AGENDA
City Council Meeting Council Chamber, Chowchilla City Hall 130 S. 2nd Street, Chowchilla, CA 93610
Tuesday, April 22, 2025
Closed Session: 3:00 p.m. | Open Session: 4:00 p.m.
Agendas for all City Council meetings are posted at least 72 hours prior to the meeting in the kiosk just outside of City Hall, 130 S. Second St., Chowchilla, CA 93610.
The City of Chowchilla complies with the Americans with Disabilities Act (ADA of 1990). The Council Chambers is accessible to the physically disabled. If you need special assistance, please call (559) 665- 8615, ext. 102, at least 4 days prior to a regular meeting 1 day for a special meeting.
California Levine Act Statement:
California Government Code Section 84308, commonly referred to as the "Levine Act," prohibits any Chowchilla City Council Member from participating in any action related to a license, permit, contract, or entitlement for use application if he or she receives any political contributions totaling more than $500 within the previous twelve months, and for twelve months following the date of a final decision, from the business/board or applicant.
The Levine Act also requires a member of the Chowchilla City Council who has received such a contribution to disclose the contribution on the record of the proceeding.
CALL TO ORDER/ROLL CALL
Mayor: Kelly Smith
Mayor Pro Tem: Jeff Troost
Council Members: Waseem Ahmed, Ray Barragan, John Chavez City staff and contract employees present will be recorded in the minutes.
CONSIDERATION OF APPROVAL OF AGENDA
Additions and/or Deletions:
PUBLIC ADDRESS – CLOSED SESSION
This time is reserved for members of the audience to address the City Council on items listed on the Closed Session agenda only. It is recommended that speakers limit their comments to no more than 3 minutes each.
CLOSED SESSION – 3:00 PM
1. CONFERENCE WITH LABOR NEGOTIATORS
Pursuant to Government Code Section 54957.6
Agency Designated Representatives: City Administrator Rod Pruett Employee Organizations: City Office Employees Association, Chowchilla Police Officer Association, City Employees Association, Mid Management/Confidential Association, and Unrepresented Employees
OPEN SESSION – 4:00 PM
CLOSED SESSION REPORT:
City Council Meeting AGENDA April 22, 2025
PLEDGE OF ALLEGIANCE
INVOCATION:
PRESENTATIONS/WORKSHOP - Section 1
PUBLIC ADDRESS
This time is reserved for members of the audience to address the City Council on items of interest that are not on the agenda and that are within the subject matter jurisdiction of the Council.
It is recommended that speakers limit their comments to no more than 3 minutes each, and it is requested that no comments be made during this period on items on the Agenda. Speakers are not allowed to cede their public comment time.
Members of the public who are joining the meeting via Zoom and would like to address the Council on items on the agenda should follow the policy on page 4 of this agenda packet.
The Council is prohibited by law from taking any action on matters discussed that are not on the agenda.
No adverse conclusions should be drawn if the Council does not respond to public comment at this time.
COUNCIL AND STAFF VERBAL REPORTS – Section 2
2.1 COUNCIL VERBAL REPORTS
Legislative, Collaborative Agency, Ad Hoc
2.2 STAFF VERBAL REPORTS
CONSENT CALENDAR – Section 3
All items listed under Consent Calendar are considered to be routine and will be enacted by one motion.
For discussion of any Consent Item, it will be made a part of the Regular Agenda at the request of any member of the City Council or any person in the audience.
3.1 Approval of the April 8, 2025, Special City Council Goal Setting Workshop Minutes (McClendon)
3.2 Approval of the April 8, 2025 Regular City Council Meeting Minutes (McClendon)
3.3 Consideration and Adoption of a City Council Resolution Approving the Amended Memorandum of Understanding of the Chowchilla Police Officers Association for the Period Covering July 1, 2025 Through June 30, 2028 (Pruett)
3.4 Second Reading and Adoption of an Ordinance Amending Chowchilla Municipal Code Section 2.04.110 – Council Salaries to Increase City Council Member Salaries to the Maximum Allowable Amount (Lerner)
3.5 Informational Item – Quarterly Project Management Update (McClendon)
3.6 Consideration of the Quarterly Fee Waiver Report (Pruett)
3.7 Consideration and Adoption of a City Council Resolution Approving Proposed Adjustments to Chowchilla Police Department Lieutenant, Commander and Police Chief Salary Schedules for the Period of July 1, 2025 Through June 30, 2028 (Lerner) City Council Meeting AGENDA April 22, 2025
PUBLIC HEARINGS – Section 4
4.1 Consideration and Adoption of a City Council Resolution Related to Hearing Protests of any Affected Property Owners and Authorizing the City Administrator to Execute Necessary Documents Thereto (2025 Weed Abatement Program) (Gaumnitz)
4.2 Consideration and Adoption of a City Council Resolution Approving the Close Out of 2020 Community Development Block Grant Program – Coronavirus Response Round 1 (CDBG-CV1) (Quintana)
4.3 Consideration and Adoption of a City Council Resolution Approving the Close Out of 2020 Community Block Grant Program – Coronavirus Response Round 2 and 3 (CDBG-CV2-3) (Quintana)
4.4 Consideration and Adoption of a City Council Resolution Approving the Close Out of the 20-CDBG-12078 Grant Program (Quintana)
DEFERRED BUSINESS – Section 5
NEW BUSINESS – Section 6
6.1 Presentation of the City’s Fiscal Year 2023-2024 Financial Statement Audit (Williams)
6.2 Consideration and Adoption of a City Council Resolution Approving a $5,000 Contribution From the Council Contingency Fund to Support the Chowchilla-Madera County Fairgrounds Annual Fair Event and Authorizing the City Administrator or Designee to Execute Related Documents Thereto (Wisener)
6.3 Confirmation of Direction on Proposed Solid Waste, Water and Sewer Utility Fee Rate Increases; and, Consideration of a Resolution Approving a Date or a Prop 218 Public Hearing for Proposed Solid Waste, Water and Sewer Utility Rate Increases (Williams) ANNOUNCEMENTS – Section 7
APR 25 CAF GOLF TOURNAMENT
APR 27 PORTUGUESE FIESTA & PARADE
MAY 1 NATIONAL DAY OF PRAYER, FAITH HALL, 8:30AM
MAY 3 EMPLOYEE BBQ
MAY 13 CITY COUNCIL MEETING, COUNCIL CHAMBERS, 4PM
MAY 15-18 CHOWCHILLA FAIR
MAY 17 SPRING FESTIVAL PARADE
MAY 21 PLANNING COMMISSION MEETING, COUNCIL CHAMBERS, 5PM
ADJOURNMENT
I, Joann McClendon, CMC, City Clerk, do hereby declare under penalty of perjury that the foregoing agenda was posted at Chowchilla City Hall, 130 S 2nd Street, Chowchilla, CA, and made available for public review on this 17th day of April 2025 at or before 5:00 pm.
Joann McClendon, CMC, City Clerk
April 22, 2025 City Council Meeting – 3pm Closed Session | 4pm Open Session
ZOOM LOGIN INSTRUCTIONS
Use the following URL to start Zoom:
https://us06web.zoom.us/j/82377461424?pwd=UawIi6bQcZU9pOI2Lckjb8NNWpZOT9. 1 Passcode: 046 053
To participate by phone:
Dial 1-669-444-9171
Webinar ID: 823 7746 1424
Passcode: 046 053
Staff highly recommends that participants log into Zoom 15 minutes before the meeting begins to perform an audio check and ensure they have an optimal internet connection.
Options to participate / view / listen to the meeting:
• If you wish to speak on an item using the Zoom platform on your computer/laptop or smartphone, please use the “raise hand” icon, and you will be unmuted when it is your turn to speak. Please provide your name when unmuted. You can address the Council for up to 3 minutes. • If you are calling into the meeting only (no camera/video) and wish to comment, press *9 to “raise your hand” and *6 to unmute yourself.
Item 3.1
CLICK HERE
TO RETURN TO
THE AGENDA
MINUTES
Special City Council Goal Setting Workshop
City Council Chamber
Chowchilla City Hall - 130 S. Second Street, Chowchilla, CA 93610 Tuesday, April 8, 2025 – 2:00 p.m.
CALL TO ORDER/ROLL CALL
Mayor: Kelly Smith
Mayor Pro Tem: Jeff Troost (absent)
Council Members: Waseem Ahmed, Ray Barragan, John Chavez City staff and contract employees present: City Administrator Pruett, City Attorney Mary Lerner, Police Chief Jeff Palmer, Fire Chief Fred Gaumnitz, Public Works Director Jason Rogers, Community & Economic Development Director Jaime Quintana, Deputy Director of Recreation & Community Engagement Stacy Wisener, IT System Administrator Carlos Berrocal, IT System Administrator Kurt Wlodarczyk, City Clerk Joann McClendon OPEN SESSION – 2:02 PM
PLEDGE OF ALLEGIANCE and INVOCATION was deferred to the Regular City Council Meeting agenda that begins at 3pm.
GOAL SETTING WORKSHOP - Section 1
1.1 Discussion Regarding Fiscal Year 2025/2026 Goals and Priorities to Incorporate into the Budget (Pruett)
Department Heads expressed their goals for 2025/2026 fiscal year budget including the funding needed to achieve them.
Monica Ramirez, Madera County First Five, addressed the council regarding their collaboration with Dolly Parton’s Imagination Library.
ADJOURNMENT
Mayor Smith Adjurned the Special City Council Goal Setting Workshop at 3:05 p.m.
ATTEST: APPROVED:
Joann McClendon, CMC, City Clerk Mayor Kelly Smith
Item 3.2
CLICK HERE
TO RETURN TO
THE AGENDA
MINUTES
City Council Meeting Council Chamber, Chowchilla City Hall 130 S. 2nd Street, Chowchilla, CA 93610
Tuesday, April 8, 2025
Closed Session: 3:00 p.m. | Open Session: 4:00 p.m.
CALL TO ORDER/ROLL CALL 3:12 p.m.
Mayor: Kelly Smith
Mayor Pro Tem: Jeff Troost
Council Members: Waseem Ahmed, Ray Barragan, John Chavez City staff and contract employees present: City Administrator Pruett, City Attorney Mary Lerner, Police Chief Jeff Palmer, Fire Chief Fred Gaumnitz, Public Works Director Jason Rogers, Community & Economic Development Director Jaime Quintana, Deputy Director of Recreation & Community Engagement Stacy Wisener, IT System Administrator Carlos Berrocal, City Clerk Joann McClendon
CONSIDERATION OF APPROVAL OF AGENDA
Additions and/or Deletions: None.
PUBLIC ADDRESS – CLOSED SESSION
None.
CLOSED SESSION – 3:14 PM
1. CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATION Significant Exposure to litigation pursuant to Government Code Section 54956.9 (d) (2) or (3) Number of Cases: One case. See the attached correspondence with reference to litigation on page 4.
2. CONFERENCE WITH LABOR NEGOTIATORS
Pursuant to Government Code Section 54957.6
Agency Designated Representatives: City Administrator Rod Pruett Employee Organizations: City Office Employees Association, Chowchilla Police Officer Association, City Employees Association, Mid Management/Confidential Association, and Unrepresented Employees
OPEN SESSION – 4:15 PM
CLOSED SESSION REPORT: no reportable action.
PLEDGE OF ALLEGIANCE
INVOCATION: Pastor Pruitt
PRESENTATIONS/WORKSHOP - Section 1
1.1 Proclamation: Sexual Assault Awareness Month
City Council Meeting MINUTES April 8, 2025
1.2 Oaths of Office: Volunteer Firefighters Alexander Denny, Waleed Escheik, Isaac Garcia
PUBLIC ADDRESS
Andrea Shepperd addressed the City Council, thanking Council for Measure N, noting its effectiveness.
Rhonda Cargill addressed the City Council regarding the Chowchilla Friends of the Library’s fundraiser, Chapters in Bloom Garden Tour and Luncheon.
COUNCIL AND STAFF VERBAL REPORTS – Section 2
2.1 COUNCIL VERBAL REPORTS
Legislative, Collaborative Agency, Ad Hoc
Council Member Chavez attended the Chowchilla Fair dinner.
Council Member Ahmed attended ICSC Monterey.
Council Member Barragan attended the Chowchilla Fair dinner and ICSC Monterey.
Mayor Smith attended via Zoom Stephens school award presentation for honesty.
2.2 STAFF VERBAL REPORTS
Police Chief Palmer went over departmental stats since the last council meeting. Reported on a commercial burglary in which LPR’s purchased with Measure N help track down and arrest the suspects within 12 hours. The LPR’s also helped capture a wanted person who committed crime in Madera that was hiding in Chowchilla. CSO Avalos will be recognized by CAPMC for her work with child forensics victims. Reported on fatal crash vehicle v an adult pedestrian on Trinity.
Fire Chief Gaumnitz also reported out departmental stats since last meeting and gave additional information regarding staffing.
Public Works Director Rogers reported Public Works completed and submitted Congressionally Directed Spending requests to Senators Padilla and Schiff for the Roundabouts project. Had a pre-bid meeting for the Runway Rehabilitation project. where 9 contractors attended. Bids are due at the end of the month. Next week, City staff will be working with Cornerstone Church on the spring volunteer event. The big project this year is painting the Ed Ray concession stand along with other projects. And finally, still working on FY 25/26 draft budgets to submit to Finance.
Community & Economic Development Director Quintana reaching out to local businesses to see how to best support them; issued 60 permits last week; facilitating ventures with other companies.
Deputy Director of Recreation & Community Engagement Wisener focused on Saturday’s Easter event. Summer sponsorships are coming in well from local businesses.
IT System Administrator Berrocal updated council on current projects.
City Clerk McClendon is working on 25/26 budget for City Clerk and Transit departments.
City Council Meeting MINUTES April 8, 2025
City Administrator Pruett attended ICSC Monterey, obtained a few good leads and follow-ups from last conference; Community Task Force meeting; labor negotiations; and took some personal time to travel with family to Reno for a volleyball tournament.
CONSENT CALENDAR – Section 3
3.1 Approval of the March 25, 2025, Regular City Council Meeting Minutes (McClendon)
3.2 Consideration and Acceptance of the March 2025 Check Register Report (Williams)
3.3 Consideration and Adoption of a City Council Resolution (20-25) Accepting Improvements and Authorizing Filing of the Notice of Completion for the Urban Runoff Management Project (Rogers)
3.4 Consideration and Approval of a Memorandum of Understanding of the Chowchilla Police Officers Association for the Period Covering July 1, 2025 Through June 30, 2028 (Pruett)
Motion by Council Member Barragan, Seconded by Council Member Chavez to Approve the Consent Calendar as Presented. Motion passed unanimously with Mayor Pro Tem Troost absent.
PUBLIC HEARINGS – Section 4
4.1 Introduction and First Reading of an Ordinance Amending Chowchilla Municipal Code Section 2.04.110 – Council Salaries to Increase City Council Member Salaries to the Maximum Allowable Amount (Lerner)
Mayor Smith opened the public hearing at 4:43 p.m. No one came forward for or against the item.
Mayor Smith closed the public hearing at 4:44 p.m.
Motion by Council Member Chavez, Seconded by Council Member Barragan to Approve the introduction and waive the first reading of an ordinance amending chowchilla municipal code section 2.04.110 – Council Salaries to increase city council member salaries to the maximum allowable amount. Motion passed with Mayor Pro Tem Troost absent.
DEFERRED BUSINESS – Section 5
NEW BUSINESS – Section 6
6.1 Consideration and Adoption of a City Council Resolution (23-25) Approving Reimbursement Agreements, Designating Consultants, and Authorizing and Directing Certain Actions Related to the Proposed Formation of a Community Facilities District (Pruett)
Motion by council member Barragan, Seconded by Council Member Ahmed to Approve City Council Resolution # 23-25, Approving Reimbursement Agreements, Designating Consultants, and Authorizing and Directing Certain Actions Related to the Proposed Formation of a Community Facilities District. Motion passed with Mayor Pro Tem Troost absent.
6.2 Consideration and Adoption of a City Council Resolution (24-25) Accepting General Plan Annual Progress Report and Annual Housing Element Progress Report for the 2024 Year (Perea)
City Council Meeting MINUTES April 8, 2025
Motion by council member Ahmed, Seconded by Council Member Barragan to Approve City Council Resolution # 24-25, Accepting General Plan Annual Progress Report and Annual Housing Element Progress Report for the 2024 Year. Motion passed with Mayor Pro Tem Troost absent.
6.3 Presentation of Solid Waste, Water, Wastewater, and Storm Drainage Utility Analysis Report and Request Direction from Council on Initiating the Proposition 218 Process (Williams)
It was the consensus of the City Council to move forward with the Proposition 218 process.
ANNOUNCEMENTS – Section 7
APR 12 EASTER EGG SCRAMBLE, ED RAY PARK, 9:30AM
APR 16 PLANNING COMMISSION MEETING, COUNCIL CHAMBERS, 5PM APR 22 CITY COUNCIL MEETING, COUNCIL CHAMBERS, 4PM
ADJOURNMENT
Mayor Smith Adjourned the April 8, 2025 Regular City Council Meeting at 5:59 p.m.
ATTEST: APPROVED:
Joann McClendon, CMC, City Clerk Mayor Kelly Smith
REPORT TO THE CITY COUNCIL
Item 3.3
CLICK HERE
TO RETURN TO
THE AGENDA
Meeting of: April 22, 2025
AGENDA SECTION: Consent
SUBJECT: Consideration and Adoption of a City Council Resolution Approving the Amended Memorandum of Understanding of the Chowchilla Police Officers Association for the Period Covering July 1, 2025 Through June 30, 2028
PREPARED BY: Mary Lerner, City Attorney
ATTACHMENTS: Memorandum of Understanding
REVIEWED BY
ADMINISTRATOR ☒ REVIEWED BYATTORNEY ☒ REVIEWED BY FINANCE ☐ RECOMMENDATION:
Staff recommends the City Council approve the Amended Police Officer Association (“POA”) Memorandum of Understanding.
BACKGROUND:
On April 8, the City Council approved a Memorandum of Understanding with the POA with an incorrect term. The Memorandum of Understanding should have reflected a three-year term from July 1, 2025 through June 30, 2028. In addition, the code enforcement job description should have been included with the MOU as Exhibit C.
ACTIONS FOLLOWING DECISION:
All parties to execute the Amended MOU.
COUNCIL RESOLUTION # XX-25
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHOWCHILLA, CALIFORNIA
APPROVING THE AMENDED MEMORANDUM OF UNDERSTANDING OF THE CHOWCHILLA
POLICE OFFICERS ASSOCIATION FOR THE PERIOD COVERING
JULY 1, 2025 THROUGH JUNE 30, 2028
WHEREAS, Section 37206 of the California Government Code requires the City Council to prescribe the time and method of paying salaries and wages of employees of the City; and WHEREAS, the City Administrator, and/or a designated representative has, following meet and confer, proposed certain wages, hours and working conditions of employees for the classified employees of the City; and
WHEREAS, On April 8, 2025 the City Council had approved a Memorandum of Understanding with the Chowchilla Police Officer’s Association with an incorrect term of April 1, 2025 through June 30, 2028; and
WHEREAS, the Code Enforcement Officer Job Description was not included in the MOU; and WHEREAS, the correct MOU has been brought back for Council approval.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chowchilla hereby finds, determines and declares the following:
1. That the correct and complete CPOA MOU, attached hereto as Exhibit A, is for the Period July 1, 2025 through June 30, 2028.
PASSED AND ADOPTED by the City Council of the City of Chowchilla this 22nd day of April, 2025 by the following vote to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
Mayor Kelly Smith
ATTEST:
Joann McClendon, CMC
City Clerk
EXHIBIT A
MEMORANDUM OF UNDERSTANDING BETWEEN
THE CITY OF CHOWCHILLA AND
THE CHOWCHILLA CITY POLICE OFFICERS' ASSOCIATION
FOR THE PERIOD:
JULY 1, 2025 THROUGH JUNE 30, 2028
TABLE OF CONTENTS
INTRODUCTION.......................................................................................................... 5 ARTICLE I – PREAMBLE........................................................................................... 5 A. GENERAL – TERM OF THE AGREEMENT........................................................ 5 B. PURPOSE ........................................................................................................... 5 C. PARTIES ............................................................................................................. 5 D. GOVERNING LAWS............................................................................................ 6 ARTICLE II – RECOGNITION................................................................................... 6 A. CHOWCHILLA CITY POLICE OFFICERS’ ASSOCIATION –
RECOGNITION............................................................................................................ 6 B. CHOWCHILLA CITY POLICE OFFICERS’ ASSOCIATION –
REPRESENTATION ................................................................................................... 6 C. ASSOCIATION AGENTS................................................................................... 7 ARTICLE III – CHECK OFF AND ORGANIZATIONAL SECURITY....................... 7 A. CHECKOFF ....................................................................................................... 7 B. DUES DEDUCTION.......................................................................................... 7 C. HOLD HARMLESS CLAUSE............................................................................ 8 ARTICLE IV – EMPLOYEE RIGHTS..................................................................... 8 A. DISCRIMINATION ............................................................................................ 8 ARTICLE V – MANAGEMENT RIGHTS................................................................... 8 A. GENERAL........................................................................................................... 8 ARTICLE VI COMPENSATION................................................................................ 9 A. PERFORMANCE EVALUATIONS/ STEP INCREASES ................................ 9 B. COST-OF-LIVING ADJUSTMENT/SALARY SCHEDULE ADJUSTMENT 10 C. PROMOTIONAL PAY INCREASE.................................................................... 10 D. RETIREMENT BENEFITS AND 457(b) PLAN................................................ 10 3 E. BILINGUAL CERTIFICATE PAY .................................................................... 10 F. OVERTIME COMPENSATION ........................................................................ 11 G. PAY PERIODS................................................................................................. 12 H. WORK WEEK ESTABLISHED ........................................................................ 12 I. SHIFT DIFFERENTIAL...................................................................................... 13 J. WATCH COMMANDER AND FIELD TRAINING OFFICER/COMMUNICATIONS TRAINING OFFICERS ASSIGNMENTS..................................................................... 13 K. ACTING CHIEF ASSIGNMENT....................................................................... 14 L. SPECIALTY ASSIGNMENTS .......................................................................... 14 M. TERM OF SPECIAL ASSIGNMENTS ............................................................ 15 N. FIELD DUTY ASSIGNMENTS: AMMUNITION/RANGE ACCESS............... 16 O. SPECIAL EVENT SECURITY SIGN-UPS...................................................... 16 P. LONGEVITY PAY............................................................................................. 16 Q. STANDBY PAY AND CALLBACKPAY .......................................................... 17 R. EDUCATION INCENTIVE PAY...................................................................... 17 ARTICLE VII – MISCELLANEOUS........................................................................... 19 A. UNIFORMS....................................................................................................... 19 B. STAFFING ........................................................................................................ 19 C. VACATIONS..................................................................................................... 20 D. SENIORITY ...................................................................................................... 21 E. SPECIAL EQUIPMENT................................................................................... 21 F. HEALTH INSURANCE BENEFITS ................................................................ 22 G. HOLIDAYS....................................................................................................... 22 H. HOLIDAY IN LIEU PAY.................................................................................... 23 I. CASH ACCRUAL OF CERTAIN PAID LEAVES OF ABSENCE................... 24 J. REST PERIODS............................................................................................... 24 K. CLEAN-UP TIME .............................................................................................. 25 L. SICK LEAVE..................................................................................................... 25 M. WAIVER ............................................................................................................ 27 N. INCORPORATION OF PERSONNEL RULES............................................... 28 O. GOVERNING LAW........................................................................................... 28 4 ARTICLE VIII - GRIEVANCE PROCEDURE ......................................................... 28 A. PURPOSE ....................................................................................................... 28 B. MATTERS SUBJECT TO GRIEVANCE PROCEDURES ............................ 28 C. INFORMAL GRIEVANCE PROCEDURE..................................................... 29 D. FORMAL GRIEVANCE PROCEDURE .............................................................. 29 E. CONDUCT OF THE GRIEVANCE PROCEDURE................................................ 30 F. NO PREJUDICE TO PERSONNEL APPEAL ...................................................... 30 ARTICLE X - ENTIRE AGREEMENT ........................................................................... 30 ATTACHMENT “A” ..................................................................................................... 32 ATTACHMENT “B” .................................................................................................... 33 ATTACHMENT “C”.................................................................................................... 34 5 INTRODUCTION
This Memorandum of Understanding ("MOU") contains the entire understanding between the City of Chowchilla (hereafter referred to as "City") and the Chowchilla City Police Officers' Association (hereafter referred to as "Association" or "CPOA").
If any term, condition, or covenant of this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions of this Agreement shall be valid and binding. This MOU incorporates and supersedes any previous MOUs and any Side Letters amending any previous MOU governing the wages, hours, terms, and conditions of employment for the employees in Association.
ARTICLE I – PREAMBLE
A. GENERAL – TERM OF THE AGREEMENT
This MOU represents the mutual agreement of the City and the Association on terms and conditions of employment and shall be in full force and effect from July 1, 2025, up to and including June 30, 2028. The provisions of this MOU shall not take effect until ratified by both the City Council and the general membership of the Association. The Association and City agree to recommend the provisions of this MOU for approval by the Association and City Council, respectively, and, if adopted, to abide by its provisions for the term hereof. In the event this MOU expires without a successor MOU in place, the parties will adhere to those terms of this MOU that do not provide for an explicit termination date upon expiration of this MOU.
B. PURPOSE
The purpose of this MOU is to promote harmonious relations between the City and its represented employees, including all members of the Association, and to establish an equitable and peaceful procedure for the resolution of differences; the establishment of wages, hours of work, and other terms and conditions of employment.
C. PARTIES
The parties hereto are as follows:
1. The City of Chowchilla, herein referred to as “City," is a general law city, duly organized and existing under the laws of the State of California.
2. The Chowchilla City Police Officers' Association, herein referred to as "Association,"is a recognized employee organization which represents, in general, the sworn municipal police officers and non- 6 sworn employees who are stationed in the Police Department, in each of those job classifications identified in Attachment A, which is attached hereto and incorporated by reference.
D. GOVERNING LAWS
This MOU is subject to the laws of the State of California, but in particular, this MOU is subject to the provisions of Chapter 10, Division 4 of Title I of the California Government Code (Section 3500 et seq., commonly known as the "Myers-Milias-Brown Act"). The parties hereto acknowledge their relationship is also subject to certain provisions of the Municipal Code of the City of Chowchilla, including but not limited to, the provisions of Chapter 2.42 of Title II (commonly known as the" Personnel Ordinance"). The parties hereto acknowledge their relationship is also subject to the policies of the City Council of the City of Chowchilla, including but not limited to, the City of Chowchilla Personnel Rules and Regulations, as currently enacted (commonly known as the "Personnel Rules"), adopted under the provisions of Ordinance No. 374-91.
ARTICLE II – RECOGNITION
A. CHOWCHILLA CITY POLICE OFFICERS’ ASSOCIATION – RECOGNITION The City acknowledges the Chowchilla City Police Officers' Association as the sole recognized employee organization representing the sworn and non-sworn municipal employees assigned to classifications included in this MOU, and whose job category are listed in Attachment A.
B. CHOWCHILLA CITY POLICE OFFICERS’ ASSOCIATION –
REPRESENTATION
As used in this MOU, the terms, “employee” and “employees” refer, individually and collectively, to those persons for whom the Association has been recognized as the representative. For the purpose of identification only, such persons are described as those persons, if any assigned to the following classification(s): Police Officer Trainee; Police Officer I / Reserve; Police Officer II / Reserve; Police Sergeant; Administrative Supervisor; Animal Control Officer; Community Service Officer/Dispatcher; Code Enforcement Officer; CSO/Dispatcher Relief; CSO/Records Supervisor; and Laborer.
The position of the “Code Enforcement Officer” has been moved to the direction of the Chowchilla Police Department. This position is funded by Public Safety Measure “N’.
The Code Enforcement Officer will be a standalone classification subject to the job description attached as Attachment C of the MOU, the changes of which were also negotiated as part of the successor MOU.
7 C. ASSOCIATION AGENTS
The City recognizes and agrees to deal with accredited representatives of the Association in all matters relating to grievances and the interpretation of this MOU. Accredited representatives of the Association are the President or the President's designee plus one (1) to three (3) other members of the Association as designated in writing by the Association. Such accredited representatives agree to deal with the City Administrator or his/her designee as the agents of the City in all matters relating to the grievances of employees who are members of the Association, or in matters of interpretation of this MOU. Properly designated CPOA representatives shall have the right to represent their employees, without loss of compensation, in dealings with the City (all meetings between the Association and City officials) that involve matters within the scope of representation, when such meetings occur during the regular working hours of each such individual CPOA representative.
ARTICLE III – CHECK OFF AND ORGANIZATIONAL SECURITY
A. CHECKOFF
The Association shall have the sole and exclusive right to have membership dues, initiation and/or service fees deducted for employees in the bargaining unit by the City. The City shall remit to the Association each pay period (bi-weekly) all sums so deducted.
B. DUES DEDUCTION
1. The City shall deduct in accordance with the Association dues and service fee schedule, a copy of which will be provided to the City, dues from the wages of all employees who are members of the Association on the date of execution of this Agreement who have submitted dues authorization forms to the City.
2. The City shall deduct dues in accordance with the dues and service fee schedule established by the Association from the wages of all employees who, after the date of execution of this Agreement, become members of the Association and submit to the City a dues authorization form.
3. When a new employee is hired whose job classification is one who would be a member of the Association, the Secretary of the Association shall contact the employee to process their Dues Authorization and 8 membership, copies of which will be supplied to the City.
4. The City shall notify the Association if any member revokes a "Dues Authorization."
C. HOLD HARMLESS CLAUSE
The Association shall indemnify and hold the City harmless from any and all claims, demands, or suits, or any other action arising from the organizational security provision contained herein.
ARTICLE IV – EMPLOYEE RIGHTS
A. DISCRIMINATION
1. The City shall not interfere with nor discriminate in any way against any employee by reason of his or her membership in the Association or activity required by this MOU.
2. The City agrees not to intimidate an employee nor attempt to restrain any employee nor in any way to limit the full and free expression of any employee's rights to participate in the Association's lawful activities.
ARTICLE V – MANAGEMENT RIGHTS
A. GENERAL
Notwithstanding any of the items agreed to herein, nothing in this MOU is intended to limit the management rights of the City, including but not limited to:
1. Direct the work of its employees in the performance of their duties;
2. Hire, promote, demote, transfer, assign, and classify employees within the City;
3. Discipline employees for proper cause in accordance with applicable personnel rules and regulations;
4. Take actions as may be necessary to carry out the mission of the agency in
emergencies;
5. Determine the methods, means, and personnel by which operations are to be carried on;
6. Determine its budget, organization, merits, necessity and level of any activity of service provided to the public;
7. The right to implement whatsoever personnel record keeping it desires to fulfill its needs and to fulfill minimum record keeping requirements 9 pursuant to relevant state and/or federal laws, including but not limited to, the Fair Labor Standards Act.
ARTICLE VI COMPENSATION
A. PERFORMANCE EVALUATIONS/ STEP INCREASES
1. The job performance of each employee will be formally evaluated by the employee's immediate supervisor or department head in accordance with the following schedule:
(a) Probationary employee: Probationary employees who
successfully complete the probationary period will be
provided with a written evaluation by the end of the
probationary period. New employees are subject to a twelve (12) month probationary period. Probationary employees who successfully complete the twelve (12) month probationary period will be provided with a written evaluation by the end of that period.
(b) Step Increases: Beginning July 1, 2025, through June 30, 2028, the step ranges for all bargaining unit classifications shall be paid as per the "full-step." 5% step increases shall be implemented annually and upon receipt of a satisfactory performance evaluation.
(c) Regular employee: Performance evaluations shall be
completed one week prior to the employee's anniversary date, but no later than sixty (60) days after the anniversary. If, after the (60) days have expired, and there are no pending
disciplinary issues, the employee will received the full merit increase. The performance evaluation will begin with the supervisor completing an evaluation, (30) days prior to the employee’s anniversary date. If the evaluation is not fully completed, the department head is to forward a memo to the City Administrator and the supervisor advising of the
incomplete status and confirming a date within thirty (30) days in which the evaluation will be completed. The evaluation process includes the preparation of the evaluation, the approval by Administrative Services, review of the employee, and the actual processing of the Personnel Action Form
("PAF" and authorization and record of any all- personnel changes). In the event an employee fails to complete the 10 self-evaluation form within the required time limit, the employee's supervisor will proceed with the evaluation
process as herein outlined.
B. COST-OF-LIVING ADJUSTMENT/SALARY SCHEDULE ADJUSTMENT The following wage adjustments shall become effective on the first day of the first payroll period following ratification of this MOU by the Association and approval by City Council.
1. July 1, 2025 to June 30, 2026 (FY 2025-2026): 0% COLA
2. July 1, 2026 to June 30, 2027 (FY 2026-2027): 0% COLA
3. July 1, 2027 to June 30, 2028 (FY 2027-2028): 0% COLA C. PROMOTIONAL PAY INCREASE
When an employee is promoted, the promoted employee will receive a minimum pay increase of a 5% above their current base salary. The employee will be placed in the first step of the new position’s pay range that provides at least this 5% increase. If multiple steps would provide at least a 5% increase, the employee shall be placed in the lowest applicable step.
D. RETIREMENT BENEFITS AND 457(b) PLAN
1. During the term of this MOU, employees shall be responsible to pay the entire employee contribution rate, as required by law.
2. 457(b) Plan: The City shall provide up to a maximum 2% match to Employee 457(b) Plan contributions. 457(b) Plans are limited by IRS Rules.
E. BILINGUAL CERTIFICATE PAY
Employees are compensated in their base salary for certification and education required for entry into the position they hold. The City recognizes the importance of continuing education and certification for all employees.
1. Subject to the allocation limits set forth herein, eligible employees in the Association who demonstrate proficiency in speaking, reading, and/or writing in Spanish as part of the regularly assigned duties may receive bilingual pay as follows:
(a) Employees who successfully complete the City-approved bilingual proficiency examination or provide certification from an approved 11 testing authority shall receive a bilingual pay differential of 2.5% of their base hourly rate. This rate may be combined with other premium or incentive pay, with each premium calculated separately based on the employee’s base hourly rate and then added together.
Bilingual pay differential shall not be compounded with other incentive or premium pay. The examination includes both written and oral components. Employees may qualify by demonstrating proficiency in either component based on their job requirements. A maximum of eight (8) positions within the CPOA shall be designated to receive bilingual pay at any given time.
(b) The City Administrator, with City Council approval, shall determine which languages qualify for bilingual pay based on demonstrated community needs and service requirements. Spanish is currently the only authorized language for bilingual certification pay. (c) To maintain eligibility for bilingual pay, employees must re-certify their language proficiency every five (5) years or as otherwise directed by the City Administrator.
F. OVERTIME COMPENSATION
(See Rule V, Section 4, Page 19, Personnel Rules)
It shall be the duty of all department heads to operate their departments with a minimum of overtime. However, in cases of emergency or when otherwise necessary, an employee of the City may be required to work overtime. Overtime work is that work performed by an employee during periods of time other than normally scheduled for his or her specific employment. Pursuant to the provisions of Personnel Rule V, Section 4, as incorporated herein by reference, work in excess of 40 hours per week, except as otherwise specified in this MOU, shall be considered overtime. All employees entitled to overtime shall be entitled to receive either regular hourly or hourly equivalent pay or equivalent time off (Compensatory Time Off), at a rate of one and one-half times pay or one and one-half times off for each hour of overtime worked. The City Administrator and/or their designee shall have the sole discretion to determine whether an employee receives monetary compensation or Compensatory Time Off (“CTO”) for overtime worked during special events, training attendance, special enforcement activities, or other assignments outside the employee’s regular duties and responsibilities. Department heads may provide recommendations regarding the appropriate form of compensation based on operational needs and budgetary considerations. Overtime shall be distributed as equally as is practical within a given classification from among those employees who are qualified and available.
12 All overtime work, to be eligible for overtime pay or equivalent time off, must be approved by an appropriate supervisor. Leave of absence without pay shall not be counted as hours worked for the purpose of determining overtime payment.
All other hours (Holiday, Sick Leave, Vacation and Paid Leave) shall count toward the calculation of hours worked for overtime purposes.
Unused Accrued CTO shall be paid out to the employee at the end of the fiscal year unless the Department Head has approved use of such time within sixty (60) days of the end of the fiscal year. In such instances, the employee shall be required to take the time off.
No employee shall accumulate more than forty (40) hours of CTO. Special assignment positions may be allowed to accrue up to eighty (80) hours of CTO.
Such positions include SWAT officers and School Resource Officers. Employees assigned to a K-9 position may accumulate up to one hundred (100) hours of CTO. Employees in specialty assignments who are permitted to accrue CTO in excess of the standard forty (40) hour cap shall, upon reassignment from such specialty position, be required to reduce their CTO balance to or below the forty (40) hour cap within twelve (12) months of the date of reassignment. Reduction in excess CTO hours may be accomplished through: (a) Scheduled use of CTO hours with supervisor approval in accordance with departmental procedures; or (b) Cash payment for excess CTO hours at the employee’s base rate of pay at the time of the cash-out. If the employee fails to reduce their CTO balance to or below forty (40) hours within the twelve (12) month period, any remaining excess hours shall automatically be paid out to the employee at their current base rate of pay. The City Administrator, under exceptional circumstances, may authorize a one-time extension not to exceed ninety (90) calendar days for compliance with this requirement upon written request form the Department Head.
During times of budget restraint, the City Administrator may authorize the accumulation of more than the forty (40) hour limit, but not more than the FLSA limits of compensatory time off.
G. PAY PERIODS
Employees of the City of Chowchilla are paid on a biweekly basis (i.e., every two weeks) on Friday for all hours worked in the two-week period that ends at 11:59 p.m. on the Saturday preceding the Friday on which paychecks are issued. If a City designated holiday falls on a Friday, employees will be paid on the proceeding Thursday.
H. WORK WEEK ESTABLISHED
The work period will be fourteen (14) consecutive days. The work period will 13 consist of eighty (80) regularly scheduled hours. Currently, the work period consists of alternating work weeks of three (3) twelve-hour days (36 hours) and three (3) twelve-hour days plus one (1) eight-hour day (44 hours). The current work period results in a schedule of three (3) days on and four (4) days off in one (1) seven-day work period, and four (4) days on and three (3) days off in the other seven-day work period. The Chief of Police may alter the work period and resulting schedule to meet budgetary or staffing needs by decreasing the work day from twelve (12) to eight (8) hours with respect to any work week, and increasing the work week from three (3) to five (5) days as necessary to achieve the required 80 regularly scheduled hours with respect to all employees or any employee. Before altering the work period, the Chief of Police shall provide written notice to the Association of the intent to do so and the work schedule that will result with respect to any affected employee or employees and shall provide to the Association the opportunity to meet and confer concerning any such alteration.
The Fair Labor Standards Act governs overtime compensation that is not directly addressed in this MOU.
I. SHIFT DIFFERENTIAL
Employees shall receive a shift differential of three percent (3%) of their base hourly rate for all hours worked between 1800 hours (6:00 p.m.) and 0600 hours (6:00 a.m.).
This differential shall be paid regardless of the employee’s regularly assigned shift. The differential applies solely to actual hours worked within the designated time period and not to the entirety of a shift that may partially overlap with these hours.
Shift differential shall be calculated by multiplying the employee’s base hourly rate by 3% to determine the additional amount to be paid per eligible hour. This additional amount shall be paid in addition to the employee’s base hourly rate. The differential may be combined with other premium or incentive pay, with each premium calculated separately based on the employee’s base hourly rate and then added together. The differential shall not be compounded with any other premium or incentive pay.
J. WATCH COMMANDER AND FIELD TRAINING OFFICER/COMMUNICATIONS
TRAINING OFFICERS ASSIGNMENTS
The management of the City reserves the right to designate which officers below the rank of Sergeant serve as Watch Commander. It also reserves the right to determine which sworn and non-sworn officers serve as Field Training and Communications Training Officers as well as the other positions listed in this section. In the event there is not a sergeant available to supervise a shift, the employee selected to act as the “Watch Commander” for that particular shift will be compensated as follows:
14 (a) 1 to 4 hours - 1/2-hour Watch Commander Pay
(b) Over 4 hours - 1-hour Watch Commander Pay
1. Field Training Officers/Communications Training Officers will not be considered a “Specialty Assignment”. While performing duties as a Field Training Officer/Communications Training Officer, the compensation will be the same as the above “Watch Commander”
(a) 1 to 4 hours - 1/2-hour FTO/CTO Pay
(b) Over 4 hours - 1-hour FTO/CTO Pay
K. ACTING CHIEF ASSIGNMENT
In the absence of the Chief or Commander, a Lieutenant shall be designated Acting Chief if needed. Should a lieutenant not be available to serve as Acting Chief, then a Sergeant shall be designated Acting Chief. The management of the City reserves the right to designate which Lieutenant/Sergeant will serve as Acting Chief of Police. Such appointments shall be made only by formal written action of either the Chief of Police or the City Administrator, or both, and shall not necessarily proceed based solely on seniority or any other single criteria.
1. Sergeants are to receive one (1) hour of “Acting Chief Pay” for each day they are assigned the duties of Acting Chief of Police, with a written policy adopted outlining specifics as approved by the Chief of Police and City Administrator.
L. SPECIALTY ASSIGNMENTS
Probationary employees shall not be eligible for assignment to any specialty positions. However, if no regular full-time officers apply for a specialty position, the Chief of Police may allow any full-time sworn officer, including probationary officers, to apply. If only one regular full-time officer applies, the Chief of Police may re-open the application period. Assignment to specialty positions shall be at the sole discretion of the Chief of Police through formal written action via the City’s Personnel Action Form.
1. A total of twelve (12) sworn/non-sworn officers may be assigned to the following positions, with no more than four (4) sworn officers assigned at any given time, to any one of the positions below. Sworn personnel assigned to the following specialty assignments shall receive additional compensation in the amount of two and one-half percent (2.5%) of base salary for each full month, or portion thereof, that the officer serves in such 15 assignment:
(a) Detective-Narcotic Enforcement Task Force
(b) Detective- Gang
(c) Campus Resource Officer
(d) K-9 Officer (In addition, the K-9 Officer will be compensated at the level of an additional eight (8) hours of straight time per pay period for care and maintenance of their canine partner.)
(e) SWAT Team Member
(f) Drone Operator
The specialty assignment pay shall commence on the first day of the assignment and shall terminate on the last day of the assignment.
Specialty assignment pay shall not be combined (“stacked”). Officers assigned to more than one specialty position shall receive only one specialty assignment pay of two and one-half percent (2.5%) of base salary. This rate may be combined with other premium or incentive pay, with each premium calculated separately based on the employee's base hourly rate and then added together. Specialty assignment pay differential shall not be compounded with other incentive or premium pay.
2. If approved by the Chief of Police, an Officer/Community Service Officer may be simultaneously assigned to multiple specialty assignments.
M. TERM OF SPECIAL ASSIGNMENTS
The terms of special assignments, the simultaneous holding of more than one specialty assignment and resulting compensation shall be as follows:
1. With respect to all assignments to Watch Commander, Field Training Officer, or other specialty assignment positions referred to in the aforementioned provisions of the MOU, the initial assignment shall be for a period of three (3) years and may be extended upon request of the assigned officer and approval of the Chief of Police. Assignment to any such position, other than as provided in Article VI, Section M.2, below, beyond the initial term and extension will require a new application, and testing if appropriate, by the assigned officer.
With the approval of the Chief of Police, an officer may be simultaneously assigned as a Field Training Officer and as either a K9 Officer or member of a special task force relating to narcotic or gang enforcement or suppression. Such simultaneously assigned officers 16 shall not receive any additional compensation for the simultaneous specialty assignment and will receive only two and one-half percent (2.5%) of base salary, for a single specialty assignment.
2. With respect to K-9 Officers, the length of the assignment shall be a period of five (5) years or up to the working life of the K-9 the officer is assigned to handle. The assignment to position of K-9 Officer can be extended by the Chief of Police if there are extenuating circumstances that prematurely end the working life of the K-9 such as on-duty death or unforeseen medical condition that renders the K-9 unfit for duty. At the successful conclusion of the first five (5) years of the assignment, the assignment to the position of K-9 Officer may be extended on request of the assigned officer through the completion of the working life of the assigned K-9 partner with the approval of the Chief of Police.
N. FIELD DUTY ASSIGNMENTS: AMMUNITION/RANGE ACCESS
Each calendar month each sworn officer and CSO assigned to field duties are to receive fifty (50) rounds of practice ammunition.
O. SPECIAL EVENT SECURITY SIGN-UPS
Officers signing up for special events are regulated by current Department Policies.
P. LONGEVITY PAY
Regular employees shall be eligible for longevity pay according to the following schedule:
1. After completing five (5) continuous years of City service, employees shall receive an additional 2.5% of base salary.
2. After completing ten (10) continuous years of City service, employees shall receive an additional 2.5% of base salary, for a total longevity pay of 5.0%.
3. After completing fifteen (15) continuous years of City service, employees shall receive an additional 2.5% of base salary, for a total longevity pay of 7.5%.
4. After completing twenty (20) continuous years of City service, employees shall receive an additional 2.5% of base salary, for a total longevity pay of 10.0%.
5. For each additional five (5) years of continuous City service beyond 17 twenty (20) years, employees shall receive an additional 2.5% of base salary (e.g., 12.5% at twenty-five years, 15.0% at thirty years, etc.).
Q. STANDBY PAY AND CALLBACKPAY
Standby: When employees in the Association are ordered by the Chief of Police or his designee to stand by for duty, outside of normal working hours, and are thereby restricted as to their movements while off-duty, they shall be compensated in the manner shown below. This provision shall include, but is not limited to, orders to stand-by for court or administrative proceedings. (a) 1 – 2 hours = ½- hour additional standby/callback pay (b) 3 – 4 hours = 1- hour additional standby/callback pay (c) 5 – 6 hours = 1.5 hours additional standby/callback pay (d) 7 – 8 hours = 2 hours additional standby/callback pay (e) 9 – 10 hours = 2.5 hours additional standby/callback pay (f) 11 – 12 hours = 3 hours of additional standby/callback pay Call Back: An employee required to report back to work, court, or for an administrative reason outside of their regular schedule will receive compensation for a minimum of three (3) hours subject to the exception set forth below.
Employees who desire to or agree to leave before the end of their regular shift are not covered by the provision. The City will not change an employee's regular schedule to avoid this minimum payment. The Chief of Police or his designee reserves the right to have employees perform other tasks as assigned during the period of time the employee is subject to stand-by pay. Exception: employees required to report back to work within one hour of their regularly scheduled shift, or called in to work within one-hour of their regularly scheduled shift shall receive overtime compensation for that time period. If the employee is called back to work at any time other than within the one hour immediately prior to or immediately after their regularly scheduled shift, employee will receive compensation for the minimum of three (3) hours as set forth above.
R. EDUCATION INCENTIVE PAY
In order to encourage eligible employees to become better equipped to perform their duties and to provide employees with an opportunity for advancement with the City, members of the Police Department shall be compensated as they complete various segments of higher education as described below. These incentives are eligible at the time of employment so long as the employee submits the incentive requirements.
As part of the MOU, Personnel Rule XIV Section 1 regarding Employee Initiated 18 Training is hereby incorporated by reference.
1. Employees shall receive an education incentive in the amount of
3.0% of their base salary when one of the following conditions exists:
(a) Possession of an Associate of Arts or Associate of Sciences degree with a minimum of 15 units in law enforcement.
(b) Possession of a minimum of 30 units in law enforcement, not including any units attributed to the POST Academy Certificate. (c) Possession of a POST Intermediate Certificate.
2. Employees shall receive an education incentive in the amount of
6.0% of their base salary when one of the following conditions exists:
(a) Possession of a Bachelor of Arts or Bachelor of Sciences degree with a minimum of 15 units of law enforcement.
(b) Possession of a POST Advanced Certificate.
3. Employees shall receive an education incentive in the amount of
9.0% of their base salary when the following condition exists:
(a) Possession of a Master’s Degree to Doctorate Degree in a related field such as police science or criminology or in another field if benefit to the Department can be demonstrated.
The Chief of Police will recommend to the City Administrator for approval when such benefit is shown.
4. All degrees must have been obtained from a school which is fully accredited through a validated regional accrediting agency, as designated by the US Department of Education or the Council for Higher Education Accreditation (CHEA). If an employee is on a previously established training schedule, it is recommended that they confer with the Chief of Police to ensure funds are budgeted appropriately.
5. Employees must complete a minimum of one year of full-time probationary/permanent service to qualify to receive educational incentive pay. Substantiation information and documentation must be submitted to the Personnel Office by the Chief of Police thirty (30) days in advance of the anticipated qualification.
19 6. Education incentive pay shall not be combined or “stacked.” Employees qualifying for multiple education incentives shall receive only the highest single incentive for which they qualify. Education incentive pay shall be calculated based on the employee's base salary and may be added to, but not compounded with, any other incentive or premium pay.
The City of Chowchilla Personnel Rules covering tuition reimbursement is considered a part of this MOU.
ARTICLE VII – MISCELLANEOUS
A. UNIFORMS
The City agrees to pay the following uniform allowances. The Association recognizes the City's right to require those sworn police officers when present for duty, be dressed in uniforms which are clean in an acceptable level of repair. The following uniform allowances shall be paid by the City:
1. Sworn Police Officers and any Community Service Officer assigned to field work (i.e., Animal Control Officer, Code Enforcement, Evidence Technician and any other CSO doing field work as designated by the Chief of Police) shall be paid at a rate of one thousand dollars and zero cents ($1,000.00) per year.
2. Dispatcher's uniform allowance shall be paid at a rate of nine hundred twenty-five dollars and zero cents ($925.00) per year.
The City of Chowchilla shall pay the uniform allowance biannually, on a separate check, in the first pay periods in January and July. When paid, this stipend shall be considered a part of compensation for the purpose of calculating the retirement benefits for CALPERS “Classic” members where permitted by CalPERS Regulations.
New hires and probationary employees shall be provided with two long sleeve shirts, two short sleeve shirts, two uniform pants, and a jacket at the time of hire.
The cost of the provided clothing will be deducted from the employee's uniform allowance at the time he/she completes probation. Once the probationary period has been completed, the employee is eligible for the full uniform allowance following the deduction as set forth in the sentence immediately preceding.
B. STAFFING
The City shall continue to work toward a goal of having fourteen (14) sworn 20 members of the Association assigned to patrol and to achieve minimum staffing levels of sworn personnel within the Department between the hours of 6:00 a.m. and 2:00 a.m. of three (3) sworn personnel, one of which should be a supervisor or sergeant, if available. While working towards this goal, the Department will maintain a minimum staffing level of two (2) sworn officers assigned to patrol between the hours of 2:00 a.m. and 6:00 a.m. Between the hours of 6:00 a.m. and 2:00 a.m. the Department will maintain a minimum staffing level of two (2) sworn officers but shall make reasonable effort to ensure three (3) sworn officers as allowed based on staffing levels.
C. VACATIONS
1. Among sworn personnel, proceeding by seniority as determined by the length of service with the Chowchilla Police Department, employees will be permitted to select vacation periods beginning as close as practical to January 1 of each year. Each employee will be allowed two working days in which to select vacation dates. No more than 80 hours (2 weeks) of continuous vacation leave can be selected by each employee. Employees scheduling less than eighty (80) hours (2 weeks) of continuous vacation during their initial selection of vacation may schedule only one (1) period of vacation, during the first round of selection of vacation time. This 80-hour (2 week) vacation allotment shall be subject to the discretion of the Chief of Police and may be necessarily limited for reasons including, but not limited to, staffing shortages and/or emergencies.
Each employee wishing to schedule additional vacation selections must wait until all employees having less seniority have had an opportunity for their initial selection. Once all employees have had an opportunity for their initial selection, the Vacation Selection Roster will be recirculated proceeding by seniority, or additional vacation selections. Only one sworn employee, in each job classification can be on vacation during a specified period of time unless approval has been given in advance by the Chief of Police. Notwithstanding the provisions of this section, a member of the CPOA may request, and the Chief of Police may, in his sole discretion, grant an initial vacation request that exceeds the 80-hour (2 consecutive weeks) indicated above.
2. Among non-sworn personnel, vacation sign up shall be according to a procedure identical to that described in paragraph I above, except that it is understood that a separate list shall be maintained for nonsworn personnel and only one non-sworn employee shall be on vacation during any one specified period of time unless vacation 21 approval is given in advance by the Chief of Police.
3. Emergency vacation leave of less than five (5) working days may be granted if the employee gives as much prior notice as is reasonably possible. Emergency vacation leave is intended to provide the employee with the opportunity to attend relative or close family friends service. This will be reviewed and approved by the Chief of Police or Designee prior to approval.
4. Employees covered by this MOU shall earn vacation credits at the following rate:
0-3 years of service = 96 hours
After completion of 3 years of
service = 120 hours
After completion of 8 years of service = 144 hours
After completion of 15 years of service = 168 hours
After completion of 20 years of service = 200 hours
After completion of 25 years of
service = 240 hours
Maximum accrual is two (2) years of earned vacation credits. Any vacation accrued beyond the maximum allowable shall be forfeited unless otherwise approved in advance by the City Administrator.
Increases in accrual rates shall become effective at the beginning of the pay period following the completion of the qualifying years of service.
D. SENIORITY
The City grants the use of seniority in the following cases:
1. Days off preference - when such days are available.
2. Layoffs or reduction in force, with consideration of merit based on current evaluation and documentation of current
performance.
E. SPECIAL EQUIPMENT
The City agrees to provide all necessary safety equipment, at no cost to the 22 sworn officer, or nonsworn officer as applicable (i.e., CSO/Animal Control), as described under California State Laws including, but not limited to, the following:
1. Side Arms
2. All necessary leather/nylon equipment
3. Ballistic Vests/Outer Vest Carrier
4. All necessary foul weather equipment.
5. The necessary and appropriate batons/expandable batons.
6. The necessary and appropriate helmets.
The City reserves the right to determine the necessary and appropriate types of equipment. It is also understood that when equipment is purchased for use it will become required for use, and failure to properly wear or use such equipment may result in disciplinary action up to an including dismissal, unless and individual officer formally requests to the Chief of Police, and such request is approved, excluding the requirements to use an item.
The City agrees to replace such special equipment as needed; but in the case of ballistic vests, no vest will be used more than five (5) years from the date such vest is first placed in service.
F. HEALTH INSURANCE BENEFITS
Any employee who by written notice to the City declines the health care benefits provided by the City and provides written proof of the election to receive health care benefits from an alternate source (spouse's employer, military, etc.), shall receive a monthly "in lieu" payment of $225.00. The "in-lieu" amounts available to employees cannot exceed the lowest cost premium amount for medical, dental, and vision respectively. The Insurance Committee referred to in this section shall meet to determine if any adjustments are required to comply with this requirement.
The City and the Association agree to utilize an Insurance Committee for review of benefit plans and formulation of recommendations regarding response to changes in those programs. Insurance Committee shall include one member designated by the Association to represent the interests of its members. The Committee process will fulfill all meet-and-confer obligations herein.
G. HOLIDAYS
The holidays to be observed in this City are as follows:
HOLIDAY DATE
New Year’s Day January 1
Martin Luther King’s Birthday Third Monday in January
23 President’s Day Third Monday in February
Memorial Day Last Monday in May
Independence Day July 4
Labor Day First Monday in September
Veteran’s Day November 11
Thanksgiving Day and the Friday following Thanksgiving
Christmas Eve December 24
Christmas Day December 25
2 Personal Holidays As elected, per MOU
Holidays which fall on Saturday shall be observed on the preceding Friday, and holidays which fall on Sunday shall be observed on the following Monday.
In the event the City is required, by law, to recognize Cesar Chavez Day as a paid holiday, the number of Personal Holidays allowed shall revert to one (1).
Personal Holidays will-be scheduled according to the employee's preference, subject to the approval of his or her supervisor or the appropriate department head. Personal holidays not used in any fiscal year are forfeited and may not be accrued.
H. HOLIDAY IN LIEU PAY
1. Annual Compensation
Employees covered by this MOU shall receive holiday in lieu pay for the eleven (11) designated City holidays, excluding personal holidays. For employees assigned to 12- hour shifts, holiday in lieu pay shall be calculated at the rate of twelve (12) hours per designated holiday, for a total of one hundred thirty-two (132) hours of compensation annually.
2. Payment Schedule
a. By June 15th of each year, employees shall provide the department written notice of their payment preference for the following fiscal year, selecting from one of the following options:
i. Full payment of one hundred thirty-two (132) hours on November 30th;
ii. Full payment of one hundred thirty-two (132) hours on June 30th; or
iii. Split payment, with sixty-six (66) hours paid on November 30th and sixty-six (66) hours paid on June 30th.
b. If an employee fails to submit their payment preference by June 15th, the default option shall be split payment as described above. c. Once payment preference has been selected, it may not be 24 changed except in cases of unforeseen personal circumstances, which must be approved by the Chief of Police.
3. Annual Limitation
Holiday in lieu pay shall be paid annually and is not accrued beyond the fiscal year in which it is earned. Holiday in lieu pay shall have no cash value beyond the scheduled payment dates within the fiscal year.
4. Proration for Partial Year Service
a. If an employee terminates employment with the City prior to June 30, any pro-rata holiday in lieu pay already received in excess of the earned amount (calculated at 11 hours per month of service) will be deducted from the employee's final paycheck.
b. If an employee terminates employment prior to June 30 and has earned holiday in lieu pay that has not yet been paid (calculated at 11 hours per month of service), the earned amount will be included in the employee's final paycheck.
c. Employees hired during the fiscal year shall receive holiday in lieu pay prorated based on their date of hire (11 hours per month of service for the remainder of the fiscal year).
5. Working on Holidays
Employees who work on an actual holiday or observed holiday (in the case of holidays falling on weekends) shall be compensated in accordance with the overtime provisions of this MOU, in addition to receiving their regular holiday in lieu pay. For purposes of overtime calculation, the entire 12-hour shift shall be considered holiday time when the majority of the shift falls on the designated or observed holiday.
6. Shift Schedule Changes
Employees who transfer between different shift schedules (e.g., from 12-hour to 8-hour shifts or vice versa) during the fiscal year shall have their holiday in lieu compensation prorated according to their respective shift length during the relevant portion of the fiscal year.
I. CASH ACCRUAL OF CERTAIN PAID LEAVES OF ABSENCE
Vacation leave, sick leave, and holiday-in-lieu leave benefits as provided under the terms of this MOU shall be accrued by employees at the rate of pay commensurate with the base salary each employee is receiving at the time said leave is accrued.
When receiving payment for the above mentioned accrued leaves of absence, employees shall receive pay up to the accrued dollar value of the employee's accrued leaves of absence at the time of separation or the request. Holiday-in lieu is to be paid annually and is not accrued beyond the fiscal year in which it is earned.
J. REST PERIODS
25 Employees shall be allowed rest periods, coffee breaks, once before the lunch period and once after the lunch period without loss of pay. Rest periods shall be reasonably scheduled in accordance with the requirements of the department.
Rest periods will normally be provided at the rate of fifteen minutes for each four (4) hours worked. Since rest periods are paid time, nothing in this section provides for or implies any additional compensation or benefit when a rest period is not received.
K. CLEAN-UP TIME
Employees whose duties require that they get dirty shall be allowed a reasonable amount of time for personal clean-up prior to the lunch period and prior to the end of the shift, if necessary.
L. SICK LEAVE
(See Rule XJI, Section 4, Page 32, Personnel Rules)
1. Sick leave with pay shall be granted to all probationary and regular employees within the competitive service. Sick leave may be used for the following purposes:
a. Personal illness, injury, or medical condition that prevents the employee from performing their job duties;
b. Medical, dental, or vision appointments for the employee that cannot reasonably be scheduled outside of working hours; and c. Providing care for an immediate family member who is ill or injured.
For purposes of this provision, “immediate family member” shall include spouse, registered domestic partner, child (including biological, adopted, foster, step, or legal ward), parent (including biological, adoptive, step, foster, or legal guardian), sibling, grandparent, grandchild, or parent-in-law.
d. Other purposes as required by state or federal law, including the California Family Rights Act, California Paid Sick Leave Law, or other applicable legislation.
2. In order to receive compensation while absent on sick leave, the employee shall notify his or her immediate supervisor or the 26 Personnel Officer prior to, or within four (4) hours after the time set for beginning his or her daily duties, or as may be specified by the department head. In those situations which have rendered the employee incapable of reporting absence as specified above, the employee shall report at the earliest possible time. When absence is for more than five (5) working days, the employee shall be required to file a physician's certificate of personal affidavit with the department head stating the cause of his or her absence, without revealing confidential medical information.
3. For purposes of computing sick leave, a work day shall be considered one-fifth of the number of working days or duty hours in the established work week for each employee. The amount of sick leave utilized by the employee shall be based on the actual number of hours off work, even if less than a full work day.
4. Sick leave shall be earned at the rate of 3.7 hours per pay period and is also earned while on sick leave. No payment shall be made for accumulated sick leave at the time of termination of employment.
5. An employee receiving temporary disability payment under the Workers' Compensation laws may use accumulated sick leave in order to continue to maintain his or her regular income. However, all employees receiving other salaries in lieu of temporary disability payments pursuant to Section 4850 of the Labor Code are entitled to accumulate sick leave during such periods of disability.
6. When accumulated sick leave is exhausted, the employee's pay shall terminate until the employee returns to work. However, an employee with vacation credits may, upon written request to the Personnel Officer, use all or any part of his or her vacation credits as sick leave with pay only when his or her sick leave is exhausted.
The Personnel Officer may grant a leave of absence without pay for the duration of the illness.
7. Time used for sick leave is included in determining the length of an employee's continuous service with the City and his or her entitlement, if any, to any employee benefit dependent upon the employee's length of continuous service.
8. Eligible employees may convert unused sick leave to service credit for purposes of calculating retirement benefits as prescribed under the California Public Employees' Retirement Law and consistent 27 with the City's contract with the California Public Employees' Retirement System (CalPERS).
For employees hired on or before December 31, 2012 ("Classic Members" under CalPERS regulations):
a. Upon retirement, unused sick leave hours may be converted to service credit at the rate established by CalPERS; and b. This conversion shall apply to all accumulated, unused sick leave hours available at the time of retirement, including hours exceeding the 2,000-hour cap referenced in
Government Code Section 20965.
For employees hired on or after January 1, 2013 ("New Members" under PEPRA):
a. Upon retirement, unused sick leave hours may be converted to service credit in accordance with CalPERS regulations and other applicable PEPRA provisions; and
b. Such conversion shall not be used to enhance pension benefits beyond the limitations established under PEPRA, including pensionable compensation caps.
The conversion of unused sick leave to service credit shall not result in a cash payment to the employee, nor shall it be considered compensation for purposes of calculating final compensation.
Employees who separate from City service for reasons other than retirement shall not be eligible for the conversion of unused sick leave to service credit.
The City shall report all eligible unused sick leave to CalPERS upon an employee's retirement in accordance with CalPERS regulations and procedures in effect at the time of retirement.
9. Time used for sick leave is included in determining the length of an employee's continuous service with the City and the employee's entitlement, if any, to any employee benefit which is dependent upon the employee's length of continuous service.
M. WAIVER
28 Waiver by any party hereto, including any member of the Association, of any term, condition or covenant of this MOU shall not constitute the waiver of any other term, condition or covenant hereof.
N. INCORPORATION OF PERSONNEL RULES
The City Administrator and City Council agree to follow present personnel rules as written. It is understood that the MOU shall supersede the personnel rules when they are in conflict. The interpretation and application of the provisions of this MOU are grievable matters in accordance with City of Chowchilla Personnel Policies and Procedures.
O. GOVERNING LAW
This MOU shall be interpreted and construed according to the laws of the State of California. Both parties recognize the Public Employees Relations Board ("PERB") as the governing authority in the event of litigation between the parties regarding interpretation of this MOU.
Should litigation be pursued by either party beyond the PERB authority, venue in state trial court shall lie exclusively in the County of Madera. In the event of litigation in a U.S. District Court, exclusive venue shall lie in the Eastern District of California in Fresno, California.
ARTICLE VIII - GRIEVANCE PROCEDURE
A. PURPOSE
1. To promote improved employer-employee relations by establishing grievance procedures on all matters whether or not appeal or hearing is provided by other regulations.
2. To afford employees, individually or through qualified employee organizations, a systematic means of obtaining further consideration of problems after every reasonable effort has failed to resolve them through discussion.
3. To provide that grievances shall be conducted as informally as possible to the point of origin.
B. MATTERS SUBJECT TO GRIEVANCE PROCEDURES
An employee, a group of employees, or the Association shall have 29 the right to a conference under this rule, on any matter involving the interpretation, application, or enforcement of the express terms of the MOU, departmental and/or City rules and regulations.
C. INFORMAL GRIEVANCE PROCEDURE
Any employee who has a problem or complaint should first try to get it settled through discussion with his or her immediate superior without undue delay. It is strongly recommended, but not required, that grievances be documented in writing along with any responses at the informal level. Informal discussions shall be initiated within twenty-one (21) calendar days from the date of the incident. If after this discussion, the employee does not believe the problem has been satisfactorily resolved, the employee shall have the right to discuss it with their department head. Every effort should be made to find an acceptable solution by informal means at the lowest possible level of supervision. If the employee is not in agreement with the decision reached by discussion, the employee shall have the right to file a formal grievance in writing within ten (10) calendar days after receiving the informal decision of the immediate supervisor.
D. FORMAL GRIEVANCE PROCEDURE
1. Department Review: The department head will discuss the grievance with the employee's representative, if any. The department head shall render a decision and comments in writing and return them to the employee within fifteen (15) calendar days after receiving the grievance. If the employee does not agree with the decision reached, or if no decision is rendered within fifteen (15) calendar days, the employee may present the grievance in writing to the City Administrator. Failure of the employee to take further action within fifteen (15) calendar days after receipt of the written decision of the department head will constitute a dropping of the grievance.
2. City Administrator Review: The City Administrator receiving the grievance or a designated representative shall discuss the grievance with the employee and the employee's representative within thirty (30) calendar days upon receiving the grievance. If the City Administrator fails to render a decision to the satisfaction of the aggrieved party within thirty (30) calendar days, a fact-finding committee may be appointed.
The committee shall be comprised of a designated representative of the City, a representative appointed by the aggrieved party, and a third member appointed by mutual agreement of the other two. The factfinding committee shall render a recommendation on the grievance to the aggrieved party and the City Administrator within twenty (20) 30 calendar days after reviewing the grievance. The City Administrator shall take the fact-finding committee recommendation under consideration in making a final determination. .
E. CONDUCT OF THE GRIEVANCE PROCEDURE
1. The time limits specified above may be extended to a definite date by mutual agreement of the employee and reviewer concerned.
2. The employee may request the assistance of another person of his/her choosing in the preparing and presenting of an appeal at any level of review.
3. The employee and the representative will be allotted up to three (3) hours of on duty time to confer about and present and appeal.
4. Employees shall be assured freedom from reprisal for using the grievance procedure.
F. NO PREJUDICE TO PERSONNEL APPEAL
Any action taken by employee pursuant to this rule shall in no way jeopardize the right of employee to authorized hearing before the Personnel Board, if such hearing and review is otherwise authorized.
ARTICLE X - ENTIRE AGREEMENT
Except as is expressly set forth herein, this MOU contains the entire understanding between the City and the Association. Any prior agreements, promises, negotiations, or representations not expressly set forth herein are of no force or effect.
During the life of this MOU should either party desire to modify its terms or to meet and confer as to matters within the scope of representation, such party shall request .in writing to meet and confer on the item at issue. This shall not create a right to renegotiate this Agreement. //
//
//
//
//
31 IN WITNESSETH HEREOF, the parties execute this Agreement on the ____ day of _______________ 2025.
FOR THE ASSOCIATION: FOR THE CITY OF CHOWCHILLA:
Sgt. David Burnett, CPOA President Rod Pruett, City Administrator
Sgt. Joshua Cobb, CPOA Vice President Kelly Smith, Mayor ATTEST:
Joann McClendon, City Clerk
ATTACHMENT “A”
Chowchilla Police Officer Association Classifications
Administrative Supervisor
Animal Control Officer
Community Service Officer/Dispatcher
Code Enforcement Officer
CSO/Dispatcher Relief
CSO/Records Supervisor
Laborer
Police Officer I / Reserve
Police Officer II / Reserve
Police Officer Trainee
Police Sergeant
ATTACHMENT “ B”
Salary Scale
Agreed Upon Salary Scale to take effect July 1, 2025 – June 30,2028 Sworn Staff
Non-Sworn Staff
CLASSIFICATION Grade A A1/2 B B1/2 C C1/2 D D1/2 E E1/2 F Police Officer Trainee P27 $23.96 - - - - - - - - - -
Police Officer I/ Reserve P38 $30.00 - - - - - - - - - - Police Officer II/ Reserve P40 $35.05 35.92 36.81 37.73 38.67 39.63 40.62 41.63 42.67 43.73 44.82 Police Sergeant P48 $44.82 45.94 47.08 48.25 49.45 50.68 51.94 53.23 54.56 55.92 57.31 CLASSIFICATION Grade A A1/2 B B1/2 C C1/2 D D1/2 E E1/2 F CSO /Dispatcher P28 28.00 28.70 29.41 30.14 30.89 31.66 32.45 33.26 34.09 34.94 35.81 CSO / Dispatcher Relief P15 28.00 28.70 29.41 30.14 30.89 31.66 32.45 33.26 34.09 34.94 35.81 Code Enforcement Ofc 36 28.00 28.70 29.41 30.14 30.89 31.66 32.45 33.26 34.09 34.94 35.81 CSO/Records Supervisor P33 30.71 31.50 32.31 33.14 33.99 34.87 35.77 36.69 37.64 38.61 39.61 Administrative Supervisor P40 34.12 35.00 35.90 36.83 37.78 38.75 39.75 40.77 41.82 42.90 44.00 Animal Control Officer P26 23.79 24.38 24.98 25.60 26.24 26.89 27.56 28.24 28.94 29.66 30.40 CLASSIFICATION Grade A A1/2 B B1/2 C C1/2 D D1/2 E E1/2 F Laborer P5 17.03 17.46 17.90 18.35 18.81 19.28 19.76 20.25 20.76 21.28 21.81 ATTACHMENT “C”
Code Enforcement Officer Job Description
CITY OF CHOWCHILLA
Job Description
Dept: Public Safety Date: April 17, 2025
Title: Code Enforcement Officer Supersedes: N/A
Job #: 400 Total Pages: 4
SALARY RANGE: 36 ASSOCIATION: CCPOA
A. PURPOSE:
Under general direction, to receive and document complaints regarding health, safety, parking, building and/or municipal code violations; investigate complaints, determine validity of complaints, and take appropriate action; assist in the preparation of court cases in municipal code violations which cannot be handled through administrative means; perform dispatch duties including receiving and prioritizing calls for service; provide non-emergency police services; and perform related duties as required.
B. DISTINGUISHING CHARACTERISTICS:
The Code Enforcement Officer is the journey level class responsible for performing the full scope of assigned duties. Incumbents are skilled in making inspections and enforcing codes and regulations in a broad range of buildings and related codes and performing dispatch and community service functions.
The work requires independence and discretion in working with the pubic, conducting field inspections, and handling dispatch communications.
C. ESSENTIAL FUNCTIONS:
1. Receives and documents complaints from citizens regarding safety, health, building, business license and other city ordinance violations.
2. Maintain the ability to perform all dispatch duties and assist when such situations occur where dispatching is needed.
3. Receives and prioritizes emergency and non-emergency calls; dispatches appropriate personnel and equipment.
4. Monitors radio traffic and maintains communications with field units.
5. Performs data entry and retrieval functions using specialized law enforcement computer systems.
6. Conducts field investigations to determine if violations have occurred.
7. Determines responsible party; writes letters, sends courtesy notices, or talks to the individuals who have violated the laws or ordinances.
8. Assists violators with understanding the laws and codes, and explains what must be done to remedy a violation.
9. Checks to see that violations have been corrected.
10. If violations are not corrected and violators are uncooperative, issues citation or turns matter over to the appropriate law enforcement agency.
11. Assists with preparation of court cases.
12. Serves as expert witness and provides testimony in court.
13. Assists management with the writing of new ordinances.
14. Develops, maintains, and files records and evidence relative to complaints, courtesy notices, citations, etc.
15. Researches records to determine if property owner coordinates with other City departments and outside agencies in the resolution of complaints.
16. Assists other departments with the handling of hazardous material complaints.
17. Assists with the development and implementation of programs to support compliance and enforcement.
18. Maintains a database file on complaints and a time schedule for their resolution.
19. Presents information to citizen groups, businesses, and homeowners on crime prevention programs.
20. Conducts home and business security checks to identify security problems.
21. Recommends security devices and other protective measures.
22. May direct and control crowds and traffic at accident scenes or special events.
23. Handles animal regulation duties when needed.
24. Participates in Graffiti Abatement Program.
D. ESSENTIAL RESPONSIBILITIES:
To perform this job successfully, an individual must be able to perform each essential duty satisfactorily. The requirements listed below are representative of the knowledge, skill, and/or ability required. Reasonable accommodations may be made to enable individuals with disabilities to perform the essential functions.
1. General and Specialized Job Knowledge and Abilities:
a) General Knowledge of: English, general math.
b) Specialized Knowledge of: Safety, hazardous materials methods of collecting, safeguarding of evidence, and laws pertaining to building codes and regulations; criminal and court proceedings; search and seizure; penal, civil, and municipal codes; zoning ordinances; computer applications and manipulation of data bases; radio protocols and dispatch procedures; emergency response protocols; and record-keeping systems.
c) Ability to: Read, understand and interpret laws, City ordinances, rules and regulations; explain laws, ordinances, rules and regulations to property owners and the general public; work out methods to abate violations; counsel property owners on ways to come into compliance; give out tickets and violation notices; make effective written and oral presentations; collect and maintain evidence in a proper manner; draft new ordinances; make recommendations on changes to ordinances; work with the public in contentious situations without making the public angry; develop and maintain files on permits, violations, and such; write letters and reports; coordinate with many City departments and other governmental agencies; operate radio communication equipment; multi-task in high-pressure situations; type at least 35 WMP.
2. Resources, Including Money, Equipment, Materials, and Records:
Records, files, radio, tape recorder, small hand tools, collects evidence relative to code violations; actions which subject the City to liability; building permit money, vehicles; operate modern office equipment including computer equipment and software programs; camera and operate a motor vehicle safely; dispatch console and emergency communications equipment.
3. Solving Problems: Jurisdictional; irate citizens and property owners; political pressure for action/non-action; development of adequate evidence; determining when to move from complaint, to citation, to a court case.
4. Performance of Others: Clerical who assist with the input of data and maintenance of files; functional supervision of other departments agencies involved in safety and resolution of hazardous material violations.
5. Relations with:
a) Internal: City Council, City Administrator; Police, Fire, Public Works and Finance Departments; Community Development.
b) External: Federal, state and county agencies; the business community; community groups; school districts; property owners and citizens.
6. Communications:
a) Oral: Conversations, speeches, negotiations, and instructions. b) Written: Legal records, files, complaints, reports, letters and memos.
c) Visuals: Violations, safety and chemical hazards.
d) Auditory: Conversations, radio, evidential displays.
7. Safety:
a) Hazardous Conditions: Safety and hazardous material violations; self-protection and protection of others around safety problems and hazardous materials; driving in urban and freeway traffic. b) Frequency: Daily.
c) Consequence: Minor injury to serious injury and risk of serious illness.
8. Tolerance of Job Conditions: The work environment characteristics described here are representative of those an employee encounters while performing the essential functions of this job. Reasonable accommodations may be made to enable individuals with disabilities to perform the essential functions.
Controlled environmental conditions while in the office; heat, cold, dust, rain and fog while investigating complaints, resolving violations, dealing with disputes and irate people.
9. Physical Aptitude:
a) Above average finger dexterity.
b) Ability to crawl/climb; move through openings and lift or move objects up to 50-75 lbs.
10. Application of Mental and Physical Effort: Mental effort requires a high degree of concentration for sustained periods of time; intense negotiations and confrontations. Physical effort requires light to moderate and occasional heavy physical effort.
E. PREREQUISITIES:
1. Education and Experience: Any combination of education and experience that has provided the knowledge, skills and abilities necessary for a Code Enforcement Officer. A typical way of obtaining the required qualifications is to possess three years of experience working with the public in the interpretation and application of laws, codes, rules and procedures. High school diploma or equivalent required; college credits in criminal justice or communications preferred. Possession of a valid P.C. 832 certificate, or the ability to obtain within one (1) year of employment.
2. Licenses, Registrations, Accreditation, etc.: Possession of a valid Class C California Motor Vehicle Operators License; a 35 WPM Typing Certification; and achieve within one year of appointment the completion of a P.O.S.T. Dispatch Certificate, completion of D.O.J. training for full access operator, and standard CPR and First Aid Certificates issued by the American Red Cross.
Date: City Administrator:
Date: Dept. Head:
Date: Employee:
REPORT TO THE CITY COUNCIL
Item 3.4
CLICK HERE
TO RETURN TO
THE AGENDA
Meeting of: April 22, 2025
AGENDA SECTION: Consent
SUBJECT: Second Reading and Adoption of an Ordinance Amending Section 2.04.110 of the Chowchilla Municipal Code to Increase City Council Member Salaries to the Maximum Allowable Amount
PREPARED BY: City Attorney
ATTACHMENTS: Proposed Ordinance
REVIEWED BY
ADMINISTRATOR ☒ REVIEWED BYATTORNEY ☒ REVIEWED BY FINANCE ☐ RECOMMENDATION:
That City Council adopt the proposed Ordinance and its findings and set the Ordinance for adoption at the next regular meeting.
BACKGROUND:
The current salary for City Councilmembers is three hundred dollars ($300) per month. This amount has remained unchanged for many years and is significantly below the maximum amount authorized by state law for cities with populations under thirty-five thousand (35,000).
California Government Code section 36516 establishes the statutory framework for City Council compensation. For cities with populations up to thirty-five thousand (35,000), which includes the City of Chowchilla with its population under twenty thousand (20,000), state law authorizes City Councilmember salaries up to nine hundred fifty dollars ($950) per month.
The City Council has expressed its desire to increase City Council compensation to this maximum allowable amount. Since Chowchilla is a general law city, the increase for council members would go into effect following the next regular election in November 2026. However, directly elected Mayors (such as Chowchilla’s) and Charter City councils are eligible to have increases go into effect during current terms.
This item was introduced to the City Council under Public Hearing on April 8, 2025.
FISCAL IMPACT:
The proposed increase represents an additional annual cost of $39,000 from the General Fund. 1 ORDINANCE # 525-25
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CHOWCHILLA AMENDING SECTION 2.04.110 OF THE CHOWCHILLA MUNICIPAL CODE
WHEREAS, the current salary for City of Chowchilla (“City”) Councilmembers is three hundred dollars ($300) per month; and
WHEREAS, California Government Code section 36516 (a)(2)(A) authorizes cities with a population up to and including thirty-five thousand (35,000) people to establish City Councilmember salaries up to nine hundred fifty dollars ($950) per month; and WHEREAS, the City has a population of less than twenty thousand (20,000), placing it within this population category; and
WHEREAS, the current compensation of three hundred dollars ($300) per month is substantially below the maximum amount permitted by state law and has not been adjusted for many years; and
WHEREAS, the City Council desires to increase City Councilmember compensation to the maximum allowable amount; and
WHEREAS, the City Council finds that this increase is necessary and appropriate to ensure fair compensation for the services provided by the City Councilmembers to the community.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CHOWCHILLA DOES ORDAIN AS FOLLOWS:
SECTION 1. Section 2.04.110 (“Council salaries–Established”) of Chapter 2.04 (“City Council”) of Title 2 (“Administration and Personnel”) of the City Municipal Code is hereby amended to read as follows:
“2.04.110 - Council salaries—Established.
Each member of the city council shall receive a salary in the amount of nine hundred and fifty dollars per month as prescribed in section 36516 of the California Government Code for cities up to and including thirty-five thousand (35,000) in population. Following any amendments to the Government Code that permits an increase or requires a decrease in the salary to councilmembers, this section shall be amended to reflect the maximum amount of compensation permitted under the California law. Provided, however, that the salary as so increased shall become effective as to all members only on and after the date upon which one or more members of the council become eligible therefor by virtue of beginning a new term of office following the next succeeding general municipal election held in the city.
SECTION 2. SEVERABILITY. If any part of this Ordinance is held invalid for any reason by a court of competent jurisdiction, such decision shall not affect the validity of the remaining portion of this Ordinance, and the City Council hereby declares that it would have passed the remainder of the Ordinance if such invalid portion thereof had been deleted. 2 SECTION 3. EFFECTIVE DATE. This Ordinance shall take effect and be in force thirty (30) days from and after its final passage.
SECTION 4. PUBLICATION. The City Clerk is hereby directed to post a summary and certified copy of this Ordinance in the City Clerk’s office at least five (5) days prior to adoption and to publish a summary of the Ordinance in the Madera Tribune, a newspaper of general circulation, within fifteen (15) days after its adoption.
INTRODUCED at a regular City Council meeting on the 8th day of April 2025.
PASSED AND ADOPTED by the City Council of the City of Chowchilla this 22nd day of April, 2025 by the following vote to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
Mayor Kelly Smith
ATTEST:
Joann McClendon, CMC
City Clerk
REPORT TO THE CITY COUNCIL
Item 3.5
CLICK HERE
TO RETURN TO
THE AGENDA
Meeting of: April 22, 2025
AGENDA SECTION: Consent
SUBJECT: Informational Item – Excel Project Management Program (PMP) Update PREPARED BY: Vanessa Galvez-Escobar, Deputy City Clerk
APPROVED BY: Joann McClendon, City Clerk
ATTACHMENTS: Excel Project Management Program City Council Departmental Spreadsheets
REVIEWED BY
ADMINISTRATOR ☒ REVIEWED BYATTORNEY ☒ REVIEWED BY FINANCE ☐ RECOMMENDATION:
Informational item only.
BACKGROUND:
City Council has requested that staff bring back the Project Management Program (PMP) reports on a quarterly basis for follow up and review. Below you will find a quick review of items that are on-going, in progress, or on hold. The last report was brought to the Council on January 28, 2025.
City Staff emailed each department their project list to update for the dates between January through March 2025.
Smart Sheets
Project / Description Date Update Motion/Approvals Info Source Status Notes Public Finance Authority
3.3 Consideration and Adoption of a City Council Resolution (26- 23) Directing the Execution of and Authorizing the Recording of a Termination Agreement Including a Certificate of Acceptance. (Pruett)
Facilities Lease Agreement with the Chowchilla Public
Finance Authority (PFA) in 2016 to lease Ed Ray Park
Recreation Building and the Chowchilla Senior Center which was part of the 2005 Civic Center Bonds that were issued.
All the required lease payments under the term of the lease and the refunded bonds have matured. Motion by Council
Member Troost, Seconded by Pro Tem Smith to Approve the Consent Calendar as Presented. Motion passed unanimously by roll call vote. Actions Following Approval: The City Administrator will sign all the necessary documents for the Termination Agreement and Certificate of Acceptance.
Those documents will then be recorded
Consent Calendar
City Council Meeting Completed
Cares Act Funds 5/2023 6.2 Discussion and Direction Regarding the Use of American Rescue Plan Act Funds (Pruett)
Council directed staff to table the item and bring it back at a future meeting in order to obtain different scenarios. Action Following Approval: Incorporate direction given by Council into the FY 23/24 and subsequent budgets.
City Council Meeting
3.1 Discussion and direction regarding the use of American Rescue Plan Act Funds. (Rogers)
Actions following approval: Incorporate direction given by Council into the FY 23/24 and subsequent budgets. The City Council directed staff to use the remainder ARPA funds and add a new well, extend water lines (stub-outs) to Berenda Slough, and purchase a generator for Well 1A.
Completed
Human Resources
HR Manager Trinette Martinez reports to City Administrator Rod Pruett and most updates will be from the City Administrator. As the City Clerk, however, and per our municipal code, I will still manage claims against the City, accept subpoenas, and have agreed to continuing to manage insurance for City fleet and property.
Ongoing
Consideration and Adoption of a City Council Resolution Adopting the Revised Transit Services Drug and Alcohol Testing Policy (McClendon)
Completed
Consideration and Adoption of a City Council Resolution Adopting the Revised Transit Services Drug and Alcohol Testing Policy (McClendon)
Motion by Mayor Pro Tem Ahmed, Seconded by Council
Member Barragan to Approve the Consent Calendar as
Presented. Motion passed by roll call vote.
Completed
Completed
Department: Administration
Quarterly: January - March 2025
Municipal Code 12/2024
Consideration and Adoption of an Ordinance Amending Chapter
3.13 to the Chowchilla Municipal Code Reenacting and Imposing the Existing Public Safety Transactions and Use Tax to be Administered by the State Department of Tax and Fee
Administration (Lerner)
Motion by Council Member Troost, Seconded by Mayor Pro
Tem Ahmed to Approve City Council Ordinance #523-24,
Amending Chapter 3.13 to the Chowchilla Municipal Code
Reenacting and Imposing the Existing Public Safety
Transactions and Use Tax to be Administered by the State Department of Tax and Fee Administration. Motion passed by roll call vote.
Agenda Minutes Completed
The municode was
updated to reenact
Measure N
Events
1/22-24/2025 LOCC Mayor and Council Member Conference in Sacramento Completed Rod and John Attended 2/5-7/2025 City Managers Conference Completed
Smart Sheets
Project / Description Date Update Motion/Approvals Info Source Status Notes ADHOC: Wastewater
Treatment Plant On Hold
ADHOC: Park Fields In Progress
Fairmead WWTP Project
(2016)
New Business: 6.2 Financial Assistance / Water & Sewer Fairmead.
Reviewing draft Urban Water Management Plan information, Plan completed and sent to the State for review and approval. JCI will complete engineering study to evaluate the ability of the City's current services to provide similar services to the Fairmead Community. Grant funded.
8/15/2017 S/W Jason Roger - waiting
on Madera County to Make decision /
srw - JCI to complete engineering
study. 4/30/2018 - Waiting on Funding
Agreement from the State.
Worked on information requests from the SWRCB for the Project technical review.
Wkly Activity Report
12/10/2023
4/2024
State Water Resources Control Board anticipates funding agreement by August 2024. High Speed Rail anticipates reimbursement agreement prior to State's.
Measure T Renewal 4/2024
Steering Committee had its last meeting on 4/23; appears they are okay with continuing use of population as the basis for allocation; also proposing 80% to local street maintenance which is an increase from current 30%; will be presented to the MCTC board and then to the Mad Co BOS for approval to place on ballot.
7/2024
The Steering Committee was able to modify the initiative and obtain enough signatures to place on ballot; essentially it is the same plan, what has changed is it only requires a majority versus a 2/3 approval to pass.
Opposition groups are trying to sue this change.
9-10 2024
City Council Meeting 10/10/24: Approval of 24/25 Measure T Expenditure Plan - Part of the requirement to provide the information to the public on what we plan to spend the funds on for FY 24/25: Public Hearing
Reported by Admin
Department: Public Works
10/24
Consideration and Adoption of a City Council Resolution (55-24) Approving the Measure T Annual Expenditure Plan (AEP) for Fiscal Year (FY) 2024/25 and Authorizing the Public Works Director or Designee to Submit the Plan to the Madera County Transportation Authority (MCTA) for Adoption (Rogers)
Motion by Mayor Pro Tem Ahmed,
Seconded by Council Member Troost to
Approve City Council Resolution #55-
24, Approving the Measure T Annual
Expenditure Plan (AEP) for Fiscal Year
(FY) 2024/25 and Authorizing the
Public Works Director or Designee to
Submit the Plan to the Madera County
Transportation Authority (MCTA) for
Adoption. Motion passed by roll call
vote.
Public Hearing
10/2024
Consideration and Adoption of a City Council Resolution (56-24) to Extend the Annual Public Review Period for Expenditures Related to Measure T to 30 Days (Rogers)
Motion by Council Member Troost,
Seconded by Mayor Pro Tem Ahmed to
Approve City Council Resolution #56-
24, to Extend the Annual Public Review
Period for Expenditures Related to
Measure T to 30 Days. Motion passed
by roll call vote.
Council Meeting Completed
Well 15
Zims Industries has been drilling well 15 all week. They are still on site working. Met with Zims to inform them that their temporary backflow assembly is leaking. Zims repaired.
Wkly Activity Report
10/21/23
10/2023 Zims Industries has been drilling well 15 all week. Wkly Activity Report 10/8/23
10/2023
Zims Industries has been drilling all week. They are still on site working.
Water quality sampling was completed and will need to wait on the lab for results and then get the approved design from the engineer. Lab results can take anywhere from one to six weeks.Zim will then start the reaming of the borehole soon after receiving the approved final design.
Wkly Activity Report
10/15/23
12/2023
Zims is installing case and shaft. Spoke to the rig operator and he said that they will need to flush the well for 60 hours (flow ranging from 250 - 1250 GPM) the following week.
Wkly Activity Report
12/24/23
11/2024
Consideration and Adoption of a City Council Resolution Awarding a Contract to VM Lyles Company for Civic Center and Well 15 Generator Improvements Project in the amount of $1,190,560.00 and Authorizing the City Administrator or Designee to Execute All Related Documents Thereto and Amending the Fiscal Year 2024/25 City Budget (Rogers) Well 16 12/24
Consideration and Adoption of a City Council Resolution Awarding the Contract for Well No. 16 Improvements to Alliance Construction Solutions, Inc. in the Amount of $924,300, Authorizing the City 1/2025 Drilling ongoing. Weekly Report
Bridge Preventative
Maintenance Project 11/2024
Consideration and Adoption of a City Council Resolution Awarding a Contract to Cornerstone Structural Engineering Group, Inc. for the Bridge Preventative Maintenance Project in the amount of $37,300.00 and Authorizing the City Administrator or Designee to Execute All Related Documents Thereto (Rogers)
Motion by Council Member Troost,
Seconded by Mayor Pro Tem Ahmed to
Approve City Council Resolution #61-
24, Awarding a Contract to Cornerstone
Structural Engineering Group, Inc. for
the Bridge Preventative Maintenance
Project in the amount of $37,300.00 and
Authorizing the City Administrator or
Designee to Execute All Related
Documents Thereto. Motion passed
with Council Member Barragan absent.
High Speed Rail 7/1/2024
Attended meeting with HSR to discuss reimbursement agreement for the Fairmead Sewer Consolidation Project. Provided draft agreement comments from legal to HSR. HSR to review and provide
revisions/comments.
Weekly Report
08/2024
6.2 Consideration and Adoption of a City Council Resolution (50-24) Authorizing the City to Enter into a Reimbursement Agreement with the California High Speed Rail Authority and Authorizing the City Administrator to Execute any Related Documents Thereto (Rogers) Motion by Council Member Troost,
Seconded by Council Member Chavez
to Adopt City Council Resolution #50-
24, Authorizing the City to Enter into a
Reimbursement Agreement with the
California High Speed Rail Authority
and Authorizing the City Administrator
to Execute any Related Documents
Thereto. Motion passed with Mayor
Smith absent.
On Going
2/2025
Attended Economic Development Ad Hoc meeting to discuss preferences for the Fairmead Sewer Consolidation Project (preference is for the new sewer line to go down Ave 24 to Rd 16), and High Speed Rail mitigation along SR 152
Wkly Report -
Reported by Public
Works 2/17-23/2025
Scour Countermeasure
Project 11/2024
Consideration and Adoption of a City Council Resolution Awarding a Contract to Cornerstone Structural Engineering Group, Inc. for the Road 16 Over Berenda Slough Scour Countermeasure Project in the amount of $252,200.00 and Authorizing the City Administrator or Designee to Execute All Related Documents Thereto (Rogers)
Motion by Council Member Troost,
Seconded by Council Member Chavez
to Approve City Council Resolution
#62-24, Awarding a Contract to
Cornerstone Structural Engineering
Group, Inc. for the Road 16 Over
Berenda Slough Scour Countermeasure
Project in the amount of $252,200.00
and Authorizing the City Administrator
or Designee to Execute All Related
Documents Thereto. Motion passed
with Council Member Barragan absent.
Madera County
Transportation
Commission
8/2024
Consideration and Adoption of a City Council Resolution (47-24) Approving the Master Agreement Between the Madera County Transportation Commission and the City of Chowchilla for the Fiscal Year 2023/2024 Allocation of Regional Surface Transportation Program (RSTP) Exchange Funding and Authorizing the City Administrator or Designee to Sign Necessary Claim Forms to Obtain Future Funding (Rogers)
Motion by Council Member Barragan,
Seconded by Council Member Troost to
Approve the Consent Calendar as
Presented. Motion passed by roll call
vote with Mayor Smith absent.
10/24
Consideration and Adoption of a City Council Resolution (55-24) Approving the Measure T Annual Expenditure Plan (AEP) for Fiscal Year (FY) 2024/25 and Authorizing the Public Works Director or Designee to Submit the Plan to the Madera County Transportation Authority (MCTA) for Adoption (Rogers)
Motion by Mayor Pro Tem Ahmed,
Seconded by Council Member Troost to
Approve City Council Resolution #55-
24, Approving the Measure T Annual
Expenditure Plan (AEP) for Fiscal Year
(FY) 2024/25 and Authorizing the
Public Works Director or Designee to
Submit the Plan to the Madera County
Transportation Authority (MCTA) for
Adoption. Motion passed by roll call
vote.
Fairmead Consolidation
Project 7/2024
the HSR received the Citys legal documents on the reimbursement agreement and they are working on a response. SWRCB has submitted an agreement and has asked our legal for an opinion which they are in the process of reviewing
Reported by Admin
Moving forward with QK doing the final design and getting the project ready for bid Admin
10-2024
Waiting for final internal approval process from HSR for our reimbursement agreement. This will be used for the design part of the project which happens first. Still just waiting on High Speed Rail to do the final review and approval of the reimbursement agreement and then we can start the design phase.
Weekly Activities
Report Reported by
Admin
11-2024 Had email communication with High-Speed Rail and their audit division has finalized the review of the agreement and it is ready to move forward.
Weekly Activities
Report Reported by
Admin
12/2024 Still waiting on High Speed Rail to approve the reimbursement agreement to start the design
1/2025
Received the agreement from HSR and I signed it; Now waiting for HSR to sign and send us the fully executed copy, Then we will have QK begin the design.
Weekly Activities
Report Reported by
Admin
1/2025
Followed up with HSR on the Fairmead Reimbursement Agreement. HSR stated it has passed the legal review and now needs to be approved by their Chief Administrative Officer and CEO. Once it is approved by both, it will come back to the City for signature.
Weekly Activities
Report Reported by
Admin
02/2025
We finally got the signed reimbursement agreement from HSR so we are ready to begin the design and environmental phase
We have an Ad Hoc scheduled for 2/18 to finalize the path of the sewer lines
Weekly Activities
Report Reported by
Admin
03/2025 QK is doing the design and environmental for the project Timeline to be bid ready is around 12 months
Weekly Activities
Report Reported by
Admin
04/2025 Still working on design
Weekly Activities
Report Reported by
Admin
In Progress
Robertson Blvd.
Rehabilitation and
Complete Streets/Caltrans
12/2023 • Either down Ave 24 to 16 and up to the plant or up Ave 24 to Chowchilla Blvd then up to Ave 24 ½ where there is already a connection Wkly Activity Report
12/10/23
5/2024
o The Chowchilla Blvd route could save money because it is much less distance and it will then provide water and sewer from AutoZone to Ave 24 on Chowchilla Blvd
7/2024 o The Ave 24 route to Rd 16 provides the pipe for a longer distance and could be beneficial for future development in that area On Going 3/2025 Resolution approving a new freeway agreement with Caltrans • For the Roundabout project
Weekly Activities
Report Reported by
Admin
4/2025
Attended Robertson Blvd. CAPM project with Caltrans to review the 60% design plans. City staff comments to be provided back to Caltrans next week.
Wkly Activities
Report 4/5/2025
Clean CA Grant/ Robertson
Blvd. Beautification Project
Mayor Pro Tem Ahmed inquired about follow up with Caltrans regarding fallen palm fronds. Public Works Director Rogers noted that there currently is no maintenance schedule for palm tree frond pickup and suggested entering into maintenance agreement with Caltrans, in which the City can be reimbursed for work normally tasked to Caltrans.
Public Works met with Caltrans and
had a discussion but no agreement was
made at this time.
Verbal Staff Report
West Coast Arborist Completed Work Wkly Activities
Report 7/2/23
4/2024
Bid advertisement closed on April 18, 2024. City received 1 response.
Bid is currently being reviewed for completeness and responsiveness.
City received request from Caltrans to change part of the scope of project and remove the lighted crosswalks as they are no longer compliant with Caltrans standards on state highways and will be removed in 2 years when they resurface Robertson Blvd. City has requested a meeting with Caltrans next week to discuss further and to see if additional lighting or other improvements can be added in place.
4/18/2024
7/2024
Attended pre-construction meeting with Granite Construction for the project. Estimates start date is August 19 with estimated completion by the end of October.
7/2024
Construction ongoing. Pavement completed. Striping completed and road re-opened. Waiting on pipe to be delivered for continuation of the water main stub outs.
8/2024
Robertson Boulevard Beautification Amendment was presented to and adopted by the City Council at their special meeting. this grants the City an additional $228,880 to bridge the cost gap. The project bid that was accepted came in at $1,084,880 to complete the project. Clean CA grant funded the City $856k for the project, leaving a deficit of $228,880. 10/2024
Caltrans has approved the traffic plan and we are ready to have the contractor begin work. They are supposed to start next week. Clean CA Robertson Blvd project has begun as of 10/21. They are supposed to be done in 60 days, Pedestrian safety and ADA improvements and median beautification by the railroad crossing.
Weekly Activities
Report Reported by
Admin
11/2024
At 11th St. the crosswalk was not accessible for the kids going to school but Jason met with them and they have now provided a path. We also had an issue at 5th St. with customer access to businesses and parking access.
Some intersections have been temporarily opened and pedestrian access has been improved. Cross walk at 11th is available for kids to cross.
Weekly Activities
Report Reported by
Admin
12/2024 Working on the other side of 11th street now. Concrete work completed on median but still have the landscape and arch to do.
1/2025
Apparently the crew hit an ATT line on the corner of 13th but nobody knew it because the School was not in session and they poured concrete over it. As of 1/8 it was dug up and ATT made the repairs and the phone lines are back on for Wilson.
Weekly Activities
Report Reported by
Admin
1/2025
Attended weekly progress meeting with Granite. Project moving forward.
Granite’s sub-contractor accidentally cut the phone line while trenching.
Looking at the USA markings in the field, AT&T did not mark that they had lines present in the area. AT&T and Granite were able to identify the location outside of the new concrete and fix the issue.
Weekly Report
2/2025 Attended weekly progress meeting with Granite. Project moving forward Wkly Activity Report 2/25/25
3/2025
Attended weekly progress meeting with Granite. The anchor bolts the poles for the flashing beacons and ped push button poles are being held up by the pole supplier. They won’t release the poles until they get source inspected by Caltrans. Reached out to District 6 Office Chief and other Caltrans staff to get them to expedite this process as it is holding up the project and contractor scheduling. Caltrans METS will be doing the source inspection per Caltrans staff
Wkly Activity Report
3/1-8/2025
3/2025
The signal at 11th and Robertson is not censored and on a timer because of the wires that were dug up at the intersection. Waiting on Caltrans to have a contractor come out and pull new wires.
Wkly Activity Report
Reported by Admin
3/2025
Project ongoing. Attended weekly progress meeting with Granite. The anchor bolts the poles for the flashing beacons and ped push button poles are being held up by the pole supplier. They won’t release the poles until they get source inspected by Caltrans. Still waiting on Caltrans staff to get them to expedite this process as it is holding up the project and contractor scheduling. Caltrans METS will be doing the source inspection per Caltrans staff.
Wkly Activity Report
3/8-11/2025
4/2025
Attended weekly progress meeting with Granite. PAC West is scheduled to perform signal repairs at 11th St. Lead time to receive pole materials is about 3 weeks.
Wkly Activity Report
4/1/2025
4/2025
Project ongoing. Signal repairs at 11th St. completed. Stamped concrete poured in bulbouts. Attended meeting with Caltrans District 6 regarding source inspections. Lead time to receive pole materials is about 3 weeks.
Wkly Activity Report
4/5/2025
4/2025 We are just waiting on the crosswalk poles, the arches and the landscaping for the medians
Wkly Activity Report
4/08/2025 In Progress
Pickleball Court/Prop 68
Grant 10/2023
Conducted a bid opening for the Ed Ray Pickleball Courts. 9 bids were received. Engineer's estimate was $250k, with a low bid of $192k and a high bid of $310k. Began review of bids for completeness and responsiveness. Plan on brining to Council for award on 11/11/23.
Wkly Activity Report
10/15/23
12/2023
6.1 Resolution Awarding the bid for Construction: Prop 68 Grant Project - Pickle Ball Courts at Ed Ray Park to JT2 DBA Todd Companies, in the amount of $192,750. Upon analysis of the bids submitted, staff recommends awarding JT2 Inc. dba Todd Companies the agreement as the lowest, responsive bidder.
12/12/2023 New
Business
4/2024 Construction started 4/22/24. Estimated completion August 2024 Weekly Activities Report 4/27/2023
7/2024
Pickleball Courts Project – Construction completed. City inspector to verify that all contract items are complete. Possible Notice of Completion to City Council on July 23rd council meeting.
Weekly Report
8/2024
Staff will be putting up a 6ft fence around the courts. Not for security but for aesthetics and convenience of not having to chase the balls. Staff is looking into the cracks that were identified and will speak to contractor.
3.4 Consideration and Adoption of a City Council Resolution (48-24) Accepting Improvements and Authorizing the Filing of the Notice of Completion for the Prop 68 Grant Project – Pickleball Courts at Edward Ray Park (Rogers)
Motion by Council Member Barragan,
Seconded by Council Member Troost to
Approve the Consent Calendar as
Presented. Motion passed by roll call
vote with Mayor Smith absent.
Completed
Kings Ave Storm Drain
Project & ADA Sidewalk
Improvement Project
Attended meeting with HCD to discuss CDBG Planning Grant Applications. HCD requested additional edits and documentation.
Compiled and edited as requested and submitted to HCD for review and approval. Planning grant would provide approx. $188,000 for design of Storm drain improvements on Kings Ave.
Wkly Activities
Update 4/23/23
Sonoma Storm Drain
Project/ Urban Runoff 4/2023
Received the 100% design plans for the Prop 1 - Urban Runoff Project (Sonoma Storm Drainage Project) Reviewed and submitted to SWRCB for review and comments.
Wkly Activities
Report 4/16/23
10/2023 Received several questions from potential bidders on the Urban Runoff Project. Answered questions and posted addendum to the bid notice Wkly Activity Report
10/18/23
10/2023
Received additional questions from potential bidders before the question submittal deadline on the Urban Runoff Project. Answered questions and posted addendum to the bid notice. Bid opening on 10/26/23.
Wkly Activity Report
10/15/23
10/2023
Conducted bid opening for the Urban Runoff Project (Sonoma Storm drain) and received 7 bids. Engineer's estimate was $3.1-million with a low bid of $2.8-million and a high bid of $5.1-million. Began review of bids for completeness and responsiveness. Plan on bringing to Council for award on 11/14/23.
Wkly Activity Report
10/22/23
11/2023
New Business: 6.1 Resolution Awarding Contract for Urban /runoff Management Project for $2,811,990 to Rolfe Construction. Staff has reviewed the bid submitted by Rolfe Construction Inc. along with information regarding their previous work experience. Based on the review, Staff has determined the bid submitted is responsive and Rolfe Construction Inc. to be a responsible contractor. Staff recommends City Council award the contract, for the Urban Runoff Management Project to Rolfe Construction Inc. and authorize the construction contingencies in the amount of 10% of the contract, as approved by the Public Works Director.
4/2024
PW: Construction scheduled to begin April 22; contractor to meet with staff first to verify irrigation lines. The Urban Runoff Project, aka Sonoma Drains Project, began on 4/11 with construction mobilization, and, safety fencing was erected at Ed Ray Park.
Weekly Activities
Report 4/20/2024
4/2024 Project started 4/25/24. Anticipated completion December 2024. Weekly Activities Report 4/29/2024
7/2024
15th street is closed to through traffic by the park
The softball fields are done but they are working on the parking lot and street. Rest of the project should be done by December.
Weekly Activities
Report 7/9/2024
7/2024 Sonoma Storm Drain is under construction; Ed Ray parking lot still needs to be completed as well as inlets and pipe installation along Sonoma. City Administrator 8/2024
There are some compaction issues due to there not being a sub foundation under the current road. This is causing a larger scope of work which is higher costs. For the second time now, the contractor has hit a gas line and residents had to evacuate. Additional funds were awarded to complete the project.
8/31-9/3
Multiple gas line breaks in the last week or so; 1st two were because PGE did not mark the lines correctly. The 3rd was due to the contractor (that was the one that caused the school to be evacuated).
1/2025
Construction ongoing. Contractor working on punch-list items and additional patching. We anticipate it being fully completed by January and brought back for project acceptance.
3/2025 Contractor is re-grading Kites Field to meet project requirements.
Worked on progress report for submittal to the SWRCB
Weekly Activities
Report 3/1-8/2025
3/2025
Contractor is re-grading Kites Field to meet project requirements.
Worked on progress report for submittal to the SWRCB. Met with SWRCB to discuss current reimbursement request and future closeout of the project
Weekly Activities
Report 3/8-11/2025
3/2025 Final hydroseeding completed. All items completed. Staff working on closeout of the project.
Weekly Activities
Report 3/29-4/1/2025
4/2025 All items completed. Staff working on closeout of the project. Wkly Activity Report 4/8/2025 Complete
Former Library Building 5/2024
MOU signed by both parties June 2023. as of 5/7/24, the Historical Society has not received any updates from the State regarding their State Historical Designation application.
9/2024 5.1 Discussion and/or Direction of the City of Chowchilla’s Former Library and Future Use of the Facility (Rogers)
The City Council directed staff to verify
if the state received the application sent
in by the Chowchilla Historical Society
and bring back the result at the next
City Council meeting.
10/24
Consideration and Adoption of a City Council Resolution (56-24) to Extend the Annual Public Review Period for Expenditures Related to Measure T to 30 Days (Rogers)
It was the consensus of the city council
to bring the MOU back to council to
decide whether or not to amend it.
10/2024
Bringing this back to council with a updated timeline since MOU was approved. The State did confirm they received an application now but they state it appears they have not seen this before, because there are a lot of issues with it and would have been addressed if submitted previously.
The application will be kicked back because of the issues and will need to be resubmitted. They stated it could take up to year to review once the application is accepted and revisions are made.
Reported by City
Admin Weekly
Update ending
10/1/24
3/2025
Update on the Library
• The Historical Society has finished updating the application and we need to review and approve before submittal
Weekly Report -
Reported by Admin
Green Hills 9/2024
6.1 Consideration and Approval of a Well Installation Permit Application Pursuant to Chowchilla Municipal Code Section 8.20 and 13.04 Requested by Pheasant Run, LLC (Rogers)
Motion by Mayor Pro Tem Ahmed,
Seconded by Council Member Barragan
to Approve a Well Installation Permit
Application Pursuant to Chowchilla
Municipal Code Section 8.20 and 13.04
Requested by Pheasant Run, LLC.
Motion passed by roll call vote with
Council Member Troost abstaining.
Ed Ray Park Tower 11/24 Discussion and Request for Direction Regarding Construction of an Emergency Services Communication Tower at Edward Ray Park (Rogers) It was the consensus of the City Council
chose the monopole design.
3/2025 Awarding bid for new communication tower at Ed Ray park • Lowest responsible bid was $185k
Wkly Activity Report
Reported by Admin
Airport/FAA 4/23 Reviewed CatEX environmental documents for future potential airport projects and submitted to the FAA.
Wkly Activities
Report 4/2/23
5/2023
1.1 Consideration and Adoption of a City Council Resolution (35-23) Accepting Improvements and Authorizing Filing of the Notice of Completion for the New Beacon and Beacon Tower Project (Rogers).
Actions following approval: Filing of the Notice of Completion with Madera County Recorder. Release of 5% retention in the amount of $9,259.25 to Vellutini Corporation dba Royal Electric Company.
Motion by Council Member Ahmed,
Seconded by Council Member Troost to
approve the consent calendar as
presented. Motion passed unanimously
by roll call vote.
Consent 5/30/23
8/2024
6.4 Consideration and Adoption of a City Council Resolution (52-24) Awarding Consultant Services for Airport Engineering Services, and Planning & Environmental Consultant Services to Brandley Engineering, Inc. and Authorizing the City Administrator to Execute the Agreements on Behalf of the City (Rogers)
Motion by Council Member Troost,
Seconded by Council Member Barragan
to Approve City Council Resolution
#52-24, Awarding Consultant Services
for Airport Engineering Services, and
Planning & Environmental Consultant
Services to Brandley Engineering, Inc.
and Authorizing the City Administrator
12/2024
Jason and I had a meeting with FAA the previous week to discuss the “White Buildings.” No real change from the opinion letter but are looking to get another meeting with a different department within FAA Admin Weekly
Report
1/2025
Reached out to FAA to follow up on Salter’s situation and they are still waiting on a response for clarification on “congregation of people” and I have not heard back on the other department information to request a meeting. Sent another follow-up email requesting information on 1/8 Admin - Weekly
Report
On Going
Chowchilla Boulevard
Rehab & Water Stub Outs 7/2024
Construction ongoing. Pavement completed. Striping completed and road re-opened. Waiting on pipe to be delivered for continuation of the water main stub outs.
7/2024 Construction ongoing. Paving to continue July 10th Weekly Reports On Going SR 99/233 Interchange
(2017)
Resurface State Route 233 (Robertson Blvd) from Avenue 24 ½ to State Route 99 (2.1 miles)
Caltrans staff was recently informed
that the above project could be eligible
to receive an additional $4,000,000 in
IIJA funds from the USDOT to
incorporate additional “Complete
Street” and “Safety” elements
12/2023 Attended monthly Status meeting for the Chowchilla Interchange Project (roundabouts)
Wkly Activity Report
12/10/23
5/2024
Caltrans still in design. Due to the Community Project Fencing (CPF) request that was submitted by PW, received notification from Congressman Duarte's office that he is interested in the SR 99/233 Chowchilla Multimodal Interchange Improvement Project (roundabouts) for consideration of $7-million for FY25.
7/2024
Attended a meeting with Caltrans to discuss ROW for the Chowchilla Interchange (Roundabouts) project including access control, relinquishments, and utility easements
1/2025
Attended SR 99/233 Chowchilla Interchange Project:
MCTC/City/Caltrans Monthly Check In. The Right-of-Way limits have been set and Caltrans will begin the process to acquire the ROW. 30% Design completion anticipated by Summer 2025.
On Going
Smart Sheets
Project / Description Date Update Motion/Approvals Info Source Status Notes Community Facilities District 4/2024
Met with Rancho Calera to discuss CFD scenarios for 137 acres not currently in the 2006-1 CFD; and, met with Luis Gill to discuss the CFD and next steps.
Weekly Activities Report
4/27/2024
10-2024
Met with CFD team to discuss a new one for the 137 Acres of the Rancho Calera project not in the current CFD. Met with Precision Engineering to discuss the Industrial Specific Plan Environmental.
Discussion about a Program level vs Project level EIR. They believe a Program level will be better since we don’t have a lot of projects lined up for the area as a whole.
Reported by Admin
1/2025
Scheduled a CFD meeting for Rancho Calera and the City’s 2006-1 CFD refunding. 1/16- will discuss next steps for both but the City’s can’t start until sometime in February and there will be items coming on the agenda for approval of the CFD team.
11/24
Consideration and Adoption of a City Council Resolution Approving a Reimbursement Agreement, Designating Consultants, and Authorizing and Directing Certain Actions Related to the Proposed Formation of a Community Facilities District (Pruett)
Motion by Council Member Troost, Seconded by
Mayor Pro Tem Ahmed to Approve City Council
Resolution #65-24, Approving a Reimbursement
Agreement, Designating Consultants, and Authorizing
and Directing Certain Actions Related to the Proposed
Formation of a Community Facilities District. Motion
passed with Council Member Barragan absent.
On Going
Maple Meadows Project 12/2024
This is the affordable housing apartment complex going on the vacant lot off Washington and Maple. They are asking for a reduction in our parking requirements to allow only a 1:1 ratio of parking spots to units. The concern is overflow parking and where it will go and we don’t want parking on Washington as both sides currently do not allow it.
3/2025
Annalisa and I met with SHE in regards to the Maple Meadows project and Washington Rd/Robertson Blvd intersection
improvements. • Caltrans is requiring a roundabout there and this project would have to pay its fair share
• Orchard View paid their fair share
Reported by Admin
3/2025 The civil improvement plans are approved Wkly Report Auto Zone Distribution Facility 7/2024
AutoZone is having issues with Union Pacific Railroad; UPRR is not allowing them to complete the boring that was previously approved by UPRR. Staff is working with them and believe they have a path forward by moving the vault by the airport. Staff is going to set up a meeting with UPRR to see if we can help once we get all the information from AutoZone.
Reported by Admin
9/28-10/1 2024 FCL is going to attempt to pull the underground pipe that will hold the PGE lines onto the airport property on Thursday. Reported by Admin 10-2024
attempt was unsuccessful, FCL has submitted to abandon the pipe they bored and add 2 separate pipes 3 feet to each side of it. Waiting to hear back from UPRR. UPRR was contacted and involved with trying to get the issues with boring for PGE resolved. They are now going to try and pull a 6” pipe through the 10” pipe and the n extend that 6” pipe the extra 5 feet they need to be out of Zone A and be on our airport property where we have an easement with them. They were successful in pulling a 6” conduit through the 10” pipe and onto our Airport property.
Reported by Admin
11-2024 They are now waiting on PGE to get the power to the vault and then to their building. Reported by Admin
12-2024
Still waiting on PGE to get the power to the vault and then to their building . Had a meeting with the AutoZone team on Wednesday 12/11 @ 2:00 • Discuss them shipping by the end of January while on temporary power because they are waiting on PGE. PGE was contacted - government representative to help get this process moved along. Received an email from Joe Roman that was forwarded from FCL that PGE was able to expedite the request and they are scheduled to get power to them on 1/15. It was previously scheduled for mid March.
Reported by Admin
1/2025 PGE was out on 1/15 installing a new pole and starting the process to get them energized Reported by Admin In Progress
ADHOC: Zoning Ordinance 12/1/2024
Consideration and Approval of a Planning Commission Resolution Recommending Approval of Zoning Ordinance Text Amendment # 24-0600 to the City Council With Findings and Conditions as Set Out in the Resolution (Perea)
Motion by Co-Chair Salter, Seconded by
Commissioner Hale to Approve Planning Commission
Resolution #24-06, Recommending Approval of
Zoning Ordinance Text Amendment # 24-0600 to the
City Council With Findings and Conditions as Set Out
in the Resolution. Motion passed by roll call vote.
Shipping Containers Ordinance
Update
Department: Community Economic Development
Quarterly: October - December 2024
Oleander Terrace 4/2024 Staff meet with the builder for Oleander Terrace, discussing the construction of the masonry wall along Howell Avenue.
Wkly Activities Update
4/16/2023
5/2024
Staff continues to work with the developer with completing the project’s obligations. The Developer continues to work on addressing various issues, while starting units in small batches.
Wkly Activities Update
05/28/2024
6/2024
Staff continues to work with the Oleander Terrace Developer.
Assisting him to help keep the project from stopping. Staff was informed one of their former sub-contractors was reconstructing Howell Road. Builder is in the process of constructing homes at this location. Half of the homes have been constructed (14/28).
Wkly Activities Report
6/25/2024
8/2024 Project is under construction, Builder has constructed approximately 20 units, has approximately 8 units to be constructed. In Progress Mobile Food Vendor Trucks &
Sign Ordinance
7/2024
Staff worked with Code Enforcement notifying a food vendor they were not incompliance with the recently adopted food truck ordinance. Upon notification, the food truck operator submitted a complete application package for staff consideration. The food truck owner was notified they would not be able to operate within the City until their use permit and business license was approved.
Weekly Report
8/2024
Staff has approved 2 mobile food trucks. Staff received an application for a new food truck and in process of reviewing the insurance of an ice cream truck to ensure the insurance is in compliance with the municipal code.
11/2024
Consideration and Adoption of a City Council Resolution Initiating a Text Amendment to Amend the Sign Ordinance and the Mobile Food Vendor Ordinance (Perea)
Motion by Council Member Troost, Seconded by
Mayor Pro Tem Ahmed to Approve City Council
Resolution #60-24, Awarding a Contract to VM Lyles
Company for Civic Center and Well 15 Generator
Improvements Project in the amount of $1,190,560.00
and Authorizing the City Administrator or Designee to
Execute All Related Documents Thereto and
Amending the Fiscal Year 2024/25 City Budget.
Motion passed with Council Member Barragan
absent.
12/2024
introduction of an Ordinance Amending Chowchilla Municipal Code Section 18.56 – Signs and Outdoor Advertising Structures, and the Accompanied Notice of Exemption (Perea)
12/24
Introduction of an Ordinance Amending Chowchilla Municipal Code Section 9.07 – Food Truck Vendor, and the Accompanied Notice of Exemption (Perea)
1/2025
Adoption of Ordinance Update- Mobile Food Vending. 2nd readingupdated for ice cream trucks. Adoption of Ordinance Update- Signs and Outdoor Advertising. 2nd readingupdated for height and sq footage of face requirements along the highway 99 corridor
Consent
Downtown Guidelines 12/2024
Consideration and Adoption of a City Council Resolution Approving the Updates to the Downtown Design Guidelines Along with the Notice of Exemption as Set Forth in the Resolution (Perea) Motion by Commissioner Hale, Seconded by
Commissioner Vander Dussen to Approve Planning
Commission Resolution #24-07, Recommending the
City Council Approve the Updates to the Downtown
Design Guidelines Along With the Notice of
Exemption as Set Forth in the Resolution. Motion
passed by roll call vote.
Industrial Specific Plan
The Industrial Specific Plan was considered by Council in 2018 but the environmental review was never completed. Council budgeted in FY 23/24 to have staff draft an RFP for the solicitation of an environmental consultant to assist with completing the document which then allow the City to adopt the ISP.
Motion by Council Member Chavez, Seconded by
Council Member Troost to Approve City Council
Resolution #59-24, Initiating a Text Amendment to
Amend the Sign Ordinance and the Mobile Food
Vendor Ordinance. Motion passed with Council
Member Barragan absent.
7/2024
Industrial Specific Plan EIR: Staff has routed the document for signatures. Once all parties have signed the agreement, staff will have the agreement executed.
Weekly Report
CV2 & CV3 3/2023
Staff met with HSR regarding proposed Right-of-Way Acquisition plan. They mentioned they have began starting conversations with various property owners along the corridor and wanted to ensure they have included all the necessary items needed to within the ROW design.
Wkly Activities Report
March 26, 2023
4/2023
Admin - Attended multiple meetings with property owners in the CFD to discuss the new proposed CFD. AutoZone, Rancho Calera, Chafal-Commercial along East 99, Gill 70 acres industrial next to AutoZone. We got positive feedback from everyone so far. Meeting with property owners to get support but only the registered voters have a vote. Developed residential will have a 35% - 40% reduction in annual assessments so we anticipate support from voters. Still have more meetings to do and have to revise some of the presentation based off input from property owners. Admin - Attended multiple meetings with property owners in the CFD to discuss the new proposed CFD. AutoZone, Rancho Calera, Chafal-Commercial along East 99, Gill 70 acres industrial next to AutoZone. We got positive feedback from everyone so far. Meeting with property owners to get support but only the registered voters have a vote. Developed residential will have a 35% - 40% reduction in annual assessments so we anticipate support from voters. Still have more meetings to do and have to revise some of the presentation based off input from property owners.
Wkly Activities Report April
9, 2023, April 16, 2023,
April 23, 2023
5/2024 Staff processed one additional EDLP and is now beginning the closeout process for this program with HCD.
8/2024 Staff is in the process of working with our vendor to begin the close out process. In Progress
Century Communities: Lone
Oak Subdivision/Orchard View
Staff attended a meeting with the Lone Oak Developer regarding the next steps for the project. The main topic of discussion was the proposed phasing plan proposed by a perspective builder.
Weekly Activities Report
July 25, 2023
Staff provided information to the Lone Oak Developer regarding moving forward with a Lot-Line adjustment application. Once processed, this application will allow the developer to sell a portion of the project to the perspective builder.
Weekly Activities Report
July 2, 2023
1/2024 In escrow with Century Communities; property purchased from John Sessions. Meeting held to set milestones to keep project moving. 5/2024
Century Communities renamed the development Orchard View. They started grading the property and received the Encroachment Permit in May.
7/2024
Staff drafted an Administrative Report for council consideration for the July 9th council meeting. The item to be presented to Council for consideration is regarding the annexation of the Orchard View Subdivision into the City’s Services CFD.
Weekly Activities Report
8/2024 Century Communities has started construction and is currently in process of installing the off-site improvements.
1/2025 Coordination with Century Communities to get their Final Map recorded Weekly Activities Report In Progress
Rancho Calera 5/2023 Com Dev. - Staff received a parcel map application to create a parcel within the Rancho Calera Community.
Wkly Activities Report,
May 7, 2023
5/2023
Attended a meeting with mark and the Fagundes team to discuss the CFD refunding. They seemed to support it and wanted to get more details. We are working on putting together a more detailed presentation for all property owners so they can see the actual financial impacts on their assessments under the new proposed plan.
Wkly Activities Report May
14, 2023
5/2023
Staff forwarded the comments received by QK regarding Pembrook's Development team Final Parcel Map request. The comments were immediately forwarded to the applicant to make the corrections and resubmit.
Wkly Activities Report May
21, 2023
Had a meeting with the Rancho Calera team to discuss the results of out meeting with Caltrans. They think they can put together a plan for the commercial are right off the roundabout that will satisfy Caltrans concerns.
Wkly Activities Report June
4, 2023
6/2023
Staff continues to work with the Rancho Calera Team regarding the submittal of a Final Map application and fascinating access to the proposed commercial development.
Wkly Activities Report June
4, 2023
1/2024
Staff Continues to meet with Caltrans regarding the commercial connection. Staff received an application from the developer to create a parcel to be sold to a builder.
5/2024 Staff is working with the developer with processing a Lot Merger, Tentative Map for Block 3, and the Final Map for Block 4. 7/2024
Staff met with the Rancho Calera Team regarding their future plans for the Western portion of the development. They have expressed an interest of moving forward with annexing the western portion of the development into a CFD and preparing one of the neighborhoods for Final Map consideration.
Wkly Activities Report
8/2024
Staff continues to work with the developer; they informed staff that they have a commercial builder looking to purchase the commercial portion of the project.
11/2024
Consideration and Adoption of a City Council Resolution Approving the City Administrator or Their Designee to Sign the First Amendment to the Development Agreement for the Rancho Calera Specific Plan (Pruett)
12/2024 Rancho Calera Block 3 – worked with HMH engineering on the removal of 3 conditions that were not applicable to Block 3. Weekly Report 12/1/2024
Consideration and Approval of a Planning Commission Resolution Recommending the City Council Approve Tentative Subdivision Map # 24-0112 for Block 3 of the Rancho Calera Specific Plan Along With the Notice of Exemption as Set Forth in the Resolution (Perea) City Council
01/2025
worked with HMH engineering on the removal of 3 conditions that were not applicable to Block 3 Weekly Report
1/2025
will discuss next steps for both but the City’s can’t start until sometime in February and there will be items coming on the agenda for approval of the CFD team
Wkly Report 1/14/2025
3/2025 approved resolution to adopt the Tentative Subdivision Map for Block 3. Wkly Report 3/-4/2025
In Progress
Mid Valley Pipe & Steel 11/2022 Property is in Escrow. The buyer is to start the entitlement process.
RDA Successor Agency Resolution No. 05-22.
12/2023 Property is going through the escrow process. Staff received a draft site plan to be reviewed.
1/2024
APN 002-250-053: Staff is working for future builder on plans to build a new facility and business park that will have approximately 8 lots ranging in sizes of 1 to 5 acres. Staff will close escrow Spring of 2024.
5/2024
The property transferred ownership to Mid-Valley Pipe and Steel in April. The applicant is in the process of completing the environmental review for the project.
In Progress
Legacy Ranch 4/2023
Admin - Attended a CFD meeting with Legacy Ranch. We have one more with land owners to do for our 1st go around. Woodcrest - Fagundes. Comm Dev. - Staff met with the owners for Legacy Ranch to discuss the conceptual revisions to CFD 2006-1.
1/2024
Staff received a lot line adjustment application. Once the lot line adjustment is processed, the developer plans to sell the easterly parcel to a builder.
On Hold
Housing Element 5/2024
Staff continues to work our consultant and HCD addressing HCD comments. Once HCD comments have been address, our consultant will begin the second part of the project which consist of updating the City’s General Plan.
7/2024
Staff began the review process for a Development Agreement received from the Chowchilla Union High School. Once the City’s Economic Ad-Hoc Committee has reviewed the proposal, staff will work with the applicant and legal to finalize and have it scheduled for council consideration.
Weekly Report
7/1/2024
Did not have a quorum for the July 17 Planning Commission meeting, putting off the Housing Element item to their August 21 meeting
10/2024
4.1 Consideration and Adoption of a City Council Resolution Approving General Plan Amendment Application No. 24-0297 Approving the 2024-2032 6th Cycle Housing Element and the Accompanied Environmental Review (Perea)
Motion by Council Member Troost, Seconded by
Mayor Pro Tem Ahmed to Approve City Council
Resolution #53-24, Approving General Plan
Amendment Application No. 24-0297 Approving the
2024-2032 6th Cycle Housing Element and the
Accompanied Environmental Review. Motion passed
unanimously by roll call vote.
On Going
1/2025 Internal meeting with PCE to discuss Housing Element program implementation Weekly Report
3/2025 2nd reading of the Zoning text amendment relating to the Housing Element
Weekly Activities Report -
Reported by Admin
3/2025
Text Amendment #24-0762 to implement Housing Element
Program HE-2(l) Lower Income Opportunities – approved ordinance to introduce and waive 1st reading for the item. Item will go to 3/11 meeting for adoption.
Weekly Activities Report
3/1-4/2025
4/2025 The Council will receive the consideration of adoption for the General Plan Annual Progress Report and the Housing Element Weekly Activities Report
April 8, 2025 (Consent)
CUHS Project 5/2024
The Lot Merger application is being review by the City Engineer.
Staff continues to work with their Architectural Firm with finalizing the plans.
7/2024
Staff began the review process for a Development Agreement received from the Chowchilla Union High School. Once the City’s Economic Ad-Hoc Committee has reviewed the proposal, staff will work with the applicant and legal to finalize and have it scheduled for council consideration.
Weekly Report
8/2024 Construction started; awaiting lot merger comments from QK and legal is reviewing the draft development agreement.
12/2024
Consideration and Adoption of a City Council Resolution Approving a Deferred Improvement Agreement with the Chowchilla Union High School District Regarding the Chowchilla High School
Transportation Center and Authorizing the City Administrator to Execute all Related Documents (Pruett)
In Progress
Other projects/items
Salters Distributing 2/2025 Reviewed site plan submittals for Salters Distributing expansion and provided additional comments back to ComDev
Weekly Activities Report
February 10, 2025
3/2025
Exposure to significant litigation- update on information from FAA regarding the white buildings on Salter’s property -Labor negotiations
Weekly Activities Report -
Reported by Admin
MADERA Co-EDC 4/2025
Met with Kristina Gallagher of the Madera Co-EDC on April 3, 2025.
The meeting was a touch-base regarding the support provided by EDC and what the City of Chowchilla’s Community & Economic Development could do to further attract business to the City. The meeting collaborative approach was to further build bridges and support for the community’s growth.
Weekly Activities Report
April 8, 2025
Golden Valley Pistachio 4/2025
The Golden Valley Pistachio application, has rec’d. its second comments letter and pending response. Additionally, the Fire Dept. has also provided comments and the department is pending the updated plans for the resubmittal process and review.
Weekly Activities Report
April 8, 2025
CED 4/2025
CED Director has reached out to other car dealerships out of the county to see about any interest in the purchase of the vacant Pacific Auto Sales location.
Weekly Activities Report
April 8, 2025
4/2025
The CED has contacted both Prologis the Phelan Development groups, regarding the City of Chowchilla’s-Industrial Specific Plan.
There have been no comments to date, and a follow up is planned. (NO CHANGE)
Weekly Activities Report
April 8, 2025
Brent Rose 4/2025 Followed up w/ Brent Rose, to discuss update or status of multi-use planned project and still pending a site visit. (NO CHANGE) Weekly Activities Report
April 8, 2025
3/2025 2nd reading of the Zoning text amendment relating to the Housing Element
Weekly Activities Report -
Reported by Admin
4/2025
The Council will receive the consideration of adoption for the General Plan Annual Progress Report and the Housing Element Progress Report for the year 2024, this was also provided and received approval at the previous planning commission.
Weekly Activities Report
April 8, 2025 (Consent)
Smart Sheets
Project / Description Date Update Motion/Approvals Info Source Status Notes Measure N 6/2023 6.5 Discussion and Recommendation to Form a Measure N Ad Hoc Committee, Appointing Two Members of the City Council. (Pruett).
Actions Following Approval: Follow the
direction and recommendations from Council.
Motion by Council Member Chavez, Seconded
6/13/2023 Council
Meeting
7/2024
Working on fliers to be sent out and planning for public outreach.
Joann submitted the ordinance that was approved by the County and a legal summary was provided as well. We will resume our meetings with the consultants and start woring on our outreah approach.
Reported by City
Administrator
7/2024
6.3: Measure N Ordinance Introduction to be placed on the November 2024 ballot; will be adopted, if passes election, on the following meeting after election results have been certified.
07/23/2024 Council
Meeting
9/28-10/1 2024 Sent response to leagal on FPPC Complaint 10/2 Reported by City Administrator
11/2024
Jeff did a Q & A Podcast for the POA. On election night it had an over 80% approval with roughly 2.8k votes submitted. Next updated results, and hopefully final results should be Friday 11/15 by 5:00pm.
There are only an estimated 1,700 votes left to count County Wide.
Next updated results will be 12/2 by 5:00pm. The 6th unprocessed ballot report previously showed 209 uncured votes county-wide but now it shows 242 so that is weird.
Reported by City
Administrator
11/2024 November Election: Measure N Passed Completed
3/2025
Resolution approving an amendment to our current agreement with MuniServices LLC for transactions tax audit and information • Needs to be updated for the renewal of Measure N
Reported by City
Administrator
LPR'S LPR's Installed Completed
Disposal of Surplus
1/2025
6.3 Consideration and Adoption of a City Council Resolution Authorizing the Disposal of Surplus City Property in the Form of Donating a 2020 Ford Explorer Police Interceptor to the Chowchilla Union High School Public Safety Department (Palmer)
Master Fee Schedule - CCW
3/2025
Adjusting the Master Fee Schedule
• Adding a fee for the Police Department now doing the Concealed Cary Permit (CCW)
Reported by City
Administrator
Quarterly: October - December 2024
Department: Police Department
Smart Sheets
Project / Description Date Update Motion/Approvals Info Source Status Notes Madera County Fire
Station 2017
6/27/2017 Council: 3.6 Authorize Fire Chief Harry Turner to Negotiate a Settlement of Madera County Contract No. 9006-C-2009 Pertaining to the Madera County Fire Station.
Action: Fire Chief is hereby authorized to negotiate
settlement. Action Following Approval: The Fire
Chief will negotiate with County representatives;
reach an agreed upon amount; vet the arrangement
with the City Administrator, Finance Director and
City Attorney; then bring the negotiated terms back
to council for its approval. Update from Gaumnitz
July 2020 - Still pending. CalFire may be looking
for a site outside of city limits. Update - Meeting
scheduled with Madera County Fire for Oct 15th.
Consent
2020
Staff met with County and CalFire to discuss
previous agreement to provide fire station or
expansion of our fire station to the County:
Supposed to provide a 2,200 sq. ft building for
them, Agreement has a monetized amount for that in
the contract but they want us to build the station -
today's cost are exponentially higher than the
monetized amount in the contract - have a meeting
scheduled for November to follow up.
Weekly Activities Report
Oct 11 - Oct 17, 2020
Administrator
2020
Staff meet with County regarding prior agreement to
provide a fire station to the County. We were
supposed to provide a roughly 2,200 sq. ft building
for them. They are to leave the PD building where
they currently occupy 2 bays. PD impact fess are to
be used. Issue is the agreed upon costs to build that
add-on/building has significantly increased since
2009. In agreement it is $243,800 which is $102
sq. ft. Now the County says the cost is roughly
$700 sq. ft = $1.5M. We are continuing to work
with the County to find a resolution.
Wkly Activities Report
November 8 - November 14,
2020 (Administration)
ON HOLD
Fire Expansion 7/2022 Phase 2 construction beginning late January 2024 5/2024 Should be completed by end of May 2023
8/2024 Unfortunately the fire system failed inspection, still waiting for the work to be completed before final walk through. Completed Quarterly: October - December 2024
Department: Fire Department
2/2025
Have a meeting scheduled for next week with the County
and Cal Fire to address an old agreement we have to relocate CalFire from the bays at the PD building.- It is an old agreement and the cost to now do that is much higher than originally thought and the contract is not clear if it is based on the square footage of the building or the cost listed in the agreement.
Wkly Report - Reported by
City Administrator
2/15-18/2025
2/2025
Chief Gaumnitz and I met with CalFire and Jay at the
County to try and get a resolution to an agreement we had a long time ago with the County to provide a new operating space and have them move out of the PD building. There
was square footage mentioned as well as dollar amounts
• Obviously the cost per square foot has gone up
significantly since the agreement
o We cant afford to build at today’s costs and they don’t really want to be located here
o Mentioned giving them the 4 acres we own next to
Autozone plus some money ear marked in PD DIF for this
very item
Jay is going to look at options we discussed and get back to us
Wkly Report - Reported by
City Administrator
2/22-25/2025
Weed Abatement 4/2024 Item to be in May city council agenda to kick it off 7/2024
Held a public hearing on July 23, 2024 council meeting
where affected property owners could have protested their citations. No one came forward to protest; weed abatement program continues.
On Going
Smart Sheets
Project / Description Date Update Motion/Approvals Info Source Status Notes Outreach Website Updates, E-News Bulletings, Social Media Postings On Going 1/2025 New Year/New Council Updates on Website On Going 1/2025 Assist on PMP Sheets with Staff On Going
1/25/2025
Revamped the Council Contingency Fund Manual & Application for staff review. Planning the year and selecting event dates
New Position 8/2024
6.3 Consideration and Adoption of a City Council Resolution (51-24) Amending the 2024/25 Salary Scale to Include Clerical/Recreation Aid Classification (Wisener)
Motion by Council Member Barragan, Seconded
by Council Member Troost to Approve City
Council Resolution #51-24, Amending the
2024/25 Salary Scale to Include
Clerical/Recreation Aid Classification. Motion
passed with Mayor Smith absent.
Completed
Events
7/2024 Open Swim, Music in the Park, Movies in the Park 1/2025 New: Kiddos Crafts Prepping for Easter, and summer events On Going 1/18/2025 Chowchilla SFA Crab Cioppino Dinner Completed 1/22-24/2025 LOCC Mayor and Council Member Conference in Sacramento Completed Rod and John Attending 1/25/2025 Annual Chamber Awards Dinner- City has a table Completed 1/25/2025 Kiddos Craft - New Years - Ed Ray Building Completed 2/15/2025 Kiddos Craft - Valentines - Ed Ray Building Completed 2/22/2025 CAF Dinner Completed
2/28/2025 Annual Cattle Drive, Robertson Blvd., 10am Completed 3/8/2025 Kiddos Craft - St. Patrick's Day - Ed Ray Building Completed 3/24-26/2025 ICSC Monterey Completed
4/5/2025 Fair Dinner Completed
4/8/2025 Goal Setting for FY 25/26 Budget- Before Council Meeting- at 2:00pm Completed 4/12/2025 City Easter Event - Ed Ray Park Completed
4/23-25/2025 LOCC City Leaders Summit in Sacramento
4/25/2025 CAF Golf Tournament
5/1/2025 National Day of Prayer - Not at Veterans Park this year but at Faith Hall 5/3/2025 Employee BBQ - Schnoor Park
5/15-18/2025 Chowhcilla Fair
5/17/2025 Spring Festival Parade
Veterans Boulevard 9/2024
6.1 Consideration and Adoption of a City Council Resolution Approving the Installation of Commemorative Veterans Boulevard Signs atop the Existing Wayfaring Signs Along the North and South Side of 5th Street (Wisener) Motion by Mayor Pro Tem Ahmed, Seconded by
Council Member Barragan, to Approve City
Council Resolution # 54-24 to Approve the
Installation of Commemorative Veterans
Boulevard Signs atop the Existing Wayfaring
Signs Along the North and South Side of 5th
Street. Motion passed by roll call vote.
Chamber of Commerce 12/24 Consideration and Adoption of a City Council Resolution to Approve a Budget Amendment and Distribute a Financial Contribution to the Chowchilla District Chamber of Commerce for the 2025 Calendar Year (Wisener) Consensus to bring back to council after a
meeting with the Chamber Director
Senior Center 12/24 Reached out to Director to request they submit a letter requesting the funds we are contracted to pay for auditing purposes.
12/24 Visited the Senior Center to check in, delivered city swag to senior citizens Sports Organizations 1/2025 Completed all new field use agreements to send to council for approval on 1/28 meeting
1/18/2025 Met with Soccer President to go over their contract Quarterly: October - December 2024
Department: Recreation & Community Outreach
Smart Sheets
Project / Description Date Update Motion/Approvals Info Source Status Notes Committees 1/2025
Planning Commission and Airport Advisory
appointments, Have multiple applicants for 2 positions
on PC. applicant applied for both the PC and Airport
Advisory
Completed
Planning Commission
has all 5 seats filled;
The Airport Advisory
still needs to fill 3
vacancies.
4/2025
•Completed the April 8 regular and goal setting city
council meeting agenda process.
• Followed up on a few liability claims; including a major claim regarding a motorcycle v car accident that occurred by Stephens Elementary where there are no stop signs;
filed a claim for an employee whose personal vehicle was struck by another employee in a city vehicle.
• Had 7 public records requests come in this week for PW projects; 6 cam from one person, John Dougherty, and 1
from Foundation for Fair Contracting regarding the Urban Runoff Management Project. There were several other
public records requests for various or recurring
information re: business licenses of previous month,
code enforcement violations of the previous month, and
another request for body cam footage that we ultimately denied because they are considered investigatory files
therefore exempt from disclosure.
• Assisting Vanessa with certain office procedures; gave her info to follow up on related to clerking.
• Miscellaneous day-to-day city clerking tasks.
Weekly Activites Report
District Based Elections 04-2024
Held 2 pre-mapping public hearings, April 9 & 23. Will
hold mapping public hearings May 14, 28, June 11, unless otherwise scheduled
City Clerk Completed
06-2024
Introduced ordinance adopting district maps, sequencing; Map 401 adopted on June 11 with 4 districts and mayor at large.
City Clerk ongoing 2026 will incorporate
the other two Districts
Public Records Request
Management Software Mar-25
City Administrator signed the contract with NextRequest for a start date of July 1, 2025. Training/implementation to start in May 2025 City Clerk ongoing
Records Retention
Schedule Update Jan-25
City Clerk sent out the updates to Departments to review and sign off on; City Clerk ongoing
Mar-25
City Clerk has most of the sign off sheets returned; there is still some holdout from a few departments. City Clerk Ongoing EVENTS 5/21/2025 Planning Commission Meeting, Council Chambers, 5pm Quarterly: October - December 2024
Department: City Clerk
Smart Sheets
Project / Description Date Update Motion/Approvals Info Source Status Notes Personnel
Hired a part time Driver/Dispatcher to help with coverage.
Attended CalACT Spring Conference with Robin Roman.
Department needs one full time employee in operations and one full time employee in administration for coverage. There is a lot of $ to do projects with (other than bus purchases) but requires additional staff to manage the grants after award which includes reporting.
On Going
5311 Operating Grant
Transit Supervisor Roman uploaded the bi-annual
Certifications and Assurances for this upcoming 5311
operating grant cycle. Staff report to apply for Section 5311 will be on May agenda
On Going
Unmet Tansit Needs
MCTC held unmet transit needs public hearings for
Chowchilla, City and County of Madera transit agencies, to obtain public input on local transit needs. MCTC will
compile information and hold another hearing at the board offices to review unment needs and evaluate them based on many factors. SSTAC met over MAdera City/County and
Chowchilla's unmet needs submitted by the public in
respective areas and recommended that Chowchilla's unmet transit needs are not reasonable to meet. the governing board, MCTC, still needs to approve the recommendation by resolution at their Policy Board meeting on May 29.
On Going
Annual CHP Inspections
CHP sucessfully completed the "desk audit" portion of its annual inspections. They will soon return to complete the driver terminal record inspection.
On Going
Annual DBE Reporting
for 5311
There is a DBE report that Transit completes annually;
Robin completed this on 4/26/24 On Going
Annual TDA Application Robin Roman completes the application to receive TDA funds On Going
5339 Grant
5339 grant funds were used to purchase a CNG bus and is expected to be delievered soon, more than likely in the 24/25 fiscal year.
On Going
Electrification of Bus
Fleet 12/23
Staff has submitted and the state has accepted the grant application for SB 125. CATX is proposing unsing the grant funds to cover costs of electrifying its fleet. This will include consultation, engineering, planning, purchasing and
installation.
In Progress
7/2024
Received a letter from CalSTA that they approved three out of the four projects that were submitted in the allocation package; $810,725 of TIRCIP funds and $895,350 ZETCP
funds for planning electrification of transit fleet (includes installing chargers/infrastructure) and purchase of one ebus.
In Progress
Quarterly: October - December 2024
Department: Fire Department
Smart Sheets
Project / Description Date Update Motion/Approvals Info Source Status Notes Compensation Study 7/2024 Met with a few vendors to obtain quotes for a compensation study. In Progress CFD: Greenhill's 6/1/2023
Had a meeting with NBS and the Greenhill's & Pheasant Run bond legal team.
Discussed what to do with any cash on hand or monies that come in after the Greenhill's bond were issued for. Considering using towards Well 16 which will be on the east side. Also discussed Pheasant Run and the delinquencies. I directed them to proceed with delinquency letters.
5/2024 Sent out new delinquencies for Pheasant Run On Going CFD: Infill 2024 CFD Refunding failed special election; City Administrator working through next steps.
Quarterly Financial
Review On Going
Audit 1/2025 Auditors were out last week for an internal control walkthrough. They are out this week doing their fieldwork. On Going
Reporting 1/2025 Completed 2 out of the 3 State Controller Reports, finishing the 3rd one this week; Working on the CDIAC Reporting. On Going
Annual report on Development Impact Fees- AB 1600. It is a state requirement to report on the balance of DIF, new DIF received and what we spent DIF on Public Hearing: Reported By Admin Budget
1/2025 Will be sending out Budget Worksheets to Department Heads this week to get ready for Mid-Year On Going
APP.F2.2 4.2 Consideration and Adoption of a City Council Resolution (44-23) Updating the City's Procurement Policy and Procedures. (Pruett)
Motion by Council Member
Chavez, Seconded by Mayor Pro
Tem Smith to Approve City
Council Resolution 44-23,
Updating the City's Procurement
Policy and Procedures. Motion
passed unanimously by roll call
vote. Actions following
Approval: The Policy will be
updated with the language
provided in the Resolution.
Public Hearing Completed
6/18-24, 2024
Will have to bring back the procurement ordinance update back to Council in July. The resolution updated the policy only; the ordinance updates the municipal code.
Weekly Activities Reported by Admin Completed
Quarterly: October - December 2024
Department: Fire Department
Smart Sheets
Project / Description Date Update Motion/Approvals Info Source Status Notes DC Migration Major Project
Preparation and Health Check, Upgraded Domain Functionality, Transferred Key Roles, functions and responsibilities from the old primary domain controller (DC1) to the new server (SV-DC1).
DNS Settings Updated, Transferred essential software Duo and Passportal to the new servers, Addressed specific technical issues encountered during the migration process. Moved the DHCP service to new dedicated, servers (SV-IP1 and SV-IP2).
Migrated the NPS service from the old server (DC2) to the new server (SV-DC2). Ensured smooth integration of LDAP services with the new primary server (SV-DC1). Established a new certificate authority on the new server (SV-DC1) to ensure secure communications. Modified Firewall RADIUS and Active directory integration configurations.
On Going
Duo AD MFA Project 1/1/2025 Distributed Duo fobs to fire department staff for enhanced security. Wkly Report On Going Tyler 1/1/2025
Provided Tyler Technologies technician Nick Peyton with access to the Tyler Incode app server to resolve the issue concerning email bill reminders.
On Going
Sophos Exclusions for Tyler Technologies. Added 43 requested exclusions to Sophos as per Tyler Technologies’ requirements.
Uptime Tracking Project Project is progressing as expected. Wkly Report 4/8/2025 On Going New Phone System Project
Worked with the Mitel deployment representative on the new phone system, providing a workstation and assisting with the deployment of 3 new servers. AT&T installed a BGW320 ATT Gateway at 122 Trinity Ave, connected to a Ciena 3930 switch. IT is working on server creation and IP setup, with a contract upgrade to standardize extensions to Mitel 6920 and add a PA interface module. The circuit is now live, with a plugand-play setup. Equipment programming is in progress. Once complete, the equipment will be shipped, and tracking info will be shared. Porting is pending confirmation from the LNP team, with further updates to follow.
Wkly Report 4/8/2025
ON HOLD -
Waiting for
number to
become
available for
porting
Rims Migration Now that Vmware has been finalized we can migrate the last 2 remaining servers which are the 2 Rims Servers. We plan to do this 1 at a time to minimize any potential issues that may arise.
Wkly Report 4/8/2025
ON HOLD -
Waiting to
schedule
New Backup System VEEAM Deployment
The Veeam backup system deployment is progressing as expected. IT is currently backing up most of our systems to ensure full data protection. We're just waiting to finalize the contract with Veeam, and once that's done, we’ll complete the deployment and ensure everything is fully integrated. finally received licensing from vendor project will continue.
Wkly Report 4/8/2025 On Going
WWTP Camera System Project Update
All necessary equipment for the project has been received. IT began by configuring the cameras, creating DNS records, and setting up IP reservations. Once the initial configuration was completed, plans were made to coordinate with Public Works for installation at the WWTP building.
Currently, the cameras, DVR, and point-to-point (PTP) connection have all been successfully set up. Public Works (Mario) has begun installing the devices intended for the WWTP shop location. Ongoing.
Wkly Report 4/8/2025 On Going
Quarterly: October - December 2024
Department: Info Technology
REPORT TO THE CITY COUNCIL
Item 3.6
CLICK HERE
TO RETURN TO
THE AGENDA
Meeting of: April 22, 2025
AGENDA SECTION: Consent
SUBJECT: Consideration of Quarterly Waiver Report
PREPARED BY: Rod Pruett, City Administrator
ATTACHMENTS: Detail of Waivers Issued
REVIEWED BY
ADMINISTRATOR ☒ REVIEWED BYATTORNEY ☒ REVIEWED BY FINANCE ☐ RECOMMENDATION:
Approve the Quarterly Waivers Report for January 2025 through March 2025.
BACKGROUND:
Council approved the City Administrator to have the authority to waive penalties, interest, fees, liens, etc., up to $10,000. It was requested that a quarterly report be presented that summarized the transaction the City Administrator granted under this authority.
REASON FOR RECOMMENDATION:
This report is a summary of the waivers that were issued and is an element of transparency for the Council and the public. These waivers are issued on a case by case basis and will fluctuate from quarter to quarter.
This is a tool for the Council to evaluate the use and effectiveness of the program.
FISCAL IMPACT:
There was one waiver issued this quarter for a total of $395.00. Please see the attached spreadsheet for the detail.
ALTERNATIVES:
Pull the item for further discussion
ACTIONS FOLLOWING APPROVAL:
None
Date Entity/Person Address
Account or
Lien # Type Amount Justification
3/25/2025 Justin Lopes 8820 Laguna St N/A Park Reservation for Childrens Camp $ 395.00 $ 395.00
CITY COUNCIL REPORT ON WAIVERS PER RESOLUTION 83-19
QUARTER 1/1/2025 - 3/31/2025
TOTAL FEES WAIVED
130 S Second Street, Chowchilla, CA 93610
Telephone: (559) 665-8615 www.CityOfChowchilla.org
Item 3.7
CLICK HERE
TO RETURN TO
THE AGENDA
The Chowchilla Police Department management team’s salary adjustment resolution and salary scale will be available at the time of the meeting.
REPORT TO THE CITY COUNCIL
Item 4.1
CLICK HERE
TO RETURN TO
THE AGENDA
Meeting of: April 22, 2025
AGENDA SECTION: Public Hearing
SUBJECT: Consideration of Abatement Notice Objections or Protests from Affected Property Owners and a Council Resolution Authorizing the City Administrator to Execute Necessary Documents
PREPARED BY: Fred Gaumnitz, Fire Chief
ATTACHMENTS: Council Resolution Authorizing City Administrator and/or his Designee to Execute Appropriate Documents and Sample Weed Abatement Letter
REVIEWED BY
ADMINISTRATOR ☒ REVIEWED BYATTORNEY ☒ REVIEWED BY FINANCE ☐ RECOMMENDATION:
That the City Council hear any protests from affected property owners and authorize City Administrator and/or his designee to execute necessary documents.
BACKGROUND:
Whenever weeds grow upon the street or sidewalk or upon or in front of private property that is injurious to the public health, or is indecent or offensive to the senses, or endangers the public safety by creating a fire menace, or are otherwise noxious or dangerous, this public nuisance requires abatement, pursuant to Chowchilla Municipal Code Chapters 8.02, Property Maintenance and 8.12, Weeds.
With Council’s previous authorization by Resolution No. 17-25, the annual weed abatement program is being implemented in accordance with the process outlined in the Municipal Code. The purpose of this program is to identify the existence and abatement of this type of public nuisance.
REASON FOR RECOMMENDATION:
City Council authorized annual weed abatement program on March 25, 2025. Properties within the city limits were inspected during the first week of April and a Notice of Corrective Action was sent to owners of record on April 7, 2025 per the municipal code. A list of non-compliant properties was provided to the Fire Department to coordinate abatement with contractor.
FISCAL IMPACT:
Abatement of non-compliant properties will be selected by staff to a specific contractor. The total contract amount will be reduced based on property owner abatements prior to the contractor abating the properties.
It should be noted Any owner of property, upon which property a public nuisance has been declared to exist pursuant to Sections 8.12.010 through 8.12.040 who fails to abate such nuisance within ten days after the date of conclusion of the hearing with respect to such property, as provided in Section
8.12.040 shall be responsible for remitting the citation fee of $100.00 plus the bid amount for that property if contractor abates the property. Community Development staff anticipates the properties needing abatement by the City will reduce prior to arrival of City approved Contractor for abatement.
ALTERNATIVES:
Not perform annual weed abatement, notices and abatement of non-compliant properties.
ACTIONS FOLLOWING APPROVAL:
Consistent with past practices, the Finance Department will issue billings to these property owners. Should delinquency occur, a property lien will be filed.
COUNCIL RESOLUTION # XX-25
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHOWCHILLA, CALIFORNIA
RELATED TO HEARING PROTESTS OF ANY AFFECTED PROPERTY OWNERS AND
AUTHORIZING THE CITY ADMINSTRATOR TO EXECUTE NECESSARY DOCUMENTS
THERETO
(2025 WEED ABATEMENT PROGRAM)
WHEREAS, whenever weeds grow that are injurious to the public health, or is indecent or offensive to the senses, or endangers the public safety by creating a fire menace, or are otherwise noxious or dangerous, this public nuisance requires abatement; and WHEREAS, it is the desire of the City Council to effect timely removal of all weeds so described through the City’s Weed Abatement Program, and in manner provided by law; and WHEREAS, on March 25, 2025, the City Council authorized the annual weed abatement program with the passage of Resolution # 17-25; and
WHEREAS, a Notice of Correction was issued to non-conforming properties and if abatement does not occur during time frame prescribed, the City may choose to follow Chowchilla Municipal Code Chapter 8.02, Property Maintenance & Chapter 8.12; and WHEREAS, properties were notified by letters via mail per municipal code on April 7, 2025; and
WHEREAS, no property owner appealed the notice of violation of their property, pursuant to Chowchilla Municipal Code Section 8.02.070, Procedures for abatement of unlawful conditions; and
WHEREAS, the Code Enforcement Officer provided a list of non-compliant properties to the Fire Department to coordinate abatement with contractor; and WHEREAS, the Council heard this matter, received a staff report, received public testimony and deliberated on April 22, 2025.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chowchilla hereby finds, determines and declares the following:
1. The above recitals are true and correct;
2. Authorize the City Administrator and/or his designee to execute the appropriate documents associated with this action; and
3. This resolution is effective immediately upon adoption.
PASSED AND ADOPTED by the City Council of the City of Chowchilla this 22nd day of April, 2025 by the following vote to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
Mayor Kelly Smith
ATTEST:
Joann McClendon, CMC
City Clerk
REPORT TO THE CITY COUNCIL
Item 4.2
CLICK HERE
TO RETURN TO
THE AGENDA
Meeting of: April 22, 2025
AGENDA SECTION: Public Hearing
SUBJECT: Consideration and Adoption of a City Council Resolution Approving the Close Out of 2020 Community Development Block Grant Program – Coronavirus Response Round 1 (CDBG-CV1)
PREPARED BY: Janae Lacey, Community and Economic Development Specialist APPROVED BY: Jaime Quintana, Community & Economic Development Director ATTACHMENTS: 1. Resolution
2. Public Hearing Notice
3. CDBG-CV Small Business Loan Program Guidelines
REVIEWED BY
ADMINISTRATOR ☒ REVIEWED BYATTORNEY ☒ REVIEWED BY FINANCE ☐ RECOMMENDATION:
City staff recommends that the City Council of the City of Chowchilla:
• Receive the staff report and enter it in the record; and • Adopt the resolution approving and authorizing the CDBG-CV1 program closeout BACKGROUND:
The California Department of Housing and Community Development (Department) received funding from the United States Department of Housing and Urban Development (HUD) for the Community Development Block Grant (CDBG) Program and allocates funds to CDBG eligible non-entitlement jurisdictions.
Approximately $18.7 million in CDBG coronavirus response round 1 (CDBG-CV1) federal funds authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, were allocated to eligible jurisdictions to perform Activities related to COVID-19 response and recovery. The CARES Act provides extra CDBG funds specifically targeted to prevent, prepare for, and respond to coronavirus.
The CDBG-CV1 Notice of Funding Availability (NOFA) was published June 5, 2020, providing funding only for the following Activities:
• Assistance to businesses and microenterprises impacted by COVID-19 stay-at-home orders and shut-downs
• Public services related to COVID-19 support
• Facility improvements related to COVID-19 healthcare and homeless housing needs • Acquisition of real property to be used for the treatment or recovery of infectious diseases in response to COVID-19
Per the published NOFA from HCD, the City of Chowchilla received $92,456 in funding to be used for the activities listed above. The monies were designated towards “the Assistance to businesses and microenterprises impacted by COVID-19 stay-at-home orders and shut-downs” activity. Similar to the “Save our Community Businesses” Program the City created to assist eligible businesses within the community.
Resolution No. 59-20 was passed and adopted on July 14, 2020. The City was awarded $92,456.00 for business assistance and for administration. The grant supported the following business to cover payroll and equipment, with $50,000 for one full-time equivalent job created or retained:
• Lady G’s Soul Spot - $50,000.00
• Grant Administration - $7,812.87
FISCAL IMPACT:
There is no fiscal impact to the City of Chowchilla for the closeout of the grant program.
ALTERNATIVES:
1. Approve, subject to other than recommended by staff; or,
2. Deny; or,
3. Refer to City Staff for reconsideration of specific items to be addressed in City Council motion.
ACTIONS FOLLOWING APPROVAL:
City Administrator to execute and submit all required grant closeout materials to HCD.
COUNCIL RESOLUTION XX-25
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHOWCHILLA, CALIFORNIA APPROVING THE CLOSE OUT OF 2020 COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM – CORONAVIRUS RESPONSE ROUND 1 (CDBG-CV1)
WHEREAS, the City of Chowchilla received Community Development Block Grant (CDBG) funds for Economic Development in the amount of $92,456.00 from the CDBG-CV Grant 20-CDBGCV1-00094; and WHEREAS, the City of Chowchilla is required to comply with all state and federal public participation requirements in the closeout process;
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chowchilla hereby finds, determines and declares the following:
1. The City Council hereby approves to disencumber $34,643.13 in CDBG-CV funds from its grant programs.
2. The City Administrator is authorized to sign and act on the City's behalf in all matters relating to the 20-CDBG-CV1-00094 grant closeout.
PASSED AND ADOPTED by the City Council of the City of Chowchilla this 22nd day of April, 2025 by the following vote to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
Mayor Kelly Smith
ATTEST:
Joann McClendon, CMC
City Clerk
CITY OF CHOWCHILLA
PUBLIC HEARING NOTICE
NOTICE IS HEREBY GIVEN that the City of Chowchilla will conduct a public hearing on APRIL 22, 2025 at 7:00pm, at the Chowchilla City Council Chambers located at 130 South 2nd Street, Chowchilla, CA 93610, in order to discuss and solicit comments on the submittal of the Community Development Block Grant (CDBG) accomplishments and acceptance of the closeout report for the following grant activities:
CDBG Grant 20-CDBG-12078
Economic Development $500,000.00 Award
$499,641.29 Spent
$358.71 Disencumbering
CDBG-CV Grant 20-CDBG-CV1-00094
Economic Development $92,456.00 Award
$57,812.87 Spent
$34,643.13 Disencumbering
CDBG-CV Grant 20-CDBG-CV2-3-00037
Economic Development $336,439.00 Award
$137,126.98 Spent
$199,312.02 Disencumbering
The City will be required to disencumber $358.71 of CDBG and a total of $233,955.15 of CDBG-CV funds for Economic Development due to receiving additional CDBG funds that offered higher forgivable loans to qualifying businesses and businesses not meeting the criteria for CDBG-CV funding.
The purpose of this public hearing is to give citizens an opportunity to make their comments known regarding the accomplishments under the State administered CDBG Program. If you require special accommodations to participate in the public hearing, please contact Jaime Quintana, Community and Economic Development Director, City of Chowchilla, 130 South 2nd Street, Chowchilla, CA 93610, or you may telephone (559) 665-8615. In addition, the proposed plan is available for review at the above address between the hours of 8:00 a.m. and 5:00 p.m. on Monday – Friday.
If you are unable to attend the public hearing, you may direct written comments to the City of Chowchilla, 130 South 2nd Street, Chowchilla, CA 93610, or you may telephone Mark Jaime Quintana at (559) 665-8615. In addition, information is available for review at the above address between the hours of 8:00 a.m. and 5:00 p.m. Monday – Friday.
The City of Chowchilla promotes fair housing and makes all its programs available to low- and moderate-income families regardless of age, race, color, religion, sex, national origin, sexual preference, marital status, or handicap.
No. 8201 - April 12, 2025
1 COMMUNITY DEVELOPMENT BLOCK GRANT CORONAVIRUS AID
SMALL BUSINESS LOAN PROGRAM GUIDELINES
Awards will be based on eligibility and will be reviewed in order received SUMMARY:
Community Development Block Grant Coronavirus Aid (CDBG-CV) is a federally funded program.
CDBG-CV funds may be used to secure economic opportunities for low- and moderate-income persons. CDBG-CV funds are targeted to businesses of the City that have the highest adverse impact as a result of the Coronavirus.
PURPOSE:
The Chowchilla CDBG-CV Small Business Loan Program is designed to promote economic stability by providing immediate relief in the form of a one-time forgivable loan for essential operating expenses to Chowchilla small businesses negatively impacted by COVID-19.
The goals of this program are to:
• Help small businesses survive the COVID-19 crisis.
• Retain employment and continue to pay employees.
• Maintain the provision of goods and services for Chowchilla residents.
FUNDING:
The maximum CDBG-CV award will be a maximum of $50,000 upon approval and in compliance with CDBG-CV criteria.
ELIGIBILITY:
A business must meet ALL of the following criteria to be eligible to apply:
• The business must have experienced a negative impact due to COVID-19, by certifying that the business has experienced at least a 25% reduction in revenue and that proceeds will be used for allowable expenses under the State CDBG-CV Act guidelines. • Must be a private, for profit business. Independent Contractors who receive 1099tax forms are not eligible for this program.
• Businesses must obtain a Unique Entity Identifier (UEI) to be eligible to receive assistance under the City’s Small Business Loan Program. Business and/or any owner may not be suspended, debarred, proposed for debarment,declared ineligible, or voluntarily excluded from participation in federal transactions in the federal System for Award Management (SAM.gov) to received federal funding assistance.
• Businesses must have 25 or less full-time equivalent employees. • The business must have a physical storefront establishment within Chowchilla's city limits. • Businesses must have a current Chowchilla business license. 2 • No national chains. National chains are defined as franchises/for-profit corporations; except in the case where the franchisee or brand has a Chowchilla-basedowner. • Operating as a business a minimum of one year prior to date of application. • Business may NOT be delinquent in State and/or Federal licensing and filings.
If CDBG-CVfunds are awarded to a business, the business must meet the following requirements:
• Business will create/retain at least one full-time or full-time equivalent (40 hours/week) low- or moderate-income permanent job (LMI Job) within 12 months. Moderateincome means less than or equal to 80% of the Area Median Income(AMI). • If business is retaining LMI job(s), then business must demonstrate clear objective evidencethat permanent LMI job(s) would be lost without CDBG-CV assistance.
TERMS:
Loan will be forgiven if the business meets the required LMI job creation/retention after a one-year period.
ELIGIBLE USES (CDBG-CV funds can be used for):
• Rent/Mortgage in arrears plus one additional month
• Utilities in arrears
• Payroll
• Personal Protective Equipment, such as plastic gloves and face shields, disposable masks, and touchless hand sanitizer dispensers
INELIGIBLE USES (CDBG-CV funds cannot be used for):
• Loan Payments to Small Business Associations
• Governmental Uses or Expenses
• Political Activities
• Personal Property
• Savings
APPLICATION PROCESS:
Applicants must complete and submit a funding application to the City of Chowchilla. Applications will be reviewed in order of receipt. All required documents as noted in the section below MUST be submitted with completed application in order to be considered for CDBG-CV funding.
Applicants will be notified of their application’s approval or rejection and funding amount by City staff or consultant. Amount of funding awarded to a business will be based on need. Once program funding is exhausted, other qualified applicants will be placed on a waiting list when additional funds become available.
Procurement shall comply with Federal procurement regulations as found in 2CFR 200.318 – 200.326 CFR: 2 CFR 200.318 -- General procurement standards.
PROCUREMENT DOCUMENTATION:
• Pre-award independent cost estimate (must be performed prior to receiving bids or proposals)
3 • Documentation outlining the procurement method that is being followed (e.g., micropurchase, small purchase, sealed bid, competitive bid [e.g., RFP or RFQ], etc.) • Copy of the procurement documents, which must contain all applicable required components, such as:
o Scope of Work
o Experience requirements, which allow for fair and open competition o Scoring Criteria from Federal regulations and reference to federal funding source(s)
o Bonding and insurance requirements
o Process for utilizing local business and small, minority contractors o DUNS and sam.gov registration information
o Conflict of Interest
o Handling, opening, and reviewing bids (for sealed bid process only) o Environmental review record for procured goods or services o Documentation of award selection process
o Documentation of cost or price analysis
o Signed agreement with vendor
o Invoices and activity logs
o Contract modifications and updated cost or price analysis, as applicable o Chowchilla Business License
o Lease Agreement
o Payroll Information
o Financial Statement that includes: (a) Income Statement, (b) Balance Sheet, and (c) Statement of Cash Flows
o Most recent signed IRS Tax Return
o Documentation of previously received COVID-19 related federal funding and breakdown on how funds were spent
o An affidavit from the business that provides a narrative as to how the pandemic has now impacted the business and should include how the funds are going to directly prepare, prevent, and/or respond to COVID-19.
PROCUREMENT FILE MAINTENANCE:
The Procurement Checklist must be filled out for each procurement action taken by a subrecipient, according to the procurement methodology used for each solicitation. This checklist must be maintained for each procurement activity and within each procurement file. City of Chowilla staff or consultant will verify, through grant management or monitoring, whether the procurement checklist has been maintained for procurement actions taken by subrecipients. In addition to the procurement checklist, subrecipients will be required to provide the following key documents to assess compliance with procurement activities:
• Independent Cost Estimate
• RFP/RFQ as applicable
• Listing of Applications Received and summary of requested grant/loan funding amounts • Summary of Evaluations Performed and Application Scoring Checklist • Cost and Price / Funding Request Analysis
• Grantee approval of awarded funding
• Contract
4 Conflicts of Interest and governing the actions of its employees engaged in the selection, award, and administration of contracts.
No employee, officer, or agent may participate in the selection, award, or administration of a contract supported by a Federal award if he or she has a real or apparent conflict of interest. Such a conflict of interest would arise when the employee, officer, or agent, any member of his or her immediate family, his or her partner, or an organization which employs or is about to employ any of the parties indicated herein, has a financial or other interest in or a tangible personal benefit from a firm considered for a contract.
The officers, employees, and agents of the non-Federal entity may neither solicit nor accept gratuities, favors, or anything of monetary value from contractors or parties to subcontracts.
However, non-Federal entities may set standards for situations in which the financial interest is not substantial or the gift is an unsolicited item of nominal value. The standards of conduct must provide for disciplinary actions to be applied for violations of such standards by officers, employees, or agents of the non-Federal entity.
Procurement documentation shall be maintained containing the following elements:
• Pre-award independent cost estimate
• Documentation on procurement method
• Copies of procurement documents
RESTRICTIONS ON DUPLICATION OF BENEFITS:
CDBG funds may not be used to supplant or duplicate private, federal, State, or local government funding.
The Applicant must disclose any funds received in response to the COVID-19 pandemic from private sources, and from any federal, State, or local government programs. Acceptance of other funding will not disqualify an applicant from the Program but may affect the amount of funds available or eligible costs. Applicants will provide personal and business bank statements. The City will review the statements to identify any unreported influx of cash.
If a Borrower receives funds from any source for the same costs that are funded under this Program, the Borrower must repay the duplicative funding. Either the CDBG business loan or the other funding source may be repaid. Other sources may include, but not are not limited to:
• Private sources including bank loans (not including documented loan from a relative); • Small Business Administration (SBA) Paycheck Protection Program (PPP), Economic Injury Disaster Loan Program (EIDL) or Economic Adjustment Assistance Program (EAA); • State of California iBank Small Business Disaster Relief Loan Guarantee Program; • State of California Pandemic Unemployment Assistance; or • Any other federal, State, or local government program providing funding for items noted as eligible costs for this Program.
DUPLICATION OF BENEFITS:
All businesses are required to complete a Duplication of Benefits (DOB) Affidavit as part of the application process. This affidavit acknowledges the City’s requirement that any person or entity 5 receiving CDBG-CV assistance must agree to repay assistance that is determined to be duplicative.
To meet HUD’s requirements, the City has developed a method of assessing whether the use of CDBG-CV funds will duplicate financial assistance that is already received or is likely to be received by acting reasonably in evaluating need and the resources available to meet that need.
This assessment process is as follows:
1. Upon receipt of the completed application packet to the Program, the City of Chowchilla and Consultant will review the Duplication of Benefits Affidavit to determine if the applicant has reported receiving any potentially duplicative assistance.
2. If so, the City or Consultant will request additional information from the applicant, including:
a. Dates funds were received
b. Specific uses of funds received, including receipts and dates as appropriate.
3. Based on a review of this information, the City or Consultant may:
a. Determine that there is no duplication and proceed with consideration of the application for the full amount requested.
b. Determine that there is a partial duplication and proceed with consideration of the application for an amount that reduces the request by the Duplication of Benefits (“DOB”) amount:
i. (Amount Requested) – (Amount of DOB) = Eligible Amount c. Determine that there is a complete duplication and deny the application.
4. In the event that an application moves forward and is approved, in whole or in part, the applicant will be required to sign a Subrogation Agreement to address concerns around the potential for future duplication (for example a Paycheck Protection Program application was made and was not denied but the applicant has not heard back).
5. In the event that an application is approved in part, the City will also include in the funding documents specific information around what the funds may be spent on so as to avoid duplication of benefits.
6. The City or Consultant will require all successful applicants to provide documentation as to how funds are actually expended and will review this documentation to ensure no duplication has taken place.
All application documents, including the Affidavit and Subrogation Agreement, shall be retained in compliance with HUD’s record retention requirements.
REVIEW PROCESS:
The following priorities will be considered when awarding funds:
• The business provides jobs to low- to moderate-income individuals. • The number of jobs that the business sustains during a normal business cycle. • The business demonstrates that it has lost a significant share (25% or more) of revenue due to the COVID-19 pandemic.
• The business demonstrates a strong chance of remaining open post COVID-19. 6 • The business has operated consistently a minimum of one year prior to date of application.
• Priority will be given to businesses located within low/moderate census tracts as defined by HUD.
• All eligibility criteria has been met.
DOCUMENTATION:
Each beneficiary or project file will contain the following:
1. Duplication of Benefit Calculation Worksheet form to include:
a. Identification of unmet need
b. Identification of all sources of assistance provided to applicant c. Identification of those sources that are duplicative (with comments as needed) d. Final award calculation
2. Any required third party verifications of assistance and/or certifications as follows:
a. FEMA programs: letter/s from FEMA and/or data provided by FEMA b. Insurance: letter from insurance company and/or data if available c. SBA: letter/s from SBA and/or data provided by SBA
d. Other program documentation
3. Certification that no additional benefits have been received. This can be a signed affidavit from the beneficiary or other form as created by the program.
4. A signed subrogation agreement from the recipient
Note: Items 3. and 4. can be on the same form.
For businesses opening after March 27, 2020, COVID 19 impact must be demonstrated by evidence of one of the following:
• Ordered to close from either a state or local government (proof must be submitted) • Had to lay off at least one full time or part time employee due to circumstances created by the pandemic (proof must be submitted along with a written affidavit) • Show loss of income via business annual gross revenue as reported on their tax returns.
Comparison tax returns 2019/2020 or 2020/2021.
MONITORING:
The applicant is responsible for providing the Program with documentation demonstrating that grant funds were used in the way they were intended.
The City will review the business’ application to identify how the business said they would use funds and will collect supporting documents. If a business finds it necessary to change their intended use of the funds, they must seek approval from the City in writing before making any changes and submit an updated itemized lists of business expenses.
Although this list is not intended to be exhaustive, supporting documents may include:
7 • Lease agreement and rent receipts
• Invoices with receipts/proof of payment
• Payroll documents
All collected documents will be placed in a business’s program file.
Policies and Procedures shall be reviewed on an annual basis.
Complete applications and any questions should be submitted via email to:
Michael Baker International
Attention: Rebecca Winnie, City Consultant
[email protected]
8 APPENDIX A
LOAN UNDERWRITING CRITERIA SUMMARY
A.1 ELIGIBLE LOAN APPLICANTS
Eligible Economic Development Loan Program (EDLP) Forgivable Loan applicants, here after called “Borrower Eligible for Loan Forgiveness” must meet the criteria outlined below and as amended by U.S. Department of Housing and Urban Development (HUD) and the California Housing and Community Development Department (HCD):
• Be an existing business with no more than 100 full-time equivalent (FTE) employees a minimum of one year prior to the date of application submittal and in financial distress as a result of the COVID 19 pandemic or other presidentially declared disaster (“disaster”) that has resulted in (or will result in) the loss of jobs, 51% are held by LMI individuals as a result of the COVID crisis.
• Is shown to have been financially viable a minimum of one year prior to the date of application submittal. Financial viability may be demonstrated by one or more of the following:
o A profit and loss statement (including income from operations, other income, cost of goods sold, operating expenses, taxes and fees, short-term debt service) showing profitable operations, (non-cash expenses such as depreciation, major capital investments and amortization of capital may be excluded). o A cash flow forecast showing the expected potential for positive net income in subsequent periods demonstrated by accounts receivable, backlog, opening of new markets and expansion of customer base.
o A business plan that supports good prospects for viability going forward. • Be in operation a minimum of one year prior to the date of application submittal and be able to provide the prior year’s federal business tax return (with all schedules) or appropriate federal personal tax returns with appropriate business-related schedules and forms (e.g., Schedules C, D, E, SE, 1, 1099’s, etc.).
• Be an existing business with a previous history of creditworthiness that is 51% or more owned and operated by a U.S. Citizen(s) or permanent legal resident(s) • The creditworthiness determination will also include an assessment of the previous creditworthiness of any owners with a 20% or greater ownership interest. • Be able to provide Year-to-Date (YTD) financial statements a minimum of one year prior to the date of application submittal including (P&L statement, A/P Aging Report, A/R Aging Report, Debt Schedule).
• Have or developed the capacity to generate monthly financial statements (i.e., P&L Statement, A/P Aging Report, A/R Aging Report, Debt Schedule) following receipt of the loan.
• The business must be established to operate legally in the State of California [e.g., registration with the CA Secretary of State and/or Madera County as a “Doing Business As” (DBA) Fictitious Business Names Statement (FBNS)] with a valid City of Chowchilla Business License (if applicable). A FBNS will be required for all businesses. • The business must have:
o Required local, state, and federal permits.
o Proper insurance for current and proposed business activities. o Be operating out of a location with zoning that allows for current and proposed business activities.
o An existing commercial lease with renewal options that extend, at a minimum, to the month and year designated as the final month and year of the loan agreement. A home-based business must have a comparable mortgage, lease or rental agreement that extends, at a minimum, to the same period required for a commercial lease. 9 o NOTE: If a Borrower is an existing business relocating to the City of Chowchilla or is a new startup business and does not have proper permits, licenses, leases, or insurance at the time of application, then these items can be made a condition of funding the loan.
A.2 INELIGIBLE LOAN APPLICANTS
Ineligible EDLP Loan applicants include those businesses for which any of the following are true:
• The resulting EDLP Loan will result in a “duplication” of funding from other disaster related funding programs (e.g., SBA PPP, SBA EIDL, insurance reimbursement, local/regional funding/grant programs) that will be used for the same expense. • The business and underwriter cannot establish a clear nexus between the financial impacts of the disaster and the need for EDLP funding.
• The business and/or business owners with a 20% business ownership interest have liens or pending lawsuits that may have an adverse impact on the financial viability of the business.
• The business’s physical place of business is located outside of the jurisdictional boundaries of the City of Chowchilla.
• The business’s physical place of business is located on tribal lands. • The business or any one of its principals is on the Federal debarred list. • The business or any of its principals have defaulted on any Federal debt. • The business or any of its principals have a relationship with the Lender that violates CDBG Conflict of Interest guidelines.
• The business’ goods or services involve the distribution, sale or use of cannabis or products containing cannabis or cannabis derivatives.
• The business is involved in a business activity prohibited by CDBG regulations (e.g., private golf club).
A.3 ELIGIBLE USES OF FUNDS FOR LOANS WITH FORGIVABLE LOAN TERMS The uses of EDLP funds for loans with forgivable loan terms are restricted to eligible uses as approved by HUD and HCD CDBG Program Guidelines.
Loan proceeds may be used to cover the following eligible costs:
• Operating Expenses (OE) and Working Capital (W/C) as defined below:
o OE includes primary expenses including, but not limited to, payroll, insurance, lease payments and utilities.
o W/C is any additional capital needs (e.g., inventory) with the amount to be net of OE. o The amount of OE and W/C needs presented in financial and cash flow statements must reflect amounts per month that are supported by pre-disaster financial information (e.g., monthly financial statements or Year End business tax returns). • Purchase of furniture, fixtures, and equipment (FF&E) to support the business’ needs to re-open and/or operate as a result of the disaster. FF&E purchases that will trigger Federal or State prevailing wage requirements will be considered on a case-by-case basis. • Refinancing of some forms of existing short-term debt when the refinancing complies with HUD and HCD CDBG underwriting guidelines, is done in conjunction with financing other eligible costs and contributes to the business’ ability to sustain operations and retain the required number of CDBG eligible jobs. NOTE: Examples of short-term debt that may be refinanced could include high interest credit cards or short-term loans from on-line lenders where the business can provide supporting documentation that clearly demonstrates that funds were used for eligible business purchases and expenses). 10 • Loan funds will be disbursed as per the terms outlined in section B.8 A.4 LOAN REQUIREMENTS – CDBG NATIONAL OBJECTIVES INCLUDING
APPROVED WAIVERS
Borrowers that are eligible for HUD and HCD approved waivers must comply with CDBG National Objectives in accordance with the guidelines presented in Appendix M of the NOFA and any supplemental written guidance provided by HCD.
A.5 LOAN REQUIREMENTS – CDBG AND EDLP UNDERWRITING CRITERIA FOR
LOANS WITH FORGIVENESS TERMS
A.5.1 CDBG Underwriting Criteria
Eligible EDLP applicants for loans with forgiveness terms are underwritten in accordance with the following CDBG underwriting criteria.
• Project costs are reasonable as evidenced by 3rd party cost estimates (e.g., vendor quotes, copy of online search, etc.).
• All project costs are eligible per federal regulations and HCD guidelines. • All sources of project financing are committed to support the financial projections that demonstrate that, with EDLP funds, the business is likely to continue operations and retain (or re-create) the projected number of jobs (51% of which are filled by LMI individuals or, if lost due to normal turnover, will be may available to LMI individuals). This may include:
o Borrower or other private funds (proof of funds availability such as bank statements and a signed letter indicating that the funds will be contributed to the project are required).
o A detailed letter of interest from a financial institution outlining the loan amount, loan term, interest rate, collateral requirements, loan-to-value ratio, debt service coverage ratio (DSCR), etc. will be required for the underwriting process. o An approval letter from another government, nonprofit or other business or infrastructure financing program.
• To the extent practicable, EDLP funds are not substituted for non-Federal financial support. This will include an assessment to ensure no duplication of funds from other federal, state, or private sources that may have been provided to assist the business in response to a disaster, economic downtown or other event. • The project is financially feasible based on the underwriter’s assessment of the items defined below:
o The management team has the capacity to execute the business plan and meet the financial projections (i.e., sales revenues, COGS, operating expenses, and profitability).
o The historic creditworthiness of owners with a 20% or greater interest or any member of the management team with check writing authority.
• The financial operating and cash flow projections:
o Are in line with the business’ previous seasonal fluctuations in financial performance and/or reflect anticipated conditions that may impact Revenues, COGS (if applicable), Operating Expenses and Profitability during the term of the EDLP. o Show an ability for the business to reach a level of financial breakeven with EDLP and other funding during the term of the EDLP.
NOTE: A formal, signed commitment letter from the financial institution with the same loan amount, loan terms, interest rate, collateral requirements, loan-to-value ratio, DSCR, etc. will be required before EDLP funds will be released.
11 o Clearly demonstrate that the Borrower will generate sufficient income to retain (or recreate) the projected number of jobs within an agreed upon term established between the Borrower, the Administrator, and the Lender.
o Demonstrate that the business will meet the (DSCR) required by other lenders. o Demonstrate that the business will generate sufficient revenue to provide the salaries, wages or draws needed by the owner(s) to cover their personal expenses taking into consideration other sources of income available to meet owners’ personal financial needs.
• As EDLP loans with forgiveness terms will be limited to businesses that have faced financial conditions that resulted in the loss of jobs or are in imminent danger of facing financial conditions that will result in the loss of jobs, underwriting will not include 1) an assessment of the return on owner’s equity invested in the project, nor 2) an assessment of the disbursement of EDLP funds on a pro-rata basis with other project financing.
The EDLP underwriting process for loans with forgiveness terms will require documentation to assess the ability of the business to sustain operations (e.g., documentation on other debt, historic business financial statements and tax returns for 2019, historic personal financial statements and tax returns for 2019, personal credit reports, financial projections and DSCR).
The EDLP underwriting process for loans with forgiveness terms will require documentation to assess the ability of the business to sustain operations (e.g., documentation on other debt, historic business financial statements and tax returns for a minimum of one year prior to the date of application, historic personal financial statements and tax returns for the year prior to the date of application, personal credit reports, financial projections and DSCR). However, the following additional (or more detailed) information may, at the underwriter’s discretion, be required due to the CBDG underwriting criteria outlined above and the willingness of the City of Chowchilla to consider higher risks loans in exchange for the project the CDBG National Objective and Public Benefit requirements outlined above.
• A detailed breakdown in the financial statements with line items showing:
o Salaries/wage, employment taxes and benefit expenses for existing employees with a breakdown for those employees that will be retained with the assistance from the EDLP loan and should align with the Job Tracking Form submitted with the Borrower’s application.
o A history of the business and brief bios of each of the key members of the management (e.g., CEO, CFO, CTO, etc.) and operating team (e.g., Production Manager, Sales Manager, etc.).
o A summary of the market(s) served and any adjustments to accommodate for disaster related impacts.
o A schedule of owner’s equity invested in the businesses and any new debt incurred prior to one year from the date of application (the debt summary should include the name of the source, the amount borrowed, loan terms, interest rate, current balance, etc.).
o A timeline outlining when funds from each source of financing will be expended (including EDLP and non-EDLP sources).
A.5.2 EDLP UNDERWRITING CRITERIA FOR LOANS WITH FORGIVENESS TERMS Eligible EDLP applicants for loans with forgiveness are underwritten in accordance with the following EDLP underwriting criteria.
• Business is located within the jurisdictional boundaries of the City of Chowchilla. • Financial Ratios:
12 o DSCR – an aggregate business DSCR of no lower than 1.0 (includes an aggregate of the DSCR for all non- EDLP debt financing).
o Global Cash Flows – an aggregate of business DSCR and personal cash needs are sufficient to cover personal operating expenses including a personal DSCR of no lower than 1.0.
o Net Income (after taxes and interest) sufficient to meet DSCR requirements outlined above.
• The Administrator will work closely with the eligible businesses to ensure they understand the requirements of the EDLP and the benefits of participating.
A.6 DETERMINATION OF LOAN AMOUNTS
EDLP loan with forgiveness terms will comply with HUD and/or HCD regulations and guidelines as outlined in NOFA Appendix M and other written documentation provided by HUD and/or the HCD.
A.7 DETERMINATION OF LOAN TERM
EDLP loan with forgiveness terms will comply with HUD and/or HCD regulations and guidelines as outlined in NOFA Appendix M and other written documentation provided by HUD and/or the HCD.
A.8 DETERMINATION OF LOAN INTEREST RATE
EDLP loan with forgiveness terms will comply with HUD and/or HCD regulations and guidelines as outlined in NOFA Appendix M and other written documentation provided by HUD and/or the HCD. It is anticipated that loans with forgiveness terms will be zero percent (0%) for the specified term of the loan unless otherwise specified by the HCD.
A.9 LOAN DISBURSEMENT – LOANS WITH FORGIVENESS TERMS
Loan disbursement for loans with forgiveness terms will be in accordance with HUD and HCD regulations, guidelines, or other written procedures.
Disbursement of loan proceeds will take place only after all conditions have been met and loan documents executed. The procedure for loan disbursement will vary depending upon the purpose of the loan funding as outlined below:
• Operating Expenses and Working Capital – to be disbursed at 50% upon execution of the Promissory Note and 50% after six months in an amount that aligns with the cash flow needs as presented in the pro forma financials provided by the Borrower during the application process and updated as necessary prior to loan closing or due to changing operating conditions following loan closing.
• Furniture, Fixtures & Equipment – to be paid directly to the vendor upon receipt of a valid invoice or to be paid to the borrower upon receipt of a valid invoice and proof of payment (e.g., cancelled check or paid credit card bill)
The Administrator will approve all disbursements and evaluate the sustained viability of the business prior to disbursing future monthly Operating Expense and/or Working Capital advances.
A.10 LOAN MONITORING AND COMPLIANCE FILES – LOANS WITH FORGIVENESS TERMS
Following closing, monitoring files will be set up. Two separate physical and/or electronic loan files shall be maintained. The first is the legal file which holds all the original executed loan documentation. This electronic and/or physical file shall be kept in Lender’s or Administrator’s 13 fireproof vault or cloud-based backup for safekeeping. At a minimum the legal file shall include (if applicable):
• Promissory Note
• Loan Agreement with required CDBG language
• Deed of Trust
• General Security Agreement
• Personal Guaranty
• Corporate Guaranty
• Subordinate Agreement
• Life Insurance Policy and Agreement
• Hazard Insurance Policy and Agreement
• General Resolution
• Certificate of Secretary
• Opinion of Counsel
• Inter-creditor Agreement
• Documentation of Site Control (i.e., lease, deed of trust, etc.) The second is a credit file which will contain the day-to-day administrative records of the loan.
The credit file will include, at a minimum, the loan application and financial information associated with the application, loan memorandum, Lender LAC recommendation, disbursement records, reports of site visits, updated financial information provided by the Borrower, CDBG compliance data and other routine information related to the loan.
Application information should include the following as appropriate:
• Loan Disbursement Schedule
• Map verifying borrower is physically located within program boundaries • Documentation of compliance with federal acquisition requirements, if appropriate (e.g., land purchase)
• Documentation of compliance with federal debarred requirements • Copy of CDBG NEPA documents including Authorization to Use Grant Funds, if required (Original to be maintained in Lender’s Environmental Review Records file) • Copy of Documentation to determine Cost Reasonableness • Documentation to support National Objective/Public Benefit requirements for job retention that shows clear and objective evidence that jobs will be lost without CDBG assistance. • Signed CDBG Documents:
o Loan Certification Form
o Job Tracking Form (demonstrating CDBG compliance with LMI job creation/retention) o No Conflict-of-Interest Certification
o No Job Anti-Pirating Certification
o Income Certification forms (including Part 5 if required or other required income certification documentation)
A.11 LOAN SERVICING – LOANS WITH FORGIVENESS TERMS
A.11.1 Loan Servicing Agent
Loan servicing will be conducted by the Administrator with the Lender. 14 A.11.3 Loan Servicing And Document Collections Procedures Once the loan is closed, the Borrower is entered into a forgivable loan servicing system. EDLP loan with forgiveness terms will be serviced as follows:
• Administrator to secure evidence of purchase and payment for FF&E purchased with EDLP funds for review and comparison to loan application documents and budgets to validate cost reasonableness and CDBG compliance (e.g., NEPA, Prevailing Wage, etc.).
If in noncompliance, Administrator and Lender will determine if corrective action is required and implement corrective action if necessary.
• Borrower to provide the following to the Administrator for review by the 15th of the month following the close of the previous month:
o P&L and Balance Sheet or a P&L, A/P Aging and A/R Aging statements. o An updated Debt Schedule.
o Payroll records.
Once the loan is closed, the Administrator will monitor the loan to maintain the loan records in compliance with the Program objectives and CDBG guidelines. A servicing and documentation system will be maintained with a file for each borrower.
APPENDIX B
Chronology of Updates to City of Chowchilla CV1 and CV2-3 Small Business Loan Program (SBLP) Guidelines
VERSION NO. APPROVAL DATE AMENDMENT
1.0 09/14/2021 Original SBLP Guidelines approved by City Council
2.0 11/17/2022 Updated SBLP Guidelines approved by City Council:
• Increased award amount from $10,000 to
$50,000 under Funding section
• Removed requirement that applicant to have
been in business since March 1, 2019 to a
minimum one year prior to date of application
under Eligibility and Review Process sections
• Added UEI/SAM.gov registration requirement to
Eligibility and Required Documents sections
• Updated moderate income level from 120% to
80% under Eligibility section
• Added Restriction on Duplication of Benefits
section
3.0 07/11/2023 Updated SBLP Guidelines approved by City Council:
• Added verbiage regarding compliance with
procurement regulations in 2 CFR 200.318 -
200.326 when procuring goods or services
• Specified how procurement documentation files
are maintained, including:
o Pre-award independent cost estimate
o Documentation on procurement method
o Copies of procurement documents
• Specified Program Guidelines revision and
approval and dates
• Specified how guidelines are consistently
applied across all awards
• Specified process of checking and verifying to
avoid duplication of benefits
• Included chronology of approvals
REPORT TO THE CITY COUNCIL
Item 4.3
CLICK HERE
TO RETURN TO
THE AGENDA
Meeting of: April 22, 2025
AGENDA SECTION: Public Hearing
SUBJECT: Consideration and Adoption of a City Council Resolution Approving the Close Out of 2020 Community Development Block Grant Program – Coronavirus Response Round 2 and 3 (CDBG-CV2-3) PREPARED BY: Janae Lacey, Community and Economic Development Specialist APPROVED BY: Jaime Quintana, Community & Economic Development Director ATTACHMENTS: 1. Resolution
2. Public Hearing Notice
3. CDBG-CV Small Business Loan Program Guidelines
REVIEWED BY
ADMINISTRATOR ☒ REVIEWED BYATTORNEY ☒ REVIEWED BY FINANCE ☐ RECOMMENDATION:
Staff recommends the City Council to approve the following:
City staff recommends that the City Council of the City of Chowchilla:
• Receive the staff report and enter it in the record; and • Adopt a resolution approving and authorizing the CDBG-CV2-3 program closeout BACKGROUND:
The California Department of Housing and Community Development (Department) receives funding from the United States Department of Housing and Urban Development (HUD) for the Community Development Block Grant (CDBG) Program and allocates funds to CDBG eligible non-entitlement jurisdictions. Approximately $77.1 million in CDBG Coronavirus Response Rounds 2 and 3 (CDBG-CV2 and CV-3) federal funds authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, were allocated to eligible jurisdictions to perform activities related to COVID-19 response and recovery.
This amount included $5.9 million of unclaimed funds from tranche one (CV1), plus $54.4 million of new funds from tranche two (CV2) and $16.8 million from tranche three (CV3) of additional federal funds for the Community Development Block Grant- Coronavirus Relief (CDBG-CV) available for local assistance.
The $77.1 million in CDBG Coronavirus Response Rounds 2 and 3 (CDBG-CV2 and CV-3) was published in a “Notice of Funding Availability” (NOFA) on December 18, 2020. Entitlement and Non-entitlement local governments were eligible for a predefined formula allocation as defined in the December 2020 NOFA. The City of Chowchilla’s allocation for both CDBG-CV2 and CV-3 is set at $336,439 based upon HUD’s 2020 Low-Mod Percentages.
Eligible Activities Under the above Allocation in the December 2020 NOFA consisted of the following:
A. Community Development:
• Public services to respond to COVID-19 impacts
• Public facility improvements to increase capacity for healthcare facilities (facility improvements must include a documented connection with healthcare facility needs) • Public facility acquisition, provided that the end use increases healthcare facility capacity • Acquisition and/or improvement of housing facilities for persons experiencing homelessness B. Economic Development with a focus on job retention:
• Business assistance
• Microenterprise assistance (including Micro-financial assistance and Technical assistance) The City of Chowchilla previously applied to HCD and was successfully awarded the pre-awarded allocation of $92,456 in November 2020. Per the December 2020 NOFA, the City of Chowchilla was eligible to apply for a total of three activities listed above. The City applied the funding and focused the $336,439 towards the two Economic Development activities and related administrative expenses for the following:
• Business assistance
• Microenterprise assistance (including Micro-financial assistance and Technical assistance) Resolution No. 72-21 was passed and adopted on September 14, 2021. The grant supported the following business to cover payroll and equipment for one full-time equivalent job created or retained:
• The Shirt Shak - $52,500.00
• Flightcraft Boats - $50,000.00
• Grant Administration - $34,626.98
FISCAL IMPACT:
There is no fiscal impact to the City of Chowchilla for the closeout of the grant program.
ACTIONS FOLLOWING DECISION:
City Administrator to execute and submit all required grant closeout materials to HCD.
COUNCIL RESOLUTION #XX-25
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHOWCHILLA, CALIFORNIA APPROVING THE CLOSE OUT OF 2020 COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM – CORONAVIRUS RESPONSE ROUNDS 2 and 3 (CDBG-CV2-3) WHEREAS, the City of Chowchilla received Community Development Block Grant (CDBG) funds for Economic Development in the amount of $336,439.00 from the CDBG-CV Grant 20- CDBG-CV2-3-00037; and
WHEREAS, the City of Chowchilla is required to comply with all state and federal public participation requirements in the closeout process;
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chowchilla hereby finds, determines and declares the following:
1. The City Council hereby approves to disencumber $199,312.02 in CDBG-CV funds from its grant programs.
2. The City Administrator is authorized to sign and act on the City's behalf in all matters relating to the 20-CDBG-CV2-3-00037 grant closeout.
PASSED AND ADOPTED by the City Council of the City of Chowchilla this 22nd day of April, 2025 by the following vote to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
Mayor Kelly Smith
ATTEST:
Joann McClendon, CMC
City Clerk
CITY OF CHOWCHILLA
PUBLIC HEARING NOTICE
NOTICE IS HEREBY GIVEN that the City of Chowchilla will conduct a public hearing on APRIL 22, 2025 at 7:00pm, at the Chowchilla City Council Chambers located at 130 South 2nd Street, Chowchilla, CA 93610, in order to discuss and solicit comments on the submittal of the Community Development Block Grant (CDBG) accomplishments and acceptance of the closeout report for the following grant activities:
CDBG Grant 20-CDBG-12078
Economic Development $500,000.00 Award
$499,641.29 Spent
$358.71 Disencumbering
CDBG-CV Grant 20-CDBG-CV1-00094
Economic Development $92,456.00 Award
$57,812.87 Spent
$34,643.13 Disencumbering
CDBG-CV Grant 20-CDBG-CV2-3-00037
Economic Development $336,439.00 Award
$137,126.98 Spent
$199,312.02 Disencumbering
The City will be required to disencumber $358.71 of CDBG and a total of $233,955.15 of CDBG-CV funds for Economic Development due to receiving additional CDBG funds that offered higher forgivable loans to qualifying businesses and businesses not meeting the criteria for CDBG-CV funding.
The purpose of this public hearing is to give citizens an opportunity to make their comments known regarding the accomplishments under the State administered CDBG Program. If you require special accommodations to participate in the public hearing, please contact Jaime Quintana, Community and Economic Development Director, City of Chowchilla, 130 South 2nd Street, Chowchilla, CA 93610, or you may telephone (559) 665-8615. In addition, the proposed plan is available for review at the above address between the hours of 8:00 a.m. and 5:00 p.m. on Monday – Friday.
If you are unable to attend the public hearing, you may direct written comments to the City of Chowchilla, 130 South 2nd Street, Chowchilla, CA 93610, or you may telephone Mark Jaime Quintana at (559) 665-8615. In addition, information is available for review at the above address between the hours of 8:00 a.m. and 5:00 p.m. Monday – Friday.
The City of Chowchilla promotes fair housing and makes all its programs available to low- and moderate-income families regardless of age, race, color, religion, sex, national origin, sexual preference, marital status, or handicap.
No. 8201 - April 12, 2025
1 COMMUNITY DEVELOPMENT BLOCK GRANT CORONAVIRUS AID
SMALL BUSINESS LOAN PROGRAM GUIDELINES
Awards will be based on eligibility and will be reviewed in order received SUMMARY:
Community Development Block Grant Coronavirus Aid (CDBG-CV) is a federally funded program.
CDBG-CV funds may be used to secure economic opportunities for low- and moderate-income persons. CDBG-CV funds are targeted to businesses of the City that have the highest adverse impact as a result of the Coronavirus.
PURPOSE:
The Chowchilla CDBG-CV Small Business Loan Program is designed to promote economic stability by providing immediate relief in the form of a one-time forgivable loan for essential operating expenses to Chowchilla small businesses negatively impacted by COVID-19.
The goals of this program are to:
• Help small businesses survive the COVID-19 crisis.
• Retain employment and continue to pay employees.
• Maintain the provision of goods and services for Chowchilla residents.
FUNDING:
The maximum CDBG-CV award will be a maximum of $50,000 upon approval and in compliance with CDBG-CV criteria.
ELIGIBILITY:
A business must meet ALL of the following criteria to be eligible to apply:
• The business must have experienced a negative impact due to COVID-19, by certifying that the business has experienced at least a 25% reduction in revenue and that proceeds will be used for allowable expenses under the State CDBG-CV Act guidelines. • Must be a private, for profit business. Independent Contractors who receive 1099tax forms are not eligible for this program.
• Businesses must obtain a Unique Entity Identifier (UEI) to be eligible to receive assistance under the City’s Small Business Loan Program. Business and/or any owner may not be suspended, debarred, proposed for debarment,declared ineligible, or voluntarily excluded from participation in federal transactions in the federal System for Award Management (SAM.gov) to received federal funding assistance.
• Businesses must have 25 or less full-time equivalent employees. • The business must have a physical storefront establishment within Chowchilla's city limits. • Businesses must have a current Chowchilla business license. 2 • No national chains. National chains are defined as franchises/for-profit corporations; except in the case where the franchisee or brand has a Chowchilla-basedowner. • Operating as a business a minimum of one year prior to date of application. • Business may NOT be delinquent in State and/or Federal licensing and filings.
If CDBG-CVfunds are awarded to a business, the business must meet the following requirements:
• Business will create/retain at least one full-time or full-time equivalent (40 hours/week) low- or moderate-income permanent job (LMI Job) within 12 months. Moderateincome means less than or equal to 80% of the Area Median Income(AMI). • If business is retaining LMI job(s), then business must demonstrate clear objective evidencethat permanent LMI job(s) would be lost without CDBG-CV assistance.
TERMS:
Loan will be forgiven if the business meets the required LMI job creation/retention after a one-year period.
ELIGIBLE USES (CDBG-CV funds can be used for):
• Rent/Mortgage in arrears plus one additional month
• Utilities in arrears
• Payroll
• Personal Protective Equipment, such as plastic gloves and face shields, disposable masks, and touchless hand sanitizer dispensers
INELIGIBLE USES (CDBG-CV funds cannot be used for):
• Loan Payments to Small Business Associations
• Governmental Uses or Expenses
• Political Activities
• Personal Property
• Savings
APPLICATION PROCESS:
Applicants must complete and submit a funding application to the City of Chowchilla. Applications will be reviewed in order of receipt. All required documents as noted in the section below MUST be submitted with completed application in order to be considered for CDBG-CV funding.
Applicants will be notified of their application’s approval or rejection and funding amount by City staff or consultant. Amount of funding awarded to a business will be based on need. Once program funding is exhausted, other qualified applicants will be placed on a waiting list when additional funds become available.
Procurement shall comply with Federal procurement regulations as found in 2CFR 200.318 – 200.326 CFR: 2 CFR 200.318 -- General procurement standards.
PROCUREMENT DOCUMENTATION:
• Pre-award independent cost estimate (must be performed prior to receiving bids or proposals)
3 • Documentation outlining the procurement method that is being followed (e.g., micropurchase, small purchase, sealed bid, competitive bid [e.g., RFP or RFQ], etc.) • Copy of the procurement documents, which must contain all applicable required components, such as:
o Scope of Work
o Experience requirements, which allow for fair and open competition o Scoring Criteria from Federal regulations and reference to federal funding source(s)
o Bonding and insurance requirements
o Process for utilizing local business and small, minority contractors o DUNS and sam.gov registration information
o Conflict of Interest
o Handling, opening, and reviewing bids (for sealed bid process only) o Environmental review record for procured goods or services o Documentation of award selection process
o Documentation of cost or price analysis
o Signed agreement with vendor
o Invoices and activity logs
o Contract modifications and updated cost or price analysis, as applicable o Chowchilla Business License
o Lease Agreement
o Payroll Information
o Financial Statement that includes: (a) Income Statement, (b) Balance Sheet, and (c) Statement of Cash Flows
o Most recent signed IRS Tax Return
o Documentation of previously received COVID-19 related federal funding and breakdown on how funds were spent
o An affidavit from the business that provides a narrative as to how the pandemic has now impacted the business and should include how the funds are going to directly prepare, prevent, and/or respond to COVID-19.
PROCUREMENT FILE MAINTENANCE:
The Procurement Checklist must be filled out for each procurement action taken by a subrecipient, according to the procurement methodology used for each solicitation. This checklist must be maintained for each procurement activity and within each procurement file. City of Chowilla staff or consultant will verify, through grant management or monitoring, whether the procurement checklist has been maintained for procurement actions taken by subrecipients. In addition to the procurement checklist, subrecipients will be required to provide the following key documents to assess compliance with procurement activities:
• Independent Cost Estimate
• RFP/RFQ as applicable
• Listing of Applications Received and summary of requested grant/loan funding amounts • Summary of Evaluations Performed and Application Scoring Checklist • Cost and Price / Funding Request Analysis
• Grantee approval of awarded funding
• Contract
4 Conflicts of Interest and governing the actions of its employees engaged in the selection, award, and administration of contracts.
No employee, officer, or agent may participate in the selection, award, or administration of a contract supported by a Federal award if he or she has a real or apparent conflict of interest. Such a conflict of interest would arise when the employee, officer, or agent, any member of his or her immediate family, his or her partner, or an organization which employs or is about to employ any of the parties indicated herein, has a financial or other interest in or a tangible personal benefit from a firm considered for a contract.
The officers, employees, and agents of the non-Federal entity may neither solicit nor accept gratuities, favors, or anything of monetary value from contractors or parties to subcontracts.
However, non-Federal entities may set standards for situations in which the financial interest is not substantial or the gift is an unsolicited item of nominal value. The standards of conduct must provide for disciplinary actions to be applied for violations of such standards by officers, employees, or agents of the non-Federal entity.
Procurement documentation shall be maintained containing the following elements:
• Pre-award independent cost estimate
• Documentation on procurement method
• Copies of procurement documents
RESTRICTIONS ON DUPLICATION OF BENEFITS:
CDBG funds may not be used to supplant or duplicate private, federal, State, or local government funding.
The Applicant must disclose any funds received in response to the COVID-19 pandemic from private sources, and from any federal, State, or local government programs. Acceptance of other funding will not disqualify an applicant from the Program but may affect the amount of funds available or eligible costs. Applicants will provide personal and business bank statements. The City will review the statements to identify any unreported influx of cash.
If a Borrower receives funds from any source for the same costs that are funded under this Program, the Borrower must repay the duplicative funding. Either the CDBG business loan or the other funding source may be repaid. Other sources may include, but not are not limited to:
• Private sources including bank loans (not including documented loan from a relative); • Small Business Administration (SBA) Paycheck Protection Program (PPP), Economic Injury Disaster Loan Program (EIDL) or Economic Adjustment Assistance Program (EAA); • State of California iBank Small Business Disaster Relief Loan Guarantee Program; • State of California Pandemic Unemployment Assistance; or • Any other federal, State, or local government program providing funding for items noted as eligible costs for this Program.
DUPLICATION OF BENEFITS:
All businesses are required to complete a Duplication of Benefits (DOB) Affidavit as part of the application process. This affidavit acknowledges the City’s requirement that any person or entity 5 receiving CDBG-CV assistance must agree to repay assistance that is determined to be duplicative.
To meet HUD’s requirements, the City has developed a method of assessing whether the use of CDBG-CV funds will duplicate financial assistance that is already received or is likely to be received by acting reasonably in evaluating need and the resources available to meet that need.
This assessment process is as follows:
1. Upon receipt of the completed application packet to the Program, the City of Chowchilla and Consultant will review the Duplication of Benefits Affidavit to determine if the applicant has reported receiving any potentially duplicative assistance.
2. If so, the City or Consultant will request additional information from the applicant, including:
a. Dates funds were received
b. Specific uses of funds received, including receipts and dates as appropriate.
3. Based on a review of this information, the City or Consultant may:
a. Determine that there is no duplication and proceed with consideration of the application for the full amount requested.
b. Determine that there is a partial duplication and proceed with consideration of the application for an amount that reduces the request by the Duplication of Benefits (“DOB”) amount:
i. (Amount Requested) – (Amount of DOB) = Eligible Amount c. Determine that there is a complete duplication and deny the application.
4. In the event that an application moves forward and is approved, in whole or in part, the applicant will be required to sign a Subrogation Agreement to address concerns around the potential for future duplication (for example a Paycheck Protection Program application was made and was not denied but the applicant has not heard back).
5. In the event that an application is approved in part, the City will also include in the funding documents specific information around what the funds may be spent on so as to avoid duplication of benefits.
6. The City or Consultant will require all successful applicants to provide documentation as to how funds are actually expended and will review this documentation to ensure no duplication has taken place.
All application documents, including the Affidavit and Subrogation Agreement, shall be retained in compliance with HUD’s record retention requirements.
REVIEW PROCESS:
The following priorities will be considered when awarding funds:
• The business provides jobs to low- to moderate-income individuals. • The number of jobs that the business sustains during a normal business cycle. • The business demonstrates that it has lost a significant share (25% or more) of revenue due to the COVID-19 pandemic.
• The business demonstrates a strong chance of remaining open post COVID-19. 6 • The business has operated consistently a minimum of one year prior to date of application.
• Priority will be given to businesses located within low/moderate census tracts as defined by HUD.
• All eligibility criteria has been met.
DOCUMENTATION:
Each beneficiary or project file will contain the following:
1. Duplication of Benefit Calculation Worksheet form to include:
a. Identification of unmet need
b. Identification of all sources of assistance provided to applicant c. Identification of those sources that are duplicative (with comments as needed) d. Final award calculation
2. Any required third party verifications of assistance and/or certifications as follows:
a. FEMA programs: letter/s from FEMA and/or data provided by FEMA b. Insurance: letter from insurance company and/or data if available c. SBA: letter/s from SBA and/or data provided by SBA
d. Other program documentation
3. Certification that no additional benefits have been received. This can be a signed affidavit from the beneficiary or other form as created by the program.
4. A signed subrogation agreement from the recipient
Note: Items 3. and 4. can be on the same form.
For businesses opening after March 27, 2020, COVID 19 impact must be demonstrated by evidence of one of the following:
• Ordered to close from either a state or local government (proof must be submitted) • Had to lay off at least one full time or part time employee due to circumstances created by the pandemic (proof must be submitted along with a written affidavit) • Show loss of income via business annual gross revenue as reported on their tax returns.
Comparison tax returns 2019/2020 or 2020/2021.
MONITORING:
The applicant is responsible for providing the Program with documentation demonstrating that grant funds were used in the way they were intended.
The City will review the business’ application to identify how the business said they would use funds and will collect supporting documents. If a business finds it necessary to change their intended use of the funds, they must seek approval from the City in writing before making any changes and submit an updated itemized lists of business expenses.
Although this list is not intended to be exhaustive, supporting documents may include:
7 • Lease agreement and rent receipts
• Invoices with receipts/proof of payment
• Payroll documents
All collected documents will be placed in a business’s program file.
Policies and Procedures shall be reviewed on an annual basis.
Complete applications and any questions should be submitted via email to:
Michael Baker International
Attention: Rebecca Winnie, City Consultant
[email protected]
8 APPENDIX A
LOAN UNDERWRITING CRITERIA SUMMARY
A.1 ELIGIBLE LOAN APPLICANTS
Eligible Economic Development Loan Program (EDLP) Forgivable Loan applicants, here after called “Borrower Eligible for Loan Forgiveness” must meet the criteria outlined below and as amended by U.S. Department of Housing and Urban Development (HUD) and the California Housing and Community Development Department (HCD):
• Be an existing business with no more than 100 full-time equivalent (FTE) employees a minimum of one year prior to the date of application submittal and in financial distress as a result of the COVID 19 pandemic or other presidentially declared disaster (“disaster”) that has resulted in (or will result in) the loss of jobs, 51% are held by LMI individuals as a result of the COVID crisis.
• Is shown to have been financially viable a minimum of one year prior to the date of application submittal. Financial viability may be demonstrated by one or more of the following:
o A profit and loss statement (including income from operations, other income, cost of goods sold, operating expenses, taxes and fees, short-term debt service) showing profitable operations, (non-cash expenses such as depreciation, major capital investments and amortization of capital may be excluded). o A cash flow forecast showing the expected potential for positive net income in subsequent periods demonstrated by accounts receivable, backlog, opening of new markets and expansion of customer base.
o A business plan that supports good prospects for viability going forward. • Be in operation a minimum of one year prior to the date of application submittal and be able to provide the prior year’s federal business tax return (with all schedules) or appropriate federal personal tax returns with appropriate business-related schedules and forms (e.g., Schedules C, D, E, SE, 1, 1099’s, etc.).
• Be an existing business with a previous history of creditworthiness that is 51% or more owned and operated by a U.S. Citizen(s) or permanent legal resident(s) • The creditworthiness determination will also include an assessment of the previous creditworthiness of any owners with a 20% or greater ownership interest. • Be able to provide Year-to-Date (YTD) financial statements a minimum of one year prior to the date of application submittal including (P&L statement, A/P Aging Report, A/R Aging Report, Debt Schedule).
• Have or developed the capacity to generate monthly financial statements (i.e., P&L Statement, A/P Aging Report, A/R Aging Report, Debt Schedule) following receipt of the loan.
• The business must be established to operate legally in the State of California [e.g., registration with the CA Secretary of State and/or Madera County as a “Doing Business As” (DBA) Fictitious Business Names Statement (FBNS)] with a valid City of Chowchilla Business License (if applicable). A FBNS will be required for all businesses. • The business must have:
o Required local, state, and federal permits.
o Proper insurance for current and proposed business activities. o Be operating out of a location with zoning that allows for current and proposed business activities.
o An existing commercial lease with renewal options that extend, at a minimum, to the month and year designated as the final month and year of the loan agreement. A home-based business must have a comparable mortgage, lease or rental agreement that extends, at a minimum, to the same period required for a commercial lease. 9 o NOTE: If a Borrower is an existing business relocating to the City of Chowchilla or is a new startup business and does not have proper permits, licenses, leases, or insurance at the time of application, then these items can be made a condition of funding the loan.
A.2 INELIGIBLE LOAN APPLICANTS
Ineligible EDLP Loan applicants include those businesses for which any of the following are true:
• The resulting EDLP Loan will result in a “duplication” of funding from other disaster related funding programs (e.g., SBA PPP, SBA EIDL, insurance reimbursement, local/regional funding/grant programs) that will be used for the same expense. • The business and underwriter cannot establish a clear nexus between the financial impacts of the disaster and the need for EDLP funding.
• The business and/or business owners with a 20% business ownership interest have liens or pending lawsuits that may have an adverse impact on the financial viability of the business.
• The business’s physical place of business is located outside of the jurisdictional boundaries of the City of Chowchilla.
• The business’s physical place of business is located on tribal lands. • The business or any one of its principals is on the Federal debarred list. • The business or any of its principals have defaulted on any Federal debt. • The business or any of its principals have a relationship with the Lender that violates CDBG Conflict of Interest guidelines.
• The business’ goods or services involve the distribution, sale or use of cannabis or products containing cannabis or cannabis derivatives.
• The business is involved in a business activity prohibited by CDBG regulations (e.g., private golf club).
A.3 ELIGIBLE USES OF FUNDS FOR LOANS WITH FORGIVABLE LOAN TERMS The uses of EDLP funds for loans with forgivable loan terms are restricted to eligible uses as approved by HUD and HCD CDBG Program Guidelines.
Loan proceeds may be used to cover the following eligible costs:
• Operating Expenses (OE) and Working Capital (W/C) as defined below:
o OE includes primary expenses including, but not limited to, payroll, insurance, lease payments and utilities.
o W/C is any additional capital needs (e.g., inventory) with the amount to be net of OE. o The amount of OE and W/C needs presented in financial and cash flow statements must reflect amounts per month that are supported by pre-disaster financial information (e.g., monthly financial statements or Year End business tax returns). • Purchase of furniture, fixtures, and equipment (FF&E) to support the business’ needs to re-open and/or operate as a result of the disaster. FF&E purchases that will trigger Federal or State prevailing wage requirements will be considered on a case-by-case basis. • Refinancing of some forms of existing short-term debt when the refinancing complies with HUD and HCD CDBG underwriting guidelines, is done in conjunction with financing other eligible costs and contributes to the business’ ability to sustain operations and retain the required number of CDBG eligible jobs. NOTE: Examples of short-term debt that may be refinanced could include high interest credit cards or short-term loans from on-line lenders where the business can provide supporting documentation that clearly demonstrates that funds were used for eligible business purchases and expenses). 10 • Loan funds will be disbursed as per the terms outlined in section B.8 A.4 LOAN REQUIREMENTS – CDBG NATIONAL OBJECTIVES INCLUDING
APPROVED WAIVERS
Borrowers that are eligible for HUD and HCD approved waivers must comply with CDBG National Objectives in accordance with the guidelines presented in Appendix M of the NOFA and any supplemental written guidance provided by HCD.
A.5 LOAN REQUIREMENTS – CDBG AND EDLP UNDERWRITING CRITERIA FOR
LOANS WITH FORGIVENESS TERMS
A.5.1 CDBG Underwriting Criteria
Eligible EDLP applicants for loans with forgiveness terms are underwritten in accordance with the following CDBG underwriting criteria.
• Project costs are reasonable as evidenced by 3rd party cost estimates (e.g., vendor quotes, copy of online search, etc.).
• All project costs are eligible per federal regulations and HCD guidelines. • All sources of project financing are committed to support the financial projections that demonstrate that, with EDLP funds, the business is likely to continue operations and retain (or re-create) the projected number of jobs (51% of which are filled by LMI individuals or, if lost due to normal turnover, will be may available to LMI individuals). This may include:
o Borrower or other private funds (proof of funds availability such as bank statements and a signed letter indicating that the funds will be contributed to the project are required).
o A detailed letter of interest from a financial institution outlining the loan amount, loan term, interest rate, collateral requirements, loan-to-value ratio, debt service coverage ratio (DSCR), etc. will be required for the underwriting process. o An approval letter from another government, nonprofit or other business or infrastructure financing program.
• To the extent practicable, EDLP funds are not substituted for non-Federal financial support. This will include an assessment to ensure no duplication of funds from other federal, state, or private sources that may have been provided to assist the business in response to a disaster, economic downtown or other event. • The project is financially feasible based on the underwriter’s assessment of the items defined below:
o The management team has the capacity to execute the business plan and meet the financial projections (i.e., sales revenues, COGS, operating expenses, and profitability).
o The historic creditworthiness of owners with a 20% or greater interest or any member of the management team with check writing authority.
• The financial operating and cash flow projections:
o Are in line with the business’ previous seasonal fluctuations in financial performance and/or reflect anticipated conditions that may impact Revenues, COGS (if applicable), Operating Expenses and Profitability during the term of the EDLP. o Show an ability for the business to reach a level of financial breakeven with EDLP and other funding during the term of the EDLP.
NOTE: A formal, signed commitment letter from the financial institution with the same loan amount, loan terms, interest rate, collateral requirements, loan-to-value ratio, DSCR, etc. will be required before EDLP funds will be released.
11 o Clearly demonstrate that the Borrower will generate sufficient income to retain (or recreate) the projected number of jobs within an agreed upon term established between the Borrower, the Administrator, and the Lender.
o Demonstrate that the business will meet the (DSCR) required by other lenders. o Demonstrate that the business will generate sufficient revenue to provide the salaries, wages or draws needed by the owner(s) to cover their personal expenses taking into consideration other sources of income available to meet owners’ personal financial needs.
• As EDLP loans with forgiveness terms will be limited to businesses that have faced financial conditions that resulted in the loss of jobs or are in imminent danger of facing financial conditions that will result in the loss of jobs, underwriting will not include 1) an assessment of the return on owner’s equity invested in the project, nor 2) an assessment of the disbursement of EDLP funds on a pro-rata basis with other project financing.
The EDLP underwriting process for loans with forgiveness terms will require documentation to assess the ability of the business to sustain operations (e.g., documentation on other debt, historic business financial statements and tax returns for 2019, historic personal financial statements and tax returns for 2019, personal credit reports, financial projections and DSCR).
The EDLP underwriting process for loans with forgiveness terms will require documentation to assess the ability of the business to sustain operations (e.g., documentation on other debt, historic business financial statements and tax returns for a minimum of one year prior to the date of application, historic personal financial statements and tax returns for the year prior to the date of application, personal credit reports, financial projections and DSCR). However, the following additional (or more detailed) information may, at the underwriter’s discretion, be required due to the CBDG underwriting criteria outlined above and the willingness of the City of Chowchilla to consider higher risks loans in exchange for the project the CDBG National Objective and Public Benefit requirements outlined above.
• A detailed breakdown in the financial statements with line items showing:
o Salaries/wage, employment taxes and benefit expenses for existing employees with a breakdown for those employees that will be retained with the assistance from the EDLP loan and should align with the Job Tracking Form submitted with the Borrower’s application.
o A history of the business and brief bios of each of the key members of the management (e.g., CEO, CFO, CTO, etc.) and operating team (e.g., Production Manager, Sales Manager, etc.).
o A summary of the market(s) served and any adjustments to accommodate for disaster related impacts.
o A schedule of owner’s equity invested in the businesses and any new debt incurred prior to one year from the date of application (the debt summary should include the name of the source, the amount borrowed, loan terms, interest rate, current balance, etc.).
o A timeline outlining when funds from each source of financing will be expended (including EDLP and non-EDLP sources).
A.5.2 EDLP UNDERWRITING CRITERIA FOR LOANS WITH FORGIVENESS TERMS Eligible EDLP applicants for loans with forgiveness are underwritten in accordance with the following EDLP underwriting criteria.
• Business is located within the jurisdictional boundaries of the City of Chowchilla. • Financial Ratios:
12 o DSCR – an aggregate business DSCR of no lower than 1.0 (includes an aggregate of the DSCR for all non- EDLP debt financing).
o Global Cash Flows – an aggregate of business DSCR and personal cash needs are sufficient to cover personal operating expenses including a personal DSCR of no lower than 1.0.
o Net Income (after taxes and interest) sufficient to meet DSCR requirements outlined above.
• The Administrator will work closely with the eligible businesses to ensure they understand the requirements of the EDLP and the benefits of participating.
A.6 DETERMINATION OF LOAN AMOUNTS
EDLP loan with forgiveness terms will comply with HUD and/or HCD regulations and guidelines as outlined in NOFA Appendix M and other written documentation provided by HUD and/or the HCD.
A.7 DETERMINATION OF LOAN TERM
EDLP loan with forgiveness terms will comply with HUD and/or HCD regulations and guidelines as outlined in NOFA Appendix M and other written documentation provided by HUD and/or the HCD.
A.8 DETERMINATION OF LOAN INTEREST RATE
EDLP loan with forgiveness terms will comply with HUD and/or HCD regulations and guidelines as outlined in NOFA Appendix M and other written documentation provided by HUD and/or the HCD. It is anticipated that loans with forgiveness terms will be zero percent (0%) for the specified term of the loan unless otherwise specified by the HCD.
A.9 LOAN DISBURSEMENT – LOANS WITH FORGIVENESS TERMS
Loan disbursement for loans with forgiveness terms will be in accordance with HUD and HCD regulations, guidelines, or other written procedures.
Disbursement of loan proceeds will take place only after all conditions have been met and loan documents executed. The procedure for loan disbursement will vary depending upon the purpose of the loan funding as outlined below:
• Operating Expenses and Working Capital – to be disbursed at 50% upon execution of the Promissory Note and 50% after six months in an amount that aligns with the cash flow needs as presented in the pro forma financials provided by the Borrower during the application process and updated as necessary prior to loan closing or due to changing operating conditions following loan closing.
• Furniture, Fixtures & Equipment – to be paid directly to the vendor upon receipt of a valid invoice or to be paid to the borrower upon receipt of a valid invoice and proof of payment (e.g., cancelled check or paid credit card bill)
The Administrator will approve all disbursements and evaluate the sustained viability of the business prior to disbursing future monthly Operating Expense and/or Working Capital advances.
A.10 LOAN MONITORING AND COMPLIANCE FILES – LOANS WITH FORGIVENESS TERMS
Following closing, monitoring files will be set up. Two separate physical and/or electronic loan files shall be maintained. The first is the legal file which holds all the original executed loan documentation. This electronic and/or physical file shall be kept in Lender’s or Administrator’s 13 fireproof vault or cloud-based backup for safekeeping. At a minimum the legal file shall include (if applicable):
• Promissory Note
• Loan Agreement with required CDBG language
• Deed of Trust
• General Security Agreement
• Personal Guaranty
• Corporate Guaranty
• Subordinate Agreement
• Life Insurance Policy and Agreement
• Hazard Insurance Policy and Agreement
• General Resolution
• Certificate of Secretary
• Opinion of Counsel
• Inter-creditor Agreement
• Documentation of Site Control (i.e., lease, deed of trust, etc.) The second is a credit file which will contain the day-to-day administrative records of the loan.
The credit file will include, at a minimum, the loan application and financial information associated with the application, loan memorandum, Lender LAC recommendation, disbursement records, reports of site visits, updated financial information provided by the Borrower, CDBG compliance data and other routine information related to the loan.
Application information should include the following as appropriate:
• Loan Disbursement Schedule
• Map verifying borrower is physically located within program boundaries • Documentation of compliance with federal acquisition requirements, if appropriate (e.g., land purchase)
• Documentation of compliance with federal debarred requirements • Copy of CDBG NEPA documents including Authorization to Use Grant Funds, if required (Original to be maintained in Lender’s Environmental Review Records file) • Copy of Documentation to determine Cost Reasonableness • Documentation to support National Objective/Public Benefit requirements for job retention that shows clear and objective evidence that jobs will be lost without CDBG assistance. • Signed CDBG Documents:
o Loan Certification Form
o Job Tracking Form (demonstrating CDBG compliance with LMI job creation/retention) o No Conflict-of-Interest Certification
o No Job Anti-Pirating Certification
o Income Certification forms (including Part 5 if required or other required income certification documentation)
A.11 LOAN SERVICING – LOANS WITH FORGIVENESS TERMS
A.11.1 Loan Servicing Agent
Loan servicing will be conducted by the Administrator with the Lender. 14 A.11.3 Loan Servicing And Document Collections Procedures Once the loan is closed, the Borrower is entered into a forgivable loan servicing system. EDLP loan with forgiveness terms will be serviced as follows:
• Administrator to secure evidence of purchase and payment for FF&E purchased with EDLP funds for review and comparison to loan application documents and budgets to validate cost reasonableness and CDBG compliance (e.g., NEPA, Prevailing Wage, etc.).
If in noncompliance, Administrator and Lender will determine if corrective action is required and implement corrective action if necessary.
• Borrower to provide the following to the Administrator for review by the 15th of the month following the close of the previous month:
o P&L and Balance Sheet or a P&L, A/P Aging and A/R Aging statements. o An updated Debt Schedule.
o Payroll records.
Once the loan is closed, the Administrator will monitor the loan to maintain the loan records in compliance with the Program objectives and CDBG guidelines. A servicing and documentation system will be maintained with a file for each borrower.
APPENDIX B
Chronology of Updates to City of Chowchilla CV1 and CV2-3 Small Business Loan Program (SBLP) Guidelines
VERSION NO. APPROVAL DATE AMENDMENT
1.0 09/14/2021 Original SBLP Guidelines approved by City Council
2.0 11/17/2022 Updated SBLP Guidelines approved by City Council:
• Increased award amount from $10,000 to
$50,000 under Funding section
• Removed requirement that applicant to have
been in business since March 1, 2019 to a
minimum one year prior to date of application
under Eligibility and Review Process sections
• Added UEI/SAM.gov registration requirement to
Eligibility and Required Documents sections
• Updated moderate income level from 120% to
80% under Eligibility section
• Added Restriction on Duplication of Benefits
section
3.0 07/11/2023 Updated SBLP Guidelines approved by City Council:
• Added verbiage regarding compliance with
procurement regulations in 2 CFR 200.318 -
200.326 when procuring goods or services
• Specified how procurement documentation files
are maintained, including:
o Pre-award independent cost estimate
o Documentation on procurement method
o Copies of procurement documents
• Specified Program Guidelines revision and
approval and dates
• Specified how guidelines are consistently
applied across all awards
• Specified process of checking and verifying to
avoid duplication of benefits
• Included chronology of approvals
REPORT TO THE CITY COUNCIL
Item 4.4
CLICK HERE
TO RETURN TO
THE AGENDA
Meeting of: April 22, 2025
AGENDA SECTION: Public Hearing
SUBJECT: Consideration and Adoption of a City Council Resolution Approving the Close Out of the 20-CDBG-12078 Grant Program
PREPARED BY: Janae Lacey, Community and Economic Development Specialist APPROVED BY: Jaime Quintana, Community & Economic Development Director ATTACHMENTS: 1. Resolution
2. Public Hearing Notice
3. CDBG-CV Small Business Loan Program Guidelines
REVIEWED BY
ADMINISTRATOR ☒ REVIEWED BYATTORNEY ☒ REVIEWED BY FINANCE ☐ RECOMMENDATION:
City staff recommends that the City Council of the City of Chowchilla:
• Receive the staff report and enter it in the record; and • Adopt a resolution approving and authorizing the 20-CDBG-12078 program closeout BACKGROUND:
CDBG Program regulations required that the City conduct a public hearing on all CDBG-related matters to provide for and encourage citizen participation, particularly by low- and moderate-income persons who reside in areas in which CDBG funds are used. Therefore, when the public hearing opened, the public was invited to comment on the City’s proposed submittal of 2019/2020 CDBG Grant applications and to make their comments known on the proposed activities.
A public notice was published in the March 11, 2020, issue of the Madera Tribune notifying the public of this public hearing. The City also published a public hearing notice in the March 14, 2020 issue of the Madera Tribune notifying the public of its intent to seek proposals for the Economic Development Loan Program. The public hearing scheduled to review submitted proposals to assist the City of Chowchilla with the implementation of the Economic Development Loan Program was scheduled for April 14, 2020.
On January 21, 2020, HCD released a NOFA announcing the availability of CDBG Program funds of approximately $60 million from the 2019-2020 funding allocation. Competitive applications were originally due on April 15, 2020 with Over-the-Counter (OTC) Applications being accepted February 14, 2020 until September 30, 2020. However, due to the coronavirus, HCD postponed the deadline to June 1, 2020.
Eligible activities predominantly benefited low- and moderate-income Californians and include:
Housing Assistance Programs (Single-Family Homeownership Assistance, and Single-Family Housing Rehabilitation); Public Facility and Public Improvements projects (including Public Improvements in Support of New Housing Construction); Public Service programs, Planning Studies, Economic Development Business Assistance and Microenterprise activities.
Resolution No. 19-20 was passed and adopted on March 24, 2020. The City was awarded $500,000.00 for business assistance and for administration. The grant supported the following businesses to cover payroll and equipment, with $35,000 for each full-time equivalent job created or retained up to three employees:
• Note Servicing Center - $105,000.00
• Flight Craft Boats - $105,000.00
• Salter’s Distributing - $105,000.00
• The Paw Spa - $70,000.00
• Sitting Pretty - $35,000.00
• Grant Administration - $79,641.29
FISCAL IMPACT:
There is no fiscal impact to the City of Chowchilla for the closeout of the grant program.
ALTERNATIVES:
1. Approve, subject to other than recommended by staff (identify specific findings and/or conditions amended; or, to be addressed in City Council motion); or,
2. Deny; or,
3. Refer to City Staff for reconsideration of specific items to be addressed in City Council motion.
ACTIONS FOLLOWING APPROVAL:
City Administrator to execute and submit all required grant closeout materials to HCD.
COUNCIL RESOLUTION # XX-25
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHOWCHILLA, CALIFORNIA APPROVING THE CLOSE OUT OF 2020 COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM – 20-CDBG-12078
WHEREAS, the City of Chowchilla received Community Development Block Grant (CDBG) funds for Economic Development in the amount of $500,000.00 from the CDBG Grant 20-CDBG12078; and WHEREAS, the City of Chowchilla is required to comply with all state and federal public participation requirements in the closeout process;
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chowchilla hereby finds, determines and declares the following:
1. The City Council hereby approves to disencumber $358.71 in CDBG funds from its grant program.
2. The City Administrator is authorized to sign and act on the City's behalf in all matters relating to the 20-CDBG-12078 grant closeout.
PASSED AND ADOPTED by the City Council of the City of Chowchilla this 22nd day of April, 2025 by the following vote to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
Mayor Kelly Smith
ATTEST:
Joann McClendon, CMC
City Clerk
CITY OF CHOWCHILLA
PUBLIC HEARING NOTICE
NOTICE IS HEREBY GIVEN that the City of Chowchilla will conduct a public hearing on APRIL 22, 2025 at 7:00pm, at the Chowchilla City Council Chambers located at 130 South 2nd Street, Chowchilla, CA 93610, in order to discuss and solicit comments on the submittal of the Community Development Block Grant (CDBG) accomplishments and acceptance of the closeout report for the following grant activities:
CDBG Grant 20-CDBG-12078
Economic Development $500,000.00 Award
$499,641.29 Spent
$358.71 Disencumbering
CDBG-CV Grant 20-CDBG-CV1-00094
Economic Development $92,456.00 Award
$57,812.87 Spent
$34,643.13 Disencumbering
CDBG-CV Grant 20-CDBG-CV2-3-00037
Economic Development $336,439.00 Award
$137,126.98 Spent
$199,312.02 Disencumbering
The City will be required to disencumber $358.71 of CDBG and a total of $233,955.15 of CDBG-CV funds for Economic Development due to receiving additional CDBG funds that offered higher forgivable loans to qualifying businesses and businesses not meeting the criteria for CDBG-CV funding.
The purpose of this public hearing is to give citizens an opportunity to make their comments known regarding the accomplishments under the State administered CDBG Program. If you require special accommodations to participate in the public hearing, please contact Jaime Quintana, Community and Economic Development Director, City of Chowchilla, 130 South 2nd Street, Chowchilla, CA 93610, or you may telephone (559) 665-8615. In addition, the proposed plan is available for review at the above address between the hours of 8:00 a.m. and 5:00 p.m. on Monday – Friday.
If you are unable to attend the public hearing, you may direct written comments to the City of Chowchilla, 130 South 2nd Street, Chowchilla, CA 93610, or you may telephone Mark Jaime Quintana at (559) 665-8615. In addition, information is available for review at the above address between the hours of 8:00 a.m. and 5:00 p.m. Monday – Friday.
The City of Chowchilla promotes fair housing and makes all its programs available to low- and moderate-income families regardless of age, race, color, religion, sex, national origin, sexual preference, marital status, or handicap.
No. 8201 - April 12, 2025
TABLE OF CONTENTS
1. INTRODUCTION .............................................................................................................1
1.1 Purpose ....................................................................................................................1
1.2 Definitions and Abbreviations....................................................................................1
1.3 Administration ...........................................................................................................2
2. TYPE OF ASSISTANCE AVAILABLE..............................................................................2
3. MEETING A CDBG NATIONAL OBJECTIVE..................................................................2
3.1 Low/Mod Income Owner Microenterprise – Priority Activity ......................................2
3.2 Low/Mod Job Retention – Priority Activity.................................................................2
3.3 Low/Mod Job Creation ..............................................................................................2
3.4 Urgent Need and Low/Mod Area Benefit ..................................................................3
4. ECONOMIC DEVELOPMENT PUBLIC BENEFIT STANDARD ......................................3
4.1 Low/Mod Job Retention and Job Creation National Objective Activities ...................3
4.2 Low/Mod Area Benefit National Objective Activities..................................................3
5. HUD CDBG REQUIREMENTS FOR ASSISTANCE TO A FOR-PROFIT ENTITY..........3
5.1 Restrictions on Duplication of Benefits......................................................................4
5.2 Prohibition of Job Pirating Activities ..........................................................................4
5.3 Unique Entity Identifier and Non-Debarment ............................................................4
6. EQUAL OPPORTUNITY MARKETING............................................................................4
7. APPLICANT ELIGIBILITY................................................................................................5
7.1 Eligible Applicants.....................................................................................................5
7.2 Ineligible Applicants ..................................................................................................5
8. USE OF FUNDS ..............................................................................................................5
8.1 Eligible Costs ............................................................................................................6
8.2 Ineligible Costs..........................................................................................................6
9. BUSINESS ASSISTANCE FORGIVABLE LOAN TERMS...............................................6
9.1 Maximum Loan Amount ............................................................................................6
9.2 Interest Rate .............................................................................................................6
9.3 Loan Term.................................................................................................................6
9.4 Loan Disbursement Schedule...................................................................................6
9.5 Loan Forgiveness .....................................................................................................7
9.6 Term of Payment ......................................................................................................7
9.7 Loan Fee...................................................................................................................7
9.8 Prepayment Penalty..................................................................................................7
9.9 Collateral Requirements ...........................................................................................7
10.CONFIDENTIALITY.........................................................................................................7
11.APPLICATION SUBMISSION REQUIREMENTS............................................................7
12.UNDERWRITING CRITERIA FOR BUSINESS ASSISTANCE FORGIVABLE LOANS...8
12.1 HUD Underwriting Objectives .................................................................................8
12.2 Program Criteria for Business Assistance Loans ....................................................8
12.3 Exceptions to Underwriting Criteria.........................................................................9
13.APPROVAL AND APPEAL PROCESS............................................................................9
13.1 Loan Advisory Committee.......................................................................................9
13.2 Approval/Denial.......................................................................................................9
13.3 Loan Disbursement.................................................................................................9
13.4 Appeal Process.......................................................................................................9
14.OTHER FEDERAL REQUIREMENTS.............................................................................9
14.1 Conflict of Interest .................................................................................................10
15.PORTFOLIO MANAGEMENT........................................................................................10
15.1 Ineligible Expenditure of Program Funds ..............................................................10
15.2 Loan Default Procedures ......................................................................................10
16.CONFLICT WITH FEDERAL LAW, REGULATION OR GUIDANCE .............................11 APPENDICES:
APPENDIX A – INCOME LIMITS FOR MADERA COUNTY...............................................11 APPENDIX B – LOAN UNDERWRITING CRITERIA SUMMARY.......................................12
1. INTRODUCTION
In response to economic hardships experienced by small businesses due to the COVID-19 pandemic, the City of Chowchilla (City) has established a business assistance program using Community Development Block Grant (CDBG) funding received from the U.S. Department of Housing and Urban Development (HUD). The COVID-19 Response Small Business Assistance Program (the Program) will provide assistance to small businesses affected by the COVID-19 pandemic with a focus on support for job retention for low- and moderate-income persons and microenterprise businesses. These guidelines are intended to establish the Program and are subject to review and amendment as needed to respond to the evolving economic environment resulting from the pandemic.
All federal requirements for CDBG funded assistance to for-profit entities will be followed unless waived or otherwise exempted by HUD.
1.1Purpose
The Program will provide financial assistance to small businesses with a physical location in the City of Chowchilla to minimize job losses resulting from the economic impacts of the COVID-19 pandemic.
The Program is designed to promote economic stability by providing relief in the form of a onetime forgivable loan for essential operating expenses and supplies to the City’s small businesses negatively impacted by COVID-19.
1.2 Definitions and Abbreviations
CARES Act – Coronavirus Aid, Relief and Economic Security Act.
CDBG – Community Development Block Grant funding received from HUD.
City – The City of Chowchilla, City staff, or agents designated by the City to act on its behalf.
Full Time Equivalent (FTE) Job – Equals at least 1,750 hours annually (approximately 34 hours per week). A total of two jobs may be added together to equal one FTE.
HUD – The U.S. Department of Housing and Urban Development.
Low/Mod person – A low- and moderate-income person is defined by HUD as a person whose family income does not exceed 80% of the HUD median income, adjusted for family size, for the Chowchilla area (see Appendix A for current income limits).
For COVID-19 related job creation or retention activities, a Low/Mod person may also be a person holding a job with annual wages that do not exceed 80% of the HUD median income limit for a one-person family (see Appendix A for current income limits).
Microenterprise – The CDBG program defines a Microenterprise as a business with five or fewer employees, one or more of whom own the business.
1.3 Administration
The City has secured the services of a qualified CDBG Business Loan Program underwriter who is responsible for working with the banks. Public lenders, originating and underwriting business loans, documenting compliance with CDBG regulations, and preparing the loan closing documents,
2. TYPE OF ASSISTANCE AVAILABLE
The maximum funding will be $35,000 per FTE job created and/or retained upon approval, not to exceed $105,000 per applicant. If the business meets the requirements in Section 9 below, the loan may be forgivable.
3. MEETING A CDBG NATIONAL OBJECTIVE
All CDBG funded activities must meet one of the three CDBG National Objectives:
• Provide benefit to Low/Mod income persons or neighborhoods; • Prevention or elimination of slums and blight; or
• Addressing an unplanned urgent need that poses a serious and immediate threat to the health and welfare of the community.
At least 70% of the City’s annual CDBG expenditures must meet the Low/Mod income National Objective.
COVID-19 funds give priority to Low/Mod Job Retention and Microenterprise activities. Business Assistance Forgivable Loans must meet a National Objective in at least one of the four following methods:
3.1 Low/Mod Income Owner Microenterprise – Priority Activity Available to Microenterprise businesses with five or fewer employees, one of which must be an owner with family income under the federal CDBG income limits (Appendix A). The City will verify owner’s family income using HUD approved methods.
3.2 Low/Mod Job Retention – Priority Activity
Available to all eligible businesses, including Microenterprise businesses. CDBG funds are used to support a business that would lose job(s) without assistance. The business must employ at least one full time equivalent (FTE) job. At least 51% of the retained jobs must be held by or made available to Low/Mod Persons.
3.3 Low/Mod Job Creation
Available to all eligible businesses, including Microenterprise businesses. The business must create at least one new full time equivalent (FTE) job and at least 51% of the jobs created must be held by or made available to Low/Mod Persons.
3.4 Urgent Need and Low/Mod Area Benefit
As noted above, the focus of the Program is to support job retention for Low/Mod income persons. However, in rare circumstances, business assistance may qualify under the Urgent Need or Low/Mod Area Benefit National Objectives. Funds must be used to prevent, prepare for, or respond to the COVID-19 pandemic.
Urgent Need requires that the City certify and document the following:
• The activity is designed to alleviate existing COVID-19-related conditions; • The conditions pose a serious and immediate threat to the health or welfare of the community and are of recent origin or recently became urgent; and • The City and the business are unable to finance the activity and that other sources of funds are not available.
Low/Mod Area Benefit may be used for businesses that provide necessary goods or services to persons living in an area with 51% or more low/mod income residents.
4. ECONOMIC DEVELOPMENT PUBLIC BENEFIT STANDARD
The Public Benefit Standard is not applicable to Microenterprise businesses or to activities approved under the Urgent Need National Objective.
4.1 Low/Mod Job Retention and Job Creation National Objective Activities Businesses must demonstrate that with the assistance of Program funds, they may be expected to retain or create at least one permanent full time equivalent (FTE) job for every $35,000 in funding received. This will be determined using the underwriting criteria below.
Only permanent jobs may be counted. If part time positions are used for the Public Benefit Test, no more than two positions may be added together to create the one FTE. Seasonal jobs normally may not be counted. Seasonal jobs may be counted only if the job season lasts long enough to provide sufficient hours and pay to be considered the employee’s main source of income. A minimum of six months would be acceptable, if a minimum of 34 hours is paid for each week during the season. Only two seasonal positions may be counted towards the 34- hour minimum.
4.2 Low/Mod Area Benefit National Objective Activities
The service area of the business must be 51% or more Low/Mod based on HUD census mapping data.
5. HUD CDBG REQUIREMENTS FOR ASSISTANCE TO A FOR-PROFIT ENTITY All federal requirements for CDBG assistance to for-profit entities will be followed unless waived or otherwise exempted by HUD.
5.1Restrictions on Duplication of Benefits
CDBG funds may not be used to supplant or duplicate private, federal, State, or local government funding.
The Applicant must disclose any funds received in response to the COVID-19 pandemic from private sources, and from any federal, State, or local government programs. Acceptance of other funding will not disqualify an applicant from the Program but may affect the amount of funds available or eligible costs. Applicants will provide personal and business bank statements. The City will review the statements to identify any unreported influx of cash.
If a Borrower receives funds from any source for the same costs that are funded under this Program, the Borrower must repay the duplicative funding. Either the CDBG business loan or the other funding source may be repaid. Other sources may include, but not are not limited to:
• Private sources including bank loans (not including documented loan from a relative); • Small Business Administration (SBA) Paycheck Protection Program (PPP), Economic Injury Disaster Loan Program (EIDL) or Economic Adjustment Assistance Program (EAA);
• State of California iBank Small Business Disaster Relief Loan Guarantee Program; • State of California Pandemic Unemployment Assistance; or • Any other federal, State, or local government program providing funding for items noted as eligible costs for this Program.
5.2Prohibition of Job Pirating Activities
CDBG funds may not be used to facilitate the relocation of a for-profit business from one labor market to another if the relocation is likely to result in a significant job loss to the original labor market.
5.3Unique Entity Identifier and Non-Debarment
The Unique Entity Identifier (UEI) is the official identifier for doing business with the U.S.
Government. Businesses must obtain a UEI to be eligible to receive assistance under the City’s Economic Development Loan Program. The Applicant and all business owners may not be under debarment or suspension in the federal System for Award Management (SAM.gov) to receive federal funding assistance.
6. EQUAL OPPORTUNITY MARKETING
Marketing of the Program will be accomplished through a variety of modes to provide all eligible small businesses within the City of Chowchilla with an opportunity to access funding. At a minimum, the Program will be announced in the local newspaper, with marketing brochures, information posted on the City website and social media, marketing through business-related newsletters, and other business venues.
7. APPLICANT ELIGIBILITY
7.1Eligible Applicants
Eligible applicants include locally owned restaurant, retail, and service businesses with a physical storefront/office location in the City of Chowchilla. Applicant businesses may be private for-profit business concerns, corporations, partnerships, or sole proprietorships.
Businesses must employee at least one full-time equivalent position (FTE), not counting the Owner. Businesses may have no more than 100 employees.
Applicants must have been financially viable a minimum of one year prior to the date of application submittal. Financial viability will be determined based on business and personal financial information.
Applicants must have been in business and employing people for a minimum of one year prior to the date of application submittal.
Applicants must have been in good standing with the City of Chowchilla a minimum of one year prior to the date of application submittal (e.g., no liens or judgments, no unresolved code violations, etc.).
Any bankruptcies must have been discharged at least 3 years .
7.2Ineligible Applicants
Federal CDBG regulations prohibit assistance to the following entities:
• Businesses or business owners are ineligible for assistance if a loan would create a conflict of interest as defined in this document or under HUD regulations. • Businesses or business owners that are debarred or suspended under a federal program are ineligible for assistance. Debarment/suspension status will be determined using the SAM.gov website.
• Professional sports teams.
• Privately owned recreational facilities that serve a predominately higher-income clientele. • A business or business owner that is the subject of unresolved findings of noncompliance related to previous CDBG assistance.
8. USE OF FUNDS
Funds provided by the Program must be used for the prevention of, preparation for, or in response to impacts from the COVID-19 pandemic. Financial assistance needed due to loss of revenue or increased costs due to the pandemic; due to related stay-at-home order, needed to address public health concerns related to the virus; or needed to retain job are considered to be in response to the COVID-19 pandemic.
8.1Eligible Costs
Use of Program funds is restricted to working capital for COVID-19 related expenses required to remain in business, to retain jobs for Low/Mod Persons; to create new jobs for Low/Mod Persons; or to address the COVID-19 pandemic. Examples of eligible costs include:
• Employee salaries and benefits;
• Lease, mortgage payments or insurance for buildings where employees are working; • Purchase of personal protective equipment (PPE), social distancing signage, thermometers, hand sanitizer dispensers, cleaning supplies and other items used to reduce the spread of the COVID-19 virus.
Utilities may be considered on a case-by-case basis. HUD does not allow the Program to provide funds to pay utilities administered by the City of Chowchilla. This is considered a conflict of interest under federal guidelines.
8.2Ineligible Costs
• Costs incurred prior to final loan approval unless allowed by HUD. • Costs incurred prior to the City’s completion of environmental review unless allowed by HUD.
• Costs already funded by private sources including private bank loans; or from federal, State, or local government programs.
• Costs associated with construction or renovation.
• Costs not associated with the prevention, preparation for, or in response to, effects of the COVID-19 pandemic.
9. BUSINESS ASSISTANCE FORGIVABLE LOAN TERMS
9.1Maximum Loan Amount
Maximum loan amount shall be $105,000 for up to three FTE jobs created and/or retained.
9.2Interest Rate
Loans will be at zero percent interest rate.
9.3Loan Term
The Loan will terminate upon completion of all program requirements and execution of the forgiveness requests submitted by project application with supporting documentation demonstrating all terms have been met.
9.4Loan Disbursement Schedule
The City will disburse 50% of loan funds upon execution of the Promissory Note and receipt of the Request for Initial Disbursement form signed by the Borrower. The remainder of loan funds will be disbursed upon receipt of documentation that the initial disbursement was spend on eligible costs and the Request for Final Disbursement form signed by the Borrower.
9.5Loan Forgiveness
The City may forgive 100% of the maximum $105,000 loan if:
• The borrower is in compliance with the terms of the loan; • The borrower has met the requirements of the Program; • The borrower has submitted payroll documentation as evidence of any Job Retention required under the Promissory Note;
• The borrower has provided evidence of payment of eligible costs to the City six months from the execution date of the Promissory Note;
• The borrower has returned any funds not expended on eligible costs one year from the execution date of the Promissory Note; and
• The borrower has submitted a Request for Loan Forgiveness form one year from the execution date of the Promissory Note.
9.6Term of Payment
If the borrower does not meet the requirements for loan forgiveness, repayment becomes due and payable one year from the execution date of the Promissory Note.
9.7Loan Fee
There are no loan fees.
9.8Prepayment Penalty
None.
9.9Collateral Requirements
All loans shall be secured by a Promissory Note. Other collateral is not required.
10.CONFIDENTIALITY
The information submitted by Applicants and income self-certification forms provided by employees will be treated as confidential by the City to the extent permitted under State and federal law. The Loan Review Committee receives a summary of business information, not detailed business, or personal information.
11.APPLICATION SUBMISSION REQUIREMENTS
Applications are available by contacting the City of Chowchilla Economic Development Department. Due to health concerns related to the COVID-19, virus electronic documents are preferred; however, paper loan applications are allowed.
Applications will be reviewed on a first come, first served basis until funding is exhausted or the program is terminated.
Applications must be completed in full and signed by a person authorized to execute contracts on behalf of the business. Applications must include all requested attachments to be considered complete and ready for review.
12.UNDERWRITING CRITERIA FOR BUSINESS ASSISTANCE FORGIVABLE LOANS Normal business lending underwriting practices are difficult to apply in the uncertain economic climate created by the COVID-19 pandemic. The pandemic has resulted in unprecedented shelter-in-place orders, layoffs and enforced business closures. As businesses slowly are allowed to reopen, new rules and procedures are needed to ensure the health and safety of employees, customers, and the community. The Program is designed to provide financing flexibility for businesses while still meeting federal CDBG business lending requirements.
Program underwriting criteria are summarized in Appendix B.
Review of applicants for CDBG assistance ensures that local economic needs are met and that the CDBG requirements are observed. The criteria below will be evaluated during the underwriting process to determine past earning record and future prospects; projected ability to pay fixed debt and expenses; and projected job retention or creation (if applicable).
12.1 HUD Underwriting Objectives
Program underwriting criteria are established to ensure that the following HUD required CDBG underwriting criteria are met for loans unless waived or otherwise exempted by HUD. • Project costs are reasonable;
• Other sources of financing needed for business success are committed; • Documentation of need for CDBG funds, including verification that CDBG funds are not substituted for non-Federal financial funding or support; • Business operations will be financially feasible with CDBG assistance; • To the extent practicable, the return on the Borrower’s equity investment will not be more than 20 percent of the return on investment; and
• To the extent practicable, CDBG funds will be disbursed on a pro-rata basis with other finances provided to the business.
HUD does not require the above criteria to be evaluated for Microenterprise businesses; however, the City is required to create its own underwriting criteria for lending to a Microenterprise.
12.2 Program Criteria for Business Assistance Loans
Applicant’s credit will be reviewed. Applicant and the business should demonstrate the ability to pay debts and bills and demonstrate good credit history a minimum of one year prior to the date of application submittal. To the extent practicable, Applicant’s financial projections should demonstrate the ability, with CDBG assistance, to pay debts and bills; and to retain and/or create any required jobs for a one-year period. Applicant’s financial projections should demonstrate the need for financial support as identified in the application.
12.3 Exceptions to Underwriting Criteria
The underwriting criteria are general guidelines that apply to most Applicants. Additional requirements or exceptions may be warranted, depending on the creditworthiness of the Applicant, the history of the business, or other Applicant-specific considerations.
13.APPROVAL AND APPEAL PROCESS
Applications will be reviewed on a first come, first served basis. Priority will be given to businesses providing Job Retention for Low/Mod Persons and to Low/Mod income Microenterprise business owners. Should any funding remain after priority businesses are assisted, businesses providing Job Creation for Low/Mod Persons will be considered.
13.1 Loan Advisory Committee
Once underwriting is completed, a summary of the business and underwriting criteria will be presented to the Loan Advisory Committee, which is responsible for making recommendations for approval or denial to the Director of Community and Economic Development. The Director of Community and Economic Development or his/her designee will make the final approval or denial. The loan summary and its contents will be kept confidential to the maximum extent possible.
13.2 Approval/Denial
If approved, the Applicant will be contacted to arrange to sign loan documents.
If denied, the Applicant will be provided with a written explanation of the denial and any appeal process that may be available within seven (7) days.
13.3 Loan Disbursement
Initial disbursement of 50% of approved funding will proceed as soon as all required documents are executed, and Borrower submits a signed Request for Initial Disbursement to the City.
Disbursement of remaining funds will be processed upon receipt of documentation that the initial disbursement was spent on eligible costs and the Borrower submits a Request for Final Disbursement to the City.
13.4 Appeal Process
An appeal process is established to provide full opportunity for applicants and their business's circumstances to be considered for assistance. Applicants denied assistance may request a second review by the Director of Community and Economic Development. Requests for appeal must be in writing and may be submitted through U.S. mail to: Director of Community and Economic Development, City of Chowchilla, 130 South 2nd Street, Chowchilla, CA 95678.
Application denials by the Director may not be appealed.
14.OTHER FEDERAL REQUIREMENTS
Federal requirements will be followed regarding anti-lobbying certification; prohibitions against payments of bonus or commissions; Clean Air and Water Act; equal opportunity; Affirmative Action; Americans with Disabilities Act (ADA) of 1990; flood disaster protection; federal labor standards provisions (also known as Davis Bacon); lead based paint hazards; federal National Labor Relations Board (NLRB) certification; procurement; program income; relocation, displacement and acquisition; and additional requirements as required by HUD.
14.1 Conflict of Interest
Per State CDBG regulation §7126 (California Code of Regulations, Title 25), any activities that create a conflict of interest as defined in federal CDBG regulations at 24 CFR 570.611 are prohibited. In general, the conflict-of-interest prohibition applies to any person who is an employee, agent, consultant, officer, or elected official or appointed official of a recipient of CDBG funds, or of any public agencies, or subrecipients that receive CDBG funds. These persons who are in a position to participate in a decision- making process or gain inside information regarding CDBG funds and CDBG funded activities are prohibited from obtaining a financial interest or benefit from a CDBG assisted activity.
15.PORTFOLIO MANAGEMENT
A loan file will be maintained for the period required under City and HUD file retention requirements. Loan files will be maintained for both approved and denied applications in compliance with City and HUD retention periods.
15.1 Ineligible Expenditure of Program Funds
Unless otherwise waived or exempted by HUD, loan funds that do not meet Program requirements must be repaid.
Repayment of loan funds that were not spent on eligible costs are to be entered into the City’s accounting system as a repayment of local funds rather than CDBG Program Income.
15.2 Loan Default Procedures
If a Borrower defaults on loan payments, every effort will be made to develop a workout plan with the business owner.
If the Borrower cannot fulfill the terms of the loan or cannot fulfill a workout plan, the City, at its sole discretion, may exercise one of more of the following options. The City will evaluate the cost in staff time, attorney fees and other expenses to determine the most effective and efficient course of action:
• Extend the time of payment or otherwise alter the terms of the remaining indebtedness; • Accept additional security of any kind, including USB filing on business assets, real property trust deeds or a personal guarantee from a third party; and/or • Write off a portion or the full amount of outstanding indebtedness.
16.CONFLICT WITH FEDERAL LAW, REGULATION OR GUIDANCE
If any portion of this document is in conflict with federal law, regulation, or guidance regarding the CDBG program, federal requirements will apply.
APPENDIX A
2022 INCOME LIMITS* FOR MADERA COUNTY
https://www.hcd.ca.gov/grants-and-funding/income-limits/state-and-federal-income-rent-and-loan-valuelimits *To be updated annually when HCD releases current year income limits
APPENDIX B
LOAN UNDERWRITING CRITERIA SUMMARY
B.1 ELIGIBLE LOAN APPLICANTS
Eligible EDLP Forgivable Loan applicants, here after called “Borrower Eligible for Loan Forgiveness” must meet the criteria outlined below and as amended by U.S. Department of Housing and Urban Development (HUD) and the California Housing and Community Development Department (HCD):
• Be an existing business with no more than 100 full-time equivalent (FTE) employees a minimum of one year prior to the date of application submittal and in financial distress as a result of the COVID 19 pandemic or other presidentially declared disaster (“disaster”) that has resulted in (or will result in) the loss of jobs, 51% are held by LMI individuals as a result of the COVID crisis.
• Is shown to have been financially viable a minimum of one year prior to the date of application submittal. Financial viability may be demonstrated by one or more of the following:
➢ A profit and loss statement (including income from operations, other income, cost of goods sold, operating expenses, taxes and fees, short-term debt service) showing profitable operations, (non-cash expenses such as depreciation, major capital investments and amortization of capital may be excluded). ➢ A cash flow forecast showing the expected potential for positive net income in subsequent periods demonstrated by accounts receivable, backlog, opening of new markets and expansion of customer base.
➢ A business plan that supports good prospects for viability going forward. • Be in operation a minimum of one year prior to the date of application submittal and be able to provide the prior year’s federal business tax return (with all schedules) or appropriate federal personal tax returns with appropriate business-related schedules and forms (e.g., Schedules C, D, E, SE, 1, 1099’s, etc.).
• Be an existing business with a previous history of creditworthiness that is 51% or more owned and operated by a U.S. Citizen(s) or permanent legal resident(s) • The creditworthiness determination will also include an assessment of the previous creditworthiness of any owners with a 20% or greater ownership interest. • Be able to provide Year-to-Date (YTD) financial statements a minimum of one year prior to the date of application submittal including (P&L statement, A/P Aging Report, A/R Aging Report, Debt Schedule).
• Have or developed the capacity to generate monthly financial statements (i.e., P&L Statement, A/P Aging Report, A/R Aging Report, Debt Schedule) following receipt of the loan.
• The business must be established to operate legally in the State of California [e.g., registration with the CA Secretary of State and/or Madera County as a “Doing Business As” (DBA) Fictitious Business Names Statement (FBNS)] with a valid City of Chowchilla Business License (if applicable). A FBNS will be required for all businesses. • The business must have:
➢ Required local, state, and federal permits.
➢ Proper insurance for current and proposed business activities. ➢ Be operating out of a location with zoning that allows for current and proposed business activities.
➢ An existing commercial lease with renewal options that extend, at a minimum, to the month and year designated as the final month and year of the loan agreement. A home-based business must have a comparable mortgage, lease or rental agreement that extends, at a minimum, to the same period required for a commercial lease. ➢ NOTE: If a Borrower is an existing business relocating to the City of Chowchilla or is a new startup business and does not have proper permits, licenses, leases, or insurance at the time of application, then these items can be made a condition of funding the loan.
B.2 INELIGIBLE LOAN APPLICANTS
Ineligible EDLP Loan applicants include those businesses for which any of the following are true:
• The resulting EDLP Loan will result in a “duplication” of funding from other disaster related funding programs (e.g., SBA PPP, SBA EIDL, insurance reimbursement, local/regional funding/grant programs) that will be used for the same expense. • The business and underwriter cannot establish a clear nexus between the financial impacts of the disaster and the need for EDLP funding.
• The business and/or business owners with a 20% business ownership interest have liens or pending lawsuits that may have an adverse impact on the financial viability of the business.
• The business’s physical place of business is located outside of the jurisdictional boundaries of the City of Chowchilla.
• The business’s physical place of business is located on tribal lands. • The business or any one of its principals is on the Federal debarred list. • The business or any of its principals have defaulted on any Federal debt. • The business or any of its principals have a relationship with the Lender that violates CDBG Conflict of Interest guidelines.
• The business’ goods or services involve the distribution, sale or use of cannabis or products containing cannabis or cannabis derivatives.
• The business is involved in a business activity prohibited by CDBG regulations (e.g., private golf club).
B.3 ELIGIBLE USES OF FUNDS FOR LOANS WITH FORGIVABLE LOAN TERMS The uses of EDLP funds for loans with forgivable loan terms are restricted to eligible uses as approved by HUD and HCD CDBG Program Guidelines.
Loan proceeds may be used to cover the following eligible costs:
• Operating Expenses (OE) and Working Capital (W/C) as defined below:
➢ OE includes primary expenses including, but not limited to, payroll, insurance, lease payments and utilities.
➢ W/C is any additional capital needs (e.g., inventory) with the amount to be net of OE. ➢ The amount of OE and W/C needs presented in financial and cash flow statements must reflect amounts per month that are supported by pre-disaster financial information (e.g., monthly financial statements or Year End business tax returns). • Purchase of furniture, fixtures, and equipment (FF&E) to support the business’ needs to re-open and/or operate as a result of the disaster. FF&E purchases that will trigger Federal or State prevailing wage requirements will be considered on a case-by-case basis.
• Refinancing of some forms of existing short-term debt when the refinancing complies with HUD and HCD CDBG underwriting guidelines, is done in conjunction with financing other eligible costs and contributes to the business’ ability to sustain operations and retain the required number of CDBG eligible jobs. NOTE: Examples of short-term debt that may be refinanced could include high interest credit cards or short-term loans from on-line lenders where the business can provide supporting documentation that clearly demonstrates that funds were used for eligible business purchases and expenses). • Loan funds will be disbursed as per the terms outlined in section B.8 B.4 LOAN REQUIREMENTS – CDBG NATIONAL OBJECTIVES INCLUDING
APPROVED WAIVERS
Borrowers that are eligible for HUD and HCD approved waivers must comply with CDBG National Objectives in accordance with the guidelines presented in Appendix M of the NOFA and any supplemental written guidance provided by HCD.
B.5 LOAN REQUIREMENTS – CDBG AND EDLP UNDERWRITING CRITERIA FOR
LOANS WITH FORGIVENESS TERMS
B.5.1 CDBG Underwriting Criteria
Eligible EDLP applicants for loans with forgiveness terms are underwritten in accordance with the following CDBG underwriting criteria.
• Project costs are reasonable as evidenced by 3rd party cost estimates (e.g., vendor quotes, copy of online search, etc.).
• All project costs are eligible per federal regulations and HCD guidelines. • All sources of project financing are committed to support the financial projections that demonstrate that, with EDLP funds, the business is likely to continue operations and retain (or re-create) the projected number of jobs (51% of which are filled by LMI individuals or, if lost due to normal turnover, will be may available to LMI individuals). This may include:
➢ Borrower or other private funds (proof of funds availability such as bank statements and a signed letter indicating that the funds will be contributed to the project are required).
➢ A detailed letter of interest from a financial institution outlining the loan amount, loan term, interest rate, collateral requirements, loan-to-value ratio, debt service coverage ratio (DSCR), etc. will be required for the underwriting process. ➢ An approval letter from another government, nonprofit or other business or infrastructure financing program.
• To the extent practicable, EDLP funds are not substituted for non-Federal financial support. This will include an assessment to ensure no duplication of funds from other federal, state, or private sources that may have been provided to assist the business in response to a disaster, economic downtown or other event. • The project is financially feasible based on the underwriter’s assessment of the items defined below:
➢ The management team has the capacity to execute the business plan and meet the financial projections (i.e., sales revenues, COGS, operating expenses, and profitability).
➢ The historic creditworthiness of owners with a 20% or greater interest or any member of the management team with check writing authority.
• The financial operating and cash flow projections:
➢ Are in line with the business’ previous seasonal fluctuations in financial performance and/or reflect anticipated conditions that may impact Revenues, COGS (if applicable), NOTE: A formal, signed commitment letter from the financial institution with the same loan amount, loan terms, interest rate, collateral requirements, loan-to-value ratio, DSCR, etc. will be required before EDLP funds will be released.
Operating Expenses and Profitability during the term of the EDLP. ➢ Show an ability for the business to reach a level of financial breakeven with EDLP and other funding during the term of the EDLP.
➢ Clearly demonstrate that the Borrower will generate sufficient income to retain (or recreate) the projected number of jobs within an agreed upon term established between the Borrower, the Administrator, and the Lender.
➢ Demonstrate that the business will meet the (DSCR) required by other lenders. ➢ Demonstrate that the business will generate sufficient revenue to provide the salaries, wages or draws needed by the owner(s) to cover their personal expenses taking into consideration other sources of income available to meet owners’ personal financial needs.
• As EDLP loans with forgiveness terms will be limited to businesses that have faced financial conditions that resulted in the loss of jobs or are in imminent danger of facing financial conditions that will result in the loss of jobs, underwriting will not include 1) an assessment of the return on owner’s equity invested in the project, nor 2) an assessment of the disbursement of EDLP funds on a pro-rata basis with other project financing.
The EDLP underwriting process for loans with forgiveness terms will require documentation to assess the ability of the business to sustain operations (e.g., documentation on other debt, historic business financial statements and tax returns for 2019, historic personal financial statements and tax returns for 2019, personal credit reports, financial projections and DSCR).
The EDLP underwriting process for loans with forgiveness terms will require documentation to assess the ability of the business to sustain operations (e.g., documentation on other debt, historic business financial statements and tax returns for a minimum of one year prior to the date of application, historic personal financial statements and tax returns for the year prior to the date of application, personal credit reports, financial projections and DSCR). However, the following additional (or more detailed) information may, at the underwriter’s discretion, be required due to the CBDG underwriting criteria outlined above and the willingness of the City of Chowchilla to consider higher risks loans in exchange for the project the CDBG National Objective and Public Benefit requirements outlined above.
• A detailed breakdown in the financial statements with line items showing:
➢ Salaries/wage, employment taxes and benefit expenses for existing employees with a breakdown for those employees that will be retained with the assistance from the EDLP loan and should align with the Job Tracking Form submitted with the Borrower’s application.
➢ A history of the business and brief bios of each of the key members of the management (e.g., CEO, CFO, CTO, etc.) and operating team (e.g., Production Manager, Sales Manager, etc.).
➢ A summary of the market(s) served and any adjustments to accommodate for disaster related impacts.
➢ A schedule of owner’s equity invested in the businesses and any new debt incurred prior to one year from the date of application (the debt summary should include the name of the source, the amount borrowed, loan terms, interest rate, current balance, etc.).
➢ A timeline outlining when funds from each source of financing will be expended (including EDLP and non-EDLP sources).
B.5.2 EDLP UNDERWRITING CRITERIA FOR LOANS WITH FORGIVENESS TERMS Eligible EDLP applicants for loans with forgiveness are underwritten in accordance with the following EDLP underwriting criteria.
• Business is located within the jurisdictional boundaries of the City of Chowchilla. • Financial Ratios:
➢ DSCR – an aggregate business DSCR of no lower than 1.0 (includes an aggregate of the DSCR for all non- EDLP debt financing).
➢ Global Cash Flows – an aggregate of business DSCR and personal cash needs are sufficient to cover personal operating expenses including a personal DSCR of no lower than 1.0.
➢ Net Income (after taxes and interest) sufficient to meet DSCR requirements outlined above.
• The Administrator will work closely with the eligible businesses to ensure they understand the requirements of the EDLP and the benefits of participating.
B.6 DETERMINATION OF LOAN AMOUNTS
EDLP loan with forgiveness terms will comply with HUD and/or HCD regulations and guidelines as outlined in NOFA Appendix M and other written documentation provided by HUD and/or the HCD.
B.7 DETERMINATION OF LOAN TERM
EDLP loan with forgiveness terms will comply with HUD and/or HCD regulations and guidelines as outlined in NOFA Appendix M and other written documentation provided by HUD and/or the HCD.
B.8 DETERMINATION OF LOAN INTEREST RATE
EDLP loan with forgiveness terms will comply with HUD and/or HCD regulations and guidelines as outlined in NOFA Appendix M and other written documentation provided by HUD and/or the HCD. It is anticipated that loans with forgiveness terms will be zero percent (0%) for the specified term of the loan unless otherwise specified by the HCD.
B.9 LOAN DISBURSEMENT – LOANS WITH FORGIVENESS TERMS
Loan disbursement for loans with forgiveness terms will be in accordance with HUD and HCD regulations, guidelines, or other written procedures.
Disbursement of loan proceeds will take place only after all conditions have been met and loan documents executed. The procedure for loan disbursement will vary depending upon the purpose of the loan funding as outlined below:
• Operating Expenses and Working Capital – to be disbursed at 50% upon execution of the Promissory Note and 50% after six months in an amount that aligns with the cash flow needs as presented in the pro forma financials provided by the Borrower during the application process and updated as necessary prior to loan closing or due to changing operating conditions following loan closing.
• Furniture, Fixtures & Equipment – to be paid directly to the vendor upon receipt of a valid invoice or to be paid to the borrower upon receipt of a valid invoice and proof of payment (e.g., cancelled check or paid credit card bill)
The Administrator will approve all disbursements and evaluate the sustained viability of the business prior to disbursing future monthly Operating Expense and/or Working Capital advances.
B.10 LOAN MONITORING AND COMPLIANCE FILES – LOANS WITH FORGIVENESS TERMS
Following closing, monitoring files will be set up. Two separate physical and/or electronic loan files shall be maintained. The first is the legal file which holds all the original executed loan documentation. This electronic and/or physical file shall be kept in Lender’s or Administrator’s fireproof vault or cloud-based backup for safekeeping. At a minimum the legal file shall include (if applicable):
• Promissory Note
• Loan Agreement with required CDBG language
• Deed of Trust
• General Security Agreement
• Personal Guaranty
• Corporate Guaranty
• Subordinate Agreement
• Life Insurance Policy and Agreement
• Hazard Insurance Policy and Agreement
• General Resolution
• Certificate of Secretary
• Opinion of Counsel
• Inter-creditor Agreement
• Documentation of Site Control (i.e., lease, deed of trust, etc.) The second is a credit file which will contain the day-to-day administrative records of the loan.
The credit file will include, at a minimum, the loan application and financial information associated with the application, loan memorandum, Lender LAC recommendation, disbursement records, reports of site visits, updated financial information provided by the Borrower, CDBG compliance data and other routine information related to the loan.
Application information should include the following as appropriate:
• Loan Disbursement Schedule
• Map verifying borrower is physically located within program boundaries • Documentation of compliance with federal acquisition requirements, if appropriate (e.g., land purchase)
• Documentation of compliance with federal debarred requirements • Copy of CDBG NEPA documents including Authorization to Use Grant Funds, if required (Original to be maintained in Lender’s Environmental Review Records file) • Copy of Documentation to determine Cost Reasonableness • Documentation to support National Objective/Public Benefit requirements for job retention that shows clear and objective evidence that jobs will be lost without CDBG assistance. • Signed CDBG Documents:
➢ Loan Certification Form
➢ Job Tracking Form (demonstrating CDBG compliance with LMI job creation/retention) ➢ No Conflict-of-Interest Certification
➢ No Job Anti-Pirating Certification
➢ Income Certification forms (including Part 5 if required or other required income certification documentation)
B.11 LOAN SERVICING – LOANS WITH FORGIVENESS TERMS
B.11.1 Loan Servicing Agent
Loan servicing will be conducted by the Administrator with the Lender.
B.11.3 Loan Servicing And Document Collections Procedures Once the loan is closed, the Borrower is entered into a forgivable loan servicing system. EDLP loan with forgiveness terms will be serviced as follows:
• Administrator to secure evidence of purchase and payment for FF&E purchased with EDLP funds for review and comparison to loan application documents and budgets to validate cost reasonableness and CDBG compliance (e.g., NEPA, Prevailing Wage, etc.).
If in noncompliance, Administrator and Lender will determine if corrective action is required and implement corrective action if necessary.
• Borrower to provide the following to the Administrator for review by the 15th of the month following the close of the previous month:
➢ P&L and Balance Sheet or a P&L, A/P Aging and A/R Aging statements. ➢ An updated Debt Schedule.
➢ Payroll records.
Once the loan is closed, the Administrator will monitor the loan to maintain the loan records in compliance with the Program objectives and CDBG guidelines. A servicing and documentation system will be maintained with a file for each borrower.
B.12 ONGOING MONITORING
Ongoing monitoring of loans with forgiveness terms will be handled as outlined above and in Section A.11 and A.12. Any significant variances will be reported to the LAC for further direction.
B.12.1 Forgiveness Monitoring, Compliance, and Reporting The guidelines for loan forgiveness monitoring and reporting will be refined upon receipt of final guidance and approval by the HCD.
B.12.2 Forgiveness Monitoring
Following loan closing the Administrator will collect and review the information outlined in Section B.10 monthly. Following the review, the Administrator will meet as necessary with Borrower either in person or via video conference to discuss current conditions and any adjustments that may be needed, or additional technical assistance provided. • If additional technical assistance is needed the Borrower will be connected with appropriate resources to assist them with this need.
• If Revenues and Operating Expense and Work Capital expenditures are in alignment with pro forma financial and cash flow projections (or if reasonable adjustments are warranted), Administrator to authorize Lender to disburse EDLP funds to support the next month’s Operating Expense and Working Capital allocation as per the pro formal financial and cash flow projections (with reasonable adjustments if warranted). • If Revenues and Operating Expense and Work Capital expenditures are NOT in alignment with pro forma financial and cash flow projections and there is evidence that the business will not be able to continue to sustain operations or retained the projected number of jobs, Administrator will discuss the situation with the Lender and make a determination to implement one of the following actions as appropriate:
➢ Reduce the amount of EDLP funds disbursed to support the next month’s Operating Expense and Working Capital needs in alignment with the reduced labor costs, etc. ➢ Terminate and write off the loan.
➢ If the Borrower fails to provide the required information by the 15th of the month as outlined above, the loan will be considered in default and all further loan disbursements will be halted until the Borrower is in compliance. If the Borrower fails to bring the loan into compliance in two consecutive months, the loan will be considered in default and the Administrator will develop options and present the loan to the LAC to determine the appropriate action.
B.13 FORGIVENESS COMPLIANCE
The loan will be determined to be forgivable if the Borrower meets the following criteria. • Borrower makes every effort to retain and/or re-create the agreed upon number of jobs for the minimum period designed in Appendix M of the CDBG NOFA, 51% of which were initially filled by LMI individuals and, if turnover occurs, agrees to make these positions available to an LMI individual.
• Borrower uses EDLP funds for eligible uses of funds as outlined in Section A.3, in accordance with the projects Sources and Uses Statement submitted as part of the loan application and in compliance with CDBG cost reasonableness requirements. • Provides the required monthly financial and payroll information monthly by the 15th of the month following the close of the previous month.
• Meets with the Administrator monthly via telephone or video conference to review financial performance, business needs, etc. for the term of the loan.
The EDLP funds loaned to the point will also be forgiven If one or more of the following occurs:
• The Borrower ceases business operations prior to the end of the loan term. • A determination is made between the Borrower, the Lender, the Administrator, and the LAC that every effort has been made to retain and/or re-create the agreed upon number of jobs but is unable to do so due to circumstances beyond the control of the Borrower (e.g., recurring disaster related closures or reduced operations due to government mandates, inability to find qualified employees to fill vacant positions, etc.).
B.14 FORGIVENESS REPORTING
Program reporting will conform to CDBG job retention reporting requirements including maintenance of Income Certification forms and payroll records for a minimum period of three (3) months for submission to HCD to certify job retention. Additional documentation will be provided if circumstances arise that result in the business’ inability to retain the projected number of jobs.
All other reporting will comply with HCD semi- annual and annual reporting requirements.
REPORT TO THE CITY COUNCIL
Item 6.1
CLICK HERE
TO RETURN TO
THE AGENDA
Meeting of: April 22, 2025
AGENDA SECTION: New Business
SUBJECT: Presentation of the City’s Fiscal Year 2023-2024 Financial Statement Audit PREPARED BY: Abigail Zurita, Fiscal Manager
ATTACHMENTS: PDF version of the Audit
Audit Communication Letter
Management Communication Letter
PDF Version of the Single Audit Report
REVIEWED BY
ADMINISTRATOR ☒ REVIEWED BYATTORNEY ☒ REVIEWED BY FINANCE ☐ RECOMMENDATION:
Accept the FY 2023/2024 audit as presented.
BACKGROUND:
Annually, the City has a financial statement audit performed by an independent audit firm which is presented to Council for acceptance.
The Final version of the audit is attached with all signatures on reports. We have bound copies for the presentation. The Audit Communication and Management Communication letters are also attached which has communication from the audit firm to management and Council. The Single Audit Report provides information on Federal Grant monies spent, Internal Controls and Compliance but does not provide an opinion on them.
The FY 2023/2024 audit was performed by Price Paige & Company, Inc. Joshua Giosa, the Managing Partner of Price Paige & Company oversaw the audit and Anthony Gonzales, the Audit Manager, will be presenting the audit to Council.
REASON FOR RECOMMENDATION:
The FY 2023/2024 audit has received a “clean”/ unmodified opinion, which is the best opinion you can receive. There were no findings and minimal journal entries. Accepting the results means that Council understands the results of the audit.
FISCAL IMPACT:
None
ALTERNATIVES:
Don’t accept the audit
ACTIONS FOLLOWING APPROVAL:
Any journal entries proposed by the auditors will be uploaded to our system. The books for Fiscal Year 2023/2024 will be formally closed.
City of Chowchilla | CA
Financial Statements
For the Year Ended June 30, 2024
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Financial Statements
TABLE OF CONTENTS
PAGE
Independent Auditor’s Report ............................................................................................................................................ 1 Management’s Discussion and Analysis ............................................................................................................................. 5 Basic Financial Statements:
Government-Wide Financial Statements:
Statement of Net Position .......................................................................................................................................... 15 Statement of Activities ............................................................................................................................................... 16 Fund Financial Statements:
Governmental Funds:
Balance Sheet ....................................................................................................................................................... 18 Reconciliation of the Governmental Funds Balance Sheet to the Government-Wide Statement of Net Position ................................................................................................... 19 Statement of Revenues, Expenditures and Changes in Fund Balances ............................................................... 20 Reconciliation of the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances to the Government-Wide Statement of Activities ............................................ 21 Proprietary Funds:
Statement of Net Position .................................................................................................................................... 22 Statement of Revenues, Expenses and Changes in Net Position ......................................................................... 23 Statement of Cash Flows ...................................................................................................................................... 24 Fiduciary Funds:
Statement of Fiduciary Net Position .................................................................................................................... 26 Statement of Changes in Fiduciary Net Position .................................................................................................. 27 Notes to the Basic Financial Statements ............................................................................................................................ 29 CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Financial Statements
TABLE OF CONTENTS (Continued)
PAGE
Required Supplementary Information:
Budgetary Comparison Schedules:
General Fund ............................................................................................................................................................... 67 CDBG Grants Special Revenue Fund ............................................................................................................................ 68 Impact Fees Special Revenue Fund ............................................................................................................................. 69 Measure N Special Revenue Fund ............................................................................................................................... 70 Notes to the Budgetary Comparison Schedules .......................................................................................................... 71 Cost-Sharing Multiple-Employer Defined Benefit Pension Plan:
Schedule of the City’s Proportionate Share of Net Pension Liability (Asset) .............................................................. 72 Schedule of Contributions ........................................................................................................................................... 73 Supplementary Information:
Nonmajor Special Revenue Funds:
Combining Balance Sheet ............................................................................................................................................ 75 Combining Statement of Revenues, Expenditures and Changes in Fund Balances .................................................... 77 Nonmajor Enterprise Funds:
Combining Statement of Net Position ........................................................................................................................ 79 Combining Statement of Revenues, Expenses and Changes in Net Position .............................................................. 80 Combining Statement of Cash Flows ........................................................................................................................... 81 Internal Service Funds:
Combining Statement of Net Position......................................................................................................................... 83 Combining Statement of Revenues, Expenses and Changes in Net Position .............................................................. 84 Combining Statement of Cash Flows .......................................................................................................................... 85 Custodial Funds:
Combining Statement of Fiduciary Net Position ......................................................................................................... 86 Combining Statement of Changes in Fiduciary Net Position ....................................................................................... 87 1 INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and City Council
City of Chowchilla, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Chowchilla, California (the City), as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2024, and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
2 Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions.
Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
Exercise professional judgment and maintain professional skepticism throughout the audit. Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed. Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, budgetary comparison schedules, schedule of the City’s proportionate share of the net pension liability, and schedule of contributions, as noted on the table of contents, be 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 Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The accompanying combining and individual nonmajor fund financial statements are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic 3 financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial statements and the schedule of expenditures of federal awards are fairly stated, in all material respects, in relation to the basic financial statements as a whole.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated March 25, 2025, on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.
Clovis, California
March 25, 2025
4 MANAGEMENT’S DISCUSSION AND ANALYSIS
CITY OF CHOWCHILLA | JUNE 30, 2024
Management’s Discussion and Analysis
5 As management of the City of Chowchilla (the City), we offer readers of the City’s financial statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2024. We encourage readers to consider the information presented here in conjunction with information that is included within the financial statements.
FINANCIAL HIGHLIGHTS
The assets of the City exceeded its liabilities as of June 30, 2024 by $78,232,608. Of this amount, unrestricted net position of $(2,904,235) may be used to meet the City’s ongoing obligations to citizens and creditors. As of June 30, 2023, the assets and deferred outflows of the City exceeded its liabilities and deferred inflows by $69,133,386 with unrestricted deficit net position totaling $(2,152,143).
Total net position increased by $9,099,222 during the year ended June 30, 2024. Net position associated with governmental activities increased by $4,739,302 while net position associated with business-type activities increased by $4,359,920. For the year ended June 30, 2023, total net position decreased by $471,149 with net position associated with governmental activities decreasing by $1,943,310 and net position associated with business-type activities increasing by $1,472,161.
As of the close of the current fiscal year, the City’s governmental funds reported combined ending fund balances of $31,435,992, an increase of $2,825,146 compared with the prior year. Of this amount, $11,666,447 is available for spending and $19,769,545 is restricted or otherwise designated for specific future uses. For the year ended June 30, 2023, the City’s governmental funds had combined ending fund balances of $28,610,846, with $11,255,284 being available for spending and $17,355,562 restricted for specific future uses. The combined ending fund balances as of June 30, 2023 represented an increase of $89,609 over the June 30, 2022 combined ending fund balances.
At the end of the current fiscal year, the fund balance for the general fund was $14,307,581 or 148 percent of general fund operating expenditures for the year ended June 30, 2024. The general fund’s fund balance increased by $380,996 for the year ended June 30, 2024. At the end of the prior fiscal year, the fund balance of the general fund was $13,926,585 or 125 percent of that year’s general fund operating expenditures. The general fund’s fund balance increased by $1,393,597 during the prior year.
The City’s total debt obligations (excluding post-retirement benefits) decreased by $565,253. This was attributable to not issuing any new debt in FY 2024 and making our scheduled principal payments on pre-existing debt. During the prior year, total debt obligations decreased by $946,995.
OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis are intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements are comprised of three components: 1) government-wide financial statements, 2) fund financial statements and 3) notes to the basic financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves.
Government-wide financial statements. The government-wide financial statements are designed to provide readers with a broad overview of the City’s finances, in a manner similar to a private-sector business.
The Statement of Net Position presents information on all of the City’s assets and liabilities, with the difference between the two reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating.
The Statement of Activities presents information showing how the City’s net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, CITY OF CHOWCHILLA | JUNE 30, 2024
Management’s Discussion and Analysis
6 regardless of the timing of related cash flows. Thus, revenue and expense are reported in this statement for some items that will result in cash flows in future fiscal periods.
Both of the government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenue (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, public safety, highways and streets, culture and recreation, community development and other charges. The business-type activities of the City include water, sewer, storm drain and solid waste disposal systems, as well as airport activities.
Fund financial statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into three categories: governmental funds, proprietary funds and fiduciary funds.
Governmental funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near term inflows and outflows of spendable resources, as well as spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the City’s near-term financing decisions. Both the Governmental Funds Balance Sheet and the Governmental Funds Statement of Revenue, Expenditures and Changes in Fund Balance provide reconciliations to facilitate this comparison between the two.
The City maintains 57 individual governmental funds. Many funds are grouped together by purpose or type for financial reporting purposes. There are 17 governmental funds presented for financial statement purposes. Information is presented separately in the Governmental Funds Balance Sheet and in the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balance for the general fund, which is considered a major fund, three special revenue funds, one debt service fund and one capital projects fund which are presented separately for the purpose of consistency.
Data from the other eleven special revenue funds are combined into a single, aggregated presentation. Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements elsewhere in this report.
The City adopts an annual budget for its general fund and all special revenue funds. Budgetary comparison statements have been provided for the general fund and the major special revenue funds to demonstrate compliance with the 2023/2024 budget.
Proprietary funds. The City maintains two different types of proprietary funds: enterprise funds and internal service funds. Enterprise funds are used to report the same functions presented as business-type activities in the governmentwide financial statements. The City maintains five individual enterprise funds. Information is presented separately in the proprietary Statement of Net Position and the proprietary Statement of Revenues, Expenses and Changes in Net Position for all five enterprise funds.
An internal service fund is used to accumulate and allocate costs internally among the City’s various functions. The City uses three internal service funds to account for its fleet maintenance, information technology activities, and employee benefits. These funds costs are allocated amongst all funds that use those services, both governmental and business-type, so the funds themselves are excluded in the government-wide financial statements but are presented separately in the proprietary funds’ financial statements.
CITY OF CHOWCHILLA | JUNE 30, 2024
Management’s Discussion and Analysis
7 Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties outside the City.
Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support the City’s own programs. The accounting used for fiduciary funds is much like that used for proprietary funds.
Notes to the basic financial statements. The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements.
Supplementary information. In addition to the basic financial statements and accompanying notes, this report also presents certain other supplementary information. The combining statements referred to earlier in connection with the nonmajor funds are presented after the basic financial statements.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. As of June 30, 2024, the City’s assets exceeded liabilities by $78,232,608. A significant portion of the City’s net position (48 percent) reflects its investment in capital assets, less any related debt used to acquire those assets that is still outstanding. Capital assets are used to provide services to citizens and they are not available for future spending. Although the investment in capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.
The following schedules represent a summary of the City’s net position and activities for the year ended June 30, 2024, with a comparison to the total net position and activities for the year ended June 30, 2023:
Statements of Net Position
June 30, 2024 and 2023
06/30/2024 06/30/2023 06/30/2024 06/30/2023 06/30/2024 06/30/2023 Assets
Current and other assets 59,434,463 $ 55,781,454 $ 13,856,206 $ 10,063,991 $ 73,290,669 $ 65,845,445 $ Capital assets 28,375,252 23,908,904 27,846,826 24,920,735 56,222,078 48,829,639 Total assets 79,690,358 87,809,715 41,703,032 34,984,726 129,512,747 114,675,084 Deferred Outflows of Resources 5,416,381 4,112,196 606,374 856,727 4,718,570 6,273,108 Liabilities
Long-term liabilities 30,328,418 29,534,189 14,256,044 14,451,940 44,584,462 43,986,129 Other liabilities 6,258,027 4,625,503 3,256,083 907,147 9,514,110 5,532,650 Total liabilities 36,586,445 34,159,692 17,512,127 15,359,087 54,098,572 49,518,779 Deferred Inflows of Resources 2,035,747 1,684,864 215,273 260,280 1,900,137 2,296,027 Net Position
Net investment in capital assets 21,449,118 16,939,336 16,329,830 13,339,486 37,778,948 30,278,822 Restricted 42,956,342 40,690,404 401,553 316,303 43,357,895 41,006,707 Unrestricted (deficit) (8,718,440) (10,754,858) 7,850,623 6,566,297 (2,904,235) (2,152,143) Total net position, restated $ 48,911,300 53,650,602 $ 24,582,006 $ 20,222,086 $ 78,232,608 $ 69,133,386 $ Governmental Business-Type
Activities Totals Activities
CITY OF CHOWCHILLA | JUNE 30, 2024
Management’s Discussion and Analysis
8 Statements of Activities
For the Years Ended June 30, 2024 and 2023
06/30/2024 06/30/2023 06/30/2024 06/30/2023 06/30/2024 06/30/2023 Revenues:
Program revenues:
Charges for services 1,730,098 $ 2,343,716 $ 7,747,101 $ 7,571,247 $ 9,477,199 $ 9,914,963 $ Operating grants and contributions 4,359,869 3,601,808 15,075 45,874 4,374,944 3,647,682 Capital grants and contributions 811,429 1,460,515 1,515,816 457,332 2,327,245 1,917,847 General revenues:
Property taxes 1,434,297 1,335,352 14,237 12,622 1,448,534 1,347,974 Sales taxes 5,782,318 5,239,148 - - 5,782,318 5,239,148 Transient lodging taxes 354,175 379,288 - - 354,175 379,288 Franchises fees 332,692 352,200 - - 332,692 352,200
Documentary stamp 30,165 54,161 - - 30,165 54,161
Motor vehicle-in-lieu - unrestricted 3,316,652 2,991,612 - - 3,316,652 2,991,612 Investment earnings 1,644,794 1,077,017 480,858 147,114 2,125,652 1,224,131 Rental income 111,156 90,194 - - 111,156 90,194
Miscellaneous 248,290 228,787 255,728 289,124 504,018 517,911 Gain/loss on sale of capital assets - - - 827 - 827
Total revenues 20,155,935 19,153,798 10,028,815 8,524,140 30,184,750 27,677,938 Expenses:
General government 1,857,380 2,591,145 - - 1,857,380 2,591,145 Public safety 6,959,231 10,716,952 - - 6,959,231 10,716,952 Highways and streets 2,050,844 2,280,766 - - 2,050,844 2,280,766 Culture and recreation 976,355 1,133,294 - - 976,355 1,133,294 Community development 1,839,003 2,133,767 - - 1,839,003 2,133,767 Interest and fiscal charges 976,980 995,047 - - 976,980 995,047 Water - - 3,432,063 3,899,696 3,432,063 3,899,696
Solid waste - - 2,257,551 2,096,463 2,257,551 2,096,463 Sewer - - 1,834,549 2,089,916 1,834,549 2,089,916
Airport - - 65,570 58,606 65,570 58,606
Storm drain - - 216,635 153,435 216,635 153,435
Total expenses 14,659,793 19,850,971 7,806,368 8,298,116 22,466,161 28,149,087 Transfers (2,137,473) (1,246,137) 2,137,473 1,246,137 - - Changes in net position 3,358,669 (1,943,310) 4,359,920 1,472,161 7,718,589 (471,149) Net position - beginning, as presented 48,911,300 50,854,610 20,222,086 18,749,925 69,133,386 69,604,535 Error correction (see footnote 17) 1,380,633 - - - 1,380,633 - Net position - ending 53,650,602 $ 48,911,300 $ 24,582,006 $ 20,222,086 $ 78,232,608 $ 69,133,386 $ Activities Totals
Governmental Business-Type
Activities
Governmental activities. Governmental activities increased the City’s net position by $3,358,669 (an increase of $5,301,979 compared to the prior year). This was due primarily to the increase in investment interest, property and sales tax funding, and a decrease in overall expenses as a result of the GASB 68 calculation regarding pension obligations.
Business-type activities. Business-type activities increased the City’s net position by $4,359,920 (an increase of $2,887,759 compared to the prior year). This is primarily due to rate increases per the Proposition 218 and grants received for the Sonoma Strom Drain Project. Expenses decreased overall as a result of the GASB 68 calculation regarding pension obligations.
CITY OF CHOWCHILLA | JUNE 30, 2024
Management’s Discussion and Analysis
9 FINANCIAL ANALYSIS OF THE CITY'S FUNDS
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance related legal requirements.
Governmental funds. The purpose of the City’s governmental fund financial statements is to provide information on nearterm inflows, outflows and balances of spendable resources. Such information is useful in assessing the City’s financing requirements. In particular, an unreserved fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year.
As of June 30, 2024, the City’s governmental funds reported combined ending fund balances of $31,435,992, an increase of $2,825,146 in comparison to the prior year. Of this amount, $11,666,447 (37 percent) was unassigned, which is available for spending at the City’s discretion. The remainder of the fund balance is assigned to indicate that it is not available for new spending because it has already been designated to liquidate contracts and purchase orders of the prior period or cover the next year budget deficit ($158,575), committed by the Council ($910,223), restricted by external entities ($17,901,063) or nonspendable because the assets that will not be converted to cash within the next twelve months ($464,698).
The general fund is the City’s chief operating fund. At the end of the current fiscal year, the spendable portion of the fund balance of the general fund was $12,456,379 while the total fund balance was $14,307,581. As a measure of the general fund’s liquidity, it may be useful to compare both the spendable portion of the fund balance and total fund balance to total fund expenditures. Spendable portion of the fund balance represents 129 percent of total general fund operating expenditures, while total fund balance represents 148 percent of the same amount.
The fund balance of the City’s general fund increased by $380,996 during the year ended June 30, 2024. Expenditures decreased by 14% and revenue increased by 13% resulting in an excess of expenditure over revenues of $997,896. There was $1,917,621 transferred from other funds to the general fund, $2,980,449 transferred from the general fund to other funds and $5,150 of proceeds from sale of capital assets.
Major special revenue funds have a combined fund balance of $7,876,351, all of which is restricted by external entities for various activities.
Proprietary funds. The City’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail.
Unrestricted net position of the proprietary funds was $7,883,098 as of June 30, 2024. The total increase in the net position of the proprietary funds was $4,409,326 for the year. Other factors concerning the finances of these funds have already been addressed in the discussion of the City’s business-type activities.
GENERAL FUND BUDGETARY HIGHLIGHTS
The general fund final budgeted expenditures were greater that the original budgeted expenditures by $1,351,468. Actual expenditures were $1,947,303 less than final budgeted expenditures. Final anticipated revenue was $1,539,291 more than original anticipated revenue. Actual total revenue was $370,711 less than the final anticipated revenue. These numbers represent original City budget information and are not necessarily reflective of the activity reported in the budgetary comparison schedules. Management believes this information is the most accurate and useful for the users of the financial statements.
The decrease in actual revenues versus final budgeted revenues is due to not receiving the anticipating funding that was included in the budget. The decrease in actual expenditures versus final budgeted expenditures is due to the timing of projects being completed.
CITY OF CHOWCHILLA | JUNE 30, 2024
Management’s Discussion and Analysis
10 CAPITAL ASSET AND DEBT ADMINISTRATION
Capital assets. The City’s total capital assets for its governmental and business-type activities as of June 30, 2024 amounted to $56,222,078 (net of accumulated depreciation). This investment in capital assets includes land, buildings, improvements, service lines, automobiles, equipment and streetlights. In addition, all sidewalks, bridges and roads within the city limits belong to the City.
City of Chowchilla's Capital Assets
(net of depreciation)
2024 2023 2024 2023 2024 2023
Land $ 766,397 $ 721,926 $ 2,030,152 $ 2,031,405 $ 2,796,549 $ 2,753,331 Construction in progress 4,178,174 5,681,063 4,012,819 1,725,673 8,190,993 7,406,736 Land improvements 259,017 329,994 305,604 342,875 564,621 672,869 Building improvements 5,817,017 4,160,864 3,465,381 2,095,954 9,282,398 6,256,818 Right-to-use leased asset 313,166 18,660 40,999 - 354,165 18,660 SBITA Right to use asset 58,861 51,610 - - 58,861 51,610 Machinery, equipment and vehicles 3,371,421 2,514,360 788,555 921,453 4,159,976 3,435,813 Infrastructure 10,430,427 13,611,199 17,203,316 17,803,375 30,814,515 28,233,802 Total, restated $ 23,908,904 28,375,252 $ 27,846,826 $ 24,920,735 $ 56,222,078 $ 48,829,639 $ Governmental Activities Business-Type Activities Total
Major capital asset events during the year ended June 30, 2024 included the following:
Various infrastructure improvements amounted to $3,645,086.
Additional information on the City’s capital assets can be found in Note 6.
Long-term liabilities. As of June 30, 2024, the City had $39,885,236 in outstanding long-term debt consisting of four revenue bond issues ($17,970,000), two loans from the State of California ($12,157,409), one Pension Obligation Bond ($8,705,000), net unamortized bond premiums/discounts ($488,452) and compensated absences ($564,375). The revenue bonds are obligations of the water, sewer and general fund. Principal payments on the revenue bonds during the year reduced the amount owed by $65,000. There was a $240,449 principal decrease in the loans payable to the State of California for the completion of the City-wide water meter upgrade project which is an obligation of the water fund.
The City’s total debt obligations (including post-retirement benefits) decreased by $868,333. Compensated absences payable increased by $46,073 during the year.
City of Chowchilla's Outstanding Bonds, Leases and Loans 2024 2023 2024 2023 2024 2023
Bonds $ 15,610,000 $ 16,165,000 $ 11,065,000 $ 11,105,000 $ 26,675,000 $ 27,270,000 Leases 322,337 33,241 - 322,337 - 33,241
SBITA liability 19,845 38,745 - 19,845 - 38,745
Loans 9,913,215 9,913,215 2,244,194 2,484,643 12,157,409 12,397,858 Total $ 26,150,201 25,865,397 $ 13,309,194 $ 13,589,643 $ 39,174,591 $ 39,739,844 $ Governmental Activities Business-Type Activities Total
Additional information on the City’s long-term liabilities can be found in Note 8.
CITY OF CHOWCHILLA | JUNE 30, 2024
Management’s Discussion and Analysis
11 ECONOMIC FACTORS AND NEXT YEAR'S BUDGET
The City continues to focus on maintaining a balanced budget and forecasting the needed resources to provide efficient and effective levels of service to the public. The City Council and staff continue to follow a conservative approach to the public’s finances. The increase in property tax revenues (roughly 8%) for FY 23/24 for the City, driven by the construction of more houses, is indeed a significant indicator of economic growth and stability within the City. Various economic outlook indicators in California require Chowchilla and most public agencies in California to look at multi-year budget projections and prepare for possible outcomes of the future. Due to the City Council approving a conservative budget and dedication to building reserve levels the past few years, Chowchilla positioned itself well for any negative economic fluctuations.
This conservative fiscal position does not mean that future goals and objectives are put aside, but rather, that each dollar spent is leveraged to its maximum so that we can continue to aggressively pursue the goals that our community so desperately needs. These needs can be captured in the City’s five Cornerstone Goals:
Provide a safe and secure community.
Strengthen infrastructure and proactively plan for services, finances and processes. Achieve and maintain fiscal reinforcement and growth. Enhance the quality of life and sense of place.
Foster economic development and revenue production.
Specific goals, outcomes, and strategies to reach the outcomes under each of the Cornerstones can be found in the City’s Annual Adopted Budget document under individual department sections.
The City’s budget process, financial policies, and financial metrics are very transparent. This reflects the strategic priorities of the Council and demonstrates accountability to the tax and ratepayers. The City’s budget document meets Government Finance Officers’ Association standards and the City has been awarded the GFOA Distinguished Budget Presentation Award for the last 5 consecutive years.
The biggest economic factor in both the immediate and long-term range has been inflation. The cost of just about everything has increased. This has caused developments to pause because the costs are high to build and interest rates are high for loans. The City is currently working with Century Communities on a residential project that will have roughly 200 homes built. Construction is anticipated to start in FY 2024-25 and be completed in FY 2026-27.
As mentioned above, Chowchilla is seeing some renewed interest in all the community and economic development sectors. We have seen an increase in business license and building permits as a result. Commercial, Industrial and Residential sectors are seeing increased activity. There are multiple residential projects in the works with already approved maps and development agreements in place. AutoZone’s distribution center is anticipated to be completed in FY 2024-25 and will be over 540,000 square feet. This will bring over 300 jobs to our community. With the new and more accepted “work from home” business model, there is a benefit for people to live in Chowchilla where cost of living is reasonable and work in the larger market cities that pay more. The County of Madera has seen this increase in demand as well.
Increased costs are going to be a significant issue to address. Everything is costing more now. Construction costs, supplies, gas, to name a few, have skyrocketed in costs over the last few months and are causing budget and timing issues. The City will be monitoring these issues and forecasting accordingly.
Even though the City issued Pension Obligation Bonds in 2019 to address the significant issue of CalPERS Unfunded Liabilities, there have been new Unfunded Liabilities since then that the City has to keep an eye on. Even when the PERS Investment Portfolio performs at or above expectations, we still see an increase in Unfunded Liabilities because of changes in actuarial assumptions.
CITY OF CHOWCHILLA | JUNE 30, 2024
Management’s Discussion and Analysis
12 Measure N, a 1% district sales tax add-on approved in 2018, is a Public Safety Measure which the funds are used to upgrade and purchase equipment as well as help with recruitment and retention of public safety employees. Retention of current employees due to increases in pension costs is allowed under this measure. This measure has performed very well and has been coming in with more revenue than previously expected. It was voted on again in 2024 and passed, reaffirming the community's support for public safety funding. The FY 2024-25 budget has the use of Measure N monies to help pay for communication upgrades and Phase II of the fire station expansion. All these items have been needed for quite some time and could not have been accomplished without Measure N. We have also used Measure N to hire additional personnel for both the Police and Fire Departments. 13 BASIC FINANCIAL STATEMENTS
14 GOVERNMENT-WIDE FINANCIAL STATEMENTS
CITY OF CHOWCHILLA | JUNE 30, 2024
Statement of Net Position
The notes to the basic financial statements are an integral part of this statement. 15 Governmental Business-Type
Activities Activities Total
ASSETS
Cash and investments $ 11,003,083 29,895,418 $ $ 40,898,501 Restricted cash and investments with fiscal agents 735,802 401,553 1,137,355 Accounts receivable, net 417,668 897,305 1,314,973
Intergovernmental receivables 3,949,227 1,540,711 5,489,938 Leases receivable 93,824 - 93,824
Notes receivable, net 24,202,768 24,202,768 -
Prepaid items 92,399 588 92,987
Prepaid bond insurance 14,882 45,441 60,323
Internal balances 32,475 (32,475) -
Capital assets:
Nondepreciable 4,944,571 6,042,971 10,987,542
Depreciable, net of accumulated
depreciation/amortization 21,803,855 23,430,681 45,234,536 Total assets 41,703,032 87,809,715 129,512,747
DEFERRED OUTFLOWS OF RESOURCES
Contributions to pension plan in current fiscal year 557,459 69,718 627,177 Deferred outflows of resources from pensions 536,656 3,554,737 4,091,393 Total deferred outflows of resources 606,374 4,112,196 4,718,570
LIABILITIES
Accounts payable 1,979,951 2,777,060 4,757,011
Accrued salaries, wages, and benefits 175,656 175,656 - Retainage payable 148,569 159,362 307,931
Deposits 8,106 280,006 288,112
Accrued interest 3,945,745 39,655 3,985,400
Long-term liabilities:
Lease liability due within one year 74,896 7,148 82,044 Long-term debt due within one year 1,223,764 230,300 1,454,064 Lease liability due in more than one year 247,441 34,066 281,507 Long-term debt due in more than one year 24,920,127 13,530,890 38,451,017 Net pension liability 453,640 3,862,190 4,315,830
Total liabilities 17,512,127 36,586,445 54,098,572
DEFERRED INFLOWS OF RESOURCES
Deferred inflows of resources from leases 50,823 - 50,823 Deferred inflows of resources from pensions 215,273 1,634,041 1,849,314 Total deferred inflows of resources 215,273 1,684,864 1,900,137
NET POSITION
Net investment in capital assets 21,449,118 16,329,830 37,778,948 Restricted for:
Highway and streets - 8,256,661 8,256,661
Community development - 26,382,638 26,382,638
Public safety 3,302,001 - 3,302,001
Construction projects - 4,259,151 4,259,151
Debt service 401,553 755,891 1,157,444
Unrestricted 7,850,623 (10,754,858) (2,904,235)
Total net position $ 24,582,006 53,650,602 $ 78,232,608 $ CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Statement of Activities
The notes to the basic financial statements are an integral part of this statement. 16 Operating Capital
Charges for Grants and Grants and Governmental Business-Type Expenses Services Contributions Contributions Activities Activities Total FUNCTIONS/PROGRAMSGovernmental activities:
General government 1,857,380 $ 183,693 $ 13,222 $ - $ (1,660,465) $ - $ (1,660,465) $ Public safety 6,959,231 311,728 379,997 - (6,267,506) - (6,267,506) Highways and streets 2,050,844 446,202 2,524,896 805,400 1,725,654 - 1,725,654 Culture and recreation 976,355 91,143 186,725 - (698,487) - (698,487) Community development 1,839,003 697,332 1,255,029 6,029 119,387 - 119,387 Interest and fiscal charges - 976,980 - - - (976,980) (976,980) Total governmental activities 1,730,098 14,659,793 4,359,869 811,429 (7,758,397) - (7,758,397) Business-type activities:
Water 3,432,063 3,040,796 - 1,515,816 - 1,124,549 1,124,549 Solid waste 2,257,551 2,399,763 5,075 - - 147,287 147,287 Sewer 1,834,549 2,039,471 - - - 204,922 204,922
Airport 65,570 43,823 10,000 - - (11,747) (11,747)
Storm drain 216,635 223,248 - - - 6,613 6,613
Total business-type activities 7,747,101 7,806,368 15,075 1,515,816 - 1,471,624 1,471,624 Total $ 9,477,199 22,466,161 $ 4,374,944 $ 2,327,245 $ (7,758,397) 1,471,624 (6,286,773) General revenues:
Taxes:
Property 1,434,297 14,237 1,448,534Sales 5,782,318 - 5,782,318Transient lodging 354,175 - 354,175Franchise 332,692 - 332,692Other 30,165 - 30,165 Motor vehicle-in-lieu - unrestricted 3,316,652 - 3,316,652 Investment income 1,644,794 480,858 2,125,652
Rental income 111,156 - 111,156
Miscellaneous 248,290 255,728 504,018
Transfers 2,137,473 (2,137,473) -
Total general revenues and transfers 2,888,296 11,117,066 14,005,362 Change in net position 4,359,920 3,358,669 7,718,589
Net position - beginning 48,911,300 20,222,086 69,133,386Error correction (see footnote 17) - 1,380,633 1,380,633Net position - beginning, restated 20,222,086 50,291,933 70,514,019 Net position - ending $ 24,582,006 53,650,602 $ 78,232,608 $ Program Revenues
Net (Expenses) Revenues and
Changes in Net Position
17 FUND FINANCIAL STATEMENTS
CITY OF CHOWCHILLA | JUNE 30, 2024
Governmental Funds Balance Sheet
The notes to the basic financial statements are an integral part of this statement. 18 Other Total
CDBG Impact Debt Capital Governmental Governmental
General Grants Fees Measure N Service Projects Funds Funds ASSETS
Cash and investments $ 12,590,723 $ 182,816 $ 4,648,534 $ 2,822,502 $ 40,374 $ 87,759 $ 9,352,037 $ 29,724,745 Restricted cash and investments with fiscal agents - - - 735,802 - - 735,802 - Accounts receivable, net 417,123 - - - - - 417,123 -
Intergovernmental receivables 874,989 137,071 515,801 - 187,990 - 2,233,376 3,949,227 Leases receivable 93,824 - - - - - - 93,824
Notes receivable, net 22,569,756 - - - - 1,633,012 - 24,202,768 Due from other funds 901,565 - - - - - 901,565 -
Prepaid expenses 58,035 - - 5,128 - - 12,152 75,315
Prepaid bond insurance - - - - 14,882 - - 14,882
Advances to other funds 389,383 - - - - - - 389,383
Total assets $ 22,889,643 15,325,642 $ 4,648,534 $ 3,343,431 $ 791,058 $ 275,749 $ 13,230,577 $ 60,504,634 $
LIABILITIES
Accounts payable 711,901 $ 4,688 $ - $ 41,430 $ 3,700 $ 238,325 $ 955,331 $ 1,955,375 $ Retainage payable 69,401 - - - - 37,424 41,744 148,569
Deposits 8,106 - - - - - - 8,106Due to other funds - - - - - 780,735 - 780,735 Advances from other funds - - 389,383 - - - - 389,383
Total liabilities 4,688 789,408 389,383 41,430 3,700 275,749 1,777,810 3,282,168
DEFERRED INFLOWS OF RESOURCES
Deferred inflows from lease proceeds - 50,823 - - - - - 50,823 Unavailable revenues 177,830 22,569,756 - - - - 2,988,065 25,735,651 Total deferred inflows of resources 22,569,756 228,653 - - - - 2,988,065 25,786,474 FUND BALANCESNonspendable:
Prepaid expenses 58,035 - - 5,128 - - 12,152 75,315
Advances to other funds 389,383 - - - - - - 389,383
Restricted for:
Highway and streets - - - - - - 7,368,983 7,368,983
Community development 315,199 - - - - - 1,864,671 2,179,870 Public safety - - - 3,302,001 - - - 3,302,001
Construction projects - - 4,259,151 - 35,167 - - 4,294,318 Debt service - - - - 755,891 - - 755,891
Committed to:
Emergency contingency 910,223 - - - - - - 910,223
Assigned to:
Public safety - 94,453 - - - - - 94,453
Community development - 240,533 - - - - - 240,533
Subsequent fiscal year budget deficit 158,575 - - - - - 158,575 - Unassigned - 12,456,379 - (5,128) (3,700) - (781,104) 11,666,447 Total fund balances 14,307,581 315,199 4,259,151 3,302,001 787,358 - 8,464,702 31,435,992 Total liabilities, deferred inflows of resources, and fund balances $ 22,889,643 15,325,642 $ 4,648,534 $ 3,343,431 $ 791,058 $ 275,749 $ 13,230,577 $ 60,504,634 $ Special Revenue
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Reconciliation of the Governmental Funds Balance Sheet to the Government-Wide Statement of Net Position The notes to the basic financial statements are an integral part of this statement. 19 Total fund balances - governmental funds $ 31,435,992 27,876,179
Contributions to the pension plan subsequent to the measurement date 523,827 Deferred outflows of resources from pensions 3,337,658
Deferred inflows of resources from pensions (1,545,257) Bonds, loans payable, compensated absences, lease related liabilities (25,605,632) Net pension liability (3,643,356)
Leases payable (196,242)
(3,945,745)
25,735,651
(322,473)
Net position of governmental activities $ 53,650,602
Amounts reported for governmental activities in the statement of net position are different because:
Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the governmental funds. Those liabilities consist of:
Internal service funds are used by management to charge the costs to individual funds.
These 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 net position.
Interest payable on long-term debt does not require the use of current financial resources. Therefore, interest payable is not reported as a liability in the governmental funds balance sheet.
Other long-term assets are not available to pay for current period expenditures and, therefore, are deferred in the funds.
Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the governmental funds.
Pension related deferrals are reported as deferred outflows and inflows of resources on the statement of net position:
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances The notes to the basic financial statements are an integral part of this statement. 20 Other Total
CDBG Impact Debt Capital Governmental Governmental
General Grants Fees Measure N Service Projects Funds Funds
REVENUES
Taxes $ - 4,971,727 $ - $ 2,962,014 $ $ - $ - $ 7,933,741 - $ Licenses and permits 525,483 - - - - - 525,483 -
Fines and penalties 204,848 - - - - - 204,848 -
Intergovernmental revenues 3,798,136 526,634 - - 661,121 - 4,287,926 9,273,817 Use of money and property 591,418 6,199 167,755 133,225 101,371 309,925 - 1,309,893Charges for services 399,963 13,593 262,158 - - 327,468 - 1,003,182 Miscellaneous 170,988 - - 511 - - 5,846 177,345
Total revenues 10,662,563 546,426 429,913 3,095,750 101,371 661,121 4,931,165 20,428,309 EXPENDITURESCurrent:
General government 1,219,185 - - 1,645 - - 5,543 1,226,373 Public safety 4,212,923 - 334 1,098,988 - - 3,047 5,315,292 Highways and streets - - 2,440 - - - 1,376,149 1,378,589 Culture and recreation 739,441 - 4,681 - - - - 744,122
Community development 891,153 309,277 - - - - 3,153 1,203,583 Capital outlay 4,228 2,574,502 25,088 - - 851,089 1,313,735 4,768,642 Debt service:
Principal 23,439 - - - 555,000 - 3,644 582,083
Interest 4,024 - - - 687,388 - 1,522 692,934
Total expenditures 313,505 9,664,667 32,543 1,100,633 1,242,388 851,089 2,706,793 15,911,618 Excess (deficiency) of revenues over (under) expenditures 997,896 232,921 397,370 1,995,117 (1,141,017) (189,968) 2,224,372 4,516,691
OTHER FINANCING SOURCES (USES)
Transfers in 20,685 1,917,621 - 1,397,805 - 189,337 1,284,778 4,810,226 Transfers out (2,980,449) (203,341) (481,606) (1,892,817) - (1,389,486) - (6,947,699) Gain (loss) on sale of assets 5,150 - - - - - - 5,150Insurance recoveries 175,136 - - - - - 175,136 - Proceeds from long-term debt 265,642 - - - - - - 265,642 Total other financing sources (uses) (616,900) (182,656) (481,606) (1,892,817) 1,397,805 189,337 (104,708) (1,691,545) Net change in fund balances 50,265 380,996 (84,236) 102,300 256,788 (631) 2,119,664 2,825,146 Fund balances - beginning 264,934 13,926,585 4,343,387 3,199,701 530,570 631 6,345,038 28,610,846 Fund balances - ending $ 315,199 14,307,581 $ 4,259,151 $ 3,302,001 $ 787,358 $ - $ 8,464,702 $ 31,435,992 $ Special Revenue
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Reconciliation of the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances to the Government-Wide Statement of Activities The notes to the basic financial statements are an integral part of this statement. 21 Net change in fund balances - total governmental funds $ 2,825,146 Capital outlay 4,370,415
Depreciation expense (1,581,160)
(11,061)
Repayment of the principal of long-term debt 555,000
Amortization on bond discounts and premiums (3,452)
(283,580)
(1,876,343)
506,341
(953,851)
(188,786)
Change in net position of governmental activities 3,358,669 $ Amounts reported for governmental activities in the statement of activities are different because:
The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of issuance costs, discounts, and similar items when debt is first issued, whereas these amounts are deferred and amortized in the statement of activities. This amount is the net effect of these differences in the treatment of long-term debt and related items:
Accrued interest payable on long-term debt is reported in the government-wide statement of activities, but does not require the use of current financial resources. This amount represents the change in accrued interest payable not reported in governmental funds.
The changes in net position of certain activities of the internal service funds is reported within governmental activities.
Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds.
The distribution of housing loans and corresponding payments that were recognized in the governmental funds are not recognized in the statement of activities.
Governmental funds report capital outlays as expenditures. However, in the statement of activities, the costs of these assets are allocated over their estimated useful lives and reported as depreciation expense. In the current period, these amounts are:
The net effect of various miscellaneous transactions involving capital assets (i.e., sales and donations) is to increase (decrease) net position.
Changes to net pension liability and pension related deferred outflows and inflows of resources do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds.
CITY OF CHOWCHILLA | JUNE 30, 2024
Proprietary Funds
Statement of Net Position
The notes to the basic financial statements are an integral part of this statement. 22 Governmental
Activities
Other Internal
Solid Enterprise Service
Water Waste Sewer Storm Drain Funds Total Funds
ASSETS
Current assets:
Cash and investments $ 3,559,874 $ 759,538 $ 4,373,978 $ 2,068,594 $ 241,099 $ 11,003,083 $ 170,673 Restricted cash and investments with fiscal agents 289,532 112,021 - - 401,553 - - Accounts receivable, net 411,156 250,020 212,923 23,206 897,305 - 545 Intergovernmental receivables - - 30,907 1,497,911 11,893 1,540,711 - Prepaid items 196 196 196 - - 588 17,084
Prepaid bond insurance - 44,734 707 - - 45,441 -
Total current assets 1,009,754 4,305,492 4,730,732 3,589,711 252,992 13,888,681 188,302 Noncurrent assets:
Capital assets:
Nondepreciable - 2,171,982 1,380,954 2,037,084 452,951 6,042,971 172,862 Depreciable, net of accumulated depreciation - 14,182,890 5,681,724 1,634,580 304,661 21,803,855 326,211 Total noncurrent assets - 16,354,872 7,062,678 3,671,664 757,612 27,846,826 499,073 Total assets 1,009,754 20,660,364 11,793,410 7,261,375 1,010,604 41,735,507 687,375
DEFERRED OUTFLOWS OF RESOURCES
Contributions to pension plan in current fiscal year - 42,864 21,908 3,444 1,502 69,718 33,632 Deferred outflows of resources from pensions - 314,632 189,053 23,158 9,813 536,656 217,079 Total deferred outflows of resources 357,496 - 210,961 26,602 11,315 606,374 250,711
LIABILITIES
Current liabilities:
Accounts payable 148,878 1,290,083 44,865 1,292,685 549 2,777,060 24,576 Accrued salaries, wages, and benefits - - - - - - 175,656 Retainage payable - 96,193 - 63,169 - 159,362 -
Deposits - 280,006 - - - 280,006 -
Due to other funds - - - - - - 120,830
Accrued interest - 28,898 10,757 - - 39,655 -
Compensated absences - - - - - - 383,919
Subscription liability - - - - - - 19,845
Lease liabilities - 7,148 - - - 7,148 28,935
Long-term debt - 185,300 45,000 - - 230,300 -
Total current liabilities 148,878 1,887,628 100,622 1,355,854 549 3,493,531 753,761 Noncurrent liabilities:
Compensated absences - - - - - 180,456 -
Net pension liability 278,906 142,552 - 22,408 9,774 453,640 218,834 Lease liabilities 34,066 - - - - 34,066 51,199
Long-term debt - 10,565,081 2,965,809 - - 13,530,890 -
Total noncurrent liabilities - 10,878,053 3,108,361 22,408 9,774 14,018,596 450,489 Total liabilities 148,878 12,765,681 3,208,983 1,378,262 10,323 17,512,127 1,204,250
DEFERRED INFLOWS OF RESOURCES
Deferred inflows of resources from pensions 128,083 - 73,768 9,424 3,998 215,273 88,784 Total deferred inflows of resources 128,083 - 73,768 9,424 3,998 215,273 88,784
NET POSITION (DEFICIT)
Net investment in capital assets 7,848,685 4,051,869 - 3,671,664 757,612 16,329,830 470,138 Restricted:
Debt service 289,532 112,021 - - 401,553 - -
Unrestricted (14,121) 860,876 4,557,730 2,228,627 249,986 7,883,098 (825,086) Total net position (deficit) $ 860,876 8,124,096 $ 8,721,620 $ 5,900,291 $ 1,007,598 $ 24,614,481 $ (354,948) 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 (32,475) Net position of business-type activities $ 24,582,006
Business-Type Activities - Enterprise Funds
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Proprietary Funds
Statement of Revenues, Expenses and Changes in Net Position The notes to the basic financial statements are an integral part of this statement. 23 Governmental
Activities
Other Internal
Solid Enterprise Service
Water Waste Sewer Storm Drain Funds Total Funds
Operating revenues:
Charges for services $ 3,040,796 $ 2,399,763 $ 2,039,471 223,248 $ 43,823 $ 7,747,101 $ 902,252 Miscellaneous 154,295 45,638 49,065 4,731 1,999 255,728 818 Total operating revenues 2,445,401 3,195,091 2,088,536 227,979 45,822 8,002,829 903,070 Operating expenses:
Personnel services 789,926 436,675 - 53,416 22,563 1,302,580 611,942 Materials, supplies and services 1,756,327 2,257,551 944,107 117,088 16,294 5,091,367 450,767 Depreciation and ammortization 500,037 - 308,715 46,131 26,713 881,596 77,757 Total operating expenses 2,257,551 3,046,290 1,689,497 216,635 65,570 7,275,543 1,140,466 Operating income (loss) 148,801 187,850 399,039 11,344 (19,748) 727,286 (237,396) Nonoperating revenues (expenses):
Use of money and property 121,210 29,776 239,095 82,106 8,671 480,858 - Taxes - - - 14,237 - 14,237 -
Grants - capital - - 1,515,816 - 10,000 1,525,816 -
Grants - operating - 5,075 - - - 5,075 -
Interest expense - (344,246) (137,173) - - (481,419) (3,782) Total nonoperating revenues (expenses) 34,851 (223,036) 101,922 1,597,922 32,908 1,544,567 (3,782) 222,701 (74,235) 500,961 1,609,266 13,160 2,271,853 (241,178) Transfers in - 2,032,075 - 105,398 - 2,137,473 -
Change in net position 222,701 1,957,840 500,961 1,714,664 13,160 4,409,326 (241,178) Net position - beginning, as previously presented 638,175 6,166,256 8,220,659 - 5,180,065 (113,770) - - - 4,185,627 - (4,185,627)
Net position (deficit) - beginning, restated 638,175 6,166,256 8,220,659 4,185,627 994,438 (113,770) Net position (deficit) - ending $ 860,876 8,124,096 $ 8,721,620 $ 5,900,291 $ 1,007,598 $ (354,948) $ Adjustment for the net effect of the current year activity between the internal service funds and the enterprise funds (49,406) Changes in net position of business-type activities 4,359,920 $ Business-Type Activities - Enterprise Funds
Income (loss) before transfers
Change within financial reporting entity (nonmajor to
major)
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Proprietary Funds
Statement of Cash Flows
The notes to the basic financial statements are an integral part of this statement. 24 Governmental
Activities
Other Internal
Solid Storm Enterprise Service
Water Waste Sewer Drain Funds Total Funds
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers and users $ 2,389,686 2,905,683 $ 2,032,403 $ 223,382 43,823 $ 7,594,977 $ 901,771 $ Payments to suppliers (2,374,250) (474,868) (805,261) 1,042,952 (25,831) (2,637,258) (442,894) Payments to employees (620,116) - (353,366) (39,638) (16,522) (1,029,642) (476,934) Other operating revenues 154,295 45,638 49,065 4,731 255,728 1,999 818 61,074 1,964,994 922,841 1,231,427 3,469 4,183,805 (17,239)
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES
Operating grants received - 5,075 - - - 5,075 -
Transfer from other funds 2,032,075 - 105,398 - 2,137,473 - - Loans from other funds - - - - - - 97,760
Taxes received - - - - 14,237 14,237 -
5,075 2,032,075 - 105,398 14,237 2,156,785 97,760
FINANCING ACTIVITIES
Principal paid (261,699) - (43,003) - - (304,702) -
Interest paid (339,012) - (132,127) - - (471,139) -
Capital grants received - - - 28,722 192,747 221,469 -
Leases paid 41,214 - - - - 41,214 43,111
Acquisition of capital assets - (2,133,445) (111,782) (1,674,242) - (3,919,469) (161,975) - (2,692,942) (286,912) (1,481,495) 28,722 (4,432,627) (118,864)
CASH FLOWS FROM INVESTING ACTIVITIES
121,210 29,776 239,095 82,106 8,671 480,858 -
121,210 29,776 239,095 82,106 8,671 480,858 -
95,925 1,425,337 875,024 (62,564) 55,099 2,388,821 (38,343) 663,613 2,424,069 3,610,975 2,131,158 186,000 9,015,815 209,016 Cash and cash equivalents - ending $ 759,538 3,849,406 $ 4,485,999 $ 2,068,594 $ 241,099 $ 11,404,636 $ 170,673 $ Business-Type Activities - Enterprise Funds
Net cash provided by (used for) operating activities
activities
Interest received
Net cash provided by (used for) noncapital financing
Net cash provided by (used for) capital and
Net increase (decrease) in cash and cash equivalents
CASH FLOWS FROM CAPITAL AND RELATED
related financing activities
Cash and cash equivalents - beginning
Net cash provided by (used for) investing activities
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Proprietary Funds
Statement of Cash Flows
(Continued)
The notes to the basic financial statements are an integral part of this statement. 25 Governmental
Activities
Other Internal
Solid Storm Enterprise Service
Water Waste Sewer Drain Funds Total Funds
Operating income (loss) $ 148,801 $ 187,850 $ 399,039 11,344 $ (19,748) $ 727,286 $ (237,396) Depreciation 500,037 308,715 - 46,131 26,713 881,596 77,757 (Increase) decrease in:
Accounts receivable (141,263) (10,077) (7,068) 134 (158,274) - (481) Prepaid expenses (196) (196) (196) - - (588) (21,874)
Net pension liability 57,572 - 267 6,618 3,135 67,592 73,140 Deferred outflows of resources from pensions 134,548 104,657 - 8,036 3,112 250,353 67,002 Increase (decrease) in:
Accounts payable and other liabilities 1,281,655 (116,503) 139,042 1,160,040 (9,537) 2,454,697 (16,183) Deposits 6,150 - - - - 6,150 -
Compensated absences - - - - - - 46,073
Deferred inflows of resources from pensions (22,310) - (21,615) (876) (206) (45,007) (5,277) $ 61,074 1,964,994 $ 922,841 $ 1,231,427 $ 3,469 $ 4,183,805 $ (17,239) $ Business-Type Activities - Enterprise Funds
Reconciliation of operating income (loss) to net
cash provided by (used for) operating activities:
Adjustments to reconcile operating income
(loss) to net cash provided by (used for)
operating activities:
Net cash provided by (used for) operating activities
CITY OF CHOWCHILLA | JUNE 30, 2024
Fiduciary Funds
Statement of Fiduciary Net Position
The notes to the basic financial statements are an integral part of this statement. 26 Successor
Agency Private
Custodial Purpose
Funds Trust Fund
ASSETS
Cash and investments (in City investment pool) $ 1,067,475 1,787,196 $ Restricted cash with fiscal agents - 699,281
Accounts receivable (net) - 16,734
Prepaid bond insurance 35,703 -
Long term receivables 43,750 -
Total assets 1,146,928 2,503,211
LIABILITIES
Accounts payable 1,609 3,723
Accrued interest 52,463 -
Long-term debt due within one year 285,000 -
Long-term debt due in more than one year 4,269,691 -
Total liabilities 4,608,763 3,723
NET POSITION
Restricted for:
Individuals, organizations, and other governments - 2,499,488 Redevelopment agency dissolution (3,461,835) -
Total net position $ (3,461,835) 2,499,488 $
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Fiduciary Funds
Statement of Changes in Fiduciary Net Position
The notes to the basic financial statements are an integral part of this statement. 27 Successor
Agency Private
Custodial Purpose
Funds Trust Fund
ADDITIONS
Taxes $ 531,005 - $
Property tax collections - 1,056,612
Investment earnings - 160,078
Proceeds from sale of property 533,144 -
Total additions 1,064,149 1,216,690
DEDUCTIONS
Payments to bondholders - 1,460,760
Administrative expenses 107,365 122,401
Interest 117,707 -
Total deductions 225,072 1,583,161
Change in fiduciary net position (366,471) 839,077
Net position (deficit) - beginning (4,300,912) 2,865,959 Net position (deficit) - ending $ (3,461,835) 2,499,488 $ 28 NOTES TO THE BASIC FINANCIAL STATEMENTS
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
29 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
The City of Chowchilla (the City) was incorporated on February 7, 1923, as a municipal corporation under the General Laws of the State of California. The City operates as a self-governing local government unit within the State of California.
A five-member City Council appoints a City Administrator who administers the daily affairs under the policy guidance of the City Council. The City has limited authority to levy taxes and has the authority to determine user fees for the services that it provides. Voters elect a City Council that passes laws and determines broad policies. The City Council also oversees the operations of the City and approves all budgets, fund transfers, and fund balance reserves. Services provided by the City include public safety, streets and roads, water, sanitation, public improvements, culture and recreation, parks, building inspections, planning and zoning, redevelopment, and general administration.
B. Blended Component Units
A primary government is financially accountable for a component unit if it appoints a voting majority of an organization’s governing body and it is able to impose its will on the organization, or if there is a potential for the organization to provide specific financial benefits to, or impose specific financial burdens on, the primary government. A primary government may also be financially accountable if an organization is fiscally dependent on the primary government regardless of whether the organization has a separately-elected governing board, a governing board appointed by a higher level of government, or a jointly-appointed board, and there is a potential for the organization to provide specific financial benefits to, or impose specific financial burdens on the primary government. Based upon the application of these criteria, the following is a brief description of each component unit included within the City’s reporting entity. All such component units have been “blended” as though they are part of the primary government as the component unit’s governing body is substantially the same as the City’s primary government and there is a financial benefit or burden relationship between the City and the component unit. In addition, management of the City has operational responsibilities for the component unit, and/or the component units provide services almost entirely to the City or for the exclusive benefit of the City, even though it does not provide services directly to it, or the City is entirely or almost entirely responsible for the repayment of the debt of the component unit. Financial information for these component units can be obtained from the City’s Administrative Services Department and from the City’s website at www.cityofchowchilla.org.
The Public Financing Authority (the Authority) of the City of Chowchilla was formed on August 14, 1989, for the purpose of assisting the City in the financing of the acquisition, construction and installation of public capital improvements for the use, benefit and enjoyment of the citizens served by the City. The City Council serves as the governing board of the Authority and, therefore, is financially accountable for the operations of the Authority.
The Chowchilla Housing Authority (the Housing Authority) was established on January 24, 2012. The Housing Authority was activated pursuant to State Law Section 34240 of the California Health and Safety Code, which allows for every City to establish a housing authority. The Housing Authority is designed to protect local housing funds and programs, provide new revenue opportunities for affordable housing programs, serve the public interest, promote public safety and welfare, and ensure decent, safe, sanitary and affordable housing accommodations to persons of low income.
Since the City Council serves as the governing body of these entities, they are considered blended component units. As a result, the financial activities of these entities are integrally related to those of the City and are “blended” with those of the City.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
30 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Basis of Presentation
The accounts of the City are organized on the basis of funds. A fund is an independent fiscal and accounting entity with a self-balancing set of accounts. Fund accounting segregates funds according to their intended purpose and is used to aid management in demonstrating compliance with finance-related legal and contractual provisions. The minimum number of funds is maintained consistent with legal and managerial requirements.
Government-Wide Financial Statements – The Statement of Net Position and the Statement of Activities display information about the primary government (the City) and its component units. These statements include the financial activities of the overall government, except for fiduciary activities. Eliminations have been made to minimize the doublecounting of internal activities. These statements distinguish between the governmental and business-type activities of the City. Governmental activities generally are financed through taxes, intergovernmental revenues, and other non-exchange transactions. Business-type activities are financed in whole or in part by fees charged to external parties.
The Statement of Activities presents a comparison between direct expense and program revenues for each different identifiable activity of the City’s business-type activities and for each function of the City’s governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are included in the program expense reported for individual function. Certain indirect costs, which cannot be identified and broken down, are included in the program expenses reported for individual functions and activities. Program revenues include: 1) fines, fees, and charges paid by the recipients of goods and services offered by the programs; and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented instead as general revenues.
Certain eliminations have been made as prescribed by GASB Statement No. 34 with regard to interfund activities, payables, and receivables. All internal balances in the Statement of Net Position have eliminated except those representing balances between the governmental activities and the business-type activities, which are presented as internal balances and eliminated in the total primary government column. In the Statement of Activities, those transactions between governmental and business-type activities have not been eliminated. The following interfund activities have been eliminated: due to/due from other funds, interfund advances to/advances from, and transfers in/transfers out.
Fund Financial Statements – The fund financial statements provide information about the City’s funds. Separate statements for each fund category – governmental, proprietary, and fiduciary – are presented. The emphasis of fund financial statements is on major governmental and enterprise funds, each displayed in a separate column. All remaining governmental and enterprise funds are aggregated and reported as nonmajor funds. An accompanying schedule is presented to reconcile and explain the differences in funds and changes in fund balances as presented in these Statements to the Net Position and Changes in Net Position presented in the government-wide financial statements.
Proprietary fund operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up essentially equal values. Nonoperating revenues, such as subsidies and investment earnings, result from nonexchange transactions or ancillary activities. Operating expenses are those expenses that are essential to the primary operations of the fund. All other expenses are reported as nonoperating expenses.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
31 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Basis of Presentation (Continued)
The City reports the following major governmental funds:
The General Fund is the City’s primary operating fund. It accounts for all financial resources of the City except for those required to be accounted for in another fund.
The Community Development Block Grant (CDBG) Special Revenue Fund accounts for the revenues received by the various CDBG grants, the uses of those funds (i.e., grants and loans for housing rehabilitation projects), as well as the receipt and re-use of program income generated by the repayment of CDBG loans.
The Impact Fees Special Revenue Fund accounts for the accumulation of resources from developers for the expected future capital cost of the City as a result of development. Impact fees collected are restricted for the use of general, police, fire and parks facilities; and streets and roads, signalization, water, sewer and storm drain capital projects.
The Measure N Special Revenue Fund accounts for 1% Public Safety Sales Tax add-on that was voter approved in 2018 and became effective April 1, 2019. Monies are allocated between Police and Fire Departments and are used for growth and efficiency of the departments.
The Debt Service Fund accounts for the accumulation of resources that are restricted, committed or assigned for the payment of principal and interest on long-term obligations of governmental funds.
The Capital Projects Fund accounts for the acquisition and construction of the City’s major capital projects, other than those financed by proprietary funds.
Enterprise fund financial statements include a Statement of Net Position, a Statement of Revenues, Expenses and Changes in Net Position, and a Statement of Cash Flows for each major enterprise fund and nonmajor fund.
The City has five enterprise funds – water, solid waste, sewer, storm drain and airport. These funds are used to account for operations that are financed and operated in a manner similar to private business enterprise. In an enterprise fund, the intent of the City Council is that the costs (expenses, including depreciation) of providing services to the general public, on a continuing basis, be financed or recovered primarily through user charges.
The City reports the following major enterprise funds:
The Water Enterprise Fund accounts for the provision of water to the residents of the City. All activities necessary to provide such services are accounted for in this fund, including, but not limited to, administration, operations, distribution, maintenance, and debt service.
The Solid Waste Enterprise Fund accounts for the revenues and expenses for operation and maintenance of the solid waste system.
The Sewer Enterprise Fund accounts for the provision of wastewater collection and treatment services to the residents of the City. All activities necessary to provide such services are accounted for in this fund, including, but not limited to, administration, operations, maintenance, and debt service.
The Storm Drain Fund accounts for the revenues and expenses for operation and maintenance of the storm drain system.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
32 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Basis of Presentation (Continued)
Additionally, the government reports the following fund types:
Internal Service Funds:
The Fleet Maintenance Internal Service Fund accounts for the cost associated with maintaining the citywide fleet of vehicles and rolling stock heavy equipment. Charges are assessed to each department on the basis of time/materials necessary to maintain their equipment.
The Information Technology Internal Service Fund accounts for the costs of providing computer and information services. User charges are recovered from other City departments that utilized the services provided.
The Employee Benefits Internal Service Fund accounts for compensated absences and other employee benefits that are provided by the City.
Fiduciary Funds:
The Custodial Funds accounts for assets held by the City as an agent for special districts.
The Successor Agency Private Purpose Trust Fund accounts for assets and liabilities of the former redevelopment agency until they are distributed to other units of state and local government as a result of the dissolution of the redevelopment agency.
Measurement Focus, Basis of Accounting
Government-Wide, Proprietary and Fiduciary Fund Financial Statements – The government-wide, proprietary, and fiduciary fund financial statements are reported using the economic resources measurement focus. The governmentwide and proprietary fund financial statements are reported using the accrual basis of accounting. Revenues are recorded when earned, and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the City gives (or receives) value without directly receiving (or giving) equal value in exchange, include property and sales taxes, grants entitlements and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenues from sales taxes are recognized when the fiscal year in which all eligibility requirements have been satisfied.
Governmental Fund Financial Statements – Governmental funds are reported using current financial resources measurement focus and the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recognized when measurable and available. Property and sales taxes, interest, and charges for services are accrued when their receipt occurs within sixty days after the end of the accounting period to be both measurable and available. Expenditures are generally recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to claims and judgments and compensated absences, are recorded only when payment is due. General capital assets acquisitions are reported as expenditures in governmental funds.
Proceeds of general long-term debt and capital leases are reported as other financing sources.
Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of each fund. Nonoperating revenues, such as interest income, state and federal grants and subsidies, result from nonexchange transactions or ancillary activities. Operating expenses include costs for providing services and delivering goods such as administrative expenses and depreciation on capital assets. All other expenses not meeting this definition are reported as nonoperating expenses.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
33 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position/Fund Balances Cash and Cash Equivalents
For purposes of reporting cash flow, the City considers all highly-liquid investments with maturity of three months or less when purchased to be cash and cash equivalents.
Cash and Investments
The City maintains a cash and investment pool that is available for all funds. Each fund-type balance in the pool is reflected on the combined balance sheet as cash and investments. The City apportions interest earnings to all funds based on their quarterly cash balances.
The City pools cash and investments with the City Treasurer except for investments managed by fiscal agents under bonded debt agreements. Interest from bank accounts and investments are allocated quarterly to the various funds based on the fund’s contribution to the pool. The City has stated investments at fair value in the Statement of Net Position and Balance Sheet. The fair value of investments is based on published market prices and quotations from major investment brokers.
Cash and investments with fiscal agent represent funds held by various trustees from proceeds of the issuance of bonds in order to establish required reserve funds and to pay bond issuance costs per the respective trust agreements.
Credit Risk – The City’s investment policy limits certain types of investments to various ratings.
Custodial Credit Risk—Deposits – Custodial credit risk is the risk that in the event of a bank failure, the City’s deposits may not be returned to it. The City has a deposit policy for custodial risk that requires collateralization on certificates of deposit and repurchase (and reverse) agreements. In addition, the City maintains custodial agreements with certain independent third parties.
Concentration of Credit Risk – The City places no limit on the amount the City may invest in any one issuer.
Interest Rate Risk – Reserve funds may be invested in securities exceeding 10 years if the maturity of such investments is made to coincide as nearly as practicable with the expected use of the funds.
Restricted Assets
Certain proceeds of the general obligation debt and enterprise debt are classified as restricted assets on the balance sheet because their use is limited by applicable debt covenants. “Restricted cash and investments with fiscal agents” is used to report resources set aside for potential deficiencies in the repayment ability of the debt service fund and for payment of construction projects undertaken by the City.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
34 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position/Fund Balances (Continued) Internal Balances
Interfund transactions are reflected as loans, services provided or used, or reimbursements or transfers. Loans reported as receivables and payables, as appropriate, are subject to elimination upon consolidation and are referred to as either “due to/from other funds” (i.e., the current portion of interfund loans) or “advances to/from other funds” (i.e., the noncurrent portion of interfund loans). Any residual balances outstanding between the governmental activities and the business-type activities are reported in the fund financial statements and are offset by a fund balance reserve account in applicable governmental funds to indicate that they are not available for appropriation and are not available financial resources.
Services provided or used, deemed to be at market or near market rates, are treated as revenues and expenditures or expenses. Reimbursements occur when one fund incurs a cost, charges the appropriate benefiting fund, and reduces its related cost as a reimbursement. All other interfund transactions are treated as transfers. Transfers between governmental or proprietary funds are netted as part of the reconciliation to the government-wide presentation.
Notes Receivable
The City engages in programs designed to encourage construction or improvement of housing for persons with low to moderate income and to encourage business development. Under these programs, grants or loans are provided under favorable terms to homeowners or developers who agree to spend these funds in accordance with the City’s terms. For financial statement purposes, the City has established an estimated allowance for potentially uncollectible loans. The balance of notes receivable includes loans that may be forgiven if certain terms and conditions of the loans are met.
Leases
Lessee: The City is a lessee for a noncancellable lease of a building. The lessee 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 lease 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, plus certain initial direct costs. Subsequently, the lease asset is amortized on a straight-line basis over its useful life.
Key estimates and judgments related to leases include how the City determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) lease payments. The City uses the interest rate charged by the lessor as the discount rate. When the interest rate charged by the lessor is not provided, the City generally uses its estimated incremental borrowing rate as the discount rate for leases, which it has determined is the prime rate at the inception of the lease. The lease term includes the noncancellable period of the lease. Lease payments included in the measurement of the lease liability are composed of fixed payments.
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 liabilities are reported with long-term debt on the Statement of Net Position.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
35 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position/Fund Balances (Continued) Leases (Continued)
Lessor: The City recognizes a lease receivable and a deferred inflow of resources in the government-wide and governmental and enterprise 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, the lease receivable is reduced by the principal portion of lease payments received. The deferred inflow of resources is initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date. Subsequently, the deferred inflow of resources is recognized as revenue over the life of the lease term.
Key estimates and judgments include how the City determines (1) the discount rate it uses to discount the expected lease receipts to present value, (2) lease term, and (3) lease receipts. The City uses the interest rate charged to the lessees as the discount rate. When the interest rate charged to the lessees is not provided, the City generally uses the implied rate of return as the discount rate for leases. When the implied rate of return has not been determined, the City uses its estimated incremental borrowing rate which it has determined is the prime rate at the inception of the lease. 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 certain changes occur that are expected to significantly affect the amount of the lease receivable.
Capital Assets
Capital assets, which include public domain (infrastructure) capital assets consisting of certain improvements, including streets (pavements, medians, curbs/gutters, sidewalks, traffic signals, monument signs and bridges), storm drains and water/sewer systems and improvements, are reported in the applicable governmental or business-type activities column in the government-wide financial statements.
Generally, capital asset acquisitions in excess of $5,000 (general capital assets) and $30,000 (infrastructure) are capitalized if they have an expected useful life of one year or more. Acquisitions of capital assets (including infrastructure) are recorded at historical cost at the time of purchase. Donated capital assets are recorded at their fair value at the date of donation.
Land and construction in progress are not depreciated. The other property, plant, equipment, and infrastructure of the City are depreciated using the straight-line method over the following estimated useful lives:
Land improvements 20-50 years
Buildings and improvements 20-50 years
Machinery, equipment and vehicles 6-10 years
Infrastructure 20-100 years
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
36 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position/Fund Balances (Continued) Subscription-Based Information Technology Arrangements (SBITAs) Lessee: The City enters into noncancellable subscription-based information technology arrangements (SBITAs) for the acquisition of various information technology services. SBITAs are accounted for in accordance with GASB Statement No.
96. Upon commencement of a subscription, the City recognizes a subscription liability and an intangible right-to-use subscription asset (subscription asset) in the government-wide financial statements. Subscription liabilities are recognized when their initial individual values are $5,000 or more. The subscription liability is initially measured at the present value of payments expected to be made during the subscription term and is subsequently reduced by the principal portion of subscription payments made. The subscription asset is initially measured as the initial amount of the subscription liability, adjusted for subscription payments made at or before the subscription commencement date, and any directly attributable initial costs. The subscription asset is amortized on a straight-line basis over its useful life.
Key estimates and judgments related to SBITAs include determining the discount rate used to discount expected subscription payments to present value, the subscription term, and the composition of subscription payments.
The City generally uses the interest rate charged by the subscription provider as the discount rate. When the interest rate charged by the provider is not provided, the City generally uses its estimated incremental borrowing rate as the discount rate for SBITAs, which is the prime rate at the inception of the subscription.
Compensated Absences
It is the City’s policy to permit employees to accumulate a limited amount of earned but unused leave time. Permanent employees earn from 12 to 30 vacation days per year depending upon their length of employment. Accumulated vacation days can be carried forward up to 2 years. Each year, by September 30, certain employees may request to receive a cash payment for the value of all or a portion of their accumulated vacation leave. Upon termination or retirement, employees are compensated for the value of accrued vacation leave.
For full-time employees, sick leave is accumulated at the rate of 12 days per year up to a maximum of 250 days.
Employees may convert 25% of unused sick leave to vacation time during a fiscal year up to the limit of the employee’s maximum vacation accrual level. Upon retirement, employees may also convert a portion of their unused sick leave into service credit through the California Public Employees Retirement System.
The vacation and sick leave balances, along with compensatory leave and holiday hours are reflected in the Employee Benefits Fund, which is part of the Internal Service Funds in the Statement of Net Position.
Long-Term Obligations
In the government-wide financial statements and proprietary fund 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. Bond premiums and discounts are deferred and amortized over the life of the bonds using the straight-line method. Bonds payable are reported net of the applicable bond premium or discounts. Bond issuance costs are expensed immediately.
In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources.
Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether withheld from the actual debt proceeds received, are reported as debt service expenditures.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
37 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position/Fund Balances (Continued) Pensions
In government-wide financial statements, pensions are recognized and disclosed using the accrual basis of accounting (see Note 11 and the RSI section immediately following the Notes to the Basic Financial Statements), regardless of the amount recognized as pension expenditures on the modified accrual basis of accounting. The City recognizes a net pension liability for the qualified pension plan in which it participates, which represents the excess of the total pension liability over the fiduciary net position of the qualified pension plan, measured as the City’s proportionate share thereof in the case of a cost-sharing multiple-employer plan. Changes in the net pension liability during the period are recorded as pension expense, or as deferred inflows of resources or deferred outflows of resources depending on the nature of the change, in the period incurred. Those changes in net pension liability that are recorded as deferred inflows of resources or deferred outflows of resources that arise from changes in actuarial assumptions or other inputs and differences between expected or actual experience are amortized over the weighted average remaining service life of all participants including retirees, in the respective qualified pension plan and recorded as a component of pension expense beginning with the period in which they arose. Projected earnings on qualified pension plan investments are recognized as a component of pension expense. Differences between projected and actual investment earnings are reported as deferred inflows of resources or deferred outflows of resources and amortized as a component of pension expense on a closed basis over a five-year period beginning with the period in which the difference occurred.
Interest Payable
In the government-wide financial statements, interest payable on long-term debt is recognized as a liability when incurred and is not recognized in the governmental funds’ financial statements.
Unearned Revenue
Unearned revenue is that for which asset recognition criteria have been met, but for which revenue recognition criteria have not been met. The City typically records intergovernmental revenues (primary grants and subventions) received but not earned (qualifying expenditures not yet incurred).
Unavailable Revenue
In the governmental fund financial statements, unavailable revenue is recorded when transactions have not yet met the revenue recognition criteria based on the modified accrual basis of accounting. The City records unavailable revenue for transactions for which revenues have been earned, but for which funds are not available to meet current financial obligations.
Transfers
In the fund financial statements interfund transfers are recorded as transfers in (out) except for transactions that are described below:
Charges for services are recorded as revenues of the performing fund and expenditures of the requesting fund.
Unbilled costs are recognized as an asset of the performing fund at the end of the fiscal year.
Reimbursements for expenditures, initially made by one fund that is properly applicable to another fund, are recorded as expenditures in the fund that is reimbursed.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
38 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position/Fund Balances (Continued) Net Position
The government-wide and enterprise fund financial statements utilize a net position presentation. Net position is reported as net investment in capital assets, restricted or unrestricted.
Net investment in capital assets – groups all capital assets, including infrastructure, into one component of net position. Accumulated depreciation and the outstanding balances of debt that are attributable to the acquisition, construction, or improvement of these assets reduce the net position balance.
Restricted – represents external restrictions imposed by creditors, grantors, contributors, or laws of regulations of other governments and restrictions imposed by law through constitutional provisions or enable legislation.
Unrestricted – represents net position of the City, not restricted for any project or other purpose.
When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources as they are needed.
Fund Balances
The governmental fund financial statements present fund balances based on classifications the comprise a hierarchy that is based primarily on the extent to which the City is bound to honor constraints on the specific purposes for which amounts in the respective governmental funds can be spent. The classification used in governmental fund financial statements are as follows.
Nonspendable Fund Balance – Amounts cannot be spent either because they are in nonspendable form (such as inventory or prepaid expenses, and long-term loans and notes receivable) or because they are legally or contractually required to be maintained intact (such as principal of a permanent fund).
Restricted Fund Balance – Amounts with external constraints placed on the use of these resources (such as debt covenants, grantors, contributors, or laws or regulations of other governments, etc.) or imposed by law through constitutional provisions or enabling legislation.
Committed Fund Balance – Amounts that can only be used for specific purposes pursuant to constraints imposed by City Council, the City’s highest level of decision-making authority, through an ordinance or resolution. These committed amounts cannot be used for any other purpose unless the City Council removes or changes the specified uses through the same type of formal action taken to establish the commitment.
Assigned Fund Balance – Amounts that do not meet the criteria to be classified as restricted or committed but that are intended to be used for specific purposes. Intent is expressed by the City Council or its designee and may be changed at the discretion of the City Council or its designee. For all governmental funds other than the General Fund, any remaining positive amounts not classified as nonspendable, restricted or committed must be designated as assigned fund balance.
Unassigned Fund Balance – These are either residual positive net resources of the General Fund in excess of what can properly be classified in one of the other four categories, or negative balances in all other funds.
In circumstances when expenditures are made for a purpose for which amounts are available in multiple fund balance classifications, fund balance is generally depleted in the order of restricted, committed, assigned, and unassigned.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
39 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position/Fund Balances (Continued) Minimum Fund Balance Policy
The City’s minimum fund balance policy requires the City to maintain reserves equal to 2 months (17%) and 3 months (25%) of costs based on the annual adopted budget for Enterprise Funds and the General Fund, respectively. The use of these funds shall be allowed in situations resulting from the loss of revenues and must be replenished before the end of the following fiscal year.
Risk Management
The City participates with other public entities in a joint venture under a joint powers agreement which established the Central San Joaquin Valley Risk Management Authority (CSJVRMA). The relationship between the City and CSJVRMA is such that CSJVRMA is not a component unit of the City for financial reporting purposes.
Use of Estimates
The preparation of financial statements in conformity with United States generally accepted accounting principles (U.S.
GAAP) requires management to make estimates and assumptions that affect certain reported amounts and disclosures.
Actual results could differ from those estimates.
Property Tax Calendar
Madera County is responsible for assessing, collecting and distributing property taxes in accordance with enabling legislation. Revenue received is based on an allocations factor calculated by the County under the provisions of Proposition 13 plus a percentage of the increase in market value in specific areas. The City’s property tax is liened based on the assessed value listed as of the prior January 1 for all real and personal property located in the City. Property sold and the assessment date (January 1) is reassessed and the amount of property tax assessed is prorated.
Secured property taxes are levied on October 1 and are due in two installments on November 1 and February 1. The tax becomes delinquent after December 10 and April 10, respectively. Unsecured property tax is levied on July 1, due on July 31, and becomes delinquent after August 31.
NOTE 2 – CASH AND INVESTMENTS
Cash and investments as of June 30, 2024 are classified in the accompanying financial statements as follows:
Statement of Net Position:
Cash and investments $ 40,898,501
Restricted cash and investments with fiscal agents 1,137,355 Statement of Fiduciary Net Position:
Cash and investments 2,854,671
Restricted cash with fiscal agents 699,281
Total cash and investments 45,589,808 $
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
40 NOTE 2 – CASH AND INVESTMENTS (Continued)
Cash and investments as of June 30, 2024 consisted of the following:
Cash on hand $ 2,200
Deposits with financial institutions 5,942,943
Investments 39,644,665
Total cash and investments 45,589,808 $
A. Deposits
The carrying amount of the City’s cash deposits was $5,942,943 at June 30, 2024. Bank balances were $5,849,530, the total amount of which was insured and/or collateralized with securities held by the pledging financial institutions in the City’s name as described below.
The California Government Code requires California banks and savings and loan associations to secure the City’s cash deposits by pledging securities as collateral. This code states that collateral pledged in this manner shall have the effect of perfecting a security interest in such collateral superior to those of a general creditor. Thus, collateral for cash deposits is considered to be held in the City’s name.
The market value of pledged securities must equal at least 110% of the City’s cash deposits. California law also allows institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the City’s total cash deposits.
The City follows the practice of pooling cash and investments of all funds, except for funds required to be held by fiscal agents under the provisions of bond indentures. Interest income earned on pooled cash and investments is allocated on an accounting period basis to the various funds based on the period-end cash and investment balances. Interest income from cash and investments of fiscal agents is credited directly to the related fund.
Investments Authorized by the California Government Code and the City’s Investment Policy In accordance with Section 53601 of the California Government Code and the City’s investment policy, the City is authorized to invest in Certificates of Deposit, the California Local Agency Investment Fund (LAIF), U.S. Treasury Obligations, U.S. Government Agencies, Medium-Term Notes, Bankers’ Acceptances, and Commercial Paper of “prime” quality of the highest ranking or of the highest letter and numerical rating as provided by Moody’s Investor Services, Inc. or Standards and Poor’s Corporation. In accordance with the City’s investment policy, the City will not invest in repurchase agreements, reverse repurchase agreements, or any other type of investments prohibited by California Government Code Section 53601.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
41 NOTE 2 – CASH AND INVESTMENTS (Continued)
A. Deposits (Continued)
Disclosure Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment.
Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates.
Information about the sensitivity of the fair values of the City’s investments to market interest rate fluctuations is provided by the following table that shows the maturity date of each investment:
Investment Type Total
12 Months
or Less
State Investment Pool $ 14,608,859 $ 14,608,859
Federal Agency Securities:
U.S. Treasury Notes 16,132,249 16,132,249
Held by fiscal agent:
Treasury Obligation Funds 1,372,421 1,372,421
Tri County Savings 7,066,920 7,066,920
Money Market Funds 464,216 464,216
Total $ 39,644,665 39,644,665 $
Disclosure Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment.
This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the actual rating as of year-end for each investment type:
Investment Type Total AAA AAAm Not Rated
State Investment Pool $ 14,608,859 $ - $ 14,608,859 - $ Federal Agency Securities:
U.S. Treasury Notes 16,132,249 16,132,249 - -
Held by fiscal agent:
Treasury Obligation Funds 1,372,421 1,372,421 - -
Tri County Savings 7,066,920 - 7,066,920 -
Money Market Funds 464,216 - - 464,216
Total $ 16,132,249 39,644,665 $ 1,372,421 $ 22,139,995 $ Ratings as of Year-End
Concentration of Credit Risk
The investment policy of the City contains no limitation on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code. The City did not have investments in any one issuer (other than U.S.
Treasury securities, mutual funds, and external investment pools) that represent 5% or more of total City’s investments for the year ended June 30, 2024.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
42 NOTE 2 – CASH AND INVESTMENTS (Continued)
A. Deposits (Continued)
Investment Valuation
Investments, including derivative instruments that are not hedging derivatives, are measured at fair value on a recurring basis. Recurring fair value measurements are those that Governmental Accounting Standards Board (GASB) Statements require or permit in the Statement of Net Position at the end of each reporting period. Fair value measurements are categorized based on the valuation inputs used to measure an asset’s fair value: Level 1 investments reflect prices quoted in active markets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs.
Investments’ fair value measurements are as follows at June 30, 2024:
Investments Fair Value Level 1 Inputs Level 2 Inputs Level 3 inputs Debt securities:
U.S. Treasury Notes $ 16,132,249 $ 16,132,249 $ - $ -
Treasury Obligation Funds 1,372,421 1,372,421 - -
Total 17,504,670 17,504,670 $ - $ - $
Investments not subject to fair value
heirarchy:
Money Market Funds 464,216
Tri County Savings 7,066,920
State Investment Pool 14,608,859
Total Investments 39,644,665 $
Fair Value Measurements
Treasury obligations are valued at marked to market based on quoted market closing prices.
Investment in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. The fair value of the City’s investment in this pool is reported in the accompanying financial statements at amount based upon the City’s pro-rata share of the amortized cost provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of the portfolio). The balance available for withdrawal is based in the accounting records maintained by LAIF, which are recorded on an amortized cost basis. Although the City did not participate in any securities lending transactions or enter into any reverse repurchase agreements during the year, the City does have an investment in LAIF in the amount of $14,608,859. The Local Investment Advisory Board (Board) has oversight responsibility for LAIF. The Board consists of five members designated by State statute. The value of the pool shares in LAIF, which may be withdrawn, is determined on an amortized cost basis, which is different from the fair value of the City’s position in the pool.
Investment in Money Market Funds
Investment in the money market funds is valued at $464,216 and have a maturity of less than one year and are presented at amortized costs, which approximates fair value. As they are presented at amortized costs, they are not an investment type that can be categorized at any level in the fair value hierarchy.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
43 NOTE 3 – RECEIVABLES
Receivables as of the June 30, 2024 year-end for the City’s individual major funds and nonmajor funds, including applicable allowances for uncollectible accounts, were as follows:
Governmental Activities
CDBG
Grants Measure N Other Total
Special Special Capital Governmental Governmental
General Revenue Revenue Projects Funds Funds
Receivables:
Accounts receivable $ 417,123 $ - $ - $ - $ 545 $ 417,668 Intergovernmental receivables 874,989 137,071 515,801 187,990 2,233,376 3,949,227 Notes receivable 22,569,756 - - 1,633,012 - 24,202,768
Less: allowance for
for uncollectibles - - - - - -
Net receivables $ 22,706,827 1,292,112 $ 515,801 $ 187,990 $ 3,866,933 $ 28,569,663 $ Business-Type Activities - Enterprise Funds
Nonmajor
Solid Storm
Water Waste Sewer Drain Airport Total
Receivables:
Accounts receivable 435,273 $ 264,125 $ 226,428 $ 25,015 $ - $ 950,841 $ Intergovernmental receivables - - 30,907 1,497,911 11,893 1,540,711 Less: allowance for
for uncollectibles (24,117) (14,105) (13,505) (1,809) - (53,536) Net receivables 411,156 $ 250,020 $ 243,830 $ 1,521,117 $ 11,893 $ 2,438,016 $ Receivables are presented on the Statement of Net Position as follows:
Governmental Business-Type
Activities Activities Total
Accounts receivable, net $ 417,668 $ 897,305 $ 1,314,973 Intergovernmental receivables 3,949,227 1,540,711 5,489,938 Notes receivable, net - 24,202,768 24,202,768
Total 28,569,663 $ 2,438,016 $ 31,007,679 $
Receivables in governmental funds which are not expected to be collected in one year are as follows:
Notes receivable in CDBG Grants Special Revenue Fund $ 22,569,756 Notes receivable in Home Investment Program Grants Special Revenue Fund 1,564,162 Notes receivable in Low and Moderate Income Housing Asset Special Revenue Fund 68,850 Total $ 24,202,768
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
44 NOTE 4 – INTERNAL BALANCES
Due from and due to balances at June 30, 2024 were as follows:
Due From Due To
Governmental Funds:
Major Funds:
General Fund 901,565 $ - $
Nonmajor Funds:
SAFER Fire Grant Fund 30,496 -
RSTP Special Revenue Fund 111,570 -
Transit System Special Revenue Fund 601,694 -
Information Technology Internal Service Fund 120,830 -
Low and Moderate Low Income Housing Asset Fund 36,975 - Total $ 901,565 901,565 $
The “due from” balance of $901,565 in the General Fund listed above represents loans made to other funds to cover operating cash deficit balances.
Advances to and from balances at June 30, 2024 were as follows:
Advances To Advances From
Governmental Funds:
Major Funds:
General Fund $ - 389,383 $
Impact Fees Special Revenue Fund 389,383 -
Total $ 389,383 389,383 $
The balance of $389,383 for advances from other funds in the Impact Fees Special Revenue Fund consists of cash advances from the General Fund and will be paid back with future impact fees. The City has indicated that there are no plans to collect on the advance within the next year.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
45 NOTE 5 – TRANSFERS
Transfers for the year ended June 30, 2024, are summarized as follows:
Transfers In Transfers Out
Governmental Funds:
Major Funds:
General Fund 1,917,621 $ 2,980,449 $ (1), (6)
CDBG Grants Special Revenue Fund 20,685 203,341 (2)
Impact Fees Special Revenue Fund 481,606 - (8)
Measure N Special Revenue Fund 1,892,817 (5)
Debt Service Fund 1,397,805 -
Capital Projects Fund 189,337 -
Nonmajor Funds:
State Gas Tax Special Revenue Fund 144,473 - (3)
SB1 Special Revenue Fund 14,502 540,558 (4)
RSTP Special Revenue Fund 209,862 - (10)
Street and Road Fund (LTF) Special Revenue Fund 1,270,276 175 Measure T Special Revenue Fund 473,733 - (7)
EDBG Grant Special Revenue Fund - 20,685 (9)
Enterprise Funds:
Major Funds:
Storm Drain Enterprise Fund 105,398 -
Water Enterprise Fund - 2,032,075
Total $ 6,947,699 6,947,699 $
The significant transfers out noted above were for the following purposes:
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
Transfer out $125,380 to Street and Road for Alley Paving project and $16,826 to Genral Fund for police department equipment.
Transfer out $14,502 to State Gas Tax for projects required by State; $2,316 to Street and Road for CFD Services; $1,331,556 to Debt Service for bond payments.
Transfer out $105,398 to Storm Drain for Kings Ave Storm Drain project and $97,943 to Street and Road for ADA Sidewalk Project.
Transfer out $540,558 to Street and Road for Chowchilla Blvd Project.
Transfer out $1,826,567 to General Fund for Fire Expansion project and police department equipment; $66,248 to Debt Service for Pension Transfer out to Street and Road Fund for capital outlay costs relating to Alley Paving project and Chowchilla Blvd Project, and also for general streets maintenance
Transfer out to CDBG Grants Special Revenue Fund to cover associated with Grant management and cover contracted costs when no Admin Program Income is available.
Transfer out $209,862 to Street and Road Fund for Chowchilla Blvd Project.
Transfer out $74,052 to General Fund for Edward Ray Park; $400,000 to Water Fund for Well 15 Transfer out $1,632,075 to Water Enterpise Fund for Well Projects and Water Main Stubouts.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
46 NOTE 6 – CAPITAL ASSETS
Capital assets activity of the governmental activities for the year ended June 30, 2024, was as follows:
Balance
July 1, 2023
Prior Period
Adjustments
Restated Balance
July 1, 2023 Additions Reductions
Balance
June 30, 2024
Capital assets, not being depreciated:
Land 721,926 $ - $ 721,926 $ 44,471 $ - $ 766,397 $
Construction in progress 5,681,063 (2,217,169) 3,463,894 3,645,086 (2,930,806) 4,178,174 Total capital assets, not being depreciated 6,402,989 (2,217,169) 4,185,820 3,689,557 (2,930,806) 4,944,571 Capital assets, being depreciated/amortized:
Land improvements 1,569,968 - 1,569,968 - - 1,569,968
Buildings and improvements 7,677,380 1,873,884 9,551,264 32,296 - 9,583,560 Right-to-use leased asset 173,689 - 173,689 333,412 - 507,101 SBITA - Right-to-use asset - 56,745 56,745 30,186 - 86,931 Machinery, equipment and vehicles 6,087,984 80,707 6,168,691 1,398,579 (16,394) 7,550,876 Infrastructure 20,761,872 1,610,380 22,372,252 2,225,909 - 24,598,161 Total capital assets, being depreciated/amortized 36,327,638 3,564,971 39,892,609 4,020,382 (16,394) 43,896,597 Less accumulated depreciation/amortization for:
Land improvements (1,239,974) - (1,239,974) (70,977) - (1,310,951) Buildings and improvements (3,516,516) 6,132 (3,510,384) (256,159) - (3,766,543) Right-to-use leased asset (155,029) - (155,029) (38,906) - (193,935) SBITA - Right-to-use asset - (5,135) (5,135) (22,935) - (28,070) Machinery, equipment and vehicles (3,573,624) 15,972 (3,557,652) (628,039) 6,236 (4,179,455) Infrastructure (10,331,445) 10,727 (10,320,718) (666,244) - (10,986,962) Total accumulated depreciation/amortization (18,821,723) 32,831 (18,788,892) (1,683,260) 6,236 (20,465,916) Total capital assets being depreciated/amortized, net 17,505,915 3,597,802 21,103,717 2,337,122 (10,158) 23,430,681 Governmental activities capital assets, net 23,908,904 $ 1,380,633 $ 25,289,537 $ 6,026,679 $ (2,940,964) $ 28,375,252 $ Depreciation expense was charged to the following functions/programs of the governmental activities of the primary government as follows:
Governmental Activities:
General government $ 392,221
Public safety 462,101
Highways and streets 641,266
Culture and recreation 109,915
77,757
Total depreciation/amortization expense - governmental activities 1,683,260 $ Capital assets held by government's internal service funds are charged to the various functions based on their usage of the assets
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
47 NOTE 6 – CAPITAL ASSETS (Continued)
Capital assets activity of the business-type activities ended June 30, 2024 was as follows:
Balance
July 1, 2023 Additions Reductions
Balance
June 30, 2024
Capital assets, not being depreciated:
Land $ 2,031,405 $ - $ (1,253) $ 2,030,152
Construction in progress 3,762,552 1,725,673 (1,475,406) 4,012,819 Total capital assets, not being depreciated 3,757,078 3,762,552 (1,476,659) 6,042,971 Capital assets, being depreciated:
Land improvements - 1,253,762 - 1,253,762
Buildings and improvements 1,475,406 3,989,173 - 5,464,579 Right-to-use leased asset - 45,135 - 45,135
Machinery, equipment, and vehicles - 1,684,225 - 1,684,225 Infrastructure - 27,053,385 1,253 27,054,638
Total capital assets, being depreciated 1,520,541 33,980,545 1,253 35,502,339 Less accumulated depreciation for:
Land improvements (37,271) (910,887) - (948,158)
Buildings and improvements (105,979) (1,893,219) - (1,999,198) Right-to-use leased asset - (4,136) - (4,136)
Machinery, equipment, and vehicles (132,898) (762,772) - (895,670) Infrastructure (601,312) (9,250,010) - (9,851,322)
Total accumulated depreciation (12,816,888) (881,596) - (13,698,484) Total capital assets being depreciated, net 638,945 21,163,657 1,253 21,803,855 Business-type activities capital assets, net $ 4,401,497 24,920,735 $ (1,475,406) $ 27,846,826 $ Depreciation expense was charged to the following functions/programs of the governmental activities and business-type activities of the primary government as follows:
Business-Type Activities:
Water $ 500,037
Sewer 308,715
Storm drain 46,131
Airport 26,713
Total depreciation expense - business-type activities 881,596 $ CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
48 NOTE 7 – SUBSCRIPTION BASED INFORMATION TECHNOLOGY ARRANGEMENTS (SBITAS) AS A LESSEE In fiscal year 2023, the City entered a three-year SBITA as a lessee for OpenGov software, which has been recorded in the Information Technology Internal Service Fund. An initial SBITA liability was recorded in the amount of $56,745 during fiscal year 2023. As of June 30, 2024, the value of the SBITA liability was $19,845. The City is required to make annual principal and interest payments of $18,900 and $19,845, respectively. The SBITA has an effective interest rate of 0%. The software has a three-year subscription term. The value of the right-to-use software as of the end of the current fiscal year was $56,745 and had accumulated amortization of $24,040. In accordance with GASB 96, certain variable and other payments are not included in the measurement of the subscription liability. There were no outflows of resources recognized in the reporting period for variable and other payments.
Fiscal Year
Ending June 30 Principal Interest
2025 $ - 19,845 $
Total $ 19,845 - $
In fiscal year 2024, the City entered into a SBITA in accordance with GASB Statement No. 96, related to firewall IT assets and components used for networking and security which has been recorded in the Information Technology Internal Service Fund. The arrangement is with CDW-G and commenced in February 2024 with a three-year term. There are no extension options included in the agreement.
Upon commencement of the arrangement, the government recognized a subscription liability of $30,186, representing the present value of the subscription payments. The liability was fully paid up front, and therefore no additional payments are due over the term of the agreement. The corresponding right-to-use subscription asset was recorded in the same amount and is being amortized over its useful life of three years.
The discount rate applied to measure the present value of the liability was 8.5%. The value of the right-to-use software as of the end of the current fiscal year was $30,186 and had accumulated amortization of $4,020. There are no variable payments, termination penalties, or additional commitments related to this SBITA.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
49 NOTE 8 – LONG-TERM DEBT
The following is a summary of debt transactions of the City for the year ended June 30, 2024:
Amounts
Balance Balance Due Within
June 30, 2023 Additions Reductions June 30, 2024 One Year Governmental Activities:
2005 Civic Center Bond 3,355,000 $ - $ - $ 3,355,000 $ 220,000 $ 2017 Series Lease Revenue Bonds 3,575,000 - (25,000) 3,550,000 25,000 State of California NSP Loan 9,913,215 - - 9,913,215 -
2019 Taxable Pension Obligation Bonds 9,235,000 - (530,000) 8,705,000 575,000 Add: Premiums 137,775 - (5,990) 131,785 -
Less: Discounts (101,785) - 6,456 (95,329) -
Compensated absences 518,302 416,821 (370,748) 564,375 383,919 Total Governmental Activities Long-Term Debt $ 416,821 26,632,507 $ (925,282) $ 26,124,046 $ 1,203,919 $ Business-Type Activities:
Direct Placements and Direct Borrowings:
State Water Revolving Loan $ - 2,484,643 $ (240,449) $ 2,244,194 $ 160,300 $ Total Direct Placements and Borrowings - 2,484,643 (240,449) 2,244,194 160,300 2017 Series Water Revenue Bonds 8,060,000 - - 8,060,000 25,000 2017 Series Wastewater Revenue Bonds 3,045,000 - (40,000) 3,005,000 45,000 Add: Premiums 476,249 - (24,253) 451,996 -
Total Business-Type Activities Long-Term Debt $ - 14,065,892 $ (304,702) $ 13,761,190 $ 230,300 $ Long-term debt payable at June 30, 2024 is comprised of the following individual issues:
A. 2005 Civic Center Bond
In 2005, the City issued Revenue Bonds in the aggregate principal amount of $5,890,000 to refund the 2002 $1,900,000 Civic Center Project Private Placement Financing and to finance certain public improvements. The original amount of the note ($5,890,000) was secured by revenues of the Public Financing Authority (the Authority) consisting primarily of lease payments to be received by the Authority from the City under a lease agreement dated July 1, 2005, by and between the Authority and the City which are payable from the City’s General Fund for lease by the City of certain real property and public facilities located in the City, and then constituting the Civic Center Project. There is a provision whereby if the City is unable to make payment or does not comply with bond covenants, the Trustee may, and shall at the written direction of the Owners of not less than a majority in aggregate principal amount of Bonds at that time outstanding, declare the principal of all bonds outstanding and the accrued interest thereon to be due and payable immediately. Semiannual payments range from $7,875 to $357,875 and are payable each January 1 and July 1 through 2036. During the year ended June 30, 2017 the 2005 Civic Center Bond was partially refunded by the 2016 Civic Center Bond for the purposes of savings on future debt service payments.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
50 NOTE 8 – LONG-TERM DEBT (Continued)
A. 2005 Civic Center Bond (Continued)
Annual debt service requirements to maturity of the 2005 Civic Center Bond are as follows:
Fiscal Year
Ending June 30 Principal Interest
2025 $ 214,089 220,000 $
2026 230,000 129,456
2027 235,000 119,175
2028 250,000 108,238
2029 260,000 96,863
2030-2034 1,475,000 292,725
2035-2039 685,000 15,750
Total $ 976,296 3,355,000 $
B. 2017 Series Lease Revenue Bonds
In 2018, the Chowchilla Public Financing Authority issued Revenue Bonds in the aggregate principal amount of $3,630,000 to finance the costs of clean renewable energy projects and other capital improvements. The original amount of the bonds ($3,630,000) were secured by a pledge of and lien on revenues consisting primarily of lease payments from the City. There is a provision whereby if the City is unable to make payment or does not comply with bond covenants, the Trustee may, and shall at the written direction of the Owners of not less than a majority in aggregate principal amount of Bonds at that time outstanding, declare the principal of all bonds outstanding and the accrued interest thereon to be due and payable immediately. Principal is payable annually on June 1 in amounts ranging from $10,000 to $375,000, with interest due semi-annually at variable rates between 2.6% - 5.0%, maturing on June 1, 2047.
Annual debt service requirements to maturity of the 2017 Series Lease Revenue Bonds are as follows:
Fiscal Year
Ending June 30 Principal Interest
2025 $ 25,000 $ 155,929
2026 - 155,117
2027 30,000 155,117
2028 40,000 153,961
2029 40,000 152,418
2030-2034 355,000 733,086
2035-2039 730,000 639,680
2040-2044 1,375,000 420,399
2045-2049 80,985 955,000
Total $ 2,646,692 3,550,000 $
C. 2019 Pension Obligation Bonds
In 2019, the Chowchilla Public Financing Authority issued Pension Obligation Bonds in the aggregate principal amount of $10,500,000 to finance a portion of the City’s unfunded accrued actuarial liability to the California Public Employees’ Retirement System (CalPERS) for the benefit of the City’s employees and pay the costs of issuance of the bonds. The bonds are unsecured obligations payable from any source of legally available funds of the City, including, but not limited to, amounts held by the City on deposit in its General Fund. Principal is payable annually on July 15 in amounts ranging from $10,000 to $640,000, with interest due semi-annually at variable rates between 2.94% - 4.75%, maturing on July 15, 2046. There is a provision whereby if the City is unable to make payment, does not comply with bond covenants, or files for reorganization or arrangement, the Trustee may declare the entire unpaid principal and interest immediately due and payable.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
51 NOTE 8 – LONG-TERM DEBT (Continued)
C. 2019 Pension Obligation Bonds (Continued)
Annual debt service requirements to maturity of the 2019 Pension Obligation Bonds are as follows:
Fiscal Year
Ending June 30 Principal Interest
2025 $ 575,000 $ 347,707
2026 620,000 327,556
2027 470,000 308,572
2028 510,000 290,971
2029 545,000 271,498
2030-2034 3,000,000 1,004,935
2035-2039 1,910,000 427,675
2040-2044 950,000 134,900
2045-2049 125,000 5,344
Total $ 3,119,158 8,705,000 $
D. State of California Neighborhood Stabilization Program (NSP) Loan In fiscal year 2011, the City entered into a loan agreement with the Department of Housing and Community Development (the DHCD). The City could borrow up to $10,000,000 to assist Olivero Ranch, LLC, in financing construction of 31 multifamily units, of which 30 units will be restricted to households at or below 50% of all AMI households in the City. The entire outstanding principal balance plus all accrued but unpaid interest is due in full on the 55th anniversary of the date of the project’s receipt of certificates of occupancy. There is no interest due on the loan; however, any program income resulting from the financing provided to Olivero Ranch, LLC will be returned to the DHCD. The loan will be secured on the property on which the project is located. All loan payments will be generated by the operation of the housing development by the private developer which will pass through the City and back to the State.
E. 2017 Series Water Revenue Bonds
In 2017, the Chowchilla Public Financing Authority issued Revenue Bonds in the aggregate principal amount of $8,160,000 to finance capital projects in the Water Fund. The original amount of the bonds ($8,160,000) were secured by installment payments to be made by the City under an installment sale agreement. There is a provision whereby if the City is unable to make payment or does not comply with bond covenants, the Trustee may, and shall at the written direction of the Owners of not less than a majority in aggregate principal amount of Bonds at that time outstanding, declare the principal of all bonds outstanding and the accrued interest thereon to be due and payable immediately. These installment payments are secured by a pledge of and lien on the net revenues of the Water Fund. Principal is payable annually on June 1 in amounts from $10,000 to $775,000, with interest due semi-annually at variable rates between 2.6% - 5.0%, maturing on June 1, 2047.
Annual debt service requirements to maturity of the 2017 Series Water Revenue Bonds are as follows:
Fiscal Year
Ending June 30 Principal Interest
2025 $ 25,000 $ 358,737
2026 40,000 357,737
2027 65,000 356,137
2028 90,000 353,574
2029 115,000 350,028
2030-2034 1,005,000 1,660,685
2035-2039 1,960,000 1,411,515
2040-2044 3,430,000 838,043
2045-2049 98,387 1,330,000
Total $ 5,784,843 8,060,000 $
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
52 NOTE 8 – LONG-TERM DEBT (Continued)
F. 2017 Series Wastewater Revenue Bonds
In 2017, the Chowchilla Public Financing Authority issued Revenue Bonds in the aggregate principal amount of $3,310,000 to finance capital projects in the Sewer fund. The original amount of the bonds ($3,310,000) was secured by installment payments to be made by the City under an installment sale agreement. There is a provision whereby if the City is unable to make payment or does not comply with bond covenants, the Trustee may, and shall at the written direction of the Owners of not less than a majority in aggregate principal amount of Bonds at that time outstanding, declare the principal of all bonds outstanding and the accrued interest thereon to be due and payable immediately. These installment payments are secured by a pledge of and lien on the net revenues of the Sewer Fund. Principal is payable annually on June 1 in amounts from $75,000 to $275,000, with interest due semi-annually at variable rates between 2.33% - 4.58%, maturing on June 1, 2047.
Annual debt service requirements to maturity of the 2017 Series Wastewater Revenue Bonds are as follows:
Fiscal Year
Ending June 30 Principal Interest
2025 $ 133,531 45,000 $
2026 131,731 50,000
2027 129,731 45,000
2028 128,026 50,000
2029 126,081 60,000
2030-2034 587,313 410,000
2035-2039 479,205 630,000
2040-2044 308,000 965,000
2045-2049 70,990 750,000
Total $ 2,094,608 3,005,000 $
G. State Water Revolving Loan
The City entered into a loan agreement in July 2014 with the State Water Resources Control Board for the purpose of undertaking a project which will enable the City to meet safe drinking water standards established pursuant Chapter 4 of Part 12 of Division 104 of the health and safety Code and the California Code of Regulations, Title 22, or to address other health concerns. The City was awarded a loan in the amount of $3,205,991 for the purpose of installing water meters citywide. The loan is to be repaid over a 20-year period at an interest rate of 0%, which does not begin until the project is completed. In the event of a default, the State shall charge interest in the amount of one tenth of one percent (0.1%) of the delinquent amount each day it remains unpaid past the tenth (10th) day after the date payment was due. The City completed the project during 2018 and the first payment was due on January 1, 2019.
Annual debt service requirements to maturity of the State Water Revolving Loan are as follows:
Fiscal Year
Ending June 30 Principal
2025 $ 160,300
2026 160,300
2027 160,300
2028 160,300
2029 160,300
2030-2034 801,498
2035-2039 641,196
Total $ 2,244,194
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
53 NOTE 8 – LONG-TERM DEBT (Continued)
H. Special Assessment District Debt
On March 15, 2017, the Chowchilla Public Financing Authority (the Authority) issued $3,138,000 of 2017 Refunding Revenue Bonds (Reassessment District No 2003-1 Greenhills) for the purpose of creating annual debt savings. The total debt service payments were reduced by $140,898. The 2017 direct placement Refunding Bonds are secured by a pledge of and first lien on the revenues to be derived from the Local Agency Bonds (2003 Local Obligations). The Authority will receive the reserve fund upon final maturity. The City acts as agent for the property owners in collecting assessment installments of principal and interest and forwarding collections to the bond Trustee. The City’s liability, in the event of delinquent assessments shall not exceed the balance of the established Reserve Fund.
On April 30, 2014, the City issued $3,962,800 of 2013-1 Limited Obligation Refunding Bonds (the 2013 Local Obligations) pursuant to the provisions of the Improvement Bond Act of 1915 to refund the outstanding 2002-1 Local Obligations Improvement Bonds (the 2002-1 Local Obligations), for the purpose of creating annual debt savings. The direct placement 2013 Local Obligations are fully secured by the unpaid special assessments levied on commitment. The 2013 Local Obligations are not secured by the general taxing power of the City, the State of California, or any political subdivision of the State. The City acts as agent for the property owners in collecting assessment installments of principal and interest and forwarding collections to the bond trustee. The City’s liability in the event of delinquent assessments, shall not exceed the balance of the established Reserve Fund. The amount outstanding as of June 30, 2024 is $1,378,800.
In 2007, the City issued Community Facilities District No. 2006-1 Improvement Area 1 Special Tax Bonds in the aggregate principal amount of $8,615,000 to finance certain capital expenses of the District, to pay costs of issuance of the Bonds, and to fund two years’ capitalized interest on the Bonds. The Bonds are authorized to be issued pursuant to the MelloRoos Community Facilities Act of 1982, as amended. The Bonds ($8,615,000) are secured under the Trust indenture by a pledge and lien upon Net Taxes levied on parcels within the District and all moneys in the Special Tax Fund. The Bonds were issued for the purpose of financing the acquisition, construction, expansion, improvement, or rehabilitation of facilities to serve the area within the District and its neighboring areas. Semiannual payments range from $13,375 to $560,486 and are payable each March 1 and September 1 through 2037. The amount outstanding as of June 30, 2024 is $5,575,000.
Since the City is not obligated in any manner for special assessment debt, the debt is not recorded in these financial statements.
NOTE 9 – LEASES
A. Lease as Lessor
In 2006, the City began leasing one of its office buildings to a third party. The initial lease was for ten years and was subsequently extended with two additional five-year extensions through 2026. The City will receive monthly payments of $7,227, which is adjusted on July 1 by the United States Department of Labor, Bureau of Labor Statistics, Southern California Consumer Price Index, or 5%, whichever is less. The City recognized in lease revenue of $41,437 and $9,616 in interest revenue during the current fiscal year related to this lease. As of June 30, 2024, the City’s receivable for lease payments was $93,824. Also, the City has a deferred inflow of resources associated with this lease that will be recognized as revenue over the lease term. As of June 30, 2024, the balance of the deferred inflow of resources was $50,823.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
54 NOTE 9 – LEASES (Continued)
B. Lease as Lessee
In fiscal year 2008, the City’s Fleet Maintenance Internal Service Fund entered into a lease agreement as lessee for the acquisition and use of a building for operations. Subsequent extensions of the lease agreement have been noted through fiscal year 2025. An initial lease liability was recorded in the amount of $173,689 during fiscal year 2008. As of June 30, 2023, the value of the lease liability was $33,241. The City is required to make monthly principal and interest payments of $1,500. The lease has an effective interest rate of 7.75%. The leased building has an estimated useful life of 17 years. The value of the right-to-use asset at the end of the current fiscal year was $173,689 and had accumulated amortization of $164,867.
The City has entered into various lease agreements for vehicles, which have been recognized in accordance with GASB Statement No. 87. These leases generally have fixed payment terms over five years and do not include renewal or termination options that are reasonably certain to be exercised. Upon lease commencement, the government recorded right-to-use lease assets and corresponding lease liabilities across the applicable funds. The total initial lease liability recognized across all funds is $342,599. The right-to-use assets and accumulated amortization by fund type are as follows:
Governmental Activities (General Fund)
o Right-to-Use Asset: $265,642
o Accumulated Amortization: $24,342
Enterprise Fund (Storm Drain)
o Right-to-Use Asset: $45,135
o Accumulated Amortization: $4,136
Internal Service Fund
o Right-to-Use Asset: $67,770
o Accumulated Amortization: $4,726
Lease assets are amortized over the lease term on a straight-line basis. The annual amortization expense for fiscal year 2024 totaled $43,042.
The discount rate applied to measure lease liabilities was 8.5%. No variable lease payments, termination penalties, or other contingencies are associated with these leases.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
55 NOTE 9 – LEASES (Continued)
B. Lease as Lessee (Continued)
The future principal and interest lease payments as of June 30, 2024, are as follows:
Governmental:
Fiscal Year
Ending June 30 Principal Interest
2025 $ 74,896 $ 35,487
2026 62,734 27,251
2027 68,289 19,883
2028 74,320 11,884
2029 1,577 42,098
Total $ 96,082 322,337 $
Enterprise:
Fiscal Year
Ending June 30 Principal Interest
2025 $ 7,148 $ 3,681
2026 7,781 3,048
2027 8,470 2,359
2028 9,218 1,611
2029 503 8,597
Total $ 41,214 11,202 $
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
56 NOTE 10 – DEFERRED OUTFLOWS/INFLOWS OF RESOURCES
In addition to assets, the Statement of Net Position (and when applicable, the Balance Sheet) will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position or fund balance that applies to future period(s) and thus, will not be recognized as an outflow of resources (expense/expenditures) until then. The City has pension related items that qualify to be reported in deferred outflows of resources. The pension-related deferred outflows of resources are described in detail in Note 11.
In addition to liabilities, the Statement of Net Position (and when applicable, the Balance Sheet) will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position or fund balance that applies to future period(s) and so, will not be recognized as an inflow of resources (revenue) until that time. The City has two types of items that qualify for reporting in this category, which are unavailable revenues and pension deferrals.
Unavailable revenues arise only under a modified accrual basis of accounting and is reported only in the governmental funds Balance Sheet. Deferred inflows of resources reported in the governmental funds for unavailable revenues are as follows:
General Fund
CDBG Grants
Special Revenue
Fund
Other
Governmental
Funds Total
Intergovernmental $ - 177,830 $ 1,355,053 $ 1,532,883 $ Notes 22,569,756 - 1,633,012 24,202,768
Total $ 22,569,756 177,830 $ 2,988,065 $ 25,735,651 $
The City has pension-related items that qualify to be reported in deferred inflows of resources. The pension-related deferred inflows of resources are described in detail in Note 11.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
57 NOTE 11 – DEFINED BENEFIT PENSION PLAN
A. General Information About the Pension Plans
Plan Description
All qualified permanent and probationary employees are eligible to participate in the Public Agency Cost Sharing MultipleEmployer Plan (the Plan) administered by the California Public Employees’ Retirement System (CalPERS). The Plan consists of individual rate plans (benefit tiers) within a safety risk pool (police and fire) and a miscellaneous risk pool (all other). Plan assets may be used to pay benefits for any employer rate plan of the safety and miscellaneous pools.
Accordingly, rate plans within the safety or miscellaneous pools are not separate plans under GASB Statement No. 68.
Individual employers may sponsor more than one rate plan in the miscellaneous or safety risk pools. The City of Chowchilla (City) sponsors seven rate plans (three miscellaneous and four safety). Benefit provisions under the Plan are established by State statute and City resolution. CalPERS issues publicly available reports that include a full description of the pension plan regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.
Benefits Provided
CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full-time employment. Members with five years to total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: The Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit.
The cost-of-living adjustments for the Plan are applied as specified by the Public Employees’ Retirement law.
The rate plan provisions and benefits in effect at June 30, 2024 are summarized as follows:
Miscellaneous
1st Tier
Miscellaneous
2nd Tier
Miscellaneous
PEPRA
Prior to January 1, 2011 thru On or after
Hire date January 1, 2013 December 31, 2012 January 1, 2013 Benefit formula 2.5% @ 55 2% @ 60 2% @ 62
Benefit vesting schedule 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life Retirement age 50 - 55 50 - 63 52 - 67
Monthly benefits, as a % of annual salary 2.0% to 2.5% 1.092% to 2.418% 1.0% to 2.5% Required employee contribution rates 8% 7% 7.75%
Required employer contribution rates 14.060% 10.100% 7.680% Safety
1st Tier
Safety (Police)
2nd Tier
Safety (Police)
PEPRA
Prior to January 1, 2011 thru On or after
Hire Date January 1, 2013 December 31, 2012 January 1, 2013 Benefit formula 3% @ 55 2% @ 55 2% @ 57
Benefit vesting schedule 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life Retirement age 50 - 55 50 - 55 50 - 57
Monthly benefits, as a % of annual salary 2.4% to 3.0% 1.426% to 2.0% 1.426% to 2.0% Required employee contribution rates 9% 7% 11.0%
Required employer contribution rates 24.150% 16.450% 10.850% Beginning in fiscal year 2016, CalPERS collects employer contributions for the Plan as a percentage of payroll for the normal cost portion as noted in the rates above and as a dollar amount for contributions toward the unfunded liability and side fund, if applicable. The dollar amounts are billed on a monthly basis. The City’s contribution for the unfunded liability was $18,406 for the fiscal year ended June 30, 2024.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
58 NOTE 11 – DEFINED BENEFIT PENSION PLAN (Continued)
A. General Information About the Pension Plans (Continued) Contributions
Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires that the employer 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 determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employer contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan member contribution requirements are classified as plan member contributions.
The City’s contributions to the Plan recognized as a part of pension expense for the year ended June 30, 2024 were $738,194.
B. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions As of June 30, 2024, the City reported a net pension liability (asset) for its proportionate share of the net pension liability (asset) of the Plan of $4,315,830.
The City’s net pension liability (asset) for the Plan is measured as the proportionate share of the net pension liability (asset). The net pension liability (asset) of the Plan is measured as of June 30, 2023, and the total pension liability (asset) for the Plan used to calculate the net pension liability (asset) was determined by an actuarial valuation as of June 30, 2022, rolled forward to June 30, 2023, using standard update procedures. The City’s proportion of the net pension liability (asset) was based on a projection of the City’s long-term share of contributions to the pension plan relative to the projected contributions of all participating employers, actuarially determined. The City’s proportionate share of the net pension liability (asset) for the Plan as of June 30, 2022 and 2023 was as follows:
Proportion - June 30, 2022 0.0278%
Proportion - June 30, 2023 0.0346%
Change - Increase (Decrease) 0.0068%
For the year ended June 30, 2024, the City recognized pension expense of $2,911,323. At June 30, 2024, the City reported deferred outflows of resources and inflows of resources related to pensions from the following sources:
Deferred Deferred
Outflows of Inflows of
Resources Resources
Pension contributions subsequent to the measurement date $ 627,177 $ - Changes of assumptions 256,676 -
Differences between actual and expected experience 263,624 31,035 Net differences between projected and actual earnings on plan 650,357 - investments
Change in employer's proportion 2,920,736 -
Differences between the employer's actual contributions and the employer's proportionate share of contributions 1,818,279 - Total $ 1,849,314 4,718,570 $
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
59 NOTE 11 – DEFINED BENEFIT PENSION PLAN (Continued)
B. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continued) $627,177 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability (asset) in the year ended June 30, 2025. Other amounts reported as deferred outflow of resources and deferred inflows of resources related to pensions will be recognized as pension revenue as follows:
Year Ended
June 30
2025 $1,158,052
2026 689,654
2027 375,924
2028 18,449
2029 -
Thereafter -
The total pension liabilities (assets) in the June 30, 2022 actuarial valuations were determined using the following actuarial assumptions:
Valuation Date June 30, 2022
Measurement Date June 30, 2023
Actuarial Cost Method Entry- Age Normal Cost Method
Actuarial Assumptions:
Discount Rate 6.90%
Inflation 2.30%
Payroll Growth 2.80%
Projected Salary Increase Varies by Entry Age and Service Investment Rate of Return 6.90%(1)
Mortality Derived using CalPERS' Membership Data for
all Funds(2)
(1) Net of pension plan investment expenses, including inflation (2) The mortality table was developed based on CalPERS-specific data. The rates incorporate Generational Mortality to capture ongoing mortality improvement using 80% of Scale MP 2020 published by the Society of Actuaries.
The underlying mortality assumptions and all other actuarial assumptions used in the June 30, 2022 valuation were based on the results of 2021 actuarial experience study. Further details of the Experiences Study can be found on the CalPERS website.
C. Discount Rate
The discount rate used to measure the total pension liability (asset) was 6.90%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at 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 (asset).
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
60 NOTE 11 – DEFINED BENEFIT PENSION PLAN (Continued)
D. Actuarial Assumptions
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 expected rate of return, CalPERS took into account both short-term and long-term market return expectations as well as the expected PERF cash flows. Using historical returns of all the funds’ asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11+ years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equivalent to the single equivalent rate calculated above and adjusted to account for assumed administrative expenses.
The expected real rates of return by asset class are as follows:
Asset Class
Assumed Asset
Allocation
Real Return Years
1-10(1,2)
Global equity - cap-weighted 30.00% 4.45%
Global equity non-cap-weighted 12.00% 3.84%
Private Equity 13.00% 7.28%
Treasury 5.00% 27.00%
Mortgage-backed Securities 5.00% 50.00%
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)%
Total 100.00%
(1) An expected inflation of 2.30% used for this period. (2)
Figures are based on the 2021-22 Asset Liability Management study.
Sensitivity of the Proportionate Share of the Net Pension Liability (Asset) to Changes in the Discount Rate – The following presents the City’s proportionate share of the net pension liability (asset) for the Plan, calculated using the discount rate for the Plan, as well as what the City’s proportionate share of the net pension liability (asset) would be if it were calculated using a discount rate that is 1-percentage point lower or 1-percentage point higher than the current rate:
Discount Rate -1%
5.90%
Current Discount Rate
6.90%
Discount Rate +1%
7.90%
$ 4,315,830 10,775,803 $ (986,285) $
E. Pension Plan Fiduciary Net Position
Detailed information about the Plan’s fiduciary net position is available in the separately issued CalPERS financial reports.
F. Payable to the Pension Plan
The City had $29,196 of contributions due to the pension plan for the year ended June 30, 2024.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
61 NOTE 12 – POST-RETIREMENT HEALTH CARE BENEFITS
The City provides no post-employment benefits for its employees. However, former employees may be maintained on the City’s health insurance programs through the City’s Consolidated Omnibus Budget Reconciliation Act (COBRA) insurance continuation plan.
NOTE 13 – RISK MANAGEMENT
The City is a member, along with fifty-eight other public entities, of Central San Joaquin Valley Risk Management Authority (the Authority) organized under a joint powers agreement pursuant to the California Government Code for the purpose of operating and maintaining a cooperative program of self-insurance and risk management which benefits its member cities through cost reductions, insurance coverage stability, and loss control techniques. The Authority is governed by a Board of Directors, consisting of one member appointed by each member city. The Authority maintains pooled coverage programs for its member cities for workers’ compensation, liability, auto-physical damage, property, employment practices liability, and errors and omissions coverage. For workers’ compensation and liability programs, each program and program year is accounted for and administered as a separate operation.
Under the pooled liability program, expected claims are actuarially determined as are required deposits to cover those claims along with all estimated operating costs. Each year is retrospectively adjusted five years following its conclusion and any funds remaining are returned to the member city. Likewise, funds paid out in excess of their original deposits are collected from the member city.
The City is covered for the first $1,000,000 of each general liability claim and $500,000 of each workers’ compensation claim through the Authority. The City has the right to receive refunds of the obligation to pay assessments based on a formula which, among other expenses, charges the City’s account for liability losses under $1,000,000 and workers’ compensation losses under $500,000. The Authority is a member of the Local Agency Workers’ Compensation Excess Joint Powers Authority (LAWCX) for the purpose of providing excess coverage. Any claims of $500,000 up to $150,000,000 are covered under a purchased policy through the membership with the LAWCX. The Authority is a member of the California Affiliated Risk Management Authorities (CARMA) for the purpose of providing excess coverage in a risk sharing pool. The CARMA program provided coverage in excess for the Authority’s retained limit up to $19,000,000.
The financial position results of operations of the Authority are as follows for June 30, 2024:
Total assets $ 179,635,612
Total liabilities 144,400,470
Total net position $ 35,235,142
Revenues 95,596,916 $
Expenses 94,324,180
Change in net position $ 1,272,736
At the termination of the joint powers agreement and after all claims have been settled, any excess or deficit will be divided among the cities in accordance with its governing documents.
The City has established the following retained limits for the coverages shown: $25,000 for liability; $100,000 for worker’s compensation; $1,000 for property damage; $500 deductible on vehicles.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
62 NOTE 14 – DEFICIT IN FUND EQUITY
A. Nonmajor Governmental Funds
RSTP Fund
A deficit in fund balance at June 30, 2024, in the amount of $110,023, is due to current year expenditures in excess of revenues. This deficit is expected to be alleviated through future revenues or transfers from other funds.
SAFER Fire Grant Fund
A deficit in fund balance at June 30, 2024, in the amount of $30,529, is due to multiple years of expenditures in excess of revenues. This deficit is expected to be alleviated through future revenues or transfers from other funds.
Transit System Fund
A deficit in fund balance at June 30, 2024, in the amount of $591,425 is due to multiple years of expenditures in excess of revenues. This deficit is expected to be alleviated through future revenues or transfers from other funds.
Low and Moderate Income Housing Asset Fund
A deficit in fund balance at June 30, 2024, in the amount of $36,975, is due to current year expenditures in excess of revenues. This deficit is expected to be alleviated through future revenues or transfers from other funds.
B. Internal Service Funds
Employee Benefits Internal Service Fund
A deficit in net position at June 30, 2024, in the amount of $577,086, exists because the fund was established on a pay-asyou go basis for the purpose of funding the annual accrued leave liability. As employees are paid for their accumulated leave in the future, the fund in which their normal salary is charged makes a transfer to the Employee Benefit Fund to offset the expense.
C. Fiduciary Funds
Successor Agency Private Purpose Trust Fund
A deficit in net position at June 30, 2024, in the amount of $3,461,835, exists as a result of long-term debt in excess of assets that is in the process of being paid back in accordance with the Redevelopment dissolution. See Note 16 for more information on the Successor Agency Trust Fund.
NOTE 15 – COMMITMENTS AND CONTINGENCIES
A. General Liability
There are various claims and legal actions pending against the City for which no provision has been made in the financial statements. In the opinion of the City Attorney and City Management, liabilities arising from these claims and legal actions, if any, will not be material to these financial statements.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
63 NOTE 15 – COMMITMENTS AND CONTINGENCIES (Continued)
B. Federal Awards and Grants
The City participates in various federal grant programs, the principal of which are subject to program compliance audits pursuant to the Single Audit Act as amended. Accordingly, the government’s compliance with applicable grant requirements will be established at a future date. The amount of expenditures which may be disallowed by the granting agencies cannot be determined at this time, although the government anticipates such amounts, if any, will be immaterial.
C. Encumbrances
Encumbrance accounting is employed as an extension of formal budgetary integration for the General Fund, special revenue funds, and capital projects funds. At June 30, 2024, certain amounts which were previously restricted, committed, or assigned for specific purposes have been encumbered in the governmental funds. Significant encumbrances included in governmental fund balances are as follows:
Restricted
Fund Balance
Committed
Fund Balance
Assigned
Fund Balance
General Fund $ - $ 334,986 - $
Capital Projects Fund 41,715 - -
Nonmajor Governmental 466,695 - -
Encumbrances Included in:
NOTE 16 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X26 (the Bill) that dissolved all redevelopment agencies in the State of California. This action impacted the reporting entity of the City of Chowchilla that previously had reported a redevelopment agency within the reporting entity of the City as a blended component unit.
The Bill provides that upon dissolution of a redevelopment agency, the city of another unit of local government will agree to serve as the “Successor Agency” 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 Resolution Number 5-12.
After enactment of the law, which occurred on June 28, 2011, redevelopment agencies in the State of California cannot enter into new projects, obligations or commitments. Subject to the control of a newly established oversight board, remaining assets can only be used to pay enforceable obligations in existence at the date of dissolution (including the completion of any unfinished projects that were subject to legally enforceable contractual commitments).
In future years, successor agencies will only be allocated revenue in the amount that is necessary to pay the estimated annual installment payments on enforceable obligations of the former redevelopment agency until all enforceable obligations of the prior redevelopment agency have been paid in full and all assets have been liquidated.
The Bill directs the State Controller of the State of California to renew the propriety of any transfers of assets between redevelopment agencies and other public bodies that occurred after January 1, 2011. If the public body that received such transfers is not contractually committed to a third party for the expenditure of encumbrance of those assets, the State Controller is required to order the available assets to be transferred to the public body designated as the Successor Agency by the Bill.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
64 NOTE 16 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY (Continued) Management believes, in consultation with legal counsel, that the obligations of the former redevelopment agency due to the City are valid enforceable obligations payable by the Successor Agency trust under the requirements of the Bill. The City’s position on this issue is not a position of settled law, and there is considerable uncertainty regarding this issue. It is reasonably possible that a legal determination may be made at a later date by an appropriate judicial authority that would resolve this issue favorably to the City.
In accordance with the timeline set forth in the Bill (as modified by the California Supreme Court on December 29, 2011) all redevelopment agencies in the State of California were dissolved and ceased to operate as a legal entity as of February 1, 2012.
After the date of dissolution, the assets and activities of the dissolved redevelopment agency are reported in a fiduciary fund (private-purpose trust fund) in the financial statements of the City.
A. Cash and Investments
As of June 30, 2024, the Successor Agency has a cash and investment balance of $1,067,475.
B. Long-Term Debt
Long-term debt reported in the Successor Agency Trust Fund at June 30, 2024 was comprised of the following:
Amounts Amounts Due
June 30, June 30, Due Within More Than
2023 Additions Reductions 2024 One Year One Year
2016 Successor Agency Tax
Refunding Bond $ 4,675,000 $ (275,000) - $ $ 4,400,000 $ 285,000 $ 4,115,000 Add: Premiums 167,379 - (12,688) 154,691 - 154,691
Total 4,842,379 $ - $ (287,688) $ 4,554,691 $ 285,000 $ 4,269,691 $ C. 2016 Successor Agency Tax Allocation Refunding Bonds In 2016, the Successor Agency of the City of Chowchilla issued Tax Allocation Refunding Bonds in the aggregate principal amount of $6,190,000 to refund the 2005 RDA Tax Allocation Bonds. This was done to take advantage of lower interest rates and to save on future debt service payments. As a result, the 2005 RDA Tax Allocation Bonds are considered defeased and the liability for that bond is not included in the Fiduciary Fund (Private-Purpose Trust Fund) Statement of Net Position. The total debt service payments were reduced by $365,124. The original amount of the note, $6,190,000, was secured by a pledge of tax revenues consisting of tax increment payments to be received by the Successor Agency.
Semiannual payments range from $5,294 to $390,294 and are payable each February 1 and August 1 through 2036.
There is a provision whereby if the Successor Agency is unable to make payment, does not comply with bond covenants, or files for reorganization or arrangement, the Trustee may declare the principal of all bonds outstanding and the accrued interest thereon to be due and payable immediately.
CITY OF CHOWCHILLA | JUNE 30, 2024
Notes to the Basic Financial Statements
65 NOTE 16 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY (Continued) C. 2016 Successor Agency Tax Allocation Refunding Bonds (Continued) Annual debt service requirements to maturity of the 2016 Successor Agency Tax Allocation Refunding Bonds are as follows:
Fiscal Year
Ending June 30 Principal Interest
2025 $ 285,000 $ 121,056
2026 295,000 107,981
2027 310,000 92,856
2028 325,000 81,856
2029 330,000 75,100
2030-2034 1,730,000 258,725
2035-2039 46,728 1,125,000
Total $ 784,302 4,400,000 $
D. Insurance
The Successor Agency is covered under the City of Chowchilla’s insurance policies. Therefore, the limitation and selfinsured retentions applicable to the City also apply to the Successor Agency. Additional information as to coverage can be found in Note 13.
NOTE 17 – RESTATEMENT OF BEGINNING NET POSTION
During the year ended June 30, 2024, adjustments to opening net position were identified and corrected. A summary of the prior period adjustments are noted below.
GovernmentWide
Governmental
Activities
previously reported $ 48,911,300
Prior period adjustments:
Understatement of capital assets 1,347,802
Overstatement of accumulated depreciation 32,831
Total prior period adjustments 1,380,633
Net position, July 1, 2023, as restated $ 50,291,933
Fund balance/net position, June 30, 2023, as
66 REQUIRED SUPPLEMENTARY INFORMATION
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Budgetary Comparison Schedules
General Fund
The notes to the budgetary comparison schedules are an integral part of this statement. 67 Original Final Variance with
Budget Budget Actual Final Budget
REVENUES
Taxes $ 4,671,798 $ 5,066,495 $ 4,971,727 $ (94,768)
Licenses and permits 554,500 568,603 525,483 (43,120)
Fines and penalties 196,496 219,216 204,848 (14,368)
Intergovernmental 3,350,982 3,813,929 3,798,136 (15,793) Use of money and property 214,401 617,061 591,418 (25,643) Charges for services 348,543 440,220 399,963 (40,257)
Miscellaneous 157,263 307,750 170,988 (136,762)
Total revenues 9,493,983 11,033,274 10,662,563 (370,711)
EXPENDITURES
Current:
General government 1,462,828 1,534,058 1,219,185 314,873 Public safety 4,739,505 4,435,895 4,212,923 222,972
Culture and recreation 773,910 791,937 739,441 52,496
Community development 1,380,460 969,305 891,153 78,152
Capital outlay 1,903,799 3,873,267 2,574,502 1,298,765
Debt service:
Principal - - 23,439 (23,439)
Interest 7,508 - 4,024 3,484
Total expenditures 10,260,502 11,611,970 9,664,667 1,947,303 Excess (deficiency) of revenues
over (under) expenditures (766,519) (578,696) 997,896 1,576,592
OTHER FINANCING SOURCES (USES)
Transfers in 1,756,547 2,165,747 1,917,621 (248,126)
Transfers out (3,964,764) (4,181,974) (2,980,449) 1,201,525 Gain (loss) on sale of assets 133 5,150 5,150 -
Proceeds from long-term debt - - 265,642 265,642
Insurance recoveries 175,136 - 175,136 -
Total other financing sources (uses) (2,208,084) (1,835,941) (616,900) 1,219,041 Net change in fund balance $ (2,414,637) (2,974,603) $ 380,996 2,795,633 $ Fund balances - beginning 13,926,585
Fund balances - ending $ 14,307,581
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Budgetary Comparison Schedules
CDBG Grants Special Revenue Fund
The notes to the budgetary comparison schedules are an integral part of this statement. 68 Original Final Variance with
Budget Budget Actual Final Budget
REVENUES
Intergovernmental 1,031,223 $ 1,301,510 $ 526,634 $ (774,876) $ Use of money and property 11,314 13,856 6,199 (7,657)
Charges for services 17,293 13,596 13,593 (3,700)
Total revenues 1,332,659 1,056,133 546,426 (786,233)
EXPENDITURES
Current:
Community development 1,083,084 1,084,742 309,277 775,465 Capital outlay 4,230 - 4,228 2
Total expenditures 1,088,972 1,083,084 313,505 775,467
Excess (deficiency) of revenues
over (under) expenditures (26,951) 243,687 232,921 (10,766)
OTHER FINANCING SOURCES (USES)
Transfers in - 30,063 20,685 (9,378)
Transfers out (212,719) - (203,341) 9,378
Total other financing sources (uses) (182,656) - (182,656) - Net change in fund balance $ 61,031 (26,951) $ 50,265 $ (10,766) Fund balances - beginning 264,934
Fund balances - ending $ 315,199
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Budgetary Comparison Schedules
Impact Fees Special Revenue Fund
The notes to the budgetary comparison schedules are an integral part of this statement. 69 Original Final Variance with
Budget Budget Actual Final Budget
REVENUES
Use of money and property $ 51,556 $ 171,252 $ 167,755 $ (3,497) Charges for services 382,860 1,331,869 262,158 (120,702) Total revenues 554,112 1,383,425 429,913 (124,199)
EXPENDITURES
Current:
Public safety - 334 334 -
Highways and streets - 2,444 2,440 4
Culture and recreation - 4,681 4,681 -
Capital outlay 198,049 32,865 25,088 7,777
Total expenditures 40,324 198,049 32,543 7,781
Excess (deficiency) of revenues
over (under) expenditures 513,788 1,185,376 397,370 (116,418)
OTHER FINANCING SOURCES (USES)
Transfers out (1,200,857) (1,100,000) (481,606) 719,251 Total other financing sources (uses) (1,200,857) (1,100,000) (481,606) 719,251 Net change in fund balance $ (687,069) 85,376 $ (84,236) $ 602,833 Fund balances - beginning 4,343,387
Fund balances - ending $ 4,259,151
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Budgetary Comparison Schedules
Measure N Special Revenue Fund
The notes to the budgetary comparison schedules are an integral part of this statement. 70 Original Final Variance with
Budget Budget Actual Final Budget
REVENUES
Taxes 2,635,846 $ 2,786,496 $ 2,962,014 $ 175,518 $
Use of money and property 41,000 36,758 92,225 133,225
Miscellaneous 511 - - 511
Total revenues 2,828,007 2,672,604 3,095,750 267,743
EXPENDITURES
Current:
General government 1,296 1,645 1,645 -
Public safety 985,120 1,171,152 1,098,988 72,164
Capital outlay 100,000 100,000 100,000 -
Total expenditures 1,272,797 1,086,416 1,100,633 172,164 Excess (deficiency) of revenues
over (under) expenditures 1,555,210 1,586,188 439,907 1,995,117
OTHER FINANCING SOURCES (USES)
Transfers out (2,122,009) (1,823,114) (1,892,817) 229,192 Total other financing sources (uses) (2,122,009) (1,823,114) (1,892,817) 229,192 Net change in fund balance $ (566,799) (236,926) $ 102,300 $ 669,099 Fund balances - beginning 3,199,701
Fund balances - ending $ 3,302,001
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Notes to the Budgetary Comparison Schedules
71 NOTE 1 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY A. Budgetary Information
The City establishes annual budgets for the General, Special Revenue Funds, and Capital Projects Funds. Except for encumbrances and long-term projects in progress, which are carried forward to the following year, all appropriations remaining will lapse at year end. The following procedures are followed in establishing the budgetary data reflected in the budgetary comparison schedules:
1) The department heads prepare a budget request based upon the previous year’s expenditures. 2) A meeting is held between the department heads, Finance Director and the City Administrator for the purpose of reviewing and prioritizing the budget requests.
3) The City Administrator submits the proposed City Budget to the City Council, who makes decisions regarding department budgets.
4) The approved budget is placed in the City accounting system and monitored by the Finance Department as well as by the department heads.
5) Budgets are adopted on the modified accrual basis. Revenues are budgeted in the year receipt is expected, and expenditures are budgeted in the year that the applicable purchase orders are expected to be issued. The Debt Service Fund budget is prepared to provide funding for general obligation debt service when liabilities are due for payment. The level of control (level at which expenditures may not exceed budget) is at fund level for the General Fund, fund level for the Special Revenue Funds, and project level for the Capital Projects Funds.
B. Excess Expenditure over Appropriations
The City incurred expenditures in excess of appropriations in the following amounts for the year ended June 30, 2024:
General Fund
Debt service:
Principal (23,439)
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Cost-Sharing Multiple-Employer Defined Benefit Pension Plan Schedule of the City’s Proportionate Share of the Net Pension Liability (Asset)Last 10 Years 72 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Proportion of the net pension liability (asset) 0.1141% 0.1170% 0.1107% 0.1088% 0.1102% 0.0057% 0.0119% -0.0792% 0.0278% 0.0346%Proportionate share of the net pension liability (asset) $ 7,165,731 $ 8,032,145 $ 9,583,127 $ 10,793,945 $ 10,615,478 $ 579,267 $ 1,290,678 $ (4,281,392) $ 3,215,744 $ 4,315,830 Covered payroll $ 3,644,535 $ 3,617,983 $ 3,411,501 $ 3,728,201 $ 3,960,212 $ 3,991,276 $ 4,313,602 $ 4,489,333 $ 4,742,624 $ 5,092,237 Proportionate share of the net pension liability (asset) as a percentage of covered payroll 196.62% 222.01% 280.91% 289.52% 268.05% 14.51% 29.92% -95.37% 67.81% 84.75%Plan fiduciary net position as a percentage of the total pension liability (asset) 78.02% 74.09% 70.07% 69.45% 70.84% 99.14% 97.37% 110.81% 93.14% 91.38%Notes to Schedule:
Change in Assumptions - None
Change in Benefit Terms - In 2022, SB 1168 increased the standard retiree lump sum death benefit from $500 to $2,000 for any death occurring on or after July 1, 2023. The impact from this change is deemed to be immaterial and is included in Differences Between Expected and Actual Experience.
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Cost-Sharing Multiple-Employer Defined Benefit Pension Plan Schedule of ContributionsLast 10 Years 73 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Actuarily required contribution (actuarially determined) $ 848,864 745,347 $ 942,347 $ 1,034,227 $ 694,478 $ 523,962 $ 648,797 $ 678,921 $ 738,194 $ 627,177 $ Contributions in relation to the actuarially determined contributions 848,864 745,347 942,347 1,034,227 11,304,271 523,962 648,797 678,921 738,194 627,177 Contribution deficiency (excess) $ - - $ - $ - $ (10,609,793) $ - $ - $ - $ - $ - $ Covered payroll 3,617,983 $ 3,411,501 $ 3,728,201 $ 3,960,212 $ 3,991,276 $ 4,313,602 $ 4,892,282 $ 4,742,624 $ 5,092,237 $ 5,312,564 $ Contributions as a percentage of covered payroll 20.60% 24.88% 25.28% 26.12% 283.22% 12.15% 13.26% 14.32% 14.50% 11.81% 74 SUPPLEMENTARY INFORMATION
CITY OF CHOWCHILLA | JUNE 30, 2024
Nonmajor Special Revenue Funds
Combining Balance Sheet
75 State Street & SAFER Fire Measure T
Gas Tax SB1 RSTP Road (LTF) Grant Fund Fund
ASSETS
Cash and investments $ 1,780,138 $ 846,194 $ 2,295,316 - $ $ 2,014,078 - $ Intergovernmental receivables 43,425 86,773 209,862 924,811 516,392 - Notes receivable, net - - - - - -
Prepaid expenses - - - - - -
Total assets 1,823,563 $ 932,967 $ 209,862 $ 3,220,127 $ - $ 2,530,470 $
LIABILITIES
Accounts payable 11,026 $ - $ $ 885,088 - $ $ 33 $ -
Retainage payable - - - 41,744 - -
Due to other funds - - 111,570 - 30,496 -
Total liabilities 11,026 - 111,570 926,832 30,529 -
DEFERRED INFLOWS OF RESOURCES
Unavailable revenues - - 208,315 550,864 - 336,814
Total deferred inflows of resources - - 208,315 550,864 - 336,814
FUND BALANCES (DEFICIT)
Nonspendable
Prepaid expenses - - - - - -
Restricted for:
Highway and streets 1,812,537 932,967 1,742,431 - 2,193,656 - Community development - - - - - -
Unassigned - - (110,023) - (30,529) -
Total fund balances (deficit) 932,967 1,812,537 (110,023) 1,742,431 (30,529) 2,193,656 Total liabilities, deferred inflows
of resources, and fund balances $ 932,967 1,823,563 $ 209,862 $ 3,220,127 $ - $ 2,530,470 $ CITY OF CHOWCHILLA | JUNE 30, 2024
Nonmajor Special Revenue Funds
Combining Balance Sheet
(Continued)
76 Low and
Home Moderate
Maintenance Investment Income
Assessment Transit Partnership EDBG Housing
District System Program Grants Asset Fund Total
ASSETS
Cash and investments $ 693,342 $ 1,697,717 - $ 25,252 $ - $ 9,352,037 $ Intergovernmental receivables 9,205 280,841 162,067 - 2,233,376 - Notes receivable, net - 1,564,162 - - 68,850 1,633,012
Prepaid expenses - - 12,152 - - 12,152
Total assets 702,547 $ 292,993 $ 3,423,946 $ 25,252 $ 68,850 $ 13,230,577 $
LIABILITIES
Accounts payable $ 12,664 $ 26,155 $ 20,365 $ - $ 955,331 - $ Retainage payable - - - - - 41,744
Due to other funds 601,694 - - - 36,975 780,735
Total liabilities 12,664 627,849 20,365 - 36,975 1,777,810
DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 256,569 2,491 1,564,162 - 68,850 2,988,065 Total deferred inflows of resources 256,569 2,491 1,564,162 - 68,850 2,988,065
FUND BALANCES (DEFICIT)
Nonspendable
Prepaid expenses - 12,152 - - - 12,152
Restricted for:
Highway and streets - 687,392 - - - 7,368,983
Community development - - 1,839,419 25,252 - 1,864,671
Unassigned - (603,577) - - (36,975) (781,104)
Total fund balances (deficit) (591,425) 687,392 1,839,419 25,252 (36,975) 8,464,702 Total liabilities, deferred inflows
of resources, and fund balances $ 292,993 702,547 $ 3,423,946 $ 25,252 $ 68,850 $ 13,230,577 $ CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Nonmajor Special Revenue Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances 77 State Street & SAFER Fire Measure T
Gas Tax SB1 RSTP Road (LTF) Grant Fund Fund
REVENUES
Intergovernmental 503,889 $ 497,902 $ 375,824 $ 1,032,451 $ - $ 717,552 $ Use of money and property 66,734 44,790 - 32,824 - 89,217 Charges for services - - - - - -
Miscellaneous - - - 420 85 -
Total revenues 570,623 542,692 375,824 1,065,695 85 806,769
EXPENDITURES
Current:
General government - - - 3,059 - -
Public safety - - - - 3,047 -
Highway and streets 44,735 824 - 436,422 - 8,035
Community development - - - - - -
Capital outlay - - - 1,127,455 - -
Debt service:
Principal - - - 3,644 - -
Interest - - - 1,522 - -
Total expenditures 824 44,735 - 1,572,102 3,047 8,035
Excess (deficiency) of revenues
over (under) expenditures 541,868 525,888 375,824 (506,407) (2,962) 798,734
OTHER FINANCING SOURCES (USES)
Transfers in - 14,502 - 1,270,276 - -
Transfers out (540,558) (144,473) (209,862) (175) - (473,733) Total other financing sources (uses) (526,056) (144,473) (209,862) 1,270,101 - (473,733) Net change in fund balances 381,415 15,812 165,962 763,694 (2,962) 325,001 917,155 1,431,122 (275,985) 978,737 (27,567) 1,868,655
$ 932,967 1,812,537 $ (110,023) $ 1,742,431 $ (30,529) $ 2,193,656 $ Fund balances (deficit) - beginning
Fund balances (deficit) - ending
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Nonmajor Special Revenue Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances (Continued)
78 Low and
Home Moderate
Maintenance Investment Income
Assessment Transit Partnership EDBG Housing
District System Program Grants Asset Fund Total
REVENUES
Intergovernmental $ 5,443 $ 513,267 $ 641,598 $ - $ 4,287,926 - $ Use of money and property 25,165 - 49,506 1,689 309,925 - Charges for services 308,257 19,211 - - 327,468 -
Miscellaneous 5,341 - - - - 5,846
Total revenues 338,865 537,819 691,104 1,689 - 4,931,165
EXPENDITURES
Current:
General government - 2,484 - - - 5,543
Public safety - - - - - 3,047
Highway and streets 325,961 560,172 - - - 1,376,149
Community development - - 3,125 28 - 3,153
Capital outlay 12,800 - 173,480 - - 1,313,735
Debt service:
Principal - - - - - 3,644
Interest - - - - - 1,522
Total expenditures 325,961 575,456 176,605 28 - 2,706,793 Excess (deficiency) of revenues
over (under) expenditures (37,637) 12,904 514,499 1,661 - 2,224,372
OTHER FINANCING SOURCES (USES)
Transfers in - - - - - 1,284,778
Transfers out - - - (20,685) - (1,389,486)
Total other financing sources (uses) - - - (20,685) - (104,708) Net change in fund balances 12,904 (37,637) 514,499 (19,024) - 2,119,664 674,488 (553,788) 1,324,920 44,276 (36,975) 6,345,038
Fund balances (deficit) - ending $ (591,425) 687,392 $ 1,839,419 $ 25,252 $ (36,975) $ 8,464,702 $ Fund balances (deficit) - beginning
CITY OF CHOWCHILLA | JUNE 30, 2024
Nonmajor Enterprise Funds
Combining Statement of Net Position
79 (Formerly
nonmajor fund)
Storm Drain Airport Total
ASSETS
Current assets:
Cash and investments - $ 241,099 $ 241,099 $
Accounts receivable, net - - -
Intergovernmental receivables 11,893 - 11,893
Total current assets 252,992 - 252,992
Noncurrent assets:
Capital assets:
Nondepreciable - 452,951 452,951
Depreciable, net of accumulated depreciation 304,661 - 304,661 Total noncurrent assets 757,612 - 757,612
Total assets 1,010,604 - 1,010,604
DEFERRED OUTFLOWS OF RESOURCES
Contributions to pension plan in current fiscal year - 1,502 1,502 Deferred outflows of resources from pensions 9,813 - 9,813 Total deferred outflows of resources 11,315 - 11,315
LIABILITIES
Current liabilities:
Accounts payable 549 - 549
Total current liabilities 549 - 549
Noncurrent liabilities:
Net pension liability 9,774 - 9,774
Total noncurrent liabilities 9,774 - 9,774
Total liabilities 10,323 - 10,323
DEFERRED INFLOWS OF RESOURCES
Deferred inflows of resources from pensions 3,998 - 3,998 Total deferred outflows of resources 3,998 - 3,998
NET POSITION
Net investment in capital assets - 757,612 757,612
Unrestricted 249,986 - 249,986
Total net position $ 1,007,598 - $ 1,007,598 $
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Nonmajor Enterprise Funds
Combining Statement of Revenues, Expenses and Changes in Net Position 80 (Formerly
nonmajor fund)
Storm Drain Airport Total
Operating revenues:
Charges for services - $ 43,823 $ 43,823 $
Miscellaneous - 1,999 1,999
Total operating revenues 45,822 - 45,822
Operating expenses:
Personnel services - 22,563 22,563
Materials, supplies and services - 16,294 16,294
Depreciation and ammortization 26,713 - 26,713
Total operating expenses 65,570 - 65,570
Operating income (loss) (19,748) - (19,748)
Nonoperating revenues (expenses):
Use of money and property - 8,671 8,671
Taxes - 14,237 14,237
Grants - capital 10,000 - 10,000
Total nonoperating revenues (expenses) 32,908 - 32,908
Change in net position 13,160 - 13,160
Fund balances - beginning, as previously presented 4,185,627 994,438 5,180,065 - (4,185,627) (4,185,627)
Net assets, beginning of year, restated - 994,438 994,438 Net position - ending $ 1,007,598 - $ 1,007,598 $
Change within financial reporting entity (nonmajor to
major)
CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Nonmajor Enterprise Funds
Combining Statement of Cash Flows
81 Airport
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers and users $ 43,823
Payments to suppliers (25,831)
Payments to employees (16,522)
Other operating revenues 1,999
3,469
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES
Grants received -
Transfer from other funds -
Taxes received 14,237
14,237
Grants received 28,722
Acquisition of capital assets -
activities 28,722
CASH FLOWS FROM INVESTING ACTIVITIES
8,671
8,671
55,099
186,000
$ 241,099
Cash and cash equivalents - beginning
Cash and cash equivalents - ending
Net cash provided by investing activities
Net cash provided by (used for) capital and related financing Interest received
Net increase (decrease) in cash and cash equivalents
Net cash provided by (used for) operating activities
Net cash provided by (used for) noncapital financing activities
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Nonmajor Enterprise Funds
Combining Statement of Cash Flows
(Continued)
82 Airport
Operating income (loss) $ (19,748)
Depreciation 26,713
(Increase) decrease in:
Accounts receivable -
Deferred outflows of resources from pensions 3,112
Increase (decrease) in:
Accounts payable and other liabilities (9,537)
Net pension liability 3,135
Deferred inflows of resources from pension (206)
Net cash provided by (used for) operating activities $ 3,469 Reconciliation of operating income (loss) to net
cash provided by (used for) operating activities:
Adjustments to reconcile operating income (loss) to net cash provided by (used in) operating activities:
CITY OF CHOWCHILLA | JUNE 30, 2024
Internal Service Funds
Combining Statement of Net Position
83 Fleet Information Employee
Maintenance Technology Benefits Total
ASSETS
Current assets:
Cash and investments 19,405 $ - $ 151,268 $ 170,673 $
Accounts receivable, net 545 - - 545
Prepaid expenses 3,175 - 13,909 17,084
Total current assets 3,175 19,950 165,177 188,302
Noncurrent assets:
Capital assets:
Nondepreciable - 172,862 - 172,862
Depreciable, net of accumulated
depreciation/amortization 267,266 58,945 - 326,211
Total noncurrent assets 440,128 58,945 - 499,073
Total assets 443,303 78,895 165,177 687,375
DEFERRED OUTFLOWS OF RESOURCES
Contributions to pension plan in current fiscal year 14,288 19,344 - 33,632 Deferred outflows of resources from pensions 126,118 90,961 - 217,079 Total deferred outflows of resources 105,249 145,462 - 250,711
LIABILITIES
Current liabilities:
Accounts payable 11,090 11,254 2,232 24,576
Accrued payroll - 175,656 - 175,656
Due to other funds 120,830 - 120,830 -
Compensated absences - 383,919 - 383,919
Subscription liability - current - 19,845 - 19,845
Current portion of lease liabilities 4,522 24,413 - 28,935 Total current liabilities 156,451 35,503 561,807 753,761 Noncurrent liabilities:
Compensated absences - - 180,456 180,456
Net pension liability 125,865 92,969 - 218,834
Lease liabilities 20,819 30,380 - 51,199
Total noncurrent liabilities 123,349 146,684 180,456 450,489 Total liabilities 158,852 303,135 742,263 1,204,250
DEFERRED INFLOWS OF RESOURCES
Deferred inflows of resources from pensions 51,339 37,445 - 88,784 Total deferred inflows of resources 51,339 37,445 - 88,784
NET POSITION (DEFICIT)
Net investment in capital assets 34,532 435,606 - 470,138 Unrestricted (deficit) (46,685) (201,315) (577,086) (825,086) Total net position (deficit) $ 234,291 (12,153) $ (577,086) $ (354,948) $ CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Internal Service Funds
Combining Statement of Revenues, Expenses and Changes in Net Position 84 Fleet Information Employee
Maintenance Technology Benefits Total
Operating revenues:
Charges for services $ 606,304 295,948 $ - $ 902,252 $
Miscellaneous 179 639 - 818
Total operating revenues 296,587 606,483 - 903,070
Operating expenses:
Personnel services 236,251 329,618 46,073 611,942
Materials, supplies and services 96,322 354,445 - 450,767 Depreciation and amortization 62,694 15,063 - 77,757
Total operating expenses 746,757 347,636 46,073 1,140,466 Operating income (loss) (51,049) (140,274) (46,073) (237,396) Nonoperating revenues (expenses):
Interest expense (3,414) (368) - (3,782)
Total nonoperating revenues (expenses) (368) (3,414) - (3,782) Change in net position (54,463) (140,642) (46,073) (241,178) Net position (deficit) - beginning 374,933 42,310 (531,013) (113,770) Net position (deficit) - ending $ 234,291 (12,153) $ (577,086) $ (354,948) $ CITY OF CHOWCHILLA | FOR THE YEAR ENDED JUNE 30, 2024
Internal Service Funds
Combining Statement of Cash Flows
85 Fleet Information Employee
Maintenance Technology Benefits Total
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers and users 295,583 $ 606,188 $ - $ 901,771 $ Payments to suppliers (86,875) (356,019) - (442,894)
Payments to or received from employees (178,727) (252,277) (45,930) (476,934) Other operating revenues 179 639 - 818
(1,929) 30,620 (45,930) (17,239)
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES
Loan from other funds 97,760 - - 97,760
activities - 97,760 - 97,760
ACTIVITIES
Leases paid 18,138 24,973 - 43,111
Acquisition of capital assets (41,171) (120,804) - (161,975) (23,033) (95,831) - (118,864)
Net increase (decrease) in cash and cash equivalents 7,587 - (45,930) (38,343) - 11,818 197,198 209,016
$ 19,405 - $ 151,268 $ 170,673 $
Net cash provided by (used for) operating activities
Net cash provided by (used for) noncapital financing
CASH FLOWS FROM CAPITAL AND RELATED FINANCING
Cash and cash equivalents - beginning
Cash and cash equivalents - ending
Net cash provided by (used for) related financing activities Fleet Information Employee
Maintenance Technology Benefits Total
Operating income (loss) $ (51,049) $ (140,274) $ (46,073) $ (237,396) Depreciation 15,063 62,694 - 77,757
(Increase) decrease in:
Accounts receivable (365) (116) - (481)
Prepaid expenses - 476 (22,350) (21,874)
Net pension asset 32,682 40,458 - 73,140
Deferred outflows of resources from pensions 26,949 40,053 - 67,002 Increase (decrease) in:
Accounts payable and other liabilities 9,447 (2,050) (23,580) (16,183) Compensated absences - - 46,073 46,073
Deferred inflows of resources from pensions (3,170) (2,107) - (5,277) Net cash provided by (used for) operating activities 30,620 $ (1,929) $ (45,930) $ (17,239) $ Adjustments to reconcile operating income (loss) to net cash provided by (used for) operating activities:
Reconciliation of operating income (loss) to net cash provided by (used for) operating activities:
CITY OF CHOWCHILLA | JUNE 30, 2024
Custodial Funds
Combining Statement of Fiduciary Net Position
86 Community
Facilities
District
Greenhills
Assessment
District
Pheasant Run
Assessment
District
Total Custodial
Funds
ASSETS
Cash and investments (in City investment pool) $ 802,584 $ 260,627 $ 723,985 $ 1,787,196 Restricted cash with fiscal agents 611,413 - 87,868 699,281 Accounts receivable (net) 10,902 2,878 2,954 16,734
Total assets 271,529 1,416,875 814,807 2,503,211
LIABILITIES
Accounts payable 1,586 - 2,137 3,723
Total liabilities - 1,586 2,137 3,723
NET POSITION
Restricted for:
Individuals, organizations, and other governments 271,529 1,415,289 812,670 2,499,488 Total net position 1,415,289 $ 271,529 $ 812,670 $ 2,499,488 $ CITY OF CHOWCHILLA | JUNE 30, 2024
Custodial Funds
Combining Statement of Changes in Fiduciary Net Position 87 Community
Facilities
District
Greenhills
Assessment
District
Pheasant Run
Assessment
District
Total Custodial
Funds
ADDITIONS
Property tax collections $ 12,589 583,410 $ 460,613 $ 1,056,612 $ Investment earnings 11,312 122,083 26,683 160,078
Total additions 23,901 705,493 487,296 1,216,690
DEDUCTIONS
Payments to bondholders 531,261 555,500 373,999 1,460,760 Administrative expenses 12,415 89,533 20,453 122,401
Total deductions 543,676 645,033 394,452 1,583,161
Change in fiduciary net position 60,460 (519,775) 92,844 (366,471) Net position - beginning 791,304 1,354,829 719,826 2,865,959 Net position - ending $ 271,529 1,415,289 $ 812,670 $ 2,499,488 $ March 25, 2025
To the Honorable Mayor and City Council
City of Chowchilla, California
We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City Chowchilla, California (the City) for the year ended June 30, 2024.
Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards, Government Auditing Standards and the Uniform Guidance, as well as certain information related to the planned scope and timing of our audit. We have communicated such information in our engagement letter previously provided to you. Professional standards also require that we communicate to you the following information related to our audit.
Significant Audit Matters
Qualitative Aspects of Accounting Practices
Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in Note 1 to the financial statements. No new accounting policies were adopted and the application of existing policies was not changed during 2024. We noted no transactions entered into by the City during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period.
Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the City’s financial statements were:
Management’s estimate of the allowance for doubtful accounts is based on historical revenues and analysis of the collectability of individual accounts. We evaluated the methods, assumptions, and data used to develop the allowance for doubtful accounts estimate in determining that it is reasonable in relation to the financial statements taken as a whole.
Management’s estimate of the City-Wide Cost Allocation Plan, as approved in the annual budget, is based on past history, planned future activity, and other factors significant to the City’s operations that are required to support each operating department. We evaluated the methodology used by management to create this estimate and believe that it is reasonable in relation to the financial statements taken as a whole.
Management’s estimate of the net pension liability and related deferrals is based on actuarial valuations which include significant assumptions regarding discount rate, inflation, payroll growth, projected salary increases and investment rate of return. We evaluated the key factors and assumptions used to develop the liability and related deferrals in determining that it is reasonable in relation to the financial statements taken as a whole.
Certain financial statement disclosures are particularly sensitive because of their significance to financial statement users.
The most sensitive disclosure affecting the financial statements was :
The disclosure of the City’s defined benefit pension plan in Note 11 to the financial statements provides detailed information on the pension plan including a description of the plan, benefits provided, contributions, calculation of the net pension liability/asset and related deferrals, actuarial assumptions, and discount rate used to measure the net pension liability/asset.
The financial statement disclosures are neutral, consistent, and clear.
Difficulties Encountered in Performing the Audit
We encountered no significant difficulties in dealing with management in performing and completing our audit.
Corrected and Uncorrected Misstatements
Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are clearly trivial, and communicate them to the appropriate level of management. The attached schedule, “Uncorrected Audit Differences,” summarizes uncorrected misstatements of the financial statements. Management has determined that their effects are immaterial, both individually and in the aggregate, to the financial statements taken as a whole. The uncorrected misstatements or the matters underlying them could potentially cause future period financial statements to be materially misstated, even though, in our judgement, such uncorrected misstatements are immaterial to the financial statements under audit. In addition, the adjustments noted in the “Corrected Material Audit Adjustments” attachment represent the material misstatements detected as a result of audit procedures that were corrected by management.
Disagreements with Management
For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor’s report. We are pleased to report that no such disagreements arose during the course of our audit.
Management Representations
We have requested certain representations from management that are included in the management representation letter.
Management Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation involves application of an accounting principle to the City’s financial statements or a determination of the type of auditor’s opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants.
Other Audit Findings or Issues
We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the City’s auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention.
In our audit engagement letter previously provided to you, we communicated the following significant risks of material misstatement (significant risks) as part of our audit planning:
Management override of controls
Improper revenue recognition due to fraud
During the course of the audit, we identified additional significant risks:
Transfers from restricted funds are not ultimately used for the purpose of the original restriction.
These risks were addressed within our audit procedures and we have no findings to report related to these risks.
Other Matters
We applied certain limited procedures to management’s discussion and analysis, budgetary comparison schedules, proportionate share of net pension liability, and schedule of contributions, which are required supplementary information (RSI) that supplements the basic financial statements. Our procedures consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI.
We were engaged to report on the combining nonmajor fund financial statements and the related budgetary comparison schedules, which accompany the financial statements but are not RSI. With respect to this supplementary information, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves.
Restriction on Use
This information is intended solely for the information and use of the City Council and management of the City and is not intended to be, and should not be, used by anyone other than these specified parties.
Very truly yours,
Client: CHOWCHILLA, CITY OF
Engagement: 6-30-24 AuditCurrent Period: 06/30/2024Workpaper: Attachment: Uncorrected Audit DifferencesAccount Description Misstatement Workpaper Reference Debit Credit Net Income Effect
Workpaper ID
PJE01
Known Classification
To correct land donation recorded in the fund financials 100-6620-6100 Land 0.00 25,000.00 100-6620-8756 Donations/Projects 25,000.00 0.00 Total 25,000.00 25,000.00 0.00 GRAND TOTAL 25,000.00 25,000.00 0.00