, 2022
OVERVIEW OF THE FINANCIAL STATEMENTS, Continued
Government-Wide Financial Statements, Continued
The Government-Wide Financial Statements present governmental activities only because the City does not have business-type activities. The governmental activities of the City include general government, public safety, public works, community services and development, parks and recreation, and library. Property and local taxes, investment earnings, charges for services, operating and grants and contributions finance these activities.

Fund Financial Statements
Funds are groupings of related accounts that are used to maintain control over resources that have been segregated for specific activities or objectives. The City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. The funds of the City can be divided into two categories:
governmental funds and fiduciary funds.

Governmental Fund Financial Statements are used to report basically the same functions as governmental activities in the Government-Wide Financial Statements. However, unlike the Government-Wide Financial Statements, Governmental Fund Financial Statements focus on near-term inflows and outflows of spendable resources, as well as the available balances of spendable resources at the end of the fiscal year. This information may be useful in assessing the City’s near-term financial requirements.

To better understand the City’s long-term and near-term financial requirements, it is useful to compare the information presented for governmental funds with the information provided for governmental activities in the Government-Wide Financial Statements. Both the governmental funds balance sheet and statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate the comparison between governmental funds and governmental activities.

The City reports 15 governmental funds. The major governmental funds are the General Fund, Measure A Fund, Mitigation Fees Fund and American Rescue Plan Act (ARPA) Special Revenue Fund, which are presented separately in the Governmental Fund Financial Statements. Information on the other governmental funds is combined into a single aggregated presentation as non-major governmental funds.

Individual fund data for each non-major governmental fund is provided in the form of combining statements as supplementary information elsewhere in the report.

Fiduciary funds are used to account for resources held for the benefit of parties external to the City. These funds are not included in the Government-Wide Financial Statements because the resources of the fiduciary funds are not available to support the City’s own programs. The City’s Fiduciary Fund Financial Statements provide financial information about the activities of the Special Assessment Districts, for which the City acts solely as an agent. The City’s fiduciary funds are presented as an agency fund that accounts for the aggregate activity in the City’s Community Facilities Districts (CFD), as well as a private purpose trust fund to account for the activity of the Successor Agency to the City.
6

City of Calimesa
Management’s Discussion and Analysis
For the year ended June 30, 2022
OVERVIEW OF THE FINANCIAL STATEMENTS, Continued
Notes to Basic Financial Statements
The Notes to Basic Financial Statements provide additional information that is essential to a full understanding of the data provided in the Government-Wide and Fund Financial Statements.

Supplementary Information
The Required Supplementary Information includes budgetary comparison schedules for the General Fund, Measure A Fund and the Mitigation Fees Fund.

Combining and individual fund statements and schedules provide information for non-major governmental funds and are presented immediately following the Required Supplementary Information.

GOVERNMENT-WIDE FINANCIAL ANALYSIS
The following table shows the condensed comparative Statement of Net Position for the fiscal years ended June 30, 2022 and 2021.

Comparative Statements of Net Position
June 30, 2022 and 2021
Governmental Activities
2022 2021
Assets: Cash and investments $ 26,133,590 $ 23,066,416
Other assets 4,374,162 2,583,006
Capital assets, net 22,341,317 20,267,720
Total Assets 52,849,069 45,917,142
Deferred Outflows of Resources Deferred outflow - pension contribution 156,867 131,048 Deferred outflow - pension related amounts 117,093 144,331 Total Deferred Outflows of Resources 273,960 275,379
Liabilities: Long-term liabilities 1,017,996 1,533,873
Other liabilities 6,129,790 3,108,961
Total Liabilities 7,147,786 4,642,834
Deferred Inflows of Resources Deferred inflow - pension related amounts 448,904 69,032 Total Deferred Inflows of Resources 448,904 69,032
Net Position: Net Investment in Capital Assets 22,078,839 19,966,119 Restricted 15,555,294 14,935,222
Unrestricted 7,892,206 6,579,314
Total Net Position $ 45,526,339 $ 41,480,655
7

City of Calimesa
Management’s Discussion and Analysis
For the year ended June 30, 2022
GOVERNMENT-WIDE FINANCIAL ANALYSIS, Continued
Net Position may serve over time as a useful indicator of the City’s financial position. The City’s assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $45.5 million. This is an increase of $4.0 million or 10% over the prior fiscal year. The reasons for this increase are detailed below in the Comparative Statements of Activities and Changes in Net Position.

The largest portion of the City’s Net Position, $22 million, or 48%, is investment in capital assets. The City uses these capital assets to provide services to residents; consequently, they are not available for future spending. There is outstanding debt of $262,478 with relation to capital assets.

Another portion of the City’s Net Position, $15.6 million, or 34%, are resources subject to external restrictions and may only be used for the purpose intended by the entities that provided these funds to the City.

The remaining balance of the City’s Net Position of $7.9 million, or 17%, represents unrestricted Net Position, which may be used to finance daily operations without constraints established by debt covenants or other legal requirements.

The City’s cash and investments increased by $3,067,174. 8

City of Calimesa
Management’s Discussion and Analysis
For the year ended June 30, 2022
GOVERNMENT-WIDE FINANCIAL ANALYSIS, Continued
The following table shows the condensed comparative Statements of Activities and Changes in Net Position for the fiscal years ended June 30, 2022 and 2021.

Comparative Statements of Activities and Changes in Net Position June 30, 2022 and 2021
Governmental Activities
2022 2021
Revenues:

Program revenues:

Charges for services $ 1,993,540 $ 2,467,934
Operating grants and contributions 658,374 657,200
Capital grants and contributions 3,057,405 3,350,977
Total program revenues 5,709,319 6,476,111
General revenues:

Taxes:

General property taxes 3,904,944 3,563,079
Sales tax 1,491,164 1,173,073
Motor vehicle in-lieu 1,312,885 1,137,502
Franchise fees 523,468 502,529
Transient occupancy tax 95,675 86,990
Business Licenses 46,853 42,317
Unrestricted investment earnings 93,373 114,902
Unrealized loss on investments (384,192) -
Other 73,657 85,331
Total general revenues 7,157,827 6,705,723
Total Revenues 12,867,146 13,181,834
Expenses:

General government $ 1,660,155 $ 1,820,362
Public safety 4,883,140 4,400,917
Public works 1,129,070 1,029,471
Community development 925,353 904,792
Parks and recreation 200,527 237,755
Library 23,217 21,306
Total Expenses 8,821,462 8,414,603
Increase in net position 4,045,684 4,767,231
Net position - beginning 41,480,655 36,713,424
Net position - ending $ 45,526,339 $ 41,480,655

9

City of Calimesa
Management’s Discussion and Analysis
For the year ended June 30, 2022
GOVERNMENT-WIDE FINANCIAL ANALYSIS, Continued
The City’s expenses totaled $8.8 million in fiscal year 2021-22. These expenses were funded by program revenues of $5.7 million and general revenues of $7.1 million. This resulted in an increase in Net Position of $4.0 million.

Program Revenues – Program Revenues include fees and other specific charges designed to support the costs of programs provided to residents, as well as revenues related to operating activity, capital improvements and new development. Charges for services decreased by $474,394 due to a decrease in development related activity including reduction in revenues for building permits. Operating Grants and Contributions remained consistent with the prior year. Capital grants and contributions decreased by $293,572 due to a decrease in development mitigation fees and development contributions collected in 2021-22. Overall, program revenues decreased by $766,792.

General Revenues – The overall increase from the prior year is approximately $452,103 or 7%. This is primarily due net changes with increases and decreases to revenue categories. Increases include $341,865 or 10% in property taxes, $175,383 or 15% in motor vehicle-lieu taxes, and $318,091 or 27% increase in sales taxes.

Also, there was a steady increase in revenue categories including franchise fees and transient occupancy tax.

Investment earnings decreased with an unrealized loss of $384,192 which was partially offset by interest and dividend earnings of $93,373. It should be noted no material unrealized losses were recognized in the prior year.

Expenses – The overall increase from the prior year is approximately $459,894 million or 5%. The most significant increase resulted from Public Safety of $482,000. This primarily related to the addition of Problem Oriented Police (POP) officer for the community as well as equipment purchased for the fire department to assist with the transition of providing expanded advanced life support services to the community. Other expense categories remained relatively consistent with prior year activity.

FUND FINANCIAL ANALYSIS
Governmental Funds
The City’s governmental funds provide information on short-term inflows, outflows, and balances of spendable resources. This information is useful in evaluating the City’s financing requirements. Unreserved fund balance may serve as a useful measure of the government’s net resources available for spending at the end of fiscal year.

At June 30, 2022, the City’s combined governmental fund balances were $24.4 million, an increase of $2 million, or 9%, over the prior fiscal year. Of this amount, approximately $15.6 million represents restricted fund balance, $2.6 million represents committed fund balance, and $.2 million represents assigned fund balance. The balance represents unassigned fund balance of $6 million. 10 Page 60 of 251
City of Calimesa
Management’s Discussion and Analysis
For the year ended June 30, 2022
FUND FINANCIAL ANALYSIS, Continued
The City’s governmental revenues in fiscal year 2021-22 were $13 million, in total this is relatively consistent with prior year governmental revenues. There were both increases and decreases in all revenue categories.

Significant changes were increases of $1 million from the prior year in property, sales and motor vehicle in lieu taxes. Intergovernmental activity which represents new grant funding and municipal contributions relating to shared capital streets and road improvements has increases of $2 million in the prior year. There were also significant decreases in total of $3 million in development fees including building permits, mitigation fees, and development fee agreements. It should be noted that typically grant funding, municipal contributions and development fees are one-time in nature and subject to timing as development occurs within the City of Calimesa. It is notable that one-time revenue sources received in prior years are being offset in current year activity through reoccurring revenue from property, sales and motor vehicle in lieu taxes.

The City’s governmental expenditures in fiscal year 2021-22 were $11 million, an increase of $1.2 million from fiscal year 2020-21. The overall increase of 12% is comprised of increases in most expenditure categories. The most significant increases include $475,629 in public safety and $692,471 in public works. The City increased public safety expenditures with the Fire Department for advanced life support equipment and Police Department law enforcement community engagement for an additional POP officer. The Public Works Department increased activity relating to streets and road improvements primarily paid through the Mitigation Fee special revenue fund.

The following provides an analysis of the City’s major funds:

General Fund
The General Fund is the primary operating fund of the City. At June 30, 2022, the General Fund had a total fund balance of $8,743,201, which consisted of nonspendable fund balance of $16,364, committed fund balance of $2,196,706 representing amounts set aside by City Council for emergencies and economic stability (calculated as 30% of annual operating expenditures), committed fund balance for equipment replacement (calculated as 5% of annual operating expenditures) $366,117, assigned fund balance for insurance of $127,745, and unassigned fund balance of $6,036,269.

The net change in fiscal 2021-22 fund balance of the City’s General Fund increased by $1,328,226. Revenues exceeded expenditures by $1,420,075, while other financing uses of transfers to other funds resulted in a decrease of $91,849. Revenues decreased by $71,789 and expenditures increased by $488,173 from the prior year.

The decrease in revenues of $71,789, or .8% over prior year was a net effect of increases and decreases throughout all revenue categories. The most significant increases in revenue were approximately, $1 million increase in taxes and $331,871 in charges for services. The most significant decreases in revenue over prior year were $584,603 in licenses and permits, $356,215 in development fees and $384,192 of unrealized investment loss of investments.
11 Page 61 of 251
City of Calimesa
Management’s Discussion and Analysis
For the year ended June 30, 2022
FUND FINANCIAL ANALYSIS, Continued
General Fund, continued
The increase in expenditures of $488,173, or 7% over prior year was due a net effect of increases and decreases in all expenditure categories. The most significant increases in expenditures were $542,735 for public safety and $156,257 for general government. Increases in public safety were attributed to the Fire Department for advanced life support equipment and the Police Department law enforcement community engagement for an additional Problem Oriented Policing (POP) officer. Increases in the general government include staff reclassifications for the city clerk and finance departments and a full year of salaries and benefits of staff for the finance department. The most significant decreases in expenditures were approximately $125,959 in community development and services, $42,755 for public works, and $42,105 for parks and recreation.

Decreases were attributed to expenditure savings in community development building and safety professional services, timing variances in public works with respect to equipment purchases and landscaping services that are anticipated to be used in fiscal year 2022-23, and for the reduced staffing at the Senior Center.

Measure A - Special Revenue Fund
The Measure A Fund accounts for revenue in the form of voter-approved sales tax to be used for street and road purposes. The net change in fiscal year 2021-22 fund balance of the Measure A Fund increased by $285,621. Revenue increased by $59,583 and expenditures decreased by $640,290 over the prior year. The decrease in expenditures relates to significant streets project that were completed in the prior year. The fund balance that is accumulating is restricted for a citywide pavement management program partially funded by Measure A funds.

Mitigation Fees – Special Revenue Fund
The Mitigation Fee Fund accounts for revenue from development impact fees and grants to be used for facilities including street and traffic, storm drain, parks, library, public safety and general government. These fees are used to mitigate the impacts of new development. Activity in the fund will vary from year to year based upon the timing of development moving forward and capital projects managed within the mitigation fee funds. The revenue in this fund is typically collected prior to the issuance of a building permit for new construction and is subject to timing of developments. The expenditures can vary greatly from year to year as city-initiated projects for infrastructure and equipment purchases are moved forward. The net change in fiscal year 2021-22 fund balance of the Mitigation Fee funds increased by $34,672. Revenues decreased over prior year by $426,975 due to variability and timing of development projects. Expenditures increased over prior year by $1,141,410 due to new street and road improvements and capital projects.

ARPA - Special Revenue Fund
The ARPA Fund accounts for revenues received for the American Rescue Plan act for which monies will be used for various eligible purposes. The total amount received by the City in this fiscal year referred to as the first tranche of funding is $1,095,633 and funds are reported as unearned revenue as of June 30, 2022. It is anticipated this first tranche of funding will be utilized for the citywide pavement management program in future fiscal years. This the first year ARPA funding and as such there are no comparisons to be provided to the prior year. The total fund balance as of June 30, 2022 is $1,099,568. 12 Page 62 of 251
City of Calimesa
Management’s Discussion and Analysis
For the year ended June 30, 2022

GENERAL FUND BUDGETARY HIGHLIGHTS
The budgetary comparison schedule for the General Fund is presented in the Required Supplementary Information. The General Fund budget for fiscal year 2021-22 was increased by $881,789 for revenue and $406,225 for expenditures. Budget amendments were a result of changes in actual operating results in revenue categories and in response to services provided throughout the year. Actual revenues were consistent with the final amended budgeted revenues. Actual expenditures for the fiscal year were $960,738 under the amended budget primarily due to savings across all budgetary categories, however, it should be noted a portion of the savings were a result of the lack of availability of materials and equipment. As such, certain appropriations will “rollover” and be re-budgeted to fiscal year 2022-23.

CAPITAL ASSETS AND LONG-TERM OBLIGATIONS
Capital Assets
The City’s capital assets include those assets that are used in the performance of the City’s services. At June 30, 2022, the City’s capital assets used in governmental activities amounted to $22.3 million, net of depreciation.

Capital assets for governmental activities are presented below to illustrate changes from prior fiscal year:

Governmental Activities
2022 2021

Land $ 1,918,401 $ 1,918,401
Construction in Progress 7,668,906 5,251,343
Buildings and Improvements 4,478,993 4,258,214
Infrastructure:

Road Network 13,717,079 13,717,079
Machinery and equipment 1,352,871 1,350,459
Capital assets before depreciation 29,136,250 26,495,496 Less: accumulated depreciation (excludes land) (6,794,933) (6,227,776) Total net capital assets $ 22,341,317 $ 20,267,720
Additional information on capital assets can be found in Note 4 to the Basic Financial Statements. 13 Page 63 of 251
City of Calimesa
Management’s Discussion and Analysis
For the year ended June 30, 2022
Long-term Obligations
At June 30, 2022, the City had long-term debt outstanding of $572,656 compared to $570,401 in the prior year.

The finance purchase agreement was reduced while the compensated absences obligation increased. This resulted in a net increase of $2,255. Additional information on long-term obligations is provided in Note 5 to the Basic Financial Statements.

The City’s long-term debt obligations at June 30, 2022 and 2021 were as follows:

Governmental Activities
2022 2021

Compensated absences $ 310,178 $ 268,800
Finance purchase agreement 262,478 301,601
Total $ 572,656 $ 570,401
Not included in the above total outstanding debt amount is the Successor Agency Trust. At June 30, 2022, there was $2,151,321 bond debt outstanding. Additional information on the Successor Agency Trust is provided in Note 9 to the Basic Financial Statements.

ECONOMIC FACTORS AND NEXT YEAR’S BUDGET
The City’s adopted budget for 2022-23 recognized that:
 The City continues to have planned commercial and residential development projects which result in economic and population growth.
 The adopted budget reflects conservative revenue estimates given variable factors in local economic and inflationary projections and the timing of when planned development will move forward.  The City continues to focus on increasing the tax base, namely, property tax and sales tax, which will be key to sustaining service levels and long-term fiscal stability.  Development will continue to play a major role in fiscal year 2022-23 in the areas of revenue, infrastructure and staffing levels.
 Based on American Rescue Plan Act funds and use of designated reserve funding, the City budgeted one-time expenditures including over $2.2 million for a pavement management program.  The City will be completing several infrastructure and street improvement projects including the County Line corridor improvement plan, City Hall Expansion project and upgrades to the Senior Center and City Facilities to meet ADA compliance standards.  The adopted fiscal year 2022-23 budget projects an approximate 68% General Fund reserve level at June 30, 2023, which is well above the Council approved policy of 30%. 14 Page 64 of 251
City of Calimesa
Management’s Discussion and Analysis
For the year ended June 30, 2022

REQUEST FOR INFORMATION
This financial report is designed to provide residents, taxpayers, customers, investors, and creditors with a general overview of the City’s finances. Questions concerning any information provided in this report or requests for additional information should be addressed to the City of Calimesa, Finance Department, 908 Park Avenue, Calimesa, California 92320.
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BASIC

FINANCIAL STATEMENTS
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18 Page 68 of 251

GOVERNMENT-WIDE

FINANCIAL STATEMENTS
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20 Page 70 of 251
Governmental
Activities
Assets
Cash and investments (Note 2) 26,133,590 $
Receivables:

Taxes and other 686,704
Interest 52,063
Due from the Successor Agency 64,519
Due from other governments 2,405,865
Prepaid expenses 16,364
Note receivable 1,148,647
Capital assets not being depreciated (Note 4) 9,587,307 Capital assets being depreciated, net (Note 4) 12,754,010 Total Assets 52,849,069
Deferred Outflows of Resources
Deferred outflow - pension contribution 156,867
Deferred outflow - pension related amounts 117,093
Total Deferred outflows of resources 273,960
Liabilities
Accounts payable and accrued liabilities 2,381,376
Accrued payroll 76,620
Deposits 2,521,740
Unearned revenue 1,150,054
Noncurrent liabilities:

Due within one year 95,565
Due in more than one year 477,091
Net pension liability 445,340
Total Liabilities 7,147,786
Deferred Inflows of Resources
Deferred inflows - pension related amounts 448,904
Total Deferred inflows of resources 448,904
Net Position
Net investment in capital assets 22,078,839
Restricted:

Legally restricted - Street and Road Improvements 715,038 Regulatory/grant restrictions 2,494,064
Legally restricted - Dev. Impact fees 12,346,192
Unrestricted 7,892,206
Total Net Position $ 45,526,339
City of Calimesa
Statement of Net Position
June 30, 2022
See accompanying Notes to Basic Financial Statements.
21 Page 71 of 251
Net (Expense)
Revenue and
Changes in
Net Position
Charges Operating Capital
for Grants and Grants and Governmental
Functions/Programs: Expenses Services Contributions Contributions Total Activities Primary Government:

Governmental activities:

General government 1,660,155 $ 826,046 $ - $ $ 826,046 - $ $ (834,109) Public safety 4,883,140 203,960 - 203,960 - (4,679,180) Public works 1,129,070 455,283 456,503 3,057,405 3,969,191 2,840,121 Community services and
development 925,353 508,251 165,797 674,048 - (251,305) Parks and recreation 200,527 - - - - (200,527)
Library 23,217 36,074 - 36,074 - 12,857
Total governmental activities 8,821,462 $ $ 1,993,540 $ 658,374 $ 3,057,405 $ 5,709,319 (3,112,143) General Revenues:

Taxes:

Property 3,904,944
Sales tax 1,491,164
Motor vehicle in-lieu 1,312,885
Franchise fees 523,468
Transient occupancy taxes 95,675
Business Licenses 46,853
Total Taxes 7,374,989
Unrestricted investment earnings 93,373
Unrealized loss on investments (384,192)
Other 73,657
Total general revenues 7,157,827
Change in net position 4,045,684
Net position - beginning of year 41,480,655
Net position - end of year $ 45,526,339
City of Calimesa
Statement of Activities
For the year ended June 30, 2022
Program Revenues
See accompanying Notes to Basic Financial Statements.
22 Page 72 of 251
FUND

FINANCIAL STATEMENTS
Governmental Fund Financial Statements
Fiduciary Fund Financial Statements
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GOVERNMENTAL FUND FINANCIAL STATEMENTS
General Fund accounts for resources traditionally associated with governmental which are not required legally or by sound financial management to be accounted for in another fund.

Measure A Special Revenue Fund accounts for revenue in the form of voter-approved Measure A sales tax to be used for street and road improvements.

Mitigation Fees Special Revenue Fund accounts for various sources of development related revenue including facilities fees, traffic fees, and park acquisition, flood drainage control, and improvement fees. These fees are used to expand facilities as development occurs, thus mitigating a portion of the impacts associated with development.

ARPA Special Revenue Fund accounts for one-time revenues received from the federal government for the America Rescue Plan Act (ARPA), for which monies will be used for various eligible projects. ARPA was passed to provide economic relief to municipal governments.

Non-Major Governmental Funds is the aggregate of all the non-major governmental funds. 25 Page 75 of 251
Measure A Mitigation Fees
General Special Revenue Special Revenue
Assets
Cash and investments 11,027,424 $ 639,426 $ 11,940,005 $ Receivables:

Taxes and other 497,506 - -
Intergovernmental - 76,100 2,279,031
Interest 52,063 - -
Loans - - -
Prepaid expenses 16,364 - -
Due from other funds 158,758 - -
Due from the Successor Agency 64,519 - -
Total assets $ 11,816,634 $ 715,526 $ 14,219,036
Liabilities, Deferred Inflow of Resources,
and Fund Balance
Liabilities:

Accounts payable 479,738 488 1,872,844
Accrued payroll 76,620 - -
Unearned revenues 14,376 - -
Due to other funds - - -
Deposits 2,482,777 - -
Total liabilities 3,053,511 488 1,872,844
Deferred Inflow of Resources:

Unavailable revenues 19,922 - -
Total Deferred inflows of resources 19,922 - -
Fund Balance:

Nonspendable 16,364 - -
Restricted - 715,038 12,346,192
Committed for:

Emergencies and economic stabilization 2,196,706 - -
Equipment replacement 366,117 - -
Assigned for:

Capital projects - - -
Insurance 127,745 - -
Unassigned 6,036,269 - -
Total fund balance 8,743,201 715,038 12,346,192
Total liabilities, deferred inflow of resources
and fund balance $ 11,816,634 $ 715,526 $ 14,219,036
Major Funds
City of Calimesa
Balance Sheet
Governmental Funds
June 30, 2022
See accompanying Notes to Basic Financial Statements.
26 Page 76 of 251
Major Fund Total Nonmajor Total
ARPA Governmental Governmental
Special Revenue Funds Funds
$ 1,427,167 1,099,568 $ 26,133,590 $
- 189,198 686,704
- 50,734 2,405,865
- - 52,063
- 1,148,647 1,148,647
- - 16,364
- - 158,758
- - 64,519
$ 1,099,568 $ 2,815,746 $ 30,666,510
- 28,306 2,381,376
- - 76,620
1,095,633 40,045 1,150,054
- 158,758 158,758
- 38,963 2,521,740
1,095,633 266,072 6,288,548
- - 19,922
- - 19,922
- - 16,364
3,935 2,490,129 15,555,294
- - 2,196,706
- - 366,117
- 59,545 59,545
- - 127,745
- - 6,036,269
3,935 2,549,674 24,358,040
$ 1,099,568 $ 2,815,746 $ 30,666,510
27 Page 77 of 251
Total Fund Balance - Governmental Funds $ 24,358,040
Amounts reported for governmental activities in the statement of net position (page 21) are different because:

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

Capital assets not being depreciated 9,587,307
Capital assets being depreciated, net 12,754,010
Total capital assets 22,341,317
Revenues in the statement of activities that do not provide current financial resources are classified as Deferred Inflows of Resources in the funds. 19,922
Employer contributions for pension were recorded as
expenditures in the governmental funds. However, in the Government-Wide Financial Statement these contributions are deferred. 156,867
In the Government-Wide Financial Statement certain
differences between actuarial estimates and actual results for pension are deferred and amortized over a period of time, however in the governmental funds no transactions are
recorded. (331,811)
Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the funds:

Compensated absences (310,178)
Finance purchase agreement payable (262,478)
Net pension liability (445,340)
Net position of governmental activities $ 45,526,339
City of Calimesa
Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position
June 30, 2022
See accompanying Notes to Basic Financial Statements.
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29 Page 79 of 251
Measure A Mitigation Fees
General Special Revenue Special Revenue
Revenues
Taxes 7,333,567 $ - $ $ -
Licenses and permits 544,310 - -
Fines and forfeitures 42,675 - -
Intergovernmental 161,525 300,718 2,030,017
Charges for services 700,370 - -
Development fees 453,228 - 726,670
Investment earnings 37,593 1,991 45,013
Unrealized loss on investments (384,192) - -
Other 15,908 - -
Total Revenues 8,904,984 302,709 2,801,700
Expenditures
Current:

General government 1,604,307 - 138,826
Public safety 4,624,998 - 9,766
Public works 437,128 17,088 2,553,838
Community services and development 705,994 - -
Parks and recreation 112,482 - 9,796
Library - - 4,453
Debt service:

Principal - - 39,123
Interest and fiscal charges - - 11,226
Total Expenditures 7,484,909 17,088 2,767,028
Excess of Revenues Over Expenditures 1,420,075 285,621 34,672 Other Financing Sources (Uses)
Transfers in - - -
Transfers out (91,849) - -
Total Other Financing Sources (Uses) (91,849) - -
Net Change in Fund Balance 1,328,226 285,621 34,672
Fund Balance - Beginning of year 7,414,975 429,417 12,311,520 Fund Balance - End of year $ 8,743,201 $ 715,038 $ 12,346,192 Major Funds
City of Calimesa
Statements of Revenues, Expenditures, and Changes in Fund Balance For the Year Ended June 30, 2022
See accompanying Notes to Basic Financial Statements.
30 Page 80 of 251
Major Fund Total Nonmajor Total
ARPA Governmental Governmental
Special Revenue Funds Funds
$ - $ 104,584 $ 7,438,151
- - 544,310
- - 42,675
- 837,508 3,329,768
- - 700,370
- - 1,179,898
3,935 4,841 93,373
- - (384,192)
- 16,900 32,808
3,935 963,833 12,977,161
- - 1,743,133
- 144,867 4,779,631
- 411,834 3,419,888
- 185,155 891,149
- - 122,278
- 18,764 23,217
- - 39,123
- - 11,226
- 760,620 11,029,645
3,935 203,213 1,947,516
- 91,849 91,849
- - (91,849)
- 91,849 -
3,935 295,062 1,947,516
- 2,254,612 22,410,524
$ 3,935 $ 2,549,674 $ 24,358,040
31 Page 81 of 251
Net change in fund balance - governmental funds $ 1,947,516 Amounts reported for governmental activities in the statements of activities are different because:

Governmental funds reported additions of capital assets as capital outlay and program expenditures. However, in the Government-Wide Statement of Activities, the cost of those assets was allocated over their estimated useful lives as depreciation expense. This was the amount of capital assets purchased in the current period. 2,794,104 Depreciation expense on capital assets was reported in the Government-Wide Statement of Activities, but they did not require the use of current financial resources. Therefore, depreciation expense was not reported as expenditures in the Governmental Funds. (720,507) Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds. (110,015)
Current year employer pension contributions are recorded as expenditures in the governmental funds, however these amounts are reported as a deferred outflow of resources in the Government-Wide Statement of Net Position. 156,867 Pension expense is recorded as incurred in the Government-Wide Statement of Activities, however pension expense is not recognized in the governmental funds. (20,026) Issuance of long term debt is reported as other financing sources in the governmental funds and this contributes to the change in fund balance. In the Statement of Net Position, however, issuing debt increases long-term liabilities and does not affect the Statement of Activities.

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

Long-term debt repayments 39,123
Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental fund.

In addition, some expenditures recorded in the governmental funds have already been expensed in the government-wide in prior years.
(41,378)
Change in net position of governmental activities $ 4,045,684 For the Year Ended June 30, 2022
City of Calimesa
Reconciliation of the Statements of Revenues, Expenditures, and Changes in Fund Balance of Governmental Funds to the Statements of Activities See accompanying Notes to Basic Financial Statements.
32 Page 82 of 251

FIDUCIARY FUND FINANCIAL STATEMENTS
Custodial Funds account for assets held by the City for unspent special assessments collected for various Community Facility Districts and mitigation fees collected on behalf of Western Riverside County Regional Conservation Authority.

Successor Agency Trust Fund accounts for assets and liabilities transferred from the City to the Successor Agency Trust Fund.

Private Purpose Trust Funds
Custodial Funds
33 Page 83 of 251
City of Calimesa
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2022
Successor
Custodial Agency
Funds Trust Fund
Cash and investments 3,871,689 $ - $
Cash and investments with fiscal agent - restricted 2,068,710 211,492 Receivables:

Assessments 20,203 -
Total assets 5,960,602 211,492
Deferred loss on refunding - 74,389
Total deferred outflows of resources - 74,389
Accounts payable and accrued liabilities 24,983 $ 338
Deposits 20,234 -
Due to City of Calimesa - 64,519
Noncurrent liabilities:

Due within one year - 115,000
Due in more than one year - 2,036,321
Total liabilities 45,217 2,216,178
Restricted
Debt service 5,910,949 211,492
Multiple Species Habitat Conservation Plan 4,436 -
Unrestricted - (2,141,789)
Net position $ 5,915,385 $ (1,930,297)
Assets
Deferred outflows of resources
Liabilities
Net Position
See accompanying Notes to Basic Financial Statements.
34 Page 84 of 251
City of Calimesa
Statement of Changes in Fiduciary Net Position
Fiduciary Fund
For the year ended June 30, 2022
Successor
Custodial Agency
Funds Trust Fund
Additions
Special assessments 2,874,151 $ - $
Redevelopment Property Tax Trust Fund distributions - 294,646 Investment earnings 12,712 177
Fees collected on behalf of other agencies 133,719 -
Miscellaneous 8,871 -
Total additions 3,029,453 294,823
Deductions
Administration 51,297 97,083
Debt service payments 1,261,204 80,791
Bond funds reimbursements - developer 622,468 -
Professional services and financial services 955,142 -
Disbursement of fees to other agencies 134,139 -
Total deductions 3,024,250 177,874
Change in Net Position 5,203 116,949
Net Position - beginning 5,910,182 (2,047,246)
Net Position - ending $ 5,915,385 $ (1,930,297)
See accompanying Notes to Basic Financial Statements.
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36 Page 86 of 251

NOTES TO BASIC

FINANCIAL STATEMENTS
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City of Calimesa
Notes to Basic Financial Statements
For the year ended June 30, 2022

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Description of the reporting entity
The City of Calimesa (the City) was incorporated on December 1, 1990, under the laws of the State of California and enjoys all the rights and privileges applicable to the general law city. It is governed by an elected five-member Council and Council-appointed Mayor. As required by accounting principles generally accepted in the United States of America, these financial statements present the City (the primary government).

B. Government-wide and fund financial statements
The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on the primary government. For the most part, the effect of interfund activity has been removed from these statements.

The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use or directly benefit from goods, services or privileges provided by a given function or segment, and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported as general revenues.

The fund financial statements provide information about the City’s funds. Separate financial statements are provided for governmental funds. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column. All remaining governmental funds are aggregated and reported as nonmajor funds.

The City reports the following major governmental funds:

The General Fund is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in another fund.

The Measure A Special Revenue Fund is used to account for revenue in the form of voter-approved Measure A sales tax to be used for street and road improvements.

The Mitigation Fees Fund is used to account for various sources of development related revenue including facilities fees, traffic fees, flood drainage control, and park acquisition and improvement fees. These fees are used to expand facilities as development occurs, thus mitigating a portion of the impacts associated with development.

The ARPA Special Revenue Fund is used to account for revenue received from the America Rescue Plan Act, to be used for eligible projects.

Additionally, the City reports the following non-major fund types:

The Special Revenue Funds are used to account for and report the proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes other than debt service or capital projects.
39 Page 89 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued B. Government-wide and fund financial statements, Continued The Capital Projects Fund is used to account for and report financial resources that are restricted, committed, or assigned to expenditure for capital outlays. The City’s non-major capital projects fund accounts for projects related to the Americans with Disabilities Act (ADA). Other capital project expenditures are recorded directly in either the General Fund or applicable Special Revenue Funds that serve as the funding sources for each capital project.

Fiduciary Fund Financial Statements
Fiduciary fund financial statements consist of a Statement of Fiduciary Net Position and a Statement of Changes in Fiduciary Net Position. The City has two types of fiduciary funds, Custodial Funds that account for monies collected on behalf of other governmental agencies and Community Facilities Districts, and a Private Purpose Trust Fund, which accounts for the activities of the Successor Agency to the City of Calimesa Redevelopment Agency. Fiduciary funds are accounted for using the accrual basis of accounting.

C. Measurement focus, basis of accounting, and financial presentation The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Non-exchange transactions, in which the City gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, grants, entitlements and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied.

Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the government considers revenues, except for grant revenues to be available if they are collected within 60 days of the end of the current fiscal period. Grant revenues are generally considered available if they are collected within 180 days. Expenditures generally are recorded when a liability is incurred, as under accrual accounting.

As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. Amounts reported as program revenues include 1) charges to members, customers or applicants for goods, services, or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments. Internally dedicated sources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes. In addition, fiduciary funds are not included in the government-wide financial statements.

When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, and then use unrestricted resources as needed. 40 Page 90 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued D. Assets, liabilities and net position or equity
Cash, Cash Equivalents and Investments
The City pools its available cash for investment purposes. The City’s cash and cash equivalents are considered to be cash on hand, demand deposits, and short-term investments with original maturity of three months or less from date of acquisition. Cash and cash equivalents are combined with investments and displayed as Cash and Investments.

In accordance with GASB Statement No. 40, Deposit and Investment Disclosures (Amendment of GASB No. 3), certain disclosure requirements for Deposits and Investment Risks were made in the following areas:
⏹ Interest Rate Risk
⏹ Credit Risk
◻ Overall
◻ Custodial Credit Risk
◻ Concentrations of Credit Risk
In addition, other disclosures are specified including use of certain methods to present deposits and investments, highly sensitive investments, credit quality at year-end and other disclosures.

In accordance with GASB Statement No. 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools, 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.

The City participates in an investment pool managed by the State of California, the Local Agency Investment Fund (LAIF) which has invested a portion of the pooled funds in Structured Notes and Assetbacked Securities. The 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 Assetbacked Securities are subject to market risk as to change in interest rates.

Receivables
During the course of normal operations, the City carries various receivable balances for taxes, interest, services and special assessments. Accounts receivables are shown net of an allowance for doubtful accounts.

Interfund Transactions
Interfund transactions are reflected as loans, reimbursements for services provided or transfers. Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either “due to/from funds” (i.e., the current portion of interfund loans) or “advances to/from other funds” (i.e., the noncurrent portion of interfund loans). 41 Page 91 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued D. Assets, liabilities and net position or equity, Continued Use of estimates
The financial statements have been prepared in accordance with generally accepted accounting principles accepted in the United States of America and necessarily include amounts based on estimates and assumptions by management. Actual results could differ from those amounts.

Unearned revenues
In the fund financial statements, unearned revenues represent cash advances from various entities that have not been spent; therefore, no revenue has been recognized.

Claims and judgments
Only the short-term liability (if any) is reflected as a current liability in all applicable governmental fund types, the remainder of the liability is reported as long-term debt in the statement of net position. The City determined that no liability needs to be accrued for claims and judgments.

Capital assets
Capital assets, which include land, buildings, improvements, equipment, and infrastructure assets (e.g., roads, bridges, sidewalks and similar items), are reported in the applicable governmental columns in the government-wide financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $5,000 ($50,000 for infrastructure assets) and an estimated useful life in excess of three years. Such assets are reported at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value at the date of donation.

The cost of normal maintenance and repairs that do not add to the value of the assets or materially extend lives are not capitalized.

Capital assets of the primary government are depreciated using the straight-line method over the following estimated useful lives:

Assets Years
Buildings 50
Building improvements 25-30
Infrastructure 30-50
Vehicles 3-15
Office equipment 3-7
Computer equipment 3-10
42 Page 92 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued D. Assets, liabilities and net position or equity, Continued Pension Plan
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the City’s California Public Employees’ Retirement System (CalPERS) plan (Plan) and additions to/deductions from the Plan’s fiduciary net position have been determined on the same basis as they are reported by CalPERS.

For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.

In addition, the City also sponsors the City of Calimesa Public Agency Retirement System (PARS) defined Contribution Plan for its fire employees. No assets or liabilities are reported for the PARS plan. Additional information about the City’s pension plans is included in Note 6.

Employee leave benefits
Compensated absences are the amounts due to employees for future absences which are attributed to services already rendered. Vacation pay is payable to employees at the time a vacation is taken or upon separation of employment. Sick leave is payable when an employee is unable to work because of illness.

The vested portion of compensated absences is included as a long-term liability in the statement of net position.

The following are summaries of the City’s compensated leave policies:

Compensatory time
With the exception of a few items, compensatory time is usually payable to the employee upon termination at the rate of pay at separation.

Sick leave
Employees accrue sick leave in accordance with schedules set forth in the City’s Personnel Rules. All employees with at least six months service are allowed to accrue up to 960 hours of sick leave. Employees are not paid upon separation for accrued sick leave, therefore no liability is accrued in these financial statements for sick leave. The City Manager has no limit on sick or vacation accruals. Upon separation, the City Manager’s sick leave is payable at 100%. If retiring, the City Manager can elect conversion to service credit.

Vacation leave
Employees accrue vacation leave in accordance with schedules set forth in the City’s Personnel Rules.

Employees will be paid upon separation all accrued vacation leave up to a maximum of 240 hours. The City Manager has no limit on vacation accruals.
43 Page 93 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued D. Assets, liabilities and net position or equity, Continued Property taxes
The County of Riverside, California, bills and collects the property taxes and remits them to the City in installments during the year. The County is permitted by State Law (Proposition 13) to levy taxes at 1 percent per $100 of full market value (at time of purchase) and can increase the assessed values no more than 2 percent per year. The City receives a share of this basic levy proportionate to what was received in the 1976 to 1978 period.

Property taxes are assessed and collected each fiscal year according to the following property tax calendar:

Net Position
Government-Wide Financial Statements
In the Government-Wide Financial Statements, net position is classified in the following categories:

Net Investment in Capital Assets – This category consists of capital assets net of accumulated depreciation and reduced by outstanding debt that is attributed to the acquisition, construction, or improvement of the assets.

Net Position, Continued
Restricted – This category includes amounts restricted by external creditors, grantors, contributors, or laws or regulations of other governments.

Unrestricted – This category includes amounts that do not meet the definition of “net investment in capital assets” or “restricted net position” as defined above.

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.

Fund Balances
Nonspendable Fund Balance- That portion of fund balance that includes amounts that are either 1) not in a spendable form; or 2) legally or contractually required to be maintained intact. Amounts considered “not in a spendable form” include items that are not expected to be converted to cash such as prepaid items and long-term notes receivable.

Lien Date January 1
Levy Date July 1
Due Date November 1, First Installment
February 1, Second Installment
Collection December 10, First Installment
April 10, Second Installment
44 Page 94 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued D. Assets, liabilities and net position or equity, Continued Fund Balances, Continued
Restricted Fund Balance – That portion of fund balance that reflects constraints placed on the use of resources (other than nonspendable items) that are either 1) externally imposed by creditors, such as through debt covenants, grantors, contributors or the laws and regulations of other governments; or 2) imposed by law through constitutional provisions or enabling legislation. These restrictions may be effectively changed only with the consent of the resource provider.

Committed Fund Balance – That portion of fund balance that includes amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of the City Council, the City’s government’s highest level decision making authority. In order for funds to be considered committed, a resolution must be passed by the City Council. The established constraints remain binding until City Council takes action to amend the applicable resolution. The City has a committed amount in the General Fund for emergencies and economic stability, which may only be accessed by majority vote of the City Council. The amount is calculated as thirty (30) percent of the General Fund’s annual operating budget, excluding one-time activity. The City also reports a committed amount for equipment replacement that is calculated as five (5) percent of the General Fund’s annual operating budget, excluding one-time activity.

Assigned Fund Balance –Represents that portion of fund balance that includes amounts that are constrained by the City’s intended use of the resources but are neither restricted nor committed. Such intent needs to be established at the highest level of decision making, or by an official designated for that purpose. The City Council has the authority to assign amounts to be used for specific purposes.

Unassigned Fund Balance – Represents that portion of fund balance that includes amounts that are not contained in any of the other fund balance categories. The General Fund is the only governmental fund that may report a positive amount as unassigned fund balance. For all other governmental funds, only negative balances may be reported as unassigned fund balance.

When an expenditure is incurred for purposes for which both restricted and unrestricted funds are available, it is the City’s policy to apply the restricted funds first. The City also considers committed funds to be spent first, assigned funds to be spent second and unassigned funds to be spent last when an expenditure is incurred for purposes for which committed, assigned and unassigned fund balance is available.

Long-term obligations
In the government-wide financial statements, long-term debt and other long-term obligations are reported as liabilities in the governmental activities. Bond premiums and discounts, are deferred and amortized over the life of the bonds using the straight line method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are expensed in the year of issuance.

In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as expenditures. 45 Page 95 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued D. Assets, liabilities and net position or equity, Continued Deferred Outflows/Inflows of Resources
In addition to assets, the statement of net position (balance sheet) will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of 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.

In addition to liabilities, the statement of net position (balance sheet) will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred 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 of resources (revenue) until that time.

E. New Pronouncements
In 2022, the City adopted new accounting standards to conform to the following Governmental Accounting Standards Board Statements:

GASB Statement No. 87, Leases – The objective of this statement is to recognize in the financial statements 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. The requirements of this statement did not have an impact on the City’s net position for the year ended June 30, 2022.

GASB Statement No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period – The objective this statement is to (1) to enhance the relevance and comparability of information about capital assets and the cost of borrowing for a reporting period and (2) to simplify accounting for interest cost incurred before the end of a construction period. This statement establishes accounting requirements for interest costs incurred before the end of a construction period. This Statement requires that interest cost incurred before the end of a construction period be recognized as 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. There was no impact on net position as a result of implementation of this statement.

GASB Statement No. 92, Omnibus – The objectives of this statement are to enhance comparability in accounting and financial reporting and to improve the consistency of authoritative literature by addressing practice issues that have been identified during implementation and application of certain GASB Statements. This Statement addresses a variety of topics and includes specific provisions about leases, intra-entity transfers between primary government and pension or OPEB plans, other pension plan reporting, fiduciary activities relating to postemployment benefit arrangements, asset retirement obligations, reporting for public entity risk pools, fair value measurement, and derivative instruments.

The requirements of this statement did not have an impact on the City’s net position for the year ended June 30, 2022.
46 Page 96 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

2. CASH AND INVESTMENTS
Cash and investments as of June 30, 2022, are classified in the accompanying financial statements as follows.

A. Deposits
The carrying amount of the City’s cash deposit was $547,978 at June 30, 2022. Bank balances before reconciling items were $1,400,971 the total amount of which was insured and/or collateralized with securities held by the pledging financial institutions in the City’s name as discussed below.

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

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

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

Primary Government
Governmental Fiduciary
Activities Funds Total
Deposits and investments $ 26,133,590 $ 3,871,689 $ 30,005,279 Cash and investments held
with fiscal agent - 2,280,202 2,280,202
Total cash and investments $ 26,133,590 $ 6,151,891 $ 32,285,481 Cash on hand $ 400
Deposits with financial institution 547,978
Total cash on hand and deposits 548,378
Local Agency Investment funds 29,456,901
Total investments 29,456,901
Total City Treasury 30,005,279
Cash and investments with fiscal agent 2,280,202
Total cash and investments $ 32,285,481
47 Page 97 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

2. CASH AND INVESTMENTS, Continued
B. Investments
Authorized investments
Under provisions of the City’s investment policy, and in accordance with Section 53601 of the California Government Code, the City may invest in the following types of investments:
 Securities of the U.S. Government, or its agencies,
 Certificates of deposit (or time deposits) placed with commercial banks and/or savings and loan companies,
 State of California – Local Agency Investment Fund (LAIF)  Checking accounts or passbook savings account demand deposits, and money market mutual funds.

The City’s investment policy is to apply the prudent-person rule: Investments are made as a prudent person would be expected to act, with discretion and intelligence, to seek reasonable income, preserve capital, and in general, avoid speculative investments. The table below identifies the investment types that are authorized for investments held by the City. The Table also identifies certain provisions of these investments that address interest risk and concentration of credit risk.

Authorization investment type
Maximum
maturity
Maximum
Percentage
allowed
Maximum
investment
in one issuer
U.S. Treasur Obligations 5 years None None
Local Agency Investment Fund (LAIF) 5 years None $75 million* Certificates of Deposit 2 years 15% None
FNMA (Fannie Mae) 5 years 75% None
GNMA (Ginnie Mae) 5 years 20% None
FHLMC (Freddie Mac) 5 years 75% None
Federal Home Loan Bank (FHLB) 5 years 75% None
Federal Farm Credit Bank (FFCB) 5 years 75% None
Federal Agricultural Mortagage
Corporation (FAMC of Farmer Mac) 5 years 75% None
Tennessee Valley Authority 5 years 75% None
Money Market Mutual Funds 5 years 5% None
*$75 million limit is maximum deposit limit set by LAIF. 48 Page 98 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

2. CASH AND INVESTMENTS, Continued
B. Investments, Continued
Investments authorized by debt agreements
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 bond trustee.

The Table also identifies certain provisions of these debt agreements that address interest risk and concentration of credit risk.

Interest rate risk
The City’s investment policy mitigates interest rate risk by:
(1) Structuring the City’s portfolio so that securities mature to meet the City’s cash requirements for ongoing operations, thereby avoiding the need to sell securities on the open market prior to their maturation to meet those specific needs;
(2) Investing primarily in short-term securities; and
(3) Occasionally restructuring the portfolio to minimize the loss of market value and/or to maximize cash flows.

Authorization investment type
Maximum
maturity
Maximum
percentage
allowed
Maximum
investment in
one issuer
U.S. Treasury Obligations None None None
U.S. Agency Securities None None None
Banker's Acceptances None None None
Commercial Paper None None None
Money Market Mutual Funds None None None
Repurchase/Investment Agreement 180 days None None
Investment Contracts None None None
Local Agency Investment Fund (LAIF) None None *$75 million FHA Obligations Guaranteed by U.S. Government None None None Federal Funds None None None
Negotiable Certificate of Deposit None None None
Time Deposits None None None
FDIC Insured Deposits None None None
Debt Obligations None None None
$75 million limit is maximum deposit limit set by LAIF.

Investment type Totals
Remaining
maturity
12 month or less
Local Agency Investment Fund (LAIF) $29,456,901 $ 29,456,901 Total Investments $ 29,456,901 $ 29,456,901
49 Page 99 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

2. CASH AND INVESTMENTS, Continued
B. Investments, Continued
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 possession of an outside party. The City’s investment policy limits its exposure to custodial credit risk.

Credit risk/pooled cash
The City currently follows GASB No. 40 which established the way the city discloses credit, custodial, interest rate and foreign currency risks. Currently, custodial and interest rate risk are minimal. The City does not own any foreign currency. The City’s most significant investment, LAIF, does not have a rating provided by a nationally recognized statistical rating agency.

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. The City currently invests excess monies in the LAIF and checking and savings accounts at local banks. Currently the City mitigates credit risk by:
(1) Limiting investments to the safest types of securities; (2) Pre-qualifying with an established financial institution with which it will do business; and (3) Diversifying the investment portfolio so that a failure of any one issuer or backer will not place an undue financial burden on the City.

Concentration of credit risk
The investment policy of the City contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code. The City’s most significant investment, LAIF, does not have a rating provided by a nationally recognized statistical rating agency.

Investment type Amount
Minimum
legal rating Not Rated
Local Agency Investment Fund (LAIF) $ 29,456,901 N/A $ 29,456,901 Total Investments $ 29,456,901 $ 29,456,901
Rating
50 Page 100 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

2. CASH AND INVESTMENTS, Continued
B. Investments, Continued
Investment in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California.

The balance is available for withdrawal on demand. The City’s investment with LAIF at June 30, 2022 includes a portion of the pool funds invested in Structured Notes and Asset-Backed Securities. These investments include the following:

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 have embedded forwards or options.

Asset-Backed Securities, the bulk of which are mortgage-backed securities, entitle their purchasers to receive a share of the cash flows from a pool of assets such as principal and interest repayments from a pool of mortgages (such as collateralized mortgage obligations) or credit card receivables.

As of June 30, 2022, the City had $29,456,901 invested in LAIF, which had invested 1.88% of the pool investment funds in Structured Notes and Asset-Backed Securities as compared to 2.31% in the previous year. The remaining 98.12% of the pool investment funds were invested in United States Treasury Bills and Notes (68.02%), Federal Agency Discount Notes (12.82%), Certificates of Deposit (5.67%), Long Term Commercial Paper (4.17%), Federal Agency Debentures (3.99%), and other allowable investments (3.45%).

The LAIF fair value factor of 0.987125414 was used to calculate the fair value of the investments in LAIF, resulting in in the following investment income in all funds:

3. INTERFUND TRANSACTIONS
A. Interfund Transfers
The composition of interfund transfers for the fiscal year ended June 30, 2022 were as follows:

The transfers which occurred were: Combined $91,849 from General Fund to Non-Major Governmental Funds to fund Lighting/Landscape District activities and for capital projects.

Interest income $ 106,261
Unrealized gain/(loss) in changes in fair value of investments (384,192) Total investment income (loss) $ (277,931)
Non Major
Governmental Funds Total
Major Fund:

General Fund $ 91,849 $ 91,849
Total $ 91,849 $ 91,849
Transfers Out
Transfers In
51 Page 101 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

3. INTERFUND TRANSACTIONS, Continued
B. Due to/from Other Funds
The General Fund reported due from Non Major Governmental Funds of $158,758 that represents short term borrowings to be repaid upon receipt of future revenues.

4. CAPITAL ASSETS
A summary of changes in capital assets at June 30, 2022 is as follows:

Depreciation expense was charged to functions/programs of the City as follows:

Beginning
balance Additions Deletions
Ending
Balance
Governmental activities
Capital assets not being depreciated:

Land $ 1,918,401 $ - $ - $ 1,918,401
Construction in progress 5,251,343 2,638,342 220,779 7,668,906 Total capital assets not being depreciated 7,169,744 2,638,342 220,779 9,587,307 Capital assets being depreciated:

Building and improvements 4,258,214 220,779 - 4,478,993 Machinery and equipment 1,350,459 155,762 153,350 1,352,871 Road network 13,717,079 - - 13,717,079
Total capital assets being depreciated 19,325,752 376,541 153,350 19,548,943 Less accumulated depreciation for:

Buildings and improvements (1,264,054) (122,275) - (1,386,329) Machinery and equipment (731,198) (119,525) (153,350) (697,373) Road network (4,232,524) (478,707) - (4,711,231)
Total accumulated depreciation (6,227,776) (720,507) (153,350) (6,794,933) Total capital assets, being depreciated, net 13,097,976 (343,966) 306,700 12,754,010 Governmental activities capital assets, net $ 20,267,720 $ 2,294,376 $ 527,479 $ 22,341,317 General government $ 12,485
Public safety 103,509
Public works 503,286
Community services and development 22,978
Parks and recreation 78,249
Total depreciation expense - governmental activities $ 720,507 52 Page 102 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

5. LONG-TERM LIABILITIES
The following is a summary of the changes in the long-term liabilities for the fiscal year ended June 30, 2022:

Compensated absences
For the governmental funds, accumulated vacation, and compensatory time payable at June 30, 2022, was $310,178. These amounts are payable from futures resources and therefore have been recorded as long-term liabilities. These liabilities are generally liquidated by the General Fund.

Finance Purchase Agreement – Fire Truck
On October 16, 2017, the City entered into a finance purchase agreement with the Municipal Finance Corporation to finance the acquisition of a fire engine. The balance will be paid off in 10 annual installment payments and is not considered a lease in accordance with GASB Statement No. 87. Future debt service requirements as of June 30, 2022, were as follows:

Due in
Beginning Ending Due within more than
Description Balance Additions Deletions Balance one year one year Compensated Absences 268,800$ 117,768$ $ 76,390 310,178$ 55,190$ 254,988$ Finance Purchase Agreement 301,601 - 39,123 262,478 40,375 222,103 Total Long-Term Liabilities 570,401$ 117,768$ $ 115,513 572,656$ 95,565$ 477,091$ Fiscal Year
Ending June 30 Principal Interest Total
2023 $ 40,375 $ 8,399 $ 48,774
2024 41,667 7,107 48,774
2025 43,001 5,773 48,774
2026 44,376 4,398 48,774
2027 45,797 2,977 48,774
2028 47,262 1,512 48,774
Total $ 262,478 $ 30,166 $ 292,644
53 Page 103 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

6. EMPLOYEE RETIREMENT PLANS
Defined Benefit Plan:

A. Plan Description
All qualified permanent and probationary employees are eligible to participate in the Public Agency Cost-Sharing Multiple-Employer Defined Benefit Pension Plan (Plan) administered by the California Public Employees’ Retirement System (CalPERS). The Plan consists of individual rate plans (benefit tiers) within a safety risk pool (police and fire) and a miscellaneous risk pool (all other). Plan assets may be used to pay benefits for any employer rate plan of the safety and miscellaneous risk pools. Accordingly, rate plans within the safety or miscellaneous pools are not separate plans under GASB Statement No. 68.

Individual employers may sponsor more than one rate plan in the miscellaneous or safety risk pools. The City sponsors one rate plan (miscellaneous). Benefit provisions under the Plan are established by State statute and City resolution. CalPERS issues publicly available reports that include a full description of the pension plan regarding benefit provisions, assumptions, and membership information that can be found on the CalPERS website (www.calpers.ca.gov).

B. Benefits Provided
CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following:
the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied as specified by the Public Employee’s Retirement Law.

The Plan’s provisions and benefits in effect at June 30, 2022 are summarized as follows:

Contributions – Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers are to be determined on an annual basis by the actuary and are effective on the July 1 following notice of a change in the rate. Funding contributions for the Plan is determined annually on an actuarial basis as of June 30 by CalPERS. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees.

Prior to On or after
Hire date January 1, 2013 January 1, 2013
Benefit formula 2% @ 60 2% @ 62
Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50 - 55 52-62
Monthly benefits, as a % of eligible compensation 2.0% to 2.7% 1.0% to 2.5% Required employee contribution rates 7.000% 6.750%
Required employer contribution rates 9.130% 7.590%
Required employer dollar UAL payment (annual) $72,863 $1,770 Miscellaneous
54 Page 104 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

6. EMPLOYEE RETIREMENT PLANS, Continued
Defined Benefit Plan, Continued:

B. Benefits Provided, Continued
For the measurement period ended June 30, 2021, the employer contributions recognized against net pension liability for the Plan were $131,048. For the fiscal year ended June 30, 2022, the employer contributions reported as deferred outflows of resources were $156,867.

C. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions As of June 30, 2022, the City reported net pension liabilities for its proportionate shares of the net pension liability of the Plan of $445,340.

The City’s net pension liability for the Plan is measured as the proportionate share of the total net pension liability of the Plan. The net pension liability of the Plan is measured as of June 30, 2021, and the total pension liability for the Plan used to calculate the net pension liability was determined by actuarial valuations as of June 30, 2020 rolled forward to June 30, 2021 using standard update procedures. The City’s proportionate of the net pension liability was based on the City’s plan liability and asset-related information where available, and proportional allocations of individual plan amounts as of the valuation date where not available.

The City’s proportionate share of the net pension liability for the Plan as of the measurement dates June 30, 2020 and 2021 were as follows:

For the year ended June 30, 2022, the City recognized pension expense of $20,026. The lower pension expense recognized during the year was attributable to a $3.3 billion investment return on the miscellaneous risk pool during the measurement period that will be reflected as reduction to pension expense over a period of 5 years.

Miscellaneous
Proportion - June 30, 2020 0.008860%
Proportion - June 30, 2021 0.008230%
Change - Increase (Decrease) -0.000630%
55 Page 105 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

6. EMPLOYEE RETIREMENT PLANS, Continued
Defined Benefit Plan, Continued:

C. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions, Continued
At June 30, 2022, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
$156,867 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ending June 30, 2023. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:

Deferred Outflows
of Resources
Deferred Inflows of
Resources
Pension contributions subsequent to measurement date $ 156,867 $ - Changes of assumptions - -
Differences between expected and actual experience 49,941 - Changes in employer's proportion 67,152 -
Differences between the employer's contribution and the employer's proportionate share of contributions - 60,146 Net differences between projected and actual earnings on plan investments - 388,758
Total $ 273,960 $ 448,904
Fiscal Year
Ending June 30:
2023 $ (67,062)
2024 (72,328)
2025 (84,989)
2026 (107,432)
56 Page 106 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

6. EMPLOYEE RETIREMENT PLANS, Continued
Defined Benefit Plan, Continued:

C. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions, Continued
Actuarial Assumptions – The total pension liabilities in the June 30, 2020 actuarial valuations were determined using the following actuarial assumptions:

The mortality table used was developed based on CalPERS-specific data. The table includes 15 years of mortality improvements using Society of Actuaries Scale 90% of scale MP 2016. For more details on this table, please refer to the December 2017 experience study report (based on CalPERS demographic data from 1997 to 2015) that can be found on the CalPERS website.

Discount Rate – 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 the 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 percent 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 percent will be applied to all plans in the Public Employees Retirement Fund (PERF). The stress test results are presented in a detailed report that can be obtained from the CalPERS website.

The long-term expected rate of return on pension plan investments was determined using a buildingblock method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.

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. Using historical returns of all the funds’ asset classes, expected compound 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.

Valuation Date June 30, 2020
Measurement Date June 30, 2021
Actuarial Cost Method Entry-Age Normal Cost Method
Actuarial Assumptions:

Discount Rate 7.15%
Inflation 2.50%
Projected Salary Increase Varies by entry age and service Investment Rate of Return 7.15%
Mortality Derived by CalPERS membership data for all funds Post Retirement Benefit
Increase
Contract COLA up to 2.50% until Purchasing Power
Protection Allowance Floor on Purchasing Power applies
(1) Net of pension plan investment and administrative expenses, including inflation 57 Page 107 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

6. EMPLOYEE RETIREMENT PLANS, Continued
Defined Benefit Plan, Continued:

C. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions, Continued
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 short-term and longterm returns. The expected rate of return was then set equivalent to the single equivalent rate calculated above and rounded down to the nearest one quarter of one percent.

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

Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate – The following presents the City’s proportionate share of the net pension liability for the Plan, calculated using the discount rate for the 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 1-percentage point lower or 1- percentage point higher than the current rate:

D. Payable to the Pension Plan
At June 30, 2022, the City did not report any outstanding amount of contributions to the pension plan required for the year ended June 30, 2022.

New
Strategic Real Return Real Return
Asset Class Allocation Years 1 - 10
(a)
Years 11+ (b)
Global Equity 50.00% 4.80% 5.98%
Global Fixed Income 28.00% 1.00% 2.62%
Inflation Sensitive 0.00% 0.77% 1.81%
Private Equity 8.00% 6.30% 7.23%
Real Estate 13.00% 3.75% 4.93%
Liquidity 1.00% 0.00% -0.92%
Total 100%
(a) An expected inflation of 2.00% used for this period. (b) An expected inflation of 2.92% used for this period. 1% Decrease 6.15%
Net Pension Liability (Asset) $ 1,086,138
Current Discount Rate 7.15%
Net Pension Liability (Asset) $ 445,340
1% Increase 8.15%
Net Pension Liability (Asset) $ (84,399)
58 Page 108 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

6. EMPLOYEE RETIREMENT PLANS, Continued
Defined Contribution Plan:

The City sponsors the City of Calimesa Public Agency Retirement System (PARS) Defined Contribution Plan for its fire employees. An Eligible Employee shall participate in this Plan if he or she is a full-time Fire Safety Employee of the City on or after September 1, 2017. The City contributes 7.5% of employee compensation annually into the Plan. Employees’ contributions are optional. Each Participant shall be one hundred percent (100%) vested in his or her Employer Contribution Account at all times. During the fiscal year ended June 30, 2022, the City contributed $59,010 to the Plan.

7. RISK MANAGEMENT
In July 1996, the City became a member of the Public Agency Risk Sharing Authority of California (PARSAC), a consortium of California cities, established in May 1986 to pool resources, share risks, purchase excess insurance and to share costs for professional risk management and claims administration. During fiscal year ended June 30, 2022, PARSAC merged with California Intergovernmental Risk Authority (CIRA). The Authority’s governing board consists of one appointed official and an alternate from each participating city.

General and auto liability, public officials’ errors and omission – The City maintains a self-insurance program for its general and auto liability, and public officials’ errors and omission. For liability claims, the City is at risk for up to $10,000 per occurrence; amounts in excess of $10,000 up to $1,000,000 are covered through the California Intergovernmental Risk Authority (CIRA). Amounts in excess of $1,000,000 up to $35,000,000 are covered through additional insurance purchased from third parties by CIRA.

Employment practices liability – The City maintains a self-insurance program for its employment practices liability. For liability claims, the City is at risk for up to $10,000 per occurrence; amounts in excess of $10,000 up to $1,000,000 are covered through the Employment Risk Management Authority (ERMA).

Workers’ compensation – The City maintains workers’ compensation insurance through CIRA. The City is at risk up to $25,000 per occurrence. Coverage through CIRA is up to $500,000 per claim. Claims in excess of $500,000, up to $5,000,000 are covered by policies purchased by CIRA through third parties.

Property insurance – The City maintains a self-insurance program for its property up to $5,000. Amounts in excess of $5,000 up to $1,000,000 are covered through additional insurance purchased from third parties by CIRA.

Employee dishonesty, theft, fraud – The City maintains employee dishonesty, theft, and fraud insurance through CIRA up to $2,500. Amounts in excess of $2,500 up to $1,000,000 are covered by policies purchased from third parties by CIRA.

8. CONTINGENCIES
The City participates in certain federal and state assisted grant programs. These programs are subject to program compliance audits by the grantors or their representatives. Any liability for reimbursement which may arise as the result of these audits is not believed to be material.

The City is not involved in any pending lawsuits that may have a material adverse effect on the financial statements of the City.
59 Page 109 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

9. DISSOLUTION OF REDEVELOPMENT AGENCIES IN CALIFORNIA AND RESULTANT

SUCCESSOR AGENCY TO THE FORMER REDEVELOPMENT AGENCY
On December 29, 2011 the California Supreme Court upheld Assembly Bill 1X 26 (AB 1X 26) that provides for the dissolution of all redevelopment agencies in the State of California. Likewise, this action affected the reporting entity of the City of Calimesa in that the former Redevelopment Agency’s financial activities and related disclosures were reported within the City’s government-wide financial statements (blended component unit) as capital project and debt service funds. Timelines established within AB 1X 26 included the dissolution and cessation of redevelopment agencies as of February 1, 2012.

AB 1X 26 prescribes that either the city or another local government entity must serve as the successor agency to the former redevelopment agency. The role of the successor agency is to hold net assets of the former redevelopment agency until they can be transferred to the state or respective county. On February 6, 2012 the City Council adopted Resolution No. 2012-01 which provided for the low-to-moderate income housing functions (LMI) and related net assets of the former Redevelopment Agency to be assumed by the City Council.

Resolution No. 2012-01 of the Calimesa Successor Agency (CSA) was approved which provided for the City to act as the successor agency to the former Redevelopment Agency. For clarity and ease of financial statement presentation purposes, both the LMI and non-housing financial activities and net position subsequent to January 31, 2012 are reported as fiduciary funds in these basic financial statements.

In future fiscal years, successor agencies will only be allocated revenue by the State and respective county in amounts necessary to pay installment and/or bonded indebtedness annual payments required by listed enforceable obligations of the former redevelopment agencies which are supported by legally enforceable documents, such as bond indentures and related covenants. These payments will occur until such time that the obligations are paid in full.

The following is a summary of the changes in bonds payable in the Successor Agency Trust Fund for the fiscal year ended June 30, 2022:
2014 Tax Allocation Refunding Revenue Bonds
In May 2014, the Calimesa Successor Agency (City) issued Calimesa Redevelopment Project No. 1 and Project No. 5 Tax Allocation Refunding Revenue Bonds, Series 2014, in the aggregate principal of $2,925,000.

The bonds are dated May 2014 and are in denominations of $5,000 and bear interest at rates ranging from

2.00% to 4.00%. Principal is payable annually on December 1 beginning on December 2014.

Description
Beginning
balance Additions Deletions
Ending
balance
Due within
one year
Bonds
2014 Series bonds, Refunding $ 2,255,000 $ - $ (110,000) $ 2,145,000 $ 115,000 Deferred amounts
For issuance premium,
relating to 2014 bonds 12,247 - (5,926) 6,321 -
Total Bonds $ 2,267,247 $ - $ (115,926) $ 2,151,321 $ 115,000 60 Page 110 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

9. DISSOLUTION OF REDEVELOPMENT AGENCIES IN CALIFORNIA AND RESULTANT SUCCESSOR AGENCY TO THE FORMER REDEVELOPMENT AGENCY, Continued Interest is payable semi-annually on June 1 and December 1 commencing on December 1, 2014. The bonds mature between the time frames of December 1, 2014 and December, 2038 in amounts ranging from $60,000 to $920,000.

The annual debt service requirements on the 2014 Bonds are as follows:
2014 Tax Allocation Refunding Revenue Bonds, Continued
The bonds were issued to assist the Agency in the financing of redevelopment activities, to fund the Reserve Subaccounts and to pay certain costs relating to the issuance of the bonds. Per the bond indenture, a reserve is required to be maintained and at June 30, 2022, the amount held in the reserve account was $211,492 which was fully funded. The bonds are payable from and equally and ratably secured by a first pledge of Revenues consisting primarily of certain property tax revenues to be derived from the Project Areas.

Pledged revenues
The Successor Agency pledged 100% of future tax increment revenue (less amounts payable by or required to be set –aside by the Agency under any pass-through agreements and by the amount required to be setaside for low and moderate housing as required by the California Health and Safety Code) as security for the bonds. While the pledge was originally considered outstanding for the duration of the debt service requirements, the dissolution of redevelopment agencies pursuant to AB 1X26 has led to the practice of the State of California granting annual payments to successor agencies to make the required bond debt services requirements as well as payments for other obligations listed on each agency’s schedule of enforceable obligations.

10. CONDUIT DEBT
The City has previously issued bonds for various Community Facilities Districts under the public improvement act (Mello-Roos Community Facilities Act of 1982) of the State of California to finance the acquisition and construction of certain public facilities servicing property within the respective district boundaries. The bonds are secured by annual special tax levies or liens placed on the property within the district.

Fiscal Year Ending
June 30 Principal Interest
2023 $ 115,000 $ 78,638
2024 120,000 74,038
2025 125,000 68,038
2026 130,000 64,288
2027 135,000 60,388
2028-2032 725,000 232,793
2033-2037 720,000 89,926
2038-2039 75,000 4,600
Total $ 2,145,000 $ 672,709
61 Page 111 of 251
City of Calimesa
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2022

10. CONDUIT DEBT, Continued
The City is not liable for repayment and acts only as an agent for the property owners in collecting the special taxes or assessments, forwarding the collections to bondholders, and initiating foreclosure proceedings when necessary. These bonds are payable solely from special taxes or assessments, specific reserves, and the proceeds from property foreclosures to be levied by the district. The outstanding balance of all conduit debt of the City as of June 30, 2022 was $27,038,476.

11. AMERICA RESCUE PLAN ACT (ARPA)
The America Rescue Plan Act of 2021 (ARPA) is a $1.9 trillion economic stimulus bill passed to expedite the recovery from the economic and health effects of the COVID-19 pandemic. As part of ARPA, the City was allocated $2,191,267 in Coronavirus State and Local Fiscal Recovery Funds. The City has received $1,095,633 of the allocation (first tranche) as of June 30, 2022, currently reflected as unearned revenues and the remaining amount was received subsequent to the end of the fiscal year. The first tranche is expected to be spent on the citywide pavement management program.
62 Page 112 of 251

REQUIRED

SUPPLEMENTARY INFORMATION
63 Page 113 of 251
City of Calimesa
Required Supplementary Information
For the year ended June 30, 2022

1. DEFINED BENEFIT PENSION PLAN
Schedule of the City's Proportionate Share of the Net Pension Liability - Last Ten Fiscal Years Fiscal Year: 2022 2021 2020 2019
Measurement Date 6/30/2021 6/30/2020 6/30/2019 6/30/2018 City's proportion of the net pension
liability 0.00823% 0.00886% 0.00839% 0.00789%
City's proportionate share of the net
pension liability $ 445,340 $ 963,472 $ 860,069 $ 760,407 City's covered payroll (plan year) $ 850,713 $ 929,097 $ 802,415 $ 821,901 City's proportionate share of the net
pension liability as a percentage
of its covered payroll 52.35% 103.70% 107.19% 92.52%
City's fiduciary net position as a
percentage of the total pension
liability 88.29% 75.10% 75.26% 75.26%
Notes to the schedule:
*Fiscal year 2015 was the 1st year of implementation, therefore there are fewer than 10 years shown.

Benefit changes: In fiscal year 2021-2022 there were no benefit changes.

Changes in assumptions: In fiscal year 2018-2019, the plan's discount rate was unchanged from 7.15%.

In fiscal year 2019-2020, the discount rate was changed to 7.25%. In fiscal year 2020-2021, the discount rate changed to 7.15% 64 Page 114 of 251
2018 2017 2016 2015
6/30/2017 6/30/2016 6/30/2015 6/30/2014

0.00808% 0.79000% 0.00710% 0.00783%
$ 801,322 $ 683,932 $ 487,286 $ 487,296
$ 699,490 $ 697,838 $ 835,197 $ 610,159
114.56% 98.01% 58.34% 79.86%

73.31% 74.06% 78.40% 79.82%
65 Page 115 of 251
City of Calimesa
Required Supplementary Information
For the year ended June 30, 2022

1. DEFINED BENEFIT PENSION PLAN
Schedule of Pension Contributions - Last Ten Fiscal Years Fiscal Year 2022 2021 2020 2019
Contractually required contribution $ 156,867 $ 131,048 $ 122,260 $ 99,636 Contributions in relation to the
contractually required contribution (156,867) (131,048) (122,260) (99,636) Contribution deficiency (excess) $ - $ - $ - $ -
City's covered payroll
(City's fiscal year) $ 850,713 1,024,657 $ 929,097 $ 802,415 $ Contributions as a percentage of
covered payroll 15.31% 15.40% 13.16% 12.42%
Notes to the schedule:

Valuation date : 6/30/2019 6/30/2018 6/30/2017 6/30/2016 Actuarial cost method: Entry Age Entry Age Entry Age Entry Age Amortization method: (1)(1) (1)(1)
Assets valuation method: Market Value Market Value Market Value Market Value Inflation: 2.50% 2.50% 2.63% 2.75%
Salary increases: (2)(2) (2)(2)
Investment rate of return: 7.00% 7.00% 7.25% 7.375%
Retirement age: (3)(3) (3)(3)
Mortality: (4)(4) (4)(4)
(1)
(2)
(3)
(4)
Level percentage of payroll, closed
Depending on age, service, and type of employment
50 for all plans, with the exception of 52 for Miscellaneous PEPRA 2%@62 Mortality assumptions are based on mortality rates resulting from the most recent CalPERS Experience Study adopted by the CalPERS Board. *Fiscal year 2015 was the 1st year of implementation, therefore there are fewer than 10 years shown.

The actuarial methods and assumptions used to set the actuarially determined contributions were as follows:
66 Page 116 of 251
2018 2017 2016 2015
$ 81,270 $ 90,337 $ 82,408 $ 93,041
(81,270) (90,337) (82,408) (93,041)
$ - $ - $ - $ -
$ 821,901 $ 699,490 $ 697,838 $ 835,197

9.89% 12.91% 11.81% 11.14%
6/30/2015 6/30/2014 6/30/2013
Entry Age Entry Age Entry Age
(1) (1) (1)
Market Value Market Value Market Value

2.75% 2.75% 2.75%
(2) (2) (2)

7.50% 7.50% 7.50%
(3) (3) (3)
(4) (4) (4)
6/30/2012
Entry Age
(1)
15 Year Smoothed
Market Method

2.75%
(2)

7.50%
(3)
(4)
67 Page 117 of 251
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68 Page 118 of 251
City of Calimesa
Notes to the Required Supplementary Information, Continued For the year ended June 30, 2022

2. BUDGETARY INFORMATION
The City Council has the responsibility for adoption of the City’s budgets. Budgets are adopted for governmental funds. From the effective date of the budget, the amounts stated as proposed expenditures become appropriations to the various City departments. The City Council may amend the budget by resolution during each fiscal year. The City Manager is authorized to transfer funds from one major expenditure category to another within the same department and fund. Any revisions that alter the total expenditures of any fund must be approved by the City Council.

All appropriations lapse at the end of the fiscal year to the extent that they have not been expended.

Budgetary comparisons are provided in the accompanying financial statements for all funds with legally adopted budgets. Budget amounts are adopted on a basis consistent with accounting principles accepted in the United States of America.
69 Page 119 of 251
City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual General Fund
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Taxes $ 6,280,911 $ 7,028,833 $ 7,333,567 $ 304,734
Licenses & permits 529,901 483,807 544,310 60,503
Fines & forfeitures 31,000 34,000 42,675 8,675
Intergovernmental 2,200 161,137 161,525 388
Charges for services 695,454 699,320 700,370 1,050
Development fees 411,890 426,958 453,228 26,270
Interest income 50,710 21,800 37,593 15,793
Unrealized loss on investments - - (384,192) (384,192)
Other 30,000 58,000 15,908 (42,092)
Total revenues 8,032,066 8,913,855 8,904,984 (8,871)
EXPENDITURES:

Current:

General government 1,544,575 1,800,659 1,604,307 196,352 Public safety 5,005,283 5,065,811 4,624,998 440,813
Public works 548,477 596,390 437,128 159,262
Community development 788,711 823,711 705,994 117,717
Parks and recreation 152,376 159,076 112,482 46,594
Total expenditures 8,039,422 8,445,647 7,484,909 960,738 REVENUES OVER EXPENDITURES (7,356) 468,208 1,420,075 $ 951,867 OTHER FINANCING SOURCES (USES):

Transfers out (90,000) (91,849) (91,849) -
Total other financing sources (uses) (90,000) (91,849) (91,849) - Net change in fund balance $ (97,356) $ 376,359 1,328,226 $ 951,867 FUND BALANCE:

Beginning of year 7,414,975
End of year $ 8,743,201
Budgeted Amounts
70 Page 120 of 251
City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Measure A Special Revenue Fund
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Intergovernmental $ 192,000 $ 246,000 $ 300,718 $ 54,718 Investment earnings 5,000 1,000 1,991 991
Total revenues 197,000 247,000 302,709 55,709
EXPENDITURES:

Current:

Public works 209,760 534,760 17,088 517,672
Total expenditures 209,760 534,760 17,088 517,672

REVENUES OVER (UNDER)
EXPENDITURES (12,760) (287,760) 285,621 573,381
OTHER FINANCING SOURCES (USES):

Transfers in - - - -
Total other financing sources (uses) - - - -
Net change in fund balance $ (12,760) $ (287,760) 285,621 $ 573,381 FUND BALANCE:

Beginning of year 429,417
End of year $ 715,038
Budgeted Amounts
71 Page 121 of 251
City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Mitigation Fees Special Revenue Fund
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Intergovernmental $ 2,000,000 $ 19,775,973 $ 2,030,017 $ (17,745,956) Development fees 221,620 2,583,454 726,670 (1,856,784)
Investment earnings 63,500 28,500 45,013 16,513
Total revenues 2,285,120 22,387,927 2,801,700 (19,586,227) EXPENDITURES:

Current:

General government 354,280 548,089 138,826 409,263
Public safety 9,766 9,766 9,766 -
Public works 2,234,392 25,061,804 2,553,838 22,507,966
Parks and recreation 6,135 10,135 9,796 339
Library 54,280 9,280 4,453 4,827
Debt service:

Principal 39,123 39,123 39,123 -
Interest and fiscal charges 10,851 10,251 11,226 (975)
Total expenditures 2,708,827 25,688,448 2,767,028 22,921,420

REVENUES OVER (UNDER)
EXPENDITURES (423,707) (3,300,521) 34,672 3,335,193
OTHER FINANCING SOURCES (USES):

Transfers in 200,000 499,705 - (499,705)
Total other financing sources (uses) 200,000 499,705 - (499,705) Net change in fund balance $ (223,707) $ (2,800,816) 34,672 $ 2,835,488 FUND BALANCE:

Beginning of year 12,311,520
End of year $ 12,346,192
Budgeted Amounts
72 Page 122 of 251
City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual ARPA Special Revenue Fund
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Investment earnings $ - $ 2,500 $ 3,935 $ 1,435
Total revenues - 2,500 3,935 1,435
Net change in fund balance $ - $ 2,500 3,935 $ 1,435
FUND BALANCE:

Beginning of year -
End of year $ 3,935
Budgeted Amounts
73 Page 123 of 251
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74 Page 124 of 251

SUPPLEMENTARY INFORMATION
75 Page 125 of 251
Nonmajor Governmental Funds
Supplemental
Law
Enforcement
Grant
Housing
Rehab-State Library
Transportation
Air Quality
Improvements Gas Tax
Assets
Cash and investments $ 88,332 $ 192,259 $ 386,409 $ 40,197 $ - Receivables:

Accounts - - - - -
Intergovernmental - - - 3,367 47,367
Loans - 774,357 - - -
Total assets $ 88,332 $ 966,616 $ 386,409 $ 43,564 $ 47,367 Liabilities, Deferred Inflows of
Resources and Fund Balance
Liabilities:

Accounts payable and accrued liabilities $ 11,322 $ 925 $ 1,942 $ - $ 7,428 Unearned revenues - - 40,045 - -
Due to other funds - - - - 7,326
Deposits - - 38,963 - -
Total liabilities 11,322 925 80,950 - 14,754
Deferred Inflow of Resources:

Unavailable revenues - - - - -
Total deferred inflows of resources - - - - -
Fund Balance:

Restricted 77,010 965,691 305,459 43,564 32,613
Assigned - - - - -
Total fund balance 77,010 965,691 305,459 43,564 32,613 Total liabilities, deferred inflows of
resources, and fund balance $ 88,332 $ 966,616 $ 386,409 $ 43,564 $ 47,367 City of Calimesa
Combining Balance Sheets
June 30, 2022
Special Revenues Funds
76 Page 126 of 251
Lighting/
Landscape
District Recycling
Housing
Rehab -
Federal
Road
Maintenance
and Rehab
Planning
Grants
General
Capital
Projects Fund
Total
Nonmajor
Governmental
Funds
$ 50,311 $ 15,057 $ 61,971 $ 532,468 $ - $ 60,163 $ 1,427,167 1,073 - - 36,693 151,432 - 189,198
- - - - - - 50,734
- - 374,290 - - - 1,148,647
$ 51,384 $ 15,057 $ 436,261 $ 569,161 $ 151,432 $ 60,163 $ 2,815,746 $ 5,746 $ - $ 325 $ - $ - $ 618 $ 28,306
- - - - - - 40,045
- - - - 151,432 - 158,758
- - - - - - 38,963
5,746 - 325 - 151,432 618 266,072
- - - - - - -
- - - - - - -
45,638 15,057 435,936 569,161 - - 2,490,129
- - - - - 59,545 59,545
45,638 15,057 435,936 569,161 - 59,545 2,549,674
$ 51,384 $ 15,057 $ 436,261 $ 569,161 $ 151,432 $ 60,163 $ 2,815,746 Capital
Special Revenues Funds Projects
77 Page 127 of 251
Nonmajor Governmental Funds
Supplemental
Law
Enforcement
Grant
Housing
Rehab-State Library
Transportation
Air Quality
Improvements Gas Tax
Revenues
Taxes $ - $ - $ - $ - $ -
Intergovernmental 161,285 389 36,074 12,849 248,325
Investment earnings 312 692 1,377 133 33
Other - - - - -
Total Revenues 161,597 1,081 37,451 12,982 248,358
Expenditures
Current:

Public safety 144,867 - - - -
Public works - 3,900 - - 239,043
Community services and development - - - 2,458 -
Library - - 18,764 - -
Total Expenditures 144,867 3,900 18,764 2,458 239,043
Excess (Deficit) of Revenues Over
Expenditures 16,730 (2,819) 18,687 10,524 9,315
Other Financing Sources (Uses)
Transfers in (Note 4) - - - 1,849 -
Total Other Financing Sources (Uses) - - - 1,849 -
Net Change in Fund Balance 16,730 (2,819) 18,687 12,373 9,315 Fund Balance - Beginning of year 60,280 968,510 286,772 31,191 23,298 Fund Balance - End of year $ 77,010 $ 965,691 $ 305,459 $ 43,564 $ 32,613 City of Calimesa
For the Year Ended June 30, 2022
Special Revenues Funds
Combining Statements of Revenues, Expenditures, and Changes in Fund Balance 78 Page 128 of 251
Capital
Projects
Lighting/
Landscape
District Recycling
Housing
Rehab -
Federal
Road
Maintenance
and Rehab
Planning
Grants
General
Capital
Projects Fund
Total
Nonmajor
Governmental
Funds
$ 104,584 $ - $ - $ - $ - $ - $ 104,584
- 5,000 - 207,789 165,797 - 837,508
86 50 222 1,720 - 216 4,841
- - - - 16,900 - 16,900
104,670 5,050 222 209,509 182,697 216 963,833
- - - - - - 144,867
155,628 6,940 325 - - 5,998 411,834
- - - - 182,697 - 185,155
- - - - - - 18,764
155,628 6,940 325 - 182,697 5,998 760,620
(50,958) (1,890) (103) 209,509 - (5,782) 203,213
85,000 - - - - 5,000 91,849
85,000 - - - - 5,000 91,849
34,042 (1,890) (103) 209,509 - (782) 295,062
11,596 16,947 436,039 359,652 - 60,327 2,254,612
$ 45,638 $ 15,057 $ 435,936 $ 569,161 $ - $ 59,545 $ 2,549,674 Special Revenues Funds
79 Page 129 of 251
City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Special Law Enforcement Grant Special Revenue Fund
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Intergovernmental $ 148,500 $ 161,285 $ 161,285 $ -
Investment earnings 350 185 312 127
Total revenues 148,850 161,470 161,597 127
EXPENDITURES:

Current:

Public safety 167,295 161,295 144,867 16,428
Total expenditures 167,295 161,295 144,867 16,428
Net change in fund balance $ (18,445) $ 175 16,730 $ 16,555 FUND BALANCE:

Beginning of year 60,280
End of year $ 77,010
Budgeted Amounts
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City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Housing Rehab - State
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Intergovernmental $ 3,500 $ 3,500 $ 389 $ (3,111)
Investment earnings 500 500 692 192
Total revenues 4,000 4,000 1,081 (2,919)
EXPENDITURES:

Current:

Public works - 3,500 3,900 (400)
Total expenditures - 3,500 3,900 (400)
Net change in fund balance $ 4,000 $ 500 (2,819) $ (3,319) FUND BALANCE:

Beginning of year 968,510
End of year $ 965,691
Budgeted Amounts
81 Page 131 of 251
City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Library Special Revenue Fund
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Intergovernmental $ 36,820 $ 36,074 $ 36,074 $ -
Charges for services 1,000 1,000 - (1,000)
Investment earnings 2,600 860 1,377 517
Other 1,000 1,000 - (1,000)
Total revenues 41,420 38,934 37,451 (1,483)
EXPENDITURES:

Current:

Library 32,375 32,375 18,764 13,611
Total expenditures 32,375 32,375 18,764 13,611
Net change in fund balance $ 9,045 $ 6,559 18,687 $ 12,128 FUND BALANCE:

Beginning of year 286,772
End of year $ 305,459
Budgeted Amounts
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City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Transportation Air Quality Improvement Special Revenue Fund For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Intergovernmental $ 11,700 $ 12,100 $ 12,849 $ 749
Charges for services - - - -
Investment earnings 140 70 133 63
Total revenues 11,840 12,170 12,982 812
EXPENDITURES:

Current:

Community development 1,070 2,458 2,458 -
Total expenditures 1,070 2,458 2,458 -
REVENUES OVER (UNDER) EXPENDITURES 10,770 9,712 10,524 812 OTHER FINANCING SOURCES (USES):

Transfers in - 1,849 1,849 -
Total other financing sources (uses) - 1,849 1,849 -
Net change in fund balance $ 10,770 $ 11,561 12,373 $ 812 FUND BALANCE:

Beginning of year 31,191
End of year $ 43,564
Budgeted Amounts
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City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Gas Tax Special Revenue Fund
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Intergovernmental $ 237,396 $ 272,841 $ 248,325 $ (24,516) Investment earnings 200 65 33 (32)
Total revenues 237,596 272,906 248,358 (24,548)
EXPENDITURES:

Current:

Public works 247,367 258,262 239,043 19,219
Total expenditures 247,367 258,262 239,043 19,219
Net change in fund balance $ (9,771) $ 14,644 9,315 $ (5,329) FUND BALANCE:

Beginning of year 23,298
End of year $ 32,613
Budgeted Amounts
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City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Lighting/Landscape District Special Revenue Fund
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Taxes $ 95,000 $ 95,000 $ 104,584 $ 9,584
Investment earnings 100 - 86 86
Total revenues 95,100 95,000 104,670 9,670
EXPENDITURES:

Current:

Public works 175,191 184,391 155,628 28,763
Total expenditures 175,191 184,391 155,628 28,763
REVENUES OVER (UNDER) EXPENDITURES (80,091) (89,391) (50,958) 38,433 OTHER FINANCING SOURCES (USES):

Transfers in 85,000 85,000 85,000 -
Total other financing sources (uses) 85,000 85,000 85,000 - Net change in fund balance $ 4,909 $ (4,391) 34,042 $ 38,433 FUND BALANCE:

Beginning of year 11,596
End of year $ 45,638
Budgeted Amounts
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City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Recycling Fund
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Intergovernmental $ 5,000 $ 5,000 $ 5,000 $ -
Investment earnings 75 30 50 20
Total revenues 5,075 5,030 5,050 20
EXPENDITURES:

Current:

Public works - 7,200 6,940 260
Total expenditures - 7,200 6,940 260
Net change in fund balance $ 5,075 $ (2,170) (1,890) $ 280 FUND BALANCE:

Beginning of year $ 16,947
End of year 15,057
Budgeted Amounts
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City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Housing Rehab - Federal
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Investment earnings $ - $ - $ 222 $ 222
Total revenues - - 222 222
EXPENDITURES:

Current:

Public works - - 325 (325)
Total expenditures - - 325 (325)
Net change in fund balance $ - $ - (103) $ (103)
FUND BALANCE:

Beginning of year 436,039
End of year $ 435,936
Budgeted Amounts
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City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Road Maintenance and Rehab Special Revenue Fund
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Intergovernmental $ 179,063 $ 212,013 $ 207,789 $ (4,224) Investment earnings 1,000 900 1,720 820
Total revenues 180,063 212,913 209,509 (3,404)
EXPENDITURES:

Current:

General government - - - -
Total expenditures - - - -
REVENUES OVER (UNDER) EXPENDITURES 180,063 212,913 209,509 (3,404) OTHER FINANCING SOURCES (USES):

Transfers out (200,000) (499,705) - 499,705
Total other financing sources (uses) (200,000) (499,705) - 499,705 Net change in fund balance $ (19,937) $ (286,792) 209,509 $ 496,301 FUND BALANCE:

Beginning of year 359,652
End of year $ 569,161
Budgeted Amounts
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City of Calimesa
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Planning Grants Special Revenue Fund
For the year ended June 30, 2022
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:

Intergovernmental $ - $ 186,392 $ 165,797 $ (20,595)
Other 16,900 16,900 -
Total revenues - 203,292 182,697 (20,595)
EXPENDITURES:

Current:

Community services and development - 203,292 182,697 20,595 Total expenditures - 203,292 182,697 20,595
Net change in fund balance $ - $ - - $ -
FUND BALANCE:

Beginning of year -
End of year $ -
Budgeted Amounts
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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 Auditor’s Report
The Honorable Mayor and Members of the City Council
of the City of Calimesa
Calimesa, 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, each major fund, and the aggregate remaining fund information of the City of Calimesa, California, as of and for the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the City of Calimesa, California’s basic financial statements, and have issued our report thereon dated November 22, 2022.

Report on 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 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 important 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.
91 Page 141 of 251
The Honorable Mayor and Members of the City Council
of the City of Calimesa
Calimesa, California

Report on Compliance and Other Matters
As part 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 reported under Government Auditing Standards.

Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part 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.

Badawi & Associates, CPAs
Berkeley, California
November 22, 2022
92 Page 142 of 251
City of
Calimesa
Calimesa, California
Independent Accountants’ Report on
Agreed-Upon Procedures Applied to
Appropriations Limit Schedule
For the year ending June 30, 2023

Attachment 8B

INDEPENDENT ACCOUNTANTS’ REPORT
To the Honorable Mayor and City Council
of the City of Calimesa
Calimesa, California
We have performed the procedures enumerated below on the accompanying Appropriations Limit Schedule of the City of Calimesa (City) for the fiscal year ending June 30, 2023. The City’s management is responsible for the accompanying Appropriations Limit Schedule.

The City has agreed to and acknowledged that the procedures performed are appropriate to meet the intended purpose of the requirements of Section 1.5 of Article XIII-B of the California Constitution. Additionally, the League of California Cities (as presented in the publication entitled Agreed-upon Procedures Applied to the Appropriations Limitation Prescribed by Article XIII-B of the California Constitution) has agreed to and acknowledged that the procedures performed are appropriate for their purposes. This report may not be suitable for any other purpose. The procedures performed may not address all the items of interest to a user of this report and may not meet the needs of all users of this report and, as such, users are responsible for determining whether the procedures performed are appropriate for their purposes.

The procedures performed and our findings are described below:

1. We obtained the completed worksheets used by the City to calculate its appropriations limit for the fiscal year ending June 30, 2023, and determined that the limit and annual calculation factors were adopted by resolution of City Council. We also determined that the population and inflation options were selected by a recorded vote of City Council.

Finding: No exceptions were noted as a result of our procedures.

2. For the accompanying Appropriations Limit Schedule, we added the prior year’s limit to the total adjustments, and agreed the resulting amount to the current year’s limit.

Finding: No exceptions were noted as a result of our procedures.

3. We agreed the current year information presented in the accompanying Appropriations Limit Schedule to corresponding information in worksheets used by the City.

Finding: No exceptions were noted as a result of our procedures.

4. We agreed the prior year appropriations limit presented in the accompanying Appropriations Limit Schedule to the prior year appropriations limit adopted by the City Council during the prior year.

Finding: No exceptions were noted as a result of our procedures.

To the Honorable Mayor and Members of City Council
of the City of Calimesa
Calimesa, California
2 We were engaged by the City to perform this agreed-upon procedures engagement and conducted our engagement in accordance with attestation standards established by the AICPA. We were not engaged to and did not conduct an examination or review, the objective of which would be the expression of an opinion or conclusion, respectively, on the accompanying Appropriation Limit Schedule. Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you.

We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements related to our agreed-upon procedures engagement.

This report is intended solely for the information and use of the City Council and management of the City and is not intended to be and should not be used by anyone other than these specified parties. However, this report is a matter of public record, and its distribution is not limited.

Badawi & Associates, CPAs
Berkeley, California
November 22, 2022

City of Calimesa
Appropriations Limit Schedule
For the year ending June 30, 2023
Amount Source
A. Appropriations limit for the year ended June 30, 2022 $ 9,133,156 Prior year schedule B. Calculation factors:

1. Population increase % 1.0755 State Department of Finance

2. Per capita personal income change factor % 1.0337 State Department of Finance

3. Total adjustment factor % 1.1117 B3= B1 * B2
C. Annual adjustment increase 1,020,579 [(B3-1)*A)]
D. Other adjustments:

Loss responsibility (-) - N/A
Transfers to private (-) - N/A
Transfers to fees (-) - N/A
Assumed responsibility (+) - N/A
E. Total adjustments 1,020,579 (C+D)
F. Appropriations limit for the year ending June 30, 2023 $ 10,153,735 (A+E) 3

City of Calimesa
Notes to Appropriations Limit Schedule
For the year ending June 30, 2023
4 1. PURPOSE OF LIMITED PROCEDURES REVIEW
Under Article XIIIB of the California Constitution (the Gann Spending Limitation Initiative), California governmental agencies are restricted as to the amount of annual appropriations from proceeds of taxes.

Effective for years beginning on or after July 1, 1990, under Section 1.5 of Article XIIIB, the annual calculation of the appropriations limit is subject to this agreed upon procedures engagement.

2. METHOD OF CALCULATION
Under Section 10.5 of Article XIIIB, for fiscal years beginning on or after July 1990, the appropriations limit is required to be calculated based on the limit for the fiscal year 1986-1987, adjusted for the inflation and population factors discussed in Notes 3 and 4 below.

3. INFLATION FACTORS
A California governmental agency may use as its inflation factor either the annual percentage change in the 4th quarter per capita personal income (which percentage is supplied by the State Department of Finance), or the percentage change in the local assessment roll from the preceding year due to the change of local nonresidential construction. The factor adopted by the City of Calimesa for the fiscal year 2022-2023 represents the change in per capita income in the State of California.

4. POPULATION FACTORS
A California governmental agency may use as its population factor either the annual percentage change of the jurisdiction’s own population, or the annual percentage change in population in the County where the jurisdiction is located. The factor adopted by the City of Calimesa for fiscal year 2022-2023 represents the population change in the City.

5. OTHER ADJUSTMENTS
A California government agency may be required to adjust its appropriations limit when certain events occur, such as the transfer of responsibility for municipal services to, or from, another government agency or private entity. The City had no such adjustments for the fiscal year ending June 30, 2023.

December 5, 2022
To the Honorable Mayor and Members
of the City Council of the City of Calimesa
City, California
We have audited the financial statements of the City of Calimesa (City) as of and for the year ended June 30, 2022, and have issued our report thereon dated November 22, 2022. Professional standards require that we advise you of the following matters relating to our audit.

Our Responsibility in Relation to the Financial Statement Audit and the Single Audit As communicated in our engagement letter dated August 8, 2022, our responsibility, as described by professional standards, is to form and express an opinions about whether the financial statements that have been prepared by management with your oversight are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America. Our audit of the financial statements does not relieve you or management of your respective responsibilities.

Our responsibility, as prescribed by professional standards, is to plan and perform our audit to obtain reasonable, rather than absolute, assurance about whether the financial statements are free of material misstatement. An audit of financial statements includes consideration of internal control over financial reporting as a basis for designing 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 over financial reporting. Accordingly, as part of our audit, we considered the internal control of the City solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control.

We are also responsible for communicating significant matters related to the audit that are, in our professional judgment, relevant to your responsibilities in overseeing the financial reporting process.

However, we are not required to design procedures for the purpose of identifying other matters to communicate to you.

Planned Scope and Timing of the Audit
We conducted our audit consistent with the planned scope and timing we previously communicated to you.

Compliance with All Ethics Requirements Regarding Independence The engagement team, others in our firm, as appropriate, our firm, and our network firms have complied with all relevant ethical requirements regarding independence.

Attachment 8C
To the Honorable Mayor and Members
of the City Council of the City of Calimesa
Calimesa, California

Significant Risks Identified
We have identified the following significant risks:
 Risk of Management Override of Internal Controls – A risk of management override of internal controls exists at any entity where management can change or decide not to perform that entity’s internal controls.
 Revenue Recognition Risk – Errors in revenue recognition impacts determinations of available fund balance.

Qualitative Aspects of the Entity’s Significant Accounting Practices Significant Accounting Policies
Management has the responsibility to select and use appropriate accounting policies. A summary of the significant accounting policies adopted by the City is included in Note 1 to the financial statements. There have been no initial selection of accounting policies and no changes in significant accounting policies or their application during the year ended June 30, 2022. No matters have come to our attention that would require us, under professional standards, to inform you about (1) the methods used to account for significant unusual transactions and (2) the effect of significant accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus.

Significant Accounting Estimates
Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s current judgments. Those judgments are normally based on knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ markedly from management’s current judgments.

The most sensitive accounting estimates affecting the financial statements are investment valuations, capital asset depreciation and useful life, and pension plan actuarial assumptions.

Management’s estimate of investment valuations, capital assets depreciation and useful life, and pension plan actuarial assumptions are based on historical useful lives of such assets, actuarial assumptions, and reports published by the Local Agency Investment Fund (LAIF), respectively. We evaluated the key factors and assumptions used to develop the estimate of investment valuations, capital assets depreciation and useful life, and pension plan assumptions and determined that they are reasonable in relation to the basic financial statements taken as a whole and in relation to the applicable opinion units.

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

Financial Statement Disclosures
Certain financial statement disclosures involve significant judgment and are particularly sensitive because of their significance to financial statement users. The most sensitive disclosures affecting the City’s financial statements relate to:
 Summary of Significant Accounting Policies
 Cash and Investments
 Long-term Debt
 Capital Assets
 Employee Retirement Plans
 Conduit Debt
Significant Difficulties Encountered during the Audit
We encountered no significant difficulties in dealing with management relating to the performance of the audit.

Uncorrected and Corrected Misstatements
For purposes of this communication, professional standards also require us to accumulate all known and likely misstatements identified during the audit, other than those that we believe are trivial, and communicate them to the appropriate level of management. Further, professional standards require us to also communicate the effect of uncorrected misstatements related to prior periods on the relevant classes of transactions, account balances or disclosures, and the financial statements as a whole and each applicable opinion unit. Uncorrected misstatements or matters underlying those uncorrected misstatements could potentially cause future-period financial statements to be materially misstated, even though the uncorrected misstatements are immaterial to the financial statements currently under audit.

In addition, professional standards require us to communicate to you all material, corrected misstatements that were brought to the attention of management as a result of our audit procedures. No material misstatements were identified during the audit.

Disagreements with Management
For purposes of this letter, professional standards define a disagreement with management as a matter, whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter, which could be significant to the City’s financial statements or the auditor’s report.

No such disagreements arose during the course of the audit.

Representations Requested from Management
We have requested certain written representations from management, which are included in the attached letter dated November 22, 2022.

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

Management’s Consultations with Other Accountants
In some cases, management may decide to consult with other accountants about auditing and accounting matters. Management informed us that, and to our knowledge, there were no consultations with other accountants regarding auditing and accounting matters.

Other Significant Matters, Findings, or Issues
In the normal course of our professional association with the City, we generally discuss a variety of matters, including the application of accounting principles and auditing standards, significant events or transactions that occurred during the year, operating and regulatory conditions affecting the entity, and operational plans and strategies that may affect the risks of material misstatement. None of the matters discussed resulted in a condition to our retention as the City’s auditors.

Required Supplementary Information
We applied certain limited procedures to the required supplementary information (RSI) that supplements the basic financial statements. Our procedures consisted of inquiries of management regarding 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 did not audit the RSI and do not express an opinion or provide any assurance on the RSI.

Supplementary Information
We were engaged to report on the combining and individual nonmajor fund statements and budgetary comparison schedules nonmajor governmental funds (supplementary information) which accompany the financial statements but are not RSI. With respect to this supplementary information, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves.

This report is intended solely for the information and use of the City Council, and management of the City and is not intended to be and should not be used by anyone other than these specified parties.

Badawi & Associates, CPAs
Berkeley, California
December 5, 2022

City of Calimesa
908 Park Avenue, Calimesa, California 92320
Telephone 909.795.9801 Facsimile 909.795.4399
www.cityofcalimesa.net
“Preserving and enhancing the open space atmosphere and quality of life in Calimesa”
November 22nd, 2022
Badawi & Associates, CPAS
2855 Telegraph Avenue, Suite 312
Berkeley, CA 94705
This representation letter is provided in connection with your audit(s) of the financial statements of City of Calimesa (City), which comprise the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information as of June 30, 2022, and the respective changes in financial position for the year then ended, and the disclosures (collectively, the “financial statements”), for the purpose of expressing opinions as to whether the financial statements are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).

Certain representations in this letter are described as being limited to matters that are material.

Items are considered material, regardless of size, if they involve an omission or misstatement of accounting information that, in light of surrounding circumstances, makes it probable that the judgment of a reasonable person relying on the information would be changed or influenced by the omission or misstatement. An omission or misstatement that is monetarily small in amount could be considered material as a result of qualitative factors.

We confirm, to the best of our knowledge and belief, as of November 22nd, 2022, the following representations made to you during your audit.

Financial Statements
1) We have fulfilled our responsibilities, as set out in the terms of the audit engagement letter dated August 8, 2022, including our responsibility for the preparation and fair presentation of the financial statements in accordance with U.S. GAAP and for preparation of the supplementary information in accordance with the applicable criteria. 2) The financial statements referred to above are fairly presented in conformity with U.S. GAAP and include all properly classified funds and other financial information of the primary government and all component units required by generally accepted accounting principles to be included in the financial reporting entity.
3) We acknowledge our responsibility for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. 4) We acknowledge our responsibility for the design, implementation, and maintenance of internal control to prevent and detect fraud.

DocuSign Envelope ID: D7C95520-2874-45BF-80B4-86F0CDDA04F6

5) Significant assumptions we used in making accounting estimates, including those measured at fair value, are reasonable.
6) Related party relationships and transactions, including revenues, expenditures/expenses, loans, transfers, leasing arrangements, and guarantees, and amounts receivable from or payable to related parties have been appropriately accounted for and disclosed in accordance with U.S. GAAP.
7) Adjustments or disclosures have been made for all events, including instances of noncompliance, subsequent to the date of the financial statements that would require adjustment to or disclosure in the financial statements. 8) The effects of all known actual or possible litigation, claims, and assessments have been accounted for and disclosed in accordance with U.S. GAAP. 9) Guarantees, whether written or oral, under which the City is contingently liable, if any, have been properly recorded or disclosed.

Information Provided
10) We have provided you with:
a) Access to all information, of which we are aware, that is relevant to the preparation and fair presentation of the financial statements, such as records (including information obtained from outside of the general and subsidiary ledgers), documentation, and other matters.
b) Additional information that you have requested from us for the purpose of the audit. c) Unrestricted access to persons within the City from whom you determined it necessary to obtain audit evidence.
d) Minutes of the meetings of the City Council or summaries of actions of recent meetings for which minutes have not yet been prepared.
11) All material transactions have been recorded in the accounting records and are reflected in the financial statements.
12) We have disclosed to you the results of our assessment of the risk that the financial statements may be materially misstated as a result of fraud.
13) We have no knowledge of any fraud or suspected fraud that affects the City and involves—  Management,
 Employees who have significant roles in internal control, or  Others where the fraud could have a material effect on the financial statements. 14) We have no knowledge of any allegations of fraud or suspected fraud affecting the City’s financial statements communicated by employees, former employees, regulators, or others. 15) We have no knowledge of instances of noncompliance or suspected noncompliance with provisions of laws, regulations, contracts, or grant agreements, or waste or abuse, whose effects should be considered when preparing financial statements.

DocuSign Envelope ID: D7C95520-2874-45BF-80B4-86F0CDDA04F6

16) We have disclosed to you all known actual or possible litigation, claims, and assessments whose effects should be considered when preparing the financial statements. 17) We have disclosed to you the names of the City’s related parties and all the related party relationships and transactions, including any side agreements.

Government-specific
18) There have been no communications from regulatory agencies concerning noncompliance with, or deficiencies in, financial reporting practices. 19) We have identified to you any previous audits, attestation engagements, and other studies related to the objectives of the audit and whether related recommendations have been implemented.
20) We have identified to you any investigations or legal proceedings that have been initiated with respect to the period under audit.
21) The City has no plans or intentions that may materially affect the carrying value or classification of assets, deferred outflows of resources, liabilities, deferred inflows of resources, and fund balance or net position.
22) We are responsible for compliance with the laws, regulations, and provisions of contracts and grant agreements applicable to us, including tax or debt limits and debt contracts, and legal and contractual provisions for reporting specific activities in separate funds. 23) We have appropriately disclosed all information for conduit debt obligations in accordance with GASBS No. 91 .
24) We have identified and disclosed to you all instances of identified and suspected fraud and noncompliance with provisions of laws, regulations, contracts, and grant agreements that we believe have a material effect on the financial statements. 25) There are no violations or possible violations of budget ordinances, laws and regulations (including those pertaining to adopting, approving, and amending budgets), provisions of contracts and grant agreements, tax or debt limits, and any related debt covenants whose effects should be considered for disclosure in the financial statements, or as a basis for recording a loss contingency, or for reporting on noncompliance. 26) As part of your audit, you assisted with preparation of the financial statements and disclosures. We acknowledge our responsibility as it relates to those nonaudit services, including that we assume all management responsibilities; oversee the services by designating an individual, preferably within senior management, who possesses suitable skill, knowledge, or experience; evaluate the adequacy and results of the services performed; and accept responsibility for the results of the services. We have reviewed, approved, and accepted responsibility for those financial statements and disclosures. 27) The City has satisfactory title to all owned assets, and there are no liens or encumbrances on such assets nor has any asset been pledged as collateral. 28) The City has complied with all aspects of contractual agreements that would have a material effect on the financial statements in the event of noncompliance.

DocuSign Envelope ID: D7C95520-2874-45BF-80B4-86F0CDDA04F6

29) The financial statements include all component units, appropriately present majority equity interests in legally separate organizations and joint ventures with an equity interest, and properly disclose all other joint ventures and other related organizations. 30) The financial statements include all fiduciary activities required by GASBS No. 84 , as amended.
31) The financial statements properly classify all funds and activities in accordance with GASBS No. 34 , as amended.
32) All funds that meet the quantitative criteria in GASBS Nos. 34 and 37 for presentation as major are identified and presented as such and all other funds that are presented as major are particularly important to financial statement users.
33) Components of net position (net investment in capital assets; restricted; and unrestricted) and classifications of fund balance (nonspendable, restricted, committed, assigned, and unassigned) are properly classified and, if applicable, approved. 34) Investments, derivative instrument transactions, and land and other real estate held by endowments are properly valued.
35) Provisions for uncollectible receivables have been properly identified and recorded. 36) Expenses have been appropriately classified in or allocated to functions and programs in the statement of activities, and allocations have been made on a reasonable basis. 37) Revenues are appropriately classified in the statement of activities within program revenues, general revenues, contributions to term or permanent endowments, or contributions to permanent fund principal.
38) Interfund, internal, and intra-entity activity and balances have been appropriately classified and reported.
39) Deposits and investment securities and derivative instrument transactions are properly classified as to risk and are properly disclosed.
40) Capital assets, including infrastructure and intangible assets, are properly capitalized, reported, and, if applicable, depreciated or amortized. 41) We have appropriately disclosed the City’s policy regarding whether to first apply restricted or unrestricted resources when an expense is incurred for purposes for which both restricted and unrestricted net position is available and have determined that net position is properly recognized under the policy.
42) We are following our established accounting policy regarding which resources (that is, restricted, committed, assigned, or unassigned) are considered to be spent first for expenditures for which more than one resource classification is available. That policy determines the fund balance classifications for financial reporting purposes. 43) We acknowledge our responsibility for the required supplementary information (RSI). The RSI is measured and presented within prescribed guidelines and the methods of measurement and presentation have not changed from those used in the prior period. We have disclosed to you any significant assumptions and interpretations underlying the measurement and presentation of the RSI.

DocuSign Envelope ID: D7C95520-2874-45BF-80B4-86F0CDDA04F6

44) With respect to the supplementary information on which an in-relation-to opinion is issued a) We acknowledge our responsibility for presenting the supplementary information in accordance with accounting principles generally accepted in the United States of America, and we believe the supplementary information, including its form and content, is fairly presented in accordance with accounting principles generally accepted in the United States of America. The methods of measurement and presentation of the supplementary information have not changed from those used in the prior period, and we have disclosed to you any significant assumptions or interpretations underlying the measurement and presentation of the supplementary information.
b) If the supplementary information is not presented with the audited financial statements, we will make the audited financial statements readily available to the intended users of the supplementary information no later than the date we issue the supplementary information and the auditor’s report thereon.

Signature: Signature:

Title: Title:

DocuSign Envelope ID: D7C95520-2874-45BF-80B4-86F0CDDA04F6 Finance Director City Manager

City Council Meeting
Agenda Report
Agenda Item No. 9
Agenda Item No. x
SUBJECT: AN ORDINANCE OF THE CITY OF CALIMESA ADOPTING BY REFERENCE THE 2022 EDITIONS OF THE CALIFORNIA FIRE

CODE WITH CERTAIN AMENDMENTS THERETO AND
AMENDING TITLE 15 OF THE CALIMESA MUNICIPAL CODE

REGARDING THE SAME
MEETING DATE: December 19, 2022
PREPARED BY: Tim O’Connell, Calimesa Fire Chief
RECOMMENDATION: That the City Council open the public hearing, take public testimony and approve second reading, by title only, adopting Ordinance No.387 - An Ordinance of the City Council of the City of Calimesa Adopting by Reference the 2022 Editions of the California Fire Code with Certain Amendments Thereto and Amending Title 15 of ohe Calimesa Municipal Code Regarding the Same.

BACKGROUND: Every three years, the State adopts new model codes (known collectively as the California Building Standards Code) to establish uniform standards for the construction and maintenance of buildings. This includes the California Fire Code, which must in turn be adopted or utilized by each city or county. Cities may establish more restrictive building standards reasonably necessary because of local climatic, geological or topographical conditions. Findings of the local condition(s) and the adopted local building standard(s) must be filed with the California Building Standards Commission. Such findings are not necessary for local amendments that are only administrative.To adopt the 2022 edition California Fire Code, the Ordinance is introduced for first ready by title only and a public hearing is set for a later date for second reading and adoption. At the November 21, 2022 meeitng, Council introduced for first ready, by title only Ordinance No. 387 and set the public hearing date for December 19, 2022. The Notice of Public Hearing was published for two successive weeks in the Yucaipa/Calimesa News Mirror. Once the adoption is completed, the findings of local condition(s), if necessary, and the adopted local building standard(s) will be filed with the California Building Standards Commission.

DISCUSSION: The City of Calimesa Fire Department is responsible for providing fire suppression, emergency medical services, and fire marshal services within the City’s jurisdiction and recommends adoption of the 2022 Fire Code, subject to certain amendments that would be incorporated into Chapter

15.10 of Title 15 of the Calimesa Municipal Code.

The first of these amendments would designate the City Manager as the appellate reviewing authority for the purposes of the Fire Code and require the Fire Chief be notified of and attend any appeal hearing.

“The Board of Appeals shall be the City Manager. If he or she determines an outside board is needed, he or she shall designate an outside hearing officer to hear the appeal. The Fire Chief shall be notified of any appeal and the Fire Chief or his or her designee shall be in attendance at the appeal hearing.

Depending on the subject of the appeal, specialized expertise may be solicited, at the expense of the applicant, for the purpose of providing input to the Appeals Board.”
The second of these amendments would establish that violations of the Fire Code are subject to punishment or remedy as provided in Title 1 of the Municipal Code, which includes misdemeanor prosecution and administrative citations.
“Violations of any provision of this chapter or the provisions of any permit granted pursuant to this chapter shall be subject to punishment or remedy as provided in Title 1 of the Municipal Code.”
If the City Council introduces the Ordinance, it can can schedule the public hearing for December 19, 2022.

ENVIRONMENTAL: Adoption of the Ordinance is categorically exempt from environmental review as a Class 8 Exemption pursuant to Section 15308 of the California Environmental Quality Act Guidelines (California Code of Regulations, Title 14, Chapter 3). It is further exempt in that there is no possibility that the adoption of this Ordinance, and the regulations established thereby, may have a significant effect on the environment, because the Ordinance will impose greater limitations on development in the City, and will thereby serve to reduce potential significant adverse environmental impacts. It is therefore exempt from California Environmental Quality Act review pursuant to Title 14, Section 15061(b)(3) of the California Code of Regulations.

ATTACHMENTS:

Attachment A: Ordinance No. 387

1 ORDINANCE NO. 387

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CALIMESA ADOPTING BY REFERENCE THE 2022 EDITIONS OF THE

CALIFORNIA FIRE CODE WITH CERTAIN AMENDMENTS THERETO
AND AMENDING TITLE 15 OF THE CALIMESA MUNICIPAL CODE

REGARDING THE SAME

THE CITY COUNCIL OF THE CITY OF CALIMESA DOES ORDAIN AS FOLLOWS:

SECTION 1. Certain model and uniform codes, including the 2022 California Fire Code located within Title 24 of the California Code of Regulations and including building standards therein, are adopted and amended by the State of California in the 2022 California Building Standards Code. On January 1, 2023, the 2022 California Building Standards Code will become applicable in the City, subject to amendments set forth in this Ordinance.

SECTION 2. Chapter 15.10 (“Adoption of the 2022 Edition of the California Fire Code”) of Title 15 (“Buildings and Construction”) of the Municipal Code of the City of Calimesa is hereby amended and restated in its entirety to read as follows:
“Chapter 15.10
ADOPTION OF THE 2022 EDITION OF THE CALIFORNIA

FIRE CODE

15.10.010. Adoption of the California Fire Code, 2022 Edition.

Pursuant to the provisions of sections 50022.1 to 50022.10, inclusive, of the Government Code of the State and subject to the particular additions, deletions, amendments set forth in this chapter, the rules, regulations, provisions, standards, and conditions set forth in that certain Code known as the 2022 Edition of the California Fire Code published by the International Code Council and the California Building Standards Commission with errata, including appendices B, BB, C, CC, D, E, F, G, H, I, J, K, L, N and O, inclusive of all of the inclusions and exclusions set forth in each chapter’s matrix, are hereby adopted by reference and shall apply within the City of Calimesa, and the same are collectively designated and may be known and referenced to as the “Fire Code” of the City of Calimesa.

15.10.020. Amendments
A. Section 111.1 of the California Fire Code is amended and restated in its entirety to read as follows:
111.1 Board of appeals established. The Board of Appeals shall be the City Manager. If he or she determines an outside board is needed, he or she shall designate an outside hearing officer to hear

Attachment 9A
2 the appeal. The Fire Chief shall be notified of any appeal and the Fire Chief or his or her designee shall be in attendance at the appeal hearing. Depending on the subject of the appeal, specialized expertise may be solicited, at the expense of the applicant, for the purpose of providing input to the Appeals Board.

B. Section 112.4 of the California Fire Code is amended and restated in its entirety to read as follows: :
112.4 Violation penalties. Violations of any provision of this chapter or the provisions of any permit granted pursuant to this chapter shall be subject to punishment or remedy as provided in Title 1 of the Municipal Code.

15.10.030. Regulation of building construction.

Any and all of the regulations, provisions, and building standards set forth in the Calimesa Fire Code, as adopted in Calimesa Municipal Code Section

15.10.010, together with the provisions of the Calimesa building code, as adopted in Chapter 15.05 Calimesa Municipal Code, and otherwise as provided in Title 15 of the Calimesa Municipal Code, shall govern and regulate the erection, construction, enlargement, alteration, repair, moving, removal, demolition, conversion, occupancy, equipment, use, height, area and/or maintenance of all buildings or structures within the City.” SECTION 3. Severability. If any section, subsection, sentence, clause, phrase or portion of this Ordinance for any reason is held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council of the City of Calimesa hereby declares that it would have adopted this Ordinance and each section, subsection, clause, phrase or portion thereof irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases or portions were to be declared invalid or unconstitutional.

SECTION 4. CEQA. The adoption of this Ordinance is categorically exempt from environmental review as a Class 8 Exemption pursuant to Section 15308 of the California Environmental Quality Act Guidelines (California Code of Regulations, Title 14, Chapter 3). It is further exempt in that there is no possibility that the adoption of this Ordinance, and the regulations established thereby, may have a significant effect on the environment, because the Ordinance will impose greater limitations on development in the City, and will thereby serve to reduce potential significant adverse environmental impacts. It is therefore exempt from California Environmental Quality Act review pursuant to Title 14, Section 15061(b)(3) of the California Code of Regulations.

3 SECTION 5. Publication. The City Clerk shall certify to the adoption of this Ordinance and cause the same to be published as required by law.

INTRODUCED AND PASSED UPON FIRST READING by title only this 21st day of November 2022, upon the following vote:

AYES: Davis, Duvall and Molina
NOES: None
ABSENT: Cervantez and Hewitt
ABSTAIN: None
PASSED, APPROVED AND ADOPTED this 19th day of December 2022 upon the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
___________________________________

WILLIAM DAVIS, MAYOR
ATTEST:
___________________________________

DARLENE GERDES, CITY CLERK
APPROVED AS TO FORM:
___________________________________

QUINN BARROW, CITY ATTORNEY

City Council Meeting
Agenda Report
Agenda Item No. 10
SUBJECT: PUBLIC HEARING TO CONSIDER APPEAL OF THE PLANNING COMMISSION’S CONDITIONS OF APPROVAL FOR
DEVELOPMENT PLAN REVIEW 22-03 – APPROVAL TO
RELOCATE SOUTH MESA WATER COMPANY WELL NO. 11 AND
REPLACE APPROXIMATELY 24,533 LINEAR FEET OF WATER

MAIN LINES AND RELATED APPURTENANCES
MEETING DATE: December 19, 2022
PREPARED BY: Kelly Lucia, Planning Director
Mike Thornton, City Engineer
RECOMMENDATION: That the City Council adopt CC Resolution 2022-75, Approving Development Plan Review 22-03 (as revised through appeal).

BACKGROUND/DISCUSSION: On July 18, 2022 the City Council approved a Memorandum of Understanding (“MOA”) with South Mesa Water Company (“SMWC”) to assist SMWC with in obtaining a State grant for a pipeline replacement project on County Line Road and Well 11 relocation in Calimesa as well as an unrelated project in Yucaipa. Calimesa agreed to act as the “lead agency” for CEQA purposes and waive all fees leading up to Planning Commission approval.

In exchange, SMWC would dedicate right-of-way needed for Calimesa and Yucaipa to construct improvements to the intersection of Calimesa Blvd. and County Line Road.

On August 22, 2022, the Planning Commission approved the relocation of SMWC Well No. 11 (located at APN: 411-080-005) and replacement of approximately 24,533 linear feet of water system main lines and 25,696 linear feet of appurtenance and service pipes located along County Line Road extending approximately from the I-10 east bound exit to Douglas Place. The pipeline replace is expected to occur in both the cities of Calimesa and Yucaipa, extending short distances into intersecting roadways including Calimesa Boulevard, 5th Street, 4th Street, 3rd Street, 2nd Street, California Street, and Bryant Street. The Planning Commission approved an addendum to the initial study/mitigated negative declaration completed for the County Line Road Transportation Corridor project (SCH#2019109030), pursuant to CEQA Guidelines Sections 15162 and 15164. Approval of the addendum has not been appealed and is now final.

The Applicant (SMWC) challenged various conditions of approval associated with DPR 22-03, and, pursuant to Calimesa Municipal Code Section 18.15.080.G.2, filed an appeal to the City Council.

The reason for the appeal was SMWC’s claim that the conditions of approval were not consistent with the MOA adopted by City Council on July 18, 2022.

Staff coordinated extensively with SMWC to prepare mutually acceptable conditions of approval for the Project, which are recommended for approval through adoption of CC Resolution 2022-75 The two main salient issues were:
• Payment of Fees after entitlement
• Obtaining permits from the City as required by the Calimesa Municipal Code.

The Resolution and revised conditions of approval represent an acceptable compromise to both the City staff and SMWC.

FISCAL IMPACT: In accordance with Section IV-1 of the Memorandum of Agreement, and all costs associated with Development Plan Review 22-03 ,the preparation of the Addendum to the initial study/mitigated negative declaration to the County Line Road Transportation Corridor project (SCH#2019109030), and the relocation of SMWC services as part of the City’s County Line Road Corridor Improvement Project were borne by the City. SMWC will pay City processing fees not-toexceed $15,000 going forward.

ATTACHMENTS:

Attachment A: Resolution No. 2022-75
Attachment B: Memorandum of Agreement

RESOLUTION NO. 2022-75

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CALIMESA APPROVING DEVELOPMENT PLAN REVIEW 22-03
(AS REVISED BY APPEAL) TO RELOCATE SOUTH MESA
WATER COMPANY WELL NO. 11 AND REPLACE
APPROXIMATELY 24,533 LINEAR FEET OF WATER MAIN LINES

AND RELATED APPURTENANCES WITHIN COUNTY LINE
ROAD FROM APPROXIMATELY I-10 EASTBOUND OFF-RAMP

TO DOUGLAS PLACE, AND APPROVING AN ADDENDUM TO

THE INITIAL STUDY/MITIGATED NEGATIVE DECLARATION

COMPLETED FOR THE COUNTY LINE ROAD
TRANSPORTATION CORRIDOR PROJECT (SCH#2019109030),
PURSUANT TO CEQA GUIDELINES SECTIONS 15162
THROUGH 15164, TO BE LOCATED ON .12 ACRES AT THE

SOUTHWEST CORNER OF COUNTY LINE ROAD AND
CALIMESA BOULEVARD AT APN: 411-080-005 WITHIN THE

DOWNTOWN VILLAGE COMMERCIAL AND CALIMESA CREEK

OVERLAY ZONE AREA (WELL RELOCATION) AND WITHIN

EXISTING ROAD RIGHT OF WAY (PIPELINE REPLACEMENT)
The City Council of the City of Calimesa hereby finds and determines that:

WHEREAS, After a duly noticed public hearing on August 22, 2022, the Calimesa Planning Commission adopted PC Resolution 2022-09, approving an application submitted by South Mesa Water Company (“SMWC” or the "Applicant") for Development Plan Review (DPR 22-03), subject to conditions, for the following project: (1) the relocation of SMWC Well No. 11; and (2) the replacement of approximately 24,533 linear feet of water main lines and related appurtenances within County Line Road from approximately the I-10 eastbound off-ramp to Douglas Place, to be located at the southwest corner of County Line Road and Calimesa Boulevard at APN 411-080-005 (well relocation) and along County Line Road within existing road right of way (pipeline replacement) (collectively, “the Project”); and, WHEREAS, in connection with its approval, and pursuant to the California Environmental Quality Act (CEQA), the Planning Commission: (1) approved an Addendum to an Initial Study/Mitigated Negative Declaration (IS/MND) adopted by the City Council on December 2, 2019 in connection with a Local Partnership Program (“LPP”) to construct a roadway corridor, drainage, and related improvements to install five roundabouts on County Line Road from Park Avenue to Bryant Street (the “County Line Road Transportation Corridor Project or “LPP Project”), and (2) re-adopted the Mitigation Monitoring and Reporting Program (MMRP) previously included in and approved as part of the adopted IS/MND; and, WHEREAS, the Planning Commission recitals and findings set forth in PC Resolution 2022-09 are hereby adopted by the City Council and incorporated by this reference, and WHEREAS, the Applicant has submitted an appeal of the Commission’s decision, seeking clarification of certain conditions; and,

Attachment 10A
WHEREAS, neither the Applicant nor any other person has filed a timely appeal of the approval of the Addendum or the adoption of the MMRP, and thus all CEQA determinations related to this Project are final; and,
WHEREAS, on July 18, 2022, the Calimesa City Council approved a Memorandum of Agreement (MOA) between the City and SMWC; and,
WHEREAS, Section IV.1 of the MOA provides, in relevant part, that City will “credit SMWC all applicable City application fees” for the DPR Application and MND Addendum; and, WHEREAS, in accordance with Section IV.1 of the MOA, the City has not charged SMWC any City application fees associated with processing and approving SMWC’s application for DPR 22-03 and MND Addendum, including staff review time, City Engineer review time, CEQA consultant fees, and legal review fees; and,
WHEREAS, Section V of the MOA provides that “the City and SMWC each agree to pay their own costs associated with this MOA”; and,
WHEREAS, in accordance with Section V of the MOA, the City and SMWC have paid their own costs associated with the MOA, including staff, engineer, and attorney time preparing and drafting the MOA prior to the City Council’s approval of the MOA; and,

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CALIMESA DOES HEREBY FIND, DETERMINE AND RESOLVE AS FOLLOWS:

Section 1. The City Council finds that the recitals contained in this Resolution, PC Resolution 2022-09, and the information contained in the attached exhibits are true and correct, and are hereby incorporated by this reference.

Section 2. The Calimesa Planning Commission made certain findings in adopting PC Resolution 2022-09 approving DPR 22-03. The City Council hereby adopts the Commission’s findings, and such findings are hereby incorporated by this reference.

Section 3. Based on the City Council’s independent judgment and substantial evidence in the whole of the record, as described in Sections 1-2 above, the City Council hereby finds that the Project complies with CEQA based on each of the provisions set forth in Sections 4 and 5 of PC Resolution No. 2022-09, each of which, separately and independently, provides a basis for CEQA compliance, and which are hereby incorporated by this reference.

Section 4. Alternatively, based on the City Council’s independent judgment and substantial evidence in the whole of the record, as described in Sections 1-3 above, the City Council finds that the Project does not require the preparation of a subsequent or supplemental environmental impact report, and that an addendum to the certified IS/MND is appropriate, consistent with Section 15164 (Addendum to EIRs or Negative Declarations) of the CEQA Guidelines, as found by the Planning Commission in PC Resolution No. 2022-09. The Commission’s findings set forth in Sections 6 and 7 of PC Resolution No. 2022-09 are hereby incorporated by this reference.

Section 5. Based on the foregoing, the City Council hereby approves Development Plan Review 22-03, for the SMWC Well No. 11 relocation and County Line Road Water Line Replacement Project, subject to the terms and provisions of the MOA and conditions of approval set forth in Attachment A to this resolution, and subject to the Mitigation Measures/Project Design Features attached to PC Resolution No. 2022-09 and incorporated herein by this reference as though set forth in full.

PASSED, APPROVED AND ADOPTED, this 19th day of December 2022. ________________________________________

WILLIAM DAVIS, MAYOR
ATTEST:
_____________________________________

DARLENE GERDES, CITY CLERK

ATTACHMENT A
DEVELOPMENT PLAN REVIEW DPR 22-03
CITY COUNCIL RESOLUTION 2022-75

CONDITIONS OF APPROVAL

CONDITIONS OF APPROVAL
Planning Application Number and Description: DPR 22-03
Assessor's Parcel Number: 411-080-005 and Road Right of Way Planning Commission Date: August 22, 2022
City Council Appeal Hearing Date: December 19, 2022
The Project includes two components: (1) the Well No. 11 relocation, hereinafter called “Relocation” and, (2) Water Line Replacement, hereinafter called “Replacement”. The following Conditions of Approval have been annotated to identify those conditions that apply to either the Relocation, the Replacement or “Both”.
# Conditions of Approval Dept Status
1) General Conditions

1.01 Both
The Applicant agrees to indemnify, protect, defend,
and hold harmless the City, and agency or
instrumentality thereof, and its elected and
appointed officials, officers, employees and agents,
from and against any and all liabilities, claims,
actions, causes or action, proceeding, suits,
damages, judgments, liens, levies, costs and
expenses of whatever nature, including reasonable
attorney's fees and disbursements (collectively,
Claims ) arising out of or in any way relating to the
issuance of the entitlement, any actions taken by the
City related to this entitlement or the environmental
review conducted under the California
Environmental Quality Act, Public Resources Code
Section 21000 et seq., for this entitlement and
related actions, as applicable.

Planning
Not
Satisfied

Exhibit A of City Council Resolution 2022-75
DPR 22-03

1.02 Relocation
All landscaping areas visible from any public way
shall be properly maintained such that they are
evenly cut, evenly edged, free of bare or brown
spots, debris, and weeds. All trees and shrubs shall
be trimmed so they do not impede vehicular or
pedestrian traffic. Trees shall be pruned so they do
not intrude into neighboring properties and shall be
maintained so they do not have excessive droppings
or create other nuisances to neighboring properties.

All trees shall also be root pruned to eliminate
exposed surface roots and damage to sidewalks,
driveways, and structures.

Planning Not
Satisfied

1.03 Both
All mitigation measures/project design features
within the Initial Study/Mitigated Negative
Declaration and Addendum attached hereto are
made a part of these conditions of approval. All
costs of supervising and conducting the Mitigation
Monitoring Program shall be borne by the Applicant
(SCH # 2019109030), as applicable.

Planning Not
Satisfied

1.04 Relocation
The development of this property shall substantially
conform to the Site Plan, Elevations, Floor Plans,
and Landscape Plans approved by the City of
Calimesa on August 22, 2022.

Planning Not
Satisfied

1.05 Both
Approval of Development Plan Review 22-03 is
contingent upon the property owner and applicant
signing and returning to the Community
Development Department the "Agreement to
Conditions Imposed" form at the end of this exhibit.

Planning Not
Satisfied

1.06 Both
The approved project consists of replacement of
approximately 24,533 linear feet of water main lines
and related appurtenances along County Line Road
from the I-10. County Line Road interchange to
Douglas Place, within the Cities of Calimesa and
Yucaipa. The pipeline replacement would extend
short distances into intersecting roadways including
Calimesa Boulevard, 5th Street, 4th Street, 3rd Street, 2 nd Street, California Street, and Bryant Street. The
project also includes the relocation of South Mesa
Water Company Well No. 11 located at the
southwest corner of County Line Road / Calimesa
Boulevard at APN: 411-080-005).

Planning N/A

1.07 Both
The mitigation measures required by the project
Initial Study/Mitigation Negative
Declaration/Addendum are MM CR 1 and MM CR
2, MM GEO 1, MM HYDRO 1, MM NOISE 1
Planning Not
Satisfied

Exhibit A of City Council Resolution 2022-75
DPR 22-03

through MM NOISE 4, MM TRANS 1, and MM
TCR 1 through TCR 6.

1.08 Both
Pursuant to the timing specified in the applicable
ordinance(s), the applicant shall pay all fees in
accordance with the regulations in effect at the time
of permit issuance including but not limited to the
City of Calimesa Development Impact Fees, the
Multiple Species Habitat Conservation (MSHCP
Fee, and the Transportation Uniform Mitigation Fee
(TUMF). The applicant acknowledges it is their
responsibility to obtain the most current fee
schedule from the Community Development
Department.

Planning Satisfied

1.09 Relocation
This project will require one or more building
permits. Permits will require a permit application
and complete building plans to be submitted for
approval prior to commencement of work,
specifically, grading for the well site, construction
of the well building, construction of the perimeter
screen wall, tree removal (if the amount of trees to
be removed is in excess of five), and installation of
landscape and irrigation.

Building and
Safety
Not
Satisfied

1.10 Relocation
The site shall be developed in compliance with all
current model codes. All plans shall be designed in
compliance with the latest editions of the California
Building Codes as adopted by the City of Calimesa.

Building and
Safety
Not
Satisfied

1.11 Relocation
The structure(s) shall comply with all structural and
non-structural provisions of the California Building
Codes as adopted by the City of Calimesa
Building and
Safety
Not
Satisfied

1.12 Relocation
Pursuant to California Business and Professions
Code Section 6737, this project is required to be
designed by a California licensed architect or
engineer.

Building and
Safety
Not
Satisfied

1.13 Relocation
The Fire Prevention Department does not have
conditions of approval. Fire Marshal N/A

1.14 Relocation
The Sheriff Department does not have conditions of
approval.

Riverside
County
Sheriff
N/A

1.15 Relocation
Applicant shall procure recovered organic waste
products where applicable on behalf of the City and
provide written documentation of such procurement
to the City. Any mulch utilized on the project shall
comply with 14 CCR Section 18993.1(e).

Public Works Not
Satisfied

1.16 Relocation
All applicable Ordinances, Policy Resolutions, and
Standards of the City in effect at the time this project Engineering NotSatisfied

Exhibit A of City Council Resolution 2022-75
DPR 22-03

is approved, shall be complied with as a condition
of this approval.

1.17 Relocation
All public street and drainage improvements shall
be designed in compliance with all appropriate
Federal, State, County, and/or City standards.

Preference shall be given to the use of Riverside
County Transportation Department construction
standards. Use of other standards, i.e., Caltrans,
APWA, and other shall be approved on a case-bycase basis.

Engineering Not
Satisfied

1.18 Relocation
City project account review shall be performed to
determine if any outstanding fees are owed, and
such outstanding fees shall be paid.

Engineering Not
Satisfied

1.19 Relocation
The Applicant is required to provide for the
perpetual maintenance of the following items:
onsite drainage facilities including storm drainpipes
and inlets; and on-site drive isles, parking areas,
signing and striping, landscaping, and fences.

Engineering Not
Satisfied

1.20 Relocation
The Applicant shall be required to construct the
proposed offsite catch basin and RCP outlet
connecting from the catch basin to the City Storm
Drain System. Upon completion and acceptance of
construction of these improvements, the Applicant
will dedicate the facilities to the City. Additional
coordination between the City and Applicant to
occur, to include possible in lieu fee payment for the
cost of these improvements.

Engineering Not
Satisfied

1.21 Relocation
Contractors are required to arrange for a preconstruction meeting concurrently with the issuance of any permits.

Engineering Not
Satisfied

1.22 Relocation
Applicant shall employ a qualified professional
engineering firm to perform design services. All
construction plans shall be prepared on 24”X36”
drawing sheets with the City standard title block.

Engineering Not
Satisfied

1.23 Relocation
Project improvement plans and reports shall be
submitted for plan check to the Engineering
Department for review and approval by the City
Engineer. Public and private improvement plans
shall be submitted as a complete package including
grading, erosion, drainage, water, hydrology and
hydraulics study, soils report, reference and backup
documents and any other plans or reports as
required by these conditions of approval.

Incomplete submittals shall be rejected. Plan check
fees/deposits shall be submitted with the plan check
All Not
Satisfied

Exhibit A of City Council Resolution 2022-75
DPR 22-03

submittal package based on the latest adopted fee
schedule.

1.24 Both
Any storm drain conflicts or changes to the
approved plans that occur during construction shall
be provided immediately to the Public Works
Director and the City Engineer.

Engineering Not
Satisfied
2) Prior to a Certain Date

2.01 Both
This conditionally approved Development Plan Review
shall expire twenty-four months from the date of
approval, unless extended as provided for in the
Calimesa Municipal Code.

All Not
Satisfied

2.02 Both
Any fees due to the City of Calimesa for processing this project shall be paid to the City within thirty (30)
calendar days of final action by the approval authority.

Failure to pay such outstanding fees within the time
limits specified shall invalidate any approval granted.

No permits, site work, or other actions authorized by
this action shall be processed by the City, nor permitted, authorized or commenced until all outstanding
processing fees are paid to the City.

All Not
Satisfied

2.03 Relocation
Pursuant to CMC Section 18.70.120 Tree Preservation
Guidelines, the applicant shall obtain a tree removal
permit from the Community Development Department
prior to any ground disturbance.

Planning Not
Satisfied
3) Prior to Grading Permit

3.01 Relocation
Any additional import or export of soil that is not shown on the preliminary grading plan may require additional
environmental analysis at the discretion of the Planning Director.

Planning Not
Satisfied

3.02 Relocation
Project Design Feature: Due to the well relocation to
within 5’ of Calimesa Creek, the Project is required to implement Worker Environmental Awareness Program
(“WEAP”) training.

Planning Not
Satisfied

3.03 Both
Applicant shall comply with Assembly Bill 1414 (AB
1414) of the Business and Professions Code of the Land
Surveyors Act as required to preserve existing
monuments and survey control.

Engineering Not
Satisfied

3.04 Both
Applicant shall provide to the City copies of written
notifications given to off-site landowner(s) for required land disturbance activities on their respective
property(ies) prior to commencing grading, and prior to constructing for any offsite improvements, including
for potential tree removal on adjacent property.

Engineering Not
Satisfied

Exhibit A of City Council Resolution 2022-75
DPR 22-03

3.05 Relocation
Prior to issuance of a grading or drainage improvement
permit, all plans and reports associated with grading,
erosion, drainage, water quality & water treatment,
water retention/detention and best management
practices shall be approved by the City Engineer, as
applicable.

Engineering Not
Satisfied

3.06 Relocation
A temporary erosion control plan shall be submitted for plan check and approval by the City Engineer. Grading
and erosion control plans shall include provisions to
avoid adverse effects caused by rain, wind, or other
weather conditions. Erosion and sediment control plans
will be prepared and accomplished according to the best management practices as defined in the Riverside
County Drainage Area Master Plan and as required by
the National Pollutant Discharge Elimination System
(NPDES).

Engineering Not
Satisfied

3.07 Relocation
The grading plans shall include provisions to ensure
that grading will be conducted in accordance with the
South Coast Air Quality Management District's Rule
403.

Engineering Not
Satisfied

3.08 Relocation
The Applicant shall provide a comprehensive soils and
geotechnical report (no older than one year), based on
field and laboratory testing. The reports shall establish grading recommendations based on the nature and
character of the site soils. Project grading plans shall include specific requirements from the approved
geotechnical reports, including but not limited to, cuts, fills, over-excavation, and compaction requirements.

Geotechnical engineer shall sign and seal all grading
plans indicating the respective plan set complies with
the recommendations of the comprehensive soils and
geotechnical reports.

Engineering Not
Satisfied

3.09 Relocation
A comprehensive hydrology and hydraulics report shall
be submitted, reviewed, and approved by the City of
Calimesa. Any off-site drainage, which may impact
this development, or additional drainage created by this development, shall be addressed in accordance with the
mitigation measures required in the hydrology report
and as directed by the City Engineer. Approval of the
Hydrology/Hydraulics Report is required prior to
issuance of a grading permit.

Engineering Not
Satisfied

3.10 Relocation
Improvement plans shall demonstrate that historical or
existing storm water flows from adjacent properties are received and directed to a public street, a public
drainage facility, a City approved drainage easement or other approved facility.

Engineering Not
Satisfied

3.11 Relocation
The proposed project improvement plans shall be
designed such that drainage facilities will maintain or Engineering NotSatisfied

Exhibit A of City Council Resolution 2022-75
DPR 22-03

reduce the 100-year peak runoff rates presently exiting all Project boundaries. The Project drainage facilities shall reduce the storm water flows to or below the
existing condition flow rates prior to their discharge to areas located downstream of the project.

3.12 Relocation
All storm drains that are not maintained by Riverside
County Flood Control and Water Conservation District
(RCFCWCD) shall be designed and constructed to
RCFCWCD Standards, as applicable.

Engineering Not
Satisfied

3.13 Relocation
Dust control operations shall be performed by the
Contractor to comply with all Air Quality Management
District regulations regarding dust control and to the
satisfaction of the City Engineer. The City shall have
the authority to suspend all construction operations if, in their opinion, the Contractor fails to adequately
provide for dust control, and the Applicant shall in turn immediately notify the Contractor to suspend
construction operations within the area of concern, and require the Contractor to remedy the release of dust, to the satisfaction of the City.

Engineering Not
Satisfied

3.14 Relocation
Prior to issuance of a grading permit, construction
documents shall include language that requires all
construction contractors to strictly control the staging of construction equipment and the cleanliness of
construction equipment stored or driven beyond the
limits of the construction work area. When possible,
construction equipment shall be parked and staged
within the project site. Staging areas shall be screened from view from residential properties. Vehicles shall
be kept clean and free of mud and dust before leaving
the development site. Surrounding streets shall be
swept daily and maintained free of dirt and debris.

Engineering Not
Satisfied
4) Prior to Building Permit

4.01 Relocation
All building plans shall substantially conform to the
elevations approved at Planning Commission on
August 22, 2022.

Planning Not
Satisfied

4.02 Relocation
A detailed material and color board shall be submitted
in conjunction with construction plans. All exterior
treatments shall be keyed to and noted on the
construction plans and elevations.

Planning Not
Satisfied

4.03 Relocation
The Planning Department shall review and approve the
location and aesthetic design of any retaining and/or
block walls for substantial conformance with approved
plans.

Planning Not
Satisfied

Exhibit A of City Council Resolution 2022-75
DPR 22-03

4.04 Relocation
Off-street parking specifications shall be provided for standard, handicap, bicycle, motorcycle, carpool,
vanpool, and zero emission vehicles in accordance with
Calimesa Municipal Code Section 18.45.

Planning Not
Satisfied

4.05 Relocation
Any proposed trash enclosures shall be provided in
accordance with the City of Calimesa standard design
or alternate approved design and shall meet applicable
Cal Recycle sizing requirements. The enclosures shall
be treated to match the building and shall contain a fireresistant cover.

Planning N/A

4.06 Relocation
All exterior lighting shall comply with Calimesa
Municipal Code Section 18.120.090 "Lighting in the
commercial/industrial zone."
Planning Not
Satisfied

4.07 Relocation
The location of any utility vents or other equipment
shall be provided on the roof plan and the location of
any wall or ground-mounted equipment shall be shown
on the site plan and elevations; aboveground utility
boxes shall not interfere with line-of-sight visibility for parking lot circulation, as applicable, and in accordance with the Memorandum of Agreement for Improvements
Along County Line Road between the South Mesa
Water Company and Calimesa approved by City
Council on July 18, 2022.

Planning Not
Satisfied

4.08 Relocation
No exterior down spouts or roof scuppers shall be
permitted. All roof drains shall utilize interior piping but may have exterior outlets at the base of the
buildings.

Planning Not
Satisfied

4.09 Relocation
Details and specifications for all window and door
types and treatments shall be included in the
architectural plans.

Planning Not
Satisfied

4.10 Relocation
All wall and ground-mounted mechanical and electrical
fixtures and equipment shall be adequately and
decoratively screened. The screen shall be included as
an element of the overall design of the project and blend with the architectural design of the building. All
telephone and electrical boxes shall be identified on the construction plans.

Planning Not
Satisfied

4.11 Relocation
Prior to the issuance of building permits, the applicant shall comply with the provisions of the City of
Calimesa Development Impact Fee ordinance. The
amount of the fee for this development shall be
calculated at the issuance of each building permit. The development impact fee estimate for the minor
accessory building (160 square foot well pump house)
is $0.

Planning Satisfied

Exhibit A of City Council Resolution 2022-75
DPR 22-03

4.12 Relocation
Prior to the issuance of a building permit, the applicant shall comply with the provisions of City of Calimesa
Ordinance No. 212, which requires the payment of the
appropriate fee for the Western Riverside County
Multiple Species Habitat Conservation Plan. The
MSHCP fee obligation is estimated to be $0.

Planning Satisfied

4.13 Relocation
All sides of a building elevation shall have architectural treatment that is consistent with the architectural theme of the project to the satisfaction of the Community
Development Department.

Planning Not
Satisfied

4.14 Relocation
Three copies of construction landscaping plans shall be submitted to and approved by the Planning Department
and the City Landscape Architect. A licensed
Landscape Architect shall prepare the plans.

Landscaping Not
Satisfied

4.15 Relocation
The above-described plans shall be in substantial
conformance with the conceptual plans as approved by
the City Landscape Architect, City Administrative
Staff, Planning Commission, and City Council. Notes,
details, and specifications shall be included.

Landscaping Not
Satisfied

4.16 Relocation
All planting and irrigation plans shall be consistent with the Calimesa Municipal Code Title 18.75, Water
Conservation for Landscaping, Title 18.70, Landscape
Requirements.

Landscaping Not
Satisfied

4.17 Relocation
Landscape plans shall be drawn at a scale of 20 feet
equal to 1 foot or larger. The City will not accept plans drawn in 30 feet scale or smaller.

Landscaping Not
Satisfied

4.18 Relocation
No light fixture, electric transformer, fire detector
check or fire hydrant shall be designed for any location in a planting area, which would make it necessary to
eliminate a tree. All overhead light fixtures and utilities shown on the site, grading plan, shall be identified on the landscape plans. Utilities shall be screened
appropriately with landscaping.

Landscaping Not
Satisfied

4.19 Relocation
Plant materials shall be installed from container sizes consistent with Calimesa Municipal Code, Title 18.70 Landscaping NotSatisfied

4.20 Relocation
All shrubs and ground covers shall be installed from
living plant materials. On center spacing shall be
approved by the City Landscape Architect to achieve
appropriate plant coverage within 2 to 3 years of the
installation.

Landscaping Not
Satisfied

4.21 Relocation
All planting areas shall be a minimum of 5 feet wide
excluding curbs and walkways, walls, wall footings and
overhead obstructions.

Landscaping Not
Satisfied

Exhibit A of City Council Resolution 2022-75
DPR 22-03

4.22 Relocation
Planting areas along streets shall have approved street trees provided at the minimum rate of 30 feet on center.

All street trees shall be installed from 24-inch box
containers or greater. Trees shall not block site distance at driveways and should not block signage.

Landscaping Not
Satisfied

4.23 Relocation
Landscaping should be used to screen utility
equipment. Landscaping NotSatisfied

4.24 Relocation
All trees shall be double staked with vinyl type ties
nailed to the lodge pole stakes in at least two vertical locations.

Landscaping Not
Satisfied

4.25 Relocation
Root barriers shall be installed for all trees planted
within 8 feet of curbs, walks or walls. All trees located within the city right-of-way shall be planted with 20
lineal feet of approved root barrier.

Landscaping Not
Satisfied

4.26 Relocation
All irrigation in shrub areas shall be designed and
installed using drip irrigation. Landscaping NotSatisfied

4.27 Relocation
A weather-based smart irrigation controller shall be
installed that adjusts irrigation schedules per seasonal changes and measures evapo-transpiration. A rain shut
off device shall be installed free of overhead
obstruction and connected with the irrigation controller.

Landscaping Not
Satisfied

4.28 Relocation
All plants shall be hydro-zoned to low-medium water
use according to WUCOLS IV in Region 4, Inland
Valley as a general guide.

Landscaping Not
Satisfied

4.29 Relocation
All fertilizers and soil amendments used during
planting preparation and installation shall be derived
from organic based materials. Mycorrhizae and humate
shall be incorporated into each plant pit in accordance with the manufacturer’s specifications.

Landscaping Not
Satisfied

4.30 Relocation
A copy of the soil fertility recommendations and soil
management plan specified using organic fertilizers and soil amendments shall be included on the first submittal of the landscape construction documents.

Landscaping Not
Satisfied

4.31 Relocation
Prior to issuance of a building permit, the Applicant
shall be responsible for the payment of all outstanding fees as required by the City of Calimesa Municipal
Code, with the exception of the application fees waived by the City pursuant to the MOA in Section IV-1, and
all costs associated with the preparation of the MND
Addendum approved herein.

Engineering Not
Satisfied

4.32 Relocation
Prior to issuance of any building permits, Applicant
shall provide compaction test results for the building
pad as required by the Building Official.

Engineering Not
Satisfied

4.33 Relocation
Prior to issuance of a building permit, a Precise
Grading, Utility and Erosion Plan shall be submitted to the Public Works Department for review and approval.

Engineering Not
Satisfied

Exhibit A of City Council Resolution 2022-75
DPR 22-03

Plan check fees shall be paid based on the latest adopted fee schedule.

4.34 Relocation
Applicant shall be responsible to coordinate with
Southern California Edison regarding the relocation of
their existing transformer.

Engineering Not
Satisfied
5) Prior to Construction

5.01 Relocation
The City Landscape Architect shall meet with the job
site superintendent and the landscape contractor for a
pre-job meeting. Copies of required landscape
submittals shall be presented for approval. No
landscaping shall occur prior to the meeting.

Landscaping Not
Satisfied

5.02 Replacement
Per the State Water Resources Control Board,
construction activity resulting in a land disturbance of one acre or more, or less than one acre but part of a
larger common plan of development or sale must obtain
the Construction Activities Storm Water General
Permit (General Permit). Since this Project is a
requirement of the City of Calimesa's County Line
Transportation Corridor Project it shall be required to be covered under a Storm Water Pollution Prevention
Plan (SWPPP), either through the preparation of an
individual SWPPP or through an amendment to the
City's County Line Transportation Corridor Project
SWPPP, as required and to the satisfaction of the City
Engineer. Prior to issuance of grading permits, the
Applicant shall submit a copy of the Notice of Intent
(NOI), indicating that coverage has been obtained, to
the City Engineer and Building Official. The Applicant
shall include notes on the grading plans indicating that the project will be implemented in compliance with the
Statewide Permit for General Construction Activities.

Engineering Not
Satisfied

5.03 Replacement
A Storm Water Pollution Prevention Plan (SWPPP)
shall be approved and maintained throughout the scope
of the project, as applicable. Copies shall be available at the job site at all times.

Engineering Not
Satisfied

5.04 Both
This project is subject to all of the requirements of the Municipal Storm Water and Sanitary Sewer System
(MS4) permits issued by the Santa Ana Regional Water
Quality Control Board and all subsequent permits to
which the City is a signatory.

Engineering Not
Satisfied
6) Prior to Work in Public Right-of-Ways

6.01 Both
Prior to work in public right-of-ways, Applicant shall
notify the City, and provide full size (24”x36”) plans
and specifications as provided in the MOA, and
Engineering Not
Satisfied

Exhibit A of City Council Resolution 2022-75
DPR 22-03

evidence of insurance with the City being named as
additional insured.

6.02 Both
For work in the public right-of-ways, Traffic Control
Plan based on the California Manual of Uniform Traffic
Control Devices (CA MUTCD) shall be submitted, for
review and approval by the City Engineer. No
construction shall be allowed prior to the approval of
Traffic Control Plans.

Engineering Not
Satisfied

6.03 Relocation
Subject to the coordination provisions set forth in the MOA, Applicant shall dedicate additional right-of-way
for County Line Road, along the project frontage, to
provide the necessary right-of-way for construction of
the ultimate roundabout and street improvement
installations as applicable, and in accordance with the MOA. The final dedication alignment shall be reviewed
and approved by the City Engineer.

Engineering Not
Satisfied
7) Prior to Improvement Acceptance

7.01 Relocation
All approved Public improvement plans and revisions
shall be submitted to the City Engineer in both full sized mylars and electronic format. As-built drawings
necessary to document field construction changes shall
be provided to the City in electronic format and on
revised mylars prior to acceptance of improvements.

Engineering Not
Satisfied

7.02 Relocation
In accordance with the California Building Code, Title
24, and the requirements of the Americans with
Disabilities Act (ADA), facilities for disabled persons shall be constructed and existing facilities shall be
reconstructed at all street intersections or other
locations associated with the project as required by the City Engineer.

Engineering N/A

7.03 Relocation
All catch basins and storm drain inlet facilities shall be stenciled with the appropriate "No Dumping, Only Rain
in the Drain" message.

Engineering Not
Satisfied

7.04 Both
To the extent feasible, no utility boxes, pedestals, clean outs, manholes, vaults or other impediments shall be
installed within the public sidewalk area.

Engineering Not
Satisfied

7.05 Both
Prior to acceptance of improvements, Applicant shall
be required to replace any street improvements,
including but not limited to paving, sidewalk, curb and gutter, traffic signal loops and advanced warning loops, that are damaged during construction activities, to the satisfaction of the City Engineer.

Engineering Not
Satisfied

7.06 Both
Applicant shall be responsible for research on private
utility lines (gas, electric, telephone, cable, internet, etc.) to ensure there are no conflicts with site
development.

Engineering Not
Satisfied
8) Prior to Final Occupancy or Surety Release

Exhibit A of City Council Resolution 2022-75
DPR 22-03

8.01 Relocation
The applicant shall obtain a city-issued address for the structure prior to Final Occupancy. Planning NotSatisfied

8.02 Relocation
Any fees due to the City of Calimesa for postentitlement processing of this project shall be paid to the City prior to Final Occupancy, with the exception
of the inspection fees waived by the City in Section IV. 6 of the MOA.

Planning Not
Satisfied

8.03 Relocation
Prior to the issuance of an occupancy permit, the project proponent shall pay the Transportation Uniform
Mitigation Fee (TUMF) in accordance with the fee
schedule in effect at the time of issuance. The TUMF
obligation for this project is estimated to be $0.

Planning Satisfied

8.04 Relocation
Prior to final inspection, the Applicant shall provide the City with documentation of recovered organic waste
procurement.

Public
Works
Not
Satisfied

8.05 Relocation
All required landscaping and irrigation systems shall be installed in a condition acceptable to the City. The City will conduct inspections to ensure that the landscape
installation is in compliance with the approved
landscape plans.

Landscape Not
Satisfied

8.06 Relocation
A water audit from a certified water auditor shall be
presented in electronic format, along with the irrigation calculations to show water efficiency, irrigation
schedules, and the soil fertility report and
recommendations. The Applicant is a self-reporting
water purveyor and auditor.

Landscape Not
Satisfied

8.07 Relocation
Prior to Final Release, the Applicant shall be
responsible for the payment of all outstanding fees as
required by the City of Calimesa Municipal Code, with
the exception of the application fees waived by the City pursuant to the MOA in Section IV-1, and all costs
associated with the preparation of the MND Addendum
approved herein.

Engineering Not
Satisfied

8.08 Relocation
Prior to Final Release or acceptance of public
improvements, all new electrical power, gas, telephone, internet/fiber optics, television, and other
miscellaneous services shall be installed underground.

Engineering Not
Satisfied

8.09 Relocation
Prior to Final Release, all grading, public and private improvements, utilities, landscaping and irrigation and other items required by the conditions of approval shall be installed and accepted by the City. Certain public
improvements along the project frontage (ie curb,
gutter, sidewalk, storm drain, catch basin etc) may be
installed by the City as part of the County Line
Road/Calimesa Boulevard intersection project.

Additional coordination between the City and
Engineering Not
Satisfied

Exhibit A of City Council Resolution 2022-75
DPR 22-03

Applicant to occur, including possible in lieu fee
payment for the cost of the improvements.

8.10 Relocation
All approved public improvement plans and revisions
shall be submitted to the City Engineer in both full sized mylars and electronic format. As-built drawings
necessary to document field construction changes shall
be provided to the City in electronic format and on
revised mylars prior to Final Release or acceptance of
improvements.

Engineering Not
Satisfied

8.11 Relocation
Prior to Final Release, the project engineer shall
provide a fine grade certification letter for the building site to the City Engineer.

Engineering Not
Satisfied

8.12 Replacement
Upon the completion of construction, the Applicant, or
its designee, shall file a letter with the SWRCB or
submit information to the SMART System stating that
the construction activity is complete. A copy of this
letter shall be submitted to the City prior to Final
Release.

Engineering Not
Satisfied
9) Global Cap on City Fees

9.01 The total amount of any and all plan check, review and permitting fees payable in accordance with these
Conditions of Approval shall not exceed fifteen
thousand dollars ($15,000). This limitation does not
apply to in lieu fees, which shall be addressed on a case by case basis through negotiations with Applicant.

All Not
Satisfied
Acknowledgement and Agreement to Conditions of Approval As the Property Owner and Applicant(s) I (we) do hereby acknowledge that these Conditions of Approval have been read, fully understood and are hereby accepted. ______________________________ ______________________________ Applicant Signature Date
______________________________ ______________________________ Property Owner Date

Exhibit A of City Council Resolution 2022-75
DPR 22-03

Attachment B:

Previously Adopted Initial Study/Mitigated Negative Declaration for the County Line Road Transportation Corridor Project (SCH# 2019109030):
https://www.cityofcalimesa.net/172/Planning

Exhibit A of City Council Resolution 2022-75
DPR 22-03

Attachment C:

Addendum to the Initial Study/Mitigated Negative Declaration for the County Line Road Transportation Corridor Project (SCH# 2019109030)

Attachment 10B

City Council Meeting
Agenda Report
Agenda Item No. 11
SUBJECT: CITY COMMISSION APPOINTMENTS
MEETING DATE: December 19, 2022
PREPARED BY: Darlene Gerdes, Deputy City Manager/City Clerk RECOMMENDATION:

1. That Council Member Cervantez and Council Member Manly each appoint one member to the Library Commission and that the City Council ratify the appointments by a majority vote and adopt Resolution No. 2022-77 providing for appointments made.

2. That Council Member Cervantez and Council Member Manly each appoint one member to the Parks, Trails & Community Services Commission and that the City Council ratify the appointments by a majority vote and adopt Resolution No. 2022-78 providing for appointments made.

3. That Council Member Cervantez and Council Member Manly each appoint one member to the Planning Commission and that the City Council ratify the appointments by a majority vote and adopt Resolution No. 2022-79 providing for appointments made.

SUMMARY: Vacancies exist on the Library Commission, Parks, Trails & Community Services Commission, Planning Commission and Mobile Home Rent Stabilization Board. The notice of vacancies was posted and published, and a total of 6 applications were received.

The Library Commission has 2 vacancies, 2 applications were received. The Parks, Trails & Community Services Commission has 3 vacancies, 2 applications have been received. The Planning Commission has 2 vacancies, 2 applications were received. The Mobile Home Rent Stabilization Board has 7 vacancies, no applications have been received. Staff will continue to post the vacancies for consideration of appointments at a later date.

Certainly, appointments this evening can be deferred to a later date if Council is not ready to make an appointment. Staff will continue to post the vacancies and forward applications to Council upon receipt in the City Clerk’s Office.

LIBRARY COMMISSION
Two (2) vacancies exist and shall be made by Council Member Cervantez and Council Member Manly and appointee’s terms will coincide with the respective Council Member positions.

Applications for Library Commission were received by Robert Pettiford and Patricia Reeves.

PARKS, TRAILS & COMMUNITY SERVICES COMMISSION
Three (3) vacancies exist and two (2) appointments shall be made, one each by Council Member Cervantez and Council Member Manly and appointee’s terms will coincide with the respective Council Member positions. Mayor Pro Tem Hewitt will make an appointment to the third vacancy at a later date. Applications for Parks, Trails & Community Services Commission were received by Jerry Lerouge and Alicia Aponte.

PLANNING COMMISSION
Two (2) vacancies exist and shall be made by Council Member Cervantez and Council Member Manly and appointee’s terms will coincide with the respective Council Member positions.

Applications for Planning Commission were received by Mike Brittingham and John Keith.

MOBILE HOME RENT STABILIZATION BOARD
Appointments to the Mobile Home Rent Stabilization Board are made by the Mayor with the consent of Council. Seven (7) vacancies exist on the Mobile Home Rent Stabilization Board as follows:
5 Member Vacancies:
1 Mobile Home Park Owner Representative
1 Mobile Home Park Resident Representative
1 Citizen-At-Large - 1-year term
1 Citizen-At-Large – 2-year term
1 Citizen-At-Large – 3-year term
2 Alternate Member vacancies:
1 Mobile Home Park Owner Representative Alternate
1 Mobile Home Park Resident Representative Alternate
No Applications were received for the Mobile Home Rent Stabilization Board ATTACHMENTS:

Attachment A: Resolution No. 2022-77
Attachment B: Resolution No. 2022-78
Attachment C: Resolution No. 2022-79
Attachment D: Citizen Service Applications submitted

RESOLUTION NO. 2022-77

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

CALIMESA, CALIFORNIA, PROVIDING FOR APPOINTMENTS TO
THE LIBRARY COMMISSION.

WHEREAS Section 2.20.050 of the Calimesa Municipal Code requires that the City Council shall, by resolution, establish policies and procedures for appointing and removing Commissioners.

WHEREAS, Resolution No. 98-26, Section 2(a) requires that members of each Commission shall be appointed and shall serve for a period of time set forth in the ordinance creating the commission.

WHEREAS, Chapter 2.30.010 of the Calimesa Municipal Code requires that the Library Commission shall consist of five (5) members and be appointed as follows:

Each Council Member shall appoint one (1) Commissioner who shall serve at the pleasure of that appointing City Council Member for the term (or remainder thereof) of the City Council Member or to fill the unexpired term of a former incumbent, in which case, the appointment shall be for the unexpired term. Each Library Commissioner shall serve at the pleasure of the City Council. Appointments to the Library Commission shall be ratified by a majority vote of the City Council.

WHEREAS, Council Member Cervantez appoints ___________________ to the Library Commission, for a term to expire December 2026.

WHEREAS, Council Member Manly appoints ___________________ t to the Library Commission, for a term to expire December 2026.

NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF CALIMESA DOES HEREB Y RESOLVE AS FOLLOWS:

The City Council ratifies Council Member Cervantez appointment of ___________________ t to the Library Commission.

The City Council ratifies Council Member Manly’s appointment of ___________________ to the Library Commission.

PASSED, APPROVED AND ADOPTED this 19th day of December 2022. ________________________________

WILLIAM DAVIS, MAYOR
ATTEST:
_____________________________________

DARLENE GERDES, CITY CLERK

Attachment 11A
RESOLUTION NO. 2022-78

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

CALIMESA, CALIFORNIA, PROVIDING FOR AN APPOINTMENT TO
THE PARKS, TRAILS AND COMMUNITY SERVICES COMMISSION.

WHEREAS Section 2.20.050 of the Calimesa Municipal Code requires that the City Council shall, by resolution, establish policies and procedures for appointing and removing Commissioners.

WHEREAS, Resolution No. 98-26, Section 2(a) requires that members of each Commission shall be appointed and shall serve for a period of time set forth in the ordinance creating the commission.

WHEREAS, Chapter 2.25.010 of the Calimesa Municipal Code requires that the Parks, Trails and Community Services Commission shall consist of five (5) members and be appointed as follows: Each Council Member shall appoint one (1) Commissioner who shall serve at the pleasure of that appointing City Council Member for the term (or remainder thereof) of the City Council Member or to fill the unexpired term of a former incumbent, in which case, the appointment shall be for the unexpired term. Each Parks, Trails and Community Services Commissioner shall serve at the pleasure of the City Council. Appointments to the Parks, Trails and Community Services Commission shall be ratified by a majority vote of the City Council.

WHEREAS, Council Member Cervantez appoints ___________________ to the Parks, Trails and Community Services Commission, for a term to expire December 2026.

WHEREAS, Council Member Manly appoints ___________________ to the Parks, Trails and Community Services Commission, for a term to expire December 2026.

NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF CALIMESA DOES HEREB Y RESOLVE AS FOLLOWS:

The City Council ratifies Council Member Cervantez appointment of ___________________ to the Parks, Trails and Community Services Commission.

The City Council ratifies Council Member Manly’s appointment of ___________________ to the Parks, Trails and Community Services Commission.

PASSED, APPROVED AND ADOPTED this 19th day of December 2022. ________________________________

WILLIAM DAVIS, MAYOR
ATTEST:
_____________________________________

DARLENE GERDES, CITY CLERK

Attachment 11B
RESOLUTION NO. 2022-79

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

CALIMESA, CALIFORNIA, PROVIDING FOR APPOINTMENTS TO
THE PLANNING COMMISSION.

WHEREAS Section 2.20.050 of the Calimesa Municipal Code requires that the City Council shall, by resolution, establish policies and procedures for appointing and removing Commissioners.

WHEREAS, Resolution No. 98-26, Section 2(a) requires that members of each Commission shall be appointed and shall serve for a period of time set forth in the ordinance creating the commission.

WHEREAS, Chapter 2.45.020 of the Calimesa Municipal Code requires that the Planning Commission shall consist of five (5) members and be appointed as follows: Each Council Member shall appoint one (1) Commissioner who shall serve at the pleasure of that appointing City Council Member for the term (or remainder thereof) of the City Council Member or to fill the unexpired term of a former incumbent, in which case, the appointment shall be for the unexpired term. Each Planning Commissioner shall serve at the pleasure of the City Council. Appointments to the Planning Commission shall be ratified by a majority vote of the City Council.

WHEREAS, Council Member Cervantez appoints ___________________ to the Planning Commission, for a term to expire December 2026.

WHEREAS, Council Member Manly appoints ___________________ to the Planning Commission, for a term to expire December 2026.

NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF CALIMESA DOES HEREB Y RESOLVE AS FOLLOWS:

The City Council ratifies Council Member Cervantez appointment of ___________________ to the Planning Commission.

The City Council ratifies Council Member Manly’s appointment of ___________________ to the Planning Commission.

PASSED, APPROVED AND ADOPTED this 19th day of December 2022. ________________________________

WILLIAM DAVIS, MAYOR
ATTEST:
_____________________________________

DARLENE GERDES, CITY CLERK

Attachment 11C