CITY OF CHULA VISTA, CALFORNIA
2016 MEASURE P SALES TAX FUND
FOR THE YEAR ENDED JUNE 30, 2021
REPORT ON COMPLIANCE WITH THE
INFRASTRUCTURE, FACILITIES
AND EQUIPMENT PLAN
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203 N. Brea Blvd., Suite 203
Brea, CA 92821 Lance, Soll & Lunghard, LLP Phone: 714.672.0022
INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE WITH APPLICABLE
REQUIREMENT AND ON INTERNAL CONTROL OVER COMPLIANCE
To the Honorable Mayor and Members of the City Council
City of Chula Vista, California
Report on Compliance
Opinion on the 2016 Measure P Sales Tax Fund
We have audited the compliance of the 2016 Measure P Sales Tax Fund of the City of Chula Vista, California (the “City”) with the requirements described in Ordinance No. 3371 (the Ordinance) and the Infrastructure, Facilities and Equipment Expenditure Plan (the Spending Plan) for the year ending June 30, 2021.
In our opinion, the City complied, in all material respects, wi th the types of compliance that could have a direct and material effect on the requirements referred to abov e applicable to the 2016 Measure P Sales Tax Fund for the year ended June 30, 2021.
Basis for Opinion
We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America (GAAS); the standards applicable to fi nancial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States; and t he requirements described in the Ordinance and the Spending Plan. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of Compliance section of our report.
We are required to be independent of the City, and to meet our other ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Our audit does not provide a legal determination of the City’s compliance with the compliance requirements referred to above.
Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design, implementation, and maintenance of effective internal control o ver compliance with the requirements of laws, statutes, regulations, rules, and provisions of contracts or grant agreements applicable to the City’s government programs.
Auditor’s Responsibilities for the Audit of Compliance
Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above, whether due to fraud or error, and express an opinion on the City’s compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an aud it conducted in accordance with GAAS, Government Auditing Standards will always detect material noncompliance when it exists. The r isk of
To the Honorable Mayor and Members of the City Council
City of Chula Vista, California
not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, mi srepresentations, or the override of internal control. Noncompliance with the compliance requirements referr ed to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about the City ’s compliance with the requirements described in the Ordinance and the Spending Plan.
In performing an audit in accordance with GAAS, Government Auditing Standards, and the compliance requirements referred to above, we:
Exercise professional judgment and maintain professional skepticism throughout the audit
Identify and assess the risks of material noncompliance, wheth er 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 City's compliance with the compliance requirements referred to above and performing such other proced ures as we considered necessary in the circumstances.
Obtain an understanding of the Ci ty’s internal control over co mpliance relevant to the audit in order to design audit procedures that are appropriate in the ci rcumstances and to test and report on internal control over compliance in accordance with the Ordinance and the Spending Plan, but not for the purpose of expressing an opinion on the effectivene ss of the City’s internal control over compliance. Accordingly, no such opinion is expressed.
We are required to communicate with those charged with governan ce regarding, among other matters, the planned scope and timing of the audit, and any significant deficiencies and material weaknesses in internal control over compliance that we identified during the audit.
Report on Internal Control Over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the norma l course of performing their assigned functions, to prevent, or detect and correct, noncompliance on a timely basis. A material weakness i n internal control over compliance is a deficiency, or combinatio n of deficiencies in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a compliance requirement will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combinat ion of deficiencies, in internal control over compliance that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal cont rol over compliance was for t he limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant def iciencies in internal control over compliance. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal control over compliance may exist that have not been identified.
Our audit was not designed for the purpose of expressing an opi nion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.
2 To the Honorable Mayor and Members of the City Council City of Chula Vista, California
Purpose of this Report
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements described in the Ordinance and t he Spending Plan. Accordingly, this report is not suitable for any other purpose.
Brea, California
December 28, 2021
3 Pooled cash and investments 34,867,736$
Restricted assets - cash and investments 181
Accrued interest receivable 21
Prepaid expenses 170,238
Total Assets 35,038,176$
Liabilities and Fund Balance:
Liabilities:
Accounts payable 760,168$
Retention payable 902,736
Total Liabilities 1,662,904
Assigned for Measure P Sales Tax 33,375,272
Total Fund Balance 33,375,272
Total Liabilities and Fund Balance 35,038,176$
CITY OF CHULA VISTA
Fund Balance:
Assets:
JUNE 30, 2021
BALANCE SHEET
SCHEDULES OF 2016 MEASURE P SALES TAX FUND
4 STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE JUNE 30, 2021
Revenues:
Local sales and use tax 23,629,265$
Use of money and property 285,712
Miscellaneous 3,038
Total Revenues 23,918,015
Expenditures:
Contracted services 22,364
Equipment and shared infrastructure costs 428,958
Capital outlay 23,636,983
Debt service:
Principal retirement 763,233
Interest and fiscal charges 134,388
Total Expenditures 24,985,926
Excess (Deficiency) of Revenues
Over (under) Expenditures (1,067,911)
Other Financing Sources (Uses):
Transfers Out - Municipal Financing Authority Fund (8,128,500) Total Other Financing Sources (Uses) (8,128,500)
Net Change in Fund Balance (9,196,411)
Fund Balance - Beginning 42,571,683
Fund Balance - Ending 33,375,272$
SCHEDULES OF 2016 MEASURE P SALES TAX FUND
CITY OF CHULA VISTA
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