Carlsbad City Council
April 16, 2024

CA Review AZ
Meeting Date: April 16, 2024
To: Mayor and City Council
From: Scott Chadwick, City Manager
Staff Contact: Roxanne Muhlmeister, Assistant Finance Director [email protected], 442-339-2417
Subject: City of Carlsbad Fiscal Year 2022-23 Annual Financial Audit Results District: All
Recommended Action
Receive and file a report on the city’s fiscal year 2022-23 a nnual financial audit results.

Ex
ecutive Summary
The City of Carlsbad is required by the State of California to be audited by a certified public accountant or public accountant, licensed by, and in good standing with, the Cal ifornia Board of Accountancy. The city’s annual financial audit for fiscal year 2022-23 resulted in an unmodified opinion, and there were no material weaknesses in internal controls, nor were any material instances of noncompliance identified.

Explanation & Analysis
The Finance Department is responsible for the stewardship of the city’s assets and liabilities, helping to ensure information is provided in an effective and timely manner so that the best financial decisions can be made. An important component of this stewardship is the completion of the city’s annual financial audit by a certified public ac countant firm.

Results of the Fiscal Year 2022-23 Financial Audit
In February 2022, city staff selected and issued a five-year contract to th e C PA firm Lance, Soll & Lunghard, LLP to perform the city’s annual financial audit. The role of the external auditor is to express an opinion on whether the city’s financial statements are materially misstated. The external au ditors follo w Government Auditing Standards tha t have been created by the American Institute of Certified Public Accountants.

Th
e fiscal year 2022-23 audit began in May 2023 with the external auditors co nducting interim fieldwork, and the audit concluded on March 26, 2024, when the auditors issued their opinion on the city’s financial statements. The city received an “unmodified” opinion, which means that it is the au ditor’s j udgment that the city’s financial sta tements and footnotes are fairly stated, without any material exceptions, and in compliance with the generally accepted accounting principles known as GAAP.

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The auditor did not identify any material weaknesses in internal controls nor any material instances of noncompliance.

The Independent Auditor’s Report is part of the city’s Annual Comprehensive Financial Report (Attached as exhibit 1 to this report) This annual report also includes further discussion and analysis of the city’s finances and basic financial statements.

Transparency
The city publishes quarterly financial status reports on the city’s website, which highlight the city’s General Fund, Water Fund, Wastewater Fund and Golf Course Fund revenues and expenditures for the fiscal year. City staff also provide the public and City Council with quarterly economic and financial reports and presentations at City Council meetings throughout the fiscal year. A brief description of these updates is provided below.

Quarterly financial status reports
Quarterly financial reports provide the unaudited detail of city’s General Fund, Water Fund, Wastewater Fund and Golf Course Fund revenues and expenditures for the fiscal year. These quarterly reports can be found on the city’s website at www.carlsbadca.gov/departments/finance/financial-reports.

Quarterly Economic and Financial Update Presentations to City Council:
• First Quarter of Fiscal Year 2022-23, presented Nov. 15, 2022, covered the period of July through Sept. 2022.

• Second Quarter of Fiscal Year 2022-23, presented Feb. 14, 2023, covered the period of Oct. through Dec. 2022.

• Third Quarter of Fiscal Year 2022-23, presented May 16, 2023, covered the period of Jan. through March 2023.

• First Quarter of Fiscal Year 2023-24, presented Nov. 14, 2023, covered the period of July through Sept. 2023.

• Second Quarter of Fiscal Year 2023-24, presented Feb. 27, 2024, covered the period of Oct. through Dec. 2023.

Approval of Fiscal Year 2022-23 Budget Carryforward Requests and Appropriation of Funds to Fiscal Year 2023-24

In addition to requesting carryforward funding for fiscal year 2023-24, this Sept. 26, 2023, report provided an unaudited synopsis of the financial results of fiscal year 2022-23 for the city’s General Fund.

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City of
Carlsbad
C, 1 1 fo In 1,

Fiscal Analysis
This is an informational item with no fiscal impact.

Next Steps
The city’s next financial audit, for fiscal year 2023-24, is scheduled to commence with Lance, Soll & Lunghard, LLP in April 2024. The audit is expected to conclude in late 2024 or early 2025.

Environmental Evaluation
This action does not require environmental review because it does not constitute a project within the meaning of the California Environmental Quality Act under California Public Resources Code Section 21065 in that it has no potential to cause either a direct physical change or a reasonably foreseeable indirect physical change in the environment.

Exhibits

1. City of Carlsbad Fiscal Year 2022-23 Annual Comprehensive Financial Report

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Annual Comprehensive
Financial Report
Fiscal Year ended June 30, 2023
Exhibit 1
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{city of
Carlsbad
California

Annual Comprehensive
Financial Report

Fiscal Year Ended
June 30, 2023

Prepared by the

Finance Department
1635 Faraday Ave.

Carlsbad, CA 92008
www.carlsbadca.gov
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{city of
Carlsbad

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Annual Comprehensive Financial Report
For the Fiscal Year Ended June 30, 2023

Table of Contents

Introductory Section Page

Letter of Transmittal i
Certificate of Achievement for Excellence in Financial Reporting xxi Location Map xxii
List of City Officials xxiii
Organization Chart xxiv

Financial Section

Independent Auditor’s Report 1

Management’s Discussion and Analysis 5

Basic Financial Statements
Government-Wide Financial Statements
Statement of Net Position 25
Statement of Activities 26
Fund Financial Statements
Balance Sheet – Governmental Funds 29
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position 31 Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds 32 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities 35 Statement of Net Position – Proprietary Funds 36
Statement of Revenues, Expenses and Changes in Fund Net Position – Proprietary Funds 40 Statement of Cash Flows – Proprietary Funds 42
Statement of Fiduciary Net Position – Fiduciary Funds 46 Statement of Changes in Fiduciary Net Position – Fiduciary Funds 47 Notes to the Financial Statements 49

Required Supplementary Information
Budgetary Comparison Schedule
General Fund 97
Required Pension and Other Postemployment Benefits Schedules Schedule of Changes in the Net Pension Liability and Related Ratios -Miscellaneous Plan 98 Schedule of Changes in the Net Pension Liability and Related Ratios-Safety Plan 100 Schedule of Changes in the Net OPEB Liability and Related Ratios 102 Schedule of Plan Contributions 104
Notes to Required Supplementary Information 105

Combining and Individual Fund Statements and Schedules
Combining Balance Sheet –Nonmajor Governmental Funds 107 Combining Statement of Revenues, Expenditures and Changes in Fund Balances – Nonmajor Governmental Funds 113
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{city of
Carlsbad

Annual Comprehensive Financial Report
For the Fiscal Year Ended June 30, 2023

Table of Contents

Financial Section (continued) Page

Budgetary Comparison Schedules
Affordable Housing 119
Community Development Block Grant 120
Donations 121
Financing Districts 122
Habitat and Agricultural Management 123
Other Special Revenue Funds 124
Police Grants and Asset Forfeiture 125
Section 8 Rental Assistance 126
Tyler Court Apartments 127
California Opioid Settlement 128
Assessment and Other Districts 129
Bridge & Thoroughfare Districts 130
Community Facilities District #1 131
Gas Tax 132
General Capital Construction 133
Grants and Other Capital Projects 134
Infrastructure Replacement 135
Park Development 136
Planned Local Drainage Facilities 137
Public Facilities Construction 138
Sales Tax/TransNet 139
Traffic Improvement Projects 140
Technology Investment Capital 141
Combining Statement of Net Position – Nonmajor Proprietary Funds 142 Combining Statement of Revenues, Expenses and Changes in Fund Net Position – Nonmajor Proprietary Funds 143
Combining Statement of Cash Flows – Nonmajor Proprietary Funds 144 Combining Statement of Net Position – Internal Service Funds 146 Combining Statement of Revenues, Expenses and Changes in Fund Net Position – Internal Service Funds 148
Combining Statement of Cash Flows – Internal Service Funds 150 Combining Statement of Fiduciary Net Position – Custodial Funds 154 Combining Statement of Changes in Fiduciary Net Position – Custodial Funds 155

Statistical Section

Financial Trends
Net Position by Component 158
Changes in Net Position 160
Fund Balances of Governmental Funds 164
Changes in Fund Balances of Governmental Funds 166

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{city of
Carlsbad

Annual Comprehensive Financial Report
For the Fiscal Year Ended June 30, 2023

Table of Contents

Statistical Section (continued) Page

Revenue Capacity
General Governmental Tax Revenues by Source 168
Water and Wastewater Rates 169
Assessed Value of Taxable Property 171
Direct and Overlapping Property Tax Rates 172
Principal Property Taxpayers 174
Property Tax Levies and Collections 175
Debt Capacity
Ratios of Outstanding Debt by Type 177
Schedule of Direct and Overlapping Bonded Debt 178
Direct and Overlapping Debt 180
Legal Debt Margin Information 182
Pledged-Revenue Coverage 184
Demographic and Economic Information
Demographic and Economic Statistics 186
Principal Employers 189
Operating Information
Authorized Full Time City Government Employees by Program Area 190 Operating Indicators by Function/Program 192
Capital Asset Statistics 194
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Introductory Section

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Administrative Services
Finance Department 1635 Faraday Avenue  Carlsbad, CA 92008  442-339-2430 t www.carlsbadca.gov

March 26, 2024
Honorable Mayor, City Council,
and Residen
ts of the City of Carlsbad
City of Carlsbad
Carlsbad, CA 92008

LETTER OF TRANSMITTAL
FISCAL
YEAR 2022-23 ANNUAL COMPREHENSIVE FINANCIAL REPORT
Honorable Mayor, City Council, and Residents:

I am pleased to present the fisc al year 2022-23 Annual Comprehensive Financial Report for the City of Carlsbad (“city”). The information found in this report is provided by management to the City Council and the public to assist those interested in understanding the fiscal condition of the city as of June 30, 2023.

Management assumes full responsi bility for the completeness and reliability of the information contained in this report, based upon a comprehensive framework of internal contro ls that has been established for this purpose.

B e c a u s e t h e c o s t o f i n t e r n a l c o n t r o l s s h o u l d n o t o u t w e i g h i t s benefits, the city’s comprehensive framework of internal controls has been designed to provide reasonable, rath er than absolute, assurance that the financial statements will be free from material misstatement.

State law and the Carlsbad Municipal Code require that an annua l financial report is prepared. This report fulfills that obligation. It has been prepared in conformity with genera lly accepted accounting principles (GAAP) and with the financial reporting requirements prescribed by the Governme ntal Accounting Standards Board (GASB). The independent auditing firm, Lance, Soll & Lunghard, LLP, has iss ued an unmodified opinion on the city’s financial statements for the fiscal year that ended June 30, 2023. The in dependent auditor’s report is located at the front of the financial section of this Annual Comprehensive Financial Report.

Management’s Discussion and Analysis (MD&A) immediately follows the i ndependent auditor’s report and provides a narrative introduction, overview and analysis of the basic financial statements. The MD&A complements this letter of transmittal and should be read in conjunction with it.

As a recipient of federal and state financial assistance, the city is r equired to have a “Single Audit” performed by an independent audit firm. The Single Audit is designed to meet th e special needs of federal grantor agencies. The standards governing Single Audit engagements require that the i ndependent auditor report not only on the fair presentation of the financial statements, but also on the audit ed government’s internal controls and compliance with legal requirements, with special emphasis on internal controls and legal requirements involving the administration of federal awards. These reports will be completed in March 2024 and made publicly available on the city’s website in the city’s separately issued Compliance Reports and Other Financial Information. i
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C cityof
Carlsbad

Profile of the City of Carlsbad

The City of Carlsbad is situated in north San Diego
County where a great climate, beautiful beaches
and lagoons, and abundant natural open space
combine with world c lass resorts, family
attractions, well-planned neighborhoods, a diverse
business sector and a charming village atmosphere
to create the ideal California experience.

CITY GOVERNMENT

Incorporated in 1952, the City of Carlsbad is a municipal corpo r a t i o n f o l l o w i n g t h e c o u n c i l - m a n a g e r f o r m o f government. The City Council, the city’s legislative body, defines the policy direction of the city. The city manager oversees the day-to-day operations of the city. The City of Carlsbad also has an elected City Clerk and City Treasurer. The City Council appoints the City Manager and City Attorney.

Districts
The City Council consists of an elected mayor and four elected council members. Each serves a four-year term. In 2017, the city switched to a system where City Council members are elected by district instead of at large or citywide. ii
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,ad is situated in north San Diego
great climate, beautiful beaches
:I abundant natura l open space
world c lass resorts, fami ly
,lanned neighborhoods, a diverse
1d a charming village atmosphere
ii California experience.

I
Population
115,000
6,S00
Acres of open space
j{3 l agoons
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Size
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39 ,
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sq. miles
Incorporat ed
Nearly
7 Mile s of
coastline

Charter City
There are two types of cities in California: charter and general law. Charter cities follow the laws set forth in the state’s constitution along with their own adopted “charter” doc ument. General law cities follow the laws set forth by the state legislature.

In 2008, City of Carlsbad residents overwhelmingly voted to approve the charter city measure. The charter gives the City of Carlsbad more flexibilit y on such issues as purchasing a nd co ntr acting. Cert ain affairs, such a s traffic and vehicle regulation, open and public meetings laws, certain planning and environmental laws, and eminent domain, remain matters of state authority even as a charter city.

This report includes financial statements for the City of Carlsbad, the Housing Authority of the City of Carlsbad, the Carlsbad Public Financing Authori ty, and the Carlsbad Municipal Water District. Through these entities, Carlsbad provides a full range of services to its citizens and customers including:

• Fire and paramedic services
• Police protection services
• Development services
• Library and arts programs
• Housing and homeless services
• Recreation programming for all ages
• Park and recreation areas
• Street construction and maintenance
• Water delivery system
• Wastewater system

In addition to the full range of services normally associated w ith a municipality, Carlsbad offers programs to help residents and businesses. The city’s Housing Authority administ ers federal housing assistance to 575 low-income households in Carlsbad, and older residents can take advantage of Carlsbad’s senior citizen programs.

Budget Process

The City Council sets the overall policy direction for the City of Carlsbad and helps staff prioritize programs, projects and services to support that direction. Public input plays a critical role in setting both the long-range policy direction of the city and decisions about day-to-day spending. The city operates on a fiscal year that begins July 1. City staff in all departments prepare individual budgets for their functional areas. These budgets are then combined into an overall city budget that is presented to the City Council each spring for review and input. iii
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FISCAL YEAR 2022-23

BUDGET SCHEDULE
December 2021
City Council begins development of a five-year strategic pla n January 2022
Public input gathered on Strategic plan goal themes
February 2022
City departmen ts submit initial budgets and proposed changes for review
March 2022
City Council workshop to consider input and finalize strategic plan goal themes
April - May 2022
Department budget s are refined and finalized. List of Capital Improvement Program projects prioritized
May - June 2022
Preliminary budget presented to the City Council and public June 2022
Final City Council budget adopted
July 1, 2022
First day of the new fiscal year
C cityof
Carlsbad

The City Council has the authority to approve the annual budget and may amend it during the year if needed. The legal level of budgetary control is at the fund level, which me ans spending in each different type of fund may not exceed the budgeted amount without City Council approval. Budgetary control for the city is maintained through its accounting systems. Quarterly reports summarizing the results of operations for the city’s more significant funds are provided to the City Council and the public on the city’s website.

The City Council’s 5-Year Strategic Plan

The adoption of the City Council’ s 5-Year Strategic Plan in 202 2 allows staff to focus on five main areas, with the annual budget outlining how th e city will work to accomplish th e strategic plan’s objectives and work toward the plan’s vision in the year ahead.

Community Character
Maintain Carlsbad’s unique community character and connectedness

In five years, even though the city has grown and changed, resi dents agree that it still has the smalltown beach community character and connectedness that made them want to li ve here in the first place. Diverse community members of all ages enjoy participating in the wide array of programs and events offered by the city, where they run into neighbors, meet new friends and, mostly importantly, feel welcome and included.

Quality of Life and Safety
Prioritize the safety and well-being of the community

In five years, the City of Carlsbad remains one of the safest c ities in the region due to ne w investments in fire and emergency medical services and a well-equipped and highly trained Police Department that enjoys excellent relationships with the community . Critical infrastructure like roads and pipes are well-maintained, while parks, community centers, libraries and other facilities reflect the community’s high standards.

Sustainability and the Natural Environment
Protect the environment and natural resources

In five years, thanks to the city’s strategic approach to environmental sustainability, Carlsbad is seen as a model for how to leverage partnerships and innovation to achieve climate and environmental goals. City residents and businesses feel supported in their own environmental sustainabi l i t y e f f o r t s , w h e t h e r i t ’s complying with new mandates or taking advantage of opportunities to go above and beyond. As a result, the city has met or exceeded goals for eliminating greenhouse gas emissions, reducing what g oes to landfills, keeping creeks, lagoons and the ocean clean, and protecting native habitat and natural open space.

Economic Vitality
Foster a healthy local economy

In five years, the City of Carlsbad has a strong and diverse economy that combines a thriving small business community with leading industries of the future. Smart, talente d p r o f e s s i o n a l s w a n t t o w o r k h e r e , a n d entrepreneurial leaders want to invest in their own startup ventures. Those looking to grow their skills will find opportunities for workforce development in Carlsbad. Carlsbad h as excellent relationships with key industries, business organizations, other cities in the region, and academic institutions. By achieving this goal, the city as a whole is financially stable and more residents have the jobs they want right in their own backyards. iv
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0 0

Organizational Excellence and Fiscal Health
Be a model for effective and efficient local government

In five years, the City Council, the community and city employe es have remained aligned around common goals established in the 5-Year Strategic Plan. This sustained focus has not only generated measurable results, but it has also translated into operational efficiencies and cost savings. The very best in their fields want to work for the City of Carlsbad because of the culture that has been created around innovation, inclusivity and engagement. The city’s financial health has been maintained while meeting or even exceeding the community’s high expectations for service delivery. Investments in technology have led to enhanced efficiency, transparency, accountability and value.

Economic and Fiscal Issues Facing the City

At the time of developing the Fiscal Year 2023-24 Preliminary Budget, the nation, state and city has largely recovered from fiscal impacts of the COVID-19 pandemic. However, unprecedented inflationary levels were challenging the economy. In the City of Carlsbad, high inflationary levels have actually boosted some of the city’s revenue sources like sales and transient occupancy tax, but the city’s expendit u r e s h a v e a l s o i n c r e a s e d t r e m e n d o u s l y . W h i l e t h e Federal Reserve has taken swift action to combat the rise in inflation by increasing interest rate targets, we have yet to see inflation levels return to more historically normal leve l s . A s t h e c i t y m o v e s f o r w a r d , a n d a s t h e l e v e l o f disposable income, personal savings and pent-up demand continue s t o d i m i n i s h a s a r e s u l t o f t h e s e s u s t a i n e d inflationary levels, uncertainty about the city’s revenues keeping pace with its expenditures increases.

Prior to the pandemic, the city boasted a low unemployment rate o f 2 . 9 % . A t t h e h e i g h t o f t h e p a n d e m i c , unemployment spiked to 13.8%. Over the past two years, the unem ployment rate has had some correlation to the prevalence of COVID-19 in the region. However, with the pandemi c’s economic impacts behind us, unemployment rates settled between 2% and 3% during calendar year 2022. Through the first quarter of calendar year 2023, macro- trends in the tech industry pushed unemployment up nationally, but the labor market is still considered to be very tight. As of March 2023, the unemployment rate was 4.8% at the state level, 3.7% at the c ounty level and 3.5% at the local level.

National interest rates, which dropped significantly during the pandemic, have now eclipsed pre-pandemic rates for all categories. One-year rates are currently at 1.63%, ten-year rates are currently at 2.32%, and 30-year rates are at

2.44%. With lingering concerns surrounding inflation, the Federal Reserve has begun to raise interest rates and has done so over the Federal Open Market Committee’s last eight meetings resulting in current interest rate targets of 5%-5.25%. As of May 2023, local inflation had decreased year-over-year from 8.3% to 5.2%.

Maintaining good fiscal health must remain a top priority. Meet ing this objective preserves the city’s ability to continue providing important programs and services to the commu nity. Past economic challenges and prudent financial planning have provided opportunities for developing s olutions to address lost revenues while preserving v i t a l s e r v i c e s . T h e p o s i t i v e e f f e c t o f i n f l a t i o n o n s o m e o f t h e city’s revenue sources have been significant but is considered one-time and something to be very closely monitored moving forward. As inflation is likely to decline in the future, so will revenue growth. Disciplined spending and long-term financial planning remain critical to ensuring the future sustainability of important city programs and services. v
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e

Long-Term Financial Planning

Strategic planning begins with determining the city's fiscal capacity based upon long-term financial forecasts of recurring available revenues and future financial obligations. Prior to the adoption of the annual budget, the finance department will prepare a Ten-Year Financial Forecast (“Forecast”) that evaluates known internal and external issues impacting the city's financial c ondition. The methodology for p reparing the Forecast can be found in the appendix of this document. The Forecast is intended to help the city:

• Attain and maintain financial sustainability;
• Have sufficient long-term information to guide financial decisions; • Have sufficient resources to provide programs and services for the stakeholders; • Identify potential risks to on-going operations in the long-term financial planning process and communicate these risks on an annual basis;
• Establish mechanisms to identify early warning indicators; and • Identify changes in expenditure or revenue structures needed to d e l i v e r s e r v i c e s o r t o m e e t t h e g o a l s adopted by the City Council.

It is important to stress that the Forecast is not a budget. Th e Forecast does not dictate expenditure decisions, but rather highlights the need to pr ioritize the allocation of the city’s limited resources to ensure the continuation of core city services. The purpose of the plan is to provide the City Council, key stakeholders, and the public an overview of the city’s fiscal health based on various financial and serv ice level assumptions over the next ten years. It also allows for the discussion of necessary steps to be initiated du ring the development and implementation of future budgets. The Forecast is intended to look beyond the annual bud get cycle and serve as a planning tool to bring a long-term perspective to the budget process. The Forecast also takes into consideration Council Policies that need to be met on an annual basis including General Fund reserve gui delines, pension funding guidelines, etc. Should projected expenditures exceed projected revenues in any given year, the City Manager will need to identify steps to mitigate the shortfalls prior to presenting a balanced budget to the City Council for consideration during the annual budget development process.

It should be noted that the Forecast is a snapshot in time and will change as additional information is made available and incorporated into the fiscal projections. COVID-19 and the economic uncertainty associated with the pandemic period has increased the volatility of projecting future revenues.

The city prepares a long-term financial model for both capital and operating needs. It is imperative that the city plan for the impacts of development, the construction and operation of new public facilities, and planning resources needed to build them. The city prepares a ten-year operating fo recast for the General Fund, a five-year Strategic Digital Transformation Investment Program, and a fifteen-year Capital Improvement Program. As part of the new Strategic Digital Transformation Investment Program and the Cap ital Improvement Program, the city annually calculates the amounts needed to pay for the projects and calcu lates the anticipated operating budget impacts. In this way, the city can anticipate the effects of development from both a capital and an operating perspective.

One important initiative the city has undertaken to ensure its financial health is the development of an Infrastructure Replacement Fund.

With this fund, the city sets aside a portion of General Fund revenues on an annual basis for major maintenance and replacement of its infrastructure. Much o f the city’s infrastructure is relatively new; thus, the city is just now experiencin g the impact of maintenance req uirements. By setting aside funds now, the city’s residents can be assured that the proper maintenance and replac ement will be performed, as needed, on streets, parks and many facilities for which the city is responsible. vi
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Employee retirement costs continue to require ongoing prudent f iscal management. The City Council issued a pension funding policy to codify its commitment to ensure that resources will be available to fulfill the city’s contractual retirement promises to its employees, and to minimize the chance that the funding of these benefits will interfere with providing essential services to the community. The policy outlines a funding discipline to ensure that adequate resources will be accum ulated in a systematic and disc i p l i n e d m a n n e r t o f u n d t h e l o n g - t e r m c o s t o f benefits to the plan participants and annuitants. Overall funding levels of the city’s plans are reviewed annually to ensure the city’s funding level remains at least 80% – the city ’s minimum targeted level. While this enhances the city’s funding position, risks remain in the system. Required employer contributions will continue to increase over the next few years and actual contribution increases could exceed expectations if future investment return rates or other factors are unfavorable.

Revenue and expenditure growth projections
The city’s Forecast considers the annual growth of all currently known elements of city revenues and expenditures.

Projecting revenues is particularly difficult when considering the short-term impacts of COVID-19 on the economy, leaving the timing of an economic rebound and future growth vol atility uncertain. When forecasting expenditures, some of the major factors considered are rising healthcare and workers’ compensation costs, underperforming pension programs, and general inflation in both personnel and o perating expenditures. Currently, the city projects expenditure growth will outpace revenue growth in the near future. To support the increase in ongoing costs, the city will need to consider alternative options, such as ways to increase economic activity that will drive sustainable increases in the city’s current r evenue base, an expansion of t he city’s revenue base, or a reduction of the city’s current service offerings and associated costs.

FINANCIAL MANAGEMENT POLICIES

Revenue Policies
The development and maintenance of balanced and reliable revenue streams will be the primary revenue objective of the city. Efforts will be dir ected to optimize existing reve nue sources while periodically reviewing potential new revenue sources. One method to maximize existing revenue source s it to promote a healthy business climate.

Revenue estimates will be prepared on an annual basis during th e preparation of the budget and major revenue categories will be projected on a ten-year basis. Revenues will be estimated conservatively using accepted standards and estimates provided by the state and other governmental agen c i e s . A l t e r n a t i v e r e v e n u e s o u r c e s w i l l b e periodically evaluated to determ ine their applicability to meet identified city needs. Sources of revenue will be evaluated and modified as necessary to assure a diversified and growing revenue base that improves the city’s ability to handle fluctuations in individual revenue sources.

Revenues from “one-time” or limited duration revenue sources will not be used for ongoing operating expenses.

Fees and charges for services will be evaluated and, if necessa ry, adjusted annually to ensure that they generate sufficient revenues to meet service delivery costs. The city will establish user charges at a level generally related to the full cost (operating, direct, indirect and capital costs) of providing the service, unless the City Council determines that a subsidy from the General Fund is in the public interest. The city will also consider market rates and charges levied by other municipalities of similar size for like service s in establishing rates, fees and charges. Enterprise and internal service funds will be self-supporting.

Expenditure and Budget Policies
Major expenditure categories will be projected on a ten-year basis. The city will operate on a current funding basis.

Expenditures will be budgeted and controlled so as not to excee d current revenues plus the planned use of any accumulated fund balances. Annual budgeted operating expenditures shall not exceed annual operating revenues, including budgeted use of reserves, unless directed by the City Council. vii
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The City Manager shall prepare and submit to the City Council a nnually a proposed operating, strategic digital transformation investment program and capital improvement program budget each year, and the budgets will be adopted by June 30 of each year. Budget status reports are prep ared monthly, distributed to all departments and posted on the city’s website. Because the budget is based on es timates, from time to time, it is necessary to make adjustments to finetune the line-items within it. Various levels of administrative control are utilized to maintain the budget’s integrity. Program managers are accountable for the line-item level of control of their individual program budgets. Department heads are accountable for the fund level of control for funds within their departments. The Finance Department oversees the general level of accountability related to budgetary integrity through systematic checks and balances and various internal controls.

Council Policy No. 87 – General Fund Surplus Policy outlines the use of surplus fund s resulting from unrestricted General Fund actual revenues exceeding total actual expenditure s, encumbrances, and commitments for a given fiscal year. It is the intent of the city to use all surplus fu nds generated to meet reserve policies, and the reduction or avoidance of long-term liabilities. The city will not use year-end surplus funds to fund ongoing operations unless otherwise approved by the City Council.

The city will use surplus funds t o replenish any General Fund d eficiencies, up to the minimum level as set forth in Council Policy No. 74 – General Fund Reserve Policy and then any pension liability deficiencies, as defined in City Council Policy No. 86 – Pension Funding Policy.

The City Manager is authorized to approve the carryforward of any unencumbered and unspent and unencumbered budget for a particular item equal to or less than $100,000 int o the following fiscal year. These items will be one- time expenditures and not for ongoing services, programs or per sonnel. Any remaining surplus funds in excess of reserve and pension liability deficiencies and items equal to o r greater than $100,000 will be brought forward for City Council approval.

The city adheres to long-range financial planning which forecas ts revenues and expenditures over a long-term period, using assumptions about economic conditions, future spending scenarios, and other salient variables.

Financial planning allows the cit y to execute overall strategies to support the process of aligning financial capacity with long-term service objectives. Financial forecasts are updated at least once a year, or more often, if unexpected changes in economic conditions or other unforeseen circumstance s exist. Any significant c hanges will be reported t o t h e C i t y M a n a g e r a n d t h e C i t y Council. Otherwise, these fina ncial forecasts will be used as a tool during the development of the annual budget process and to set utility rates as needed.

Reserve Policies
The city formally mandates the levels at which reserves shall be maintained for the General Fund and informally sets minimum target levels for the enterprise and internal service funds.

Council Policy No. 74 – General Fund Reserve Policy was most recently updated and approved by the City Council in June 2019. The purpose of the policy is to establish a target minimum level of designated reserves in the General Fund to:

• Reduce the risk of financial impacts resulting from a natural disaster or other catastrophic events; • Respond to the challenges of a changing economic environment, i ncluding prolonged downturns in the local, state or national economy; and
• Demonstrate continued prudent fiscal management and creditworthiness. viii
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The city commits to maintaining General Fund reserves (the term reserve refers to any unassigned fund balance) at a target of 40% of General Fund annual operating expenditures. The total reserve level will be calculated using the prior year’s adopted General Fund budgeted expenditures.

At the discretion of the City Cou ncil, reserve levels in excess of the 40% target requirement may be used for one- time opportunity cost purposes. Reserve funds will not be spent for any function other than the specific direction in the annual budget or by a separate City Council action.

As a general budget principle concerning the use of reserves, the City Council decides whether to appropriate funds from reserves. Reserve funds will not be spent for any function other than the specific purpose of the reserve account from which they are drawn without specific direction in the annual budget or by a separate City Council action.

Council Policy No. 96 – Utilities Reserve Policy is designed to establish guidelines to ensure the fiscal stability of the potable water, recycled water and wastewater funds. The annual budget process and the setting of utility user rates and charges will be used to achieve and maintain the various ta r ge t r e s e r v e l e v e l s . T he p o l i cy a i m s t o m a i n t a i n minimum and target reserves for the following areas:

• Operating Reserve-minimum of 90 days and target of 120 days of operating costs for the operating funds of potable water, recycled water and wastewater funds
• Debt Service Reserve-100% of required annual debt service for potable water, recycled water and wastewater
• Capital Construction Reserve-minimum 50% and target of 100% for p o t a b l e a n d r e c y c l e d w a t e r a n d a minimum 25% and a target of 50% o f wastewater of the five-year rolling average of annual spending on capital improvement projects
• Emergency Capital Reserve-minimum of 0.5% and target of 1% of s ystem replacement value for water, recycled water and wastewater
• Rate Stabilization Reserve-minimum 10% and target of 20% of rate revenues for potable and recycled water and a minimum 5% and a target of 10% of rate revenues for wastewater

The city’s Workers’ Compensation Fund and Risk Management Fund (General Li ability) will maintain a minimum reserve equal to the estimated o utstanding claims as calculated by a third-party administrator. Additional reserve amounts may be set aside as deemed appropriate based on a third -party actuarial study completed at two-year intervals. During the annual budget process, the target confide nce level will be compared with the projected fund balance, and, if the projected fund balance is greater than or lesser than the target, a plan to adjust the fund balance will be considered, using either or both increasing revenues th rough interdepartmental charges and one-time cash contributions from those funds contributing to the shortfall.

The Information Technology Asset Replacement Fund shall maintain a minimum reserve level defined as the amount of accumulated depreciation of c apitalized assets based on the original cost of each capitalized asset, and up to a maximum reserve level defined as the accumulated depreciation based on the estimated replacement cost of each capitalized asset.

The Vehicle Asset Replacement Fund shall maintain a minimum reserve level defined as the amount of accumulated depreciation of capitalized Fleet assets based on the original cost of each capitalized asset, and up to a maximum
reserve level defined as the accumulated depreciation based on the estimated replacement cost of each capitalized asset.
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Investment Policy
The city has established a formal Investment Policy. It is the policy of the City of Carlsbad to invest public funds not required for immediate day-to-day operations in safe, liquid an d medium-term investments that shall yield an acceptable return while conformin g to all California statutes. It is intended that the po licy cover the investment activities of all contingency reserves and inactive cash under the direct authority of the city. Investments of the city and its component units will be made on a pooled basis; however , investments of bond proceeds will be held separately if required.

Pension Funding Policy
The city’s Council Policy No. 86 – Pension Funding Policy embodies funding and accounting principles to ensure that resources will be available to fulfill the city’s contractual promises to its employees. The policy objectives include using actuarially determined contributions, or ADC, provided by CalPERS, funding the full amount of the ADC each year, maintaining no less than a combined minimum of 80% funded ratio, and demonstrat ing accountability and transparency by communicating all information necessary for ass essing the city’s progress toward meeting its pension funding objectives.

In the event the city is unable to meet the minimum combined pension funded ratio of 80% with current resources (i.e., without borrowing or usin g reserves), the Finance Direct or will identify a reasonable period to return to a minimum 80% funded ratio status.

Long Term General Fund Capital Funding Policy
The city’s Council Policy No. 91 – Long Term General Fund Capital Funding Policy ensures the needs of the city are met and demonstrates continued prudent fiscal management by providing a funding source for long-term, large value capital purchases. Many city assets demand large capital expenditures, examples include roads, building, parks, and information technology infrastructure. The city funds the General Fund portion of these necessary investments by adopting an annual budget that includes a transfer from the General Fund to one or more of the city’s long-term capital funds. These long-term capital funds include the Genera l Capital Construction Fund, the Infrastructure Replacement Fund and the Technology Investment Capital Fund. The city commits to targeting a transfer to the city’s long-term capital funds of 6% of budgeted General Fund revenues . The transfers are proposed during the annual budget process or on an as needed basis for the City Council’s consideration.

Full versions of these policies and other City Council policies are available on the city’s website at www.carlsbadca.gov/city-hall/laws-policies/council-policies.

Strategic Digital Transfor mation Investment Program
The Strategic Digital Transformation Investment Program, or SDTIP, is a comprehensive approach to planning for and funding digital transformation efforts throughout the city. Several documents inform this program, including the City Council-approved Conne cted Carlsbad: An Inclusive City Innovation Roadmap, the Internal Digital Information Network Action Plan, and the Information Technology Strategy, which are complemented by a five-year projected roadmap of digital transformation investments. The SDTIP is the strategic plan for technology and digital transformation combined with project descriptions, costs, fundi ng sources and timelines. The purpose of this new program is to provide for an annual investment strategy, not a commitment for spending, that outlines a five-year expenditure plan for future digital transformation and technolo gy projects and the corresponding revenues necessary to pay for them.
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Connected Carlsbad: An Inclusive City Innovation Roadmap In January 2019, city staff presented Connected Carlsbad: An Inclusive City Innovation Roadmap, designed to provide a high-level, organized guide outlining the principles that matter to the city in creating a more connected community.

This roadmap and its associated action plan were based on a combination of items, including:
• City Council approved projects,
• existing city documents,
• previous Information Technology assessments and interviews with departments, and • a global scan of other cities and best practices that have emer ged from leading smart city thinkers and Carlsbad-specific community engagement.

The Strategic Digital Transformation Investment Program expands on the Connected Carlsbad Roadmap to include a strategy for evaluating and prioritizing projects and a five-year investment roadmap that includes estimated costs and timelines. This new investment program continues to be organized into the five primary goal areas approved by City Council in Connected Carlsbad, listed below.
• Pursue Communitywide Digital Transformation focuses on the foundational elements, including connectivity, up-to-date hardware and software, and a robust se c u r i t y s t r a t e g y w h i l e p r o v i d i n g a n aspirational vision for the future.
• Build Capacity for Data-Driven Government focuses on the policies, procedures and staffing necessary for the city to fully capture the value of emerging models of data analytics. • Foster a Vibrant Civic Engagement Culture builds upon the first two goals with a human-centered perspective that an engaged city that uses data and technology in a way that respects people and their privacy will support a vibrant culture where residents, organiz ations and businesses are invested in their community and its future.
• Enhance Accessibility and Transparency recognizes that open government and approaching problem- solving from an accessibility perspective leads to better outcomes for all. • Promote Safety and Sustainability through Connectivity leads to understanding the interconnected nature of our communities that can achieve environmental, mobility and sustainability goals when approached in a cross-departmental and community informed manner.

Once City Council adopts the proposed Strategic Digital Transfo rmation Investment Program, projects receive an appropriation that authorizes spending in the amount specified for the adopted fiscal year only. Estimated budget information is shown for a five-year period to provide the most comprehensive information about known future projects. Spending authority in future years is not granted unt il adoption of the annual proposed SDTIP budget associated with each year.

Investing in Digital Transformation
As the city continues to grow and develop, the use of technolog y has also grown exponentially over the last two decades. The SDTIP outlines the financial resources needed to e nsure that the technology infrastructure is in place to enable the city to provide services to the community. Prudent financial planning will ensure that ongoing funding for investment in technology is available.
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SDTIP Project Evaluation

Making decisions on technology implementations is a challenging and complex task. The challenging nature of these decisions is exacerbated by the expanding reach of technology and the increasingly interdisciplinary nature of emerging technologies. A major component of the SDTIP is the es tablishment of a cross-departmental approach to technology leadership to evaluate, prioritize, budget for and a d o p t d i g i t a l t r a n s f o r m a t i o n e f f o r t s . A n e w administrative order has been developed that provides a collabo rative forum for key staff to validate and prioritize technology implementations. This approach also provides a struc tured venue to explore how particular configurations of a technology implementation may positively or negatively affect others within the organization.

The process to evaluate digital transformation initiatives is o ngoing and meetings may be held on a monthly, bimonthly or quarterly basis depending on the need.

A number of factors are considered when putting together projec t s f o r t h e f i v e - y e a r p r o g r a m . All digital transformation and technology projects shall be consistent with:

Proposed projects are evaluated and prioritized by a set of criteria that include:
• Alignment with City Council goal s and IT strategic plans, archi tecture, security and technology standards, including legislative and regulatory mandates, and administrative goals • Coordination of IT investments across the enterprise to avoid d uplication, maximizing the return on investment and increasing efficiency
• Effective articulation of the business case including valid operational benefits of the project • Accuracy and reasonableness of cost and benefit estimates • Consideration of potential project risks and identification of appropriate means to manage those risks • Adherence to standard project management practices
• Capacity of staffing resources to implement the project As the SDTIP is implemented throughout the year, staff will continually re-evaluate projects’ scopes, costs and schedules to responsibly and cost-effectively manage city resources.

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. . ·.
. . . . .
•
- ~ -.• . . . .
. •: .

SDTIP Fiscal Year 202 2-23 Appropriations
Going into fiscal year 2022-23, there were 33 continuing and ne w projects planned over the next five years at an estimated total cost of $27.34 million. Included in the $27.34 million is approximately $15.35 million in estimated new costs over the course of the same time frame to provide add itional funding for the continuation of existing projects as well as funding for new projects. Within the $15.35 million is approximately $3.94 million of estimated new appropriations for fiscal year 2022-23 for these same projects.

Pursue Communitywide Digital Transformation
$12.98 million
This goal includes updating connectivity, up-to-date hardware and software, and a robust security strategy.

Build Capacity for Data-Driven Decision Making
$1.78 million
This goal’s projects include the policies, procedures and staffing necessary for the city to fully capture the value of emerging models of data analytics. It builds a comprehensive ap proach to citywide data management to enable data-rich key performance metrics and effective operation of ci ty departments. A data policy and resources will be created to align departments with standards of data cataloging for compliance ease of data sharing.

Foster a Vibrant Civic Engagement Culture
$1.43 million
The city’s civic engagement cult ure builds upon the first two g oals with a human-centered perspective to use data and technology in a way that respects people and their privacy. Projects in this category will support a vibrant culture where residents, organizations and businesses are invested in their community and its future. xiii
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Estimated Total Projects Costs by Goal
FY 2022-23 to FY 2026-27
$27.34 million
Build Capacity for
Data-driven
Decision Making,
1,775,000 - 7%
Pursue
Communitywide
Digital Transformation,
12,981,500 - 48%
Enhance
Accessibility and
Transparency,
1,496,852 - 5%
Foster a Vibrant
Civic Engagement
Culture,
1,425,000 - 5%
Promote Security and
Sustainability through
Connectivity ,
9,664,015 - 35%

Enhance Accessibility and Transparency
$1.49 million
This goal recognizes that open government and approaching problem-solving from an accessibility perspective leads t o b e t t e r o u t c o m e s f o r a l l . P r o j e c t s i n t h i s c a t e g o r y i n c l u d e Civic Engagement with Open Data, Online Permitting/Electronic Reviews, Patron Print/Copy Management and a Virtual Permitting Counter.

Promote Security and Sustainability through Connectivity $9.66 million
Projects in this goal include the annual replacement of hardwar e and technology infrastru cture, a Facility Security Master Plan, the replacement of the Police Computer Aided Dispa tch System, and an enhancement to the 9-1-1 emergency system.

SDTIP Future Appropriations

The City of Carlsbad’s SDTIP for fiscal year 2022-23 to fiscal year 2026-27 outlines 33 projects at an estimated total cost of $27.34 million. Of the $27.34 million, $15.35 million is for new or increased funding for projects over the next five years. The information provided for future years reflects the most comprehensive snapshot of known or anticipated future projects as well as associated estimated costs.

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Estimated Future Projects Costs by Goal
FY 2022-23 to FY 2026-27
Build Capacity for Data­
driven Decision Making,
1,450,000 - 10%
Pursue Communitywide
Digital Transformation,
5,810,000 -38%
$15.35 million
Enhance Accessibility
and Transparency,
479,000 - 3%
Foster a Vibrant Civic
Engagement Culture,
500,000- 3%
Promote Security and
Sustainability throl@h
Connectivity,
7,111,380 - 46%

Capital Improvement Program

The City of Carlsbad Capital Imp rovement Program reflects the c ity’s ongoing commitment to maintaining the highest standards of quality fa cilities for our community today and in the future. It is a planning document, not a commitment for spending. The 15-year program outlines the expen diture plan for future capital projects and the corresponding revenues to pay for those expenditures.

Projects that are shown in the CIP are generally defined as any construction, rehabilitation or replacement of major infrastructure such as streets, libraries, parks, fire stations and administrative facilities, water, sewer and drainage facilities, and other facilities that are located on or in the ground. In most cases, the total construction cost of each of these assets is recorded and tracked as part of the city’s inventory of capital infrastructure assets and other city- owned property.

Once the City Council adopts the proposed annual CIP budget, pr ojects receive an appropriation that authorizes spending in the amount specified for the adopted fiscal year only. Estimated budget information is shown for a 15- year period to provide the most comprehensive information about known future projects. Spending authority in future years is not granted until adoption of the annual proposed CIP budget associated with each year.

The CIP is organized by the following project classifications:

Planning
Study
Plan
Assessment
Maintenance &
Operations
Technical master plans
Repair
Refurbishment/
rehabilitation
Modifications
Improvements
Maintenance program
Monitoring
Replacement
Upgrade
Capital Projects
Regulatory & Policy-
Driven:

Legal requirements,
compliance with Growth
Management Plan,
Climate Action Plan,
defined projects to
implement policies, plans
and goals adopted by the
City Council
Community
Enhancements: new
facilities, expansions,
parks & trails, traffic
signals, coastal
improvements
Project Accounting
CFD #1 Admin
Open space acquisition
Loans
Repayment/transfer
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Investing in Quality of Life
high
needs
repair,
city
is able
The City of Carlsbad’s philosophy is to take a
proactive, long-range planning approach to building
quality facilities and infrastructure that support the
priorities of the community. Prudent financial
planning has ensured ongoing funding to modernize,
and replace existing infrastructure projects through
numerous asset management programs. Since the
applies a comprehensive asset management
approach to infrastructure planning and budgeting it
to avoid more costly unexpected repairs or
operational needs and minimize the burden on
emergency expenditures.

As the city continues to grow and develop, there is a corresponding increase in the demand for development-related services and new facilities. To ensure that the necessary infra structure and facilities are built on a schedule that meets or exceeds this demand, the citizens of Carlsbad adopted a Growth Management Plan in 1986. The plan was established to manage development within the city by linking re sidential, commercial, and industrial development directly to standards for availability of public services and facilities.

The Growth Management Plan states that unless a standard level of facilities is available to meet new demands resulting from the city’s growth, development cannot proceed. R ecently, certain actions, such as imposing a moratorium, have been determined to be impermissible by the Cal ifornia Housing and Community Development Department, per Senate Bill 330, Housing Crisis Act of 2019, which became effective on Jan. 1, 2020.

The detailed level of planning required by Growth Management has allowed the city’s CIP to anticipate the funding needed for capital improvements in the next 15 years. Facilities such as community centers, parks and fire stations have been constructed and opened to the public under this program.

The CIP has been designed to specifically address areas where new or expanded facilities will be needed to maintain compliance with the adopted performance standards. With the adoption of the fiscal year 2022-23 CIP, compliance with the Growth Management Plan is continued.

CIP Project Evaluation
Development of the CIP is a team effort involving all operation al departments, the City Manager’s Office, the City Council, and the community. Community feedback on infrastructur e needs is considered and incorporated as appropriate. The CIP is fully vetted at multiple levels of the city organization by appropriate staff using an inclusive and transparent process and reviewed on a quarterly basis. xvi
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Projects were evaluated for the ability to
deliver realistic outcomes considering
anticipated revenue decreases in some
capital funding sources. The city remains
focused on matching existing resources with
reasonable and achievable project
schedules while continuing to work on
projects that are already underway. Existing
project balances were evaluated to
determine whether additional funding was
needed or if the existing balances were
adequate. Funding recommendations were
matched against project timing and
balanced against available funding sources.

As the CIP is implemented throughout the
year, staff continually re-evaluate projects’ scopes, costs and schedules to responsibly and cost-effectively manage infrastructure assets at the required levels of service throughout their lifecycle. Recommendations for project funding consider current project status, project scheduling and sequencing requirements, p roject constraints, and current staff capacity. Project charters are updated to include project description, location, summary of need, justification including any legislative or policy citations, cost estimates, and project scores.

CIP Fiscal Year 2022 -23 Appropriations

In the fiscal year 2022-23 CIP, there are approximately 226 con tinuing and new projects planned over the next 15 years. The fiscal year 2022-23 CIP outlines $42.6 million in new appropriations to provide additional funding for the continuation of existing projects as well as funding for 14 new projects. Projected revenues during the same fiscal year are estimated at $59.5 million.

Capital
Improvement
Program
Public health
and safety
City mission,
vision and
organizational
values
Community
values
Environmental
review
Governing and
policy
documents
Funding
availability
City
Council
goals
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Maintenance &
Operations
35%
FY 2022-23 Appropriations by Category
$42.6 million
Project
Accounting
16%
Capital Projects
49%

FISCAL YEAR 2022-23 APPROPRIATIONS BY PROJECT TYPE

Civic Buildings and Facility Maintenance
$1.7 million
This category includes a variety of facilities such as fire sta tions, libraries and the new City Hall. Costs include repair, maintenance and replacement of civic buildings.

Parks
$1.8 million
Projects include improvements and enhancements to existing park s, such as playground resurfacing, picnic areas and other needs identified by the community and in recently updated parks master plans.

Drainage
$3.3 million
The city’s drainage infrastructure plays an important role in handling storm water runoff flows, as well as maintaining the water quality of the city’s creeks, lagoons and ocean. As the city continues to age, it is increasingly necessary to balance repairing an d replacing the existing lines with enhancing the current infrastructure to accommodate future needs.

Sewer
$13.9 million
The city’s sewer, or wastewater, projects include numerous pipe line construction and rehabilitation projects, as well as improvements to the Encina Wastewater Trea tment facility. Most new lines are built and paid for with impact fees collected with new development.

Water and Recycled Water
$2.8 million
Future water and recycled water projects include construction of new pipelines, replacement of existing waterlines and reservoir improvem ents. The Carlsbad Municipal W ater District has been producing and delivering recycled water for over 30 years.

Transportation
$19 million
People of all ages and abilities want to go places safely and conveniently in Carlsbad, whether they drive, walk, bike, or ride a bus or train. The city continues to invest in modernizing roads, leveraging technology to improve traffic systems, and making timely repairs and rehabilitation of the roadways, bridges, sidewalks and other assets in public rights of way throughout the city.

CIP Future Projects

The CIP for fiscal year 2022-23 to fiscal year 2035-37 outlines approximately 246 projects at a cost of $695 million.

Long-range planning and responsible asset management play key roles in the development of future capital projects.

Using data from various infrastructure master plans, ongoing asset condition assessments, technical modelling, field i n s p e c t i o n s a s w e l l a s c o m m u n i t y f e e d b a c k , t h e i n f o r m a t i o n p r o v i d e d f o r f u t u r e y e a r s r e f l e c t s t h e m o s t comprehensive snapshot of known or anticipated future projects as well as associated estimated costs. xviii
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L -
•
,H, , , , ,

Unfunded Capital Improvement Projects

There are six projects identified in the CIP for which there is no identifiable funding source and, in some cases, where only partial funding has been identified. The city will investigate obtaining possible external funding, such as federal and state grants, loans, or other financing sources. Once fundi ng is identified for these projects, the project costs will have to be reviewed and updated to reflect actual cost estimates. The unfunded projects do not receive annual inflationary increases. Two projects are partially funded by th e T r a f f i c I m p a c t F e e p r o g r a m . T h e p r o g r a m w a s planned to generate enough revenue to pay for 20% of the total costs of these projects, leaving the remaining 80% unfunded.

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Future Project Costs By Type
FY 2022-23 to FY 2035-37
$695 million
Civic facilities
11%
Transportation
23%
Water /Recycled
Water
22%
Business Park Recreational Facility (Partial Funding)
Cannon Lake Park (6.7 Acres)
Parks
9%
Drainage
7%
Carlsbad Blvd. Mountain View To Northerly City Limits (Partial Funding) Carlsbad Blvd./ Palomar Airport Road (Partial Funding)
Carlsbad Blvd. Realignme nt- Segments 3-5
College Boulevard Extension

TOTAL UNFUNDED PROJECTS
$ 6,600,000
2,243,000
6,905,600
14,109,600
26,100,000
30,000,000
$85,958,200

Awards and Acknowledgements

The Government Finance Officers Association (GFOA) of the Unite d States and Canada awarded a Certificate of Achievement for Excellence in Financial Reporting to the city for its Annual Comprehensive Financial Report for the fiscal year ended June 30, 2022. This was the 25th consecutive year that the city has achieved this prestigious award.

To be awarded a Certificate of Achievement, a government unit must publish an easily readable and efficiently organized Annual Comprehensive Financial Report. This report mu s t s a t i s f y b o t h G A A P and applicable legal requirements.

A Certificate of Achievement is valid for a period of one year only. The city strives to annually produce an Annual Comprehensive Financial Report which will continue to meet the Certificate of Achievement Program’s requirements. This report will be also submitted to GFOA to determine eligibility for another certificate.

This report has been a comprehensive effort by many people from many different areas of responsibility. It could not have been accomplished without their help and the dedicated e f f o r t s o f a l l o f t h e f i n a n c e s t a f f , e s p e c i a l l y Roxanne Muhlmeister, Assistant Finance Director and Kim Riboni, Senior Accountant. I also appreciate the staff of Lance, Soll & Lunghard, LLP for the professional way in which the audit of this financial report was conducted. It has been a pleasure to work with them. Additionally, I would like to thank the City Council, the City Manager and the city’s Executive Management Team for their leadership and unfai ling support in maintaining the highest standards of professionalism in the management of the city’s finances.

Respectfully submitted,

Zach Korach
Finance Director
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o7Pri
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Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Carlsbad
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2022
~ p. ~
Executive Director/CEO
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7 As of 2/16/2024
Elected Officials
Keith Blackburn, Mayor
Melanie Burkholder, Council Member – District 1
Carolyn Luna, Council Member – District 2
Priya Bhat-Patel, Mayor Pro Tem – District 3
Teresa Acosta, Council Member – District 4
Sherry Freisinger, City Clerk
Craig Lindholm, City Treasurer
Leadership Team
Scott Chadwick, City Manager
Cindie McMahon, City Attorney
Geoff Patnoe, Assistant City Manager
Gary Barberio, Deputy City Manager, Community Services
Paz Gomez, Deputy City Manager, Public Works
Laura Rocha, Deputy City Manager, Administrative Services Michael Calderwood, Chief, Fire Department
Mickey Williams, Chief, Police Department
Maria Callander, Director, Information Technology
Sheila Cobian, Director, Legislative and Constituent Services Tom Frank, Director, Public Works Transportation
David Graham, Chief Innovation Officer
Jason Haber, Director, Intergovernmental Affairs
Emily Hasegawa, Engineering Manager, Public Works Construction Management & Inspections Zach Korach, Director, Finance
Kyle Lancaster, Director, Parks & Recreation
John Maashoff, Public Works Manager, Public Works Fleet & Facilities Faviola Medina, City Clerk Services Manager, Office of the City Clerk Mandy Mills, Director, Housing & Homeless Services
Jeff Murphy, Director, Community Development
Vicki Quiram, Director, Public Works Utilities
Kristina Ray, Director, Communication & Engagement
Suzanne Smithson, Director, Library & Cultural Arts
Judy Von Kalinowski, Director, Human Resources
James Wood, Director, Public Works Environmental Sustainability Boards and Commissions Chairs
Agricultural Conversion Mitigation Fee Advisory Committee – Carolyn Alkire Arts Commission – Barbara Chung
Beach Preservation Commission – Kathleen Steindlberger
Carlsbad Golf Lodging Business Improvement District Board – Tim Stripe Carlsbad Tourism Business Improvement District Board – Bill Canepa Community-Police Engagement Commission – Patrick Connolly Historic Preservation Commission – Chad Majer
Housing Commission – Tyler Collins
Library Board of Trustees – Stan Schatt
Parks & Recreation Commission – Robert Winston
Planning Commission – Peter Merz
Senior Commission – Kathryn Rangus
Traffic & Mobility Commission – Josh Coelho
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Office of the City Clerk
Faviola Medina
Police Department
Mickey Williams
October 16, 2023
Communication & Engagement
Kristina Ray
Intergovernmental Affairs
Jason Haber
Legislative & Constituent
Services
Sheila Cobian
Assistant City Manager
Geoff Patnoe
Finance
Zach Korach
Human Resources
Judy Von Kalinowski
Information Technology
Maria Callander
Innovation & Economic
Development
David Graham
City Attorney
Cindie McMahon
( City of
Carlsbad
Fire Department
Michael Calderwood

Financial Section

April 16, 2024
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April 16, 2024
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1611 E. Fourth Street, Suite 200
Santa Ana, CA 92701
(714) 569-1000
203 N. Brea Blvd, Suite 203
Brea, CA 92821
(714) 672-0022
21 Waterway Avenue, Suite 30089
The Woodlands, TX 77380
(936) 828-4587
2151 River Plaza Dr., Suite 150
Sacramento, CA 95833
(916) 503-9691
24422 Avenida de la Carlota, Suite 275
Laguna Hills, CA 92653
(949) 829-8299
www.lslcpas.com

INDEPENDENT AUDITORS’ REPORT

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

Report on the Audit of the Financial Statements

Opinions

We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information o f the City of Carlsbad, California (the “City”), as
of and for the year ended June 30, 2023, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.

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

Basis for Opinions

We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial State ments section of our report. We are required to be independent of the City and to meet our other ethical responsib ilities, 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.

Emphasis of Matter

Change in Accounting Principle

As described in Note 1 to the financial statements, in 2023, the City adopted new accounting guidance, GASB Statement No. 96, Subscription Based Information Technology Arrangements . Our opinion is not modified with respect to this matter.

Responsibilities of Management for the Financial Statements

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 an y currently known information that may raise substantial doubt shortly thereafter.

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To the Honorable Mayor and Members of the City Council
City of Carlsbad, 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 is sue 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 generally accepted a uditing standards and Government Auditing Standards will always detect a material m isstatement 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 generally accepted au diting standards and Government Auditing Standards, we:

• Exercise professional judgment and maintain professional skept icism 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 th ose risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

• Obtain an understanding of inter nal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed.

• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.

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

Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, the budgetary comparison schedule for the General Fund, and the required pension and other postemployment benefits schedules, as listed on the table of co ntents, presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accountin g Standards Board who considers it to be an essential part of financial reporting for placing the basic fin ancial statements in an appropriate operational, economic, or historical context. We have applied certain limite d procedures to the required supplementary information in accordance with auditing standards generally acc epted 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.

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

Supplementary Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The accompanying combini ng and individual fund financial statements and schedules (supplementary information) are presented for purpose s of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements.

The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financia l 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 supplementary information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Information

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

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

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated March 26, 2024, on our consideration of the City’s int ernal control over financial rep orting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreement s and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit p erformed in accordance with Government Auditing Standards in considering City’s internal control over financial reporting and compliance.

Brea, California
March 26, 2024
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Management’s Discussion and Analysis

Management of the City of Carlsbad (“city”) provides readers th is overview and analysis of the financial activities of the city for the fiscal year ended June 30, 2023. The intent is to assist the reader of these financial statements in better understanding the impact of financial decisions made by the city. This analys is will focus on the significant c hanges to explain the city’s overall financial condition. The information presented here sho uld be considered in conjunction with the additional information furnished in the letter of transmittal.

Overview of the Financial Statements

The financial statements section of the annual report consists of four parts – management’s discussion and analysis (this section), the basic financial statements , required supplementary information , and an optional section that presents combining statements for nonmajor governmental funds and internal service funds. Th e basic financial statements include two kinds of statements that present different views of the city.

• The first two statements are Government-wide Financial Statements that provide both long-term a n d short-term information about the city’s overall financial status.
• The remaining statements are Fund Financial Statements that focus on individual parts of the city government, reporting the city’s operations in more detail than the Government-wide Statements.

o The Governmental Funds Financial Statements detail how general government services, such as public safety and library services, were financed in the short-term, as well as what remains for future spending. o Proprietary Funds Statements offer short- and long-term financial information about the activities the city operates like businesses, such as providing water and wastewater services. o Fiduciary Funds Statements provide information about the financial relationships – such as assessment and business improvement districts – in which the city acts solely as a trus tee or agent for the benefit of others to whom the resources belong.

The financial statements also include notes that explain some of the information in the financial statemen ts and provide greater detail. The statements are accompanied by required supplementary information that further explain and support the information in the financial statements. In addition to these required elements is the combining fund statements section that provides financial information about the nonmajor governmental funds, internal service funds, and fiduciary funds, which are added together and presented in single columns in the basic financial statements.

The remainder of this overview section of management’s discussion and analysis (MD&A) explains the structure and content of each of the statements.

Government-wide Financial Statements

The Government-wide Financial Statements report information about the city as a whole, using accounting methods similar to those used by private-sector companies. The Statement of Net Position includes all of the city’s assets and liabilities. All of the current year’s revenues and expenses are accounted for in the Statement of Activities, regardless of when cash is received or paid.

The two Government-wide Financial Statements report the city’s net position and how it has changed. Net position – the difference between the city’s assets and liabilities – is one way to measure the city’s financial health, or position. Over time, increases or decreases in the city’s net position are an indica tor of whether the city’s financial health is improving or deteriorating, respectively. Additional non-financial factors s hould be considered, such as changes in the city’s property tax base and the condition of the city’s infrastructure, to assess the overall health of the city.

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The Government-wide Financial Statements of the city are divided into two categories:

• Governmental activities – Most of the city’s basic serv ices, such as police, fire, pub lic works, community services, and internal services are included here. Taxes, revenues from other governments and agencies, income from property and investments, grants and contributions, and charges for services finance most of these activities.

• Business-type activities – T h e c i t y c h a r g e s f e e s t o customers to cover the cost of certain services it
provides. The city’s water, wastewater, solid waste
and municipal golf course operations are the
primary business-type activities.

Fund Financial Statements

T h e F u n d F i n a n c i a l S t a t e m ents provide more detailed information about the city’s most significant funds – not the city as a whole. Funds are accounting devices used
by the city to keep track of specific sources of funding and spending for particular purposes.

Some funds are required by state law and bond
covenants, while the city establishes other funds to
control and manage money for particular purposes (such
as the developer impact fee funds) or to show that it is properly using certain taxes and grants (such as the
Section 8 Rental Assistance Fund).

The city has three kinds of funds:

• Governmental funds – Most of the city’s basic services are included in government al funds. These funds are used to account for (1) cash and other financial assets that can readily be converted to cash flow in and out, and (2) balances left at year-end that are available for future spending. Consequently, the Governmental Funds Statement provides a detailed short-term view that helps the reader determine the amount of financial r esources that can be spent in the near future to finance the city’s programs. The statements are presented on a modified accrual basis of accounting. A reconciliation between the long-term and short-term focus of the Government-wide Financial Statements is provided immediately following each statement. There are currently three governmenta l fund types being used by the city: the General Fund, special revenue funds, and capital project funds.

• Proprietary funds – Services for which the city charges customers a fee for a service are generally reported in proprietary funds. Proprietary funds, like Government-wide Financial Statem ents, provide both long- and short-term financial information, and are presented on an accrual basis of accounting.

There are two types of propriety funds, enterprise funds and internal service funds:

o Enterprise funds are used to report activities that provide business-type services, generally to external customers – such as water, wastewater, solid waste, and golf services. In both the Government-wide Financial Statements and the Fund Financial Statements, these funds are shown under business-type activities.

o Internal service funds are used to report activities that provide services and supplies for the city’s other programs and activities – such as fleet, workers’ compensation, risk/liability, and information technology.

• Fiduciary funds – These funds are used to account for situation s where the city’s role is purely custodial, such as the receipt, temporary investment, and remittance of fiduciary resources to individuals, private organizations, or other governments. All of the city’s fi duciary activities are reporte d in a separate Statement of Fiduciary Net Position. These activities are excluded from the city’s Government-wide Financial Statements because the city cannot use these assets to finance its operations.
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Required Components of the
Annual Financial Report
Management's
Discussion and
Analysis
Government­
wide Financial
Statements
Summary
Basic Financial
Statements
Required
Supplementary
Information
Notes to the
Financial
Statements
Detail

Financial Analysis of the City as a Whole

Net Position

The city’s combined net position as of June 30, 2023, as shown below, was $1.87 billion. The city’s net position increased by $5.6 million as compared to the prior fiscal year. This increase was heavily impacted by revenues exceeding expenses for the year which was offset by a substantial increase in net pension liability as well as an increase and decrease in deferred outflows and inflows of resources related to pension, respectively.

As noted earlier, over time, net position may serve as a useful indicator of the city’s financial position. For the city, assets and deferred outflows of resources currently exceed liabilities and deferred inflows of resources by $1.87 billion at the close of the fiscal year.

A large portion of the city’s net position, 62%, reflects its n et investment in capital assets (i.e., land, buildings, machine ry, equipment, and infrastructure), less any related debt used to acquire those assets that is still outstanding. The city uses these capital assets to provide services to residents; consequently, these assets are not available for future spending. Although the city’s investment in its capital assets is reported net of related debt, the resources needed to repay this debt must be provided from other sources since the capital assets themselves would no t be used to pay for these liabilities. The net investment in capital assets for the city incr eased slightly during fiscal ye ar 2022-23 due primarily to the progression of existing capital projects netted with a decrease in outstanding debt (primarily Recycled Water).

Of the city’s total net position, 15.4% represents resources that are subject to external restrictions on usage. The remaining balance of unrestricted net position ($424.0 million) may be used to meet the city’s ongoing obligations to residents and creditors.

The remaining net position is unrestricted, meaning it can be used for future spending and largely coincided with the excess of revenues over expenditures which were offset by an increase in the net pension liability.

Total
Percentage
Change
2022 2023 2022 2023 2022 2023 2022-23
Current and other assets $680.1 $690.9 $217.1 $220.5 $897.2 $911.4 1.6 % Net OPEB asset 0.6 0.0 0.1 0.0 0.7 0.0 -100.0%
Capital assets 808.5 812.3 367.9 363.5 1,176.4 1,175.8 -0.1% Total assets 1,489.2 1,503.2 585.1 584.0 2,074.3 2,087.2 0.6% Deferred outflows 39.4 85.4 2.9 6.6 42.3 92.0 117.5%
Other liabilities 59.7 30.6 14.1 12.7 73.8 43.3 -41.3%
Net OPEB liability 0.0 2.6 0.0 0.3 0.0 2.9 N/A
Net pension liability 72.8 184.9 4.8 13.6 77.6 198.5 155.8% Long-term debt outstanding 0.0 31.7 12.4 10.8 12.4 42.5 242.7% Total liabilities 132.5 249.8 31.3 37.4 163.8 287.2 75.3% Deferred inflows 74.7 13.7 10.5 5.1 85.2 18.8 -77.9%
Net positi on
Net investment in
capital assets 808.5 809.1 355.5 352.5 1,164.0 1,161.6 -0.2% Restricted 249.3 249.2 38.9 38.4 288.2 287.6 -0.2%
Unrestricted 263.6 266.8 151.8 157.2 415.4 424.0 2.1%
Total net position $1,321.4 $1,325.1 $546.2 $548.1 $1,867.6 $1,8 73.2 0.3% Total

CITY OF CARLSBAD'S NET POSITION
(in millions of dollars)
Governmental
Activities
Business-Type
Activities
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Changes in Net Position

The condensed summary of activities below shows that net positi on increased by $5.6 million during the year. This increase occurs when revenues earned are greater than expenses incurred.

There were several reasons for the increase in net position:

• Continued recovery from the adverse fiscal impacts of COVID-19 and significant inflatio n sustained by consumer demand, specifically with sales tax and transient occupancy tax. • Fiscal discipline implemented by the city due to uncertainty su rrounding COVID-19 restrictions and the economy resulted in budgetary savings in the prior fiscal year and alth ough spending has been moving back to more normal levels, there was still significant budget savings that occurred during fiscal year 2022-23. • The city also experienced significant increases in investment income and gains (fair market value adjustments) when compared to the prior fiscal year .

Total
Percentage
Change
2022 2023 2022 2023 2022 2023 2022-23
Revenues
Program revenues
Charges for services $19.4 $20.1 $79.6 $78.9 $99.0 $99.0 0.0% Operating grants and contributions 20.4 14.1 0.2 0.2 20.6 14.3 -30.6% Capital grants and contributions 9.9 13.0 0.9 5.2 10.8 18.2 68.5% General revenues
Property taxes 81.0 88.2 4.7 5.1 85.7 93.3 8.9% Sales and use taxes 51.2 56.2 - - 51.2 56.2 9.8% Other taxes 47.6 49.7 - - 47.6 49.7 4.4% Income from property and investments (22.1) 11.0 (7.7) 2.6 (29.8) 13.6 -145.6% Other 1.3 4.5 2.2 1.6 3.5 6.1 74.3% Total revenues 208.7 256.8 79.9 93.6 288.6 350.4 21.4% Expenses
General government 14.8 22.8 - - 14.8 22.8 54.1% Public safe ty 81.1 99.5 - - 81.1 99.5 22.7% Community se rvice s 59.0 76.4 - - 59.0 76.4 29.5% Public works 39.2 54.1 - - 39.2 54.1 38.0% Carlsbad Municipal Water District - - 53.6 54.2 53.6 54.2 1.1% Golf course - - 11.7 12.2 11.7 12.2 4.3% Wastewater - - 17.9 2

0.2 17.9 20.2 12.8% Solid waste - - 4.7 5.4 4.7 5.4 14.9% Total expenses 194.1 252.8 87.9 92.0 282.0 344.8 22.3% Excess (deficiency) before transfers 14.6 4.0 (8.0) 1.6 6.6 5.6 -15.2% Transfers (1.3) (0.3) 1.3 0.3 - - 0.0% Increase (decrease) in net position 13.3 3.7 (6.7) 1.9 6.6 5.6 -15.2% Beginning position 1,308.1 1,321.4 552.9 546.2 1,861.0 1,867.6 0.4% Ending net position $1,321.4 $1,325.1 $546.2 $548.1 $1,867.6 $1,873.2 0.3% Activities Activities Total

CITY OF CARLSBAD'S CHANGES IN NET POSITION
(in millions of dollars)
Governmental Business-Type
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Approximately 76% of the revenues of the city’s governmental ac tivities are generated through taxes collected (i.e., pro perty tax, sales tax, transient o ccupancy t ax, et c. ), and approximately 84% of the city’s business-type revenue is generated through charges for services. The chart below graphically depicts the city’s revenue sources.

During the prior fiscal year, due to pent-up demand and the eas ing of restrictions related to COVID-19, the fiscal recovery was accelerated, and the city experienced historically high levels of revenues, notably for sales and transient occupancy tax.

During fiscal year 2022-23 the city continued to see recovery from COVID-19 as well as an increase due to inflation sustained by consumer demand, particularly in sales tax and transient occupancy tax.

Sales tax ended the fiscal year with $56.2 million and the year -over-year increase of $5.0 million or 9.8% was driven by the city’s transportation and light industry groups. The largest ec onomic segments in the city are automobile dealers, general retail stores, and restaurants. T ogether, they generate 76% of the city’s sales tax revenues. Transient occupancy tax ended the fiscal year with $34.3 million, an increase of $1.9 million o r 6 % , a n d w a s d r i v e n b y a c o m b i n a t i o n o f pent-up demand after COVID-19 and an increase in average daily room rates.

The city’s largest revenue source, property taxes, increased due to assessed values increasing, mainly in residential properties.

This is the tenth year in a row that Carlsbad’s assessed values have increased from year to year, and in line with assessed value increases with other citie s in San Diego County for the year. This reflects continued strength in the regional housing market. The increase in this year’s assessed values is due to a large increase in the assessed values of residential propertie s in the city; the city saw smaller increases in commercial and industrial property values for the year. This is the eighth year in a row since the Great Recession ended that the city saw increas es in assessed values in all three property components (residential, commercial and industrial).

When compared to the prior fiscal year, business licenses were down 4% in fiscal year 2022-23. The decrease is due to a reduction in payments received for overdue business license ren ewals and penalties that were received last year and as a result of COVID-19. Development revenues increased 15% over the prior year as both residential and industrial/commercial saw increased building activity.

Income from property and investments was heavily impacted by unrealized gains created by adjusting the city’s investments to their fair market value on June 30, 2023. Rising inflation t hroughout the fiscal year triggered interest rate hikes from th e Federal Reserve which had a substantial impact on the market va lue of the city’s portfolio; ho wever, with rising rates, the city’s portfolio began to see continued increases in its monthly yield.

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Sources of Revenue for Fiscal Year 2022-23
$350.4 Million
■ Charges for Services 28%
■ Property Taxes 27%
Sales Taxes 16%
■ Federal and State Aid 4%
■ Contributions from Property Owne rs 5%
Transient Occupancy Taxes 10%
Other Taxes and Revenues 10%

The primary contributors to the city’s charges for services are water and wastewater customers. A slight decrease in total water revenues was driven primarily by reduction volume which was offset by rate increases implemented in January 2022.

Wastewater charges increased due to rate increases and development throughout the city. Together, these factors led to an overall increase in charges for services for the year for both water and wastewater. Additionally, the city’s municipal golf course experienced an increase in charges for services supported by continued demand.

The total cost of all programs and services was $344.8 million in fiscal year 2022-23 which was higher (22.3%) than prior fiscal year costs of $282.0 million. The majority of the increase in p r o g r a m c o s t s c a m e f r o m t h e a d d i t i o n o f 2 4 n e w full- time and 3.4 full-time equivalent part-time positions as well as negotiated and contract u a l s a l a r y a n d b e n e f i t c o s t increases. Increases were also driven by a return of travel and training costs, increases in workers’ compensation and risk claim liabilities and increases in pension liabilities as a res ult of unfavorable net investment returns experienced by CalPER S in fiscal year 2021-22. Each year, supplemental budget requests, in addition to the city’s ongoing base budget, are considered.

In FY 2022-23, budget items such as the replacement of self-con tained breathing apparatus for the fire department, a study for beach sand replenishment, a take home vehicle program for the police department, an update to the Sustainable Mobility Plan Element and $2 million dollars set aside for the Safer Streets Together plan as a result of the City Council declaring a local emergency contributed to the increase. The city’s water d istrict also saw increases as the cost of water and amount of water purchased increased.

• General Government (7%)
This segment of the city is divided into three major groups: Po licy & Leadership, Administrative Services and non-departmental charges. The Policy & Leadership group encompa sses all elected officials, t he City Manager and City A t t o r n e y o f f i c e s , t h e C o m m u n i c a t i o n s & E n g a g e m e n t t e a m , a n d t h e L e g i s l a t i v e & C o n s t i t u e n t S e r v i c e s t e a m . T h e Administrative Services group includes Finance, Human Resources ( i n c l u d i n g W o r k e r s ’ C o m p e n s a t i o n a n d R i s k Management), Information Technology, and Innovation & Economic Development. Non-departmental also includes any special projects directed by the City Council.

• Public Safety (29%)
Public Safety remains a top City Council priority. This major service area includes the Police Department, whose mission is to protect and serve the community with integrity, professio nalism and valor. The Fire Department is the other component of this major service area with a mission to enhance the quality of life by delivering exceptional services in safeguarding lives, property, and the environment.
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Functional Expenses for Fiscal Year 2022-23
$344.8 Million
■ General Government
• Public Safety
■ Community Services
■ Public Works
■ Water
■ Golf Course
Wastewater
■ Solid Waste
7%
29%
22%
15%
16%
3%
6%
2%

• Community Services (22%)
Community Services consists of Library & Cultural Arts, Parks & Recreation, Community Development and Housing & Homeless Services. These city service areas ensure th e city’s planning and building policies are carried out, foster lifelong learning, support strong neighborhoods, administer affordable housing and homeless response programs, attend to the community’s health and wellness and promote trans p a r e n c y i n g o v e r n m e n t . L i b r a r y & C u l t u r a l A r t s provides educational, informational and cultural arts services for all community residents, which contribute to quality of life by supporting lifelong learning, the pursuit of knowledge, and creating the availability of community gathering places.

Parks & Recreation offers comprehensive opportunities for meeting the recreational and social needs and interests of the community by providing programs for all segments of the population. Community Development’s primary roles include the day-to-day administration of the local, state, and federal land use regulations, promoting economic and business development, protecting life and property, enhancing public health, and preserving the environment.

C o m m u n i t y D e v e l o p m e n t e n c o m p a s s e s L a n d U s e P l a n n i n g , B u i l d i n g , Code Enforcement, and Land Development Engineering.

• Public Works (15%)
Public Works is responsible for building and maintaining all ci t y i n f r a s t r u c t u r e a s s e t s . T h i s s e r v i c e a r e a i n c l u d e s Public Works Administration, Facilities & Fleet, Environmental Sustainability, Transportation, Construction Management & Inspection and Utilities. Const ruction Management & Inspection manages construction of major projects, inspection and oversight of private development grading, stormwater and im provements inspection and oversight of all activity in the public right-of-way. Environmental Sustainability oversees the climate action plan program, the habitat management plan program, the sustainable materials management program, solid waste, and provides coordination of the municipal component of the National Polluta nt Discharge Elimination Syste m Municipal Storm Water Permit. Fleet & Facilities supports the maintenance of city vehicles and facilities. The Transportation Department cares for road infrastructure and projects, keeps people and traffi c moving, maintains streets an d storm drains, maintains street lighting, and provides incident response for city and private property.

• Water (16%)
The Carlsbad Municipal Water District (CMWD), a subsidiary of the city, provides potable and recycled water service to approximately 28,900 connections within a 32.3 square mile serv ice area. CMWD purchases 100% of its potable water, which includes a local supply of desalinated seawater, as treated water from the Metropolitan Water District and the San Diego County Water Authority. CMWD also provides recycled water for irrigation purposes which is produced at the Carlsbad Water Recycling Facility, as well as purchased from the Vallecitos Water District.

• Golf Course (3%)
The city opened a municipal golf course in the summer of 2007, further enhancing the recrea tional activities the city offers. The municipal golf course, The Crossings at Carlsbad, i s an 18-hole golf course set in the rolling hills and canyons of Carlsbad. With ocean views, a high-quality golf experience, a first-class restaurant and clubhouse, and connections to hiking trails, The Crossings at Carlsbad is a destination for golfers and non-golfers alike.

• Wastewater (6%)
The city operates and maintains a sanitary wastewater collectio n system that provides wastewater services to approximately two thirds of the city’s population, covering app r o x i m a t e l y 7 4 % o f t h e g e o g r a p h i c a r e a o f t h e c i t y .

Wastewater is treated by the Encina Wastewater Treatment Plant, a facility jointly owned by the cities of Carlsbad, Vista and Encinitas; the Leucadia Wastewater District; the Vallecitos Water District; and the Buena Sanitation District.

• Solid Waste (2%)
The Solid Waste Division administers and monitors the solid waste contract and the Palomar Transfer Station agreement and is responsible for ensuring the waste reduction and recycli ng components of the Source Reduction and Recycling Element and Household Hazardous Waste Element comply with state mandated diversion and disposal requirements.

Also included in this section is the Storm Water Protection Program, whose goal is to provide leadership and stewardship of the city’s resources protecting the city’s beaches, creeks and lagoons.

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The following sections provide information about the operations of the governmental and business-type activities.

Governmental Activities

The increase in net position for governmental activities was $3 .7 million. Total revenues from governmental activities were $256.8 million ($47.1 million in program revenues and $209.7 million in general revenues) and were offset by $252.8 million in total costs of governmental activities and $0.3 million in transfers out.

T h e t a b l e b e l o w p r e s e n t s t h e t o t a l c o s t o f e a c h o f t h e c i t y ’ s major programs, as well as each program’s revenue (fees generated by the activities, contributions, and intergove rnmental funding). The net cost (the difference between adjoining bars in the graph) shows the financial burden that was placed on the city’s taxpayers by each of these programs (costs covered by general revenues).

Revenues are generated through several sources to cover the cos t of the city’s programs. Total revenues of $256.8 million include fees and charges paid by those who directly benefit from the programs ($20.1 million), grants and contributions from other governments, organizations and property owners which subs idize certain programs and projects ($27.0 million), and taxes and other revenues (such as income from property and investments) received by the city to pay for the “public benefit” portion of the city’s services ($209.7 million).

Community Services revenues are derived from development activi ties throughout the city, ho using assistance programs, parks and recreation fees, and library fees. A large portion of Community Services revenues are comprised of housing assistance programs (Section 8 Rental Assistance, affordable housing loan repayments, and developers paying into the A f f o r d a b l e H o u s i n g T r u s t F u n d ) a s w e l l a s c h a r g e s f o r d e v e l o p m ent related services. As expected, development activity reflected a moderate decrease from the prior fiscal year, offsetting only a portion of the program expenses.

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$120
$100
$80
$60
$40
$20
$0
Governmental Activities
Program Revenues and Expenses
Fiscal Year 2022-23
(in millions)
$99.5
$76.4
$54.1
$22.8
$2.5
-General
Government
$8.1
-Public Safety Community Services Public Works
■ Program Revenues $47.1 ■ Program Expenses $2 52.8

The majority of Public Works revenues are used to acquire and b uild capital assets (versus covering operating expenses). In addition, the donation of capital assets from developers is reflected in the program revenues for Public Works. Capital assets are generally constructed or purchased once sufficient funds have accumulated to pay for the entire asset cost. Several years ago, the city entered a new stage of its lifecycle, from a developing or growing stage, to a mature and maintenance focused stage. As the city continues to mature and approach buildout, t here will be fewer master planned projects. In past years, these projects constructed new facilities, roads, parks, and ot her city-owned infrastructure. The city is shifting its focus towards maintenance of existin g facilities and will use funding sources such as the Infrastructure Replacement Fund to maintain and replace these assets.

Business-type Activities

Program revenues for the city’s business-type activities totale d $84.3 million for the year, while program expenses equaled $92.0 million.

Water program revenues are generated primarily from the sale of water, but also from developer donated assets and grants.

While program expenses were higher than revenues, the fiscal ye ar ended with a positive change in net position the water program from $5.1 million in general revenues combined with int erest from an increase in rates on a higher cash balance.

While revenues increased from annual water rates in January 2022 and 2023, this was offset by a decline in water volume sales from significant rainfall and statewide drought restricti ons. Expenses were driven by 7 .7% increases for the cost of purchased water.

Wastewater program revenues of $21.4 million were slightly high er than program expenses of $20.2 million. An increase in revenue was driven by annual rate increases, and significant ca pital contributions from new development. Expenses are higher mostly from Encina operations and depreciation from new and replacement assets.

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$60
$50
$40
$30
$20
$10
$0
$54.2
Water
Business-Type Activities
Program Revenues and Expenses
Fiscal Year 2022-23
(in millions)
$21.4 $20.2
$11.0 $12.2
Wastewater Golf Course
$5.4
~-
Solid Waste
■ Program Revenues $84.3 ■ Program Expenses $92.0

The city’s golf course enterprise was in its 16th full year of operation and finished the fiscal year with a net loss of $1.2 million. The demand for golf has remained significant in t he region and at the city’s municipal course. The course witnessed over 72,000 rounds played which significantly contributed to the golf course revenues sufficiently funding normal golf course operating expenses (i.e., excluding depreciation expense).

Solid waste revenues are primarily generated from fees charged to waste removal services customers to support the city’s integrated waste management plan which include recycling effort s and proper waste disposal programs. Expenses were planned to surpass revenues as many waste management programs h ave increased in level of effort and cost, such as solid waste, recycling, and organics management services, household hazardous waste collection and disposal, and environmental outreach and education. Despite the current year loss of $3.0 million, the fund has sufficient reserves.

Capital construction expenses are spread over the life of an asset as annual depreciation charges (program expenses) and are not reflected as an expense in the year acquired.

A more detailed discussion of each of the enterprises can be found in the Proprietary Funds Section.

Financial Analysis of the City’s Funds

As noted earlier, the city uses fund accounting to ensure compliance with finance related legal requirements. In the current A n n u a l C o m p r e h e n s i v e F i n a n c i a l R e p o r t , t h e c i t y i m p l e m e n t e d G A SB Statement No. 91, Conduit Debt Obligations, GASB Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangements, GASB Statement No. 96, Subscription-Based Information Technology Arrangements and GASB Statement No. 100, Accounting Changes and Error Corrections. More information on these pronouncements can be found in Note 1 of the financial statements.

Governmental Funds

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

There are five fund balance classifications: nonspendable, rest ricted, committed, assigned, and unassigned. These fund b a l a n c e c l a s s i f i c a t i o n s c o m p r i s e a h i e r a r c h y b a s e d p r i m a r i l y o n t h e e x t e n t t o w h i c h a g o v e r n m e n t i s b o u n d t o o b s e r v e constraints imposed upon the use of the resources reported in governmental funds. At the end of the current fiscal year, the city’s governmental funds reported combined ending fund balances of $590.7 million, up $15.7 million from the year before.

Approximately 0.4% ($2.2 million) constitutes nonspendable fund balances, mostly comprised of advances and loans to other 14 April 16, 2024
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Governmental Fund Balances at June 30, 2023
$590.7 Million
■ Nonspendable
■ Restricted Purposes
■ Committed
■ Assigned
Unassigned

0.4%

42.2%

0.2%

34.1%

23.1%

funds. Restricted fund balances can only be spent for a specific purpose stipulated by law and make up about 42% ($249.2 million). Assigned fund balances are intended to be used by the city for specific purposes, but do not meet the criteria to be classified as restricted or committed. These make up over 34% ($201.4 million) of the city’s fund balance. Unassigned fund balance is 23% ($136.8 million) of the overall fund balance, which is available for spending at the City Council’s discretion.

The General Fund is the main operating fund of the city, and at the end of the fiscal year had a total fund balance of $182.8 million, an increase of $20.7 million from the prior fiscal year. This resulted from continued recovery from COVID-19 and significant inflation sustained by consumer demand as prope rty, sales, and transient occupancy tax revenues reached historical levels. And while spending has recovered to near nor mal levels, there is still an overall awareness of fiscal responsibility throughout the city.

The unassigned fund balance portion of the General Fund was $13 6.8 million, an increase of $26.9 million from last fiscal year. This increase resulted from (before transfers out) revenues in excess of expenditures of approximately $44.9 million. In September 2022, the City Council approved a total of $10.6 million of additional transfers to the Workers’ Compensation, Risk Management, and Fleet Maintenance Funds in an effort to address the health of each respective fund’s net position. Of the total $24.2 million in transfers out of the General Fund, $13.3 million were used to fund future capital projects, $0.3 million were used for operating subsidies and $10.6 million were used to assist with the rising activity and costs within the city’s internal service funds.

The city’s General Fund Reserve Policy, outlined in City Counci l Policy No. 74, commits the city to maintaining General Fund reserves at a target of 40% of General Fund annual operating ex penditures. The total reserve level is to be calculated using the prior fiscal year’s adopted General Fund budgeted expenditures and is outlined below:

Actual Target
Unassigned General Fund balance at June 30, 2023 136.8$ 79.4 $ Fiscal year 2022-23 adopted General Fund budgeted expenditures 198.4$ 198.4$ General Fund reserve percentage 69% 40%

GENERAL FUND RESERVE BALANCE
(in millions of dollars)
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A summary of the General Fund’s revenues, expenditures and changes in fund balance is shown below.

The Community Facilities District No. 1 Fund continues to collect assessments for the future construction of city infrastructure and facilities which includes projects such as Veteran’s Park, a centralized maintenance and operations center for Public Works and Parks Maintenance and a new city hall complex.

The General Capital Construction Fund used a portion of its exi sting fund balance towards the completion of the new Fire Station No. 2, facilities to house the temporary Fire Station N o. 7, the refurbishment of the Police and Fire Headquarters building, Lake Calavera Outlet Improvements and various other projects. The expenditures were partially offset by a transfer from the General Fund for future projects.

The fund balance in the Infrastructure Replacement Fund increas ed as the city continued the annual transfer of funds from the General Fund for the future replacement of existing infrastructure and facilities. Projects for the year included the Police and Fire Headquarters refurbishment, a fuel island at the Fleet Service Center, roof repairs at Leo Carrillo Ranch, and various other infrastructure improvement projects.

Total
Increase Percentage
(Decrease) Change
2022 2023
Revenues
Taxes $178.8 $193.2 $14.4 8.1%
Intergovernmental 7.9 2.5 (5.4) -68.2%
Licenses and permits 3.2 3.7 0.5 14.4%
Charges for services 9.8 10.8 1.0 9.9%
Fines and forfeitures 0.3 0.4 0.1 16.6%
Income from property and investments (5.6) 7.1 12.7 -227.5% Miscellaneous 1.2 1.9 0.7 60.0%
Total revenues 195.7 219.6 23.9 12.2%
Expenditures
General government 22.0 23.0 1.0 4.5%
Interdepartmental charges (5.3) (6.0) (0.7) 13.2%
Public safety 82.0 85.4 3.4 4.1%
Community services 45.0 48.7 3.8 8.3%
Public works 20.1 22.3 2.3 11.2%
Capital outlay 2.7 1.3 (1.4) -50.9%
Total expenditures 166.4 174.7 8.4 5.0%
Excess (deficiency) before transfers 29.3 44.9
Transfers in 0.0 0.0
Transfers out (27.0) (24.2)
Increase (decrease) in fund balance 2.3 20.7
Beginning fund balance 159.8 162.1
Ending fund balance $162.1 $182.8
2022-23
Total

STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE

GENERAL FUND
(in millions of dollars)
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The Technology Investment Fund, which is funded by an annual tr ansfer of funds from the General Fund, is used for investments in future digital transformation and technology projects. Projects during fiscal year 2022-23 included audio visual upgrades in city conference rooms, investments in the city’s di gital information network, t h e b e g i n n i n g s t a g e s o f t h e replacement of the computer aided dispatch system in public saf ety, technology upgrades in the City Council chambers, an expansion of the city’s records management system and other various information technology projects.

During the year, the city continued to set aside money for the construction of various projects within these and other governmental funds. Historically, the city has not issued debt to fund the construction of capital projects and sets aside funds on an annual basis until sufficient funds have been collected for the construction of specific projects. In addition, projects will not be constructed until anticipated annual operating costs can be absorbed into the city’s budget without creating a deficit.

Proprietary Funds

The purpose of the city’s proprietary fund sections is to provi de short-term and long-term financial information about the city’s business-type activities. The analysis focuses on the de termination of operating income, changes in net position (cost recovery), financial position, and cash flows.

The Carlsbad Municipal Water District (CMWD) funds experienced an operating loss of approxi mately $7.6 million for the year. Operating revenues were approximately $46.9 million and operating expenses were approximately $54.4 million. Water purchases was one of the larger factors in the opera ting loss a nd caused by cost increases of water purchased from the Metropolitan Water District and the San Diego County Water Authority (suppliers of the CMWD’s potable water). The loss is attributable to a lower volume o f water sales driven by higher than expected rainfall in the current year, and statewide drought restrictions. This was offset by a 2% increase in CMWD’ s water rates effective January 2023. Nonoperating income included property and investmen ts of $1.9 million and property taxes of $5.1 million. Income before transfers, capital contributions and special items for the year was ($0.7) million.

The Wastewater Fund had an annual operating loss of $0.6 millio n for the fiscal year. Total revenues from operations were up $3.4 million from the prior year, due primarily to rate increases. Operating expenses were up $2.5 million and were primarily the result of the increased capital improvements offs et by a decrease in administration and general compared to the previous fiscal year. Nonoperating revenues resulted in a $0.4 million gain driven by a higher value market value adjustment for the city’s investment.

In the sixteenth year of operation, the Golf Course Fund had an operating loss of $1.2 million. E xcluding depreciation of the enterprise's assets ($3.4 million), the Golf Course Fund’s net income was $2.2 million. Revenues exceeded expectations in the current year due to a continued strong demand for rounds combined with an increase in green fees during the year. While revenue increased, golf related costs are generally fixed in nature and did not increase at the same rate.

Solid Waste Operations and Storm Water Programs are combined on the city’s financial reports and showed a net operating loss of $2.8 million for the year. Revenues were lower than the previous fiscal year from changes in the collection of certain stormwater fees which results in a decline in revenue but aligns fees with regulatory standards, and expenses in the solid w a s t e f u n d i n c r e a s e d d u e t o i n c r e a s e s i n t h e r e c y c l i n g a n d o r g anics management services and programs. Nonoperating revenues resulted in a $0.4 million increase to the $2.8 million operating loss before transfers and capital contributions.

The unrestricted net position for the Water, Golf Course, Waste water and Solid Waste Operations at the end of the year amounted to $154.7 million, or approximately 28% of the total e nterprise funds net position. This unrestricted balance increased mostly from positive operating performance excluding depreciation. Each fund’s unrestricted net position may be used for rate stabilization for the respective fund’s services, fluctuations in operating expenses, and unforeseen repairs and maintenance. Approximately $38.4 million, or 7%, of the net pos ition of all the proprietary funds are restricted for future capital construction of new and replacement water and wastewater infrastructure assets. Since funding for the replacement of infrastructure assets is not restricted, it is reflected in the Statement of Net Position as unrestricted. The city does, however, account for and monitor these amounts in separate fund s t o e ns ur e t ha t w a t e r a n d w a s t e w a t e r a s s e t s ca n be replaced when needed.
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Council Policy No. 96 – Utilities Reserve Policy is designed to establish guidelines to ensure the fiscal stability of the pot able water, recycled water and wastewater funds. The annual budget process and the setting of utility user rates and charges will be used to achieve and maintain the various target reserve levels. The policy aims to maintain minimum and target reserves for the following areas:

• Operating Reserve-minimum of 90 days and target of 120 days of operating costs for the operating funds of potable water, recycled water and wastewater funds.
• Debt Service Reserve-100% of required annual debt service for potable water, recycled water and wastewater. • Capital Construction Reserve-minimum 50% and target of 100% for p o t a bl e a nd r e c ycl e d w a t e r a nd a m i ni m um 25% and a target of 50% of wastewater of the five-year rolling average of annual spending on capital improvement projects.
• Emergency Capital Reserve-minimu m of 0.5% and targe t of 1% of system replacement value for water, recycled water and wastewater.
• Rate Stabilization Reserve-minimum 10% and target of 20% of rat e revenues for potable and recycled water and a minimum 5% and a target of 10% of rate revenues for wastewater.

Operating
(working capital) Debt service
Capital
construction 5-
year average
Emergency capital Rate stabilization
Days of operating
costs
Percent of annual
debt service
Percent of 5-year
rolling average
Percent of system
replacement value
Percent of rate
revenues
Potable and recycled water
Operating Budget $66.6 $50.3
Debt Service Payment $1.9
Capital Improvement $4.2
Repl acement Val ue $1,846.0
Minimum 90 100% 50% 0.5% 10%
Target 120 100% 100% 1% 20%
T arge t (in m illions) $21.9 $0.6 $4.2 $18.5 $50.5
Wastewater
Operating Budget $23.1 $21.9
Capital Improvement $8.5
Repl acement Val ue $780.0
Minimum 90 100% 25% 0.5% 5%
Target 120 100% 50% 1% 10%
T arge t (in m illions) $7.6 N/A $4.3 $7.8 $2.2

UTILITIES RESERVES
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General Fund Budgetary Highlights for Fiscal Year 2022-23

Management monitors revenues during the year and updates estimated revenue figures when new information is received.

General Fund revenue estimates were revised minimally during the year, as compared to the originally budgeted estimates.

Some of the factors that led to the $1.5 million increase in revenue estimates included:

• Adult literacy and family literacy grant funds received during the year. • Building permit revenue received in excess of original budget estimates. • Developer deposits received during the year to be used to pay for developer funded studies and reports.

The increase from the total original expenditure and transfers adopted budget to the final budget amounted to $31.3 million and was primarily due to:

• Transfers of $10.6 million to pri marily fund increased actuaria l claim estimates in the Worker’s Compensation and Risk Management Internal Service Funds and increased operating costs in the Fleet Maintenance Internal Service Fund.
• $3.1 million to purchase patrol vehicles for the Police take home vehicle program. • $114,000 for a cost increase on a previously approved fire engine purchase. • $60,000 for the remaining fiscal year 2022-23 program costs for the limited stay motel voucher program. • The appropriation of new grant money received during the fiscal year. • Developer funded reports and studies.
• Outstanding purchase orders at June 30, 2022 totaling $11.9 million carried forward into fiscal year 2022-23. • The carryforward of other unspent funds at June 30, 2022 in the amount of $3.7 million planned to be used for:
o Ambulance gurney replacements.
o Remaining budget for the local traffic emergency.
o Additional Police take home vehicle program costs.
o Police in car video systems.
o Police taser inventory replacement.
o Police services community survey.
o Sustainable Mobility Plan update with Vision Zero.
o Active Transportation Monitoring report.

The difference of $25.4 million be tween the final budgeted expe nditures plus transfers and the actual expenditures plus transfers for the year, on a budgetary basis, can be generally summarized as follows:

• $13.5 million in outstanding encumbrances as of June 30, 2023 that were carried forward to fiscal year 2023-24 • Unspent capital outlay budget for vehicles and equipment in the Police Department in the amount of $850,000. This amount was requested for City Council approval to be carried fo rward into fiscal year 2023-24 as part of the city’s carryforward process.
• U n s p e n t b u d g e t f o r t h e c i t y ’ s S a f e r S t r e e t s T o g e t h e r l o c a l s t a te of emergency in the amount of $560,000. This amount was requested for City Council approval to be carried fo rward into fiscal year 2023-24 as part of the city’s carryforward process.
• Savings by various major service areas within the city make up the remaining difference. Current year savings were generated from:
o The closure of purchase orders that had no activity during the past 12 months. o Unspent City Council contingency funds in the amount of $500,000. o Unfilled staff vacancies across the city.
o Overall awareness of fiscal responsibility throughout the city.

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Capital Asset and Debt Administration

Capital Assets

At the end of fiscal year 2022-23, the city had recorded invest ments of over $1.2 billion in a broad range of capital assets, including park facilities, land, buildings, roads, bridges, dra inage facilities, water and wastewater lines, Police and Fire vehicles, and other maintenance equipment. This number includes infrastructure assets of the general government which are required per GASB.

Some of this year’s major capital asset additions included:

• Fire Station No. 2
• Agua Hedionda Lift Station
• Carlsbad Recycled Water Facility Improvements
• Poinsettia Park Phase IV Improvements
• New Village Art’s Building Improvements
• Temporary Fire Station No. 7
• NW Storm Drain Improvements
• Water and sewer pipelines and traffic signal at Gateway Road
• License plate readers
• Golf Cart Fleet
• Lake Calavera Outlet Improvements
• ADA Ramp Improvements
• Villas Sewer Lift electric panel
• El Camino Real and Cannon Road Intersection
Improvements
• Pavement paint marking truck
• Ambulance vehicle
• Traffic signal at Tamarack Ave. and Valley St.
• IT server devices
• Computer aided dispatch system
• Dump truck
• Refurbishment of Safety Training Center
• Information technology network and service software

In addition to carrying forward appropriations of $251.5 million for previously budgeted projects, the city’s fiscal year 2022 - 23 capital improvement budget appropriated an additional $42.6 million for capital projects.

These additional appropriations were principally for the following projects: Intersection control at Camino De Los Coches and La Costa Avenue, La Costa Avenue Traffic Improvements, the city’s pavement management and concrete replacement programs, village decorative lighting projects, beach access repair and upgrades Pine to Tamarack, Calavera Hills Community Center refurbishments, Hosp Grove Park improvements, Faraday Av enue and El Camino Real Sewer replacement (Orion to Palomar Airport Road), Cannon Road sewer lift station improvemen t s , E n c i n a W a s t e w a t e r c a p i t a l p r o j e c t s , B a r r i o s t r e e t lighting projects, Avenida Encinas Coastal Rail Tral and pedest rian improvements, El Camino Real widening (Sunny Creek to Jackspar), SCADA improvements and water system rehabilitation and replacement program.

Total
Percentage
Change Change
2022 2023 2022 2023 2022 2023 2022-23 2022-23
Land $160.6 $159.7 $9.3 $9.4 $170.0 $169.1 ($0.8) -0.5% Construction in progress 36.9 33.7 17.4 14.3 54.3 48.0 (6.3) -11.6% Buildings and ot he r structure s 138.3 154.0 41.4 44.1 179.7 198.1 18.4 10.2% Improvements other than bui l di ngs 103.9 111.9 56.2 56.4 160.1 168.3 8.2 5.1% Machinery and equipment 56.3 60.4 14.0 14.2 70.3 74.6 4.3 6.1% Infrastructure 752.7 754.8 404.2 410.6 1,156.9 1,165.5 8.6 0.7% Waste wate r tre atme nt facility - - 64.4 69.0 64.4 69.0 4.6 7.2% Intangible s 6.5 11.5 - - 6.5 11.5 5.0 76.8% 1,255.1 1,286.1 606.9 617.9 1,862.0 1,904.0 42.0 2.3% Accumulated depreciation (446.6) (473.8) (239.0) (254.4) (685.6) (728.2) (42.7) 6.2% Total $808.5 $812.3 $367.9 $363.5 $1,176.5 $1,175.8 ($0.7) -0.1% Activities Activities Total

CITY OF CARLSBAD'S CAPITAL ASSETS
(in millions of dollars)
Governmental Business-Type
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These projects will be financed by development fees, infrastructure and replacement transfers from the General Fund, special district fees and taxes, water and wastewater replacement reser ves and other sources, including grants and contributions from other agencies. More detailed information about the city’s c a p i t a l a s s e t s i s p r e s e n t e d i n N o t e 6 o f t h e f i n a n c i a l s t a t e m e n t s a n d i n t h e c i t y ’ s C a p i t a l I m p r o v e m e n t P r o g r a m ( C I P ) document, which can be found on the city’s website or obtained from the Administrative Services Department.

Long-term Debt

At fiscal year-end, t he city had $11.0 million in loans and lea ses, a decrease of $1.4 million from last year, as shown in the table above. Regular payments were made on all the city’s outst anding loans and leases. More detail about the city’s long-term liabilities is presented in Note 12 of the financial statements.

The city implemented GASB Statement No. 96 for the fiscal year ended June 30, 2023. This statement improves financial reporting for subscription-based information technology arrange ments by requiring the city to report a subscription asset and subscription liability for these types of arrangements. The outstanding subscription liab ility can be found in the chart above. More information about these arrangements can be found in Note 11 of the financial statements.

Economic Factors and Next Year’s Budgets and Rates for Fiscal Year 2023-24

The Carlsbad economy is diverse, has strong industry clusters a nd is a leader in innovation. According to the most recent biennial business survey of Carlsbad businesses, released in January 2022, five key industry clusters are driving growth:

• Life sciences
• Information, communications and technologies
• Cleantech
• Sports innovation and design
• Hospitality and tourism
The gross regional product for Carlsbad is $15.8 billion, indic ating that Carlsbad is the largest economy in the county behind the City of San Diego. Companies that call Carlsbad home are at the forefront in areas of technology and innovation, and the city’s hospitality and tourism i ndustry generate the second-hig hest amount of transient occupancy tax among the county’s 18 cities.

In 2022, Carlsbad’s economy grew by roughly $1.07 billion, with a total gross regional product of $15.8 billion. Growth o c c u r r e d i n a l l s e c t o r s e x c e p t t h e m i n i n g a n d o i l a n d g a s e x t r action sector, which contracted slightly. Wholesale trade, manufacturing, professional, scientific and technical services, and hospitality and food service were the leading growth sectors for Carlsbad in 2022.

Through most of 2022, Carlsbad’s unemployment rate fluctuated b etween 2% and 3%. In January 2023, the unemployment rate jumped to 3.4% and ticked up to 3.5% in February and March . Macrotrends in the tech industry are pushing unemployment up nationally, but the labor market is still seen as being very tight. The unemployment rate in March was

4.8% at the state level and 3.7% at the county level.

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OTY OF CARlSBAD'S OUTSTANDING DEBT
Leases
Subscri ptions
Loans
Total
Governmental
Activities
2022 2023
S22,377 5238,385
1,845,563 2,928,584
0 0
Sl,867,940 S3,166,969
Business-Type
Activities
2022 2023
so so
0 0
12,443,537 10,792,169
$12,443,537 S10,792.169
Total
Percentage
Total Change
2022 2023 2022-23
S22,377 5238,385 965.3%
1,845,563 2,928,584 58.7%
12,443,537 10,792,169 -13.3%
$14,311,477 $13,959,138 -2.5%

In the first quarter, the financial industry was impacted by th e failure of Silicon Valley Bank (SVB). SVB was a major player in the entrepreneurship and startup ecosystem. The ripple effects of the SVB failure, and the subsequent failure of First Republic Bank, could have tumultuous impacts for San Diego and Carlsbad-based startups and entrepreneurs – a key focal point in the city’s Economic Development Strategic Plan. Combined with the c ontinued rise in interest rates, capital will be harder to access for some developing companies. This could stunt growth a nd potentially lead to downsizing. Some economists are predicting the United States is at or near the peak of inflation, although many predict continued interest rate hikes are likely.

With these pressures on the financial system, most economists a gree that a recession is looming, although the length and severity is debated.

The continued rise in interest rates is also impacting property values in Carlsbad. The median home price in Carlsbad fell $98,000 in the last quarter. Median home prices rose consistent ly in Carlsbad between March 2019 and July 2022 and have since been falling. The current m edian home price is $1,338,506 , which is roughly equivalent to the median home price in December 2021.

Commercial real estate was more resilient last quarter in Carlsbad, with rental rates continuing to rise in all categories, office, industrial and retail. However, commercial developers are largely holding off on building new developments and office space elsewhere in the region and the county is seeing a rise in vacancy and a drop in value, an indicator of instability.

The importance of monitoring economic trends at global as well as local levels becomes increasingly important as the city navigates these uncertain times. Below are budgetary expectatio ns and highlights from the fiscal year 2023-24 adopted budget.

Property tax, the largest source of General Fund revenues, is expected to grow by 3.4% over last year’s estimates. While the residential real estate market in Carlsbad has seen significant increases in values in recent years, the growth has begun to cool o ff. C ommercial pro per ty assessed va lues are expe cted to remain relatively flat as the increase in interest rates has created immense uncertainty in the sector. With the COVID-19 emergency officially ended, the focus on the housing market shifts to other economic factors. In response to the unprecedented inflationary increases experienced over the last year and a half, the Federal Reserve has responded by raising rates to a current range of 5.0-5.25%, the highest range since July 2006.

This has made home purchasing more difficult for borrowers. While demand remains relatively high both locally and around the state, these increases have certainly contributed to the median home value in Carlsbad falling to $1.3 million, roughly the same value as in December 2021. Proposition 8 allows owners to have their property temporarily revalued if market value is lower than the factored base year value, posing a risk that commercial property values could temporarily decrease.

Assessed values on the residential real estate side are expecte d to grow modestly, capped by California’s Proposition 13.

Adopted in 1978, Proposition 13 limits the annual increase in assessed values for property. Under this proposition, assessed values (and the related property tax) can grow by no more than 2% per year. The value upon which the tax is based is only increased to the full market value upon the sale of a property. The maximum increase of assessed values when properties are not sold is by the change in California’s Consumer Price In dex, which was 1.036% in fiscal year 2021-22 – below the 2% cap for the first time since 2016-17. In recent years, resident ial activity has been driven by l ow interest rates on mortgages, pent-up demand that built during the shutdown and an increase in the ability to work remotely. Now, increasing rates and diminishing pent-up demand as we move past the pandemic will likely have adverse impacts compared to prior periods. Based on resale data from Zillow, the median price of a single-family residence in Carlsbad is $1.3 million, up by 0.7% year over year in March 2023.

Sales Tax revenues generally move in step with economic conditi ons and overall, Carlsbad’s economy has absorbed the inflationary increases experienced over the past 12-18 months. The restrictions resulting from the COVID-19 pandemic led to increases in segments like auto sales, construction, drug store s a l e s , c h e m i c a l p r o d u c t s , f o o d m a r k e t s a n d r e c r e a t i o n a l products, while others like restaurants and general retail took a major hit. With the pandemic and its impacts mostly behind us, the uncertainty rests with continued levels of inflationary increase and whether the rise in interest rates will lower inflation levels adequately.
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Sales tax revenues improved markedly up until fiscal year 2019-20, peaking in fiscal year 2018-19 at $40.8 million. The onset of the pandemic in March 2020 resulted in swift reductions in sales tax revenues and the city ended the year with $38 million in sales tax revenues. During fiscal year 2020-21, sales tax le vels generally correlated with shelter-in-place mandates. As restrictions were lifted, the city’s sales tax levels recovered—the city ended fisc al year 2020-21 with $44 million in sales t ax revenues. Fiscal year 2021-22 experienced the most accelerated recovery, ending the year at a historic high of $51.2 million in sales tax revenues. The fiscal year 2022-23 sales tax estima tes reflected uncertainty surrounding market and economic conditions like inflation and impacts to disposable income. These inflationary increases have yet to adversely impact sales tax revenues through the first six months of the fiscal year and st aff anticipate another historic high of sales tax revenues.

However, this positive experience does not change the outlook. With continued levels of inflation and a risk of recession looming, staff have proposed a c onservative estimate of $51.1 million in budgeted revenue for fiscal year 2023-24 which represents a decrease of $0.3 million, or 1%, over fiscal year 2022-23 estimates.

The third highest General Fund revenue source is Transient Occu pancy Tax, also known as TOT or hotel tax. TOT was the revenue category most adversely impacted by COVID-19. From hist oric highs of $26 million in fiscal year 2018-19, the city experienced year-over-year decreases of 27% and 16%. Recovery from the pandemic was estimated conservatively; however, fiscal year 2021-22 proved other wise, reaching a historic high of $32.4 million driven by the ea sing of restrictions, pent-up demand and an increase in average daily room rates. This trend continued in fiscal year 2022-23, whereby actual revenues exceeded conservative estimates that were applied to account for sustained levels of unprecedented inflation. It is estimated that TOT revenues will once again reach a historic high this year.

According to a report from Tourism Economics, San Diego County tourism will see continued growth in visitation demand of around 9.8% in calendar year 2023. The projected increase is su pported by the thought that travel has, since the pandemic, been “reclassified” as a necessary expense rather than a discretionary one. Furthermore, the influx of financial aid and savings achieved throughout the pandemic may likely indicate that uncertainty in the economy can be mitigated by these additional funds. However, group business travel has yet to fully return t o pre-pandemic levels and uncertainty around rising inflation and diminishing pent up demand continue to drive a moderately c onservative estimate in fiscal year 2023-24. The City of Carlsbad currently has approximately 4,776 hotel rooms, 343 registered vacation rentals and over 660 timeshares.

Ambulance fee revenues are estimated to increase $3.3 million o ver last year’s estimates, from $3.9 million to $6.3 million.

This increase is due to the Fire Department’s addition of two medical transports. The increase is also driven by the Ground Emergency Medical Transportation Certified Public Expenditure Program, which helps cover uncompensated costs for Medi- Cal fee-for-service transports. The department submitted cost reports for fiscal year 2018-19 through 2022-23 and is expected to receive a one-time reimbursement of $666,000. Furthermore, t he department will participate in the Public Provider Ground Emergency Medical Transpor t Intergovernmental Transfer P rogram which will provide add-on reimbursement payments to help cover uncompensated costs in the future. This will generate approximately $883,000 in additional revenue annually. Lastly, the Fire Department recently completed an amb ulance fee study and is proposing to increase the fees to better align cost recovery levels in comparison with jurisdictions in the region. The additional revenue will amount to approximately $2 million annually.

The City Council approved 2 new Personnel or full-time positions in the General Fund which were offset by a reduction of one full-time position and several part-time positions in the Gener al Fund (net decrease of 12.06 full-time equivalent positions).

The staffing changes in t
he General Fund included:
o Library & Cultural Arts added 1.0 Production Technician and 1.0 Senior Librarian in Adult & Teen Services. The addition of these two full-time positions is offset and funded by the reduction of part-time staff equal to 5.55 full-time equivalent positions, resulting in ongoing savings to the General Fund of approximately $100,000. o The Fire Department added 1.0 Senior Office Specialist. The addition of this full-time position is offset and funded by the reduction of two part-time positions. In conjunction with addit ional changes made during fiscal year 2022-23, a cost neutral fiscal impact was achieved.
o Community Services Administration eliminated a full-time administrative position as part of departmental reorganization efforts within the branch.
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As part of CalPERS’ strategy to ensure the plan’s sustainability, and as a result of their investment performance in fiscal year 2020-21, CalPERS reduced its discount rate from 7.0% to 6.8% wh ich increases the amount the city is required to contribute on an annual basis. In support of CalPERS strategies for plan s ustainability, and as part of the city’s strategic, long-term approach to financial management , the city actively manages its unfunded pension liability. T he City Council approved an additional discretionary contribution of $6.4 million to decrease future costs of the city’s unfunded actuarial liability. In fiscal year 2021-22, CalPERS experienced a 6.1% investment loss which nearly negated the positive performance from the previous year. The city expects its required contributions to increase significantly once this investment loss from fiscal year 2021-22 is factored into CalPERS’ actuarial valuation reports in fiscal ye ar 2024-25. During fiscal year 2023-24, the city established a Section 115 Pension Trust for purposes of mitigating CalPERS’ v olatility, maintaining local c ontrol over city assets, and preparing for potential future d ecreases in CalPERS’ discount r ate. An initial contribution of $10 million was authorized by the City Council and made to the trust. On an annual basis, the city will evaluate the plan’s fu nded status in respect to City Council Policy No. 86 as well as potential changes in CalPERS’ assumptions to determine the appropriateness of further contributions to the trust. This active management helps ensure r e s o u r c e s a r e a v a i l a b l e t o f u l f i l l t h e c i t y ’ s c o n t r a c t u a l promises to its employees and minimizes the chance that funding these pension benefits will interfere with the city’s ability to provide essential public services.

These factors were considered when preparing the city’s General Fund budget for fiscal year 2023-24. Budgeted expenditures increased by 9.3% to $216.9 million. The total personnel budget for fiscal year 2023-24 is $130.1 million, which is 4.8% more than the previous year’s personnel budget of $124.1 million. Th e total maintenance and operations budget for fiscal year 2023-24 is $64.8 million, which i s 9.5% higher than the previou s year’s budget of $59.2 million and reflects the one-time $5.2 million appropriat ion for the Village Trenching project. T he total capital outlay budget for fiscal year 2023-24 is $0.1 million, $1.4 million less than the previous year.

Transfers out of the General Fund are budgeted at $21.9 million , an $8.3 million increase from the prior fiscal year. This increase resulted from a one-time use of projected budget surplus of $7.4 million to further fund capital projects.

The city’s business-type activities reflect the following:

Water revenues are expected to increase from rate increase star ting January 2024, which may be offset by a reduction in volume from statewide water conservation efforts.

The effective increase in purchase costs for CMWD is projected to be approximately 7%. The cost of water purchased from the San Diego County Water Authority is projected to increase due to increases in Metropolitan Water District’s water rates.

A recent cost of service study set rate increases beginning in January 2025 with increases based on purchase rates, capital repair costs and maintaining adequate reserves.

W a s t e w a t e r r a t e s i n c r e a s e d 2 0 % b e g i n n i n g i n J a n u a r y 2 0 2 4 w i t h planned increases based on a recent cost study. The increases are needed t o invest in maintaining wastewater infras tructure that has reached the end of its expected life and increases in cost of materials and supplies needed to operate systems.

S o l i d W a s t e r e v e n u e s a r e p r o j e c t e d t o s l i g h t l y d e c r e a s e , a n d t he fund expects to run a deficit due to increasing waste management requirements imposed by the state. Sufficient reserv es are expected to sustain the increased costs without significant revenue increases in the short term.

The Golf Course Fund projected a slight increase in revenues fr om an increase in rates in July 2023 further driven continued demand and a return of private events. As a result, the operati on expected to continue to see improvements in their cash flows going forward.

Contacting the City’s Financial Management

This financial report is designe d to provide the City of Carlsbad’s residents, taxpayers, customers, investors, and creditors with a general overview of the city’s finances and to demonstrate the city’s accountability for the money it receives. If you have any questions about this report or need additional information, contact the Finance Department, 1635 Faraday Avenue, Carlsbad, CA 92008, 442-339-2430, or find additional information at www.carlsbadca.gov. 24 April 16, 2024
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Basic Financial Statements

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Government-Wide
Financial Statements

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CITY OF CARLSBAD
Statement of Net Position
Governmental Business-Type
Activities Activities Total
ASSETS
Cash and investments 623,710,662$ 194,883,503$ 818,594,165$ Receivables:

Accounts 454,301 10,977,267 11,431,568 Taxes 16,965,470 52,546 17,018,016 Notes and loans 27,713,432 - 27,713,432 Accrued interest 6,473,922 846,570 7,320,492 Leases 12,183,616 4,990,120 17,173,736
Other 1,424,636 537,496 1,962,132
Internal balances (2,522,868) 2,522,868 - Prepaid costs 2,035,022 108,503 2,143,525 Deposits 200,432 - 200,432 Due from other governments 1,651,419 3,999,983 5,651,402 Inventories 251,781 1,627,479 1,879,260 Land held for resale 442,800 - 442,800 Capital assets not being depreciated 193,464,148 23,662,906 217,127,054 Capital assets, net of depreciation 618,785,860 339,881,068 958,666,928 Total assets 1,503,234,633 584,090,309 2,087,324,942

DEFERRED OUTFLOWS OF RESOURCES
Pension-related 81,599,021 5,909,550 87,508,571 OPEB-related 3,829,200 654,350 4,483,550 Total deferred outflows of resources 85,428,221 6,563,900 91,992,121

LIABILITIES
Accrued liabilities 19,857,740 3,987,267 23,845,007 Accrued interest 34,513 29,325 63,838 Unearned revenue 1,303,685 149,976 1,453,661 Deposits payable 9,244,647 1,147,733 10,392,380 Due to other governments 116,266 7,338,482 7,454,748 Noncurrent liabilities:

Due within one year: loans, leases, subscriptions,
and claims 15,418,502 1,738,405 17,156,907 Due in more than one year:

Loans, leases, subscriptions, and claims 16,307,600 9,053,764 25,361,364 Net pension liability 184,927,240 13,600,231 198,527,471 Net OPEB liability 2,629,936 338,604 2,968,540 Total liabilities 249,840,129 37,383,787 287,223,916

DEFERRED INFLOWS OF RESOURCES
Pension-related 1,110,710 176,912 1,287,622 OPEB-related 761,572 134,434 896,006 Lease-related 11,850,946 4,836,833 16,687,779 Total deferred inflows of resources 13,723,228 5,148,179 18,871,407

NET POSITION
Net investment in capital assets 809,083,039 352,493,976 1,161,577,015 Restricted:

Affordable housing 41,800,556 - 41,800,556 Community services 3,599,267 - 3,599,267 Lighting and landscape districts 9,897,059 - 9,897,059 General government 701,325 - 701,325 Public safety 602,264 - 602,264 Capital projects 192,629,411 38,437,080 231,066,491 Unrestricted 266,786,576 157,191,187 423,977,763 Total net position 1,325,099,497$ 548,122,243$ 1,873,221,740$ June 30, 2023
Primary Government
See accompanying notes to financial statements.
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CITY OF CARLSBAD
Statement of Activities
Year Ended June 30, 2023
Operating Capital
Charges for Contributions Contributions
Expenses Services and Grants and Grants
Functions/Programs:

Primary government:

Governmental activities:

General government 22,767,518$ 633,721$ 1,602,768$ 284,652$ Public safety 99,483,879 6,504,817 1,576,440 - Community services 76,373,519 9,423,350 10,624,775 171,020 Public works 54,124,139 3,505,432 255,732 12,511,475 Interest on long-term debt 22,365 - - - Total governmental activities 252,771,420 20,067,320 14,059,715 12,967,147 Business-type activities:

Carlsbad Municipal Water District 54,178,068 46,101,707 - 3,427,569 Golf course 12,198,021 10,966,531 - - Wastewater 20,193,986 19,616,466 - 1,761,415 Solid waste 5,405,204 2,245,025 209,448 - Total business-type activities 91,975,279 78,929,729 209,448 5,188,984 Total primary government 344,746,699$ 98,997,049$ 14,269,163$ 18,156,131$ General revenues and transfers
General revenues:

Taxes:

Property taxes, levied for general purpose
Transient occupancy taxes
Sales taxes
Franchise taxes
Real property transfer taxes
Business license taxes
Use of money and property
Other
Gain on sale of capital asset
Transfers
Total general revenues and transfers
Change in net position
Net position-beginning
Net position-ending
Program Revenues
See accompanying notes to financial statements.
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Primary Government
Governmental Business-Type
Activities Activities Total
(20,246,377)$ -$ (20,246,377)$ (91,402,622) - (91,402,622) (56,154,374) - (56,154,374) (37,851,500) - (37,851,500) (22,365) - (22,365) (205,677,238) - (205,677,238) - (4,648,792) (4,648,792) - (1,231,490) (1,231,490) - 1,183,895 1,183,895
- (2,950,731) (2,950,731) - (7,647,118) (7,647,118) (205,677,238) (7,647,118) (213,324,356)
88,196,125 5,129,819 93,325,944
34,280,239 - 34,280,239
56,186,707 - 56,186,707
7,833,845 - 7,833,845
1,367,481 - 1,367,481
6,356,809 - 6,356,809
10,988,049 2,579,136 13,567,185
3,969,327 1,526,467 5,495,794
513,445 - 513,445
(332,000) 332,000 -
209,360,027 9,567,422 218,927,449
3,682,789 1,920,304 5,603,093
1,321,416,708 546,201,939 1,867,618,647
1,325,099,497$ 548,122,243$ 1,873,221,740$
Net (Expenses) Revenues and
Changes in Net Position
See accompanying notes to financial statements.
27 April 16, 2024
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Fund Financial Statements

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CITY OF CARLSBAD
Balance Sheet
Governmental Funds
June 30, 2023
General
ASSETS
Cash and investments 177,207,987$ 94,606,892$ 111,637,918$ 14,611,756$ Receivables (net of allowance for uncollectible):

Accounts 441,582 - - - Taxes 16,959,620 5,850 - - Accrued interest 822,759 412,464 482,867 63,200 Due from other governments 167,852 - - - Notes and loans 381,635 - - - Leases 7,883,689 1,276,727 - - Other 1,245,116 - - - Due from other funds - - - - Deposits 200,432 - - - Inventories 12,110 - - - Prepaid costs 36,973 - - - Land held for resale - - - - Advances to other funds 1,167,725 901,024 - - Total assets 206,527,480$ 97,202,957$ 112,120,785$ 14,674,956$

LIABILITIES
Accrued liabilities 6,264,215$ 237,929$ 863,570$ 96,439$ Due to other governments - - - - Deposits payable 8,723,996 13,000 - - Due to other funds - - - - Advances from other funds - - - 5,650,000 Unearned revenues 958,777 - - - Total liabilities 15,946,988 250,929 863,570 5,746,439

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 94,408 - - - Lease-related 7,636,838 1,221,360 - - Total deferred inflows of resources 7,731,246 1,221,360 - -

FUND BALANCES
Nonspendable 1,798,875 - - - Restricted - 95,730,668 - 8,928,517 Committed 1,000,000 - - - Assigned 43,209,995 - 111,257,215 - Unassigned 136,840,376 - - - Total fund balances 182,849,246 95,730,668 111,257,215 8,928,517 Total liabilities, deferred inflows of
resources, and fund balances 206,527,480$ 97,202,957$ 112,120,785$ 14,674,956$ Community
Facilities
District #1
Infrastructure
Replacement
Fund
Park
Development
Capital Projects Funds
See accompanying notes to financial statements.
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CITY OF CARLSBAD
Balance Sheet
Governmental Funds
June 30, 2023
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Taxes
Accrued interest
Due from other governments
Notes and loans
Leases
Other
Due from other funds
Deposits
Inventories
Prepaid costs
Land held for resale
Advances to other funds
Total assets

LIABILITIES
Accrued liabilities
Due to other governments
Deposits payable
Due to other funds
Advances from other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows of
resources, and fund balances
Total Total
Nonmajor Governmental
Funds Funds
162,650,801$ 560,715,354$
8,307 449,889
- 16,965,470
4,447,836 6,229,126
1,483,567 1,651,419
27,331,797 27,713,432
3,023,200 12,183,616
179,520 1,424,636
24,002 24,002
- 200,432
3,814 15,924
378,021 414,994
442,800 442,800
5,650,000 7,718,749
205,623,665$ 636,149,843$
3,591,394$ 11,053,547$
116,266 116,266
505,559 9,242,555
24,002 24,002
2,068,749 7,718,749
344,908 1,303,685
6,650,878 29,458,804
4,015,323 4,109,731
2,992,748 11,850,946
7,008,071 15,960,677
378,021 2,176,896
144,570,697 249,229,882
- 1,000,000
47,030,612 201,497,822
(14,614) 136,825,762
191,964,716 590,730,362
205,623,665$ 636,149,843$
Capital Projects Funds
See accompanying notes to financial statements.
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Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position
June 30, 2023
Amounts reported for governmental activities in the Statement of Net Position are different because:

Total fund balances - governmental funds 590,730,362$
787,953,919
Deferred outflows-pension related 78,257,161
Deferred outflows-OPEB related 3,590,991
Deferred inflows-pension related (1,010,666)
Deferred inflows-OPEB related (725,273)
Total deferred outflows and inflows related to postemployment benefits 80,112,213 Long-term receivables 3,682,496
Miscellaneous revenues 427,235
Total other long-term assets 4,109,731
42,077,480
Leases payable (238,385)
Net pension liability (177,236,282)
Net OPEB liability (2,409,541)
Total long-term liabilities (179,884,208)
Net position of governmental activities 1,325,099,497$

CITY OF CARLSBAD
Capital assets, net of accumulated depreciation/amortization, used in governmental activities are not financial resources and, therefore, are not reported in the funds Differences between expected and actual experiences, assumption changes and net differences between projected and actual earnings, and contributions subsequent to the measurement date for the postretirement benefits (pension and OPEB) are recognized as deferred outflows of resources and deferred inflows of resources on the Statement of Net Position.

Other long-term assets that are not available to pay for current period expenditures and, therefore, are either labeled unavailable or not reported in the funds.

Internal service funds are used by management charge the cost of fleet management, self-insurance, information technology, risk management, and workers' compensation to individual funds. The assets, deferred outflows of resources, liabilities, and deferred inflows of resources of the internal service funds are included in governmental activities in the Statement of Activities.

Long-term liabilities that are not due and payable in the current period, and therefore, are not reported in the funds.

See accompanying notes to financial statements.
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CITY OF CARLSBAD
Statement of Revenues, Expenditures, and
Changes in Fund Balances
Governmental Funds
For the Year Ended June 30, 2023
General

REVENUES
Taxes 193,235,077$ 986,129$ -$ -$ Licenses and permits 3,710,466 - - - Intergovernmental 2,456,236 - - - Contribution from property owners - 740,042 - 549,031 Charges for services 10,833,054 - - - Use of money and property 7,069,605 1,143,702 1,403,303 135,814 Fines and forfeitures 390,400 - - - Contributions 20,233 - - - Miscellaneous 1,907,690 - 27,177 - Total revenues 219,622,761 2,869,873 1,430,480 684,845

EXPENDITURES
Current:

General government 22,975,577 50,005 - - Less: interdepartmental charges (5,991,590) - - - Public safety 85,437,538 - - - Community services 48,705,129 - - - Public works 22,265,076 - - - Capital outlay 1,336,186 912,722 7,293,771 189,929 Debt service:

Interest and fiscal charges - - - - Total expenditures 174,727,916 962,727 7,293,771 189,929 Excess (deficiency) of revenues
over (under) expenditures 44,894,845 1,907,146 (5,863,291) 494,916

OTHER FINANCING SOURCES (USES)
Transfers in - - 3,956,000 - Transfers out (24,208,252) - - - Proceeds from sale of capital asset 24,042 - - - Total other financing sources (uses) (24,184,210) - 3,956,000 - Net change in fund balances 20,710,635 1,907,146 (1,907,291) 494,916 Fund balances-beginning, restated 162,138,611 93,823,522 113,164,506 8,433,601 Fund balances-ending 182,849,246$ 95,730,668$ 111,257,215$ 8,928,517$ Park
Development
Community
Facilities
District #1
Infrastructure
Replacement
Fund
Capital Projects Funds
See accompanying notes to financial statements.
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CITY OF CARLSBAD
Statement of Revenues, Expenditures, and
Changes in Fund Balances
Governmental Funds
For the Year Ended June 30, 2023

REVENUES
Taxes
Licenses and permits
Intergovernmental
Contribution from property owners
Charges for services
Use of money and property
Fines and forfeitures
Contributions
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Less: interdepartmental charges
Public safety
Community services
Public works
Capital outlay
Debt service:

Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues
over (under) expenditures

OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Proceeds from sale of capital asset
Total other financing sources (uses)
Net change in fund balances
Fund balances-beginning, restated
Fund balances-ending
Total Total
Nonmajor Governmental
Funds Funds
5,520,836$ 199,742,042$
- 3,710,466
14,267,654 16,723,890
3,625,934 4,915,007
4,329,462 15,162,516
1,313,146 11,065,570
- 390,400
293,624 313,857
2,034,460 3,969,327
31,385,116 255,993,075
402,241 23,427,823
- (5,991,590)
402,883 85,840,421
16,797,621 65,502,750
3,071,794 25,336,870
25,845,641 35,578,249
22,365 22,365
46,542,545 229,716,888
(15,157,429) 26,276,187
9,472,000 13,428,000
(160,000) (24,368,252)
355,302 379,344
9,667,302 (10,560,908)
(5,490,127) 15,715,279
197,454,843 575,015,083
191,964,716$ 590,730,362$
Capital Projects Funds
See accompanying notes to financial statements.
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Reconciliation of the Statement of Revenues, Expenses and Changes in Fund Balances of Governmental Funds to the Statement of Activities For the Year Ended June 30, 2023
Amounts reported for governmental activities in the Statement of Activities are different because:

Net change in fund balances - total governmental funds 15,715,279$ Capital outlay 24,900,772
Donations of capital assets 134,101
Loss/(gain) on disposal of capital assets (1,949,808)
Depreciation/amortization expense (22,844,721)
Total adjustment 240,344
Earned but unavailable tax revenues (89,316)
Earned but unavailable grant revenues (196,269)
Earned but unavailable other revenues (651,763)
Total adjustment (937,348)
Leases issued 238,606
Principal payments (22,598)
Total adjustment 216,008
(2,698,675)
Changes in pension liabilities and related deferrals (8,811,295) Changes in OPEB liabilities and related deferrals (41,524) Total adjustment (8,852,819)
Change in net position of governmental activities 3,682,789$ 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

CITY OF CARLSBAD
Governmental funds report capital outlays are expenditures. However, in the Statement of Activities, the cost of these assets is allocated over their estimated useful lives and reported as depreciation/amortization expense. This is the amount by which capital outlays exceeded depreciation/amortization expense in the current period.

Revenues in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds.

Bond and other debt proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the Statement of Net Position.

Repayment of bond and other debt principal is an expenditure in the governmental funds, but repayment reduces long-term liabilities in the Statement of Net Position.

Also, governmental funds report the effect of premiums, discounts, and similar items when debt is first issued, whereas these amounts are deferred and amortized in the Statement of Activities.

The internal service funds are used by management to charge the costs of fleet management, self-insurance, information technology, risk management, and workers' compensation to individual funds. The net revenue of certain activities of internal service funds is reported with governmental activities.

See accompanying notes to financial statements.
35 April 16, 2024
Item #2 Page 79 of 244

CITY OF CARLSBAD
Statement of Net Position
Proprietary Funds
June 30, 2023
Other
Enterprise
Funds
ASSETS
Current:

Cash and investments 135,103,762$ 42,952,020$ 16,827,721$ Receivables:

Accounts, net of allowances 7,505,963 3,465,237 6,067 Taxes 52,546 - -
Accrued interest 590,743 185,768 70,059 Lease 176,397 - 58,461 Other - - 537,496 Prepaid costs 15,433 - 93,070 Due from other governments 2,870,359 1,129,624 - Inventories 1,411,886 15,607 199,986 Total current assets 147,727,089 47,748,256 17,792,860 Noncurrent:

Lease receivable 3,513,043 - 1,242,219 Capital assets, net 201,877,232 140,336,677 21,330,065 Total noncurrent assets 205,390,275 140,336,677 22,572,284 Total assets 353,117,364 188,084,933 40,365,144

DEFERRED OUTFLOWS OF RESOURCES
Pension-related 3,522,504 1,552,655 834,391 OPEB-related 453,877 114,773 85,700 Total deferred outflows of resources 3,976,381 1,667,428 920,091

LIABILITIES
Current:

Accrued liabilities 2,054,455 1,091,999 840,813 Accrued interest 29,325 - - Due to other governments 7,001,084 337,398 - Unearned revenues - 10,000 139,976 Deposits payable 107,289 168,646 871,798 Loans and subscriptions 1,738,405 - - Claims and judgments - - - Total current liabilities 10,930,558 1,608,043 1,852,587 Noncurrent:

Accrued claims and judgments - - - Loans and subscriptions 9,053,764 - - Net pension liability 8,106,689 3,573,277 1,920,265 Net OPEB liability 202,879 61,854 73,871 Total Noncurrent Liabilities 17,363,332 3,635,131 1,994,136 Total liabilities 28,293,890 5,243,174 3,846,723 Business-Type Activities - Enterprise Funds
Carlsbad
Municipal
Water District Wastewater
See accompanying notes to financial statements.
36 April 16, 2024
Item #2 Page 80 of 244

CITY OF CARLSBAD
Statement of Net Position
Proprietary Funds
June 30, 2023
Other
Enterprise
Funds
Business-Type Activities - Enterprise Funds
Carlsbad
Municipal
Water District Wastewater

DEFERRED INFLOWS OF RESOURCES
Pension-related 105,452 46,481 24,979 OPEB-related 93,735 25,553 15,146 Lease-related 3,579,091 - 1,257,742 Total deferred inflows of resources 3,778,278 72,034 1,297,867

NET POSITION
Net investment in capital assets 191,018,397 140,145,514 21,330,065 Restricted for capital projects 35,621,275 2,815,805 - Unrestricted 98,381,905 41,475,834 14,810,580 Total net position 325,021,577$ 184,437,153$ 36,140,645$ Adjustment to report the cumulative internal balance for the net effect of the activity between the internal service funds and the enterprise funds over time Net position of business-type activities
See accompanying notes to financial statements.
37 April 16, 2024
Item #2 Page 81 of 244

CITY OF CARLSBAD
Statement of Net Position
Proprietary Funds
June 30, 2023
ASSETS
Current:

Cash and investments
Receivables:

Accounts, net of allowances
Taxes
Accrued interest
Lease
Other
Prepaid costs
Due from other governments
Inventories
Total current assets
Noncurrent:

Lease receivable
Capital assets, net
Total noncurrent assets
Total assets

DEFERRED OUTFLOWS OF RESOURCES
Pension-related
OPEB-related
Total deferred outflows of resources

LIABILITIES
Current:

Accrued liabilities
Accrued interest
Due to other governments
Unearned revenues
Deposits payable
Loans and subscriptions
Claims and judgments
Total current liabilities
Noncurrent:

Accrued claims and judgments
Loans and subscriptions
Net pension liability
Net OPEB liability
Total Noncurrent Liabilities
Total liabilities
Governmental
Activities-
Internal
Totals Service Funds
194,883,503$ 62,995,308$
10,977,267 4,412
52,546 -
846,570 244,796
234,858 -
537,496 -
108,503 1,620,028
3,999,983 -
1,627,479 235,857
213,268,205 65,100,401
4,755,262 -
363,543,974 24,296,089
368,299,236 24,296,089
581,567,441 89,396,490
5,909,550 3,341,860
654,350 238,209
6,563,900 3,580,069
3,987,267 8,804,193
29,325 34,513
7,338,482 -
149,976 -
1,147,733 1,000
1,738,405 1,568,813
- 13,822,294
14,391,188 24,230,813
- 14,736,839
9,053,764 1,359,771
13,600,231 7,690,958
338,604 220,395
22,992,599 24,007,963
37,383,787 48,238,776
See accompanying notes to financial statements.
38 April 16, 2024
Item #2 Page 82 of 244

CITY OF CARLSBAD
Statement of Net Position
Proprietary Funds
June 30, 2023

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

NET POSITION
Net investment in capital assets
Restricted for capital projects
Unrestricted
Total net position
Adjustment to report the cumulative internal balance for the net effect of the activity between the internal service funds and the enterprise funds over time Net position of business-type activities
Governmental
Activities-
Internal
Totals Service Funds
176,912 100,044
134,434 36,299
4,836,833 -
5,148,179 136,343
352,751,805 21,367,505
38,437,080 -
154,410,490 23,233,935
545,599,375 44,601,440$
2,522,868
548,122,243$
See accompanying notes to financial statements.
39 April 16, 2024
Item #2 Page 83 of 244

CITY OF CARLSBAD
Statement of Revenues, Expenses, and
Changes in Net Position
Proprietary Funds
Year Ended June 30, 2023
Other
Enterprise
Funds

OPERATING REVENUES
Sales and service charges 45,370,836$ -$ -$ Wastewater service charges - 19,616,466 - Golf course operations - - 10,966,531 Other charges for services 730,871 - 2,245,025 Miscellaneous 772,617 187,320 581,554 Total operating revenues 46,874,324 19,803,786 13,793,110

OPERATING EXPENSES
Administration and general 18,359,435 6,719,812 5,663,331 Encina plant operations 1,341,433 4,760,559 - Purchased water 28,357,952 - - Golf course operations - - 8,744,007 Depreciation/amortization 6,375,383 8,914,919 3,405,438 Claims and premiums - - - Fuel and supplies - - - Small equipment purchases - - - Total operating expenses 54,434,203 20,395,290 17,812,776 Operating income (loss) (7,559,879) (591,504) (4,019,666)

NONOPERATING REVENUES (EXPENSES)
Taxes 5,129,819 - -
Intergovernmental - - 209,448 Interest expense (217,551) - - Investment income (loss) 1,899,379 400,096 264,637 Gain (loss) on disposal of capital assets - - (13,851) Total nonoperating revenues (expenses) 6,811,647 400,096 460,234 Income (loss) before transfer and
capital contributions (748,232) (191,408) (3,559,432) Transfers in - - 332,000 Capital contibutions:

Capital restricted fees and grants 2,111,538 1,136,698 - Developer constructed assets 1,316,031 624,717 - Donated capital assets - - - Change in net position 2,679,337 1,570,007 (3,227,432) Net position-beginning 322,342,240 182,867,146 39,368,077 Net position-ending 325,021,577$ 184,437,153$ 36,140,645$ Business-Type Activities - Enterprise Funds
Carlsbad
Municipal
Water District Wastewater
See accompanying notes to financial statements.
40 April 16, 2024
Item #2 Page 84 of 244

CITY OF CARLSBAD
Statement of Revenues, Expenses, and
Changes in Net Position
Proprietary Funds
Year Ended June 30, 2023

OPERATING REVENUES
Sales and service charges
Wastewater service charges
Golf course operations
Other charges for services
Miscellaneous
Total operating revenues

OPERATING EXPENSES
Administration and general
Encina plant operations
Purchased water
Golf course operations
Depreciation/amortization
Claims and premiums
Fuel and supplies
Small equipment purchases
Total operating expenses
Operating income (loss)

NONOPERATING REVENUES (EXPENSES)
Taxes
Intergovernmental
Interest expense
Investment income (loss)
Gain (loss) on disposal of capital assets
Total nonoperating revenues (expenses)
Income (loss) before transfer and
capital contributions
Transfers in
Capital contibutions:

Capital restricted fees and grants
Developer constructed assets
Donated capital assets
Change in net position
Net position-beginning
Net position-ending
Governmental
Activities-
Internal
Totals Service Funds
45,370,836$ -$
19,616,466 -
10,966,531 -
2,975,896 32,280,508
1,541,491 581,665
80,471,220 32,862,173
30,742,578 16,640,507
6,101,992 -
28,357,952 -
8,744,007 -
18,695,740 5,030,460
- 22,565,654
- 1,839,305
- 544,828
92,642,269 46,620,754
(12,171,049) (13,758,581)
5,129,819 -
209,448 -
(217,551) (77,521)
2,564,112 32,957
(13,851) 51,645
7,671,977 7,081
(4,499,072) (13,751,500)
332,000 10,608,252
3,248,236 -
1,940,748 -
- 1,344,057
1,021,912 (1,799,191)
544,577,463 46,400,631
545,599,375$ 44,601,440$
Adjustment for the net effect of the current year activity between the internal service funds and the enterprise funds 898,392 Changes in net position of business-type activities 1,920,304$ See accompanying notes to financial statements.
41 April 16, 2024
Item #2 Page 85 of 244

CITY OF CARLSBAD
Statement of Cash Flows
Proprietary Funds
Year Ended June 30, 2023
Other
Enterprise
Funds

CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers and users 47,489,228$ 18,628,306$ 14,155,273$ Cash received from interfund service provided - - - Cash paid to suppliers for goods and services (30,419,102) (9,320,597) (5,579,847) Cash paid to employees for services (18,088,696) (2,673,404) (9,481,125) Claims and premiums paid - - - Cash received from (payments to) others 772,617 187,320 581,554 Net cash provided by (used for) operating activities (245,953) 6,821,625 (324,145)

CASH FLOWS FROM NONCAPITAL

FINANCING ACTIVITIES
Cash transfers in - - 332,000 Cash transfers out - - - Property taxes 5,115,393 - - Net cash provided by (used for) capital
and related financing activities 5,115,393 - 332,000

CASH FLOWS FROM CAPITAL AND

RELATED FINANCING ACTIVITIES
Proceeds from capital debt 46,778 - - Capital contributions - 1,137,649 - Acquisition and construction of capital assets (5,217,359) (7,509,390) (1,054,158) Principal paid on capital debt (1,698,146) - - Interest paid on capital debt (225,112) - - Capital grants 301,992 - 209,448 Proceeds from sales of capital assets 1,316,532 332,686 20,482 Net cash provided by (used for) capital
and related financing activities (5,475,315) (6,039,055) (824,228)

CASH FLOWS FROM INVESTING ACTIVITIES
Cash received from leasing activities 320,643 - 81,583 Investment earnings 2,329,045 634,491 246,376 Net cash provided by (used for) investing activities 2,649,688 634,491 327,959 Net increase (decrease) in cash and cash equivalents 2,043,813 1,417,061 (488,414) Cash and Cash Equivalents at Beginning of Year 133,925,207 41,795,736 17,423,853 Adjustment: unrealized gain (loss) on investments (865,258) (260,777) (107,718) Cash and Cash Equivalents at End of Year 135,103,762$ 42,952,020$ 16,827,721$ Business-Type Activities - Enterprise Funds
Carlsbad
Municipal
Water District Wastewater
See accompanying notes to financial statements.
42 April 16, 2024
Item #2 Page 86 of 244

CITY OF CARLSBAD
Statement of Cash Flows
Proprietary Funds
Year Ended June 30, 2023
Other
Enterprise
Funds
Business-Type Activities - Enterprise Funds
Carlsbad
Municipal
Water District Wastewater

RECONCILIATION OF OPERATING INCOME (LOSS)

TO NET CASH PROVIDED BY (USED FOR)

OPERATING ACTIVITIES
Operating income (loss) (7,559,879)$ (591,504)$ (4,019,666)$ Adjustments to reconcile operating income (loss)
to net cash provided by (used for) operating activities:

Depreciation/amortization 6,375,383 8,914,919 3,405,438 (Increase) decrease in accounts receivable 1,372,491 (399,786) 1,124,122 (Increase) decrease in inventories (664,408) 1,759 (23,867) (Increase) decrease in due from other governments - (487,224) - (Increase) decrease in prepaid expense 39,233 - (9,569) Increase (decrease) in accrued liabilities 503,799 87,584 (937,564) Increase (decrease) in due to other governments (598,341) (721,983) - Increase (decrease) in deposits payable 15,030 (101,150) 144,410 Increase (decrease) in unearned revenue - - (70,694) Increase (decrease) in OPEB liability (199,428) (1,007,407) (498,707) Increase (decrease) in pension liability 470,167 1,126,417 561,952 Increase (decrease) in claims and judgments - - - Total adjustments 7,313,926 7,413,129 3,695,521 Net cash provided by (used for) operating activities (245,953)$ 6,821,625$ (324,145)$

SCHEDULE OF NON-CASH ACTIVITIES
Donated capital assets 1,316,031$ 623,766$ -$ Capital assets purchased on account 66,666 191,163 -
Unrealized gain (loss) on investments (865,258) (260,777) (107,718) Amortization of deferred inflows related to leases (223,151) - (77,243) See accompanying notes to financial statements.
43 April 16, 2024
Item #2 Page 87 of 244

CITY OF CARLSBAD
Statement of Cash Flows
Proprietary Funds
Year Ended June 30, 2023

CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers and users
Cash received from interfund service provided
Cash paid to suppliers for goods and services
Cash paid to employees for services
Claims and premiums paid
Cash received from (payments to) others
Net cash provided by (used for) operating activities

CASH FLOWS FROM NONCAPITAL

FINANCING ACTIVITIES
Cash transfers in
Cash transfers out
Property taxes
Net cash provided by (used for) capital
and related financing activities

CASH FLOWS FROM CAPITAL AND

RELATED FINANCING ACTIVITIES
Proceeds from capital debt
Capital contributions
Acquisition and construction of capital assets
Principal paid on capital debt
Interest paid on capital debt
Capital grants
Proceeds from sales of capital assets
Net cash provided by (used for) capital
and related financing activities

CASH FLOWS FROM INVESTING ACTIVITIES
Cash received from leasing activities
Investment earnings
Net cash provided by (used for) investing activities
Net increase (decrease) in cash and cash equivalents
Cash and Cash Equivalents at Beginning of Year
Adjustment: unrealized gain (loss) on investments
Cash and Cash Equivalents at End of Year
Governmental
Activities-
Internal
Totals Service Funds
80,272,807$ -$
- 32,801,776
(45,319,546) (1,990,410)
(30,243,225) (15,171,586)
- (10,916,336)
1,541,491 581,665
6,251,527 5,305,109
332,000 -
- 10,608,252
5,115,393 -
5,447,393 10,608,252
46,778 -
1,137,649 -
(13,780,907) (1,872,125)
(1,698,146) (1,925,993)
(225,112) (43,008)
511,440 -
1,669,700 51,645
(12,338,598) (3,789,481)
402,226 -
3,209,912 841,215
3,612,138 841,215
2,972,460 12,965,095
193,144,796 50,911,503
(1,233,753) (881,290)
194,883,503$ 62,995,308$
See accompanying notes to financial statements.
44 April 16, 2024
Item #2 Page 88 of 244

CITY OF CARLSBAD
Statement of Cash Flows
Proprietary Funds
Year Ended June 30, 2023

RECONCILIATION OF OPERATING INCOME (LOSS)

TO NET CASH PROVIDED BY (USED FOR)

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

Depreciation/amortization
(Increase) decrease in accounts receivable
(Increase) decrease in inventories
(Increase) decrease in due from other governments
(Increase) decrease in prepaid expense
Increase (decrease) in accrued liabilities
Increase (decrease) in due to other governments
Increase (decrease) in deposits payable
Increase (decrease) in unearned revenue
Increase (decrease) in OPEB liability
Increase (decrease) in pension liability
Increase (decrease) in claims and judgments
Total adjustments
Net cash provided by (used for) operating activities

SCHEDULE OF NON-CASH ACTIVITIES
Donated capital assets
Capital assets purchased on account
Unrealized gain (loss) on investments
Amortization of deferred inflows related to leases
Governmental
Activities-
Internal
Totals Service Funds
(12,171,049)$ (13,758,581)$
18,695,740 5,030,460
2,096,827 8,394
(686,516) 21,401
(487,224) -
29,664 783,215
(346,181) 1,313,492
(1,320,324) -
58,290 -
(70,694) -
(1,705,542) (168,179)
2,158,536 425,589
- 11,649,318
18,422,576 19,063,690
6,251,527$ 5,305,109$
1,939,797$ 1,344,057$
257,829 690
(1,233,753) (881,290)
(300,394) -
See accompanying notes to financial statements.
45 April 16, 2024
Item #2 Page 89 of 244
Private
Purpose Custodial
Trust Fund Funds
ASSETS
Cash and cash equivalents 1,143,775$ 11,079,365$
Restricted assets:

Cash and investments - 2,370,330
Receivables:

Assessments - 24,382
Accrued interest 4,947 47,922
Taxes - 595
Loans receivable 4,567,798 -
Total assets 5,716,520 13,522,594

LIABILITIES
Accrued liabilities - 134,740
Accrued interest 17,667 -
Due to bondholders - 6,370,885
Long-term liabilities:

Due in one year 1,000,000 -
Total liabilities 1,017,667 6,505,625

NET POSITION
Restricted for:

Redevelopment obligation retirement purposes 4,698,853 - Individuals, organizations and other governments - 7,016,969 Total net position 4,698,853$ 7,016,969$

CITY OF CARLSBAD
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2023
See accompanying notes to financial statements.
46 April 16, 2024
Item #2 Page 90 of 244
Private
Purpose Custodial
Trust Fund Funds

ADDITIONS
Assessment district collections -$ 14,006,750$ Proceeds from debt issuance - 16,240,000 Income from property and investments 3,911 169,965 Taxes 949,059 1,308,000
Interest on housing loans 112,624 -
Miscellaneous - 4,418,368
Total additions 1,065,594 36,143,083

DEDUCTIONS
Distributions to beneficiaries - 6,054,378 Administrative expenses 7,866 162,596
Debt refunding - 22,236,632
Bond interest expense and fees 63,607 1,544,538 Principal expense - 2,365,000
Other deductions - 2,234,380
Total deductions 71,473 34,597,524
Net increase (decrease) in fiduciary net position 994,121 1,545,559 Net position-beginning, restated 3,704,732 5,471,410 Net position-ending 4,698,853$ 7,016,969$

CITY OF CARLSBAD
Statement of Changes in Fiduciary Net Position
Fiduciary Funds
For the Year Ended June 30, 2023
See accompanying notes to financial statements.
47 April 16, 2024
Item #2 Page 91 of 244

48 April 16, 2024
Item #2 Page 92 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The City of Carlsbad, Californi a (“city”), was incorporated on July 16, 1952. The city was a general law city until 2008, when the citizens in Carlsbad voted and approved the city to become a charter city. The city operates under a Council-Manager form of government and provides the following services: general government, public safety, community services and public works.

The accounting policies of the city and its component units conform to accounting principles generally accepted in the United States of America as applicable to governmental unit s . T h e f o l l o w i n g i s a s u m m a r y o f t h e m o r e significant policies:

A. Description and Scope of the Reporting Entity

As required by accounting principles generally accepted in the United States of America, these financial statements present the financial position of the city and its c omponent units, entities for which the city is considered to be financially accountable. The city is considered to be financially accountable for an organization if the city appoints a voting majority of that organization’s governing body and the city is able to impose its will on that organization or there is a potential for that organization to provide specific financial benefits to or impose specific financial burdens on the city. The city is also considered to be financially accountable for an organization if that organization is fiscally dependent upon the city (i.e., it is unable to adopt its budget, levy taxes, set rates or charges, or issue bonded debt wit hout approval from the city). In certain cases, other organizations are included as component units if the nature and significance of their rela tionship with the city are such that their exclusion would cause the city’s financial statements to be misleading or incomplete.

Based upon the above criteria, the component units of the city are the Housing Authority of the City of Carlsbad, the City of Carlsbad Public Improvement Corporation, the Carlsb ad Public Financing Authority, and the Carlsbad Municipal Water District. The city does not issue separate financial statements for these component units.

Since the City Council serves as the governing board for these component units and there is either a financial benefit/burden relationship between the component unit and city or the management of the city has the operational responsibility for the component unit, all of the c ity’s component units are considered to be blended component units. Blended component units, although legally sepa rate entities, are in substance part of the city’s operations, and so data from these units is reported with the interfund data of the primary government.

B. Government-wide and Fund Financial Statements

The Government-wide Financial St atements (i.e., the Statement of Net Position and the Statement of Activities) report information on all of the nonfiduciary activities of the city and its blended component units. The effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental r evenues, are reported separately from business-type activities, which rely to a significant extent on user fees and charges for support.

The Statement of Activities demonstrates the degree to which th e direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable to 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 functio n 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 classified as program revenues are reported as general revenues.

Separate financial statements are provided for governmental fun ds, proprietary funds, and fiduciary funds, even though the latter are excluded from the Government-wide Financi al Statements. Major individual governmental funds and major individual enterprise funds are reported in separate columns in the Fund Financial Statements. 49 April 16, 2024
Item #2 Page 93 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

C. Measurement Focus, Basis of Accounting, and Financial Statem ent Presentation

The Government-wide Financial Statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the Proprietary Fund an d Fiduciary Fund Financial Statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. In applying the susceptible to accrual conc ept to intergovernmental revenues, the legal and contractual requirements of the individual programs are used as guidance. Property taxes are recognized as revenues in the year for which they are levied.

Governmental Fund Financial Statements are reported using the c urrent financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered 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 to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures are recorded when a liability is incurred, as under accrual accounting, as long a s the expenditure reflects a near-term cash outflow.

Principal and interest on long-term debt are recorded as fund liabilities when due.

Revenues that are accrued include real property taxes, sales ta x, transient occupancy taxes (TOT), franchise taxes, highway users’ tax, interest, and some state and federal grants.

Real property taxes are levied on October 15 against property owners of record on January 1 of that year. The taxes are due in two installments, on November 1 and February 1, and become delinquent after December 10 and April 10, respectively. Tax liens attach annually as of 12:01 a .m. on the first day of January in the fiscal year for which the taxes are levied. Under the provisions of NCGA (Natio nal Council on Government Accounting) Interpretation 3, property tax revenue is recognized in the fiscal year for which the taxes have been levied, provided it is collected within 60 days of the end of the fiscal year.

Custodial funds, which are a type of fiduciary fund, account fo r assets held by the city for other governments or individuals. These funds report using an economic resources measurement focus and include all inflows, outflows and balances reflecting the fund’s net position.

The city reports the following major governmental funds:

• The General Fund is the city’s primary operati ng fund. It accounts for all fina ncial resources of the general government, except those required to be accounted for in another fund.

• The Community Facilities District (CFD) No. 1 capital project fund is used to account for the receipt of taxes and fees charged to devel opers that are restricted for civic facilities, parks, and road segments.

• The Infrastructure Replacement (IRF) capital project fund is used to account for transfers from the General Fund and expenditures for the replacement of major infrastructure throughout the city.

• The Park Development capital project fund is used to account for the receipts and ex penditures for park related projects.

The city reports the following major enterprise funds:

• The Carlsbad Municipal Water District (CMWD) enterprise funds a re used to account for the operation,
maintenance, and capital facility financing of the city’s potable and recycled water systems.

• The Wastewater enterprise funds are used to account for the operation, mainte nance, and capital facility financing of the city’s wastewater system.
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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Additionally, the city reports the following fund types:

• Internal Service funds account for fleet maintenance and replacement, self-insured ben efits, information technology, risk management and wo rkers’ compensation services provided to other departments or agencies of the city.

• The Custodial funds account for assets held by the city for other governments or in dividuals. These funds include debt service transactions on assessment district bonds for which the city is not obligated and the city’s two Business Improvement Districts: the Carlsbad Tourism Busine s s I m p r o v e m e n t D i s t r i c t a n d t h e Carlsbad Golf Lodging Business Improvement District.

• The Private-Purpose Trust fund accounts for the activities of the Redevelopment Obligation Re tirement Fund, which accumulates resources for obligations previously in curred by the former City of Carlsbad Redevelopment Agency (RDA).

As a general rule, the effect of interfund activity has been eliminated from the Government-wide Financial Statements. An exception to this general rule is the charges between the Carlsbad Municipal Water District and various other functions of the city. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned.

Proprietary funds distinguish operating revenues and expenses f rom nonoperating items. Operating revenues and expenses result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the city’s proprietary funds are charges to customers for sales and services. The city also recognizes new account charges, late fees, and contributions from other agencies as operating revenues. Operating expenses for enterprise and internal service funds include the cost of sales and services, general and administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses.

When both restricted and unrestricted resources are available f or use, it is the city’s policy to use restricted resources first, then unrestricted resources as they are needed . When expenditures are incurred for purposes for which both restricted and unrestricted (committed, assigned, or unassigned) fund balances are available, restricted revenue will be applied first. When expenditures are incurred f or purposes for which committed, assigned, or unassigned fund balances are available, the policy is to apply committed fund balance first, then assigned fund balance and finally unassigned fund balance.

D. Cash and Investments

Cash includes amounts in demand and time deposits. Investments are reported in the accompanying balance sheet at fair value, except for certain investment contracts th at are reported at cost because they are not transferable, and they have terms that are not affected by changes in market interest rates.

Changes in fair value that occur during a fiscal year are recog nized as income from property and investments reported for that fiscal year. Income from property and investm ents includes interest earnings; changes in fair value; any gains or losses realized upon the liquidation, matur ity, or sale of investments; property rentals and the sale of city owned property.

The city pools cash and investments of all funds, except for assets held by fiscal agents. Each fund’s share in this pool is displayed in the accompanying financial statements as cash and investments. Investment income earned by the pooled investments is allocated to the various funds on a m onthly basis, based on each fund’s average cash and investments balance. Restricted cash and investments represent amounts that are restricted under the terms of debt agreements.
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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

E. Inventories

Inventories consist of materials and supplies that are valued at cost and are recorded as expenses or expenditures on a first-in, first-out basis when consumed.

F. Compensated Absences

Compensated absences are comprised of vacation payable for all city employees and banked overtime (comp time). Vacation pay and comp time are payable to employee s at the time used or upon termination of employment. For governmental funds, the cost of accumulated vacation and comp time expected to be paid in the next 12 months is recorded as a liability in the Self-Insured B enefits internal service fund. Since the city caps the amount of vacation and comp time employees are allowed to have on the books at any point in time, for compensated absences recorded at June 30, 2023, all balances ar e expected to be paid within the following 12 months. For proprietary funds, the cost of vacation and comp time is recorded as a liability when earned.

G. Risk Management

The city accounts for its general liability and workers’ compen sation activities in internal service funds. The funds are responsible for collecting premiums from other city funds and departments and paying claims, settlements, and insurance premiums. Interfund premiums are based on the insured fund’s claims experience. Incurred but not reported claims are accrued at year-end if material.

H. Unbilled Services

Unbilled water and wastewater revenues of the enterprise funds are recognized as earned when the services are used.

I. Capital Assets

Capital assets, which include land (including right-of-way), buildings, equipment, lease assets, subscription assets, and infrastructure assets (e.g., roads, bridges, traffic signal s, water and wastewater systems, and related items), are reported in the applicable governmental or business-type activities columns in the Government-wide Financial Statements. Capital assets are defined by the city as machinery and equipment and capital construction with an initial, individual cost of more than $10,000 and an estimated useful life in excess of one year; and intangible assets such as computer software with an initial cost of more than $100,000, and an estimated useful life in excess of one year. Such assets are recorded at historical cost or est imated 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 an asset or materially extend an asset’s useful life are not capitalized. Construction in progress costs are transferred to their respective capital asset category upon completion.

Depreciation and amortization on right-to-use assets is charged to operations using the straight-line method based on the estimated useful life of an asset. The estimated useful lives of depreciable assets are as follows:

Buildings and other structures 10 − 50
Improvements other than buildings 10 − 50
Infrastructure 10 − 100
Intangible assets 5 − 10
Machinery and equipment 5 − 20
Wastewater treatment facility (incluiding equipment) 5 − 75 Subscriptions 1 − 5
Years

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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

The city has capitalized all general infrastructure assets acquired or constructed. In addition, the land upon which the streets and roads are constructed (right-of-way) has also been valued and capitalized.

J. Unearned Revenue

The unearned revenue reported in the city’s financial statements represents money received during the current or previous fiscal years that has not been earned by the city as o f the end of the fiscal year. These monies will be recognized as revenues in subsequent fiscal years once the revenue has been earned.

K. Deferred Outflows

In addition to assets, the statement of financial position repo rts a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net assets that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The city has pension-related and other postemployment benefits related items in this category.

L. Deferred Inflows

In addition to liabilities, the statement of financial position reports a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, repr esents an acquisition of net assets that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The city has three types of items that qualify for reporting in this category.

The first item, unavailable revenue, is reported only in the go vernmental funds balance sheet. The governmental funds report unavailable revenues from two sources: interest on advances and loans and grants. This amount is deferred and recognized as an inflow of resources in the period that the amount becomes available.

The second item is reported in the proprietary funds balance sheet and the Statement of Net Position. The city has pension related and other postemployment benefits related items in this category.

The third item is reported in the proprietary funds balance she et and the Statement of Net Position. The city has lease related items in this category.

M. Interfund Transactions

Activity between funds that is representative of lending/borrowing arrangements outstanding at the end of the fiscal year is referred to as either “due to/from other funds” (short-term interfund loans), or “advances to/from other funds” (long-term interfund loans ). Any residual balances outst anding between the governmental activities and business-type activities are reported in the Government-wide Financial Statements as “internal balances.”

The portion of fund balance associat ed with amounts that have b een disbursed to other funds in the form of long- term interfund advances have been classified as nonspendable unless the funds associated with repayment of the advance are otherwise restricted for a specific purpose. 53 April 16, 2024
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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

N. Receivables and Payables

All trade, service and tax receivables are shown net of an allowance for uncollectibles. The utility billing receivable allowance is equal to 2% of outstanding billings at June 30, 2023, the ambulance billing receivable allowance is equal to 40% of outstanding billings at June 30, 2023, and the trade and false alarm receivable allowance is equal to 19% of the total of all outstanding receivable balance at Ju ne 30, 2023. The only exceptions to these rules are receivables that were subsequently paid or were known to be collectible at year-end, which were not reserved for at June 30, 2023, and any receivables due from other public agencies.

O. Loan and Reimbursement Receivable

The accompanying financial statements reflect the recording of certain loans receivable that represent loans made to various organizations and indi viduals. In certain cases, the amount of collection is dependent upon future residual receipts to be generated by the property or contingent upon the ability of the owner to sell the property at an amount sufficient to pay all liens against the property, including the obligation to the city. All loan and reimbursement receivables are shown net of an allowance for uncollectibles.

P. Encumbrances

Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is employed as an extension of formal budgetary control in the governmental funds. Unexpended and unencumbered appropriations lapse at fiscal year-end unless City Council takes action in the form of a resolution to continue the appropriation into the following fiscal year.

Q. Net Position

Net position represents the differences between assets and defe rred outflows, and liabilities and deferred inflows. Net investment in capita l assets, consist of capital a ssets, net of accumulated depreciation, reduced by the outstanding balances of any borrowings, used for the acquis ition, construction or improvement of those assets. Net investment in capi tal assets excludes unspent debt proceeds. Net position is reported as restricted when there are limitations imposed on its use either through th e enabling legislation adopted by the city or through external restrictions imposed by creditors, grantors, o r laws or regulations of other governments. It is the city’s policy to consider restricted net position to have b een depleted before unrestricted net position is applied.

R. Cash Flows

Statements of cash flows are pres ented for proprietary fund typ es. Cash and cash equivalents include all unrestricted and restricted highly liquid investments with orig inal purchase maturities of three months or less.

Pooled cash and investments in the city’s Treasury represent mo nies in a cash management pool and such accounts are similar in nature to demand deposits.

S. Long-term Obligations

In the Government-wide Financial Statements, and proprietary fu nd types in the Fund Financial Statements, long- term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type Statement of Net Position. 54 April 16, 2024
Item #2 Page 98 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

T. Pensions

For purposes of measuring the net pension liability, deferred o utflows and inflows of resources related to pensions, and pension expense, information about the fiduciar y net position of the city’s California Public Employees’ Retirement System (CalPERS) plans (Plans) and additi ons to/deductions from the fiduciary net position have been determined on the same basis as they are rep orted 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.

Valuation Date (VD) June 30, 2021
Measurement Date (MD) June 30, 2022
Measurement Period (MP) July 1, 2021 to June 30, 2022

U. Other Postemployment Benefits (OPEB)

For purposes of measuring the net OPEB asset/liability, deferre d outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information abo ut the fiduciary net position of the city’s plan (OPEB Plan), the assets of which are held by the California Employers’ Retiree Benefit Trust (CERBT), and additions to and deductions from the OPEB Plan’s fiduciary net position have been determined by an independent actuary. For this purpos e, benefit payments are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value.

Generally accepted accounting principles require that the reported results must pertain to liability and fiduciary net position information within certain defined timeframes. For this report, the following timeframes are used:

Valuation Date (VD) June 30, 2021
Measurement Date (MD) June 30, 2022
Measurement Period (MP) July 1, 2021 to June 30, 2022

V. Fair Value Measurements

Certain assets and liabilities are required to be reported at f air value. The fair value framework provides a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quot ed prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of fair value hierarchy are described as follows:

Level 1 – Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets.
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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, and fair value is determined thr ough the use of models or other valuation methodologies including:

• Quoted prices for similar assets or liabilities in active mark ets;

• Quoted prices for identical or si milar assets or liabilities in markets that are inactive;

• Inputs other than quoted prices that are observable for the as set or liability; and

• Inputs that are derived principally from or corroborated by ob servable market data by correlation or other means.

Level 3 – Inputs to the valuat ion methodology are unobservable and significant to the fair value measurement.

These unobservable inputs reflect the city’s own assumptions about the inputs market participants would use in pricing the asset or liability (including assumptions about risk). These unobservable inputs are developed based on the best information available in the circumstances and may include the city’s own data.

W. Fund Balances

Nonspendable Fund Balance includes amounts that cannot be spent because they are either not spendable in form (such as inventory) or legally or contractually required to be maintained intact (such as endowments).

Restricted Fund Balance – this includes amounts that can be spent only for specific purposes stipulated by the constitution, external resource providers, or through enabling legislation. If the City Council action limiting the use of funds is included in the same action (legislation) that created (enables) the funding source, then it is restricted.

Committed Fund Balance – this includes amounts that can be used only for the specific purposes determined by a formal action of the City Coun cil. It includes legislation (council action) that can only be overturned by new legislation requiring the same type of voting consensus that created the original action. Therefore, if the City Council action limiting the use of the funds is separate from t he action (legislation) that created (enables) the funding source, then it is committed, not restricted. The city considers a resolution to constitute the formal action of the City Council that is necessary to commit fund balance.

Assigned Fund Balance – this inc ludes amounts that are designat ed or expressed by the City Council but does not require a formal action like a resolution or ordinance. The City Council has delegated the authority for the City Manager to carry forward certain unspent budget amounts for specific one-time purposes if the amount is equal or less than $100,000 per item to the next fiscal year. The City C ouncil has authorized, through resolution, that all outstanding encumbrances at the end of the fiscal year and certain unspent budgeted amounts over $100,000 per item to be carried forward into the next fiscal year. The assig ned fund balance also includes an assignment for economic uncertainty and an assignment of General Fund budget s urplus for Fleet Maintenance, Risk Management and Workers’ Compensation Internal Service Funds, all of which were approved by the City Council through a resolution. These amounts are show as assigned fund balance at the end of the fiscal year:

• General Government – unspent funds for a Transient Occupancy Tax audit engagement contract and a cost allocation plan update contract. Encumbrances rolled forward in clude grant writing services, financial audit services, ambulance billing services, website content and socia l media management services for economic development and various professional services for communications, human resources, finance and the city manager’s office.
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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

• Public Safety – unspent funds for vehicles for a police officer take home vehicle program, replacement of the police department’s taser inventory, an increase in the school crossing guard contract, vehicle outfitting costs for the Homeless Outreach Team, a police services community survey and unspent grant funds on a police officer wellness and mental health grant. Encumbrances rolled forward include the purchase and outfitting of new patrol vehicles, installation costs for fixed license plate recognition cameras, a contract for a needs assessment and proposal evaluation for a new CAD system, the purchase of two new fire engines, hydraulic rescue tools and the replacement of the fire department’s self-contained breathing apparatus inventory.

• Community Services – unspent funds for state library grants, c ontract funds to update guidelines for Carlsbad tribal, cultural and paleontologi cal resources, weed abatement costs, agreements for temporary public art, maintenance costs on permanent public art, an agreement for a guest artist residency and trail improvements at Lake Calavera Preserve. Encumbrances rolled forward include engineering and building plan check services, consulting services for transportation and traffic en gineering services, citywide abandoned items/litter removal services, an agreement for rapid rehousing program services, master and strategic planning services for Parks and Recreation, repair services for the Lake Calavera Trail loop, irrigation system replacements at various park si tes and minor concrete and fence repair and replacements at Poinsettia Community Park.

• Public Works – unspent funds for HEPA filter replacements at the Safety Training Center and contract funds for an active transportation monitoring report. Encumbrances rolled forward include agreements for the habitat management plan preserve steward services and a green b usiness network coordinator, pressure washing services, a cargo van, electrical maintenance services, citywide roof inspection services, mark-out services for traffic signals, professional services for a cityw ide speed limit reduction evaluation, sustainable mobility implementation plan and safe routes to school program.

• Capital Projects – includes citywide infrastructure replacemen t projects, barrio street lighting, village and barrio traffic circles, Buena Vista Creek channel fencing, beach access repairs, village decorative lighting, Kelly Drive channel repair, Police and Fire Headquarters refurb ishment, Hosp Grove playground refurbishment, Calavera Hills Community Center refurbishment, Fleet service center fuel island upgrades, an enterprise asset management system, Lake Calavera Outlet Improvements and Leo Carrillo Ranch Roof Repair.

• Risk Management – City Council assigned general fund surplus f rom fiscal year 2022-23 to the city’s Risk Management Internal Service Fund in order to increase the reserve balance for several large claims.

• Workers’ Compensation – City Council assigned general fund sur plus from fiscal year 2022-23 to the city’s Workers’ Compensation Internal Service Fund in order to address increases in claim volume and average claim costs.

• Safer Streets Local Emergency – City Council assigned general fund surplus to address traffic safety. The City Council declared a local emergency via City Council resolution.

• Economic Uncertainty – City Council assigned reserve that can be utilized via City Council resolution to mitigate general revenue losses during times of economic downturns.

• Pension Trust – The City Council approved the establishment of a Public Agencies Post-Employment Benefits Trust (Section 115 Trust) on September 12, 2023. This trust allows the city to stabilize pension cost volatility, maintain local control
over the city’s assets and earn a potentially higher rate of return than if the assets were kept within the General Fund. The City Council approved an initial trust contribution of $10 million on September 26, 2023 as part of an ongoing effort to maintain compliance with City Council Policy Statement No. 86 and the city’s minimum 80% pension funded ratio.

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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Unassigned Fund Balance – this includes the remaining spendable amounts which are not included in one of the other classifications. The General Fund is the only fund that reports a positive unassigned fund balance amount.

It is the city’s policy that restricted resources will be appli ed first, followed by (in order of application) committed, assigned, and unassigned resources, in the absence of a formal policy adopted by the City Council.

X. Leases

Lessee: The city is a lessee for a noncancellable lease of buildings and land improvements. The city recognizes a lease liability and an intangible right‐to‐use lease asset (lease asset) in the government‐wide financial statements.

The city recognizes lease liabilities with an initial, individual value of $5,000 or more.

At the commencement of a lease, the city initially measures the lease liability at the present value of payments expected to be made during the lease term. Subsequently, the le ase liability is reduced by the principal portion of lease payments made. The lease asset is initially measured as the initial amount of the lease liability, adjusted for lease payments made at or before the lease commencement date, p lus certain initial direct costs. Subsequently, the lease asset is amortized on a straight ‐line basis over its useful life. Key estimates and judgments re lated to leases include how the city determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) lease payments.

• The city uses the interest rate charged by the lessor as the discount rate. When the interest rate charged by the lessor is not provided, the city uses its estimated increme ntal borrowing rate as the discount rate for leases.

• The lease term includes the non-cancellable period of the leas e. Lease payments included in the measurement of the lease liabilit y are composed of fixed paymen ts and purchase option price that the city is certain to exercise.

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

Lease assets are reported with other capital assets and lease l iabilities are reported with long-term debt on the statement of net position.

Lessor: The city is a lessor for noncancellable leases of buildings and land. The city recognizes a lease receivable and a deferred inflow of resources in the government‐wide and governmental fund financial statements.

At the commencement of a lease, the city initially measures the lease receivable at the present value of payments expected to be received during the lease term. Subsequently, th e lease receivable is reduced by the principal portion of lease payments received. The deferred inflow of reso urces is initially measured as the initial amount of the lease receivable, adjusted for lease payments received at o r before the lease commencement date.

Subsequently, the deferred inflow of resources is recognized as revenue over the life of the lease term. 58 April 16, 2024
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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Key estimates and judgments include how the city determines (1) the discount rate it uses to discount the expected lease receipts to present value, (2) lease term, and (3) lease receipts.

• The city uses its estimated incremental borrowing rate as the discount rate for leases.

• The lease term includes the non-cancellable period of the lease. Lease receipts included in the measurement of the lease receivable are composed of fixed payments from the lessee.

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

Y. Subscription-Based Information Technology Arrangements

The city is a subscriber for a noncancellable subscription of information technology services. The city recognizes a subscription liability and an intangible right ‐to‐use subscription asset (subscription asset) in the government‐wide financial statements. The city recognizes subscription liabilities with an initial, individual value of $5,000 or more.

At the commencement of a subscription, the city initially measures the subscription liability at the present value of payments expected to be made during the subscription term. Subsequently, the subscription liability is reduced by the principal portion of subscription payments made. The subscr iption asset is initially measured as the initial amount of the subscription liability, adjusted for subscription payments made at or before the subscription commencement date, plus certain initial direct costs. Subsequen tly, the subscription asset is amortized on a straight‐line basis over its useful life. Key estimates and judgments re lated to subscriptions include how the city determines (1) the discount rate it uses to discount the expect ed subscription payments to present value, (2) lease term, and (3) subscription payments.

• The city uses the interest rate charged by the vendor as the d iscount rate. When the interest rate charged by the vendor is not provided, the city uses its estimated increme ntal borrowing rate as the discount rate for subscriptions.

• The subscription term includes the non-cancellable period of t he subscription. Subscription payments included in the measurement of the subscription liability are c omposed of fixed payments that the city is certain to exercise.

The city monitors changes in ci rcumstances that would require a remeasurement of its subscriptions and will remeasure the subscription asset and liability if certain chang es occur that are expected to significantly affect the amount of the subscription liability.

Subscription assets are reported with other capital assets and subscription liabilities ar e reported with long-term debt on the statement of net position.

Z. New GASB Pronouncements Eff ective during Fiscal Year

The following Government Accounting Standards Board (GASB) pron ouncements were effective for and/or early implemented for the fiscal year ended June 30, 2023:
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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

1. GASB Statement No. 91, Conduit Debt Obligations

The requirements of this Statement will improve financial reporting by eliminating the existing option for issuers to report conduit debt obligations as their own liabilities, thereby ending significant diversity in practice. The clarified definition will resolve stakeholders’ uncertainty as to whether a given financing is, in fact, a conduit debt obligation. Requiring issuers to recognize liabilities associat ed with additional commitments extended by issuers and to recognize assets and deferred inflows of resources relat ed to certain arrangements associated with conduit debt obligations also will eliminate diversity, thereby improving comparability in reporting by issuers.

Revised disclosure requirements will provide financial statemen t users with better information regarding the commitments issuers extend and the likelihood that they will fulfill those commitments. That information will inform users of the potential impact of such commitments on the financ ial resources of issuers and help users assess issuers’ roles in conduit debt obligations.

2. GASB Statement No. 94, Public -Private and Public-Public Partne rships and Availability Payment Arrangements

The requirements of this Statem ent will improve financial repor ting by establishing the definitions of PPPs and APAs and providing uniform guidance on accounting and financial reporting for transactions that meet those definitions. That uniform guidance will provide more relevant and reliable information for financial statement users and create greater consistency in practice. This Statement will enhance the decision usefulness of a government’s financial statements by requiring governments to r eport assets and liabilities related to PPPs consistently and disclose essential information about PPP trans actions. The required disc losures will allow users to understand the scale and important aspects of a government’s PPPs and evaluate a government’s future obligations and assets resulting from PPPs.

3. GASB Statement No. 96, Subscription-Based Information Technology Arrangements

The requirements of this Statement will improve financial repor ting by establishing a definition for SBITAs and providing uniform guidance for accounting and financial reporti ng for transactions that meet that definition. That definition and uniform guidance will result in greater consistency in practice. Establishing the capitalization criteria for implementation costs also will reduce diversity and improve comparability in financial reporting by governments. This Statement also will enhance the relevance and reliability of a government’s financial statements by requiring a government to report a subscription asset and subscription liability for a SBITA and to disclose essential information about the arrangement. The discl osures will allow users to understand the scale and important aspects of a gover nment’s SBITA activities and ev aluate a government’s obligations and assets resulting from SBITAs.

4. GASB Statement No. 100, Accounting Changes and Error Corrections

The requirements of this Statement will improve the clarity of the accounting and financial reporting requirements for accounting changes and error corrections, which will result in greater consistency in application in practice. In turn, more understandable, dependable, relevant, consistent, an d comparable information will be provided to financial statement users for mak ing decisions or assessing acc ountability. In addition, the display and note disclosure requirements will re sult in more consistent, decisio n useful, understandable, and comprehensive information for users about accounting changes and error corrections.

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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 2: STEWARDSHIP, COMPLIA NCE, AND ACCOUNTABILITY

A. Budgetary Data

The city follows these procedures in establishing its budgetary data:

• During May or June, the City Manager submits a proposed operat ing, strategic digital transformation investment program and capital improvement program budgets for the fiscal year commencing the following July 1 to the City Council. The budget includes estimated reven ues and proposed expenditures on a departmental and/or project basis.

• In June, a public hearing is conducted at a City Council meeti ng to obtain citizens’ comments.

• Prior to July 1, the budget is enacted legally through passage of an appropriation resolution.

• For purposes of budgetary presen tation, actual revenues have been adjusted to exclude unrealized gains and losses pursuant to GASB. Actual expenditures have been adjusted to include encumbrances outstanding.

Annual budgets are adopted for the General Fund, special revenue funds and capital project funds.”

The City Manager is authorized to make transfers of appropriated amounts from one department to another within a fund. The legal level of budgetary control is at the fund level. Revisions that alter the total appropriations of any fund must be approved by the City Council with the exception of budget adjustments that involve offsetting revenues and expenditures, increases in General Liability and W orkers’ Compensation Fund claims expenses, increases in Encina Wastewater Authority expenses, increases of 15% or less to purchasing authority for capital outlay items requiring the City Council to act as the awarding authority as approved in the budget process, increases in earned leave accrual expenses and liabilities, inc reases in unforeseen legal expenses and liabilities and adjustments to increase the appropriation for Mutal Aid exp enses in an amount equal to the increases in amounts to be reimbursed by other agencies. The City Manager is authorized to increase or decrease an appropriation for a specific purpose where the appropriation is offset by unbudgeted revenue, which is designated for said specific purpose. Quarterly financial reports are prov ided to the City Council during the year, and any changes to the adopted budget are approved by the City Council as necessary. During the year, several supplementary appropriations were necessary.

Budgets for governmental type funds are adopted on the modified accrual basis except that encumbrances are treated as budgeted expenditures in the year purchases are comm itted. Expenditures may not exceed budgeted appropriations at the fund level. All appropriations lapse at f iscal year-end unless the City Council takes action in the form of a resolution to continue the appropriation into the following fiscal year or, if the appropriation is less than $100,000, the City Manager may approve to continue the appropriation into the following fiscal year.

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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 2: STEWARDSHIP, COMPLIA NCE, AND ACCOUNTABILITY

B. Deficit Fund Equity

The Following funds reported deficits in fund balances or net position as of June 30, 2023:

Special revenue funds:

Habitat and agricultural management (4,740)
California opioid settlement (9,874)
Internal service funds:

Risk management (4,083,823)
Deficit balance

The deficit of $4,740 in the Habitat and Agricultural Managemen t Special Revenue Fund is the result of the General Fund advancing money for the purchase of mitigation cre dits in a prior fiscal year. The advance is returned to the General Fund in periodic payments from developer impact fees collected in the Habitat and Agricultural Management Fund.

The deficit of $9,874 in the California Opioid Settlement Speci al Revenue Fund is the result of an unrealized loss recorded on investments recorded at fiscal year-end.

The deficit of $4,083,823 in the Risk Management Internal Servi ce Fund is the result of estimated claims tracking higher than anticipated. The City Council assigned general fund surplus budget in the amount of $5 million from fiscal year 2022-23 in response to higher claims. This will res ult in a fund transfer in fiscal year 2023-24 from the General Fund to the Risk Management Internal Service Fund.

NOTE 3: CASH AND INVESTMENTS

Cash resources of the individual funds are combined to form a pool of cash and investments. The city maintains a formal Investment Policy Statement, which is reviewed by the Investment Review Committee and adopted annually by the City Council. All investments held in the Treasurer’s Po ol are consistent with the city’s Investment Policy Statement objectives of safety of principal, sufficient liquidi ty, and to realize a return on investment. The risk disclosures on the next page apply to the city’s internal investment pool. Portfolio investments are exposed to five types of risk: custodial (investments and cash deposits), conce ntration, default, event, and market or interest rate risk.

The city and its agencies invest a portion of the funds in an e xternal investment pool known as the Local Agency Investment Fund (LAIF). Management and oversight are the respon sibility of the California State Treasurer. As of June 30, 2023, the LAIF performance report shows a fair value factor of 0.984828499. The city’s position in the LAIF pool is calculated as a percentage of the fair value of the city’s shares to the fair value of the pooled shares.

The city and its agencies invest a portion of the funds in an external investment pool known as the California Asset Management Program (CAMP). CAMP is a California Joint Powers Au thority directed by a Board of Trustees, which is made up of local government finance directors and treasurers.

Investments held outside the Treasurer’s Pool consist mainly of required reserve funds for various bond issues.

They are held by trustees and are not available for the city’s general expenditures. 62 April 16, 2024
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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 3: CASH AND INVESTMENTS (CONTINUED)

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

Statement of Net Position
Cash and investments 818,594,165 $
Restricted:

Cash and inv estments
Statement of Fiduciary Net Position
Cash and cash equivalents 12,223,140
Restricted:

Cash and inv estments 2,370,330
Total cash and inv estments 833,187,635$
Deposits with financial institutions 18,002,762$
Investments 812,814,543
Restricted:

Cash and inv estments 2,370,330
Total cash and inv estments 833,187,635$

A. Fair Value Measurement

The city categorizes its fair value investments within the fair value hierarchy established by generally accepted accounting principles. The city has the following recurring fair value measurements as of June 30, 2023:

Investment Type Total Level 1 Level 2 Uncategorized
U.S. Treasury obligations 75,318,700$ 75,318,700$ -$ -$ U.S. agency securities 309,326,161 - 309,326,161 - Certificates of deposit 19,735,113 - 19,735,113 - Medium-term notes 149,168,105 - 149,168,105 - Municipal investments 64,779,091 - 64,779,091 - Mortgage pass-through securities 33,350,238 - 33,350,238 - Supranational Secrurites 18,379,217 - - 18,379,217 California Asset Management Program 141,006,057 - - 141,006,057 Local Agency Inv estment Fund 1,751,861 - - 1,751,861 Total 812,814,543$ 75,318,700$ 576,358,708$ 161,137,135$ Input Category

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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 3: CASH AND INVESTMENTS (CONTINUED)

B. Custodial Credit Risk (Investments)

The city uses a third-party bank for its custody and safekeepin g service for its investm ent securities. Custodial credit risk is the risk that the city will not be able to recover the value of its investments in the event of the custodian’s failure. All city investments held in custody and safekeeping are held in the name of the city and are segregated from securities owned by the bank. This is the lowes t level of custodial credit risk exposure.

Investments are settled on Delivery vs. Payment (DVP) in accordance with the third-party custodial agreement.

C. Custodial Credit Risk (Deposits)

The city maintains cash accounts at one major banking institution. At the conclusion of each business day and if advantageous to the city, balances in these accounts are “swept ” into overnight pooled investments, which are pooled into funds collateralized wi th U.S. government securitie s (guaranteed) or U.S. agency securities (government- sponsored). The California Code authorizes both of these types of investments. Amounts up to $250,000 are Federal Deposit Insurance Corporation (FDIC) insur ed. All funds in non-interest-bearing transaction accounts are fully insured under the Dodd-Frank Wall Street Reform and Consumer Protection Act.

D. Concentration Credit Risk

Concentration credit risk is the heightened risk of potential l oss when investments are concentrated in one issuer. The California state code and the city’s Investment Policy Statement require that total investments in medium-term corporate notes of all issuers not exceed 30% of the portfolio. For concentration of investments, the city’s Investment Policy Statement requires that no more than 5% of investments in corporate notes or passthrough securities be in any one issuer. There is no similar requirement in either the state code or the city’s Investment Policy Statement for U.S. agencies. As of June 30, 2023, the portfolio was in compliance with this requirement.

E. Default Credit Risk

Default credit risk is the risk that the issuer of the security does not pay either the interest or principal when due.

Debts of most U.S. agencies are not backed by the full faith an d credit of the federal government. These agencies are U.S. government sponsored. In August 2011, Standard and Poor’s Investor’s Service downgraded U.S. long-term debt one step to AA+. Competing agencies, Moody’s Investors Service, and Fitch Ratings, maintained their AAA rating on U.S. debt. Although the default credit risk of these investments has increased, the city believes the risk of default remains low.

California state code limits inve stments in medium-term corpora te notes to the top three credit ratings (AAA, AA, and A). California stat e code and the city’s Investment Policy Statement allow the city Treasurer to determine the course of action to correct exceptions to the Investment Policy Statement. It is the intent of the city treasurer to hold these investments in the portfolio until maturity unless events indicate they should be sold. The default credit risk for corporate notes with a credit rating of single A is considered by the city Treasurer to be within acceptable limits for purposes of holding to maturity. A credit rating of single A is within state code purchase requirements.
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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 3: CASH AND INVESTMENTS (CONTINUED)

The Local Agency Investment Funds (LAIF) is an external investm ent pool managed by the California State Treasurer. The California Asset Management Program (CAMP) is an external investment pool managed by PFM Asset Management LLC. These investments are short-term and follow the investment requirements of the State.

LAIF is not rated; however, the city Treasurer considers the default credit risk to be minimal. CAMP is rated AAA by Standard and Poor’s Investor Services.

Money market funds held by bond tr ustees are rated AAA. Investm ent contracts held by bond trustees are not rated by rating agencies.

The table below is the minimum rating (where applicable) of the California state code, the city’s investment policy, or debt agreements, and the actual rating at June 30, 2 023 for each investment type by S&P Investor’s Service:

Minimum Exempt or
Investment Type Total Legal Rating Aaa Aa A Not Rated
U.S. Treasury obligations 75,318,700 $ Exempt - $ - $ - $ 75,318,700$ U.S. agency securities 309,326,161 Exempt - - - 309,326,161 Supranational Securities 18,379,217 AA 18,379,217 Municipal investments 64,779,091 AA/A 11,208,926 52,572,875 997,290 - Mortgage pass-through securities 33,350,237 AA 942,972 32,407,265 - - Medium-term notes 149,168,105 AA/A 21,321,311 45,805,881 82,040,913 - Local Agency Investment Fund 1,751,862 Not Rated - - - 1,751,862 Certificates of deposit 19,735,113 Not Rated - - - 19,735,113 California Asset Management Program 141,006,057 Not Rated 141,006,057 Total 812,814,543 $ - $ 51,852,426$ 130,786,021 $ 83,038,203 $ 547,137,893 $ Moody's Rating as of Fiscal Year End

Notes for this schedule:

• Certificates of Deposit are FDIC insured.

• As of June 30, 2023, five investments in medium term notes had credit ratings of single A (A) which is below the single A/double (AA) ratings required by the Investment Policy. These investments were initially made in accordance with the city's Investment Policy. California state code and the city's Investment Policy allow the city treasurer to determine the course of action to correct exc eptions to the policy. It is the intent of the city Treasurer to hold these assets in the portfolio until maturity unless events indicate a sale should be made.

These investments are paying interest at the required times and their principal is considered secure.

F. Interest Rate Risk

Interest rate risk is the risk that investments will lose market value because of increases in market interest rates.

A rise in market interest rates will cause the market value of investments made earlier at lower interest rates to lose value. The reverse will cause a gain in market value. As o f June 30, 2023, the portfolio had a 5% loss in market value based on cost.

The city’s Investment Policy St atement has adopted two means of limiting its exposure to market value losses caused by rising market interest rates: (1) limiting total port folio investments to a maximum modified duration of

2.2; and requiring liquid investments (LAIF and bank accounts) and investments maturing within one year to be equal to an amount that is not less than two-thirds of the curr ent fiscal year’s operating budget. The city met those requirements as follows:
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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 3: CASH AND INVESTMENTS (CONTINUED)

• As of June 30, 2023, the modified duration of the portfolio wa s 1.55. Modified duration is a prospective measure of the sensitivity of a fixed-income security’s value t o changes in market rates of interest. Modified duration identifies the potentia l gain/loss in value before it actually occurs. For example, a modified duration of 1.5 indicates that when and if a 1.0% change in market interest rates occurs, a 1.5% change in the security’s value will resul t. Investments with modified dur ations of one to three are considered to be conservative.

• As of June 30, 2023, maturities within one year exceeded the r equired minimum of $228,000,000 (two- thirds of current year operating budget for the city per the Fiscal Year 2022-23 operating budget adopted by the City Council).

• As of June 30, 2023, the weighted average maturity of the LAIF underlying debt securities was 260 days. As of June 30, 2023, LAIF had a 0.0152% loss in market value.

NOTE 4: LEASE RECEIVABLES

The city leases land and buildings to various companies and age ncies. The terms by lease type are listed in the table below. Some leases have extension options ranging from five to 20 years. As of June 30, 2023, the value of the lease receivable is $17,173,736. The value of the deferred inflow of resources as of June 30, 2023 was $16,687,779, and the amortization of the deferred inflow during the year totaled $1,093,387. The city recognized lease revenue of $3,491,084 during the fiscal year which includ ed $1,093,387 related to the amortization of the deferred inflow and $2,397,697 for variable and other payments, including short term leases not included in the measurement of the lease receivable.

Lease Lease Lease
Lease Type Term Range Receivable Revenue Interest
Land 5 - 19 years 1,821,540$ 159,786$ 33,009$ Buildings 2 - 80 years 10,362,076 633,207 144,123 Subtotal - gov ernmental activ ities 12,183,616 792,993 177,132 Lease Lease Lease
Lease Type Term Range Receivable Revenue Interest
Buildings 2 - 80 years 4,990,120 300,394 75,623 Subtotal - business-type activ ities 4,990,120 300,394 75,623 Total 17,173,736$ 1,093,387$ 252,755$
Governmental Activities
Business-type Activ ities

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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 4: LEASE RECEIVABLES (CONTINUED)

Future receivable principal and interest payments expected to be received through maturity are as follows:

June 30 Principal Interest Principal Interest Principal Interest 2024 626,989$ 225,231$ 234,858$ 87,656$ 861,847$ 312,887$ 2025 519,536 217,193 245,335 84,127 764,871 301,320 2026 542,838 209,232 254,704 80,433 797,542 289,665 2027 500,174 201,158 215,156 76,767 715,330 277,925 2028 516,406 193,133 213,124 73,336 729,530 266,469 2029-2033 2,255,165 845,409 1,125,866 310,866 3,381,031 1,156,275 2034-2038 1,624,551 683,689 910,153 223,559 2,534,704 907,248 2039-2043 745,105 593,220 221,481 178,774 966,586 771,994 2044-2048 649,942 569,428 - 195,178 649,942 764,606 2049-2053 429,026 552,023 - 220,826 429,026 772,849 2054-2058 - 600,834 - 249,844 - 850,678 2059-2063 - 679,788 - 282,676 - 962,464 2064-2068 - 769,118 - 319,821 - 1,088,939 2069-2073 152,766 708,562 63,524 294,640 216,290 1,003,202 2074-2078 468,767 411,626 194,927 171,1 66 663,694 582,792 2079-2083 529,130 351,263 220,027 146,065 749,157 497,328 2084-2088 597,265 283,127 248,360 117,733 845,625 400,860 2089-2093 674,174 206,218 280,341 85,751 954,515 291,969 2094-2098 760,987 119,405 316,440 49,652 1,077,427 169,057 2099-2102 590,795 26,000 245,824 10,812 836,619 36,812 Totals 12,183,616$ 8,445,657$ 4,990,120$ 3,259,682$ 17,173,736$ 11,705,339$ Governmental Activities Business-type Activities Total

NOTE 5: ACCRUED LIABILITIES

A. Summary

The balance of accrued liabilities at June 30, 2023 is composed of the following:

Community Infrastructure Other Internal Total
Facilities Replacement Park Governmental Service Governmental Classification General Fund District #1 Fund Development Funds Funds Activ es Accounts payable 3,816,834$ 224,539$ 631,407$ 96,439$ 2,950,162$ 1,756,641$ 9,476,022$ Retentions payable 36,477 - 232,163 - 576,549 690 845,879 Accrued wages 1,221,710 - - - 22,627 87,713 1,332,050 Employee benefits 516,594 - - - - - 516,594 Pension payable 641,312 - - - - - 641,312 Compensated absences - - - - - 6,949,494 6,949,494 Other 31,288 13,390 - - 42,056 9,655 96,389 Total 6,264,215$ 237,929$ 863,570$ 96,439$ 3,591,394$ 8,804,193$ 19,857,740$ Carlsbad Other Total
Municipal Enterprise Business-type Custodial
Water District Wastewater Funds Activities Funds
Accounts payable 1,465,768$ 773,566$ 316,433$ 2,555,767$ 107,994$ Retentions payable 66,666 192,233 2,354 261,253 - Accrued wages 62,361 27,094 20,709 110,164 - Compensated absences 451,136 99,055 60,166 610,357 - Other 8,524 51 441,151 449,726 26,746 Total 2,054,455$ 1,091 ,999$ 840,813$ 3,987,267$ 134,740$

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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 5: ACCRUED LIABILITIES (CONTINUED)

B. Compensated Absences

Compensated absences are liquidated by the internal service fun ds, Carlsbad Municipal Water District, Wastewater, and other enterprise funds. There is no fixed repayment schedule for compensated absences, and it is the policy of the City to treat compensated absences as a current liability. The compensated absences activities for the year ended June 30, 2023, are as follows:

Balance Net Balance
July 1, 2022 Change June 30, 2023
Governmental activities 6,278,968$ 670,526$ 6,949,494$ Business-type activities 503,675 106,682 610,357 Total 6,782,643$ 777,208$ 7,559,851$

NOTE 6: CAPITAL ASSETS

A. Governmental Activities

Governmental activities’ capital assets for the year ended June 30, 2023, was as follows:

Balance Balance
July 1, 2022 Adjustments Additions Deletions Transfers June 30, 2023 Governmental activities:

Capital assets, not being depreciated/amortized
Land 160,619,596$ -$ 234,610$ (1,105,548)$ -$ 159,748,658$ Construction-in-progress 36,891,555 - 14,530,673 (144,042) (17,562,696) 33,715,490 Total capital assets, not being depreciated/amortized 197,511,15 1 - 14,765,283 (1,249,590) (17,562,696) 193,464,148 Capital assets, being depreciated/amortized
Buildings and structures 138,281,470 - 4,197,578 - 11,515,345 153,994,393 Machinery, equipment, and vehicles 56,253,190 - 3,422,660 (508,253) 1,242,236 60,409,833 Lease assets 25,067 - 238,606 - - 263,673 Subscription assets - 1,845,563 3,009,014 - - 4,854,577 Intangible assets 6,483,648 - - (141,291) - 6,342,357 Land improvements 103,902,694 - 4,996,926 (60,690) 3,078,414 111,917,344 Infrastructure 752,669,574 - 431,667 - 1,726,701 754,827,942 Total capital assets, being depreciated/amortized 1,057,615,643 1,845,563 16,296,451 (710,234) 17,562,696 1,092,610,119 Less accumulated depreciation/amortization
Buildings and structures (51,495,406) - (2,854,207) - - (54,349,613) Machinery, equipment, and vehicles (30,615,090) - (4,308,090) 499,076 - (34,424,104) Lease assets (1,671) - (27,362) - - ( 29,033) Subscription assets - - (1,407,481) - - (1,407,481) Intangible assets (4,026,460) - (752,636) 141,291 - (4,637,805) Land improvements (43,323,472) - (3,688,898) - - (47,012,370) Infrastructure (317,127,346) - (14,836,507) - - (331,963,853) Total accumulated depreciation/amortization (446,589,445) - (27,875,181) 640,367 - (473,824,259) Total capital assets, being depreciated/amortized, net 611,026,1 98 1,845,563 (11,578,730) (69,867) 17,562,696 618,785,860 Total governmental activities capital assets 808,537,349$ 1,845,563$ 3,186,553$ (1,319,457)$ -$ 812,250,008$

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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 6: CAPITAL ASSETS (CONTINUED)

Depreciation/amortization expense was charged to the functions/ programs of the governmental activities of the primary government as follows:

General government 910,614$
Public safety 1,386,539
Community services 5,512,907
Public works 15,034,661
Internal service funds* 5,030,460
Total depreciation/amortization expense 27,875,181$

* Depreciation and amortization of capital assets held by the c ity’s internal service funds are charged to the various functions based on their usage of the assets.

B. Business-type Activities

Business-type activities’ capital assets for the year ended June 30, 2023, was as follows:

Balance Balance
July 1, 2022 Additions Deletions Transfers June 30, 2023 Business-type activ ities:

Capital assets, not being depreciated/amortized
Land 9,330,718$ 23,225$ -$ -$ 9,353,943$ Construction-in-progress 17,436,454 6,815,494 (1,649,219) (8,293,766) 14,308,963 Total capital assets, not being depreciated/amortized 26,767,172 6,838,719 (1,649,219) (8,293,766) 23,662,906 Capital assets, being depreciated/amortized
Buildings and structures 41,391,888 2,680,717 - - 44,072,605 Machinery, equipment, and v ehicles 14,007,845 918,863 (778,065) 6,631 14,155,274 Wastewater treatment facility 64,373,642 - (2,560,330) 7,216,853 69,030,165 Land improvements 56,202,412 175,672 - - 56,378,084 Infrastructure 404,212,142 5,364,562 - 1,070,282 410,646,986 Total capital assets, being depreciated/amortized 580,187,929 9,139,814 (3,338,395) 8,293,766 594,283,114 Less accumulated depreciation/amortization
Buildings and structures (14,088,720) (782,874) - - (14,871,594) Machinery, equipment, and v ehicles (6,713,329) (1,544,486) 757,585 - (7,500,230) Wastewater treatment facility (35,864,922) (5,459,570) 2,560,330 - (38,764,162) Land improvements (47,183,331) (3,088,699) - - (50,272,030) Infrastructure (135,173,919) (7,820,111) - - (142,994,030) Total accumulated depreciation/amortization (239,024,221) (18,695,740) 3,317,915 - (254,402,046) Total capital assets, being depreciated/amortized, net 341,163,7 08 (9,555,926) (20,480) 8,293,766 339,881,068 Total b
usiness-type activ ities capital assets 367,930,880$ (2,717,207)$ (1,669,699)$ -$ 363,543,974$

Depreciation/amortization expense was charged to the functions/ programs of the business-type activities of the primary government as follows:

Water 6,375,383$
Golf 3,405,438
Wastewater 8,914,919
Total depreciation/amortization expense 18,695,740$

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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 7: PENSION PLANS

The city contributes to two defined benefit pension plans. As o f and for the year ended June 30, 2023, the two plans had the following balances reported in the government‐wide financial statements:

Net Pension Deferred Outflows Deferred Inflows Pension
Liability of Resources of Resources Expense
Miscellaneous Plan 98,982,755$ 43,009,821 $ 1,287,622 $ 16,063,931 $ Safety Plan 99,544,716 44,498,750 - 17,582,794 Total pension plans 198,527,471$ 87,508,571 $ 1,287,622 $ 33,646,725 $

A. Plan Description, Benefits Provided, and Employees Covered

All qualified permanent and probationary employees are eligible to participate in the city’s Safety (sworn police and fire) and Miscellaneous (all other) Plans (the Plans), agen t multiple employer defined benefit pension plans administered by CalPERS, which acts as a common investment and administrative agent for its participating member employers. A full description of the Plans regarding number of employees covered, benefit provisions, assumptions (for funding, but not accounting purposes), and membership information are listed in the Plan’s June 30, 2021 Annual Actuarial Valuation Reports (funding valua tions). Details of the benefits provided can be obtained in Appendix B of the Actuarial Valuation Report. This report and CalPERS’ audited financial statements are publicly available reports that can be obtained at CalPERS’ website.

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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 7: PENSION PLANS (CONTINUED)

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. The Plans’ provisions and benefits in effect at June 30, 2023, are summarized as follows:

As of the valuation date, June 30, 2021, the following employees were covered by the benefit terms for each Plan:

Miscellaneous Safety
Inactive employees or beneficiaries currently receiving benefits6 4 5 2 7 9 Inactive employees or beneficiaries currently not receiving benefits 528 104 Activ e employees 528 212
1,701 595

B. Contribution Description

Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process. The actuarially de termined 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 On or after
Prior to November 28, 2011 to On or after
Hire date November 28, 2011 December 31, 2012 January 1, 2013 Benefit formula 3% @ 60 2% @ 60 2% @ 62
Benefit vesting schedule 5 years of service 5 years of service 5 years of service Benefit payments monthly for life monthly for life monthly for life Retirement age 50 - 60 50 - 63 52 - 67
Monthly benefits as a % of eligible compensation 2% to 3% 1.092 % to 2.418% 1.0% to 2.5% Required employee contribution rates 8.00% 7.00% 7.50%
Required employer contribution rates 15.12% 12.60% 11.72% Required employer payment of unfunded liability
On or after
Prior to November 28, 2011 to On or after
Hire date November 28, 2011 December 31, 2012 January 1, 2013 Benefit formula 3% @ 50 2% @ 50 2% @ 57
Benefit vesting schedule 5 years of service 5 years of service 5 years of service Benefit payments monthly for life monthly for life monthly for life Retirement age 50 50 - 55 50 - 57
Monthly benefits as a % of eligible compensation 3% 2.0% to 2.7% 2.0% to 2.7% Required employee contribution rates 9.00% 9.00% 13.50% Required employer contribution rates 23.41% 20.59% 19.79% Required employer payment of unfunded liability
Miscellaneous
Safety
$7,227,710
$5,881,880
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CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 7: PENSION PLANS (CONTINUED)

unfunded accrued liability. The em ployer is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employe r contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribut ion requirements that are identified by the pension plan terms as plan member contribution requirements are classified as plan member contributions. Plan contributions for the year equaled $19,626,500 and $14,880,482 for miscellaneous and safety, respectively.

C. Actuarial Methods and Assumpti ons Used to Determine Total Pension Liability

The June 30, 2021 valuation was rolled forward to determine the June 30, 2022 total pension liability, based on the following actuarial methods and assumptions:

Actuarial Cost Method Ent ry Age Normal Cost Method
Actuarial Assumptions
Discount rate 6.90%
Inflation 2.50%
Salary increases Varies by entry age and services
Mortality rate table Derived using CalPERS’ membership data for all funds Post-retirement benefit increases The lesser of contract COLA o r 2.50% until purchasing power protection allowance floor on purchasing power applies,

2.30% thereafter

The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2021 CalPERS Experience Study for the period from 2001 t o 2019. Pre-retirement and Post-retirement mortality rates include generational mortality improvement using 80% of Scale MP-2020 published by the Society of Actuaries. For more details on this table, please refer to t he CalPERS Experience Study and Review of Actuarial Assumptions report from November 2021 that can be found on the CalPERS website.

D. Long-term Expected Rate of Return

The long-term expected rate of return on pension plan investments was determined using a building-block method in which 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 expe cted rate of return, CalPERS took into account both short-term and long-term market return expectations. Using historical returns of all of the funds’ asset classes, expected compound (geometric) returns were calculated over the next 20 years usin g a building-block approach. The expected rate of return was then adjusted to account for assumed administrative expenses of 10 Basis points. The expected real rates of return by asset class are as follows:

Assumed
Asset
Asset Class Allocation Real Return 1, 2
Global equity-cap-weighted 30.00% 4.54%
Global equity-non-cap-weighted 12.00% 3.84%
Private equity 13.00% 7.28%
Treasury 5.00% 0.27%
Mortgage-backed securities 5.00% 0.50%
Investment grade corporates 10.00% 1.56%
High yield 5.00% 2.27%
Emerging market debt 5.00% 2.48%
Private debt 5.00% 3.57%
Real assets 15.00% 3.21%
Leverage -5.00% -0.59%
1 An expected inflation of 2.30% used for this period.
2 Figures are based on the 2021 Asset Liability Management study 72 April 16, 2024
Item #2 Page 116 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 7: PENSION PLANS (CONTINUED)

E. Discount Rate

The discount rate used to measure the total pension liability w as 6.90%. The projection of cash flows used to determine the discount rate assumed that contributions from pla n members will be made a t the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

F. Events Subsequent to the Actuarial Valuation Date

On July 12, 2021, CalPERS reported a preliminary 21.3% net retu rn on investments for fiscal year 2020-21.

Based on the thresholds specified in CalPERS Funding Risk Mitigation policy, the excess return of

14.3% prescribes a reduction in i nvestment volatility that corresponds to a reduction in the discount rate used for funding purposes of 0.20%, from 7.00% to 6.80%. Since CalPERS w as in the final stages of the four-year Asset Liability Management (ALM) cycle, the board elected to defer any changes to the asset allocation until the ALM process concluded, and the board could make its final decision on the asset allocation in November 2021

On November 17, 2021, the board adopted a new strategic asset a llocation. The new asset allocation along with the new capital market assumptions, economic assumptions and administrative expense assumption support a discount rate of 6.90% (net of investment expense but without a reduction for administrative expense) for financial reporting purposes. This includes a reduction in the price inflation assumption from 2.50% to 2.30% as recommended in the November 2021 CalPERS Experience Study and R eview of Actuarial Assumptions. This study also recommended modifications to retirement rates, termi nation rates, mortality rates and rates of salary increases that were adopted by the board. These new assumptions will be reflected in the GASB 68 accounting valuation reports for the June 30, 2022, measurement date.

G. Amortization of Deferred Outf lows and Deferred Inflows of Resources

Under GASB Statement No. 68, gains and losses related to change s in total pension liability and fiduciary net position are recognized in pension expense systematically over time.

The first amortized amounts are recognized in pension expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and defe rred inflows of resources related to pensions and are to be recognized in future pension expenses.

The amortization period differs depending on the source of the gain or loss:

Net difference between projected 5-year straight-line amortizat ion and actual earnings on pension
plan investments
All other amounts Straight-line amortization over the expected average remaining service lifetime (EARSL) of all members that are provided with benefits (active, inactive, and retired) as of the beginning of the measurement period.

The EARSL for the plan for the measurement period ending June 30, 2022 is 3.3 years, which was obtained by dividing the total service years of 5,648 (the sum of remaining service lifetimes of the active employees) by 1,701 (the total number of participants: active, inactive, and retired). Inactive employees and retirees have remaining service lifetimes equal to 0. Total future service is based on the members’ probability of decrementing due to an event other than receiving a cash refund.
73 April 16, 2024
Item #2 Page 117 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 7: PENSION PLANS (CONTINUED)

H. Changes in the Net Pension Liability

The following table shows the changes in net pension liability recognized over the measurement period:

1. Miscellaneous Plan
Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability/(Asset)
(a) (b) (c) = (a) - (b)
Balance at June 30, 2021 439,587,141 $ 404,540,402 $ 35,046,739 $ Changes recognized for the
measurement period:

Service cost 8,937,350 - 8,937,350 Interest on total pension liability 30,675,372 - 30,675,372 Changes of benefit terms - - - Changes of assumptions 13,648,298 - 13,648,298 Differences between expected and
actual experience (1,847,457) - (1,847,457) Contributions-employer - 14,517,690 (14,517,690) Contributions-employee - 3,756,998 (3,756,998) Net investment income - (30,545,136) 30,545,136 Benefit payments, including refunds of (22,572,119) (22,572,119) - employee contributions
Administrativ e expense - (252,005) 252,005 Net changes during 2021-22 28,841,444 (35,094,572) 63,936,016 Balance at June 30, 2022 468,428,585 $ 369,445,830 $ 98,982,755 $

74 April 16, 2024
Item #2 Page 118 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 7: PENSION PLANS (CONTINUED)

2. Safety Plan

Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability/(Asset)
(a) (b) (c) = (a) - (b)
Balance at June 30, 2021 350,937,662$ 308,361,275$ 42,576,387$ Changes recognized for the
measurement period:

Service cost 8,397,439 - 8,397,439 Interest on total pension liability 24,991,969 - 24,991,969 Changes of benefit terms - - - Changes of assumptions 13,165,149 - 13,165,149 Differences between expected and
actual experience 3,204,494 - 3,204,494 Contributions-employer - 13,322,734 (13,322,734) Contributions-employee - 3,020,571 (3,020,571) Net investment income - (23,360,492) 23,360,492 Benefit payments, including refunds of
employee contributions (18,607,148) (18,607,148) - Administrativ e expense - (192,091) 192,091 Net changes during 2021-22 31,151,903 (25,816,426) 56,968,329 Balance at June 30, 2022 382,089,565$ 282,544,849$ 99,544,716$

H. Sensitivity of the Net Pension Liability to Changes in the Discount Rate

The following presents the net pension liabilities calculated using the discount rate of 6.90%, as well as what the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (5.90%) or 1-percentage-point higher (7.90%) than the current rate:

Discount Rate Current Discount Rate
-1 Percent Discount Rate +1 Percent
(5.90%) (6.90%) (7.90%)
Misc. Plan's net pension liability/(asset) 160,489,037$ 98,982,755 $ 48,129,781 $ Safety Plan's net pension liability/(asset) 153,448,717 99,544,716 55,607,789 Total 313,937,754 $ 198,527,471 $ 103,737,570 $

75 April 16, 2024
Item #2 Page 119 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 7: PENSION PLANS (CONTINUED)

I. Pension Expense and Deferred Outflows and Deferred Inflows of Resources

For the fiscal year ended June 30, 2023, the city recognized $16,063,931 and $17,582,794 in pension expense for the Miscellaneous and Safety plans, respectively, for a total amount of pension expense of $33,646,725.

The following table presents deferred outflows and deferred inf lows of resources related to pensions as of the June 30, 2023:

1. Miscellaneous Plan
Deferred Outflows Deferred Inflows
of Resources of Resources
Contributions subsequent to the
measurement date 12,800,872 $ - $
Changes of assumptions 9,512,450 1,287,622
Differences between expected and
actual experience 1,435,886 -
Net difference between projected
and actual earnings on pension
plan inv estments 19,260,613 -
Total 43,009,821 $ 1,287,622 $

Amounts reported as deferred outflows and deferred inflows of resources related to pensions will be recognized in future pension expense as follows:

Deferred
Outflows/(Inflows)
Fiscal year ended June 30, of Resources
2024 7,952,273 $
2025 6,753,871
2026 2,560,361
2027 11,654,822
2028 -
Thereafter -
Total 28,921,327 $

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Item #2 Page 120 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 7: PENSION PLANS (CONTINUED)

2. Safety Plan

Deferred Outflows Deferred Inflows
of Resources of Resources
Contributions subsequent to the
measurement date 11,354,715 $ - $
Changes of assumptions 10,422,410 -
Differences between expected and
actual experience 7,841,143 -
Net difference between projected
and actual earnings on pension
plan inv estments 14,880,482 -
Total 44,498,750 $ - $

Amounts reported as deferred outflows and deferred inflows of resources related to pensions will be recognized in future pension expense as follows:

Deferred
Outflows/(Inflows)
Fiscal year ended June 30, of Resources
2024 8,296,315 $
2025 7,431,470
2026 5,783,739
2027 11,632,511
2028 -
Thereafter -
Total 33,144,035 $

77 April 16, 2024
Item #2 Page 121 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 8: OTHER POSTEMPLOYMENT BENEFIT (OPEB) OBLIGATIONS

The city offers other postemployment benefits in the form of he alth benefits to two employee groups:

City of Carlsbad employees and former CMWD employees. The majority of city and former CMWD employees are under the city defined benefit agent multiple-employer plan.

A. Benefit Description by Employee Group

1. Former Carlsbad Municipal Wa ter District (CMWD) employees

The benefit plan is for active and retired employees who were e mployed with CMWD at the time CMWD was acquired by the city. Per Resolution No. 614, all former employees of CMWD (including dependents) are eligible for postretirement health care benefit s if they voluntarily retire after the age of fifty, with no less than five years of service and whose age, combined with years of service, equals seventy or more.

The city pays for 100% of the health insurance premiums which i s coordinated with Medicare and other benefits provided by federal and state law, when available, to the exten t it reduces the cost of insurance premiums.

CalPERS administers this plan.

2. City of Carlsbad employees

City employees are offered health insurance coverage under the Public Employees’ Medical and Hospital Care Act (PEMHCA), which is administered by CalPERS. Under PEMHCA, the city is required to pay a small portion of the monthly medical premiums of retired employees (considered a sub sidy), if the retired employees continue their medical coverage under PEMHCA. Surviving spouses and domestic partners of eligible retirees are eligible for the city subsidy. Surviving spouses and domestic partners of deceased active members are eligible for the city subsidy only if the employee had attained age 50 with five years of service.

The city pays a monthly subsidy per eligible employee/retiree regardless of coverage elected:

Calendar Year 2021 143$
Calendar Year 2022 149
Calendar Year 2023 151

Thereafter, the subsidy is adjusted annually to reflect changes in the medical component of the Consumer Price Index.

3. California Public Employer’s Retiree Benefit Trust Program

The city is participating in the California Employer’s Retiree Benefit Trust Program (CERBT) through irrevocable trust agreements for both plans. CE RBT is administered by CalPE RS. The city’s OPEB fiduciary net position is included in the CERBT Schedule of Changes in Fiduciary Net Posi tion by Employer report. That report may be obtained on the California Public Employees’ Retirement System website at www.calpers.ca.gov under forms and publications.
78 April 16, 2024
Item #2 Page 122 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 8: OTHER POSTEMPLOYMENT BEN EFIT (OPEB) OBLIGATIONS (CONTINUED)

B. Employees Covered

As of the June 30, 2022, the measurement date, the following employees were covered by the benefit terms for each benefit tier:

Inactive employees or beneficiaries currently receiving benefits2 8 5 Inactive employees or beneficiaries not yet receiving benefits 3 16 Activ e employees 789
Total 1,390

C. Contributions

The obligation of CMWD to contri bute to the CMWD plan is establ ished and may not be amended by the CMWD Board. The obligation of the city to contribute to the city plan is established, and as long as the city is a member of PEMCHA, may not be amended by the City Council. The City Council does have the authority to change health insurance coverage outside of PEMHCA, which could change the funding obligation for city employees.

Employees are not required to contribute to the plan. The city and CMWD’s contributions are based on the actuarially determined contribution (ADC), an amount actuarially determined in accordance with the parameters of GASB. The ADC represents a level of funding that, if paid on an ongoing basis, is projected to cover the normal cost each year and to amortize any unfunded actuarial liabiliti es (or funding excess) over a period not to exceed 30 years on a “closed” basis. The city’s and CMWD’s contributions are as follows:

Fiscal Year 2022-23 Cash Contributions 693,884$
Fiscal Year 2022-23 Estimated Implied Subsidy Payments 449,142 Administrativ e Expenses Paid Outside of Trust 10,088
Total 1,153,114$

79 April 16, 2024
Item #2 Page 123 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 8: OTHER POSTEMPLOYMENT BEN EFIT (OPEB) OBLIGATIONS (CONTINUED)

D. Net OPEB Liability

The city’s net OPEB liability was measured as of June 30, 2022 and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation dated June 30, 2021, based on the actuarial methods and assumptions shown below:

Acturial Cost Method: Entry Age Normal
Acturial Assumptions:

Discount Rate 6.25%
Inflation 2.50%
Salary Increases 2.50%
Investment Rate of Return 6.25% with a 45% to 50% confidence bas ed on Bartel Associates modeling for CERBT Strategy 1
Mortality Rate (1) Derived using CalPERS Membership Data for all funds.

Pre-Retirement Turnover (2) Derived using CalPERS Membership Data for all funds.

Healthcare Trend Rate (3) Based in part on premium experience.

Notes:
1 Based on CalPERS 2000-2019 Experience Study. The Experience St udy Reports may be accessed on the CalPERS website www.calpers.ca.gov under Forms and Publications. 2 Based on CalPERS 2000-2019 Experience Study. The Experience St udy Reports may be accessed on the CalPERS website www.calpers.ca.gov under Forms and Publications. 3 Short-Term healthcare trends were developed in consultation with Axene Health Partner's healthcare actuaries. Long-term healthcare trend development using Society of Actuaries' Getzen Model of Long-Run Medical Cost Trends.

The target allocation and best estimates of arithmetic real rat es of return for each major asset class are summarized in the following table:

Target Long-Term Expected
Allocation Real Rate of Return
Global Equity 49% 4.56%
Fixed Income 23% 1.56%
TIPS 5% -0.08%
Commodities 3% 1.22%
REIT's 20% 4.06%
Total 100%
Notes:
1 The long-term expected rate of return is 6.25%
2 Assumed long-term rate of inflation is 2.5%
CERBT Strategy 1
Asset Class

80 April 16, 2024
Item #2 Page 124 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 8: OTHER POSTEMPLOYMENT BEN EFIT (OPEB) OBLIGATIONS (CONTINUED)

E. Discount Rate

The discount rate used to measur e the total OPEB liability was 6.25%. The projection of cash flows used to determine the discount rate assumed that city contributions wil l be made at rates equal to the actuarially determined contribution rates. Based on those assumptions, the OPEB Plans’ fiduciary net position was projected to be available to make all projected OPEB payments for current active and inactive employees and beneficiaries.

Therefore, the long-term expected rate of return on OPEB Plans investments was applied to all periods of projected benefit payments to determine the total OPEB liability.

The changes in the net OPEB (asset)/liability are shown below:

Total OPEB Plan Fiduciary Net OPEB
Liability Net Position Liability/(Asset)
(a) (b) (c) = (a) - (b)
Balance at June 30, 2021 19,761,187 $ 20,443,852 $ (682,665) $ Changes recognized for the
measurement period:

Service cost 757,499 - 757,499 Interest on total OPEB liability 1,248,183 - 1,248,183 Contributions-employer - 1,102,669 (1,102,669) Contributions-employee - - - Net investment income - (2,735,878) 2,735,878 Benefit payments, including refunds of
employee contributions (1,095,532) (1,095,532) - Administrativ e expense - (12,314) 12,314 Net changes during 2021-22 910,150 (2,741,055) 3,651,205 Balance at June 30, 2022 20,671,337 $ 17,702,797 $ 2,968,540 $

F. Sensitivity of the Net OPEB L iability to Changes in the Discount Rate

The following presents the net OPEB liability of CMWD and city if it were calculated using a discount rate that is one percentage point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2022:

Discount Rate Current Discount Rate
-1 Percent Discount Rate +1 Percent
(5.25%) (6.25%) (7.25%)
Plan's net OPEB liability/(asset) 5,579,612$ 2,968,540$ 802,183$

81 April 16, 2024
Item #2 Page 125 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 8: OTHER POSTEMPLOYMENT BEN EFIT (OPEB) OBLIGATIONS (CONTINUED)

G. Sensitivity of the Net OPEB Liability to Changes in the Health Care Cost Trend Rates

The following presents the net OPEB liability of the CMWD and city if it were calculated using health care cost trend rates that are one percent age point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2022:

Current
1 Percent Heathcare 1 Percent
Decrease Trend Rate Increase
Plan's net OPEB liability/(asset) 364,085 $ 2,968,540 $ 6,183,979 $

H. Recognition of Deferred Outflows and Deferred Inflows of Res ources

Gains and losses rel ated to changes in t otal OPEB liability and fiduciary net position are recognized in OPEB expense systematically over time.

Amounts are first recognized in OPEB expense for the year the g ain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resour ces related to OPEB and are to be recognized in future OPEB expenses. The initial recognition period is five years.

I. OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB

For the fiscal year ended June 30, 2023, the city recognized OP EB expense of $1,204,200. As of June 30, 2023, the city reported deferred outflows of resources related to OPEB from the following sources:

Deferred Outflows Deferred Inflows
of Resources of Resources
Contributions subsequent to the
measurement date 1,153,114 $ - $
Changes of assumptions 1,170,894 183,423
Differences between expected and
actual experience 674,703 712,583
Net difference between projected
and actual earnings on OPEB
plan investments 1,484,839 -
Total 4,483,550 $ 896,006 $

82 April 16, 2024
Item #2 Page 126 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 8: OTHER POSTEMPLOYMENT BEN EFIT (OPEB) OBLIGATIONS (CONTINUED)

The $1,153,114 reported as deferre d outflows of resources related to contributions subsequent to the June 30, 2022 measurement date will be recognized as a reduction of the net OPEB liability during the fiscal year ending June 30, 2024. Other amounts reported as deferred outflows and inflows of resources related to OPEB will be recognized as expense as follows:

Deferred
Outflows/(Inflows)
Fiscal year ended June 30, of Resources
2024 898,337 $
2025 850,935
2026 638,234
2027 1,292,346
2028 434,035
Thereafter (1,679,457)
Total 2,434,430 $

NOTE 9: SIGNIFICANT COMMMITMENTS

A. Water Purchase Agreements

On August 5, 2003, CMWD entered into a 22-year agreement with the Vallecitos Water District, to purchase three million gallons per day (3,360-acre feet) of recycled water for uses throughout CMWD’s boundaries. Per the agreement, there is an annual reconciliation that trues up the monthly payments to the actual cost for the water purchased each fiscal year. The recycled water cost is adjusted every July 1st and shall not exceed 75% of the wholesale cost of potable water from SDCWA. The agreement also stipulates that CMWD will pay for its share of the actual operating costs (up to a maximum cost of 75% of the wholesale cost of potable water from the San Diego County Water Authority) of the Mahr Reservoir, which prod uces the water. The estimated operating costs paid by CMWD for the period ended June 30, 2023, are $2,761,924.

B. Golf Course Advances

The Golf Course Fund previously showed an advance from other fu nds balance in the amount of $47,031,506 representing loans received from the city’s General Fund that w ere used to fund the initial course construction and some operating costs. For financial statement purposes, the se loans were reclassified to “Transfers In” in fiscal year 2022 recognizing that the repayment of these loans is not scheduled to happen in the near and near future.

The city has not forgiven the loans and the advances are now being disclosed as a contingent liability of the Golf Course Fund. The balance of these loans is $55,458,868 in total, $47,031,506 of principal and $8,427,362 of interest. The city discontinued accruing interest on the advanc es in fiscal year 2013-14. Should sufficiently resources in the golf course become available to make repayment s in the future, those repayments of this contingent liability will take place, and will be recorded as transfers out from the Golf Course Fund at that time. 83 April 16, 2024
Item #2 Page 127 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 9: SIGNIFICANT COMMMITMENTS (CONTINUED)

C. Encumbrances

As of June 30, 2023, city commitments for outstanding encumbran ces (purchase orders and contracts for goods and services not yet delivered) by major governmental fund and nonmajor funds in the aggregate are as follows:

Outstanding
Encumbrances
Governmental activities
General fund 13,496,927 $
Communicty Facilities District No. 1 51,704
Infrastructure Replacement Fund 5,581,527
Park Development 1,669,411
Internal Service Funds 7,919,912
Non-major governmental funds 21,719,092
Subtotal - governmental activities 50,438,573
Business-type activities
Carlsbad Municipal Water District 14,117,973
Wastewater 2,945,096
Non-major enterprise funds 1,158,151
Subtotal - business-type activities 18,221,220
Total 68,659,793 $

NOTE 10: RISK MANAGEMENT

The city is exposed to various risks of loss related to its operations, including losses associated with errors and omissions and injuries to employees and members of the publ ic. The city uses a Risk Management Self-Insurance Fund and a Worker s’ Compensation Fund (all internal service funds) to account for and finance its uninsured risks of loss. All other funds of the city make payme nts to these funds based on annual estimates of the amounts needed to pay prior and current year claims and to establish a reserve for catastrophic losses.

Beginning July 1, 2019, the city joined the California Insuranc e Pool Authority (CIPA) f or excess general liability coverage. This coverage was pur chased directly through the pool ’s manager, Kiser & Company. Under this program, the city’s coverage is a maximum of $43,000,000 per oc currence with a self-insured retention of $1,000,000. CIPA has been in existence since 1978. At June 30, 2023, the unrestricted fund equity for the Risk Management Self- Insurance Fund was a $4,055,838 deficit. Funds used by the Risk Management Fund to liquidate the claims liability come from the General Fund (81.36%), the Water Fund (6.64%), the Solid Waste Fund (3.72%) and the Wastewater Fund (2.97%).

The city is self-insured for workers’ compensation claims for c laims up to $1,250,000 and insured by Safety National thereafter and up to statutory limits. At June 30, 202 3, the unrestricted fund equity for the Workers’ Compensation Self-Insurance Fund was $83,155. Funds used by the Workers’ Compensation Fund to liquidate the claims liability come from the General Fund (95.68%), the W ater Fund (1.59%) and the Wastewater fund (0.71%).

The estimated claims payable reported at June 30, 2023 is based on the requirements of GASB, which requires that a liability for claims be reported if information prior to the issuance of the financial statements indicates that it is probable that a liability has been incurred at the d ate of the financial statements and the amount of the loss can be reasonably estimated. Settled cases did not exceed insurance coverage during the past three fiscal years. All claims are considered non-current per their estimated settlement dates. 84 April 16, 2024
Item #2 Page 128 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 10: RISK MANAGEMENT (CONTINUED)

Changes in the estimated claims payable amounts in fiscal years 2021-22 and 2022-23 for the two internal service funds are as follows:

Expense and
Beginning Changes in Claim Ending
Balance Estimates Payments Balance
Risk Management Fund:
2021-22 3,621,368 $ 2,949,746 $ 1,901,288 $ 4,669,826 $ 2022-23 4,669,826 6,819,188 4,832,299 6,656,715 Workers' Compensation Fund:
2021-22 10,524,653 5,479,827 3,764,491 12,239,989 2022-23 12,239,989 14,186,202 4,523,773 21,902,418 Total
2021-22 14,146,021 8,429,573 5,665,779 16,909,815 2022-23 16,909,815 21,005,390 9,356,072 28,559,133 Claims

NOTE 11: LEASES AND SUBSCRIPTION -BASED INFORMATION TECHNOLOGY ARRANGEMENTS

A. Leases Payable

The city has entered into various lease agreements as lessee fo r the acquisition and use of buildings and land improvements. The terms of these leasing arrangements range from 8 to 12 years. As of June 30, 2023, the total value of the lease liability was $238,385. The city is required to make monthly principal and interest payments ranging from $2,787 to $3,284. The leases have interest rates ranging from 1.604% to 2.765%. Information on the lease assets as of June 30, 2023 are as follows:

Amount of
Leased Capital Accumulated
Major Class of Underlying Asset Assets Amortization
Buildings 238,606 $ 24,855 $
Land improvements 25,067 4,178
Total 263,673 $ 29,033 $
Governmental Activities

85 April 16, 2024
Item #2 Page 129 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 11: LEASES AND SUBSCRIPTION -BASED INFORMATION TECHNOLOGY ARRANGEMENTS (CONTINUED)

The future principal and interest lease payments as of June 30, 2023, were as follows:

Fiscal Year
Ending
June 30, Principal Interest Total
2024 27,395$ 6,045$ 33,440$
2025 29,068 5,294 34,362
2026 30,816 4,497 35,313
2027 32,641 3,651 36,292
2028 34,546 2,754 37,300
2029 - 2032 83,919 2,664 86,583 Totals 238,385$ 24,905$ 263,290$

B. Subscription-Based Information Technology Arrangements

The city implemented GASB Statement No. 96 in the fiscal year e nded June 30, 2023. The primary objective of this statement is to enhance the relevance and consistency of information about governments' subscription based-information technology arrangement (SBITA) activities. Th is statement establishes a single model for SBITA accounting based on the prin ciple that SBITAs are financi ngs of the right to use an underlying asset.

Under this Statement, a subscriber is required to recognize a s ubscription liability and an intangible right-to-use subscription asset, For additional information, refer to the disclosures below.

The city has entered into various SBITAs as the subscriber for the use of various software as services. An initial subscription liability was recorded in the amount of $1,845,563 during the current fiscal year. The terms of these subscriptions range from 13 months to 5 years. As of June 30, 2 023, the total value of the subscription liability was $2,928,584. The city is required to make annual payments ra nging from $2,600 to $670,888. The subscriptions have interest rates ranging from 1.85% to 3.378%. Information on the subscription assets as of June 30, 2023 are as follows:

Amount of
Leased Capital Accumulated
Major Class of Underlying Asset Assets Amortization
Software as a serv ice 4,854,577 $ 1,407,481 $
Governmental Activities

The future principal and interest lease payments as of June 30, 2023, were as follows:

Fiscal Year
Ending
June 30, Principal Interest Total
2024 1,568,813$ 75,104$ 1,643,917$
2025 1,260,574 39,858 1,300,432
2026 99,197 2,507 101,704
Totals 2,928,584$ 117,469$ 3,046,053$

86 April 16, 2024
Item #2 Page 130 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 12: LONG-TERM LIABILITIES

A. Private-Placement Loans

The city entered into private-placement loan agreements with th e State Water Resources Control Board to provide funds for the acquisition and construction of major cap ital facilities. These loans have been issued for the Carlsbad Municipal Water District. These loans are direct oblig ations and pledge the full faith and credit of the city. These loans pay principal and interest annually. Private- placement loans outstanding at June 30, 2023, are as follows:

Original Interest Final Outstanding
Borrowing Rates Maturity at Year-End
Business-type activ ities
Private-placement loan
2005 State Water Resources Control Board 4812-550-0 9,694,504$ 2.50% 2025 1,246,772$ 2006 State Water Resources Control Board 05-721-550-0 20,763,473 2.30% 2027 4,648,182 2014 State Water Resources Control Board 14820-550-0 22,150,000 1.00% 2054 4,897,215 Total private-placement loans 10,792,169$

B. Debt without Government Commitment

In the opinion of city officials, the bonds listed below are no t payable from any revenues or assets of the city, and neither the full faith and credit nor the taxing power of the city, the State of California, nor any political subdivision thereof, is obligated to the payment of the principal or intere st on the bond. Accordingly, no liability has been recorded in the accompanying financial statements.

1. Limited Obligation Improvement Bonds

As of June 30, 2023, the city has two series of assessment dist rict bonds outstanding in the amount of $17,905,000. These bonds were issued under the provisions of th e Improvement Bond Act of 1915 and were used to finance public infrastructure improvement projects. The city collects assessments to pay the bond debt.

These monies are accounted for in the assessment districts’ custodial funds.

2. Special Tax Bonds

As of June 30, 2023, the city has two series Community Faciliti es District (CFD) bonds outstanding in the amount of $16,315,000. These bonds were issued under the provisions of the Mello-Roos Community Facilities Act of 1982 and were used to finance public infrastructure improvement projects. The city collects special taxes to pay the bond debt. These monies are accounted for in the CFDs’ custodial funds.

3. Mortgage Revenue Bonds

Multi-Family Housing Revenue Bonds are issued to provide construction and permanent financing to developers of multi-family residential rent al projects located in the city which will be partially occupied by persons of low or moderate income. The total amount of mortgage revenue bonds out standing as of June 30, 2023 is $1,665,000.

The bonds, together with interest thereon, are limited obligati ons of the city payable solely from bond proceeds, revenues and other amounts derived solely from home mortgage an d developer loans secured by first deeds of trust, irrevocable letters of credit, and irrevocable surety bonds. 87 April 16, 2024
Item #2 Page 131 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 12: LONG-TERM LIABILITIES (CONTINUED)

C. Revenue Rate Covenants

The Carlsbad Municipal Water Di strict (CMWD) loan agreements wi th the State Water Resources Control Board requires that CMWD set its charges for services and rates for f ees each year at rates sufficient to produce net revenues (after paying the operating and maintenance expenses o f CMWD, excluding depreciation) of at least one times debt service for that year. All of the water revenues of CMWD are pledged to meet these rate covenants and to secure related debt. All rate covenants requirements were met for the fiscal year ended June 30, 2023.

D. Pledged Revenue

The city has a number of debt issuances outstanding that are co llateralized by the pledging of certain revenues.

The purpose for which the procee ds of the related debt issuances were utilized are disclosed in the debt descriptions of the accompanying notes. For the current year, d ebt service payments as a percentage of the pledged gross revenue (net of cert ain expenses where so require d by the debt agreement) are indicated in the table below. These percentages also approximate the relationshi p of debt service to pledged revenues for the remainder of the term of the commitment:

Description of Annual Amount of Pledged Annual Debt Pledged Revenue as Pledged Revenue Revenue (Net of Expenses) Service Payments a Percentage of Debt Water revenues 7,435,555$ 1,876,482$ 396%

E. Change in Long-Term Liabilities

Changes in the City’s long‐term liabilities for the year ended June 30, 2023, are as follows:

Balance Amount
July 1, 2022 Balance Due Within
As Restated Additions Deletions June 30, 2023 One Year
Governmental activities
Leases 22,377$ 238,606$ 22,598$ 238,385$ 27,395$ Subscriptions 1,845,563 3,009,014 1,925,993 2,928,584 1,568,813 Claims 16,909,815 21,005,390 9,356,072 28,559,133 13,822,294 Total governmental activities 18,777,755$ 24,253,010$ 11,304,663$ 31,726,102$ 15,418,502$ Business-type activities
Private-placement loans 12,443,537$ 46,778$ 1,698,146$ 10,792,169$ 1,738,405$

88 April 16, 2024
Item #2 Page 132 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 12: LONG-TERM LIABILITIES (CONTINUED)

The debt service requirements for the city’s loans are as follows:

June 30 Principal Interest
2024 1,738,405$ 138,077$
2025 1,779,619 96,863
2026 1,313,067 109,023
2027 1,341,472 80,681
2028 140,890 51,704
2029-2033 725,868 238,083
2034-2038 762,894 202,748
2039-2043 801,810 165,611
2044-2048 842,710 126,580
2049-2053 885,697 85,557
2054 459,737 22,271
Totals 10,792,169$ 1,317,198$
Business-Type Activ ities
Private-Placement Loans

NOTE 13: FUND BALANCE

A. General Fund Balance Policy

Pursuant to City Council Policy 74, the city is committed to maintaining General Fund reserves at a target of 40% of General Fund annual operating expenditures. The total reserve l evel is calculated using the prior fiscal years adopted General Fund budgeted expenditures. This reserve is for unforeseen emergencies or catastrophic impacts upon the city. Reserves are evaluated annually in conjunction w ith the development of the city’s annual operating budget process. Staff report to the City Council annually on the status of the reserve levels relative to this policy. 89 April 16, 2024
Item #2 Page 133 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 13: FUND BALANCE (CONTINUED)

B. Fund Balance Classifications

At June 30, 2023, the governmental funds report the following fund balance classifications:

Community Total Total
Facilities Infrastructure Park Nonmajor Governmental
General District No. 1 Replacement Development Funds Funds Nonspendable
Notes and loans receivable 381,635$ -$ -$ -$ -$ 381,635$ Inventories 12,110 - - - - 12,110 Deposits 200,432 - - - - 200,432 Prepaid costs 36,973 - - - 378,021 414,994 Advances to other funds 1,167,725 - - - - 1, 167,725 Total nonspendable 1,798,875 - - - 378,021 2,176,896 Restricted
Affordable housing - - - - 41,800,556 41,800,556 Lighting and landscaping districts - - - - 9, 897,059 9,897,059 Capital projects - 95,730,668 - 8,928,517 87,970,226 192,629,411 General government - - - - 701,325 701,325 Public safety - - - - 602,264 602,264 Community serv ices - - - - 3, 599,267 3,599,267 Tot
al restricted - 95,730,668 - 8,928,517 144,570,697 249,229,882 Committed
Community activity grants 1,000,000 - - - - 1, 000,000 Total committed 1,000,000 - - - - 1, 000,000 Assigned
General government 1,253,768 - - - - 1, 253,768 Public safety 7,911,636 - - - - 7, 911,636 Community serv ices 4,563,010 - - - - 4, 563,010 Public works 2,753,938 - - - - 2, 753,938 Capital projects - - 111,257,215 - 47,030,612 158,287,827 Risk management 5,000,000 - - - - 5, 000,000 Workers' compensation 1,300,000 - - - - 1, 300,000 Safer streets emergency 791,734 - - - - 791,734 Economic uncertainty 9,635,909 - - - - 9, 635,909 Pension trust 10,000,000 - - - - 10, 000,000 Total assigned 43,209,995 - 111,257,215 - 47,030,612 201,497,822 Unassigned 136,840,376 - - - (14,614) 136,825,762 Total fund balances (deficits) 182,849,246$ 95,730,668$ 111,257,215$ 8,928,517$ 191,964,716$ 590,730,362$

90 April 16, 2024
Item #2 Page 134 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 14: INTERFUND ACTIVITIES

A. Interfund Receivables and Payables

The composition of interfund balances as of June 30, 2023, is as follows:

1. Due to/from Other Funds

Receivable Fund Payable Fund Amount
Nonmajor governmental funds Nonmajor governmental funds 24,002$

The outstanding balances between funds result from the time lag between the dates that (1) interfund goods and services are provided or reimbursable expenditures occur, (2) t ransactions are recorded in the accounting system, and (3) payments between funds are made. The due to/fro m other funds is between the Affordable Housing Fund and the Tyler Court Apartments Fund, both non-majo r governmental funds, represents amounts due to the Affordable Housing Fund by the Tyler Court Apartment s Fund. The Affordable Housing Fund temporarily provided funds in order to expedite critical improvements at Tyler Court Apar tments. Costs were later reimbursed under the federal Community Development Block Grant (CDBG) program and the due to/from was removed.

2. Advances to/from Other Funds

Receivable Fund Payable Fund Amount
General Fund Nonmajor governmental funds 1,167,725$
Community Facilities District #1 Nonmajor governmental funds 901,024 Nonmajor governmental funds Park Development 5,650,000
Total 7,718,749$

Advances to and from other funds are primarily long-term advanc es used to fund capital projects in advance of related revenues.

The advance between the General Fund and the Habitat & Agricult ural Management Fund, a non-major governmental fund, is estimated to be repaid from future Habita t Mitigation Fees. Interest on the advance will compound annually at the average interest rate earned by the Treasurer’s Pool during the fiscal year.

The advance between the CFD No. 1 Fund and the Traffic Impact Projects Fund, a non-major governmental fund, is estimated to be repaid over a 10–15-year period as Traffic Impact Fees are collected.

The advance between the non-major Public Facilities Fees Fund a nd the major Park Development Funds is estimated to be repaid at build-out.
91 April 16, 2024
Item #2 Page 135 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 14: INTERFUND ACTIVITIES (CONTINUED)

B. Interfund Transfers

Transfers in and out of other funds

Transfers In Transfers Out Amount
Infrastructure Replacement Fund General Fund 3,956,000$ Nonmajor governmental funds General Fund 9,312,000
Nonmajor governmental funds Nonmajor governmental funds 160,000 Nonmajor enterprise funds General Fund 332,000
Internal service funds General Fund 10,608,252
24,368,252$

Transfers are used to: (1) move revenues and expenditures to th e appropriate funds; (2) use unrestricted revenues collected in the General Fund to finance various progr ams accounted for in other funds in accordance with Council authorizations; and (3) move excess cash collected for future capital replacement in accordance with Council authorization.

The $3,956,000 transfer to the Infrastructure Replacement Fund from the General Fund is to fund major construction and replacement of city infrastructure and facilities. This transfer is in line with the requirements set forth in City Council Policy No. 91-Long Term General Fund Capital Funding Policy.

The $9,312,000 transfer is split to three special revenue funds, all of which are nonmajor governmental funds, from the General Fund. These transfers include, $3,956,000 to the General Capital Construction Fund to fund major new construction of city infrastructure and facilities, $3,956,000 to the Technology Investment Capital Fund to fund major technology projects and $1,400,000 to the Financi ng Districts Fund to cover annual operating expenditures in excess of annual assessments on the city’s median and street tree assessment districts.

The $160,000 transfer between the non-major governmental funds represents two transfers, one transfer of $100,000 from the Affordable Housing Fund to the Housing Choice Voucher Fund to cover cash shortfalls in the Housing Choice Voucher program due to timing and receipt of federal funding and one transfer of $60,000 from the Affordable Housing Fund to the Tyler Court Apartment Fund i n order to cover a month of operating expenses due to revenue shortfalls.

The $332,000 transfer to the Solid Waste Fund, a non-major ente rprise fund, from the General Fund is to reimburse the Solid Waste Fund for the General Fund’s portion of annual storm water expenses.

The $10,608,252 transfer to internal service funds from the Gen eral Fund represents three transfers from the General Fund which include: $8,208,252 to the Worker’s Compensa tion Internal Service Fund to increase the estimated claims liability in accordance with recent actuarial reports, $1,000,000 to the Risk Management Internal Service Fund to bring the fund out of a fund deficit and $1,400 ,000 to the Fleet Management Internal Service Fund to establish a healthy minimum fund balance and address recent increases in fuel and parts costs. 92 April 16, 2024
Item #2 Page 136 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 15: CONTINGENCIES

The city participates in various federal grant programs, the pr incipal of which are subject to program compliance audits pursuant to the Single Audit Act as amended. Accordingly , the city’s compliance with applicable grant requirements will be established at a future date. The amount o f expenditures which may be disallowed by the granting agencies cannot be determined at this time, although t he city anticipates such amounts, if any, will be immaterial.

The city is a defendant in various lawsuits. Although the outco me of these lawsuits is not presently determinable, in the opinion of the city’s legal counsel, the resolution of t hese matters will not have a material adverse effect on the financial condition of the city.

NOTE 16: PRIOR PERIOD ADJUSTMENTS

A. Changes to or within the Reporting Entity

The Park Development fund was previously reported as a nonmajor governmental fund during the prior fiscal year. Due to a significant increase in liabilities of the fund during the year, it met the requirements of being presented as a major fund, in ac cordance with GASB Statement No . 34, during the fiscal year ended June 30, 2023. The effects of that change to or within the financial reporting entity are shown in the table below.

The Bridge Thoroughfare Districts (BTD) fund was previously rep orted as a major governmental fund during the prior fiscal year. Due to a significant decrease in assets and liabilities of the fund during the year, it no longer met the requirements of being presented as a major fund, in accorda nce with GASB Statement No. 34, during the fiscal year ended June 30, 2023. The effects of that change to or within the financial reporting entity are shown in the table below.

B. Change in Accounting Principle

For the fiscal year ended June 30, 2023, the city adjusted the liability balance of the cust odial funds to reclassify the net assets held for the payment of future conduit debt serv ice payments as a liabilit y (due to bondholders).

This adjustment was in accordance with new information provided to the city from the GASB during the fiscal year in response to a technical inquiry from the city’s auditors. The effect of this change is shown in the table below. 93 April 16, 2024
Item #2 Page 137 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 16: PRIOR PERIOD ADJUSTMENTS (CONTINUED)

C. Adjustments to and Restat ements of Beginning Balances

During fiscal year 2023, changes to or within the financial rep orting entity and the change in accounting principle resulted in adjustments to and restatements of beginning net position and fund net position, as follows:

June 30, 2022 Changes to or Changes in
As Previously within the Error Accounting June 30, 2022 Reported Reporting Entity Correction Principle As Restated Governmental funds
Major funds
General Fund 162,138,611$ -$ -$ -$ 162,138,611$ Bridge Thoroughfare Districts (BTD) (885,039) 885,039 - - - Community Facilities District #1 93,823,522 - - - 93,823,522 Infrastructure Replacement Fund 113,164,506 - - - 113,164,506 Park Development - 8,433,601 - - 8,433,601 Nonmajor funds 206,773,483 (9,318,640) - - 197,454,843 Total governmental funds 575,015,083$ -$ -$ -$ 575,015,083$ Fiduciary funds
Private-purpose trust fund 3,704,732$ -$ -$ -$ 3,704,732$ Custodial funds 14,020,514 - - (8,549,104) 5,471,410 Total fiduciary funds 17,725,246$ -$ -$ (8,549,104)$ 9,176,142$

NOTE 17: JOINT VENTURES

A. Encina Water Pollution Control Facilities

The Encina Water Pollution Control Facilities (the facilities) are wastewater facilities owned jointly by the cities of Carlsbad, Vista and Encinita s and the Leucadia Wastewater Di strict, the Buena Vista Sanitation District, and the Vallecitos Water District. The Encina Wastewater Author ity (EWA) is a joint powers authority established to operate and administer the fa cilities. It is responsible for the management, maintenance, and operations of the joint system. Each member agency has a specified percentage of ownership in the various components of the Encina Water Pollution Control Facilities that varies from component to component. Accordingly, each member agency reports its undivided interest in the facilities as a part of that member agency’s capital assets.

As of June 30, 2023, the undivided interest of each member agen cy in the various components of the Encina Water Pollution Control Facilities aggregated as follows:

City of Vista
25%
City of Carlsbad 24%
Vallecitos Water District 23%
Leucadia Wastewater District 17%
Buena Sanitation District 7%
City of Encinitas 4%

EWA does not recognize net income or loss. Net operating expend itures in excess of users’ assessments are treated as accounts receivable on EWA’s books and charged to us ers’ accounts in the following year.

Conversely, users’ assessments in excess of net operating expen ditures are treated as a liability and credited against users’ accounts, also in the following year. Under this basis, net operating loss (before member billings) for EWA totaled $5,278 in fiscal year 2021-22. The financial statements of EWA can be obtained at www.encinajpa.com.
94 April 16, 2024
Item #2 Page 138 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 18: SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER DEVELOPMEN T AGENCY

On December 29, 2011, the California Supreme Court upheld Assem bly Bill 1X 26 (“the bill”) which provides for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the city that previously had reported a redevelopment agency wi thin the reporting entity of the city as a blended component unit. The bill provides that upon dissolution of a redevelopment agency, either the city or another unit of local government will agree to serve as the “successor agenc y” to hold the assets until they are distributed to other units of state and local government. On January 10, 2012, the City Council elected to become the Successor Agency for the former redevelopment agency in accordance with the bill as part of City Council Resolution No. 2012-013 and Housing and Redevelopment Commission Resolution No. 519.

After enactment of the law, whi ch occurred on June 28, 2011, redevelopment agencies in the State of California cannot enter into new projects, obligations, or commitments. Su bject to the control of a newly established oversight board, remaining assets can only be used to pay enfor ceable obligations in existence at the date of the dissolution (including the completion of any unfinished project s that were subject to legally enforceable contractual commitments). In future years, successor agencies will only be allowed revenue in the amount that is necessary to pay the estimated annual installment payments on e nforceable obligations of the former redevelopment agency until all enforceable obligations of the p rior redevelopment agency have been paid in full and all assets have been liquidated. On March 7, 2014, the city received notice from the California Department of Finance that the loans previously made by the city to the forme r redevelopment agency are enforceable obligations and that they were made for legitimate redevelopmen t purposes. This approval allowed the city to list repayment of these loans on future Redevelopment Obligation Payment Schedules (ROPS). In accordance with the timeline set forth in the bill (as modified by the Californ ia Supreme Court on December 29, 2011) all redevelopment agencies in the State of California were dissolve d and ceased to operate as legal entities as of February 1, 2012.

A. Long-Term Debt

The following is a summary of changes in the principal balance of long-term debt for the year ended June 30, 2023:

Amount
Balance Balance Due Within
July 1, 2022 Additions Deletions June 30, 2023 One Year Bonds payable
Bonds payable 1,950,000 $ - $ 950,000$ 1,000,000 $ 1,000,000 $

The 1993 Carlsbad Housing and Redevelopment Commission Tax Allocation Bonds were issued totaling $15,495,000. Principal is due in amounts ranging from $900,000 to $1,000,000 on September 1 of each year through 2024. Interest is payable on March 1 and September 1 at a rate of 5.30% per annum. The city posted a surety bond in lieu of a cash reserve in the amount of $1,055,9 53. Bonds are payable from redevelopment property tax increment revenues and interest income.

The aggregate maturities of long-term debt are as follows:

June 30 Principal Interest
2024 1,000,000$ 104,675$

95 April 16, 2024
Item #2 Page 139 of 244

CITY OF CARLSBAD
Notes to the Financial Statements
Year Ended June 30, 2023

NOTE 18: SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER DEVELOPMEN T AGENCY (CONTINUED)

B. Pledged Revenue

The Successor Agency has a debt issuance outstanding that is collateralized by the pledging of certain revenues.

The amount and term of the remainder of this commitment is indi cated in the debt service to maturity table presented above. The purpose for wh ich the proceeds of the rela ted debt issuance was utilized is disclosed in the debt description on the previous page. For the current year, debt service payments as a percentage of pledged gross revenue (net of certain expenses wh ere so required by the debt agreement) are indicated in the table below. This percentage also approximates the relationship of debt service to pledged revenues for the remainder of the term of the commitment:

Debt Serv ice as a
Description of Annual Amount of Annual Debt Percentage of Pledged Revenue Pledged Revenue Service Payments Pledged Revenue Tax increment 1,061,683$ 1,028,175 $ 97%

NOTE 19: SUBSEQUENT EVENTS

The City evaluated subsequent events for recognition and disclo sure through March 26, 2024, the date on which these financial statements were available to be issued. Management concluded that the following subsequent events have occurred since June 30, 2023, that required disclosure in these financial statements.

• The City Council approved the establishment of a Public Agenci es Post-Employment Benefits Trust (Section 115 Trust) on September 12, 2023. This trust allows the city to stabilize pension cost volatility, maintain local control over the city’s assets and earn a potentially higher rate of return than if the assets were kept within the General Fund. The City Council approved an initial trust contribution of $10 million on September 26, 2023 as part of an ongoing effort to maintain compliance with City Coun cil Policy Statement No. 86 and the city’s minimum 80% pension funded ratio.

• In January 2024, the city experienced heavy rains and storm ev ents that caused flooding and landslides impacting certain private properties throughout the city. As a result of the disaster, the city incurred an additional $4,000,000 liability for damage repair. This liabili ty is expected to be liquidated during fiscal year 2023-2024.

96 April 16, 2024
Item #2 Page 140 of 244

Required Supplementary
Information

April 16, 2024
Item #2 Page 141 of 244

April 16, 2024
Item #2 Page 142 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Taxes 174,204,000$ 174,204,000$ 193,235,077$ 19,031,077$ Licenses and permits 2,313,000 3,614,438 3,710,466 96,028 Intergovernmental 1,154,309 1,322,512 2,456,236 1,133,724 Charges for services 9,210,767 9,210,767 10,833,054 1,622,287 Use of money and property 5,494,500 5,494,500 7,069,605 1,575,105 Fines and forfeitures 180,000 180,000 390,400 210,400 Contributions 38,500 38,500 20,233 (18,267) Miscellaneous 1,038,211 1,064,567 1,907,690 843,123 Total revenues 193,633,287 195,129,284 219,622,761 24,493,477

EXPENDITURES
Current:

General government 28,195,864 27,631,312 22,975,577 4,655,735 Less: interdepartmental charges (5,236,449) (5,236,449) (5,991,590) 755,141 Public safety 90,674,321 90,536,373 85,437,538 5,098,835 Community development 53,633,997 54,917,245 48,705,129 6,212,116 Public works 25,918,939 26,097,037 22,265,076 3,831,961 Capital outlay 6,138,428 6,152,522 1,336,186 4,816,336 Total expenditures 199,325,100 200,098,040 174,727,916 25,370,124 Excess (deficiency) of revenues
over (under) expenditures (5,691,813) (4,968,756) 44,894,845 49,863,601

OTHER FINANCING SOURCES (USES)
Transfers in 10,000 10,000 - (10,000) Proceeds from sale of capital asset - - 24,042 24,042 Transfers out (13,603,000) (24,208,252) (24,208,252) - Total other financing sources (uses) (13,593,000) (24,198,252) (24,184,210) 14,042 Net change in fund balance (19,284,813)$ (29,167,008)$ 20,710,635 49,877,643$ Fund balance-beginning 162,138,611
Fund balance-ending 182,849,246$

CITY OF CARLSBAD
General Fund
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
97 April 16, 2024
Item #2 Page 143 of 244

CITY OF CARLSBAD
Schedule of Changes in Net Pension Liability and Related Ratios Miscellaneous Plan
As of June 30, for the Last Ten Fiscal Years 1
2023 2022 2021 2020
Measurement Date 6/30/2022 6/30/2021 6/30/2020 6/30/2019

TOTAL PENSION LIABILITY
Service cost 8,937,350$ 8,267,207$ 7,748,623$ 7,393,365$ Interest on total pension liability 30,675,372 29,773,920 28,392,127 27,175,110 Changes of assumptions 13,648,298 - - - Difference between expected and actual experience (1,847,457) 3,459,759 1,167,225 2,338,341 Benefit payments, including refunds of employee
contributions (22,572,119) (21,477,657) (19,590,424) (18,193,803) Net change in total pension liability 28,841,444 20,023,229 17,717,551 18,713,013 Total pension liability-beginning 439,587,141 419,563,912 401,846,361 383,133,348 Total pension liability-ending (a) 468,428,585 439,587,141 419,563,912 401,846,361

PLAN FIDUCIARY NET POSITION
Contributions-employer 14,517,690 16,551,765 10,637,969 17,745,975 Contributions-employee 3,756,998 3,436,290 3,338,003 3,040,423 Net investment income (30,545,136) 74,476,234 15,901,834 19,551,424 Benefit payments, including refunds of employee
contributions (22,572,119) (21,477,657) (19,590,424) (18,193,803) Net plan to plan resource movement - - - - Administrative expense (252,005) (331,533) (454,014) (214,173) Other miscellaneous income/(expense) - - - 670 Net change in fiduciary net position (35,094,572) 72,655,099 9,833,368 21,930,516 Plan fiduciary net position-beginning 404,540,402 331,885,303 322,051,935 300,121,419 Plan fiduciary net position-ending (b) 369,445,830 404,540,402 331,885,303 322,051,935 Net pension liability/(asset) (a) - (b) 98,982,755$ 35,046,739$ 87,678,609$ 79,794,426$ Plan fiduciary net position as a percentage of the
total pension liability 78.9% 92.0% 79.1% 80.1%
Covered payroll 44,068,269$ 43,884,424$ 42,138,677$ 39,130,545$ Plan net pension liability/(asset) as a percentage
of covered payroll 224.6% 79.9% 208.1% 203.9%
Notes to Schedule of Changes in the Net Pension Liability and Related Ratios:
1 Fiscal year 2015 was the first year of GASB Statement No. 68 implementation; therefore only nine years are shown.

Benefit Changes : The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the measurement date. However, offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes) that occurred after the valuation date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary.

Changes of Assumptions : Effective for 2023, the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. Projected returns for all asset classes are estimated, combined with risk estimates, and are used to project compound (geometric) returns over the long term. The discount rate used to discount liabilities was informed by the long-erm projected portfolio return. In addition, demographic assumptions and the inflation rate assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The accounting discount rate was

7.15% for measurement dates 2018 through 2022, 7.65% for measurement dates 2016 through 2017, and 7.50% for 2015. 98 April 16, 2024
Item #2 Page 144 of 244
2019 2018 2017 2016 2015
6/30/2018 6/30/2017 6/30/2016 6/30/2015 6/30/2014
7,642,062$ 7,836,970$ 6,836,445$ 6,674,982$ 6,908,307$ 25,874,546 25,085,808 24,192,948 23,142,961 21,793,340 (2,662,243) 20,988,178 - (5,737,798) - (3,023,977) (3,079,012) (2,605,228) 1,300,520 - (16,887,970) (15,327,609) (14,344,528) (12,791,734) (11,614,664) 10,942,418 35,504,335 14,079,637 12,588,931 17,086,983 372,190,930 336,686,595 322,606,958 310,018,027 292,931,044 383,133,348 372,190,930 336,686,595 322,606,958 310,018,027 22,114,923 14,677,334 9,562,926 8,434,882 8,004,157 3,005,761 2,820,046 2,833,466 2,703,715 3,039,951 22,720,698 26,893,994 1,330,196 5,362,753 35,526,156 (16,887,970) (15,327,609) (14,344,528) (12,791,734) (11,614,664) 3,388 (2,793) - (298,989) - (421,336) (356,827) (147,759) (273,288) - (800,124) - - - - 29,735,340 28,704,145 (765,699) 3,137,339 34,955,600 270,386,079 241,681,934 242,447,633 239,310,294 204,354,694 300,121,419 270,386,079 241,681,934 242,447,633 239,310,294 83,011,929$ 101,804,851$ 95,004,661$ 80,159,325$ 70,707,733$

78.3% 72.6% 71.8% 75.2% 77.2%
36,214,870$ 35,845,774$ 35,141,036$ 33,609,704$ 32,960,515$ 229.2% 284.0% 270.4% 238.5% 214.5%
99 April 16, 2024
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CITY OF CARLSBAD
Schedule of Changes in Net Pension Liability and Related Ratios Safety Plan
As of June 30, for the Last Ten Fiscal Years 1
2023 2022 2021 2020
Measurement Date 6/30/2022 6/30/2021 6/30/2020 6/30/2019

TOTAL PENSION LIABILITY
Service cost 8,397,439$ 7,535,523$ 6,578,451$ 6,317,755$ Interest on total pension liability 24,991,969 23,741,151 22,410,699 21,269,278 Changes of assumptions 13,165,149 - - - Difference between expected and actual experience 3,204,494 5,936,553 4,071,899 2,425,561 Benefit payments, including refunds of employee
contributions (18,607,148) (17,230,615) (16,362,437) (15,288,250) Net change in total pension liability 31,151,903 19,982,612 16,698,612 14,724,344 Total pension liability-beginning 350,937,662 330,955,050 314,256,438 299,532,094 Total pension liability-ending (a) 382,089,565 350,937,662 330,955,050 314,256,438

PLAN FIDUCIARY NET POSITION
Contributions-employer 13,322,734 14,253,531 10,321,371 23,119,896 Contributions-employee 3,020,571 2,861,027 2,581,027 2,380,740 Net investment income (23,360,492) 56,569,028 12,053,297 14,331,677 Benefit payments, including refunds of employee
contributions (18,607,148) (17,230,615) (16,362,437) (15,288,250) Net plan to plan resource movement - - - - Administrative expense (192,091) (251,893) (343,854) (156,656) Other miscellaneous income/(expense) - - - 508 Net change in fiduciary net position (25,816,426) 56,201,078 8,249,404 24,387,915 Plan fiduciary net position-beginning 308,361,275 252,160,197 243,910,793 219,522,878 Plan fiduciary net position-ending (b) 282,544,849 308,361,275 252,160,197 243,910,793 Net pension liability/(asset) (a) - (b) 99,544,716$ 42,576,387$ 78,794,853$ 70,345,645$ Plan fiduciary net position as a percentage of the
total pension liability 73.9% 87.9% 76.2% 77.6%
Covered payroll 25,604,904$ 26,392,461$ 24,695,745$ 22,328,023$ Plan net pension liability/(asset) as a percentage
of covered payroll 388.8% 161.3% 319.1% 315.1%
Notes to Schedule of Changes in the Net Pension Liability and Related Ratios:
1 Fiscal year 2015 was the first year of GASB Statement No. 68 implementation; therefore only nine years are shown.

Benefit Changes : The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the measurement date. However, offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes) that occurred after the valuation date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary.

Changes of Assumptions: Effective for 2023, the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. Projected returns for all asset classes are estimated, combined with risk estimates, and are used to project compound (geometric) returns over the long term. The discount rate used to discount liabilities was informed by the long-erm projected portfolio return. In addition, demographic assumptions and the inflation rate assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The accounting discount rate was

7.15% for measurement dates 2018 through 2022, 7.65% for measurement dates 2016 through 2017, and 7.50% for 2015. 100
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2019 2018 2017 2016 2015
6/30/2018 6/30/2017 6/30/2016 6/30/2015 6/30/2014
5,985,155$ 5,825,080$ 5,209,900$ 5,048,529$ 5,425,425$ 20,248,091 19,305,098 18,557,781 17,775,039 16,876,220 (1,332,336) 16,661,943 - (4,517,683) - 2,726,755 (705,417) (941,378) 638,786 - (13,797,333) (13,034,483) (12,197,119) (11,264,768) (10,529,479) 13,830,332 28,052,221 10,629,184 7,679,903 11,772,166 285,701,762 257,649,541 247,020,357 239,340,454 227,568,288 299,532,094 285,701,762 257,649,541 247,020,357 239,340,454 8,675,370 12,379,181 6,836,098 6,491,856 6,141,746 2,169,504 1,922,500 1,933,363 1,726,785 1,853,365 17,250,148 20,385,351 990,545 4,107,305 27,905,516 (13,797,333) (13,034,483) (12,197,119) (11,264,768) (10,529,479) (4,566) 2,793 - - - (321,256) (272,813) (114,168) (210,908) - (610,070) - - - - 13,361,797 21,382,529 (2,551,281) 850,270 25,371,148 206,161,081 184,778,552 187,329,833 186,479,563 161,108,415 219,522,878 206,161,081 184,778,552 187,329,833 186,479,563 80,009,216$ 79,540,681$ 72,870,989$ 59,690,524$ 52,860,891$

73.3% 72.2% 71.7% 75.8% 77.9%
20,768,094$ 18,965,085$ 18,514,525$ 18,378,393$ 18,013,144$ 385.3% 419.4% 393.6% 324.8% 293.5%
101
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CITY OF CARLSBAD
Schedule of Changes in Net OPEB Liability and Related Ratios As of June 30, for the Last Ten Fiscal Years 1
2023 2022 2021 2020
Measurement Date 6/30/2022 6/30/2021 6/30/2020 6/30/2019

TOTAL OPEB LIABILITY
Service cost 757,499 669,651 657,941 536,124 Interest on total OPEB liability 1,248,183 1,347,382 1,301,716 1,167,930 Changes of assumptions - 625,021 (281,685) 1,232,232 Difference between expected and actual experience - (922,167) - (203,116) Benefit payments, including refunds of employee
contributions (1,095,532) (1,074,741) (999,866) (887,656) Net change in total OPEB liability 910,150 645,146 678,106 1,845,514 Total OPEB liability-beginning 19,761,187 19,116,041 18,437,935 16,592,421 Total OPEB liability-ending (a) 20,671,337 19,761,187 19,116,041 18,437,935

PLAN FIDUCIARY NET POSITION
Contributions-employer 1,102,669 1,180,559 1,085,866 978,302 Net investment income (2,735,878) 4,387,820 541,912 887,132 Benefit payments, including refunds of employee
contributions (1,095,532) (1,074,741) (999,866) (887,656) Administrative expense (12,314) (11,858) (7,493) (3,078) Net change in fiduciary net position (2,741,055) 4,481,780 620,419 974,700 Plan fiduciary net position-beginning 20,443,852 15,962,072 15,341,653 14,366,953 Plan fiduciary net position-ending (b) 17,702,797 20,443,852 15,962,072 15,341,653 Net OPEB liability/(asset) (a) - (b) 2,968,540 (682,665) 3,153,969 3,096,282 Plan fiduciary net position as a percentage of the
total OPEB liability 85.6% 103.5% 83.5% 83.2%
Covered-employee payroll 90,161,596$ 70,276,885$ 66,834,422$ 61,458,568$ Plan net OPEB liability/(asset) as a percentage of
covered-employee payroll 3.3% -1.0% 4.7% 5.0%
Notes to Schedule of Changes in the Net OPEB Liability and Related Ratios:
1 Fiscal year 2018 was the first year of GASB Statement No. 75 implementation; therefore only six years are shown.

Benefit Changes : None
Changes of Assumptions : None
102
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2019 2018
6/30/2018 6/30/2017
520,509 505,348
1,113,646 1,064,137
- -
- -
(860,894) (893,899)
773,261 675,586
15,819,160 15,143,574
16,592,421 15,819,160
860,894 747,772
1,064,150 1,281,487
(860,894) (893,899)
(24,735) -
1,039,415 1,135,360
13,327,538 12,192,178
14,366,953 13,327,538
2,225,468 2,491,622

86.6% 84.2%
56,982,964$ 54,810,859$

3.9% 4.5%
103
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CITY OF CARLSBAD
Schedules of Plan Contributions
As of June 30, for the Last Ten Fiscal Years 1
Covered/ Contribution as a
Fiscal Year Actuarially Actual Contribution Covered- % of Covered/ Ending Determined Employer Deficiency Employee Covered Employee June 30, Contribution Contributions (Excess) Payroll Payroll 2023 12,680,481$ 12,800,872$ (120,391)$ 49,894,207$ 25.7% 2022 11,286,334 14,518,210 (3,231,876) 44,068,269 32.9% 2021 11,098,619 16,501,759 (5,403,140) 43,884,424 37.6% 2020 10,633,467 10,633,467 - 42,138,677 25.2% 2019 11,966,625 17,745,975 (5,779,350) 39,130,545 45.4% 2018 10,456,115 22,114,923 (11,658,808) 36,214,870 61.1% 2017 10,338,549 14,677,334 (4,338,785) 35,845,774 40.9% 2016 9,562,926 9,562,926 - 35,141,036 27.2% 2015 8,434,882 8,434,882 - 33,609,704 25.1% 2014 8,004,157 8,004,157 - 32,960,515 24.3% 2023 11,231,619$ 11,354,715$ (123,096)$ 29,505,416$ 38.5% 2022 10,144,367 13,344,367 (3,200,000) 25,604,904 52.1% 2021 9,656,334 14,253,194 (4,596,860) 26,392,461 54.0% 2020 10,323,721 10,323,721 - 24,695,745 41.8% 2019 8,899,136 23,119,790 (14,220,654) 22,328,023 103.5% 2018 8,658,116 8,658,116 - 20,768,094 41.7% 2017 7,695,135 12,379,181 (4,684,046) 18,965,085 65.3% 2016 6,836,098 6,836,098 - 18,514,525 36.9% 2015 6,491,856 6,491,856 - 18,378,393 35.3% 2014 6,141,746 6,141,746 - 18,013,144 34.1% 2023 791,699$ 1,153,114$ (361,415)$ 86,120,975$ 1.3% 2022 768,612 1,102,669 (334,057) 90,161,596 1.2% 2021 962,244 1,180,557 (218,313) 70,276,885 1.7% 2020 941,129 1,085,864 (144,735) 66,834,422 1.6% 2019 788,383 978,302 (189,919) 61,458,568 1.6% 2018 770,693 860,894 (90,201) 56,982,964 1.5% 1 Fiscal year 2018 was the first year of GASB Statement No. 75 implementation; therefore only six years are shown.

Miscellaneous Agent, Multiple-Employer Pension Plan
Safety Agent, Multiple-Employer Pension Plan
Agent, Multiple Employer OPEB Plan
See accompanying notes to required supplementary information. 104
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CITY OF CARLSBAD
Notes to the Required Supplementary Information
Year Ended June 30, 2023

NOTE 1: NOTES TO SCHEDULE OF PLAN CONTRIBUTIONS

A. Pension Plans

The actuarial methods and assumptions used to set the actuarially determined contributions for fiscal year 2022-23 were derived from the June 30, 2020 funding valuation reports, available at CalPERS’ website https://www.calpers.ca.gov/.

B. Other Postemployment Benefits Plan

The actuarial methods and assumptions used to set the actuarially determined contributions for fiscal year 2022-23 were derived from the June 30, 2021 actuarial valuation report.

Actuarial cost method: Entry age normal
Amortization method/period: For details, see June 30. 2020 Fundi ng Valuation Report Asset v aluation method: Market v alue of assets. For details, see June 30, 2020 Funding Valuation Report
Inflation: 2.50%
Salary increases: Varies by entry age and serv ice
Payroll growth: 2.75%
Inv estment rate of return: 7.00% net of inv estment and administr ative expenses Retirement age: The probabilities of retirement are based on the 2017 CalPERS Experience Study for the period from 1997-2015.

Mortality: The probabilities of mortality are based on the 2017 CalPERS Experience Study for the period from 1997-2015.

Pre-retirement and post-retirement mortality rates include 20 years of projected mortality improvements using Scale BB published by the Society of Actuaries
Actuarial cost method: Entry age normal, level percentage of pay Amortization method/period: Level dollar; 25-year fixed period f or 2022-23 Asset v aluation method: Market v alue of assets
Inflation: 2.50%
Salary increases: Varies by entry age and serv ice
Payroll growth: 2.75%
Investment rate of return: 6.25%
Medical trend: Non-Medicare - 6.50% for 2023, decreaseing to an ultimate rate of 3.75% in 2076. Medicare (non-Kaiser) - 5.65% in 2023, decreasing to an ultimate rate of 3.75% in 2076. Medicare (Kaiser) - 4.60% for 2023, decreasing to an ultimate rate of

3.75% in 2076.

Mortality: CalPERS 2000-2019 Experience Study, projected fully generational with Scale MP-2021.
105
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CITY OF CARLSBAD
Notes to the Required Supplementary Information
Year Ended June 30, 2023

NOTE 2: BUDGETARY INFORMATION

The City follows these procedures in establishing the budgetary data reflected in the financial statements:

• During May or June, the City Manager submits a proposed operat ing, strategic digital transformation investment program and capital improvement program budgets for the fiscal year commencing the following July 1 to the City Council. The budget includes estimated reven ues and proposed expenditures on a departmental and/or project basis.

• In June, a public hearing is conducted at a City Council meeti ng to obtain citizens’ comments.

• Prior to July 1, the budget is enacted legally through passage of an appropriation resolution.

• For purposes of budgetary presen tation, actual revenues have been adjusted to exclude unrealized gains and losses pursuant to GASB. Actual expenditures have been adjusted to include encumbrances outstanding.

Annual budgets are adopted for the General Fund, special revenue funds and capital project funds.

The City of Carlsbad does not distinguish between Basis of Budgeting and Basis of Accounting. The principles set forth as the Basis of Accounting are strictly observed in the budgeting process. A fund’s Basis of Budgeting and Basis of Accounting determines when a transaction or event is recognized; refer to Note 1 Summary of Significant Accounting Policies in the Notes to the Basic Financial Statements for more inform ation. Only revenues and expenditures anticipated during the fiscal year are included in the budget. All appropriations lapse at fiscal-year end unless the City Council takes action in the form of a resolution to continue the appropriation into the following fiscal year, or, if the appropriation is less than $100,000, the City Manager may approve to continue the appropriation into the following fiscal year.

Budgetary control, the level at which expenditures cannot legal ly exceed the appropriated amount, is at the fund level. Council and Administrative policies provide guidelines on budget transfers and the authorization necessary to implement transfers. Generally, there are two types of budget transfers:

• Budget adjustment: This is a transfer which does not change the total appropriat ed amount within a fund and does not require Council action. Approval is granted at the City Manager level.

• Budget amendment: This is an adjustment to the total appropriated amount within a fund or business unit which was not included in the original budget. Revisions that alter t he total appropriations of any fund must be approved by a simple majority of the City Council via a resolution with the exception of budget increases that involve offsetting revenues and expenditures. The City Manager is authorized to increase an appropriation for a specific purpose where the appropriation is offset by unbudge ted revenue, which is designated for said specific purpose.

106
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Combining and Individual Fund
Statements and Schedules

April 16, 2024
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April 16, 2024
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CITY OF CARLSBAD
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2023
ASSETS
Cash and investments 14,275,480$ 256,200$ 2,848,684$ 10,255,703$ Receivables (net of allowance for uncollectible):

Accounts - - - 8,307 Accrued interest 3,744,241 62,957 12,321 44,354 Due from other governments - - - - Grants - - - - Notes and loans 27,331,797 - - - Leases - 3,023,200 - - Other - - - 12,897 Due from other funds 24,002 - - - Inventories - - 3,814 - Prepaid costs - - - - Land held for resale - 442,800 - - Advances to other funds - - - - Total assets 45,375,520$ 3,785,157$ 2,864,819$ 10,321,261$

LIABILITIES
Accrued liabilities 970$ 40,764$ 17,197$ 424,202$ Due to other governments - - - - Deposits payable - - - - Due to other funds - - - - Advances from other funds - - - - Unearned revenues - - - - Total liabilities 970 40,764 17,197 424,202

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 3,682,496 - - - Lease-related - 2,992,748 - - Total deferred inflows of resources 3,682,496 2,992,748 - -

FUND BALANCES
Nonspendable - - - - Restricted 41,692,054 751,645 2,847,622 9,897,059 Assigned - - - - Unassigned - - - - Total fund balances 41,692,054 751,645 2,847,622 9,897,059 Total liabilities, deferred inflows of
resources, and fund balances 45,375,520$ 3,785,157$ 2,864,819$ 10,321,261$ Affordable
Housing
Community
Development
Block Grant Donations
Financing
Districts
Special Revenue Funds
107
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CITY OF CARLSBAD
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2023
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Accrued interest
Due from other governmentsGrants
Notes and loans
Leases
Other
Due from other funds
Inventories
Prepaid costs
Land held for resale
Advances to other funds
Total assets

LIABILITIES
Accrued liabilities
Due to other governments
Deposits payable
Due to other funds
Advances from other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Nonspendable
Restricted
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows of
resources, and fund balances
1,162,751$ 650,228$ 575,494$ 24,358$ - - - - 5,029 2,812 2,922 - - - 125,187 218,666 - - - - - - - - - - - - - 72,234 - - - - - - - - - - - - - - - - - - - - - - 1,167,780$ 725,274$ 703,603$ 243,024$ 4,795$ 23,949$ 30,540$ 13,598$ - - - 116,266 - - - 42,334 - - - - 1,167,725 - - - - - - - 1,172,520 23,949 30,540 172,198 - - 70,799 - - - - - - - 70,799 - - - - - - 701,325 602,264 70,826 - - - - (4,740) - - - (4,740) 701,325 602,264 70,826 1,167,780$ 725,274$ 703,603$ 243,024$ Other Special
Revenue
Funds
Police Grants
and Asset
Forfeiture
Section 8
Rental
Assistance
Habitat and
Agricultural
Management
Special Revenue Funds
108
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CITY OF CARLSBAD
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2023
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Accrued interest
Due from other governmentsGrants
Notes and loans
Leases
Other
Due from other funds
Inventories
Prepaid costs
Land held for resale
Advances to other funds
Total assets

LIABILITIES
Accrued liabilities
Due to other governments
Deposits payable
Due to other funds
Advances from other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Nonspendable
Restricted
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows of
resources, and fund balances
(Continued)
103,172$ 227,985$ 2,381,200$ 1,855,456$ - - - - - 987 10,300 8,025 - 106,062 - - - - - - - - - - - - - - 11,064 - - - - - - - - - - - 2,054 - - - - - - - - - - - 116,290$ 335,034$ 2,391,500$ 1,863,481$ 15,512$ -$ -$ -$ - - - - 37,046 - 426,179 - 24,002 - - - - - - - - 344,908 - - 76,560 344,908 426,179 - - - - - - - - - - - - - 2,054 - - - 37,676 - 1,965,321 1,863,481 - - - - - (9,874) - - 39,730 (9,874) 1,965,321 1,863,481 116,290$ 335,034$ 2,391,500$ 1,863,481$ Bridge
Thoroughfare
Districts (BTD)
Assessment
and Other
Districts
Tyler Court
Apartments
California
Opioid
Settlement
Special Revenue Funds Capital Projects Funds
109
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CITY OF CARLSBAD
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2023
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Accrued interest
Due from other governmentsGrants
Notes and loans
Leases
Other
Due from other funds
Inventories
Prepaid costs
Land held for resale
Advances to other funds
Total assets

LIABILITIES
Accrued liabilities
Due to other governments
Deposits payable
Due to other funds
Advances from other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Nonspendable
Restricted
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows of
resources, and fund balances
17,576,053$ 38,080,310$ 1,656,335$ 4,754,657$ - - - - 75,943 164,709 7,479 20,566 709,914 - 189,128 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 18,361,910$ 38,245,019$ 1,852,942$ 4,775,223$ 393,316$ 1,751,148$ 91,344$ 26,525$ - - - - - - - - - - - - - - - - - - - - 393,316 1,751,148 91,344 26,525 - - 127,418 - - - - - - - 127,418 - - - - - 17,968,594 - 1,634,180 4,748,698 - 36,493,871 - - - - - - 17,968,594 36,493,871 1,634,180 4,748,698 18,361,910$ 38,245,019$ 1,852,942$ 4,775,223$ Planned Local
Drainage
Facilities Gas Tax
General
Capital
Construction
Grants and
Other Capital
Project Funds
Capital Projects Funds
110
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CITY OF CARLSBAD
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2023
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Accrued interest
Due from other governmentsGrants
Notes and loans
Leases
Other
Due from other funds
Inventories
Prepaid costs
Land held for resale
Advances to other funds
Total assets

LIABILITIES
Accrued liabilities
Due to other governments
Deposits payable
Due to other funds
Advances from other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Nonspendable
Restricted
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows of
resources, and fund balances
(Continued)
28,004,362$ 7,396,371$ 19,992,845$ 10,573,157$ - - - - 121,127 31,857 86,475 45,732 - 134,610 - - - - - - - - - - - - - - - 83,325 - - - - - - - - - - - - - 375,967 - - - - 5,650,000 - - - 33,775,489$ 7,646,163$ 20,079,320$ 10,994,856$ 20,766$ 205,734$ 448,886$ 82,148$ - - - - - - - - - - - - - - 901,024 - - - - - 20,766 205,734 1,349,910 82,148 - 134,610 - - - - - - - 134,610 - - - - - 375,967 33,754,723 7,305,819 18,729,410 -
- - - 10,536,741 - - - - 33,754,723 7,305,819 18,729,410 10,912,708 33,775,489$ 7,646,163$ 20,079,320$ 10,994,856$ Public
Facilities
Construction
Sales
Tax/TransNet
Traffic Impact
Projects
Technology
Investment
Capital
Capital Projects Funds
111
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CITY OF CARLSBAD
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2023
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Accrued interest
Due from other governmentsGrants
Notes and loans
Leases
Other
Due from other funds
Inventories
Prepaid costs
Land held for resale
Advances to other funds
Total assets

LIABILITIES
Accrued liabilities
Due to other governments
Deposits payable
Due to other funds
Advances from other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Nonspendable
Restricted
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows of
resources, and fund balances
Total
Nonmajor
Funds
162,650,801$
8,307
4,447,836
1,483,567 -
27,331,797
3,023,200
179,520
24,002
3,814
378,021
442,800
5,650,000
205,623,665$
3,591,394$
116,266
505,559
24,002
2,068,749
344,908
6,650,878
4,015,323
2,992,748
7,008,071
378,021
144,570,697
47,030,612
(14,614)
191,964,716
205,623,665$
Capital Projects Funds
112
April 16, 2024
Item #2 Page 160 of 244

CITY OF CARLSBAD
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2023

REVENUES
Taxes -$ -$ -$ -$ Intergovernmental - 508,874 - - Contribution from property owners 248,039 - - - Charges for services 25,427 - 11,352 2,535,209 Use of money and property 787,264 275,514 35,284 46,883 Contributions - - 293,624 - Miscellaneous - - 13,915 1,440 Total revenues 1,060,730 784,388 354,175 2,583,532

EXPENDITURES
Current:

General government - - - - Public safety - - - - Community services 357,704 2,298,679 399,979 2,318,800 Public works - - - 1,403,122 Capital outlay - - - - Debt service:

Interest and fiscal charges - - - - Total expenditures 357,704 2,298,679 399,979 3,721,922 Excess (deficiency) of revenues
over (under) expenditures 703,026 (1,514,291) (45,804) (1,138,390)

OTHER FINANCING SOURCES (USES)
Transfers in - - - 1,400,000 Transfers out (160,000) - - - Proceeds from sale of capital asset - 355,302 - - Total other financing sources (uses) (160,000) 355,302 - 1,400,000 Net change in fund balances 543,026 (1,158,989) (45,804) 261,610 Fund balances-beginning, restated 41,149,028 1,910,634 2,893,426 9,635,449 Fund balances-ending 41,692,054$ 751,645$ 2,847,622$ 9,897,059$ Affordable
Housing
Community
Development
Block Grant Donations
Financing
Districts
Special Revenue Funds
113
April 16, 2024
Item #2 Page 161 of 244

CITY OF CARLSBAD
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2023

REVENUES
Taxes
Intergovernmental
Contribution from property owners
Charges for services
Use of money and property
Contributions
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Public safety
Community services
Public works
Capital outlay
Debt service:

Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues
over (under) expenditures

OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Proceeds from sale of capital asset
Total other financing sources (uses)
Net change in fund balances
Fund balances-beginning, restated
Fund balances-ending
-$ -$ -$ -$ - - 475,881 10,617,494 57,082 284,652 - - - - - - 15,330 12,653 5,014 5,920 - - - - - - - 5,240 72,412 297,305 480,895 10,628,654 - 402,241 - - - - 402,883 - 38,220 - - 10,854,742 - - - - - - 122,291 - 22,365 - - - 60,585 402,241 525,174 10,854,742 11,827 (104,936) (44,279) (226,088) - - - 100,000 - - - - - - - - - - - 100,000 11,827 (104,936) (44,279) (126,088) (16,567) 806,261 646,543 196,914 (4,740)$ 701,325$ 602,264$ 70,826$ Habitat and
Agricultural
Management
Other Special
Revenue
Funds
Police Grants
and Asset
Forfeiture
Section 8
Rental
Assistance
Special Revenue Funds
114
April 16, 2024
Item #2 Page 162 of 244

CITY OF CARLSBAD
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2023

REVENUES
Taxes
Intergovernmental
Contribution from property owners
Charges for services
Use of money and property
Contributions
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Public safety
Community services
Public works
Capital outlay
Debt service:

Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues
over (under) expenditures

OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Proceeds from sale of capital asset
Total other financing sources (uses)
Net change in fund balances
Fund balances-beginning, restated
Fund balances-ending
(Continued)
-$ -$ -$ -$ - - - 2,174,230 - - - - 802,680 - - - 2,186 (9,874) 37,011 631,331 - - - - - - - - 804,866 (9,874) 37,011 2,805,561 - - - - - - - - 529,497 - - - - - 1,015,672 - 363,864 - - 57,041 - - - - 893,361 - 1,015,672 57,041 (88,495) (9,874) (978,661) 2,748,520 60,000 - - - - - - - - - - - 60,000 - - - (28,495) (9,874) (978,661) 2,748,520 68,225 - 2,943,982 (885,039) 39,730$ (9,874)$ 1,965,321$ 1,863,481$ Tyler Court
Apartments
California
Opioid
Settlement
Assessment
and Other
Districts
Bridge
Thoroughfare
Districts (BTD)
Special Revenue Funds Capital Projects Funds
115
April 16, 2024
Item #2 Page 163 of 244

CITY OF CARLSBAD
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2023

REVENUES
Taxes
Intergovernmental
Contribution from property owners
Charges for services
Use of money and property
Contributions
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Public safety
Community services
Public works
Capital outlay
Debt service:

Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues
over (under) expenditures

OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Proceeds from sale of capital asset
Total other financing sources (uses)
Net change in fund balances
Fund balances-beginning, restated
Fund balances-ending
5,520,836$ -$ -$ -$ - - 61,709 - - - - 185,869 - - - - 271,555 (1,701,774) 21,450 45,029 - - - - - 2,013,865 - - 5,792,391 312,091 83,159 230,898 - - - - - - - - - - - - 600,000 - 53,000 - 6,429,728 10,306,345 167,146 61,972 - - - - 7,029,728 10,306,345 220,146 61,972 (1,237,337) (9,994,254) (136,987) 168,926 - 3,956,000 - - - - - - - - - - - 3,956,000 - - (1,237,337) (6,038,254) (136,987) 168,926 19,205,931 42,532,125 1,771,167 4,579,772 17,968,594$ 36,493,871$ 1,634,180$ 4,748,698$ Gas Tax
General
Capital
Construction
Grants and
Other Capital
Project Funds
Capital Projects Funds
Planned Local
Drainage
Facilities
116
April 16, 2024
Item #2 Page 164 of 244

CITY OF CARLSBAD
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2023

REVENUES
Taxes
Intergovernmental
Contribution from property owners
Charges for services
Use of money and property
Contributions
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Public safety
Community services
Public works
Capital outlay
Debt service:

Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues
over (under) expenditures

OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Proceeds from sale of capital asset
Total other financing sources (uses)
Net change in fund balances
Fund balances-beginning, restated
Fund balances-ending
(Continued)
-$ -$ -$ -$ - 429,466 - - 1,196,210 - 1,654,082 - - 954,794 - - 385,758 172,004 253,549 21,059 - - - - - - - - 1,581,968 1,556,264 1,907,631 21,059 - - - - - - - - - - - - - - - - 1,304,479 3,256,940 1,903,324 1,872,511 - - - - 1,304,479 3,256,940 1,903,324 1,872,511 277,489 (1,700,676) 4,307 (1,851,452) - - - 3,956,000 - - - - - - - - - - - 3,956,000 277,489 (1,700,676) 4,307 2,104,548 33,477,234 9,006,495 18,725,103 8,808,160 33,754,723$ 7,305,819$ 18,729,410$ 10,912,708$ Sales
Tax/TransNet
Traffic Impact
Projects
Technology
Investment
Capital
Capital Projects Funds
Public
Facilities
Construction
117
April 16, 2024
Item #2 Page 165 of 244

CITY OF CARLSBAD
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2023

REVENUES
Taxes
Intergovernmental
Contribution from property owners
Charges for services
Use of money and property
Contributions
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Public safety
Community services
Public works
Capital outlay
Debt service:

Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues
over (under) expenditures

OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Proceeds from sale of capital asset
Total other financing sources (uses)
Net change in fund balances
Fund balances-beginning, restated
Fund balances-ending
Total
Nonmajor
Funds
5,520,836$
14,267,654
3,625,934
4,329,462
1,313,146
293,624
2,034,460
31,385,116
402,241
402,883
16,797,621
3,071,794
25,845,641
22,365
46,542,545
(15,157,429)
9,472,000
(160,000)
355,302
9,667,302
(5,490,127)
197,454,843
191,964,716$
118
April 16, 2024
Item #2 Page 166 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Contribution from property owners 120,000$ 120,000$ 248,039$ 128,039$ Charges for services 30,000 30,000 25,427 (4,573) Use of money and property 345,000 345,000 787,264 442,264 Total revenues 495,000 495,000 1,060,730 565,730

EXPENDITURES
Current:

Community services 293,695 444,695 357,704 86,991 Total expenditures 293,695 444,695 357,704 86,991 Excess (deficiency) of revenues
over (under) expenditures 201,305 50,305 703,026 652,721

OTHER FINANCING SOURCES (USES)
Transfers out (100,000) (410,000) (160,000) (250,000) Total other financing sources (uses) (100,000) (410,000) (160,000) (250,000) Net change in fund balance 101,305$ (359,695)$ 543,026 402,721$ Fund balance-beginning 41,149,028
Fund balance-ending 41,692,054$

CITY OF CARLSBAD
Affordable Housing
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
119
April 16, 2024
Item #2 Page 167 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental 527,154$ 2,314,329$ 508,874$ (1,805,455)$ Use of money and property - - 275,514 275,514 Total revenues 527,154 2,314,329 784,388 (1,529,941)

EXPENDITURES
Current:

Community services 739,241 3,147,606 2,298,679 848,927 Total expenditures 739,241 3,147,606 2,298,679 848,927 Excess (deficiency) of revenues
over (under) expenditures (212,087) (833,277) (1,514,291) (681,014)

OTHER FINANCING SOURCES (USES)
Sales of general capital assets - - 355,302 355,302 Total other financing sources (uses) - - 355,302 355,302 Net change in fund balance (212,087)$ (833,277)$ (1,158,989) (325,712)$ Fund balance-beginning 1,910,634
Fund balance-ending 751,645$

CITY OF CARLSBAD
Community Development Block Grant
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
120
April 16, 2024
Item #2 Page 168 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Charges for services 8,000$ 8,000$ 11,352$ 3,352$ Use of money and property 17,139 17,139 35,284 18,145 Contributions 300,800 300,800 293,624 (7,176) Miscellaneous 12,000 12,000 13,915 1,915 Total revenues 337,939 337,939 354,175 16,236

EXPENDITURES
Current:

Community services 737,728 737,728 399,979 337,749 Total expenditures 737,728 737,728 399,979 337,749 Net change in fund balance (399,789)$ (399,789)$ (45,804) 353,985$ Fund balance-beginning 2,893,426
Fund balance-ending 2,847,622$

CITY OF CARLSBAD
Donations
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
121
April 16, 2024
Item #2 Page 169 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Charges for services 2,505,000$ 2,505,000$ 2,535,209$ 30,209$ Use of money and property 96,000 96,000 46,883 (49,117) Miscellaneous - - 1,440 1,440 Total revenues 2,601,000 2,601,000 2,583,532 (17,468)

EXPENDITURES
Current:

Community services 2,210,135 2,556,294 2,318,800 237,494 Public works 1,598,708 1,648,284 1,403,122 245,162 Total expenditures 3,808,843 4,204,578 3,721,922 482,656 Excess (deficiency) of revenues
over (under) expenditures (1,207,843) (1,603,578) (1,138,390) 465,188

OTHER FINANCING SOURCES (USES)
Transfers in 1,400,000 1,400,000 1,400,000 - Total other financing sources (uses) 1,400,000 1,400,000 1,400,000 - Net change in fund balance 192,157$ (203,578)$ 261,610 465,188$ Fund balance-beginning 9,635,449
Fund balance-ending 9,897,059$

CITY OF CARLSBAD
Financing Districts
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
122
April 16, 2024
Item #2 Page 170 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Contribution from property owners -$ -$ 57,082$ 57,082$ Use of money and property 15,000 15,000 15,330 330 Total revenues 15,000 15,000 72,412 57,412

EXPENDITURES
Current:

Community services - 504,182 38,220 465,962 Debt service:

Interest - 22,365 22,365 - Total expenditures - 526,547 60,585 465,962 Net change in fund balance 15,000$ (511,547)$ 11,827 523,374$ Fund balance-beginning (16,567)
Fund balance-ending (4,740)$

CITY OF CARLSBAD
Habitat and Agricultural Management
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
123
April 16, 2024
Item #2 Page 171 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Contribution from property owners 260,000$ 260,000$ 284,652$ 24,652$ Use of money and property - - 12,653 12,653 Total revenues 260,000 260,000 297,305 37,305

EXPENDITURES
Current:

General government 463,551 482,501 402,241 80,260 Total expenditures 463,551 482,501 402,241 80,260 Net change in fund balance (203,551)$ (222,501)$ (104,936) 117,565$ Fund balance-beginning 806,261
Fund balance-ending 701,325$

CITY OF CARLSBAD
Other Special Revenue Funds
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
124
April 16, 2024
Item #2 Page 172 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental 200,000$ 616,689$ 475,881$ (140,808)$ Use of money and property 1,000 1,000 5,014 4,014 Total revenues 201,000 617,689 480,895 (136,794)

EXPENDITURES
Current:

Public safety 390,705 886,527 402,883 483,644 Capital outlay 148,309 148,309 122,291 26,018 Total expenditures 539,014 1,034,836 525,174 509,662 Net change in fund balance (338,014)$ (417,147)$ (44,279) 372,868$ Fund balance-beginning 646,543
Fund balance-ending 602,264$

CITY OF CARLSBAD
Police Grants and Asset Forfeiture
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
125
April 16, 2024
Item #2 Page 173 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental 11,297,680$ 11,813,576$ 10,617,494$ (1,196,082)$ Use of money and property - - 5,920 5,920 Miscellaneous 5,500 5,500 5,240 (260) Total revenues 11,303,180 11,819,076 10,628,654 (1,190,422)

EXPENDITURES
Current:

Community services 10,382,941 10,932,237 10,854,742 77,495 Total expenditures 10,382,941 10,932,237 10,854,742 77,495 Excess (deficiency) of revenues
over (under) expenditures 920,239 886,839 (226,088) (1,112,927)

OTHER FINANCING SOURCES (USES)
Transfers in 100,000 100,000 100,000 - Total other financing sources (uses) 100,000 100,000 100,000 - Net change in fund balance 1,020,239$ 986,839$ (126,088) (1,112,927)$ Fund balance-beginning 196,914
Fund balance-ending 70,826$

CITY OF CARLSBAD
Section 8 Rental Assistance
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
126
April 16, 2024
Item #2 Page 174 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Charges for services 646,672$ 772,670$ 802,680$ 30,010$ Use of money and property 1,965 1,965 2,186 221 Total revenues 648,637 774,635 804,866 30,231

EXPENDITURES
Current:

Community services 537,816 537,816 529,497 8,319 Capital outlay 2,900 378,898 363,864 15,034 Total expenditures 540,716 916,714 893,361 23,353 Excess (deficiency) of revenues
over (under) expenditures 107,921 (142,079) (88,495) 53,584

OTHER FINANCING SOURCES (USES)
Transfers in - 310,000 60,000 (250,000) Total other financing sources (uses) - 310,000 60,000 (250,000) Net change in fund balance 107,921$ 167,921$ (28,495) (196,416)$ Fund balance-beginning 68,225
Fund balance-ending 39,730$

CITY OF CARLSBAD
Tyler Court Apartments
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
127
April 16, 2024
Item #2 Page 175 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Use of money and property -$ -$ (9,874)$ (9,874)$ Miscellaneous - 238,846 - (238,846) Total revenues - 238,846 (9,874) (248,720)

EXPENDITURES
Current:

Public safety - 238,846 - 238,846 Total expenditures - 238,846 - 238,846 Excess (deficiency) of revenues
over (under) expenditures - - (9,874) (9,874) Net change in fund balance -$ -$ (9,874) (9,874)$ Fund balance-beginning -
Fund balance-ending (9,874)$

CITY OF CARLSBAD
California Opioid Settlement
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
128
April 16, 2024
Item #2 Page 176 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Use of money and property -$ -$ 37,011$ 37,011$ Total revenues - - 37,011 37,011

EXPENDITURES
Current:

Public works - 1,015,672 1,015,672 - Capital outlay 1,283,136 1,283,136 - 1,283,136 Total expenditures 1,283,136 2,298,808 1,015,672 1,283,136 Net change in fund balance (1,283,136)$ (2,298,808)$ (978,661) 1,320,147$ Fund balance-beginning 2,943,982
Fund balance-ending 1,965,321$

CITY OF CARLSBAD
Assessment and Other Districts
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
129
April 16, 2024
Item #2 Page 177 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental -$ -$ 2,174,230$ 2,174,230$ Use of money and property - - 631,331 631,331 Total revenues - - 2,805,561 2,805,561

EXPENDITURES
Capital outlay 440,076 440,076 57,041 383,035 Total expenditures 440,076 440,076 57,041 383,035 Net change in fund balance (440,076)$ (440,076)$ 2,748,520 3,188,596$ Fund balance-beginning (885,039)
Fund balance-ending 1,863,481$

CITY OF CARLSBAD
Bridge Thoroughfare Districts (BTD)
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
130
April 16, 2024
Item #2 Page 178 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Taxes 890,000$ 890,000$ 986,129$ 96,129$ Contribution from property owners 689,407 689,407 740,042 50,635 Use of money and property 1,273,810 1,273,810 1,143,702 (130,108) Total revenues 2,853,217 2,853,217 2,869,873 16,656

EXPENDITURES
Current:

General government 160,643 160,643 50,005 110,638 Capital outlay 34,320,567 34,320,567 912,722 33,407,845 Total expenditures 34,481,210 34,481,210 962,727 33,518,483 Net change in fund balance (31,627,993)$ (31,627,993)$ 1,907,146 33,535,139$ Fund balance-beginning 93,823,522
Fund balance-ending 95,730,668$

CITY OF CARLSBAD
Community Facilities District #1
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
131
April 16, 2024
Item #2 Page 179 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Taxes 6,010,555$ 6,010,555$ 5,520,836$ (489,719)$ Use of money and property - - 271,555 271,555 Total revenues 6,010,555 6,010,555 5,792,391 (218,164)

EXPENDITURES
Current:

Public works 600,000 600,000 600,000 - Capital outlay 25,996,000 26,829,788 6,429,728 20,400,060 Total expenditures 26,596,000 27,429,788 7,029,728 20,400,060 Net change in fund balance (20,585,445)$ (21,419,233)$ (1,237,337) 20,181,896$ Fund balance-beginning 19,205,931
Fund balance-ending 17,968,594$

CITY OF CARLSBAD
Gas Tax
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
132
April 16, 2024
Item #2 Page 180 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Use of money and property -$ -$ (1,701,774)$ (1,701,774)$ Miscellaneous - 1,923,192 2,013,865 90,673 Total revenues - 1,923,192 312,091 (1,611,101)

EXPENDITURES
Capital outlay 34,711,619 36,634,811 10,306,345 26,328,466 Total expenditures 34,711,619 36,634,811 10,306,345 26,328,466 Excess (deficiency) of revenues
over (under) expenditures (34,711,619) (34,711,619) (9,994,254) 24,717,365

OTHER FINANCING SOURCES (USES)
Transfers in 4,051,000 3,956,000 3,956,000 - Total other financing sources (uses) 4,051,000 3,956,000 3,956,000 - Net change in fund balance (30,660,619)$ (30,755,619)$ (6,038,254) 24,717,365$ Fund balance-beginning 42,532,125
Fund balance-ending 36,493,871$

CITY OF CARLSBAD
General Capital Construction
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
133
April 16, 2024
Item #2 Page 181 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental 2,373,295$ 2,373,295$ 61,709$ (2,311,586)$ Use of money and property 15,000 15,000 21,450 6,450 Total revenues 2,388,295 2,388,295 83,159 (2,305,136)

EXPENDITURES
Current:

Public works 53,000 53,000 53,000 - Capital outlay 3,478,936 3,478,936 167,146 3,311,790 Total expenditures 3,531,936 3,531,936 220,146 3,311,790 Net change in fund balance (1,143,641)$ (1,143,641)$ (136,987) 1,006,654$ Fund balance-beginning 1,771,167
Fund balance-ending 1,634,180$

CITY OF CARLSBAD
Grants and Other Capital Project Funds
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
134
April 16, 2024
Item #2 Page 182 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Use of money and property -$ -$ 1,403,303$ 1,403,303$ Miscellaneous - - 27,177 27,177 Total revenues - - 1,430,480 1,430,480

EXPENDITURES
Capital outlay 43,398,795 43,528,087 7,293,771 36,234,316 Total expenditures 43,398,795 43,528,087 7,293,771 36,234,316 Excess (deficiency) of revenues
over (under) expenditures (43,398,795) (43,528,087) (5,863,291) 37,664,796

OTHER FINANCING SOURCES (USES)
Transfers in 3,977,000 3,956,000 3,956,000 - Total other financing sources (uses) 3,977,000 3,956,000 3,956,000 - Net change in fund balance (39,421,795)$ (39,572,087)$ (1,907,291) 37,664,796$ Fund balance-beginning 113,164,506
Fund balance-ending 111,257,215$

CITY OF CARLSBAD
Infrastructure Replacement Fund
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
135
April 16, 2024
Item #2 Page 183 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Contribution from property owners 2,520,262$ 2,520,262$ 549,031$ (1,971,231)$ Use of money and property - - 135,814 135,814 Total revenues 2,520,262 2,520,262 684,845 (1,835,417)

EXPENDITURES
Capital outlay 3,619,923 3,619,923 189,929 3,429,994 Total expenditures 3,619,923 3,619,923 189,929 3,429,994 Net change in fund balance (1,099,661)$ (1,099,661)$ 494,916 1,594,577$ Fund balance-beginning 8,433,601
Fund balance-ending 8,928,517$

CITY OF CARLSBAD
Park Development
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
136
April 16, 2024
Item #2 Page 184 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Contribution from property owners 417,819$ 417,819$ 185,869$ (231,950)$ Use of money and property - - 45,029 45,029 Total revenues 417,819 417,819 230,898 (186,921)

EXPENDITURES
Capital outlay 297,738 297,738 61,972 235,766 Total expenditures 297,738 297,738 61,972 235,766 Net change in fund balance 120,081$ 120,081$ 168,926 48,845$ Fund balance-beginning 4,579,772
Fund balance-ending 4,748,698$

CITY OF CARLSBAD
Planned Local Drainage Facilities
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
137
April 16, 2024
Item #2 Page 185 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Contribution from property owners 1,798,689$ 1,798,689$ 1,196,210$ (602,479)$ Use of money and property 67,872 67,872 385,758 317,886 Total revenues 1,866,561 1,866,561 1,581,968 (284,593)

EXPENDITURES
Capital outlay 5,530,615 5,730,615 1,304,479 4,426,136 Total expenditures 5,530,615 5,730,615 1,304,479 4,426,136 Net change in fund balance (3,664,054)$ (3,864,054)$ 277,489 4,141,543$ Fund balance-beginning 33,477,234
Fund balance-ending 33,754,723$

CITY OF CARLSBAD
Public Facilities Construction
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
138
April 16, 2024
Item #2 Page 186 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental 4,387,000$ 4,387,000$ 429,466$ (3,957,534)$ Charges for services 960,000 960,000 954,794 (5,206) Use of money and property - - 172,004 172,004 Total revenues 5,347,000 5,347,000 1,556,264 (3,790,736)

EXPENDITURES
Capital outlay 31,947,980 31,947,980 3,256,940 28,691,040 Total expenditures 31,947,980 31,947,980 3,256,940 28,691,040 Net change in fund balance (26,600,980)$ (26,600,980)$ (1,700,676) 24,900,304$ Fund balance-beginning 9,006,495
Fund balance-ending 7,305,819$

CITY OF CARLSBAD
Sales Tax/TransNet
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
139
April 16, 2024
Item #2 Page 187 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Contribution from property owners 1,535,630$ 1,535,630$ 1,654,082$ 118,452$ Use of money and property - - 253,549 253,549 Total revenues 1,535,630 1,535,630 1,907,631 372,001

EXPENDITURES
Capital outlay 21,282,855 21,282,855 1,903,324 19,379,531 Total expenditures 21,282,855 21,282,855 1,903,324 19,379,531 Net change in fund balance (19,747,225)$ (19,747,225)$ 4,307 19,751,532$ Fund balance-beginning 18,725,103
Fund balance-ending 18,729,410$

CITY OF CARLSBAD
Traffic Impact Projects
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
140
April 16, 2024
Item #2 Page 188 of 244
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)

REVENUES
Use of money and property -$ -$ 21,059$ 21,059$ Total revenues - - 21,059 21,059

EXPENDITURES
Capital outlay 9,176,551 9,176,551 1,872,511 7,304,040 Total expenditures 9,176,551 9,176,551 1,872,511 7,304,040 Excess (deficiency) of revenues
over (under) expenditures (9,176,551) (9,176,551) (1,851,452) 7,325,099

OTHER FINANCING SOURCES (USES)
Transfers in - - 3,956,000 3,956,000 Total other financing sources (uses) - - 3,956,000 3,956,000 Net change in fund balance (9,176,551)$ (9,176,551)$ 2,104,548 11,281,099$ Fund balance-beginning 8,808,160
Fund balance-ending 10,912,708$

CITY OF CARLSBAD
Technology Investment Capital
Schedule of Revenues, Expenditures, and Changes in
Fund Balance - Budget and Actual
For the Year Ended June 30, 2023
141
April 16, 2024
Item #2 Page 189 of 244

CITY OF CARLSBAD
Combining Statement of Net Position
Non-Major Proprietary Funds
June 30, 2023
Totals
ASSETS
Current:

Cash and investments 6,449,248$ 10,378,473$ 16,827,721$ Receivables:

Accounts, net of allowances 6,067 - 6,067 Accrued interest 25,187 44,872 70,059 Lease 58,461 - 58,461 Other 12,496 525,000 537,496
Prepaid costs 93,070 - 93,070 Inventories 199,986 - 199,986 Total current assets 6,844,515 10,948,345 17,792,860 Noncurrent:

Lease receivable 1,242,219 - 1,242,219 Capital assets, net 21,330,065 - 21,330,065 Total noncurrent assets 22,572,284 - 22,572,284 Total assets 29,416,799 10,948,345 40,365,144

DEFERRED OUTFLOWS OF RESOURCES
Pension-related - 834,391 834,391 OPEB-related - 85,700 85,700 Total deferred outflows of resources - 920,091 920,091

LIABILITIES
Current:

Accrued liabilities 441,151 399,662 840,813 Unearned revenues 109,711 30,265 139,976 Deposits payable 871,798 - 871,798 Total current liabilities 1,422,660 429,927 1,852,587 Noncurrent:

Net pension liability - 1,920,265 1,920,265 Net OPEB liability - 73,871 73,871 Total Noncurrent Liabilities - 1,994,136 1,994,136 Total liabilities 1,422,660 2,424,063 3,846,723

DEFERRED INFLOWS OF RESOURCES
Pension-related - 24,979 24,979 OPEB-related - 15,146 15,146 Lease-related 1,257,742 - 1,257,742 Total deferred inflows of resources 1,257,742 40,125 1,297,867

NET POSITION
Invested in capital assets 21,330,065 - 21,330,065 Unrestricted 5,406,332 9,404,248 14,810,580 Total net position 26,736,397$ 9,404,248$ 36,140,645$ Business-Type Activities - Enterprise Funds
Golf Course Solid Waste
142
April 16, 2024
Item #2 Page 190 of 244

CITY OF CARLSBAD
Combining Statement of Revenues, Expenses, and
Changes in Net Position
Non-Major Proprietary Funds
Year Ended June 30, 2023
Totals

OPERATING REVENUES
Golf course operations 10,966,531$ -$ 10,966,531$ Other charges for services - 2,245,025 2,245,025 Miscellaneous 30,066 551,488 581,554 Total operating revenues 10,996,597 2,796,513 13,793,110

OPERATING EXPENSES
Administration and general 34,725 5,628,606 5,663,331 Depreciation 3,405,438 - 3,405,438 Golf course operations 8,744,007 - 8,744,007 Total operating expenses 12,184,170 5,628,606 17,812,776 Operating income (loss) (1,187,573) (2,832,093) (4,019,666)

NONOPERATING REVENUES (EXPENSES)
Intergovernmental - 209,448 209,448 Investment income (loss) 38,259 226,378 264,637 Gain (loss) on disposal of capital assets (13,851) - (13,851) Total nonoperating revenues (expenses) 24,408 435,826 460,234 Income (loss) before transfers (1,163,165) (2,396,267) (3,559,432) Transfers in - 332,000 332,000 Change in net position (1,163,165) (2,064,267) (3,227,432) Net position-beginning 27,899,562 11,468,515 39,368,077 Net position-ending 26,736,397$ 9,404,248$ 36,140,645$ Business-Type Activities - Enterprise Funds
Golf Course Solid Waste
143
April 16, 2024
Item #2 Page 191 of 244

CITY OF CARLSBAD
Combining Statement of Cash Flows
Non-Major Proprietary Funds
Year Ended June 30, 2023
Totals

CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers and users 10,975,596$ 3,179,677$ 14,155,273$ Cash paid to suppliers for goods and services (4,771,466) (808,381) (5,579,847) Cash paid to employees for services (3,916,917) (5,564,208) (9,481,125) Cash received from (payments to) others 30,066 551,488 581,554 Net cash provided by (used for) operating activities 2,317,279 (2,641,424) (324,145)

CASH FLOWS FROM NONCAPITAL

FINANCING ACTIVITIES
Cash transfers in - 332,000 332,000 Grants - - - Net cash provided by (used for) noncapital
financing activities - 332,000 332,000

CASH FLOWS FROM CAPITAL AND

RELATED FINANCING ACTIVITIES
Proceeds from sales of capital assets 20,482 - 20,482 Acquisition and construction of capital assets (1,054,158) - (1,054,158) Net cash provided by (used for) capital
and related financing activities (1,033,676) 209,448 (824,228)

CASH FLOWS FROM INVESTING ACTIVITIES
Cash received from leasing activities 81,583 - 81,583 Investment earnings 43,933 202,443 246,376 Net cash provided by (used for) investing activities 125,516 202,443 327,959 Net increase (decrease) in cash and cash equivalents 1,409,119 (1,897,533) (488,414) Cash and cash equivalents-beginning 5,173,626 12,250,227 17,423,853 Adjustment: unrealized gain (loss) on investments (133,497) 25,779 (107,718) Cash and cash equivalents-ending 6,449,248$ 10,378,473$ 16,827,721$ Business-Type Activities - Enterprise Funds
Golf Course Solid Waste
144
April 16, 2024
Item #2 Page 192 of 244

CITY OF CARLSBAD
Combining Statement of Cash Flows
Non-Major Proprietary Funds
Year Ended June 30, 2023
Totals
Business-Type Activities - Enterprise Funds
Golf Course Solid Waste

RECONCILIATION OF OPERATING INCOME (LOSS)

TO NET CASH PROVIDED BY (USED FOR)

OPERATING ACTIVITIES
Operating income (loss) (1,187,573)$ (2,832,093)$ (4,019,666)$ Adjustments to reconcile operating income (loss)
to net cash provided by (used for) operating activities:

Depreciation 3,405,438 - 3,405,438 (Increase) decrease in accounts receivable 9,065 1,115,057 1,124,122 (Increase) decrease in inventories (23,867) - (23,867) (Increase) decrease in prepaid expense (9,569) - (9,569) Increase (decrease) in accrued liabilities (129,183) (808,381) (937,564) Increase (decrease) in deposits payable 144,410 - 144,410 Increase (decrease) in unearned revenue 109,711 (180,405) (70,694) Increase (decrease) in OPEB liability - (498,707) (498,707) Increase (decrease) in pension liability (1,153) 563,105 561,952 Total adjustments 3,504,852 190,669 3,695,521 Net cash provided by (used for) operating activities 2,317,279$ (2,641,424)$ (324,145)$

SCHEDULE OF NON-CASH ACTIVITIES
Unrealized gain (loss) on investments (133,497)$ 25,779$ (107,718)$ Amortization of deferred inflows related to leases (77,243) - (77,243) 145
April 16, 2024
Item #2 Page 193 of 244

CITY OF CARLSBAD
Combining Statement of Net Position
Internal Service Funds
June 30, 2023
ASSETS
Current:

Cash and investments 21,978,344$ 6,383,285$ 9,210,581$ Receivables:

Accounts, net of allowances 4,412 - - Accrued interest 95,054 - 39,783 Prepaid costs - - 1,620,028 Inventories 235,857 - - Total current assets 22,313,667 6,383,285 10,870,392 Noncurrent:

Capital assets, net 15,705,271 - 8,590,818 Total noncurrent assets 15,705,271 - 8,590,818 Total assets 38,018,938 6,383,285 19,461,210

DEFERRED OUTFLOWS OF RESOURCES
Pension-related 632,244 - 2,425,754 OPEB-related 53,719 - 169,828 Total deferred outflows of resources 685,963 - 2,595,582

LIABILITIES
Current:

Accrued liabilities 316,171 6,383,285 1,493,173 Accrued interest - - 34,513 Deposits payable - - - Subscriptions - - 1,568,813 Claims and judgments - - - Total current liabilities 316,171 6,383,285 3,096,499 Noncurrent:

Claims and judgments, due in more than one year - - - Subscriptions - - 1,359,771 Net pension liability 1,455,045 - 5,582,627 Net OPEB liability 46,587 - 160,808 Total Noncurrent Liabilities 1,501,632 - 7,103,206 Total liabilities 1,817,803 6,383,285 10,199,705

DEFERRED INFLOWS OF RESOURCES
Pension-related 18,927 - 72,619 OPEB-related 11,023 - 22,441 Total deferred inflows of resources 29,950 - 95,060

NET POSITION
Net investment in capital assets 15,705,271 - 5,662,234 Unrestricted 21,151,877 - 6,099,793 Total net position 36,857,148$ -$ 11,762,027$ Information
Technology
Governmental Activities -
Internal Service Funds
Fleet
Management
Self Insured
Benefits
146
April 16, 2024
Item #2 Page 194 of 244

CITY OF CARLSBAD
Combining Statement of Net Position
Internal Service Funds
June 30, 2023
ASSETS
Current:

Cash and investments
Receivables:

Accounts, net of allowances
Accrued interest
Prepaid costs
Inventories
Total current assets
Noncurrent:

Capital assets, net
Total noncurrent assets
Total assets

DEFERRED OUTFLOWS OF RESOURCES
Pension-related
OPEB-related
Total deferred outflows of resources

LIABILITIES
Current:

Accrued liabilities
Accrued interest
Deposits payable
Subscriptions
Claims and judgments
Total current liabilities
Noncurrent:

Claims and judgments, due in more than one year
Subscriptions
Net pension liability
Net OPEB liability
Total Noncurrent Liabilities
Total liabilities

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

NET POSITION
Net investment in capital assets
Unrestricted
Total net position
Totals
3,388,646$ 22,034,452$ 62,995,308$
- - 4,412 14,654 95,305 244,796
- - 1,620,028 - - 235,857 3,403,300 22,129,757 65,100,401
- - 24,296,089 - - 24,296,089 3,403,300 22,129,757 89,396,490
176,340 107,522 3,341,860
10,043 4,619 238,209
186,383 112,141 3,580,069
593,863 17,701 8,804,193
- - 34,513 1,000 - 1,000
- - 1,568,813 3,410,134 10,412,160 13,822,294
4,004,997 10,429,861 24,230,813
3,246,581 11,490,258 14,736,839
- - 1,359,771 405,829 247,457 7,690,958
8,214 4,786 220,395
3,660,624 11,742,501 24,007,963
7,665,621 22,172,362 48,238,776
5,279 3,219 100,044
2,606 229 36,299
7,885 3,448 136,343
- - 21,367,505 (4,083,823) 66,088 23,233,935
(4,083,823)$ 66,088$ 44,601,440$
Risk
Management
Workers'
Compensation
Governmental Activities -
Internal Service Funds
147
April 16, 2024
Item #2 Page 195 of 244

CITY OF CARLSBAD
Combining Statement of Revenues,
Expenses, and Changes in Net Position
Internal Service Funds
Year Ended June 30, 2023

OPERATING REVENUES
Other charges for services 6,802,710$ -$ 16,413,922$ Miscellaneous 42,228 - 46,434 Total operating revenues 6,844,938 - 16,460,356

OPERATING EXPENSES
Administration and general 2,076,179 - 13,905,165 Claims and premiums - - - Depreciation/amortization 2,494,011 - 2,536,449 Fuel and supplies 1,839,305 - - Small equipment purchases 4,752 - 540,076 Total operating expenses 6,414,247 - 16,981,690 Operating income (loss) 430,691 - (521,334)

NONOPERATING REVENUES (EXPENSES)
Interest expense - - (77,521) Investment income (loss) 90,588 - 26,897 Gain (loss) on disposal of capital assets 51,645 - - Total nonoperating revenues (expenses) 142,233 - (50,624) Income (loss) before transfers and
capital contributions 572,924 - (571,958) Transfers in 1,400,000 - - Capital contributions 343,194 - 1,000,863 Change in net position 2,316,118 - 428,905 Net position-beginning 34,541,030 - 11,333,122 Net position-ending 36,857,148$ -$ 11,762,027$ Fleet
Management
Self Insured
Benefits
Information
Technology
Governmental Activities -
Internal Service Funds
148
April 16, 2024
Item #2 Page 196 of 244

CITY OF CARLSBAD
Combining Statement of Revenues,
Expenses, and Changes in Net Position
Internal Service Funds
Year Ended June 30, 2023

OPERATING REVENUES
Other charges for services
Miscellaneous
Total operating revenues

OPERATING EXPENSES
Administration and general
Claims and premiums
Depreciation/amortization
Fuel and supplies
Small equipment purchases
Total operating expenses
Operating income (loss)

NONOPERATING REVENUES (EXPENSES)
Interest expense
Investment income (loss)
Gain (loss) on disposal of capital assets
Total nonoperating revenues (expenses)
Income (loss) before transfers and
capital contributions
Transfers in
Capital contributions
Change in net position
Net position-beginning
Net position-ending
Totals
3,889,896$ 5,173,980$ 32,280,508$
57,020 435,983 581,665
3,946,916 5,609,963 32,862,173
509,768 149,395 16,640,507
8,201,800 14,363,854 22,565,654
- - 5,030,460 - - 1,839,305 - - 544,828 8,711,568 14,513,249 46,620,754
(4,764,652) (8,903,286) (13,758,581)
- - (77,521) 103,181 (187,709) 32,957
- - 51,645 103,181 (187,709) 7,081
(4,661,471) (9,090,995) (13,751,500)
1,000,000 8,208,252 10,608,252
- - 1,344,057 (3,661,471) (882,743) (1,799,191)
(422,352) 948,831 46,400,631
(4,083,823)$ 66,088$ 44,601,440$
Risk
Management
Workers'
Compensation
Governmental Activities -
Internal Service Funds
149
April 16, 2024
Item #2 Page 197 of 244

CITY OF CARLSBAD
Combining Statement of Cash Flows
Internal Service Funds
Year Ended June 30, 2023

CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from interfund service provided 6,811,104$ 512,874$ 16,413,922$ Cash paid to suppliers for goods and services (1,738,593) - (251,817) Cash paid to employees for services (2,027,351) - (12,852,734) Claims and premiums paid - - - Cash received from (payments to) others 42,228 - 46,434 Net cash provided by (used for) operating activities 3,087,388 512,874 3,355,805

CASH FLOWS FOM NONCAPITAL

FINANCING ACTIVITIES
Cash transfers in 1,400,000 - - Net cash provided by (used for) noncapital
financing activities 1,400,000 - -

CASH FLOWS FROM CAPITAL AND

RELATED FINANCING ACTIVITIES
Acquisition and construction of capital assets (1,639,601) - (232,524) Principal paid on capital debt - - (1,925,993) Interest paid on capital debt - - (43,008) Proceeds from sales of capital assets 51,645 - - Net cash provided by (used for) capital
and related financing activities (1,587,956) - (2,201,525)

CASH FLOWS FROM INVESTING ACTIVITIES
Investment earnings 339,084 - 126,804 Net cash provided by (used for) investing activities 339,084 - 126,804 Net increase (decrease) in cash and cash equivalents 3,238,516 512,874 1,281,084 Cash and cash equivalents-beginning 19,010,881 5,870,411 8,038,530 Adjustment: unrealized gain (loss) on investments (271,053) - (109,033) Cash and cash equivalents-ending 21,978,344$ 6,383,285$ 9,210,581$ Governmental Activities -
Internal Service Funds
Fleet
Management
Self Insured
Benefits
Information
Technology
150
April 16, 2024
Item #2 Page 198 of 244

CITY OF CARLSBAD
Combining Statement of Cash Flows
Internal Service Funds
Year Ended June 30, 2023
Governmental Activities -
Internal Service Funds
Fleet
Management
Self Insured
Benefits
Information
Technology

RECONCILIATION OF OPERATING INCOME (LOSS)

TO NET CASH PROVIDED BY (USED FOR)

OPERATING ACTIVITIES
Operating income (loss) 430,691$ -$ (521,334)$ Adjustments to reconcile operating income (loss)
to net cash provided by (used for) operating activities:

Depreciation/amortization 2,494,011 - 2,536,449 (Increase) decrease in accounts receivable 8,394 - - (Increase) decrease in inventories 21,401 - - (Increase) decrease in prepaid expense - - 783,215 Increase (decrease) in accrued liabilities 84,063 512,874 370,663 Increase (decrease) in deposits payable - - - Increase (decrease) in OPEB liability 853 2,747 Increase (decrease) in pension liability 47,975 184,065 Increase (decrease) in claims and judgments - - - Total adjustments 2,656,697 512,874 3,877,139 Net cash provided by (used for) operating activities 3,087,388$ 512,874$ 3,355,805$

SCHEDULE OF NON-CASH ACTIVITIES
Donated capital assets 343,194$ -$ 1,000,863$ Capital assets purchased on account - - 690
Unrealized gain (loss) on investments (271,053) - (109,033) 151
April 16, 2024
Item #2 Page 199 of 244

CITY OF CARLSBAD
Combining Statement of Cash Flows
Internal Service Funds
Year Ended June 30, 2023

CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from interfund service provided
Cash paid to suppliers for goods and services
Cash paid to employees for services
Claims and premiums paid
Cash received from (payments to) others
Net cash provided by (used for) operating activities

CASH FLOWS FOM NONCAPITAL

FINANCING ACTIVITIES
Cash transfers in
Net cash provided by (used for) noncapital
financing activities

CASH FLOWS FROM CAPITAL AND

RELATED FINANCING ACTIVITIES
Acquisition and construction of capital assets
Principal paid on capital debt
Interest paid on capital debt
Proceeds from sales of capital assets
Net cash provided by (used for) capital
and related financing activities

CASH FLOWS FROM INVESTING ACTIVITIES
Investment earnings
Net cash provided by (used for) investing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents-beginning
Adjustment: unrealized gain (loss) on investments
Cash and cash equivalents-ending
Totals
3,889,896$ 5,173,980$ 32,801,776$
- - (1,990,410) (161,307) (130,194) (15,171,586)
(6,214,911) (4,701,425) (10,916,336)
57,020 435,983 581,665
(2,429,302) 778,344 5,305,109
1,000,000 8,208,252 10,608,252
1,000,000 8,208,252 10,608,252
- - (1,872,125) - - (1,925,993) - - (43,008) - - 51,645 - - (3,789,481) 64,715 310,612 841,215
64,715 310,612 841,215
(1,364,587) 9,297,208 12,965,095
4,711,454 13,280,227 50,911,503
41,779 (542,983) (881,290)
3,388,646$ 22,034,452$ 62,995,308$
Governmental Activities -
Internal Service Funds
Risk
Management
Workers'
Compensation
152
April 16, 2024
Item #2 Page 200 of 244

CITY OF CARLSBAD
Combining Statement of Cash Flows
Internal Service Funds
Year Ended June 30, 2023

RECONCILIATION OF OPERATING INCOME (LOSS)

TO NET CASH PROVIDED BY (USED FOR)

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

Depreciation/amortization
(Increase) decrease in accounts receivable
(Increase) decrease in inventories
(Increase) decrease in prepaid expense
Increase (decrease) in accrued liabilities
Increase (decrease) in deposits payable
Increase (decrease) in OPEB liability
Increase (decrease) in pension liability
Increase (decrease) in claims and judgments
Total adjustments
Net cash provided by (used for) operating activities

SCHEDULE OF NON-CASH ACTIVITIES
Donated capital assets
Capital assets purchased on account
Unrealized gain (loss) on investments
Totals
Governmental Activities -
Internal Service Funds
Risk
Management
Workers'
Compensation
(4,764,652)$ (8,903,286)$ (13,758,581)$
- - 5,030,460 - - 8,394 - - 21,401 - - 783,215 334,931 10,961 1,313,492
- - -
(107,165) (64,614) (168,179)
120,695 72,854 425,589
1,986,889 9,662,429 11,649,318
2,335,350 9,681,630 19,063,690
(2,429,302)$ 778,344$ 5,305,109$
-$ -$ 1,344,057$ - - 690
41,779 (542,983) (881,290)
153
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Total
Custodial
Funds
ASSETS
Cash and cash equivalents 3,991,895$ 7,087,470$ 11,079,365$ Restricted assets:

Cash and investments 2,370,330 - 2,370,330 Receivables:

Assessments 17,544 6,838 24,382 Accrued interest 17,267 30,655 47,922 Taxes 595 - 595
Total assets 6,397,631 7,124,963 13,522,594

LIABILITIES
Accrued liabilities 26,746 107,994 134,740 Due to bondholders 6,370,885 - 6,370,885 Total liabilities 6,397,631 107,994 6,505,625

NET POSITION
Restricted for:

Individuals, organizations and other governments - 7,016,969 7,016,969 Total net position -$ 7,016,969$ 7,016,969$ Business
Improvement
Districts

CITY OF CARLSBAD
Combining Statement of Fiduciary Net Position
Custodial Funds
June 30, 2023
Assessment
Districts
154
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Total
Custodial
Funds

ADDITIONS
Assessment district collections 6,242,998$ 7,763,752$ 14,006,750$ Proceeds from debt issuance 16,240,000 - 16,240,000 Income (loss) from property and investments 171,184 (1,219) 169,965 Taxes 1,308,000 - 1,308,000 Miscellaneous 4,418,368 - 4,418,368 Total additions 28,380,550 7,762,533 36,143,083

DEDUCTIONS
Distributions to beneficiaries - 6,054,378 6,054,378 Administrative expenses - 162,596 162,596 Debt refunding 22,236,632 - 22,236,632 Bond interest expense and fees 1,544,538 - 1,544,538 Principal expense 2,365,000 - 2,365,000 Other deductions 2,234,380 - 2,234,380 Total deductions 28,380,550 6,216,974 34,597,524 Net increase (decrease) in fiduciary net position - 1,545,559 1,545,559 Net position-beginning, restated - 5,471,410 5,471,410 Net position-ending -$ 7,016,969$ 7,016,969$

CITY OF CARLSBAD
Combining Statement of Changes in Fiduciary Net Position Custodial Funds
For the Year Ended June 30, 2023
Assessment
Districts
Business
Improvement
Districts
155
April 16, 2024
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156
April 16, 2024
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157

Statistical Section

This section of the City of Carlsbad’s Annual Comprehensive Financial Report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplement ary information says about the city’s overall financial health.

Table of Contents Page

Financial Trends 158
These schedules contain trend information to help the reader understand how the c ity’s financial performance and well-being have changed over time.

Revenue Capacity 168
These schedules contain information to help the reader assess the c ity’s water and wastewater revenue sources as well as the city’s most significant local revenue source, property tax es.

Debt Capacity 177
These schedules present information to help the reader assess the affordability of the city’s current levels of outstanding debt, and the city’s ability to issue additional debt in the future.

Demographic and Economic Information 186
These schedules offer demographic and economic indicators to help the reader understand th e environment within which the city’s financial activities take place.

Operating Information 190
These schedules contain service and infrastructure data to help the reader understand how the information in the c ity’s financial report relates to the services the c ity provides and the activities it performs.

Sources: Unless otherwise noted, the information in these schedules is derived from the Annual Comprehensive Financial Reports for the relevant year.

April 16, 2024
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{city of
Carlsbad
Net Position by Component
Last Ten Fiscal Years
(dollars in thousands)
2013-14 2014-15 2015-16 2016-17
Governmental activities
Net investment in capital assets 784,210$ 783,298$ 788,035$ 788,078$ Restricted for:

Capital projects 175,468 178,228 176,279 183,245 Lighting and landscaping districts 4,703 5,263 5,921 6,527 Affordable housing 39,317 39,544 40,390 40,528 Habitat and agricultural mitigation management 1,713 1,708 1,758 1,805 Other purposes 3,774 3,059 2,948 2,818 Unrestricted 328,602 223,522 245,078 249,816 Total governmental activities net position 1,337,787$ 1,234,622$ 1 1,260,409$ 1,272,817$ Business-type activities
Net investment in capital assets 305,681$ 307,122$ 317,927$ 344,836$ Restricted for:

Capital projects 46,632 47,315 45,950 40,098 Unrestricted 66,083 69,922 73,285 85,153 Total business-type activities net position 418,396$ 424,359$ 1 437,162$ 470,087$ Total government
Net investment in capital assets 1,089,891$ 1,090,420$ 1,105,962$ 1,132,914$ Restricted for:

Capital projects 222,100 225,543 222,229 223,343 Lighting and landscaping districts 4,703 5,263 5,921 6,527 Affordable housing 39,317 39,544 40,390 40,528 Habitat and agricultural mitigation management 1,713 1,708 1,758 1,805 Other purposes 3,774 3,059 2,948 2,818 Unrestricted 394,685 293,444 318,363 334,969 Total net position 1,756,183$ 1,658,981$ 1,697,571$ 1,742,904$ Source: City of Carlsbad Annual Comprehensive Financial Reports 1 Net position for the prior year was restated in FY 2014-15, to reflect the application of GASB 68, Accounting & Financial Reporting for Pensions.
2 Habitat and agricultural mitigation management was combined with other purposes in FY 2019-20 due to immateriality. 3 In FY 2020-21 a transfer of $47 million was made from the General Fund to the Golf Course Fund. The recorded advance from the General Fund to the Golf Course Fund was removed as it was determined that repayment of the advance is not projected in the near or foreseeable future.
158
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Ccityof
Carlsbad
2017-18 2018-19 2019-20 2020-21 2021-22 2022-23
793,090$ 786,965$ 791,124$ 789,335$ 808,515$ 809,083$ 182,811 194,434 206,067 212,636 191,967 192,629 7,307 8,025 8,967 9,225 9,635 9,897 41,500 43,588 44,885 40,988 41,413 41,801 1,640 1,524 - 2 - - - 2,800 4,329 5,444 6,251 6,254 4,903 262,023 289,000 286,386 249,699 3 263,633 266,786 1,291,171$ 1,327,865$ 1,342,873$ 1,308,134$ 1,321,417$ 1,325,099$ 349,548$ 346,628$ 351,153$ 361,477$ 355,487$ 352,494$ 39,522 38,540 41,244 41,462 38,949 38,437 88,576 97,509 94,140 149,954 3 151,766 157,191 477,646$ 482,677$ 486,537$ 552,893$ 546,202$ 548,122$ 1,142,638$ 1,133,593$ 1,142,277$ 1,150,812$ 1,164,002$ 1,161,577$ 222,333 232,974 247,311 254,098 230,916 231,066 7,307 8,025 8,967 9,225 9,635 9,897 41,500 43,588 44,885 40,988 41,413 41,801 1,640 1,524 - 2 - - - 2,800 4,329 5,444 6,251 6,254 4,903 350,599 386,509 380,526 399,653 415,399 423,977 1,768,817$ 1,810,542$ 1,829,410$ 1,861,027$ 1,867,619$ 1,873,221$ 159
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Changes in Net Position
Last Ten Fiscal Years
(dollars in thousands)
2013-14 2014-15 2015-16 2016-17
Expenses
Governmental activities
General government 20,187$ 16,108$ 16,147$ 18,374$ Public safety 48,942 48,856 50,463 55,994 Community services 45,341 48,630 51,191 54,212 Public works 30,314 36,273 37,464 34,317 Interest and fiscal charges on long-term debt 1 - 1 3 Total governmental activities 144,785 149,867 155,266 162,900 Business-type activities
Carlsbad Municipal Water District 43,547 40,897 39,458 45,219 Golf course 11,032 10,538 10,545 10,211 Wastewater 12,488 12,629 12,613 12,626 Solid waste 2,856 2,973 2,997 3,272 Total business-type activities 69,923 67,037 65,613 71,328 Total government 214,708$ 216,904$ 220,879$ 234,228$ Program Revenues
Governmental activities
Charges for services:

General government 289$ 1,382$ 296$ 327$ Public safety 3,950 4,220 3,980 4,647 Community services 8,732 10,534 10,711 12,154 Public works 3,720 4,014 4,152 3,952 Operating contributions and grants 11,919 12,242 11,912 12,630 Capital contributions and grants 16,129 19,105 12,042 2 22,789 Total governmental activities 44,739 51,497 43,093 56,499 Business-type activities
Charges for services:

Carlsbad Municipal Water District 46,750 47,461 39,854 3 44,817 Golf course 6,635 6,709 6,988 7,119 Wastewater 12,896 12,875 12,963 13,467 Solid waste 3,320 3,245 3,206 3,302 Operating contributions and grants 90 59 5,646 2,471 Capital contributions and grants 3,198 5,879 2,011 13,322 Total business-type activities 72,889 76,228 70,668 84,498 Total government 117,628$ 127,725$ 113,761$ 140,997$ Net (Expense)/Revenue:

Governmental activities (100,046)$ (98,370)$ (112,173)$ (106,401)$ Business-type activities 2,966 9,191 5,055 13,170 Total government net expense (97,080)$ (89,179)$ (107,118)$ (93,231)$ 160
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{_city of
Carlsbad
2017-18 2018-19 2019-20 2020-21 2021-22 2022-23
25,192$ 5 22,234$ 24,267$ 20,003$ 14,806$ 22,768$ 62,630 5 67,968 75,249 80,295 81,130 99,484 51,897 57,978 60,771 57,654 58,954 76,374 36,875 36,897 41,419 35,481 39,204 54,124 2 4 2 - 14 21 176,596 185,081 201,708 193,433 194,108 252,771 51,658 51,638 51,198 56,319 53,598 54,178 10,560 11,035 10,252 10,280 11,708 12,198 13,495 15,238 16,931 9,063 17,905 20,194 3,089 3,840 4,382 5,086 4,738 5,405 78,802 81,751 82,763 80,748 87,949 91,975 255,398$ 266,832$ 284,471$ 274,181$ 282,057$ 344,746$ 816$ 1,679$ 1,030$ 1,260$ 627$ 634$ 4,805 4,784 4,711 5,020 5,899 6,505 11,588 10,755 9,324 8,080 8,671 9,423 3,768 4,574 4,142 5,662 4,247 3,505 13,054 17,307 18,437 26,459 20,382 14,060 22,993 13,842 16,802 9,565 9,922 12,967 57,024 52,941 54,446 56,046 49,748 47,094 50,095 46,431 46,332 49,668 49,194 46,102 7,973 7,979 6,637 8,108 10,424 10,967 13,885 14,099 13,849 14,027 16,282 19,616 3,427 3,440 3,563 3,387 3,684 2,245 1,611 1,260 399 3,484 183 209 5,484 4,864 6,327 7,601 858 5,189 82,475 78,073 77,107 86,275 80,625 84,328 139,499$ 131,014$ 131,553$ 142,321$ 130,373$ 131,422$ (119,572)$ (132,140)$ (147,262)$ (137,387)$ (144,360)$ (205,677)$ 3,673 (3,678) (5,656) 5,527 (7,324) (7,647) (115,899)$ (135,818)$ (152,918)$ (131,860)$ (151,684)$ (213,324)$ (continued)
161
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Changes in Net Position (continued)
Last Ten Fiscal Years
(dollars in thousands)
2013-14 2014-15 2015-16 2016-17
General Revenues and Other Changes in Net Position
Governmental activities
Taxes:

Property taxes 52,608$ 55,992$ 58,945$ 63,988$ Sales and use taxes 30,520 32,146 34,843 33,999 Transient occupancy taxes 17,472 19,713 20,943 22,267 Franchise taxes 4,907 5,427 5,632 5,475 Business license taxes 4,177 4,548 4,895 4,328 Real property transfer taxes 1,080 1,406 1,546 1,393 Use of money and property 6,917 4,564 11,910 4 1,975 Other general revenues 429 609 486 451 Extraordinary gain/(loss) (10,289) 1 - - - Special items-Golf Course debt - - - - Transfers (1,188) (1,264) (1,240) (15,067) Total governmental activities 106,633 123,141 137,960 118,809 Business type activities
Property taxes 2,897 3,133 3,306 3,569 Income from property and investments 2,498 1,870 3,163 749 Other general revenues 99 623 39 370 Transfers 1,188 1,264 1,240 15,067 Special items-Golf Course debt - - - - Total business-type activities 6,682 6,890 7,748 19,755 Total government 113,315$ 130,031$ 145,708$ 138,564$ Change in Net Position
Governmental activities 6,587$ 24,771$ 25,787$ 12,408$ Business-type activities 9,648 16,081 12,803 32,925 Total government 16,235$ 40,852$ 38,590$ 45,333$ Source: City of Carlsbad Annual Comprehensive Financial Reports 1 2
3 The decrease in FY 2015-16 was a result of a decrease in water sales during the fiscal year from drought conservation measures. 4 5
6 7
8 Decrease in investment income for FY 2021-22 is due to the required fair value adjustment at fiscal year end (per GASB 31).

Successor Housing Agency per California state mandate.

Poinsettia Fire, as well as the receipt of retroactive mandated cost reimbursements. from the California Department of Finance earned on unpaid mandated costs. investments to fair market value at June 30, 2021 and a decrease in the average yield on the treasurer's portfolio for the year.

The extraordinary loss in FY 2013-14 resulted from the restatement of accrued interest on prior year advances made by the city to the The decrease in FY 2015-16 was a result of one-time funds received from the federal government in the previous fiscal year for the 2014 Fund to the Golf Course Fund was removed as it was determined that repayment of the advance is not projected in the near or foreseeable future.

The increase in FY 2015-16 is a result of higher cash balances that generate interest, an increase in investment earnings, and interest received The increase in FY 2017-18 is mainly due to changes in the city's pension discount rate.

The decrease is FY 2020-21 in income from property and investments was caused by unrealized losses created by adjusting the city's In FY 2020-21 a transfer of $47 million was made from the General Fund to the Golf Course Fund. The recorded advance from the General 162
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{_city of
Carlsbad
2017-18 2018-19 2019-20 2020-21 2021-22 2022-23
66,524$ 69,952$ 73,885$ 78,239$ 81,012$ 88,196$ 33,674 38,510 36,491 42,579 51,175 56,187 24,233 26,320 18,898 15,584 32,403 34,280 5,812 6,100 5,864 5,774 6,371 7,834 5,026 5,322 5,414 5,705 6,619 6,357 1,463 1,715 1,247 1,786 2,179 1,367 2,551 20,695 20,239 5,036 6 (22,063) 8 10,988 519 439 559 516 1,262 4,483 - - - - - - - - - (8,427) 7 - - (136) (219) (303) (47,273) 7 (1,316) (332) 139,666 168,834 162,294 99,519 157,642 209,360 3,743 4,002 4,226 4,491 4,715 5,130 986 7,784 4,963 639 6 (7,656) 8 2,579 3 113 - - 2,258 1,526 136 219 303 47,273 7 1,316 332 - - - 8,427 7 - - 4,868 12,118 9,492 60,830 633 9,567 144,534$ 180,952$ 171,786$ 160,349$ 158,275$ 218,927$ 20,094$ 36,694$ 15,032$ (37,868)$ 13,282$ 3,683$ 8,541 8,440 3,836 66,357 (6,691) 1,920 28,635$ 45,134$ 18,868$ 28,489$ 6,591$ 5,603$ 163
April 16, 2024
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Fund Balances of Governmental Funds
Last Ten Fiscal Years
(dollars in thousands)
2013-14 2014-15 2015-16 2016-17 2017-18
General Fund
Nonspendable 56,707$ 56,381$ 55,324$ 53,751$ 51,628$ Committed 1,000 1,000 1,000 1,000 1,000 Assigned 27,838 40,865 42,692 38,439 43,855 Unassigned 75,615 80,274 94,404 78,191 82,570 Total General Fund 161,160$ 178,520$ 193,420$ 171,381$ 179,053$ All Other Governmental Funds
Nonspendable
Special revenue funds 430$ 3$ 4$ 1$ 1$ Capital project funds - - - - - Restricted
Special revenue funds 66,833 66,300 51,013 1 51,677 53,246 Capital project funds 157,712 161,499 176,280 1 183,245 182,812 Assigned
Capital project funds 131,627 136,237 131,939 146,994 151,306 Unassigned
Special revenue funds - - - - - Capital project funds - - - - - Total all other governmental funds 356,602$ 364,039$ 359,236$ 381,917$ 387,365$ Source: City of Carlsbad Annual Comprehensive Financial Reports 1 Beginning in FY 2015-16, the Gas Tax fund balance was reclassified from a Special Revenue fund to a Capital Project fund. 2 In FY 2019-20, the General Fund advanced money to the Habitat Mitigation Fund, a Special Revenue fund, to be repaid to the General Fund once funds are available.
3 In FY 2020-21 a transfer of $47 million was made from the General Fund to the Golf Course Fund. The recorded advance from the General Fund to the Golf Course Fund was removed as it was determined that repayment of the advance is not projected in the near or foreseeable future. 164
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{_city of
Carlsbad
2018-19 2019-20 2020-21 2021-22 2022-23
49,608$ 49,008$ 3,446$ 3 2,211$ 1,799$ 1,000 1,000 1,000 1,000 1,000 33,367 30,733 56,115 48,982 43,210 101,701 110,122 99,260 109,946 136,840 185,676$ 190,863$ 159,821$ 162,139$ 182,849$ 1$ 1$ 1$ 3$ -$ - - - 157 376 57,465 59,295 56,465 57,302 56,603 194,434 206,067 212,635 191,967 192,629 162,139 165,267 166,206 164,349 158,288 - (234) 2 (228) (17) (15) - - - (885) - 414,039$ 430,396$ 435,079$ 412,876$ 407,881$ 165
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Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(dollars in thousands)
2013-14 2014-15 2015-16 2016-17
Revenues:

Taxes 114,996$ 123,411$ 2 129,617$ 134,165$ Intergovernmental 10,602 10,359 11,290 11,963 Licenses and permits 2,184 2,369 2,467 3,034 Charges for services 11,278 13,181 12,913 14,309 Fines and forfeitures 876 837 854 740 Use of money and property 7,604 6,442 9,970 3,845 Contributions from property owners 9,042 10,688 8,009 13,330 Contributions 210 440 417 349 Miscellaneous 1,219 2,550 1,503 1,467 Total revenues 158,011 170,277 177,040 183,202 Expenditures:

Current:

General government 21,471 17,903 17,221 27,925 Less: Interdepartmental charges (3,566) (3,807) (3,471) (3,345) Public safety 47,333 48,915 52,015 57,329 Community services 41,505 44,501 46,298 48,930 Public works 15,442 16,350 17,465 17,349 Capital outlay 18,702 20,050 34,669 17,603 Debt service:

Principal retirement 159 - - - Interest and fiscal charges 5 5 6 5 Total expenditures 141,051 143,917 164,203 165,796 Excess (deficiency) of revenues
over (under) expenditures 16,960 26,360 12,837 17,406 Other financing sources (uses):

Transfers in 11,477 14,857 9,970 20,849 Transfers out (16,415) (16,420) (12,710) (37,613) 3 Proceeds from sale of capital asset - - - - Proceeds from leases - - - - Total other financing sources (uses) (4,938) (1,563) (2,740) (16,764) Net change in fund balances 12,022$ 24,797$ 10,097$ 642$ Debt service as percentage of noncapital
expenditures1

0.13% 0.00% 0.00% 0.00%
Source: City of Carlsbad Annual Comprehensive Financial Reports 1 Noncapital expenditures are total expenditures less capital outlay (to the extent capitalized for the Government-wide Statement 2 3
4 Increase in investment income for FY 2018-19 is due to an increase in the average yield on the investment portfolio for the year as well as an 5 Increase in public safety expenditures in FY 2018-19 is due to a voluntary $14.2 million additional payment to CalPERS to reduce the city's 6 Decrease in tax revenue for sales and transient occupancy taxes for FY 2020-21 is due to the effects of the COVID-19 pandemic and 7 Decrease in investment income for FY 2021-22 is due to the required fair value adjustment done on investments at fiscal year end (per GASB 31). unfunded pension liability in the safety plan.
resulting stay at home orders on sales and transient occupancy taxes. of Net Position) and expenditures for capitalized assets included within the functional expenditure categories.

Increase in taxes in FY 2014-15 due to growth in property and TOT taxes. during FY 2016-17.
increase due to the required fair value adjustment done on investments at fiscal year end (per GASB 31).

Includes a transfer out to the Golf Course Fund in the amount of $14.8 million for the defeasance of the golf course construction bonds 166
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{_city of
Carlsbad
2017-18 2018-19 2019-20 2020-21 2021-22 2022-23
141,118$ 154,673$ 147,535$ 6 155,462$ 184,832$ 199,742$ 11,608 14,647 15,505 23,653 20,933 16,724 2,999 2,668 2,739 2,399 3,233 3,710 14,145 13,221 11,525 11,615 14,959 15,163 679 581 760 429 346 390 4,622 23,275 4 24,989 7,018 (20,118) 7 11,066 12,898 10,301 6,623 5,850 3,200 4,915 332 1,385 426 321 381 314 1,991 3,316 2,641 1,786 1,262 3,969 190,392 224,067 212,743 208,533 209,028 255,993 26,625 24,033 25,762 22,450 22,433 23,428 (3,160) (4,581) (5,052) (5,146) (5,315) (5,991) 58,568 77,550 5 70,997 78,731 82,225 85,829 49,039 52,951 56,931 53,267 59,491 65,514 17,220 18,380 19,995 19,991 22,056 25,337 26,885 20,703 22,171 21,390 47,015 35,578 10 10 11 8 3 - 7 5 12 17 15 22 175,194 189,051 190,827 190,708 227,923 229,717 15,198 35,016 21,916 17,825 (18,895) 26,276 11,513 11,881 11,183 9,760 25,974 13,428 (13,590) (13,600) (11,486) (57,073) (27,189) (24,368) - - - - 200 379 - - - - 25 - (2,077) (1,719) (303) (47,313) (990) (10,561) 13,121$ 33,297$ 21,613$ (29,488)$ (19,885)$ 15,715$

0.01% 0.01% 0.01% 0.01% 0.01% 0.01%
167
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General Governmental Tax Revenues by Source
Last Ten Fiscal Years
(dollars in thousands)
Fiscal Year
Property
Tax *
Sales and
Use Taxes
Transient
Occupancy
Taxes
Franchise
Taxes
Business
License
Taxes
Real
Property
Transfer
Taxes Gas Tax
Total Tax
Revenue
2013-14 52,607$ 31,464$ 17,472$ 4,907$ 4,178$ 1,080$ 3,288$ 114,996$ 2014-15 55,992 1 33,202 19,713 2 5,427 4,548 1,406 3,123 123,411 2015-16 58,946 35,232 20,943 5,632 4,895 1,545 2,424 129,617 2016-17 63,988 1 34,543 22,267 3 5,475 4,328 1,393 2,171 134,165 2017-18 66,523 34,972 24,234 4 5,812 5,026 5 1,463 3,088 6 141,118 2018-19 69,952 40,795 7 26,320 6,100 5,322 1,715 4,469 154,673 2019-20 73,889 37,585 8 18,898 8 5,864 5,414 1,247 4,638 147,535 2020-21 78,247 43,726 15,584 8 5,774 5,705 1,786 4,640 155,462 2021-22 81,012 51,175 32,403 6,371 6,619 2,179 5,073 184,832 2022-23 88,196 56,187 34,280 7,834 6,357 1,367 5,521 199,742 Percentage change from FY 2013-14 to FY 2022-23:
68% 79% 96% 60% 52% 27% 68% 74%
1 Reflects improvement in the housing market and new construction. 2 The increase in TOT in FY 2014-15 is due to the openings of several new hotels and higher occupancy and room rates throughout the city. 3 The increase in TOT in FY 2016-17 is due to higher room rates throughout most of the city's hotels and an increase in available rooms. 4 The increase in TOT in FY 2017-18 is due to higher room rates throughout most of the city's hotels and an opening of a new hotel. 5 The increase in Business License Taxes in FY 2017-18 is due to a significant number of delinquent payments being collected. 6 The increase in Gas Taxes in FY 2017-18 is due to new ongoing allocations received from the state's Road Maintenance and Rehabilitation Account. 7 The increase in Sales and Use Taxes in FY 2018-19 is due to overall growth and the ending of the state's sales and use tax "triple flip" in FY 2017-18. 8 The decreases in tax revenue for sales tax for FY 2019-20 and transient occupancy taxes for FY 2019-20 and FY 2020-21 is due to the effects of the COVID-19 pandemic and resulting stay at home orders on sales and transient occupancy taxes. * Property Tax category also includes Vehicle License Fees (VLF) in lieu, property tax increment and CFD No. 1 special taxes.

Source: City of Carlsbad Annual Comprehensive Financial Reports $0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
$90,000
2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 Total General Governmental Tax Revenues - Last Ten Fiscal Years (in thousands)
Property Tax Sales and Use Taxes TOT Other
168
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{city of
Carlsbad
■ ■ ■ ■
Water and Wastewater Rates
Last Ten Fiscal Years
Wastewater
Fiscal Year
Monthly Delivery
Charge
Base Price Per
Unit1
Monthly Base
Rate
2013-14 $20.07 $3.19 $25.52
2014-15 21.08 3.35 26.03
2015-16 22.19 3.53 27.81
2016-17 24.11 3.84 27.81
2017-18 24.72 3.94 27.81
2018-19 24.72 3.94 27.81
2019-20 25.02 4.04 28.66
2020-21 25.52 4.13 29.52
2021-22 27.81 3.84 35.93
2022-23 28.37 3.92 43.11
Source: City of Carlsbad
1 Water
Note: Rates shown are for a 5/8" meter, which is the standard household meter size.

One unit of water equals 748 gallons. The base price shown is for tier 1, which applies to the first 12 units of usage per month at a single family residence. 169
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{city of
Carlsbad

170
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Assessed Value of Taxable Property
Last Ten Fiscal Years
(dollars in millions)
Fiscal
Year
Residential
Property
Commercial
Property
Industrial
Property
Exemptions
and Other
Taxable
Property1
Net
Assessed
Valuation
Change
From Prior
Year
Estimated
Property Tax
Revenue2
Total Direct
Tax Rate3
2013-14 17,774$ 3,298$ 1,871$ 580$ 23,523$ 2.47% 0 0.1927% 2014-15 19,450 3,603 1,847 589 25,489 8.36 49 0.1927 2015-16 20,431 3,973 1,909 612 26,925 5.63 52 0.1927 2016-17 21,472 4,238 2,092 622 28,424 5.57 55 0.1927 2017-18 22,707 4,355 2,378 555 29,995 5.53 58 0.1927 2018-19 24,077 4,528 2,541 490 31,636 5.47 61 0.1927 2019-20 25,379 4,964 2,673 640 33,656 6.39 65 0.1927 2020-21 26,507 5,224 2,809 677 35,217 4.64 68 0.1927 2021-22 27,697 5,325 2,883 457 36,362 3.25 70 0.1927 2022-23 29,579 5,698 3,141 748 39,166 7.71 75 0.1927 1 Other property includes farm, rural, institutional, recreational, state secured property, unsecured property, personal property and fixtures. 2 Estimated property tax revenues do not include special assessments, redevelopment tax increment or community facilities district revenues. 3 The total direct tax rate is the city's proportionate share of Proposition 13 property taxes collected within the tax rate area.

Source: County of San Diego, California Auditor and Controller's Office Notes: Information about estimated actual value of property is not available; the assessed value is based on the most recent sales value and includes secured property only.
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 Taxable Assessed Property Value
Last Ten Fiscal Years
(in millions)
Residential Property Commercial Property Industrial Property 171
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■ ■ ■
Direct and Overlapping Property Tax Rates
Last Ten Fiscal Years
(rate per $100 of assessed value)
Fiscal
Year
City of
Carlsbad
Total Direct
Rate2
Carlsbad
Unified
School
District
San Diego
County
Educational
Revenue
Augmentation
Fund
Mira Costa
Community
College
Tri City
Hospital
District
All Other
Rates
Total Prop
13 Rate3
Voter
Approved
Debt4
Total Tax
Rate5
2012-13 0.1927% 0.3412% 0.1576% 0.1497% 0.0937% 0.0198% 0.0453% 1.0000% 0.0768% 1.0768% 2013-14 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0743 1.0743 2014-15 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0710 1.0710 2015-16 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0681 1.0681 2016-17 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0563 1.0563 2017-18 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0791 1.0791 2018-19 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0758 1.0758 2019-20 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.1015 1.1015 2020-21 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0999 1.0999 2021-22 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0961 1.0961 2022-23 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0827 1.0827 1 Area 09000 was chosen as the most representative for the city. 2 The city has no general obligation bonds; therefore the Basic Tax Rate is the same as the Total Direct Tax Rate. 3 In 1978, California voters passed Proposition 13 which limited property taxes to a total maximum rate of 1.00% based on the assessed value of each property being taxed. This 1.00% is shared by all taxing agencies within a tax rate area.

Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only reassessed at the time that it is sold to a new owner. At that point, the purchase price of the property becomes the new assessed value.
4 The majority of voter approved debt is related to various school district and hospital bonds. 5 The Total Tax Rate is the 1.00% Proposition 13 rate plus the Voter Approved Debt rate.

Allocation of 1% Ad Valorem Property Taxes
Overlapping Rates for Tax Rate Area 090001
Source: County of San Diego, California Auditor and Controller's Office The tax rate history above is for Tax Rate Area 09000, which has the highest total assessed value of the all the tax rate areas in the city. Tax Rate 172
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Direct and Overlapping Property Tax Rates (continued)
Last Ten Fiscal Years
(rate per $100 of assessed value)
Total Tax
Rates1
County
Tax Rate
Areas2
Carlsbad
Unified
Schools
Oceanside
Unified
Schools
San Marcos
Unified
Schools
Vista
Unified
Schools
Encinitas
Union
Schools
Mira Costa
Comm.

College
Palomar
Comm.

College
Palomar
Health
District
MWD /
SDCWA3
Total Voter
Approved
Rates4

1.0509% 1 0.0000% 0.0000% 0.0000% 0.0000% 0.0374% 0.0136% 0.0000% 0.0000% 0.0000% 0.0509%

1.0544 35 - - - - 0.0374 0.0136 - - 0.0035 0.0544

1.0599 3 - - - - 0.0374 - 0.0191 - 0.0035 0.0599

1.0697 1 - - 0.0527 - - 0.0136 - - 0.0035 0.0697

1.0752 24 - - 0.0527 - - - 0.0191 - 0.0035 0.0752

1.0792 3 0.0657 - - - - 0.0136 - - - 0.0792

1.0827 54 0.0657 - - - - 0.0136 - - 0.0035 0.0827

1.0882 3 0.0657 - - - - - 0.0191 - 0.0035 0.0882

1.1005 5 - - - 0.0780 - - 0.0191 - 0.0035 0.1005

1.1067 1 - - 0.0527 - - 0.0136 - 0.0370 0.0035 0.1067

1.1105 1 - 0.0934 - - - 0.0136 - - 0.0035 0.1105

1.1122 11 - - 0.0527 - - - 0.0191 0.0370 0.0035 0.1122

1.1197 1 0.0657 - - - - 0.0136 - 0.0370 0.0035 0.1197 1 The Total Tax Rate is the 1.00% Proposition 13 rate plus the Voter Approved Debt rate. 2 Tax rate areas are determined by the County of San Diego. There are currently thirteen tax rates distributed among the 143 tax rate areas of the city.

The table above shows the number of tax rate areas affected by each of the rates. 3 MWD is the Metropolitan Water District and SDCWA is the San Diego County Water Authority. 4 The majority of voter approved debt is related to various school district and hospital bonds.

Fiscal Year 2022-23 Voter Approved Debt Tax Rates for all Rate Areas Source: County of San Diego, California Auditor and Controller's Office 173
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Principal Property Taxpayers
Current Year and Nine Years Ago
Taxpayer
Taxable Assessed
Value Rank
Percentage
of Total City
Net
Assessed
Value
Taxable Assessed
Value Rank
Percentage
of Total City
Net
Assessed
Value
Poseidon Water Desalination Plant 409,666,576$ 1 1.05% -$ 0.00% Legoland California, LLC 327,820,135 2 0.84 154,474,945 4 0.66 La Costa Glen Retirement Community 292,107,310 3 0.75 237,951,989 1 1.01 La Costa Resort & Spa 266,638,245 4 0.68 154,564,293 3 0.66 Levine Investments Limited Partnership 188,270,008 5 0.48 The Forum Shopping Center 185,000,000 6 0.47 183,294,000 2 0.78 The Shoppes at Carlsbad 184,003,800 7 0.47 Grand Pacific Carlsbad 178,539,906 8 0.46
La Costa Town Center, LLC 167,627,497 9 0.43 Carlsbad Premium Outlets 136,151,236 10 0.35 119,247,590 6 0.51 Pacific View Apartments 121,068,995 5 0.51 Park Hyatt Aviara Resort 109,000,000 7 0.46 Westfield Plaza Camino Real 106,242,991 8 0.45 HG Fenton Company 82,289,360 9 0.35
Eaves by Avalon Apartment Homes 81,151,200 10 0.34 Total 2,335,824,713$ 5.96% 1,349,285,363$ 5.74% Net assessed valuation 39,165,587,905$ 23,522,746,301$ Source: County of San Diego, California Assessor's Office 2023 2014
174
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Property Tax Levies and Collections
Last Ten Fiscal Years
Fiscal Year
Total Tax Levy for
Fiscal Year1 Amount2
Percentage of
Levy
Collections in
Subsequent Years Amount
Percentage of
Levy
2013-14 $55,883,499 $55,042,944 98.50% $527,889 $55,570,833 99.44% 2014-15 60,266,230 59,509,285 98.74 553,135 60,062,420 99.66 2015-16 63,363,527 62,595,504 98.79 499,058 63,094,562 99.58 2016-17 67,116,590 66,233,111 98.68 582,089 66,815,200 99.55 2017-18 70,221,876 69,383,391 98.81 570,803 69,954,194 99.62 2018-19 74,560,530 73,518,065 98.60 617,798 74,135,863 99.43 2019-20 78,446,259 77,076,471 98.25 969,436 78,045,907 99.49 2020-21 82,787,902 81,504,185 98.45 732,233 82,236,418 99.33 2021-22 86,318,392 84,678,789 98.10 596,589 85,275,378 98.79 2022-23 93,757,415 91,921,624 98.04 N/A 91,921,624 98.04 1 Includes real property transfer taxes, homeowner exemptions and Proposition 172 public safety sales taxes. 2 Total collections include secured, unsecured, homeowners' exception and supplementary amounts distributed by the county.

Collections within the
Fiscal Year of the Levy Total Collections to Date
Source: County of San Diego, California Auditor and Controller's Office $0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100
2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 Property Tax Levies & Collections
Last Ten Fiscal Years
(in millions)
Total Tax Levy for Fiscal Year1 Total Collections to Date 175
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176
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Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
(dollars in thousands except per capita)
Fiscal
Year Leases
Subscription
Based
Information
Technology
Arrangements
Bonds/
Special Debt1
Installment
Purchase
Agreements Loan Payable2 Total
Percentage of
Personal
Income Per Capita
2013-14 -$ -$ 16,645$ 905$ 19,837$ 37,387$ 0.77% 339.36$ 2014-15 - - 16,260 - 18,429 34,689 0.71 313.49 2015-16 970 - 16,058 - 17,670 34,698 0.60 307.25 2016-17 784 - - 4 - 15,901 16,685 0.28 146.71 2017-18 588 - - - 14,944 15,532 0.24 135.51 2018-19 378 - - - 16,827 17,205 0.25 149.30 2019-20 156 - - - 15,327 15,483 0.25 135.27 2020-21 - - - - 13,750 13,750 0.18 119.05 2021-22 22 - - - 12,444 12,466 0.14 107.85 2022-23 238 2,929 - - 10,792 13,959 0.14 121.86 Notes: Details regarding the city's outstanding debt can be found in the notes to the financial statements.

Sources: MuniServices, LLC, California Department of Finance and US Census Data Governmental Activities Business-Type Activities
1 Bond/Special Debt is net of amortized premiums.
2 The State Water Resources Control Board issued low interest loans for the Carlsbad Water Recycling Facility in 2005, 2006 and 2014. Varying amounts of principal and interest are due annually. Payments are funded from recycled water user fees. 3 During FY 2006-07, Carlsbad Municipal Golf Course Revenue Bonds were issued for $18.5 million. 4 The Carlsbad Municipal Golf Course Revenue Bonds were defeased during FY 2016-17. $339 $313 $307
$147 $136 $149 $135 $119 $108 $122
$0
$200
$400
$600
2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 Outstanding Debt per Capita
Last Ten Fiscal Years
(in dollars)
177
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Schedule of Direct and Overlapping Bonded Debt
Current Fiscal Year
Fiscal Year 2022-23 Assessed Valuation: $40,962,813,358 Redevelopment Incremental Valuation: 1,797,225,453
Adjusted Assessed Valuation: $39,165,587,905
Total Debt City’s Share of
Overlapping Tax and Assessment Debt: 06/30/23 Debt 6/30/23 Metropolitan Water District $19,215,000 1.13% $217,130
Mira Costa Community College District 376,155,000 27.62 103,890,249 Palomar Community College District 641,965,146 2.68 17,172,568 Carlsbad Unified School District 281,046,297 98.23 276,066,157 Carlsbad Unified School District Community Facilities District No. 1 980,000 100.00 980,000 Oceanside Unified School District 290,311,210 0.00 11,612 Vista Unified School District 232,339,882 0.82 1,909,834 Encinitas Union School District 42,125,407 29.33 12,353,697 San Marcos Unified School District 268,478,476 17.64 47,354,234 San Marcos Unified School District Community Facilities District No. 4 12,590,000 32.76 4,123,855 San Marcos Unified School District Community Facilities District No. 5 10,705,000 100.00 10,705,000 San Dieguito Union High School District 416,410,000 8.66 36,052,778 San Dieguito Union High School District Community Facilities District No. 94-2 22,110,000 98.34 21,743,637 San Dieguito Union High School District Community Facilities District No. 95-2 5,400,000 8.81 475,902 Palomar Health District 400,167,282 1.63 6,534,732 Olivenhain Municipal Water District, Assessment District No. 96-1 4,605,000 23.53 1,083,649 City of Carlsbad Community Facilities District No. 3, I.A. No. 1 & No. 2 16,315,000 100.00 16,315,000 City of Carlsbad 1915 Act Bonds 17,905,000 100.00 17,905,000 Total Overlapping Tax and Assessment Debt $3,058,823,700 $574,895,034 Source: MuniServices, LLC and County of San Diego, California Auditor and Controller's Office 1 Percentage of overlapping agency's assessed valuation located within boundaries of the city.

Percent
Applicable1
178
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Schedule of Direct and Overlapping Bonded Debt (CONTINUED) Current Fiscal Year
Total Debt City’s Share of
Overlapping General Fund Obligation Debt: 06/30/23 Debt 6/30/23 San Diego County General Fund Obligations $229,680,000 6.26% $14,380,265 San Diego County Pension Obligation Bonds 277,990,000 6.26 17,404,954 San Diego County Superintendent of Schools General Fund Obligations 6,935,000 6.26 434,200 Palomar Community College District General Fund Obligations 1,310,000 2.68 35,043 Carlsbad Unified School District General Fund Obligations 58,370,000 98.23 57,335,684 San Marcos Unified School District General Fund Obligations 67,817,862 17.64 11,961,714 Vista Unified School District Certificates of Participation 36,615,000 0.82 300,975 San Dieguito Union High School District General Fund Obligations 12,730,000 8.66 1,102,163 Total Overlapping General Fund Obligation Debt $691,447,862 $102,954,998 Overlapping Tax Increment Debt (Successor Agency): 1,000,000 100.00 1,000,000 2

Total Overlapping Debt: 3,751,271,562$ 678,850,032$ City of Carlsbad Direct Debt:

City of Carlsbad Governmental Activities Obligations 3,166,970$ 100.00 3,166,970$ Total City of Carlsbad Direct Debt 3,166,970$ 3,166,970$ Combined Total Debt 3,754,438,532$ 682,017,002$
3 Source: MuniServices, LLC and County of San Diego, California Auditor and Controller's Office 1 Percentage of overlapping agency's assessed valuation located within boundaries of the city. 2 Created by the dissolution of the Redevelopment Agency in FY 2011-12. 3 Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds.

Ratios to FY 2022-23 Assessed Valuation:

Total Overlapping Tax and Assessment Debt 1.47%
Ratios to FY 2022-23 Adjusted Assessed Valuation:

Governmental Activities Direct Debt 0.0081%
Combined Total Debt 1.74%
Percent
Applicable1
179
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Direct and Overlapping Debt
Last Ten Fiscal Years
(rate per $1,000 of assessed value)
2013-14 2014-15 2015-16
Overlapping Tax and Assessment Debt:

Metropolitan Water District 0.062$ 0.049$ 0.039$ Mira Costa Community College District - - - Palomar Community College District 0.361 0.562 0.520 Carlsbad Unified School District 7.921 7.073 6.370 Carlsbad Unified School District CFD No. 1 0.052 - - Oceanside Unified School District - - - Vista Unified School District 0.028 0.025 0.022 Encinitas Union School District 0.426 0.385 0.515 San Marcos Unified School District 2.248 2.087 1.922 San Marcos Unified School District Facility Improvement District 0.057 0.035 0.027 San Marcos Unified School District CFD No. 4 0.292 0.254 0.232 San Marcos Unified School District CFD No. 5 0.864 0.690 0.626 San Dieguito Union High School District 0.607 0.967 0.906 San Dieguito Union HS District CFD No. 94-1 0.004 0.003 0.003 San Dieguito Union HS District CFD No. 94-2 1.032 0.928 0.855 San Dieguito Union HS District CFD No. 95-2 0.023 0.021 0.019 Palomar Health District 0.336 0.308 0.285 Olivenhain Municipal Water District, Assess. Dist. No. 96-1 0.139 0.031 0.102 City of Carlsbad CFD No. 3, I.A. No. 1 & No. 2 1.000 0.903 0.836 City of Carlsbad 1915 Act Bonds 2.018 1.727 1.564 Total Overlapping Tax and Assessment Debt 17.470$ 16.048$ 14.843$ Overlapping General Fund Obligation Debt:

San Diego County General Fund Obligations 0.983$ 0.857$ 0.709$ San Diego County Pension Obligation Bonds 1.865 1.664 1.497 San Diego City Superintendent of Schools General Fund Obligations 0.042 0.036 0.031 Mira Costa Community College District Certificates of Participation 0.023 0.018 0.014 Palomar Community College District General Fund Obligations 0.006 0.005 0.004 Carlsbad Unified School District General Fund Obligations 2.086 1.846 1.692 San Marcos Unified School District General Fund Obligations 0.441 0.407 0.376 Vista Unified School District Certificates of Participation 0.001 0.001 0.001 San Dieguito Union High School District General Fund Obligations 0.049 0.047 0.044 Total Overlapping General Fund Obligation Debt 5.496$ 4.881$ 4.368$ Overlapping Tax Increment Debt (Successor Agency): 0.341$ 0.290$ 0.250$ Total Overlapping Debt: 23.307 21.219 19.461 City of Carlsbad Direct Debt:

City of Carlsbad Governmental Activities Obligations - - 0.036 Total City of Carlsbad Direct Debt -$ -$ 0.036$ Combined Total Debt 23.307$ 21.219$ 19.497$ Source: MuniServices, LLC and County of San Diego, California Auditor and Controller's Office 180
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2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23

0.030$ 0.023$ 0.017$ 0.013$ 0.009$ 0.006$ 0.006$ - 0.918 0.750 0.590 2.414 2.210 2.653

0.619 0.571 0.530 0.493 0.498 0.485 0.438

5.816 5.298 7.474 6.944 8.861 7.916 7.049 - 0.051 0.045 0.039 0.035 0.030 0.025 - - - - - - -

0.024 0.018 0.028 0.027 0.027 0.052 0.049

0.551 0.506 0.461 0.421 0.389 0.364 0.315

1.797 1.706 1.571 1.521 1.414 1.343 1.209

0.020 0.014 0.009 0.004 - - -

0.199 0.132 0.164 0.146 0.132 0.121 0.105

0.566 0.360 0.456 0.404 0.360 0.322 0.273

1.031 1.087 0.956 0.925 1.087 1.030 0.921

0.003 - - - - - -

0.983 0.678 0.800 0.736 0.678 0.631 0.555

0.017 0.015 0.018 0.017 0.015 0.014 0.012

0.258 0.196 0.228 0.212 0.196 0.187 0.167

0.091 0.079 0.069 0.058 0.040 0.035 0.028

0.750 0.684 0.623 0.561 0.513 0.473 0.417

1.379 1.240 1.024 0.892 0.786 0.686 0.457

14.134$ 13.576$ 15.223$ 14.003$ 17.454$ 15.905$ 14.679$

0.648$ 0.572$ 0.510$ 0.436$ 0.379$ 0.424$ 0.367$

1.347 1.168 1.016 0.860 0.716 0.590 0.444

0.025 0.023 0.020 0.018 0.015 0.013 0.011

0.119 0.005 0.001 - - - -

0.003 0.002 0.002 0.001 0.001 0.001 0.001

1.598 1.447 1.313 1.176 1.065 1.663 1.464

0.378 0.459 0.421 0.401 0.368 0.346 0.305

0.001 - - - - 0.008 0.008

0.041 0.039 0.036 0.034 0.032 0.031 0.028

4.160$ 3.715$ 3.319$ 2.926$ 2.576$ 3.076$ 2.628$

0.212$ 0.177$ 0.143$ 0.110$ 0.090$ 0.058$ 0.030$

18.506 17.468 18.685 17.039 20.120 19.039 17.337

0.028 0.020 0.012 0.005 - 0.001 0.081

0.028$ 0.020$ 0.012$ 0.005$ -$ 0.001$ 0.081$

18.534$ 17.488$ 18.697$ 17.044$ 20.120$ 19.040$ 17.418$ 181
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Legal Debt Margin Information
Last Ten Fiscal Years
(dollars in thousands)
2013-14 2014-15 2015-16 2016-17
Net assessed valuation 23,522,746$ 25,489,468$ 26,924,891$ 28,423,782$ Debt limit (25% x 15%) 882,103 955,855 1,009,683 1,065,892 Less amount of debt applicable to limit:

Bonded debt 16,645 16,260 15,855 - 1 Loan payable - - - - Lease obligations - - 970 785 Subscription based information
technology arrangements - - - - Total net debt applicable to limit 16,645 16,260 16,825 785 Legal debt margin 865,458$ 939,595$ 992,858$ 1,065,107$ Total net debt applicable to the limit
as a percentage of debt limit 1.89% 1.70% 1.67% 0.07%
Source: City of Carlsbad Annual Comprehensive Financial Reports 1 The golf course bonds were defeased during FY 2016-17.

Note: Under state finance law, the city's outstanding general obligation debt should not exceed 15% (as adjusted by 25% per the law) of total assessed property value. By law, the general obligation debt subject to the limitation may be offset by amounts set aside for repaying general obligation bonds.

1.89%

1.70% 1.67%

0.07% 0.05% 0.03% 0.01% 0.00% 0.00%

0.22%

0.00%

1.00%

2.00%

3.00%

4.00%
2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 Percent of Debt Applicable to the Legal Debt Limit
Last Ten Fiscal Years
182
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{ city of
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2017-18 2018-19 2019-20 2020-21 2021-22 2022-23
29,994,964$ 31,635,528$ 33,655,907$ 35,217,379$ 36,362,069$ 39,165,588$ 1,124,811 1,186,332 1,262,097 1,320,652 1,363,578 1,468,710 - - - - - - - - - - - - 588 378 156 - 22 238 - - - - - 2,929 588 378 156 - 22 3,167 1,124,223$ 1,185,954$ 1,261,941$ 1,320,652$ 1,363,556$ 1,465,543$

0.05% 0.03% 0.01% 0.00% 0.00% 0.22%
183
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Pledged-Revenue Coverage
Last Ten Fiscal Years
2013-14 2014-15 2015-16 2016-17
Wastewater Revenue Bonds
Gross revenues 1, 5 13,699,286$ 13,723,835$ 13,723,835$ -$ Less expenses 2, 5 6,989,194 7,249,798 7,249,798 - Net available revenue 6,710,092$ 6,474,037$ 6,474,037$ -$ Debt service
Principal 5 860,000$ 905,000$ 905,000$ -$ Interest 5 68,419 23,191 - - Total debt service 928,419$ 928,191$ 905,000$ -$ Coverage 7.23 6.97 7.15 n/a Recycled Water Loans
Gross revenues 3 9,392,061$ 9,210,258$ 8,216,362$ 8,371,467$ Less expenses 4 3,640,786 3,826,699 4,679,706 4,863,054 Net available revenue 5,751,275$ 5,383,559$ 3,536,656$ 3,508,413$ Debt service
Principal 1,375,337$ 1,407,932$ 1,441,301$ 1,475,461$ Interest 501,144 468,550 435,182 401,021 Total debt service 1,876,481$ 1,876,482$ 1,876,483$ 1,876,482$ Coverage 3.06 2.87 1.88 1.87 Golf Course Revenue Bonds
Gross revenues 1, 6 7,747,116$ 8,428,375$ 8,196,853$ -$ Less expenses 2, 6 6,125,159 6,302,019 6,273,320 - Net available revenue 1,621,957$ 2,126,356$ 1,923,533$ -$ Debt service
Principal 6 360,000$ 385,000$ 405,000$ -$ Interest 6 755,850 739,088 721,313 - Total debt service 1,115,850$ 1,124,088$ 1,126,313$ -$ Coverage 1.45 1.89 1.71 n/a Source: City of Carlsbad Annual Comprehensive Financial Reports 1 Includes operating and non-operating revenues and transfers in from the General Fund. 2 Includes operating and non-operating expenses, excluding interest expense and depreciation. 5 Debt service on the wastewater revenue bonds was completed during FY 2015-16. 6 The golf course bonds were defeased during FY 2016-17. 3 Includes water (potable and recycled) operating and non-operating revenues and fees. In FY 2020-21 the State Water Resources Board confirmed the pledged revenue includes potable, which was excluded in prior years. 4 Includes water (potable and recycled) operating and non-operating expenses, excluding interest expense and depreciation. In FY 2020-21 the State Water Resources Board confirmed the pledged revenue includes potable, which was excluded in prior years. 184
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{ City of
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2017-18 2018-19 2019-20 2020-21 2021-22 2022-23
-$ -$ -$ -$ -$ -$ - - - - - - -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ - - - - - - -$ -$ -$ -$ -$ -$ n/a n/a n/a n/a n/a n/a
9,869,958$ 8,198,882$ 7,557,893$ 56,446,838$ 3,4 56,363,973$ 55,494,378$ 5,559,509 6,472,817 5,926,215 50,079,801 3,4 53,308,298 48,058,823 4,310,449$ 1,726,065$ 1,631,678$ 6,367,037$ 3,055,675$ 7,435,555$ 1,510,433$ 1,546,234$ 1,582,886$ 1,620,408$ 1,658,821$ 1,738,405$ 366,049 330,248 293,596 256,074 217,661 138,077 1,876,482$ 1,876,482$ 1,876,482$ 1,876,482$ 1,876,482$ 1,876,482$

2.30 0.92 0.87 3.39 1.63 3.96 -$ -$ -$ -$ -$ -$ - - - - - - -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ - - - - - - -$ -$ -$ -$ -$ -$ n/a n/a n/a n/a n/a n/a
185
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Demographic and Economic Statistics
Last Ten Fiscal Years
Year
Total
Population
% of S.D.

County
Population
% Change from
Previous Year
% High
School
Graduate
% Bachelor's
Degree or
Higher Median Age
2013-14 110,169 3.45% 1.78% 95.6% 51.3% 40.3
2014-15 110,653 3.43 0.44 96.0 51.9 41.1
2015-16 112,930 3.43 2.06 95.6 54.8 42.1
2016-17 113,725 3.43 0.70 95.8 54.2 41.9
2017-18 114,622 3.43 0.79 95.7 55.0 42.3
2018-19 115,241 3.44 0.54 95.7 58.1 42.6
2019-20 114,463 3.42 -0.68 95.0 59.5 44.4
2020-21 115,501 3.48 0.91 95.2 59.5 42.9
2021-22 115,585 3.52 0.07 97.1 60.4 41.8
2022-23 114,549 3.50 -0.90 100.0 62.6 40.5
Sources: MuniServices, LLC/Avenu Insights & Analytics, U.S. Census Bureau Population projections are from the California Department of Finance 2 Unemployment increase in FY 2019-20 is due to the COVID-19 pandemic.

Educational Attainment
1 Personal income is the estimated total aggregate income for the total population.

Unemployment rate estimates are from the California Employment Development Department, Bureau of Labor Statistics.

Household and demographic characteristics estimates are from the United States Census Data Sets Tables. 186
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( city of
Carlsbad
Average
Household
Size
Personal
Income
(millions) 1
Per Capita
Personal
Income
City
Unemployment
Rate

2.53 4,862$ 44,134$ 6.3%

2.30 4,907 44,345 4.30

2.68 5,741 50,838 5.20

2.58 6,060 53,285 4.20

2.60 6,496 56,675 3.00

2.60 6,889 59,780 2.60

2.60 6,101 53,300 13.50 2

2.38 7,751 67,111 8.11

2.39 8,910 77,085 2.40

2.50 10,299 89,912 3.50
Population projections are from the California Department of Finance Unemployment rate estimates are from the California Employment Development Department, Bureau of Labor Statistics.

Household and demographic characteristics estimates are from the United States Census Data Sets Tables. 187
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Principal Employers
Current Fiscal Year and Nine Years Ago
Employer Industry Employees Rank
% of Total City
Employment Employees Rank
% of Total City
Employment
ViaSat, Inc. Information Technology 4,010 1 5.28% 1,700 1 1.89% Thermo Fisher Scientific Life Sciences 2,332 2 3.07%
Legoland California Hospitality/Tourism 2,300 3 3.03% 1,422 4 1.58% Carlsbad Unified School District Education 1,097 4 1.44% 975 5 1.08% Omni La Costa Resort & Spa Hospitality/Tourism 900 5 1.18% 932 6 1.04% City of Carlsbad Government 807 6 1.06% 670 10 0.74%
Ionis Pharmaceuticals Life Sciences 785 7 1.03%
Gemological Institute of America Research/Education 766 8 1.01% 723 9 0.80% Park Hyatt Aviara Hospitality/Tourism 566 9 0.74%
Zodiac Pool Systems LLC Manufacturing 535 10 0.70%
Callaway Golf Company Action Sports 1,637 2 1.82%
Thermo Fisher Scientific Life Sciences 1,454 3 1.62%
TaylorMade Golf Company Action Sports 868 7 0.96%
OptumRx, Inc. Pharmaceutical 785 8 0.87%
Subtotal Employees 14,098 18.55% 11,166 12.41%
Total Employees Citywide (estimate) 76,000 90,000
Source: City of Carlsbad Business License Data
Fiscal Year 2022-23 Fiscal Year 2013-14
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( city of
Carlsbad
Authorized Full-Time and 3/4-Time City Government Employees by Program Area Last Ten Fiscal Years
Program Area 2013-14 2014-15 2015-16 2016-17
Policy and Leadership Group
City Attorney 7.00 7.00 7.00 6.00 City Clerk Services 5.00 5.00 5.00 5.00 City Council 1.00 1.00 1.00 1.00 City Manager 7.00 7.00 7.00 8.00 City Treasurer 0.75 0.75 0.75 0.75 Communications & Engagement 2.75 4.75 1 5.00 5.00 Administrative Services
Administration - - - - Finance 31.50 31.50 32.50 33.00 Human Resources 9.00 11.00 11.00 11.00 Information Technology 22.50 22.50 19.50 20.00 Innovation & Economic Development - - - - Public Safety
Police 161.00 162.00 168.00 168.00 Fire 88.00 89.00 89.00 90.00 Community Services
Community Services Administration - - - - Community Development 44.00 44.00 44.00 44.00 Housing & Homeless Services 10.00 12.00 13.00 13.00 Library & Cultural Arts 51.25 50.25 1 50.50 50.50 Parks & Recreation 67.60 61.60 1 58.15 57.15 Public Works
Construction Management & Inspection - - - - Environmental Management - - 8.50 2 9.50 2 Fleet & Facilities - - - - General Services 40.60 39.90 28.10 2 51.30 2 Public Works Administration - - 8.05 2 9.85 2 Transportation 53.40 55.90 57.35 2 33.00 2 Utilities 65.40 64.60 60.85 2 60.20 2 Limited Term Personnel (Full-Time) 2.00 - 3.75 6.75 Total Full Time Authorized Employees 669.75 669.75 678.00 683.00 Net Increase/(decrease) over prior year (4.75) - 8.25 5.00 Source: City of Carlsbad Operating Budget
Notes: Table Includes both full-time and 3/4 time employees A full-time employee is scheduled to work 2,080 hours per year (including vacation and sick-leave).

A 3/4 time employee is scheduled to work 1,560 hours per year (including vacation and sick-leave). 1 During FY 2014-15, the Policy and Leadership and Community Services divisions were reorganized. 2 During FY 2015-16, FY 2016-17, FY 2019-20 and FY 2020-21, the Public Works division restructured divisions. 3 During FY 2018-19, Police IT was consolidated with city IT, resulting in the transfer of 5.0 FTEs. 4 During FY 2018-19, Housing & Neighborhood Services was combined with Community Development. 5 During FY 2020-21, employees were moved from City Manager and Community Development to create a new office of Innovation & Economic Development and Community Services Administration. 6 During FY 2021-22, Housing & Homeless Services was established. 7 During FY 2022-23, all Business Systems Specialists were transferred from several separate departments to the Information Technology Department. Separately, all employees in the Geographic Information Systems division in the Information Technology Department were transferred to the Innovation & Economic Development Department. 8 During FY 2022-23, one 5-year Limited Term Park Planner position was added to the Parks & Recreation Department and one 5-year Limited Term Senior Engineer position was added to the Fleet & Facilities Department. 190
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{city of
Carlsbad
2017-18 2018-19 2019-20 2020-21 2021-22 2022-23

7.00 7.00 8.00 8.00 8.00 8.00

6.00 6.00 7.00 7.00 7.00 7.00

1.00 1.00 2.00 2.00 2.00 2.00

8.00 9.00 12.00 7.00 5 7.00 5 7.00

0.75 0.75 1.00 1.00 1.00 1.00

5.00 5.00 7.00 7.00 9.00 9.00 - - - - 3.00 3.00

32.00 32.00 31.00 31.00 28.00 26.00

11.00 11.00 17.00 17.00 17.00 18.00

27.00 32.00 3 35.00 37.00 37.00 43.00 7 - - 2.00 4.00 5 4.00 5 9.00 7 168.00 169.00 3 184.00 184.00 186.00 187.00

90.00 90.00 97.75 97.75 112.00 123.00 - - - 3.00 5 3.00 5 3.00

44.00 58.00 4 63.00 61.75 5 53.00 5 52.00

13.00 - 4 - - 14.00 16.00

50.50 50.50 52.50 52.50 53.00 51.00

57.00 55.00 55.00 55.00 55.00 58.00 - - - 15.20 2 15.20 2 16.20

9.70 9.60 11.05 11.95 17.95 17.60 - - - 34.05 2 37.05 2 33.95

52.00 53.00 47.85 2 - - -

12.30 7.65 7.60 7.85 7.85 5.90

32.00 35.00 44.15 2 41.75 41.75 43.60

59.00 61.75 62.10 61.95 63.95 64.50

7.75 4.75 0.75 - - 2.00 8 693.00 698.00 747.75 747.75 782.75 806.75

10.00 5.00 49.75 - 35.00 24.00 191
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Operating Indicators by Function/Program
Last Ten Fiscal Years
2013-14 2014-15 2015-16 2016-17
General Government
Number of applications processed (full and part-time) 9,527 8,551 8,037 9,544 Number of external new hires (full and part-time) 284 299 260 292 Number of internal promotions / transfers (full-time only) 47 41 31 58 Business licenses processed 10,327 10,735 11,449 8,142 3 Number of outgoing payments processed 39,310 40,663 41,398 41,304 Public Safety
Police
Calls for service 87,976 91,314 92,061 84,858 Average priority one response (minutes) 5.8 6.5 6.1 5.9 Cases 8,296 8,349 9,253 8,884 Fire
Incidents 9,925 9,830 11,455 12,183 Response time: arrivals on scene within goal standard 63% 63% 64% 78% Turnout time: time from request to first unit in-route within standard - - - - Community Development
Affordable housing units completed - - - - Financial assistance to affordable housing projects -$ 2,646,000$ -$ 1,280,000$ Building permits issued 1,400 1,600 3,000 4,500 Building inspections conducted 19,000 21,000 23,000 27,000 Final inspections (residential dwelling units) 190 200 200 600 Final inspections (commercial square feet) 45,000 60,000 60,000 95,000 Code Enforcement Actions (activities) 4,794 5,389 10,994 n/a 4 Community Services
Library - total material circulation 1,369,369 1,293,282 1,103,090 1,243,228 Library - patron visits 791,533 804,003 609,679 2 720,205 Cultural Arts - number of events 62 80 88 79 Arts - attendance of events 75,000 87,000 85,000 79,067 Recreation - youth sports participants 2,292 1,000 1,000 968 Recreation - adult sports participants 5,600 6,150 5,600 4,500 Recreation - enrichment class enrollees 10,350 19,030 1 19,632 17,402 Recreation - special events participants 13,600 17,841 1 19,474 12,150 Recreation - aquatics classes conducted 1,018 1,224 684 733 Trees trimmed 1,920 2,018 1,965 1,971 Public Works
Streets
Centerline road miles resurfaced with overlay or slurry seal 18.1 14.8 18.1 20.0 Carlsbad Municipal Water District
Average consumption (millions of gallons per day) 15.9 14.6 12.1 13.1 Annual water deliveries (acre feet) 17,801 16,368 13,578 14,616 5 Water connections 29,045 29,190 29,190 29,782 Wastewater
Sewage pumped (millions of gallons per day) 6.53 5.90 6.17 5.82 Annual flow (millions of gallons) 2,384 2,152 2,252 2,125 Wastewater connections 23,282 23,431 23,431 23,747 Source: City of Carlsbad
1 Increases in the number of enrichment class and special events participants are the results of overall higher attendance and including recategorized classes previously not classified or included as enrichment classes or special events in prior years. 2 The decrease in patron visits is due to the temporary closures of library facilities for remodeling during FY 2015-16. 3 The decrease is due to the time involved with the implementation of a new licensing system during FY 2016-17. 4 Reporting of information is not available for FY 20167-17 due to the implementation of a new permitting system. 5 Beginning in FY 2016-17, 2,500 acre feet of contracted desalinated water is included in the water purchase totals. 6 FY 2019-20 and FY 2020-21 had decreases in some public facing programs and services due to the impacts of the COVID-19 pandemic. 7 Beginning in FY 2022-23, the Fire Department began reporting turnout time instead of response time as a performance measure. 192
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{city of
Carlsbad
2017-18 2018-19 2019-20 2020-21 2021-22 2022-23
9,455 8,495 8,012 5,469 6,578 5,524 311 345 248 198 376 354 44 66 66 24 79 84 11,267 9,546 10,180 10,164 9,736 9,652 41,869 43,520 44,128 41,164 41,315 41,746 90,760 99,562 112,323 110,448 107,156 103,192

5.8 5.7 5.5 5.2 5.2 5.1 8,643 8,705 8,774 8,222 8,704 8,348 12,520 12,833 13,331 12,345 13,837 15,298 76% 76% 75% 75% 70% - 7
- - - - - 93.7% 7 - - 157 119 48 - -$ -$ -$ 8,300,000$ 5,250,000$ 2,265,000$ 4,392 4,884 4,464 4,645 4,562 5,633 22,671 21,527 21,209 17,044 14,664 16,693 289 215 268 309 323 365 155,292 2,350,975 365,644 403,397 141,285 567,745 9,538 8,154 7,360 6,443 8,065 9,732 1,169,247 1,185,390 975,024 6 536,078 6 1,033,006 1,118,282 685,188 668,973 483,233 6 20,214 6 372,671 426,470 82 96 51 6 135 6 159 202 65,817 61,531 37,913 6 9,724 6 20,844 14,758 1,003 1,260 993 6 - 6 1,428  3,763 4,800 4,800 2,400 6 - 6 1,714  890 12,996 17,900 9,641 6 3,270 6 16,540  23,687 11,645 9,600 3,705 6 300 6 8,575  8,675 778 830 770 6 715 6  1,061 754 1,954 4,340 4,678 4,500  3,025 4,179

23.8 25.8 8.3 14.9 - 24.5

14.3 13.0 12.7 13.5 13.2 12.0 16,032 14,563 14,249 14,731 14,787 13,451 30,054 30,131 30,265 30,439 29,446 29,426

6.32 6.03 6.31 6.27 5.75 6.22 2,306 2,200 2,305 2,288 2,097 2,270 23,863 23,959 24,040 24,103 24,096 24,079 193
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Capital Asset Statistics
Last Ten Fiscal Years
2013-14 2014-15 2015-16 2016-17
Community Services
Number of parks and community fields 33 33 33 33 Acres of developed parks and community fields 281 319 319 319 Acres of open space and community fields 728 728 728 728 Miles of open space trails 47 47 47 47 Number of pools 3 3 3 3 Number of community centers 4 4 4 4 Number of libraries 3 3 3 3 Number of Materials in Library Collections 581,865 574,775 563,581 491,956 Public Safety
Fire Protection
Number of stations 6 6 6 6 Number of fire trucks 13 12 12 12 Number of ambulances 8 7 6 5 Number of other fire vehicles 16 15 18 20 Police Protection
Number of patrol and other vehicles 114 114 106 106 Number of motorcycles 13 14 15 12 Public Works
Carlsbad Municipal Water District
Miles of pipeline 534 534 559 559 Wastewater
Miles of sewers 288 288 288 288 Streets
Miles of streets 346 347 348 349 Number of street lights 7,236 7,262 7,265 7,334 Number of traffic signals 174 177 177 177 Source: City of Carlsbad
1 During FY 2018-19, the number of vehicles was updated to include both active and reserve vehicles. 2 In FY 2019-20, a change in the reporting methodology was implemented to include all first responder vehicles. 3 In FY 2019-20, only active lines were counted. Prior years included abandoned and future lines. 194
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{ city of
Carlsbad
2017-18 2018-19 2019-20 2020-21 2021-22 2022-23
33 33 33 33 34 34 319 319 319 322 339 339 728 787 802 817 963 963 47 52 52 67 51 52 3 3 3 3 3 3 5 5 5 5 5 5 3 3 3 3 3 3 477,149 473,154 477,042 497,407 478,825 316,962
6 6 1 6 6 6 7 13 14 1 13 2 13 15 14 5 5 1 6 2 6 10 12 20 25 1 25 2 27 27 26 96 119 1 119 119 134 164 13 13 1 15 15 15 14 559 559 535 3 535 549 554 288 288 272 265 265 273 349 349 349 349 349 349 7,337 7,388 7,520 7,527 8,838 8,841 178 179 181 181 194 198 195
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