Compton City Council
June 11, 2024

Members of the public may address the City Council on any item shown on the agenda or matter of the Council’s authority after completion of “Request to Address the Council Form” available in the lobby of the Council Chambers or in the City Clerk’s office. This form must be completed 15 minutes prior to the scheduled meeting time. Pursuant to Section 54957.5 of the California Government Code, Any writings (Except for those writings which are exempt from disclosure) which are
distributed to all or a majority of the members of the City Council are available for public inspection in the lobby of the City Council Chambers and in the office of the City Clerk during regular business hours.

COMPTON CITY COUNCIL
AGENDA
06/11/2024
CLOSED SESSION – 4:00 PM
PUBLIC MEETING – 5:30 PM
PUBLIC HEARING – 5:45 PM

HEARING(S)
PUBLIC HEARING: FOR THE CONSIDERATION OF THE PROPOSED FISCAL YEAR 2024-25 BUDGET @ 5:45PM

OPENING

MOMENT OF SILENCE

PLEDGE OF ALLEGIANCE

ROLL CALL

PUBLIC COMMENT ON CLOSED SESSION ITEMS ONLY
-2- City Council Agenda
6/11/2024 5:30 PM

CLOSED SESSION

PUBLIC EMPLOYEE PERFORMANCE EVALUATION
Title: City Controller
Pursuant to California Government Code Section 54957
PUBLIC MEETING – 5:30 PM

REPORT ON CLOSED SESSION ACTIONS

PUBLIC COMMENTS ON AGENDA ITEMS AND NON-AGENDA MATTERS

CONSENT AGENDA
Consent items are routine and expected to be non-controversial. They will be acted upon by the Council at one time without discussion unless a Council Member requests an item be removed or discussed..

APPROVAL OF MINUTES

1. October 3, 2023

2. October 10, 2023

3. April 23, 2024

RECREATION DEPARTMENT

4. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

AUTHORIZING THE CITY MANAGER TO OPEN A PURCHASE ORDER WITH

STAPLES ADVANTAGE TO PAY INVOICES FOR OFFICE SUPPLIES FROM FISCAL YEAR 2023-2024 IN THE AMOUNT OF $1075.61

REGULAR AGENDA

CITY MANAGER'S REPORT

5. REQUEST TO AUTHORIZE TRAVEL FOR ELECTED OFFICIALS - 92nd ANNUAL MEETING SPONSOR BY US CONFERENCE OF MAYORS JUNE 20,2024 THROUGH JUNE 23,2024
-3- City Council Agenda
6/11/2024 5:30 PM

UNFINISHED BUSINESS

6. CITY MANAGER/CITY ATTORNEY/CITY CONTROLLER/CITY TREASURER

REPORTS
A REQUEST TO RECEIVE AND FILE THE FISCAL YEAR 2020-
2021 AUDITED FINANCIAL STATEMENTS, THE FISCAL YEAR
2020-2021 SINGLE AUDIT REPORT, AND THE FISCAL YEAR
2020-2021 UNAUDITED MANAGEMENT’S DISCUSSION AND

ANALYSIS OF THE CITY OF COMPTON

APPROVAL OF WARRANTS

COUNCIL COMMENTS

ADJOURNMENT
NEXT REGULAR MEETING: 6/18/2024 5:30 PM
Visit our website at http://www.comptoncity.org
OCTOBER 3, 2023
The Compton City Council meeting was called to order at 4:37 p.m. by Mayor Emma Sharif in the Council Chambers of City Hall. The Moment of Silence Ceremony and the Pledge of Allegiance were also led by Mayor Emma Sharif.

ROLL CALL
Council Members Present: D. Duhart, A. Spicer, J. Bowers, Mayor E. Sharif Council Members Absent: L. Darden

Other Officials Present: E. Perrodin, V. McDaniel, B. Mims, J. Groomes

PUBLIC COMMENTS ON CLOSED SESSION ITEMS ONLY - (NONE)

CLOSED SESSION
PEREZ, SALVADOR V. CITY OF COMPTON – LASC Case No. 21 STCV 27741 RODRIGUEZ, ORLANDO V. CITY OF COMPTON – LASC Case No. 22 STCV 13989 ALLEN, SHAKIRYA V. CITY OF COMPTON – LASC Case No. 21 STCV 43183 PURSUANT TO SECTION 54956.9(A)
ARAIZA, MARGARITA V. CITY OF COMPTON – LASC Case No. 22 CMCV 00402 ARAIZA, MARGARITA V. CITY OF COMPTON – LASC Case No. 22 STCV 23172 HALLOWAY, ARTURIOR V. CITY OF COMPTON – LASC Case No. 20 STCV 09528 PURSUANT TO SECTION 54956.9(A)
HILL, SUSAN V. CITY OF COMPTON – LASC Case No. 21 STCV 37464 AGEE, KADELL V. CITY OF COMPTON – LASC Case No. 22 STCV 13529 ZURITA, SATRA V. CITY OF COMPTON – WC 00000717A (CC056GVv) PURSUANT TO SECTION 54956.9(A)
On motion by Duhart, seconded by Spicer, to recess the City Council meeting to closed session at 4:40 p.m. by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Sharif NOES: Council Members – None
ABSENT: Council Members – Darden
On motion by Darden, seconded by Duhart, to reconvene the City Council meeting at 6:12 p.m. by the following vote on roll call:

AYES: Council Members – Duhart, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – Spicer

REPORT OUT ON CLOSED SESSION ACTION(S)
City Attorney Perrodin reported out that City Council met in closed session regarding Perez, Salvador v. City Of Compton – LASC Case No. 21 STCV 27741, Rodriguez, Orlando v. City Of Compton – LASC Case No. 22 STCV 13989, Allen, Shakirya v. City Of Compton – LASC Case No. 21 STCV 43183, Araiza, Margarita v. City Of Compton – LASC Case No. 22 CMCV 00402, Araiza, Margarita v. City Of Compton – LASC Case No. 22 STCV 23172, Halloway, Arturior v.

City Of Compton – LASC Case No. 20 STCV 09528, Hill, Susan v. City Of Compton – LASC Case No. 21 STCV 37464, Agee, Kadell v. City Of Compton – LASC Case No. 22 STCV 13529, Zurita, Satra v. City Of Compton – WC 00000717A (CC056GVv) pursuant to California Government Code Section 54956.9(A). There was nothing to report out due to ongoing litigation.

1. COMMENDATORY RESOLUTIONS/PRESENTATIONS

1.PRESENTATION – CONNECTING COMPTON (COUNCILPERSON

BOWERS) (PRESENTATION MADE)
Councilperson Bowers introduced Connecting Compton, an equestrian program started in 2019 designed to preserve the equestrian and agricultural lifestyle of the Richland Farms community in the City of Compton.

Hector Gomez, Connecting Compton, offered a PowerPoint Presentation to the City Council highlighting their achievements and proposal to develop a community center, recreation spaces, reclaimed landscape and equestrian facilities at the 18-acre former landfill located at 2800 West Alondra Boulevard.

2.PRESENTATION – CRESSEY PARK LEGENDS INC. (COUNCILPERSON

DUHART) (PRESENTATION MADE)
Councilperson Duhart introduced Cressey Park Legends Inc., a non-profit organization created to promote the game of baseball, fostering positive sport images, and making a lasting impact on the lives of the youth.

Joe Moore, Cressey Park Legends Inc. Hall of Fame Designer, offered a PowerPoint Presentation to the City Council highlighting Cressey Park’s history and their proposal to build a Hall of Fame monument, in recognition of the accomplishments made by African American baseball players.

3.PRESENTATION – CAYDEN SIMONE MATHEWS – WINNER OF

NATIONAL TENNIS AND LEARNING ESSAY CONTEST
(COUNCILPERSON DUHART) (PRESENTATION RESCHEDULED TO
10/10/23)

PUBLIC COMMENTS ON AGENDA ITEMS AND NON-AGENDA MATTERS
David Irons stated that Resolution Number 20,986 declared Compton Municipal Stadium a historical landmark. He also commented that he was the person responsible for registering the Compton California Richland Farms Historical Landmark Committee with the County of Los Angeles.

Benjamin Holifield requested the completion date for the Artesia Bridge project. He commended the organizations that offered project proposals and asked the Mayor and City Council to support them.

Tamoia Donlow, Business Owner at 1138 E. Rosecrans, petitioned the City Council to help her address the thefts and break-ins at her store.

Mayor Sharif referred Ms. Donlow to a staff member.

Marjorie Shipp asked the Mayor and City Council to consider the impact on the residents if the 18-acre former landfill is developed.

The following individuals expressed their support for Connecting Compton’s proposal to re- develop the 18-acre former landfill at 2800 West Alondra Boulevard: Yenifer Espitia, Johan Hernandez, Diana Alvarado, Joshua Gonzalez, Kamal Miller, Quron Peitiero, Kathleen Blackstone, Adrian Peree, Samuel Vasquez, and Becky Lopez Abril Villaneuva commended Councilperson Bowers for mentioning the need for translation services. She expressed her support for Connecting Compton’s proposal and urged the City Manager to allocate funding for the translation of the Compton City Charter.

Dawn Benton, Republic Services, announced that she is in the audience to address customer issues and complaints.

Travis Martin petitioned the City Manager to help her address the ongoing parking issues on Grandee Avenue.

Mayor Sharif asked the City Manager to contact Ms. Martin tomorrow.

Jacqueline Venters expressed a concern for toxic fumes emanating from 2800 West Alondra Boulevard if the land is disturbed. She also asked that the restrooms at Wilson Park remain open for the youth that play in the skate park.

Irene Taylor encouraged the residents to apply for a position on the Los Angeles County Civil Grand Jury. For more information contact City Hall.

Deshawn Watkins, Compton Mania, invited the residents to attend their “4th Annual Anniversary Show” scheduled to be held on Monday, October 29 in the City of Bell. The show will begin at 5:00pm.

Michael Tinkillen commented on the vast and complex history of Richland Farms and its influence from the native people.

Mr. Martin complained about the City’s media outlets and questioned why Compton does not have the monetary success that Inglewood has.

Tanya Lewis asked the City Manager to verify the price for early housing inspections.

Missy Barbara asked the City Manager to address the condition of the pocket park near Wilmington Boulevard and the Successor Agency property at 156 th Street and Central. She requested street improvements on Wilmington Boulevard and tree trimming in Richland Farms parks.

Lynn Boone announced that she would be running for City Clerk in 2024. She cited a lack of communication between the City Council and the citizens and affirmed that she is not afraid to do the job of the City Clerk.

Vanessa Cain expressed a concern for horses dying because of the contaminated land at 2800 West Alondra Boulevard.

Fidel Marquez voiced his support for the developments proposed by Connecting Compton and Cressy Park Legends Inc. He petitioned the City to make public safety, infrastructure and education a priority over building 1,000 more houses by the year 2045.

Mark Smith petitioned the City Manager to get feedback from the residents living in the area surrounding the landfill prior to making their final decision on 2800 West Alondra Boulevard.

REGULAR AGENDA

REPORTS OF OFFICERS, BOARDS, COMMISSIONS, AND COMMITTEES AND

CITY COUNCIL

4.APPOINTMENT(S) OF OFFICERS, BOARDS, COMMISSIONS AND
COMMITTEES AND CITY COUNCIL – BEAUTIFICATION COMMISSION (CMC SECTION 2-10) (COUNCILPERSON DUHART)
On motion by Duhart, seconded by Darden, to appoint Kesi Armstrong to the Beautification Committee by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

5.REMOVAL OF OFFICERS, BOARDS, COMMISSIONS AND COMMITTEES AND CITY COUNCIL – PUBLIC SAFETY COMMISSION
On motion by Duhart, seconded by Spicer, to remove Robert Ray from the Public Safety Commission by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

NEW BUSINESS

6. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

ADOPTING AND AUTHORIZING THE SUBMISSION OF THE HOUSING AND URBAN DEVELOPMENT (HUD) FISCAL YEAR 2021-2022 CONSOLIDATED

ANNUAL PERFORMANCE AND EVALUATION REPORT (CAPER) TO THE

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD)
On motion by Duhart, seconded by Spicer, Resolution Number 25,910 entitled “A

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON ADOPTING

AND AUTHORIZING THE SUBMISSION OF THE HOUSING AND URBAN DEVELOPMENT (HUD) FISCAL YEAR 2021-2022 CONSOLIDATED ANNUAL

PERFORMANCE AND EVALUATION REPORT (CAPER) TO THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD)” was adopted by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

7. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

APPROVING THE ATTACHED MEMORANDUM OF UNDERSTANDING

BETWEEN THE CITY OF COMPTON AND THE COMPTON COMMUNITY

COLLEGE DISTRICT FOR A JOINT COLLABORATION FOR A COMPTON FIRE

ACADEMY AT COMPTON COMMUNITY COLLEGE
On motion by Duhart, seconded by Spicer, Resolution Number 25,911 entitled “A

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON APPROVING

THE ATTACHED MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF

COMPTON AND THE COMPTON COMMUNITY COLLEGE DISTRICT FOR A JOINT

COLLABORATION FOR A COMPTON FIRE ACADEMY AT COMPTON
COMMUNITY COLLEGE” was adopted by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

8. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

AUTHORIZING THE CITY MANAGER TO ENTER INTO A TWO-YEAR

AGREEMENT WITH AND ESTABLISH A PURCHASE ORDER TO INFOSEND

FOR DATA PROCESSING, PRINTING AND MAILING SERVICES IN AN

AMOUNT NOT TO EXCEED ONE HUNDRED AND EIGHTY THOUSAND
DOLLARS ($180,000) DURING THE FIRST YEAR OF THE AGREEMENT (FY 2023-2024)
On motion by Darden, seconded by Duhart, Resolution Number 25,912 entitled “A

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

AUTHORIZING THE CITY MANAGER TO ENTER INTO A TWO-YEAR

AGREEMENT WITH AND ESTABLISH A PURCHASE ORDER TO INFOSEND FOR

DATA PROCESSING, PRINTING AND MAILING SERVICES IN AN AMOUNT NOT TO EXCEED ONE HUNDRED AND EIGHTY THOUSAND DOLLARS ($180,000) DURING THE FIRST YEAR OF THE AGREEMENT (FY 2023-2024)” was adopted by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

9. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

AUTHORIZING THE CITY MANAGER TO ENTER INTO A THREE-YEAR

AGREEMENT WITH AND ESTABLISH A PURCHASE ORDER TO BLUE

LOCKER FOR UNDERWATER TANK INSPECTION AND CLEANING

SERVICES IN THE AMOUNT OF FIFTY-FIVE THOUSAND SIX-HUNDRED AND FIFTY DOLLARS ($55,650.00)
On motion by Darden, seconded by Duhart, Resolution Number 25,913 entitled “A

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

AUTHORIZING THE CITY MANAGER TO ENTER INTO A THREE-YEAR

AGREEMENT WITH AND ESTABLISH A PURCHASE ORDER TO BLUE LOCKER

FOR UNDERWATER TANK INSPECTION AND CLEANING SERVICES IN THE

AMOUNT OF FIFTY-FIVE THOUSAND SIX-HUNDRED AND FIFTY DOLLARS ($55,650.00)” was adopted by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

COUNCIL COMMENTS
Councilmember Darden offered the following communications/announcements:
Recognized the month of October as National Domestic Violence Awareness Month, Breast Cancer Awareness Month and Disability Awareness Month Commented on the success of the Monthly Audit Committee meeting, East Rancho Neighborhood Watch Group Meeting, Retiree Luncheon, Community meeting at Saint Timothy’s Tower, Jazz on the Grass Concert and Afro-Latino Cultural-Festival Invited the seniors to participate in the “Arts & Crafts Workshop” scheduled to be held on Monday, October 23 at Dollarhide starting at 12 noon. Encouraged the residents to attend the “Fourth District Townhall” scheduled to be held on Saturday, October 28 at Kelly Park.

Councilmember Bowers offered the following communications/announcements:
Announced the availability of the City’s Emergency Preparedness pamphlet on all social media platforms.
Announced the “Third District Townhall” scheduled to be held on Saturday, October 14 from 10:00am to 12:00pm at Burrell McDonald Park. Staff will be on site to answer questions from the residents.
Announced the Homeless Resource/Referral Hotline at (951) 363-4921. Invited the residents to apply for the Pacific Asian Consortium Employment (PACE) “Household Water Assistance for Low-Income Families” program. For more information contact Alicia Thompson (310) 605-5612
Councilmember Spicer offered the following communications/announcements:
Commented on the success of the Baby Items Giveaway and Afro-Latino Cultural- Festival
Announced the “Free Housing Resource Fair” scheduled to be held on Wednesday, October 4 from 10:00am to 3:00pm. The event will provide resources for people living with HIV/AIDS or at-risk for being homeless.
Announced the Compton Initiative & Bright Lights of Compton “Community Clean- Up” scheduled to be held on Saturday, October 21. Participants will meet at 212 West Cypress Street at 9:00am.

Councilmember Duhart offered the following communications/announcements:
Commented on the success of the Afro-Latino Cultural-Festival Announced the “First District Townhall” scheduled to be held on Saturday, October 7 from 10:00am to 12:00pm at NHS located at 1051 Rosecrans Avenue Invited the women in the community to visit the mammogram clinic at NHS on Saturday, October 7.
Commended Connecting Compton and Cressy Park Legends Inc. for their presentations.
Reported that for the month of September 2023, the City of Compton received $85,691.26 from the Crystal Casino.
Requested the meeting be adjourned in memory of Senator Diane Feinstein Mayor Sharif offered the following communications/announcements:
Reported that the Artesia Bridge Project is scheduled to be completed by Spring 2024 Announced the opening of the HUD Community Development Block Grant Program.

For more information go to the City’s website at www.comptoncity.org Encouraged the youth to apply for the California Fire Fighter Joint Apprenticeship Committee. For more information call (424) 344-0961
Commented on the success of the Coffee with the Mayor: Senior Health Edition, Jazz on the Grass, Afro-Latino Cultural-Festival and the 60 th Reunion for the Centennial High School Class of 1963
Announced the “Halloween Festival” scheduled to be held on Friday, October 27 at Dollarhide starting at 5pm. For more information call (424) 344-0961

ADJOURNMENT
On motion by Spicer, seconded by Duhart, the meeting was adjourned in memory of Senator Diane Feinstein, David Arianas and Jerry Groomes Birthday at 8:29 p.m. by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None
___________________________________ ___________________________________

CITY CLERK OF THE CITY OF COMPTON MAYOR OF THE CITY OF COMPTON OCTOBER 10, 2023
The Compton City Council meeting was called to order at 5:35 p.m. by Mayor Emma Sharif in the Council Chambers of City Hall. The Moment of Silence Ceremony and the Pledge of Allegiance was also led by Mayor Emma Sharif.

ROLL CALL
Council Members Present: D. Duhart, A. Spicer, J. Bowers, L. Darden, Mayor E. Sharif Council Members Absent: None

Other Officials Present: E. Perrodin, V. McDaniel, B. Mims, J. Groomes

COMMENDATORY RESOLUTIONS/PRESENTATIONS

1. PRESENTATION – CAYDEN SIMONE MATTHEWS – WINNER OF USTA

NATIONAL JUNIOR TENNIS & LEARNING ESSAY CONTEST
(COUNCILPERSON DUHART) (PRESENTATION MADE)
Councilperson Duhart recognized Cayden Simone Matthews for her exceptional talent and determination to be named one of ten nation-wide winners of the USTA Foundation’s 24th Annual National Jr. Tennis & Learning Essay Contest.

2. ORAL PRESENTATION/POWERPOINT – H.O.S.T. – HOMELESS
OUTREACH SERVICE TEAM – SGT. COPPES (COUNCILPERSON

BOWERS) (PRESENTATION MADE)
Councilperson Bowers introduced H.O.S.T (Homeless Outreach Service Team), a Los Angeles County Sheriff’s team created to preserve public safety and combat homelessness.

Sergeant Coppes, H.O.S.T., offered a PowerPoint Presentation to the City Council highlighting their efforts to address the homeless crisis with compassion and dignity throughout the County of Los Angeles.

PUBLIC COMMENTS ON AGENDA ITEMS AND NON-AGENDA MATTERS
Tanya Lewis asked the City Manager to explain the $331.00 fee that was added to the residents’ property tax bills. She also requested a meeting with the City Council to discuss the proposed development on Parmalee Avenue.

Fidel Marquez asked the City Manager to clarify a year’s worth of fees for trash service on his property tax bill. He accused the Director of the Water Department of not telling the truth about the breakdown in fees and contended that people might lose their homes for lack of payment for trash service.

Lynn Boone suggested that the rules of decorum be updated. She declared Isaac Galvan the winner of the 2021 election and maintained that she would not allow herself to be controlled by other elected officials if she is elected City Clerk.

Albert De La Mora asked the City Manager if his plans for the City include the implementation of a camera surveillance system to help mitigate illegal dumping.

Vanessa Cain accused the Mayor and City Attorney of trying to censor audience comments.

Mayor Sharif informed Ms. Cain about the rules of decorum.

Rodney Lister petitioned the City Council to clarify the information shared with the residents regarding the trash fees on their property tax bill.

Mohammed Mubarak acknowledged the passing of his mentor, Philip McAllister and asked for an opportunity to renovate one of their murals in his memory.

2. Ben Eilenberg, COO of Compton Property Group, petitioned the City Attorney to schedule a closed session to discuss a legal matter involving the Compton Property Group and the City of Compton.

Jacqueline Ventures inquired about the completion of any projects since 2014. She made comments about public safety, street repairs and homelessness. She asked the City Council if they cared about the residents’ concerns and stated that she believes the community is under-served for the amount of money they pay in property taxes.

Joyce Kelly accused the City Council of using legal codes to censor the people. She claimed the people are telling the truth and using the Brown Act to have more say in their government. She expressed her support for Councilperson Bowers and declared that the people want their City back.

Floyd Smith petitioned the City Council to address the condition of the City’s streets, sewer and water infrastructure. He also asked the City Council to address how Republic managed to get on the residents’ property tax bill without a vote from homeowners.

Missy Barbara asked the Director of the Water Department to address the fees on her property tax bill. She commented that during a conversation with Mr. Meza, he agreed that the residents would only pay for four months of trash service. She maintained that it is unfair for the residents to be held accountable for someone else’s actions.

City Attorney Perrodin reported that on May 20, 2022, Los Angeles Superior Court Judge Michelle Williams ruled that candidate Andre Spicer was the actual winner in the City of Compton District 2 race by a voted total of 854 to 851 - after she found that four illegal votes were cast for Isaac Galvan.

REGULAR AGENDA

REPORTS OF OFFICERS, BOARDS, COMMISSIONS, AND COMMITTEES AND

CITY COUNCIL

3.APPOINTMENT(S) OF OFFICERS, BOARDS, COMMISSIONS AND
COMMITTEES AND CITY COUNCIL – FEDERAL GRANTS ADVISORY
BOARD (CMC SECTION 2-14) (COUNCILPERSON SPICER)
On motion by Duhart, seconded by Sharif, to appoint Dr. Adrienne Thomas to the Federal Grants Advisory Board by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None
CITY MANAGER’S REPORT

4.REQUEST FOR WORKSHOP – SUMMARY OF ACTIVITIES ON CITY-

OWNED PROPERTY
On motion by Spicer, seconded by Duhart, to schedule the workshop on November 7, 2023 at 3:00 p.m. by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

NEW BUSINESS

5. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

AUTHORIZING THE CITY MANAGER TO ISSUE A PURCHASE ORDER TO WAXIE ENTERPRISES, INC. DBA WAXIE SANITARY SUPPLY FOR THE

PROCUREMENT OF EQUIPMENT AND SUPPLIES ON AN AS-NEEDED BASIS FOR THE GENERAL SERVICES DEPARTMENT ($50,000.00)
On motion by Darden, seconded by Spicer, Resolution Number 25,914 entitled “A

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

AUTHORIZING THE CITY MANAGER TO ISSUE A PURCHASE ORDER TO WAXIE ENTERPRISES, INC. DBA WAXIE SANITARY SUPPLY FOR THE PROCUREMENT

OF EQUIPMENT AND SUPPLIES ON AN AS-NEEDED BASIS FOR THE GENERAL SERVICES DEPARTMENT ($50,000.00)” was adopted by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

COUNCIL COMMENTS
Councilmember Duhart offered the following communications/announcements:
Commented on the success of the First District Townhall meeting. Announced the “Key of Knowledge - After School Program” starting Tuesday, October 17 at Gonzales Park. Youths ages 7-14 are welcome on Tuesdays, Wednesdays and Thursdays from 3:00pm to 6:00pm. Snacks will be provided. Announced that in recognition of Breast Cancer Awareness Month, NHS will be offering free mammograms to anyone requesting a screening. For more information call (424) 296-3521.
Commended the Public Works Department for removing the fallen tree on 132 nd Street over the weekend.

Councilmember Spicer offered the following communications/announcements:
Commented on the success of the Free Housing Resource Fair. Announced the “Second District Baby Supplies Giveaway” scheduled to be held on Wednesday, October 25 beginning at 11:00am. The event will offer diapers, toys, clothing and ultrasounds.
Announced the Compton Initiative & Bright Lights of Compton “Community Clean- Up” scheduled to be held on Saturday, October 21. Participants will meet at 212 West Cypress Avenue at 9:00am.
Requested an update from the City Manager regarding the fees on the residents’ property tax bill.

Councilmember Bowers offered the following communications/announcements:
Announced the “Third District Townhall” meeting scheduled to be held on Saturday, October 14 at Burrell McDonald Park from 10:00am to 12:00pm. PACE and employment staff will be on site for application assistance. For more information call (310) 605-5612.
Announced the “20th Annual Compton High School Alumni Picnic” scheduled to be held on Saturday, October 14 at Hemmingway Park from 10:00am to 5:00pm. Invited the residents to apply for the Pacific Asian Consortium Employment (PACE) “Household Water Assistance for Low-Income Families Program.” For more information contact Alicia Thompson at (310) 605-5612.
Recognized Breast Cancer Awareness Month in memory of every cancer patient, family and friend affected by breast cancer.

Councilmember Darden offered the following communications/announcements:
Commented on the success of the Farmer’s Market held at the Center for Sustainable Communities, First District Townhall meeting, and the Letter Carriers Enough is Enough Rally at the Santa Fe Avenue Post Office.
Invited the seniors to attend the “Annual Hoe-Down Dance” scheduled to be held on Thursday, November 16 at Dollarhide.
Invited the community to attend the “Financial Health Workshop” scheduled to be held on Wednesday, October 11 at Dollarhide starting at 12 noon. Invited the youth to participate in the “Girls Empowerment Program” scheduled to be held on Saturday, October 14. Topics of discussion include mindset development, confidence building, leadership skills, introduction to business and entrepreneurship.

Details can be found on the City’s website www.comptoncity.org. Invited the seniors to attend the “Arts & Crafts Workshop” scheduled to be held on Monday, October 23 at Dollarhide starting at 12 noon.
Announced the “Compton Entertainment Chamber of Commerce Business Mixer” scheduled to be held on Thursday, October 26 at Crystal Crab House. Encouraged the residents to attend the “Fourth District Townhall” meeting scheduled to be held on Saturday, October 28 at Kelly Park.
Announced the funeral services for Amos Clay scheduled to be held on Thursday, October 12 at Citizens of Zion Missionary Baptist Church beginning at 11:00am.

Mayor Sharif offered the following communications/announcements:
Announced the RFP opening for the HUD Community Development Block Grant Program. For more information visit the City’s website at www.comptoncity.org. Encouraged the youth to apply for a position on the California Fire Fighter Joint Apprenticeship Committee. For more information call (424) 344-0961. Commented on the success of the Building Leaders & Uplifting Sisterhood Conference held at California State University Dominguez Hills.
Invited the residents to attend the “Resource Fair” scheduled to be held on Saturday, October 14 at Compton Youth Build from 11:00am to 3:00pm. Announced the “Halloween Festival” scheduled to be held on Friday, October 27 at Dollarhide starting at 5pm. For more information call (424) 344-0961. Requested the meeting be adjourned in memory of Sergeant Emilio Guerro.

ADJOURNMENT
On motion by Duhart, seconded by Spicer, the meeting was adjourned in memory of Sergeant Emilio Guerro at 7:16 p.m. by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None
___________________________________ ___________________________________

CITY CLERK OF THE CITY OF COMPTON MAYOR OF THE CITY OF COMPTON APRIL 23, 2024
The Compton City Council meeting was called to order at 4:30 p.m. by Mayor Emma Sharif in the Council Chambers of City Hall. The Moment of Silence Ceremony and the Pledge of Allegiance was also led by Mayor Sharif.

ROLL CALL
Council Members Present: D. Duhart, A. Spicer, L. Darden, J. Bowers, Mayor E. Sharif

Other Officials Present: E. Perrodin, V. McDaniel, Willie A. Hopkins

CLOSED SESSION AGENDA ITEMS

PENDING LITIGATION
Title: Jerry Leggett v. City of Compton - Case No. STCV 40919 Pursuant to California Government Code Section 54956.9(a)

PUBLIC EMPLOYEE PERFORMANCE EVALUATION
Title: City Controller
Pursuant to California Government Code Section 54957

AUDIENCE COMMENTS REGARDING CLOSED-SESSION AGENDA ITEMS ONLY Rodney Lister, expressed his concerns about the City Controller’s office not returning his phone calls and emails.

On motion by Duhart, seconded by Bowers, to approve the closed session by the following vote on roll call:

AYES: Council Members – Duhart, Bowers, Sharif NOES: Council Members – None
ABSENT: Council Members – Spicer, Darden
On motion by Duhart, seconded by Bowers, to recess the meeting from the closed session at 4:34 p.m. by the following vote on roll call:

AYES: Council Members – Duhart, Bowers, Sharif NOES: Council Members – None
ABSENT: Council Members – Spicer, Darden
On motion by Duhart, seconded by Darden, the City Council meeting reconvened at 5:55 p.m. by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

REPORT ON CLOSED SESSION ACTION(S)

City Attorney Perrodin reported out that City Council met in closed session regarding pending litigation - Settlement in progress Re: Jerry Leggett v. City of Compton – Case No. STCV 40919. There was nothing to report at this time.

COMMENDATORY RESOLUTIONS/PRESENTATIONS

1. POWERPOINT PRESENTATION – THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA (MWD) ADEL HAGEKHALIL P.E., BCEE CHIEF

EXECUTIVE GENERAL MANAGER AND ADAN ORTEGA, BOARD CHAIR, (MAYOR EMMA SHARIF) (PRESENTATION MADE)

3. Adan Ortega, Board Chair of the Metropolitan Water District, spoke about water quality in the underground wells, PFAS, and the dependence on imported water from the Colorado River and Northern California. He also spoke about the speed to cleanup the underground wells and restore access to underground drinking water. He also spoke about converting the City's disinfection system from chlorine to chloramines, and of the 3.4-acre-feet of water we have in storage right now, about 2.4 million-acre feet are there because of reduced demand through water conservation efforts.

Deven Upadhyay, Executive Officer of the Metropolitan Water District, spoke about rebates for high-efficiency toilets or high-efficiency clothes washers, being aware of water quality issues as a threat, and the commitment to address these water quality issues going forward. He also spoke about developing Metropolitan supplies sourced here locally in Southern California through a partnership with the Los Angeles County sanitation district to produce a new local supply that the Metropolitan could develop known as the pure water Southern California program. He also spoke about implementing pump back systems that will allow Colorado River water, stored surface water, from our Diamond Valley Lake

PUBLIC COMMENTS ON AGENDA ITEMS AND NON-AGENDA MATTERS
Irene Taylor, spoke about the need for cleaning up Compton Creek and the possibility of diseases that may result from its lack of maintenance and offered to participate in the cleanup efforts.

Mark Smith, voiced concerns about water quality, the presence of carcinogens in the water, and Republic Services' neglect to pick up refuse in a timely manner.

Lynn Boone, voiced concerns about the posting of Council Meeting Minutes, the removal of commissioners, and the requirement that those appointed to office be residents of Compton.

Richard Earl, a Compton resident and president of Concerned Citizens, expressed gratitude for the audit and concern about the need for the Compton Creek cleanup. He also expressed a need for AEDs in case of an emergency. There was also concern about prostitution on Long Beach Boulevard and efforts to stop it.

Kinsey Jones stated concerns about prostitution on Long Beach Boulevard and street maintenance.

Maria Villareal, president of the Latino Chamber of Commerce stated The Chamber is signing volunteers for four hours per day, Monday through Friday, with the consent and the approval of their parents. She also spoke about violating the rules of conduct during council meetings and how the rules are defined and should be respected.

Marjorie Shipp, voiced concerns about Long Beach Boulevard prostitution and the cleanup of Compton Creek, as well as the Compton Initiative Cleanup and Painting, which was done, and over 100 people attended the efforts.

Vanessa Cain, made a comment about the prostitution on Long Beach Boulevard and how the individuals involved could possibly be arrested for lewd conduct as well as concerns about the Compton Creek cleanup and street vendors leaving trash as well as the dumping of oil in the sewer system.

Fidel Marquez, commented that the audit update was very informative. He also expressed concern about brown water coming from the faucet in his home. He suggested the council look into partnering with MWD for a Smart Water Monitor Detector device, which detects water leaks in the home. He suggested that the council look into a lawsuit derived from a class action lawsuit in Lancaster concerning the Sheriff’s Department. He also suggested that the city consider placing cameras in the city.

Rodney Lister voiced a desire for citizens and city officials to partner to aid the city in operational efficiency. He also expressed concern about the Compton Creek cleanup efforts, graffiti, and time constraints on different agenda items. He also expressed a need to speak with City Council Members individually about his concerns.

Tanya Lewis, voiced concerns about the Compton Creek cleanup efforts and possible treatment of mosquitos in the area as well as graffiti in the city. She also mentioned the need for help with the prostitution along Long Beach Boulevard.

Miller Martin, voiced concern about placing a stop sign at the intersection of Stockwell and Grandee, the Compton Creek cleanup efforts, and the overall image of the City of Compton are viewed positively.

CONSENT AGENDA
On motion by Spicer, seconded by Duhart, the Consent Agenda was approved by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

APPROVAL OF MINUTES

2. July 18, 2023

3. July 31, 2023

REGULAR AGENDA

REPORTS OF OFFICERS, BOARDS, COMMISSIONS AND COMMITTEES AND CITY

COUNCIL

4.REMOVAL OF OFFICERS, COUNCIL MEMBERS, BOARDS/COMMISSIONS AND COMMITTEES – PERSONNEL BOARD
On motion by Duhart, seconded by Spicer, to remove Jennifer Grant from the Personnel Board by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None
On motion by Spicer, seconded by Sharif, to remove Yewande Ayodele from the Personnel Board was withdrawn by Spicer.

5.APPOINTMENT(S) OF OFFICERS, COUNCIL MEMBERS

BOARDS/COMMISSIONS AND COMMITTEES PERSONNEL BOARD
On motion by Spicer, seconded by Duhart, to appoint Alysia Rivers to the Personnel Board was withdrawn by Spicer.

On motion by Spicer, seconded by Darden, the removal of Jennifer Grant from the Personnel Board was withdrawn by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None
CITY MANAGER’S REPORT

6.A REQUEST TO SCHEDULE PUBLIC HEARING TO ADOPT THE ENGINEER’S

REPORTS FOR THE COMPTON LIGHTING AND LANDSCAPE ASSESSMENT DISTRICT NO.1 AND THE SEWER SERVICE CHARGES FOR FISCAL YEAR 2024-2025
On motion by Darden, seconded by Spicer, to schedule the public hearing to adopt the engineer’s reports for the Compton Lighting and Landscape Assessment District No.1 and the Sewer Service Charges for Fiscal Year 2024-2025 on May 24, 2024, at 5:35 p.m. by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

7.REQUEST TO SCHEDULE A PUBLIC HEARING, BUDGET WORKSHOP, AND

COMMUNITY MEETING FOR THE CONSIDERATION OF THE PROPOSED FISCAL YEAR 2024-25 BUDGET
On motion by Duhart, seconded by Darden, to schedule the public hearing on June 11, 2024, at 5:45 p.m., the budget workshop on June 1, 2024, at 10:00 a.m., and the community meeting on June 4, 2024, at 4:30 p.m. by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

NEW BUSINESS

8. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

AUTHORIZING THE CITY MANAGER TO ACCEPT THE PROPOSAL SUBMITTED BY MARIPOSA ECO CONSULTING INC. FOR PROVIDING CONSULTING SERVICES TO COMPLY WITH SB 1383 REGULATIONS, IMPLEMENTATION AND RECORDKEEPING, TO ENTER INTO A TWO (2) YEAR PROFESSIONAL

SERVICES AGREEMENT AND TO ESTABLISH A PURCHASE ORDER IN THE AMOUNT OF EIGHTY THOUSAND DOLLARS ($80,000) FOR FISCAL YEARS 2023-2024 AND 2024-2025.

Councilperson Darden asked about the education for our residents on SB1383 and will they get the data from our rubbish company, Republic, in order to enter it into the database?

City Manager Hopkins responded that there's been a series of information that's been shared with the community, over the last few years, concerning this Senate bill and there will continue to be a tremendous amount of information provided to the citizens to make sure we stay in compliance, and that will require some coordination with our waste provider, Republic.

On motion by Darden, seconded by Duhart, Resolution No. 26,019 entitled ‘A RESOLUTION

OF THE CITY COUNCIL OF THE CITY OF COMPTON AUTHORIZING THE CITY

MANAGER TO ACCEPT THE PROPOSAL SUBMITTED BY MARIPOSA ECO CONSULTING INC. FOR PROVIDING CONSULTING SERVICES TO COMPLY WITH SB 1383 REGULATIONS, IMPLEMENTATION AND RECORDKEEPING, TO ENTER INTO A TWO (2) YEAR PROFESSIONAL SERVICES AGREEMENT AND TO

ESTABLISH A PURCHASE ORDER IN THE AMOUNT OF EIGHTY THOUSAND DOLLARS ($80,000) FOR FISCAL YEARS 2023-2024 AND 2024-2025’ was adopted by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

9. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

DECLARING THE RESULTS OF THE PRIMARY NOMINATING ELECTION HELD IN SAID CITY ON MARCH 5, 2024
Madam City Clerk requested permission to give a little bit of background. Approval of this resolution will be reciting the facts and declaring the results of the primary nominating election held on March 5, 2024. Pursuant to Compton City Charter Article 13, the primary nominating and special election was held on Tuesday, March 5, 2024. City Resolution No. 25918 mandated that the city's election be consolidated with the Los Angeles register recorder county clerk. In the election, 8,357 -- which was 17 percent of Compton eligible voters -- cast their vote across seven vote centers and three vote-by-mail ballot boxes. Pursuant to Election Code Section 10262, for consolidated election, the city election's official, upon receipt of the certified results of the election, from the Los Angeles Register Recorder County Clerk, shall certify the results no later than the next regularly scheduled city council meeting following presentation of the 28-day canvas of the returns or at a special meeting called for this purpose, complied with the applicable provisions of Section 10263. The Los Angeles Register Recorder County Clerk's Office Certificate of Election and Statement of Votes can be found in the exhibit that are attached to the resolution. Finally, in accordance with City Resolution No. 2598, the following names will advance to the general Municipal Election to be held on November 5, 2024, District 1, Deidre Duhart, Jasper Jackson.

District 4, Lillie P. Darden, Joel Estrada. City clerk, Vernell McDaniel, Satra Zurita. Since the city attorney contents was unopposed, Eric Perrodin, as the sole candidate, will not be listed on the November 5, 2024 election ballot. Once said resolution is approved, the city clerk will present Eric Perrodin with a certificate of election.

On motion by Duhart, seconded by Spicer, Resolution No. 26,020 entitled ‘A RESOLUTION

OF THE CITY COUNCIL OF THE CITY OF COMPTON DECLARING THE RESULTS OF THE PRIMARY NOMINATING ELECTION HELD IN SAID CITY ON MARCH 5, 2024’ was adopted by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

10. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

INITIATING PROCEEDINGS FOR THE LEVY AND COLLECTION OF

ASSESSMENTS WITHIN THE COMPTON LIGHTING AND LANDSCAPE
DISTRICT NO. 1 FOR FISCAL YEAR 2024-2025 AND ORDERING THE PREPARATION OF AN ENGINEER’S REPORT PURSUANT TO THE PROVISIONS OF PART 2 OF DIVISION 15 OF THE CALIFORNIA STREETS AND HIGHWAY CODE
Councilperson Bowers inquired into the usage of the estimated collection of $4 million because it didn’t appear to have any money been invested into lighting and landscaping.

City Manager Hopkins stated that there was a proposed budget in there, and of the $4.1 million that's collected, roughly 600,000 goes to salaries and benefits or a little over 700,000 for salary and benefits, another $75,000 goes to equipment. Street sweeping was about $700,000, tree trimming for about $400,000. Median maintenance is only 31,000. Another $350,000 for traffic signals and lighting, and utilities, which is about $1.7 million.

The actual direct cost of the 4.1 is about $3.9 million that's utilized to provide the aforementioned services. There’s a minimal amount of administrative cost, which is about $21,000. And, then, you have an operational reserve, which gives you the net estimate of $4.2 million is how those funds are allocated and spent.

That's the proposed budget, based on the collections, but they will come back in May and bring back the engineer's report for the public hearing.

Councilperson Darden inquired whether the agenda packet was null and void.

John Strickland, Public Works Director addressed the concern stating the item is to initiate the proceedings for the lighting and landscaping assessment, and that it was a preliminary engineering report proposed for 2024/2025. He advised there will be opportunity for input at the public hearing, on May 21st.

Mayor Sharif asked if this has anything to do with the LED lighting that was supposed to have been upgraded by SCE and are these funds going to be used in that manner, or can those funds be used in that manner to finish upgrading the lights that the city is supposed to be responsible for.

Mr. Strickland indicated that is an eligible activity. However, the funds are currently being used, as stated in the budget, for street sweeping and tree trimming as well as we are paying the

1.5 million to Edison for the electricity of the current lights. He also stated that if we wanted to switch the lights out it would cost the city.

Councilperson Duhart inquired about Edison driving through the city at night looking for lightbulbs that are out.

Mr. Strickland replied that Edison does assess the lighting system that are owned by Edison, and They were replacing the lights, as we speak. They started last year. They're replacing all of their lights with LED, and they pull permits, through the public works engineering department.

So they are replacing their lights with the new LED.

On motion by Darden, seconded by Duhart, Resolution No. 26,021 entitled ‘A RESOLUTION

OF THE CITY COUNCIL OF THE CITY OF COMPTON INITIATING PROCEEDINGS

FOR THE LEVY AND COLLECTION OF ASSESSMENTS WITHIN THE COMPTON LIGHTING AND LANDSCAPE DISTRICT NO. 1 FOR FISCAL YEAR 2024-2025 AND ORDERING THE PREPARATION OF AN ENGINEER’S REPORT PURSUANT TO THE PROVISIONS OF PART 2 OF DIVISION 15 OF THE CALIFORNIA STREETS AND HIGHWAY CODE’ was adopted by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

11. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

INITIATING PROCEEDINGS FOR THE LEVY AND COLLECTION OF

ASSESSMENTS WITHIN THE COMPTON SEWER SERVICE CHARGES FOR FISCAL YEAR 2024-2025 AND ORDERING THE PREPARATION OF AN ENGINEER’S REPORT PURSUANT TO THE MUNICIPAL IMPROVEMENT ACT OF 1913, DIVISION 12 OF THE CALIFORNIA STREETS AND HIGHWAYS CODE On motion by Darden, seconded by Spicer, Resolution No. 26,022 entitled ‘A RESOLUTION

OF THE CITY COUNCIL OF THE CITY OF COMPTON INITIATING PROCEEDINGS

FOR THE LEVY AND COLLECTION OF ASSESSMENTS WITHIN THE COMPTON SEWER SERVICE CHARGES FOR FISCAL YEAR 2024-2025 AND ORDERING THE PREPARATION OF AN ENGINEER’S REPORT PURSUANT TO THE MUNICIPAL IMPROVEMENT ACT OF 1913, DIVISION 12 OF THE CALIFORNIA STREETS AND HIGHWAYS CODE’ was adopted by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

12. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

ACCEPTING THE BID OF AND AUTHORIZING THE CITY MANAGER TO ENTER

INTO A LWAK REPAIR CONTRACT WITH COUNTY LEAK SERVICES AND

ESTABLISH A PURCHASE ORDER FOR ONE HUNDRED AND ONE THOUSAND FIVE HUNDRED DOLLARS ($101,500) FOR REPAIRS NEEDED AT THE CITY

POOL AT LUDERS PARK
Councilperson Darden stated that this pool was built in 1972. It is, now, 52 years old, and we need to see if we can get some grant funds or Measure P funds to do a new swimming pool. Last year the heater was not working, and that cost substantial amount of money to get that repaired. $8,500 has been spent for leak detection.

City Manager Hopkins responded that he understood, and this is something that needed additional discussion when we, do the workshop to talk about the reallocation of some funding.

It could be eligible for a capital improvement for the pool and some major modifications to Lueders Park.

On motion by Spicer, seconded by Duhart, Resolution No. 26,023 entitled ‘A RESOLUTION

OF THE CITY COUNCIL OF THE CITY OF COMPTON ACCEPTING THE BID OF

AND AUTHORIZING THE CITY MANAGER TO ENTER INTO A LWAK REPAIR

CONTRACT WITH COUNTY LEAK SERVICES AND ESTABLISH A PURCHASE

ORDER FOR ONE HUNDRED AND ONE THOUSAND FIVE HUNDRED DOLLARS ($101,500) FOR REPAIRS NEEDED AT THE CITY’ was adopted by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None
City Attorney Perrodin interjected and stated that upon further inquiry by the council, it was determined that the Council could not rescind their vote on removing Jennifer Grant from the personnel board. Ms. Grant has to be voted back on the board.

Council Member Spicer, upon this knowledge, decided to move forward with his appointment.

Mayor Sharif asked the council if they would re-visit Removal/ Appointments of Boards, Commissions, and Committees.

13. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

AUTHORIZING THE CITY MANAGER TO AMEND THE CURRENT AGREEMENT

WITH CINTAS CORPORATION TO ADD ADDITIONAL FUNDS FOR THE

PURPOSE OF PROVIDING UNIFORM RENTAL, LAUNDRY SERVICES AND PERSONAL PROTECTIVE EQUIPMENT (PPE) FOR FISCAL YEAR 2024-2025 IN THE AMOUNT OF FIFTY THOUSAND DOLLARS ($50,000)
Council Member Darden indicated that there was an increase from 21 employees to 28.

City Manager Hopkins answered Council Member Darden's question that six or seven additional employees were added to the water department in anticipation of the organization's growth. The aforementioned, coupled with uniforms, complies with some OSHA requirements regarding PPE.

On motion by Duhart, seconded by Spicer, Resolution No. 26,024 entitled ‘A RESOLUTION

OF THE CITY COUNCIL OF THE CITY OF COMPTON AUTHORIZING THE CITY

MANAGER TO AMEND THE CURRENT AGREEMENT WITH CINTAS

CORPORATION TO ADD ADDITIONAL FUNDS FOR THE PURPOSE OF PROVIDING

UNIFORM RENTAL, LAUNDRY SERVICES AND PERSONAL PROTECTIVE EQUIPMENT (PPE) FOR FISCAL YEAR 2024-2025 IN THE AMOUNT OF FIFTY THOUSAND DOLLARS ($50,000)’ was adopted by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None
Madam Clerk announced that The City of Compton will be celebrating its 136th birthday. There will be a reception in the council chambers at 205 South Willowbrook Avenue, Compton, on Tuesday, May 7th, from 3:00 p.m. to 4:30 p.m., with light refreshments.

Mayor Sharif wanted to revisit Item No. 4 to removals and appointments for boards, commissions, and committees
Madam Clerk indicated there needs to be a motion to reappoint Jennifer Grant -- a motion and a second.

Councilperson Spicer asked if we were at reappointment or are we at the removals?

Councilperson Darden stated she's already been removed, and she wanted to make a motion to reappoint Jennifer Grant.

Madam Clerk said That would be Item No. 5.

Councilperson Spicer asked If we're all ready to make our appointments tonight, can we just make the third removal and just appoint and just be done with this personnel board appointment? Mayor Sharif indicated that's exactly what was happening.

Councilperson Darden expressed displeasure with the process.

Councilperson Bowers also expressed displeasure with the process.

Mayor Sharif indicated there was some consistency and that those involved needed to remove someone to make an appointment.

Councilperson Bowers commented that Mr. Spicer’s appointment of Ms. Rivers would be a conflict because of her previous run for office, and the election was not over.

Councilperson Spicer indicated that it had nothing to do with an appointment to the personnel board.

Madam Clerk said there was a motion to remove Jennifer Grant. In order to place Jennifer Grant back on the personnel board, there has to be a motion to reappoint her to the personnel board.

Councilperson Darden said that she would like to reappoint Ms. Jennifer Grant to the personnel board for the City of Compton.

On motion by Darden, seconded by Spicer, to re-appoint Jennifer Grant to the Personnel Board by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None
On motion by Bowers, seconded by Duhart to appoint Termikerlyn Black to the Personnel Board by the following vote on roll call:

AYES: Council Members – Duhart, Bowers, Darden, Sharif
NOES: Council Members – Spicer
ABSENT: Council Members – None

On motion by Spicer, seconded by Duhart, to remove Yewande Ayodele by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Darden, Sharif
NOES: Council Members – None
ABSTAIN: Council Members – Bowers

On motion by Spicer, seconded by Duhart, to appoint Alysia Rivers to the Personnel Board by the following vote on roll call:

AYES: Council Members – Duhart, Spicer
NOES: Council Members – Bowers
ABSTAIN: Council Members – Darden, Sharif

COUNCIL COMMENTS
Councilmember Duhart offered the following communications/announcements:
Saturday, May 4th, Council Member Duhart will host my town hall meeting at Neighborhood Housing Services at 1051 West Rosecrans Avenue. On Friday, May 10th, there will be a Mother's Day brunch with Councilwoman Darden.

Everyone is welcome. There will be dancing and live entertainment. To register, please contact my liaison at [email protected] or call 310-761-1482.

Councilmember Spicer offered the following communications/announcements:
Every 4 th Wednesday of the month, he will be hosting our game-changer events at the Dollarhide Community Center between the hours of 4:30 and 8:00 p.m. On May 8th, there will be a Mother's Day luncheon in conjunction with the Honorably Michelle Chambers and Faith Inspirational Church between 1:00 p.m. and 4:00 p.m. at the Dollarhide Community Center.
Quick update on the potholes that will be filled in this week: Pearl Avenue between Alondra to Greenleaf, Mayo to Alondra to Greenleaf. California Avenue, Alondra to Greenleaf. Burris Avenue, Alondra to Greenleaf. Bennet from Temple to Long Beach Boulevard.

Councilmember Bowers offered the following communications/announcements:

The influx of mosquitos is possibly due to the recent rain and/or standing water. I also noted that mosquito abatement does a pretty good job of controlling mosquitos in the Compton area. If there’s a problem, call them.
The Compton alumni chapter of Delta Sigma Beta Sorority Incorporated, their third annual Jazz on the Grass Community Concert. Tickets will go on sale Sunday, April 28th. Those interested in attending September's event will have the ability to pick their seats and pay in advance, in person, at the Crystal Park Casino Hotel from 1:00 to 3:00 p.m.

For further event details, e-mail [email protected]. The Genesis Enterprise Project 2024, Compton to Washington, D.C. Historical tour has been postponed until the tentative date of June 2025 due to unforeseen circumstances.

Councilmember Darden offered the following communications/announcements:

The Los Angeles County's Board of Supervisors is expected to discuss a proposed budget at its meeting Tuesday. Public hearing on the budget are set to begin on May 15, with final changes to the budget set for June 24.
Mentioned she routinely circulate District 4 identifying code violation and situations requiring city attention.
The first quarter report of 2024 had reported one fire hydrant, 75 graffiti, health and safety hazards four, landscaping and maintenance 28, litter 71. Other code violations, quality of life 23, other issues one, potholes seven, sidewalk repair 3, Traffic Street signs two, tree pruning one, for a total of 216 work orders was done by District 4. She also observed new street sweeping signs were being installed in the 4th District. Recited that the city manager, we had mentioned about forming an Olympic committee. Advised that on Saturday, April 27th, Kaboom and Delta Airlines will be working on finalizing and installing new playground equipment at Kelly Park and that from 9:00 a.m. to 4:00 p.m.
Cinco de Mayo events will be held on Saturday, May 4th, at parks here in the city.

Mayor Sharif offered the following communications/announcements:
She has two incredible opportunities for students. The California Legislative Black Caucus Policy Institute is announcing it’s now open for African-American leaders for tomorrow program as well as the annual Frederick M. Roberts College Scholarship. The scholarship application deadline is Friday, May 10, 2024; for information on how to apply to both of these opportunities, contact Mayor Sharif’s liaison (424) 344-0961. Mayor Sharif announced the return of the citywide block club meeting at Dollarhide Community Center. The meeting will allow block clubs throughout the city of Compton to gather and address issues citywide.
If information is needed regarding the upcoming Cinco de Mayo event, please go on the city Website, and that information is there.

ADJOURNMENT
On motion by Spicer, seconded by Darden, the meeting was adjourned in memory of Maline Kathlene Geuidry, Dr. Joseph Lewis, Mitchell R. Weinbaum, Paul Van Gogh, and Joseph Baker at 8:21 p.m. by the following vote on roll call:

AYES: Council Members – Duhart, Spicer, Bowers, Darden, Sharif NOES: Council Members – None
ABSENT: Council Members – None

________________________________________ ___________________________________

CITY CLERK OF THE CITY OF COMPTON MAYOR OF THE CITY OF

COMPTON

4.4.4. May 28th, 2024
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
FROM: BRYAN SPRAGG, DIRECTOR OF RECREATION
SUBJECT: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

AUTHORIZING THE CITY MANAGER TO OPEN A PURCHASE ORDER

WITH STAPLES ADVANTAGE TO PAY INVOICES FOR OFFICE
SUPPLIES FROM FISCAL YEAR 2023-2024 IN THE AMOUNT OF
$1075.61

SUMMARY
Adoption of the attached resolution will establish a Purchase Order to pay unpaid office supplies invoices from the fiscal year 2023-2024.

BACKGROUND
The City of Compton’s residents, community centers, golf course, and swimming pools are supported by the administrative operations completed by the Recreation Department staff. The Recreation Department staff utilizes Staples Advantage to procure the supplies needed to maintain City operations. The City of Compton must utilize Staples Advantage to secure administrative supplies needed and to ensure operations continue.

STATEMENT OF THE ISSUE
City Council approval is needed to secure funding for office supplies purchased during the 2023-2024 Fiscal Year. Funds in the Staples Advantage account have been exhausted by the City at this time. Also, the City Manager has exceeded the $25,000 spending authority for the Staples Advantage account and City Council approval is needed. Previous invoices from the fiscal year have not been paid and the Department of Recreation is requesting to secure funding to pay past due invoices for a total amount of $1075.61.

SCOPE OF WORK
The City of Compton’s Recreation Department is requesting Staples Advantage provide the necessary office supplies needed to continue operations and support of the Recreation Department.

Staff Report – Payment -Staples Advantage
April 2, 2024, Page 2

FISCAL IMPACT
The total cost for fiscal year 2023-2024 is $1075.61. The funds for these expenditures are available in the Recreation Department’s 2023-2024 fiscal year budget and will be available in Account Number 1001-840-000-4244.

RECOMMENDATION
Staff recommends the City Council adopt the attached Resolution establishing and authorizing the City Manager to open a Purchase Order to pay past due invoices from Staples Advantage.

WILLIE A HOPKINS JR.

CITY MANAGER

RESOLUTION NO. _______________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COMPTON

AUTHORIZING THE CITY MANAGER TO OPEN A PURCHASE ORDER

WITH STAPLES ADVANTAGE TO PAY INVOICES FOR OFFICE
SUPPLIES FROM FISCAL YEAR 2023-2024 IN THE AMOUNT OF
$1075.61
WHEREAS, the City of Compton’s residents, community centers, golf course, and swimming pools are supported by the administrative operations completed by the Recreation Department staff; and
WHEREAS, the Recreation Department staff utilizes Staples Advantage to procure the supplies needed to maintain City operations; and WHEREAS, funds in the Staples Advantage account have been exhausted by the City at this time. Also, the City Manager has exceeded the $25,000 spending authority for the Staples Advantage account and City Council approval is needed.; and WHEREAS, invoices from Fiscal Year 2023-2024 have recently been received and remain unpaid; and
WHEREAS, payment is needed on the outstanding invoices totaling $1075.61.

Funds are available in Account Number 1001-840-000-4244 for the outstanding invoices from Staples Advantage.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF COMPTON DOES HEREBY RESOLVE AS FOLLOWS:

Section 1. That the City Manager, is hereby authorized, on the advice and approval of the City Attorney, to open a Purchase Order for $1075.61 for payment of outstanding invoices with Staples Advantage to be drawn from Account Number 1001- 840-000-4244.

Section 2. That funds are available in the 2023-2024 Adopted Fiscal Year Budget in Account Number 1001-840-000-4244, for outstanding office supplies invoices.

Section 3. That a copy of this Resolution shall be filed in the offices of the City Clerk, City Attorney, City Manager, Public Works Street Maintenance, Recreation and the City Controller.

Section 4. That the Mayor shall sign and the City Clerk shall attest to the adoption of this Resolution.

ADOPTED this ________day of __________________, 2024

MAYOR OF THE CITY OF COMPTON
RESOLUTION NO.____________
PAGE 2
ATTEST:

CITY CLERK OF THE CITY OF COMPTON

STATE OF CALIFORNIA )

COUNTY OF LOS ANGELES ) SS

CITY OF COMPTON )
I, Vernell McDaniel, City Clerk of the City of Compton, hereby certify that the foregoing Resolution was adopted by the City Council of the City of Compton, signed by the Mayor and attested by the Clerk at a regular meeting thereof held on this _______day of ____________, 2024.

That said Resolution was adopted by the following vote, to wit:

AYES: COUNCILMEMBERS-
NOES: COUNCILMEMBERS-
ABSTAIN: COUNCILMEMBERS-
ABSENT: COUNCILMEMBERS-

CITY CLERK OF THE CITY OF COMPTON

5. June 4, 2024
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
FROM: CITY CONTROLLER
SUBJECT: A REQUEST TO RECEIVE AND FILE THE FISCAL YEAR 2020-2021 AUDITED FINANCIAL STATEMENTS, THE FISCAL YEAR 2020-2021 SINGLE AUDIT REPORT, AND THE FISCAL YEAR 2020-2021 UNAUDITED MANAGEMENT’S DISCUSSION AND ANALYSIS OF THE CITY OF COMPTON

SUMMARY
Adoption of this Resolution will formally acknowledge the receipt and filing of the Fiscal Year 2020-2021 Single Audit Report and the issuance of related financial statements.

BACKGROUND
Eadie & Payne LLP has audited the Fiscal Year 2020-2021 financial statements for the City of Compton as is required by the City to remain compliant with bond contractual requirements and granting agency requirements.

The audit consisted of the examination of the financial statements of the governmental activities, business related activities, use of each major fund, and the aggregate remaining fund information. The audit report includes the comprised related notes to the financial statements for the City of Compton as of June 30, 2021. The auditor performed tests of the City of Compton’s compliance with provisions of applicable laws, regulations, contracts, and agreements, including grant agreements. The audit additionally included services to report on supplementary information other than the Required Supplementary Information (RSI) that accompanies City of Compton’s financial statements. Services, such as comparing and reconciling accounting information and other records used to prepare the financial statements in accordance with the auditing standards generally accepted in the United States of America, were provided. Upon completion of the audit, Eadie & Payne LLP provided a written report and an opinion of the financial statements.

The objective of their audit was to provide an opinion as to whether the City’s financial statements are appropriately and accurately presented in conformity with U.S. Generally Accepted Accounting Principles (GAAP). The objective also includes reporting on the precedence of internal controls over financial reporting in accordance to the laws and regulations set by the Government Auditing Standards.

The City has prepared its Management’s Discussion and Analysis for Fiscal Year 2020- 2021 (the “MD&A”) to accompany the audited financial statements; however, the MD&A was not prepared and submitted to Eadie & Payne LLP in time to be included in its review of the City’s financial statements. The audit letter submitted by Eadie & Payne LLP states Staff Report – Resolution to Receive and File the Fiscal Year 2020-2021 Audit June 4, 2024
2 that, while the missing MD&A is required by the Governmental Accounting Standards Board as an essential part of the financial reporting for placing the City’s basic financial statements in an appropriate operational, economic, or historical context, the opinion provided by Eadie & Payne LLP on the City’s basic financial statements is not affected by the missing information.

STATEMENT OF THE ISSUE
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. As part of obtaining reasonable assurance about whether the financial statements are free of material misstatements, the auditor performed tests on the City of Compton’s compliance with provisions of applicable laws, regulations, contracts, and agreements, including grant agreements.

The Uniform Guidance requires that the auditor plan and perform the audit to obtain reasonable assurance about whether the City has complied with federal statutes, regulations, and the terms and conditions of federal awards applicable to major programs.

The purpose of these procedures was to express an opinion of the City of Compton’s compliance with requirements applicable to each of its major programs in their report on compliance issued pursuant to the Uniform Guidance.

Financial Highlights:
The assets and the deferred outflows of resources of the City exceeded its liabilities and deferred inflows of resources at the close of the Fiscal Year 2020- 2021 by approximately $5.1 million (net position), which is approximately $105.1 million higher than the previous year's net position. This is due primarily to a City- wide valuation of capital assets and an increase in tax revenue, including property taxes and sales taxes. While franchise tax and special assessment tax revenue remained mostly flat relative to fiscal year 2019-20, property tax and sales tax revenue improved relative to the prior year by approximately $12.0 million and $7.1 million, respectively. The unrestricted portion of net position as of June 30, 2021 increased by approximately $21.4 million to ($256,963,174) accumulating more resources that may be used to meet the City’s ongoing obligations to citizens and creditors.
As of the close of the current fiscal year, the City’s Governmental Funds (e.g.

General Fund, Capital Projects Funds, Special Revenue Funds, etc.) reported combined fund balances of approximately $169.6 million, an increase of approximately $59.1 million from the prior year. Of this amount, $172.5 million, or approximately 102.1%, of total fund balances are reported as either “Nonspendable” ($10.5 million), "Assigned" ($140 thousand), “Committed” ($3.4 million), or “Restricted” ($162.2 million) fund balances, leaving negative $(6.7 million) available as Unassigned for use at the City’s discretion. This increase in the City's governmental funds combined fund balances reported was primarily Staff Report – Resolution to Receive and File the Fiscal Year 2020-2021 Audit June 4, 2024
3 driven by increases in tax revenue (by approximately $11 million) and an influx of bond proceeds (by approximately $41.8 million) from the 2021 Sales Tax Revenue Bonds issued in March 2021.
The City’s net capital assets (land, buildings, equipment, infrastructure, less accumulated depreciation) were at $208.8 million as of June 30, 2021, increasing by $83.7 million over the previous year due mainly to a valuation of capital assets that the City had been performed which recognized prior unrecorded capital assets ($73.4 million), as well as additions and improvements during Fiscal Year 2020- 2021 for streets and pavement ($14.5 million), and for Gonzales Park solar arrays ($637.5 thousand).
The City’s net long-term liabilities increased by $67.3 million to $466.2 million, primarily as the result of issued bonds of $41 million during March of 2021 along with Pension and OPEB liability increases of $8.3 million and of $20.0 million respectively. Offsets to these increases occurred from principal payments made by the City on exiting bonds payable, notes and loans payable. The City’s financial position was elevated during Fiscal Year 2020-2021 with the removal of two “qualified” opinions from the City’s Single Audit and audited financial statements. Prior to Fiscal Year 2020-2021, the City maintained a “qualified” audit opinion on its valuation of Capital Assets, as well as on the City’s reporting of Housing Authority Equity balances. During Fiscal Year 2020-2021 City staff performed the necessary research to rectify the valuations and reporting of these assets and liabilities. This follows the research done during the prior Fiscal Year 2019-2020 which saw the removal of two “qualified” audit opinions regarding the City’s recorded balances of Unearned Revenue and Loan Receivable. As of the Fiscal Year ended June 30, 2021 only one “qualified” opinion has remained for which research has begun for an anticipated rectification within the next audit report.
Property Taxes increased by approximately $12.0 Million, 24.6%, primarily as a result of an increase in assessed valuation from new non-residential construction (a 7.54% increase as shown in the Proposition 111 Analysis of the Office of the Assessor of Los Angeles County).
Sales Taxes increased by approximately $7.1 Million or 33%, as a result of increased spending volume.
Utility User Taxes increased by approximately $1.1 million, 10.2%, as a result of increased residential utility usage incurred from shut down orders in Los Angeles County during the Covid-19 pandemic.

Audit Findings:

Staff Report – Resolution to Receive and File the Fiscal Year 2020-2021 Audit June 4, 2024
4 In addition to the qualified opinion on the audited financial statements, the City received an updated list of auditor findings. Auditor findings are deficiencies found by the auditors while conducting the audit in areas of internal control, accounting errors, and non- compliance with grant, legal, or contractual requirements.

Corrective Action Plan:

The City Controller and the City Manager have provided responses as well as a corrective action plan to the auditor to address the findings and matters receiving a qualified audit opinion. In order for the City to overcome these findings the City Controller’s Department is currently working with the City Manager’s Department to do the following:
Implement new policies and procedures,
Cost Allocation Plan Update and Refinement
Accounting research to rectify past accounting errors
Appropriately implement financial accounting software and program reports where needed
Provide Training
Implementing the corrective action plan provided to the auditors, as well as the steps described above will remove audit findings and audit qualification matters so that the City can operate more efficiently and effectively, obtain more opportunities for outside financing, and become a model for other cities to follow. The audit findings signify that some existing City practices allow for the opportunity for the misappropriation of City assets, as well as the possibility of losing granting opportunities.

FISCAL IMPACT
The impact of completing the Fiscal Year 2020-2021 Audit and releasing the Fiscal Year 2020-2021 Audited Financial Statements as well as the FY2021 Single Audit Report by the City’s auditors allows the City to remain in compliance with grant and contractual requirements. Adoption will also greatly assist with removing the City from the State of California Auditor Department’s list of cities with the greatest fiscal risk in the State of California.

RECOMMENDATION
It is the recommendation of staff that the City Council receive and file the attached set of Audited Financial Statements for Fiscal Year 2020-2021, the Single Audit Report for Fiscal Year 2020-2021, and the MD&A for Fiscal Year 2020-2021.

SHARON RAHBAN NAVIZADEH

CITY CONTROLLER
Staff Report – Resolution to Receive and File the Fiscal Year 2020-2021 Audit June 4, 2024
5 APPROVED FOR FORWARDING:

Willie A. Hopkins Jr.

RESOLUTION NO. _________
A REQUEST TO RECEIVE AND FILE THE FISCAL YEAR 2020-2021 AUDITED FINANCIAL STATEMENTS, THE FISCAL YEAR 2020-2021 SINGLE AUDIT REPORT, AND THE FISCAL YEAR 2020-2021 UNAUDITED
MANAGEMENT’S DISCUSSION AND ANALYSIS OF THE CITY OF

COMPTON
WHEREAS, adoption of this Resolution will formally acknowledge the receipt and filing of the Fiscal Year 2020-2021 Single Audit Report and the issuance of related financial statements; and
WHEREAS, the audit consisted of the examination of the financial statements of the governmental activities, business related activities, use of each major fund, and the aggregate remaining fund information. The audit report includes the comprised related notes to the financial statements for the City of Compton as of June 30, 2021. The auditor performed tests of the City of Compton’s compliance with provisions of applicable laws, regulations, contracts, and agreements, including grant agreements. The audit additionally included services to report on supplementary information other than RSI that accompanies City of Compton’s financial statements. Services, such as comparing and reconciling accounting information and other records used to prepare the financial statements in accordance with the auditing standards generally accepted in the United States of America, were provided. Upon completion of the audit, Eadie & Payne LLP provided a written report and an opinion of the financial statements.

WHEREAS, the objective of the audit was to provide an opinion as to whether the City’s financial statements are appropriately and accurately presented in conformity with U.S.

Generally Accepted Accounting Principles (GAAP). The objective also includes reporting on the precedence of internal controls over financial reporting in accordance to the laws and regulations set by the Government Auditing Standards.

WHEREAS, the City has prepared its Management’s Discussion and Analysis for Fiscal Year 2020-2021 (the “MD&A”) to accompany the audited financial statements; however, the MD&A was not prepared and submitted to Eadie & Payne LLP in time to be included in its review of the City’s financial statements. The audit letter submitted by Eadie & Payne LLP states that, while the missing MD&A is required by the Governmental Accounting Standards Board as an essential part of the financial reporting for placing the City’s basic financial statements in an appropriate operational, economic, or historical context, the opinion provided by Eadie & Payne LLP on the City’s basic financial statements is not affected by the missing information.

WHEREAS, an audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; therefore, their audit involved judgment about the number of transactions to be examined and the areas to be tested. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

WHEREAS, an audit is not designed to provide assurance on internal control or to identify significant deficiencies or material weaknesses. However, during the audit, the auditor communicated to management and those charged with governance internal control related matters that are required to be communicated under AICPA professional standards, Government Auditing Standards, and the Uniform Guidance.

WHEREAS, as part of obtaining reasonable assurance about whether the financial statements are free of material misstatement, the auditor performed tests of City of Compton’s compliance with provisions of applicable laws, regulations, contracts, and agreements, including grant agreements. However, the objective of those procedures was not to provide an opinion on overall compliance and they did not express such an opinion in the City’s report on compliance issued pursuant to Government Auditing Standards.

RESOLUTION NO. _________
2 WHEREAS, the Uniform Guidance requires that the auditor also plan and perform the audit to obtain reasonable assurance about whether the City has complied with federal statutes, regulations, and the terms and conditions of federal awards applicable to major programs. Their procedures consisted of tests of transactions and other applicable procedures described in the OMB Compliance Supplement for the types of compliance requirements that could have a direct and material effect on each of City of Compton’s major programs. The purpose of these procedures was to express an opinion on City of Compton’s compliance with requirements applicable to each of its major programs in their report on compliance issued pursuant to the Uniform Guidance.

WHEREAS, the auditors provided a “qualified” opinion on certain parts of the financial statements.

WHEREAS, a qualified opinion on these matters can change to an unqualified opinion in future years’ audits when those particular matters are rectified. The City’s Accounting Division is continuously performing the accounting research and work necessary to correct these matters.

WHEREAS, in addition to the qualified opinion on the audited financial statements, the City received an updated list of auditor findings. Auditor findings are deficiencies found by the auditors while conducting the audit in areas of internal control, accounting errors, and non-compliance with grant or contractual requirements.

WHEREAS, the City Controller and the City Manager have provided responses as well as a corrective action plan to the auditor to address the findings and matters receiving a qualified audit opinion. In order for the City to overcome these findings the City Controller’s Department is currently working with the City Manager’s Department to do the following:
Implement new policies and procedures,
Cost Allocation Plan Update and Refinement
Capital/Fixed Assets Valuation
Accounting research to rectify past accounting errors
Appropriately implement financial accounting software and program reports where needed
Provide Training
WHEREAS, implementing the corrective action plan provided to the auditors, as well as the steps described above will remove audit findings and audit qualification matters so that the City can operate more efficiently and effectively, obtain more opportunities for outside financing, and become a model for other cities to follow. The audit findings signify that some existing City practices allow for the opportunity for the misappropriation of City assets, as well as the possibility of losing granting opportunities.

WHEREAS, the impact of completing the Fiscal Year 2020-2021 Audit and releasing the Fiscal Year 2020-2021 Audited Financial Statements as well as the Fiscal Year 2020-2021 Single Audit Report by the City’s auditors allows the City to remain in compliance with grant and contractual requirements. Adoption will also greatly assist with removing the City from the State of California Auditor Department’s list of cities with the greatest fiscal risk in the State of California.

WHEREAS, it is the recommendation of staff that the City Council adopt this Resolution to receive and file the attached set of Audited Financial Statements for Fiscal Year 2020- 2021, and the Single Audit Report for Fiscal Year 2020-2021.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF COMPTON DOES HEREBY RESOLVE AS FOLLOWS:

Section 1. Receive and File the Fiscal Year 2020-2021 Audited Financial Statements, Fiscal Year 2020-2021 Single Audit, and the unaudited MD&A.

RESOLUTION NO. _________
3 Section 2. That a copy of this Resolution shall be filed in the offices of the City Clerk, City Attorney, City Manager, and City Controller.

Section 3.That the Mayor shall sign and the City Clerk shall attest to the adoption of this Resolution.

ADOPTED this ____________ day of _____________, 2024.
________________________________

MAYOR OF THE CITY OF COMPTON
ATTEST:
________________________________

CLERK OF THE CITY OF COMPTON

STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) ss

CITY OF COMPTON )
I, Vernell McDaniel, City Clerk of the City of Compton, hereby certify that the foregoing Resolution was adopted by the City Council of the City of Compton, signed by the Mayor and attested by the City Clerk at a regular meeting thereof held on this ___________ day of ________________, 2024.

That said Resolution was adopted by the following vote, to wit:

AYES: COUNCILMEMBERS -
NOES: COUNCILMEMBERS -
ABSTAIN: COUNCILMEMBERS -
ABSENT: COUNCILMEMBERS -
____________________________________

CITY CLERK OF THE CITY OF COMPTON

CITY OF COMPTON

SINGLE AUDIT REPORT
FOR THE YEAR ENDED JUNE 30, 2021

CITY OF COMPTON

TABLE OF CONTENTS
JUNE 30, 2021

Page
Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ............................................................................................................................ 1 Independent Auditor’s Report on Compliance for Each Major Program; Report on Internal Control over Compliance; and Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance ........................................................................................................................................... 3 Schedule of Expenditures of Federal Awards and Schedule of Findings and Questioned Costs ............ 6 Schedule of Expenditures of Federal Awards ..................................................................................... 7 Notes to the Schedule of Expenditures of Federal Awards ................................................................. 8 Schedule of Findings and Questioned Costs ...................................................................................... 9 Summary Schedule of Prior Audit Findings ...................................................................................... 32

3880 Lemon St., Ste. 300
Riverside, CA 92501
P.O. Box 1529
Riverside, CA 92502-1529
951-241-7800
www.eadiepaynellp.com
-
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INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL

STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS The Honorable City Council
City of Compton
Compton, California
We have audited, 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, the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of City of Compton, California (the City) as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements, and have issued our report thereon dated April 18, 2024. Our report includes qualified opinions on those financial statements, because the City has not maintained sufficient records and we were unable to obtain sufficient appropriate audit evidence about the allocation of cash to the various funds. In addition, our report includes an emphasis of matters paragraph to bring attention to deficit fund balances in the general fund and other funds totaling approximately $39 million.

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

Our consideration of internal control over financial reporting was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that have not been identified. However, as described in the accompanying schedule of findings and questioned costs, we did identify certain deficiencies in internal control that we consider to be material weaknesses and significant deficiencies. -2-
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. We consider the deficiencies described in the accompanying schedule of findings and questioned costs as findings 2021-009 and 2021-010 (marked MW) to be material weaknesses.

A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. We consider the deficiencies described in the accompany schedule of findings and questioned as findings 2021-011 to 2021-016 (marked SD) to be significant deficiencies.

Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements.

However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed instances of noncompliance or other matters that are required to be reported under Government Auditing Standards, and which are described in the accompanying schedule of findings and questioned costs as finding 2021-017 (marked NC).

City of Compton's Response to Findings
The City's response to the findings identified in our audit is described in the accompanying schedule of findings and questioned costs. The City's response was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it.

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

Riverside, California
May 24, 2024

3880 Lemon St., Ste. 300
Riverside, CA 92501
P.O. Box 1529
Riverside, CA 92502-1529
951-241-7800
www.eadiepaynellp.com

-3-

INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM; REPORT ON INTERNAL CONTROL OVER COMPLIANCE; AND REPORT ON SCHEDULE OF

EXPENDITURES OF FEDERAL AWARDS REQUIRED BY THE UNIFORM GUIDANCE

The Honorable City Council
City of ComptonCity of Compton
Compton, California

Report on Compliance for Each Major Federal Program
We have audited City of Compton’s (the City) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of the City’s major federal programs for the year ended June 30, 2021. The City’s major federal programs are identified in the summary of auditor’s results section of the accompanying schedule of findings and questioned costs.

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

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

We believe that our audit provides a reasonable basis for our qualified opinion on compliance for the major federal program. However, our audit does not provide a legal determination of the City’s compliance.

-4-

Basis for Qualified Opinion on Assistance Listing Number 14.871 Section 8 Housing Choice Vouchers

As described in the accompanying schedule of findings and questioned costs, the City did not comply with requirements regarding Assistance Listing Number 14.871 Section 8 Housing Choice Vouchers as described in finding number 2021-002 for reporting. Compliance with such requirement is necessary, in our opinion, for the City to comply with the requirements applicable to that program.

Qualified Opinion on Assistance Listing Number 14.871 Section 8 Housing Choice Vouchers

In our opinion, except for the noncompliance described in the Basis for Qualified Opinion paragraph, the City complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on Assistance Listing Number 14.871 Section 8 Housing Choice Vouchers for the year ended June 30, 2021.

Unmodified Opinion on Each of the Other Major Federal Programs

In our opinion, the City complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its other major federal programs identified in the summary of auditor’s results section of the accompanying schedule of findings and questioned costs for the year ended June 30, 2021.

Other Matters
The results of our auditing procedures disclosed other instances of noncompliance which are required to be reported in accordance with the Uniform Guidance and which are described in the accompanying schedule of findings and questioned costs as items 2021-001 and 2021-004 to 2021-007. Our opinion on each major federal program is not modified with respect to these matters.

The City’s response to the noncompliance findings identified in our audit is described in the accompanying schedule of findings and questioned costs. The City’s response was not subjected to the auditing procedures applied in the audit of compliance and, accordingly, we express no opinion on the response.

Report on Internal Control over Compliance
The management of the City is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the City’s internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control over compliance.

Our consideration of internal control over compliance was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that have not been identified. However, as discussed below, we did identify certain deficiencies in internal control over compliance that we consider to be material weaknesses and significant deficiencies.

-5-

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 normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. We consider the deficiencies in internal control over compliance described in the accompanying schedule of findings and questioned costs as items 2021-001 and 2021-002 to be material weaknesses.

A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. We consider the deficiencies in internal control over compliance described in the accompanying schedule of findings and questioned costs as items 2021-003, 2021-006 to 2021-008 to be significant deficiencies.

The City's response to the internal control over compliance findings identified in our audit is described in the accompanying schedule of findings and questioned costs. The City's response was not subjected to the auditing procedures applied in the audit of compliance and, accordingly, we express no opinion on the response.

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 of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.

Report on Schedule of Expenditures of Federal Awards
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 as of and for the year ended June 30, 2021, and the related notes to the financial statements which collectively comprise the City’s basic financial statements.

We have issued our report thereon dated May 8, 2024, which contains qualified opinions on those financial statements. Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively comprise the basic financial statements as a whole. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by the Uniform Guidance and is 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 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 schedule of expenditures of federal awards is fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Riverside, California
May 24, 2024

-6-

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND

SCHEDULE OF FINDINGS AND QUESTIONED COSTS

See accompanying notes to Schedule of Expenditures of Federal Awards and Independent Auditor's Report on Compliance for Each Major Program; Report on Internal Control over Compliance; and Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance.
-7-

CITY OF COMPTON

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2021

Total FederalAwards ExpendedFederal Program for Loan orFederal Grantor / Pass-through Grantor / Assistance Listing Identification Federal Expenditures to Loan GuaranteeNumberNumberExpendituresSubrecipientsProgramsU.S. Department of Housing and Urban DevelopmentCDBG - Entitlement Grants ClusterDirect:Community Development Block Grants/Entitlement Grants 14.218 B-19-MC-06-0515 1,380,679$ 116,057$ -$ COVID-19-CDBG - CV, Cares Act B-20-MW-06-0515 4,068 - - Total CDBG - Entitlement Grants Cluster1,384,747 116,057 - Direct:Community Development Block Grants Section 108Section 108 Note Payable - current expenditures 14.248 Loans 506,125$ -$ 506,125$ Section 108 Loans Receivable - balance at beginning of year 522,691 - 522,691 Total CDBG Section 1081,028,816 - 1,028,816 Direct:Community development Block Grants/Disaster RecoveryGrants (DRGR) 14.228 B-08-MN-06-0505 4,420 - - Direct:14.239 M-19-MC-06-0506 148,848 - - Housing Voucher ClusterDirect:14.871 CA-071 8,699,620 - - Direct:CARES Act - Supplemental Housing Assistance Payment (HAP) Funding Impacted by COVID-19, Extraordinary Circumstances 14.HCC 300,953 - - CARES Act -Supplemental Administative Fee Funding Impacted by COVID-19 67,493 - - 368,446 - - Total Housing Voucher Cluster9,068,066 - - Total U.S. Department of Housing and Urban Development12,663,713 116,057 2,057,632 U.S. Department of JusticeDirect:COVID-19 - Coronavirus Emergency Supplemental Funding Program 16.034 2020-VD-BX-1040 149,719 - - Total U.S. Department of Justice149,719 - - U.S. Department of TreasuryPass Through CA Department of Finance (#11918):Coronavirus Relief Fund (CRF) 21.019 1,210,414 - - Total U.S. Department of Treasury1,210,414 - - Total Expenditures of Federal Awards14,023,846$ 116,057$ 2,057,632$ Program or Cluster TitleHOME Investment Partnership ProgramSection 8 Housing Choice Vouchers

See accompanying notes to Schedule of Expenditures of Federal Awards and Independent Auditor's Report on Compliance for Each Major Program; Report on Internal Control over Compliance; and Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance.
-8-

CITY OF COMPTON

NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2021

1. BASIS OF PRESENTATION
The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal award activity of City of Compton (City) under programs of the federal government for the year ended June 30, 2021. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the City, it is not intended to and does not present the financial position, changes in financial position, or cash flows of the City.

2. BASIS OF ACCOUNTING
The accompanying Schedule of Expenditures of Federal Awards is presented using the modified accrual basis of accounting. Such expenditures are recognized following the Cost Principles contained in the Uniform Guidance wherein certain types of expenditures are not allowable or are limited as to reimbursement.

3. INDIRECT COST RATE
The City has not elected to use the 10% de minimis cost rate.

4. SUBAWARDS
The City passes through Federal awards to certain subrecipients. The programs and amounts passed through as of June 30, 2021 are as follows:

SubawardsCDBG - Entitlement Grants ClusterERD Campfire Safety Self 55,000$ ERD Domestic Violence Prevention 13,457 Champions of Caring 17,600 Youth Building 20,000 Fair Housing 10,000 Total Subawards116,057$ Program Name

5. LOAN PROGRAMS WITH CONTINUING COMPLIANCE REQUIREMENTS The City participates in the Community Development Block Grants Section 108 Loan Guarantees (Assistance Listing No. 14.248) of the U.S. Department of Housing and Urban Development, which is subject to continuing compliance requirements for outstanding loans. The program’s outstanding balance on loans with continuing compliance requirements as of June 30, 2021 are as follows:

Assistance Outstanding Listing Number Program NameBalance at June 30, 202114.248 Rosewood Family Loan 378,667$ 14.248 Fatburger Loan 144,024 522,691$

See accompanying notes to Schedule of Expenditures of Federal Awards and Independent Auditor's Report on Compliance for Each Major Program; Report on Internal Control over Compliance; and Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance.
-9-

CITY OF COMPTON

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2021

SUMMARY OF AUDITOR'S RESULTSFinancial StatementsType of report the auditor issued on whether the financial statementsaudited were prepared in accordance with GAAP: QualifiedInternal control over financial reporting:• Material weakness identified? x Yes No • Significant deficiency identified? x Yes None reportedNoncompliance material to financial statements noted? x Yes No Federal AwardsInternal control over major federal programs:• Material weakness identified? x Yes No • Significant deficiency identified? x Yes None reportedType of auditor's report issued on compliancefor major federal programs:Any audit findings disclosed that are required to bereported in accordance with 2 CFR 200.516(a)? x Yes No Identification of major federal programs:Assistance Listing NumberName of Federal Program or Cluster14.871 Section 8 Housing Choice Vouchers14.218 CDBG-Entitlement Grants Cluster21.019 Coronavirus Relief Fund (CRF)14.248 CDBG- Section 108Dollar threshold used to distinguish between type A and type B programs:Auditee qualified as low-risk auditee? Yes x No 750,000$ Qualified Opinion and Unmodified Opinion

-10-

CITY OF COMPTON

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2021

INDEX

CURRENT YEAR

MAJOR FEDERAL AWARD PROGRAMS
General
Filing of Single Audit Report 2021-001

Department of Housing and Urban Development – Section 8 Housing Choice Vouchers Reporting 2021-002
Allowable Costs/Cost Principles 2021-003
Allowable Costs/Cost Principles 2021-004
Special Tests and Provisions 2021-005

Department of Treasury – Coronavirus Relief Fund
Activities Allowed or Unallowed 2021-006

Department of Housing and Urban Development – Community Development Block Grant Reporting 2021-007
Allowable Costs/Cost Principles 2021-008

FINANCIAL STATEMENTS 2021-009 to 2021-017

PRIOR YEAR
MAJOR FEDERAL AWARD PROGRAMS 2020-001 to 2020-004
2019-001 to 2019-008
2018-001 to 2018-012

FINANCIAL STATEMENTS 2020-005 to 2020-007
2019-009 to 2019-034
2018-013 to 2018-040

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -11-

CITY OF COMPTON
SCHEDULE OF FINDINGS AND QUESTIONED COSTS – FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2021

2021-001 – Filing of Single Audit Report (MW, NC)

Criteria: Pursuant to the Office of Management and Budget (OMB) 2 CFR Part 200, Appendix XI, Section 8-7- 3, IV. Due Date for Audit Reports, the copy of the data collection from should be filed ‘with the Federal Audit Clearinghouse (FAC) as the date 9 months after the end of the audit period”. The OMB extended the Single Audit submission deadline for fiscal years ended June 30, 2020 and June 30, 2021 by six months.

Condition: The City did not complete the audit and submit the Single Audit Reporting Package (the City's audited financial statements and single audit reports) for the fiscal years ended June 30, 2012, 2013, 2014, 2015, 2016, 2017, 2018, and 2019 within nine months after the end of audit period. The City did not complete the audit and submit the Single Audit Reporting Package for the fiscal years ended June 30, 2020 and 2021 within 15 months after the end of the audit period (the extended deadline).

Cause: The City has been severely behind on its recording and reconciliations for financial transactions. The City’s Single Audit for 2013 was not completed until February of 2016. The City's predecessor auditor withdrew from the audit after issuance of the 2014 financial statements in November 2016 and did not issue a Single Audit report. Due to substantial employee turnover within the City at all levels, and incomplete records, the 2015, 2016, and 2017 audits were not completed and City did not issue financial statements. The City has been working diligently to update its records since 2018, however it still continues to experience a lack of qualified personnel and substantial employee turnover in the City Controller’s Office.

Effect or Potential Effect: Failure to submit the required Single Audit Reporting Package timely automatically results in the City not qualifying for low risk auditee status for the following year's single audit. In addition, failure to file the required Single Audit Reporting Package timely could result in the loss of federal funding.

Questioned Cost: None

Context: The physical single audit reports for fiscal years 2015, 2016, and 2017, were submitted to the U.S.

Department of Housing and Urban Development (Attn: Mr. Miguel Fontanez, Director of Housing Voucher Financial Management Division) at the Office of Public and Indian Housing, Washington, DC 20410-5000 on March 27, 2019. The Single Audit Reporting Package for fiscal years 2019 and 2020 were submitted on April 28, 2021 and March 28, 2022, respectively.

Statistical Sampling Validity: Not applicable. Sampling was not performed in relation to this finding.

Repeat of a Prior-Year Finding: 2020-003, 2019-007, 2018-011, 2017-011, 2016-007, 2015-010, 2014-009

Recommendation: We recommend that the City bring its accounting records up to date and have financial statement and Single Audits prepared timely. We also recommend the City develop, document, and implement policies and procedures for timely submission of the Single Audit Reporting Package.

Management Response and Corrective Action Plan
City's Response: The City concurs with the recommendation.

Corrective Action Plan: The City has hired outside CPA's with the goal of completing all audits through FY 2023 by December 2024.

Planned Implementation Date: December 2024

Responsible Person(s): Sharon Rahban, City Controller

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -12-
2021-002 – Missing Reports (MW, NC)

Federal Program Title: Section 8 Housing Choice Vouchers Federal Catalog Number: 14.871
Federal Agency: U.S. Department of Housing and Urban Development Pass-Through Entity: Not applicable
Federal Award Number and Year: CA-071 - 2021
Category of Finding: Reporting

Criteria: The Office of Management and Budget 2021 Compliance Supplement states that the following reports are required to be submitted to the U.S. Department of Housing and Urban Development.

HUD-52681-B, Voucher for Payment of Annual Contributions and Operating Statement (OMB No. 2577-0169). The PHA submits this form monthly to HUD electronically via the VMS. Congress has instructed HUD to use VMS data to determine renewal funding levels. HUD also uses VMS data for other funding, monitoring, and SEMAP-related decisions. HUD relies on the audit of the key line items below to determine the reasonableness of the data submitted for the purposes of calculating funding under the program.

Financial Reports (OMB No. 2535-0107) – Financial Assessment Subsystem, FASS-PH. The Uniform Financial Reporting Standards (24 CFR section 5.801) require PHAs to submit timely GAAP-based unaudited and audited financial information electronically to HUD. The FASS-PH system is one of HUD’s main monitoring and oversight systems for the HCVP.

HUD-52648, SEMAP Certification – PHAs with jurisdiction in metropolitan Fair Market Rent areas have the option of submitting data to HUD with their annual SEMAP certifications on the percent of their tenant- based Section 8 families with children who live in and who have moved during the PHA fiscal year to low poverty census tracts in the PHA’s principal operating area. Submission of this information with the SEMAP certification makes the PHA eligible for bonus points under SEMAP (24 CFR section 985.3(h)).

HUD 60002, Section 3 Summary Report, Economic Opportunities for Low- and Very Low-Income Persons (OMB No. 2529-0043) – Each recipient that administers covered public and Indian housing assistance, regardless of the amount expended, and each recipient that administers covered housing and community development assistance in excess of $200,000 in a program year, must submit HUD 60002 information using the automated Section 3 Performance Evaluation and Registry System (SPEARS) (24 CFR sections 135.3(a)(1) and 135.90).

HUD-50058, Family Report (OMB No. 2577-0083) – The PHA is required to submit this form electronically to HUD each time the PHA completes an admission, annual reexamination, interim reexamination, portability move-in, or other change of unit for a family. The PHA must also submit the Family Report when a family ends participation in the program or moves out of the PHA’s jurisdiction under portability (24 CFR Part 908 and 24 CFR section 982.158).

Condition: We were unable to obtain the following reports: HUD-52681-B, FASS-PH, and HUD-52648.

Cause: Turnover of staff in the Housing Authority and delay in recruitment. Lack of internal control over the retention of program reports.

Effect or Potential Effect: The City is facing sanctions from the Office of Inspector General (OIG) with a reduced Section 8 Management Assessment Program (SEMAP) rating from High Performer to Standard Performer. A reduced rating may result in HUD withholding additional grant funds or offset the Housing Choice Voucher (HCV) administrative fees.

Questioned Cost: None.

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -13-

Context: The Housing Authority did not provide required reports.

Statistical Sampling Validity: Not applicable.

Repeat of a Prior-Year Finding: 2020-001, 2019-005, 2018-007 Recommendation: We recommend the City establish policies and procedures that will ensure the retention of program documents.

Management Response and Corrective Action Plan
City's Response: The City concurs with the recommendation.

Corrective Action Plan: The City Controller’s Office drafted a grants policy that is currently under review by City Management. Community development staff will ensure a succession plan is in place for any staff turnover and for report preparation compliance.

Planned Implementation Date: December 31, 2024

Responsible Person(s): City Manager, Community Development Director, and City Controller

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -14-
2021-003 – Incorrect Payrates (SD)

Federal Program Title: Section 8 Housing Choice Vouchers Federal Catalog Number: 14.871
Federal Agency: U.S. Department of Housing and Urban Development Pass-Through Entity: Not applicable
Federal Award Number and Year: CA-071 - 2021
Category of Finding: Allowable Costs/Cost Principles

Criteria: Title 2, Subtitle A, Chapter II, Part 200, General Provisions for Selected Items of Cost, Section 200.430, Compensation – Personal Services requires that costs of compensation are allowable to the extent that they satisfy specific requirements which in include that the total compensation of individual employees is determined and supported as provided in the Standards for Documentation of Personnel Expenses. The said standards require charges to Federal awards for salaries and wages must be based on records that must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.

Condition: The City uses personnel action forms (PA101) to document the approved payrates of City employees. During our audit, we noted that the payrates used to determine the amounts claimed for payroll costs associated with the program were lower than what was reflected in the PA 101 form.

Cause: The City approved retroactive pay increases for employees and the pay increases were processed as lump sum adjustments. The payroll records prior to the approval of the retroactive pay were not adjusted to reflect the change. The program costs were not adjusted either.

Effect or Potential Effect: The City missed the opportunity to claim higher payroll costs to the program.

Questioned Cost: None.

Context: Six instances of incorrect payrates were found out of 20 sample items. Since the costs claimed were lower than what they should have been, no questioned cost is reported.

Statistical Sampling Validity: Samples are haphazardly selected.

Repeat of a Prior-Year Finding: No
Recommendation: We recommend the City improve procedures to ensure that payrate changes are approved timely and payroll costs charged to the grant are also adjusted whenever payrate changes are approved.

Management Response and Corrective Action Plan
City's Response: The City concurs with the recommendation.

Corrective Action Plan: The general accounting policy will be updated for the accountant to check the payroll register to accrue retroactive pay changes to the correct period.

Planned Implementation Date: June 30, 2024

Responsible Person(s): City Controller

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -15-

2021-004 – Distribution of Hours Worked (NC)

Federal Program Title: Section 8 Housing Choice Vouchers Federal Catalog Number: 14.871
Federal Agency: U.S. Department of Housing and Urban Development Pass-Through Entity: Not applicable
Federal Award Number and Year: CA-071 – 2021
Category of Finding: Allowable Cost/Cost Principles

Criteria: Title 2, Subtitle A, Chapter II, Part 200, General Provisions for Selected Items of Cost, Section 200.430, Compensation – Personal Services requires that costs of compensation are allowable to the extent that they satisfy specific requirements which in include that the total compensation of individual employees is determined and supported as provided in the Standards for Documentation of Personnel Expenses. The said standards require charges to Federal awards for salaries and wages must be based on records that must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.

Federal award recipients should support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.

Condition: If an employee works on more than one program or fund, the employee’s salary or wages and benefits are distributed by the City to the respective programs or funds based on the number of hours worked. The basis for the distribution is the employee’s timecard. During our audit, we noted one employee’s timecard did not indicate the number of hours worked for Section 8 or another program/fund, however only 10% of his/her payroll cost was charged to Section 8.

Cause: The City was unable to provide the timecard that showed the hours worked by the employee by program/fund.

Effect or Potential Effect: Over or understatement of payroll cost charged to the program.

Questioned Cost: None.

Context: One exception out of 20 sample items.

Statistical Sampling Validity: Samples are haphazardly selected.

Repeat of a Prior-Year Finding: No
Recommendation: We recommend that the City improve procedures to ensure that they retain all timecards that reflect the distribution of costs to programs/funds and make them available for the auditors.

Management Response and Corrective Action Plan
City's Response: The City concurs with the recommendation.

Corrective Action Plan: The payroll policy will be updated to require that timecards be updated with supervisor signature if changes are made to change allocation to another fund.

Planned Implementation Date: June 30, 2024

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -16-
Responsible Person(s): City Controller

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -17-
2021-005 – Housing Quality Standards Inspection (NC)

Federal Program Title: Section 8 Housing Choice Vouchers Federal Catalog Number: 14.871
Federal Agency: U.S. Department of Housing and Urban Development Pass-Through Entity: Not applicable
Federal Award Number and Year: CA-071 – 2021
Category of Finding: Special Tests and Provisions

Criteria: The public housing agency (PHA) must inspect the unit leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control re-inspections.

Condition: In one instance, the City did not perform the required annual inspection.

Cause: We were informed that the HUD system did not release the address for inspection so no inspection was performed.

Effect or Potential Effect: The City’s failure to comply with stated requirements exposes the City to sanctions from the federal agency, including loss of funding.

Questioned Cost: None

Context: The exception was noted in one out of 60 participants tested. The City has noted that they will investigate the issue.

Statistical Sampling Validity: Samples are haphazardly selected.

Repeat of a Prior-Year Finding: No
Recommendation: We recommend the City to improve procedures to ensure that all annual inspections are performed.

Management Response and Corrective Action Plan
City's Response: The City concurs with the recommendation.

Corrective Action Plan: Policies will be enforced or monitored more closely by Housing Authority management to ensure all inspections and re-inspections are complete and documented.

Planned Implementation Date: December 31, 2024

Responsible Person(s): Community Development Director

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -18-
2021-006 – Incorrect Payrates (SD, NC)

Federal Program Title: Coronavirus Relief Fund
Federal Catalog Number: 21.019
Federal Agency: U.S. Department of the Treasury
Pass-Through Entity: CA Department of Finance
Federal Award Number and Year: N/A - 2021
Category of Finding: Allowable Costs/Cost Principles

Criteria: Title 2, Subtitle A, Chapter II, Part 200, General Provisions for Selected Items of Cost, Section 200.430, Compensation – Personal Services requires that costs of compensation are allowable to the extent that they satisfy specific requirements which in include that the total compensation of individual employees is determined and supported as provided in the Standards for Documentation of Personnel Expenses. The said standards require charges to Federal awards for salaries and wages must be based on records that must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.

Condition: The City used incorrect payrates when calculating payroll costs charged to the program.

Cause: When the City calculated the Fire Department payroll and payroll costs related to Covid Leave, they used a report that reflected payrates that were higher than what the payroll register reported.

Effect or Potential Effect: The City overstated the payroll costs charged to the program.

Questioned Cost: $32,314

Context: The exception was found in 10 out of 28 employees selected. The questioned cost is the amount projected to the entire population.

Statistical Sampling Validity: Samples are haphazardly selected.

Repeat of a Prior-Year Finding: No
Recommendation: We recommend the City enhance procedures to double check the payrates used when calculating charges to federal awards.

Management Response and Corrective Action Plan
City's Response: The City concurs with the recommendation.

Corrective Action Plan: The City has other eligible costs that were not claimed for this grant that can be used to offset the questioned cost. Procedures are already in place to enhance payrate calculations in the future.

Planned Implementation Date: Implemented as of April 2024

Responsible Person(s): City Controller

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -19-
2021-007 – Missing Reports (SD, NC)

Federal Program Title: Community Development Block Grant/Entitlement Grants Federal Catalog Number: 14.218
Federal Agency: U.S. Department of Housing and Urban Development Pass-Through Entity: No applicable
Federal Award Number and Year: B-19-MC-06-0515 - 2019
Category of Finding: Reporting

Criteria: The Office of Management and Budget 2021 Compliance Supplement states that the following reports are required to be submitted to the U.S. Department of Housing and Urban Development.

SF-425, Federal Financial Report – Applicable (cash status only) (this is the IDIS C04PR29 Cash on Hand Quarterly Report made available in IDIS on August 12, 2019, which allows grantees to generate this report by custom date ranges and export data to Excel and PDF)

Integrated Disbursement and Information System (IDIS) (OMB No. 25060077) – Grantees may include reports generated by IDIS as part of their annual performance and evaluation report that must be submitted for the CDBG Entitlement program 90 days after the end of a grantee’s program year.

(1) C04PR03 – Activity Summary Report
(2) C04PR26 – CDBG Financial Summary Report
(3) C04PR26 – CDBG-CV Financial Summary Report
(4) C04PR26 – CDBG Activity Summary by Selected Grant

Section 3 of the Housing and Urban Development Act of 1968 – The purpose of Section 3 is to ensure that employment and other economic opportunities generated by certain HUD financial assistance shall, to the greatest extent feasible, and consistent with existing federal, state, and local laws and regulations, be directed to low-and very low-income persons, particularly those who are recipients of government assistance for housing, and to business concerns which provide economic opportunities to low-and very low-income persons. Section 3 projects are housing rehabilitation, housing construction, and other public construction projects assisted under HUD programs that provide housing and community development financial assistance when the total amount of assistance to the project exceeds a threshold of $200,000.

Consolidated Annual Performance and Evaluation Report (CAPER) (24 CFR 91.520) -- A grantee’s CAPER, submitted through the IDIS e-Con Planning Suite, is due 90 days after the close of a jurisdiction’s program year.

Condition: We were unable to obtain the following reports: SF-425, Section 3 report and CAPER.

Cause: Turnover of staff and lack of internal control over the retention of program reports.

Effect or Potential Effect: The City’s failure to comply with stated reporting requirements exposes the City to sanctions from the federal agency, including loss of funding.

Questioned Cost: None

Context: The City did not provide the abovementioned reports.

Statistical Sampling Validity: Not applicable.

Repeat of a Prior-Year Finding: Yes, 2019-001, 2018-001 Recommendation: We recommend the City establish policies and procedures that will ensure the retention of program reports.

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -20-

Management Response and Corrective Action Plan
City's Response: The City concurs with the recommendation.

Corrective Action Plan: The City Controller drafted a grants policy which is currently under review by the City Manager, that includes succession planning in case of staff turnover and parameters for grant reporting compliance.

Planned Implementation Date: December 31, 2024

Responsible Person(s): City Manager, Grants Manager

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -21-
2021-008 – Incorrect Payrate and Hours Worked (SD)

Federal Program Title: Community Development Block Grant/Entitlement Grants Federal Catalog Number: 14.218
Federal Agency: U.S. Department of Housing and Urban Development Pass-Through Entity: No applicable
Federal Award Number and Year: B-19-MC-06-0515 - 2019
Category of Finding: Allowable Cost/Cost Principles

Criteria: Title 2, Subtitle A, Chapter II, Part 200, General Provisions for Selected Items of Cost, Section 200.430, Compensation – Personal Services requires that costs of compensation are allowable to the extent that they satisfy specific requirements which in include that the total compensation of individual employees is determined and supported as provided in the Standards for Documentation of Personnel Expenses. The said standards require charges to Federal awards for salaries and wages must be based on records that must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.

Condition: During our audit, we found one instance where the employee’s timecard did not reflect the number of hours worked for CDBG and another instance where the employee’s payrate did not agree to the payrate stated on the personnel action form (PA 101).

Cause: For the exception related to timecard: The City was unable to provide the timecard that showed the hours worked by the employee by program/fund.

For the exception related to payrate: The City approved retroactive pay increases for employees and the pay increases were processed as lump sum adjustments. The payroll records prior to the approval of the retroactive pay were not adjusted to reflect the change. The program costs were not adjusted either.

Effect or Potential Effect: Over or understatement of costs charged to the program.

Questioned Cost: None

Context: One exception related to timecard and another exception related to payrate were found, out of 20 items selected.

Statistical Sampling Validity: Samples are haphazardly selected.

Repeat of a Prior-Year Finding: No
Recommendation: We recommend the City improve procedures to ensure completeness and accuracy of payroll costs charged to federal programs.

Management Response and Corrective Action Plan
City's Response: The City concurs with the recommendation.

Corrective Action Plan: The general accounting policy will be updated for the accountant to check the payroll register to accrue retroactive pay changes to the correct period. The payroll policy will also be updated to require that timecards be updated with supervisor signature if changes are made to change allocation to another fund.

Planned Implementation Date: June 30, 2024

Responsible Person(s): City Controller

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -22-

CITY OF COMPTON
SCHEDULE OF FINDINGS AND QUESTIONED COSTS – FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2021

2021-009 – Allocation of Cash to City Funds/ Negative Cash Balances/ Fund Balance Deficits (MW)

Criteria: Negative cash balances occur within a fund when there is mismatch of expenditures and revenue. Since the City pools its cash, other funds (usually the General Fund) will cover temporary negative cash balances through interfund payable/receivable accounts. Interfund payable/receivable accounts should be settled within the current period.

In addition, the City should operate to maintain adequate fund balances in all of its funds to mitigate current and future risks, such as revenue shortfalls and unanticipated expenditures.

Condition: The City did not have consistent cash allocation and tracking procedures in place, which resulted in negative cash balances rolling forward from prior years through June 30, 2020. The City was able to reconcile the cash allocation among the various funds at June 30, 2021 in FY 2023, two years after the end of FY 2021. However, the City’s general ledger continues to report a negative cash balance in excess of $28.9 million in the general fund (Fund 1001) at June 30, 2021.

Furthermore, there are negative fund balances for various funds including the general fund, nonmajor governmental funds, and internal service funds.

Cause: There was a lack of policy over interfund transactions and weakness in internal control over reconciliations during FY 2021. Due to the vacancies in key positions in the City Controller’s Office, staff fell behind on the monthly reconciliations and monitoring of cash balances across funds. There was also a weakness in internal control over operational spending and lack of consideration of long-term financial planning.

Effect or Potential Effect: Cash allocation could be materially misstated. Operating cash deficiencies for amounts not properly recorded, reimbursed, or transferred could exist and not detected and corrected on a timely basis. The fund balance deficits could also have a significant effect on operations on a go- forward basis. City programs and services involved with the fund may be curtailed.

Repeat of a Prior-Year Finding: 2018-014, 2018-037, 2019-010, 2019-025

Recommendation: We recommend the City review cash balances on a regular basis and prepare a plan to eliminate these negative cash balances. Policies and procedures need to be put in place for the regular review of cash balances and the initiation of transfers for reimbursements as needed. We also recommend that management review the negative fund balances and the affected operations to make provisions to eliminate the deficit balances going forward.

Management Response and Corrective Action Plan

City's Response: The City concurs with the recommendation.

Corrective Action Plan: The City hired a consultant to prepare a cost allocation plan which will be implemented in FY22 and future years. The City hired a consultant to prepare a fiscal sustainability plan and fee study, and City has issued an RFP for utility rate study. Also, the City has issued a request for proposal for collection agency, as well as for SB90 collection consultant. The City has approved a contract for consultant to study fire OT cost analysis which greatly contributes to overspending in the general fund. All of these efforts are expected to alleviate the negative cash balances across funds, including the General Fund.

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -23-

Planned Implementation Date: December 31, 2024

Responsible Person(s): City Manager, City Controller

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -24-

2021-010 – Information Technology (IT) Controls (MW)

Criteria: IT controls are a critical mechanism for ensuring the integrity of information systems and the reporting of the City’s financial information. IT general controls (ITGC) are basic controls applied to IT systems. The objectives of ITGC are to ensure the integrity of data and processes that the IT systems support. ITGC have a pervasive effect on the City’s system of internal control over financial reporting.

Condition: During FY 2020, we evaluated the design and implementation of ITGCs and noted 23 findings. We communicated such findings to the IT department and City management. Because those findings reveal vulnerabilities to, or otherwise increase the potential for an attack on, information technology systems of the City, the details of the findings will not be published in this document.

Repeat of a Prior-Year Finding: 2018-040, 2019-034

Recommendation: Our recommendations will be communicated to the City Council through a separate confidential written report.

Management Response and Corrective Action Plan

City’s Response: The City concurs with the recommendation.

Corrective Action Plan: The City will update the IT risk assessment and develop a corrective action plan.

Planned Implementation Date: December 31, 2024

Responsible Person(s): City Manager, IT Director

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -25-
2021-011 – Contingent Liabilities (SD)

Criteria: The City has been named a defendant in numerous lawsuits and claims arising in the course of operations. In aggregate, these claims seek monetary damages in significant amounts. Insurance claims payable reflected on the financial statements should represent the actual obligations and liabilities for incidents that have occurred during the year. Additional accruals for probable losses relating to uninsured risks should be made for incidents occurring during the year when the loss estimates can be made. The City should also disclose the contingency when there could be a material effect to the financial statements.

Condition: The City Controller’s Office uses an actuarial report supplied by an outside actuary and risk management staff to record the liability for self-insurance claims. However, there are instances when contingent liabilities may have occurred, but they only learn about the liability when it is time to pay for the claim, which may be many months after the liability had been incurred. The City Attorney’s office tracks the lawsuits and status of the lawsuits. However, they do not always inform the risk management team about any probable losses in a timely manner.

Cause: There is no established procedure for timely communication between the City Attorney’s Office and the Risk Manager regarding potential contingent liabilities.

Effect or Potential Effect: Incomplete or inaccurate reporting of loss contingencies. Potential prior period adjustments.

Repeat of a Prior-Year Finding: No

Recommendation: The City should develop procedures to foster information-sharing between the City Attorney’s Office and the risk management team.

Management Response and Corrective Action Plan

City’s Response: The City concurs with the recommendation.

Corrective Action Plan: The City Attorney will provide litigation reports to keep all parties abreast of pending litigation.

Planned Implementation Date: April 31, 2024

Responsible Person(s): City Attorney, City Manager, Risk Manager

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -26-
2021-012 – Procurement Policy (SD)

Criteria: A current official written policy should be in place for procurement and contracts conforming to applicable federal statutes and the updated procurement requirements per 2 CFR part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance).

Condition: A grants policy which includes Uniform guidance on procurement and conflict of interest has been taken to the City Council for receive and file action in March 2022. The City Manager has yet to implement this policy and make it into the Standard Operating Manual.

Cause: Turnover in the City Manager position.

Effect or Potential Effect: Goods or services could be acquired in violation of the administrative requirements federal regulations and other procurement requirements, such as inappropriately acquired from debarred or suspended parties or providers. Failure to document and retain evidence that procurement procedures were followed could result in the need to reimburse federal funds.

Repeat of a Prior-Year Finding: 2019-029

Recommendation: We recommend the City adopt and implement an official written policy for procurement and contracting and Conflict of Interest Code that are in line with the requirements of the Uniform Guidance.

Management Response and Corrective Action Plan

City’s Response: The City concurs with the recommendation.

Corrective Action Plan: The City Manager will coordinate the implementation of the grants policy.

Planned Implementation Date: December 31, 2024

Responsible Person(s): City Manager

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -27-
2021-013 - Bank Reconciliations (SD)

Criteria: Bank reconciliations should be prepared and reviewed in a timely manner.

Condition: Bank reconciliations are not prepared and reviewed in a timely manner. While the City Controller’s Office has been working on preparing the bank reconciliations continuously since FY 2021, bank reconciliations for FY 2021 were completed only in FY 2023. As of April 2024, the City is working on bank reconciliations for FY 2024.

Cause: Weakness in internal control over reconciliations, lack of training, and lack of resources allocated to the bank reconciliation function. Due to the vacancies in key positions in the City Controller’s Office, staff fell behind on the monthly reconciliations of the over 30 bank accounts.

Effect or Potential Effect: Potential fraud and misstatements in cash and other accounts.

Repeat of a Prior-Year Finding: 2018-013, 2019-009

Recommendation: The City should dedicate appropriate resources and have City employees trained to perform monthly bank reconciliations for all City bank accounts. Subsequently, a documented review and approval of the bank reconciliations should be performed in a timely manner to ensure that any discrepancies are discovered and addressed appropriately.

Management Response and Corrective Action Plan
City’s Response: The City concurs with the recommendation.

Corrective Action Plan: In July of 2023 the City hired CPA firms and temp agency workers to assist City staff with catching up on bookeeping and on audit preparation including bank reconciliation. At that point the City was 24 months behind in the general checking bank rec. As of April 2024, the City is only 9 months behind. Improvement has been made, but full catchup of bank reconciliations is expected to be done by October 2024.

Planned Implementation Date: October 2024

Responsible Person(s): Sharon Rahban, City Controller

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -28-
2021-014 – Staffing (SD)
Criteria: City employees should have adequate qualifications, competency, and experience to effectively carry out day-to-day responsibilities directly correlated with their job description in a qualitative and timely manner.

Condition: The City Controller’s Office filled some vacancies since FY 2021 however it still has vacancies in positions that are vital in the City’s day-to-day accounting.

Cause: The City’s recruitment process is lengthy. Additionally, departments are encouraged to explore internal recruitments more extensively, rather than initiating external recruitments.

Effect or Potential Effect: Upper management has been compensating for the lack of lower management available in the City Controller’s Department, which results in delays of getting complex projects completed, i.e. financial statement audits, cost allocation plan revision, capital assets valuation, etc. The City Controller’s Department has been delayed in its financial statement audits and other projects because vacancies are preventing day-to-day accounting activities from being effectively carried out. This has resulted in the City not having enough resources to move other projects forward.

Repeat of a Prior-Year Finding: 2020-007

Recommendation: We recommend that the City implement a remedial action plan to adequately staff the departments with qualified and experienced individuals who can contribute immediately to the performance of its accounting functions.

Management Response and Corrective Action Plan

City’s Response: The City concurs with the recommendation.

Corrective Action Plan: The City has hired CPA firms and temp agencies to assist with catchup of work. The City is also en route to completing a compensation study that will likely yield compensation increases needed to attract the necessary talent to fully staff the controller's office with qualified personnel.

Planned Implementation Date: December 31, 2024

Responsible Person(s): City Manager, HR Director

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -29-
2021-015 – Internal Audits (SD)

Criteria: Internal audits should be performed to ensure that information processed is accurate and valid.

Departments should cooperate and make all information available for internal audits to be performed and completed effectively and efficiently.

Condition: There is a lack of cooperation from departments when supporting documentation is requested for internal audit purposes.

Cause: Departments other than the City Controller’s Office do not agree that providing information to the internal auditor is their responsibility. These departments are not willing to use resources to fulfill a task that they believe is not included in their job description. Internal audit requests have not been common practice in the City in the recent years and, therefore, might not have been addressed in job descriptions.

However, the City has been making efforts to resolve operational, accounting, and internal control issues that will allow the City to move forward.

Effect or Potential Effect: Lack of transparency results in information that cannot be considered timely or reliable. Additionally, failing to perform regular and timely internal audits creates an opportunity for malicious activities, including waste and abuse of City funds.

Repeat of a Prior-Year Finding: 2020-006

Recommendation: We recommend that City Council and City Management establish and reinforce policies and procedures that promote cooperation of all departments and educate them on the importance of checks and balances within departments across the City.

Management Response and Corrective Action Plan

City’s Response: The City concurs with the recommendation.

Corrective Action Plan: The City Manager will formally adopt the internal audit policy.

Planned Implementation Date: December 31, 2024

Responsible Person(s): City Manager

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -30-
2021-016 – Turnover and Lack of Consistent Leadership (SD)

Criteria: An entity in a governmental environment must have adequate and consistent, competent leadership demonstrating and exercising oversight responsibility.

Condition: The City has been experiencing a high degree of management turnover for years, since at least 2010, which can result in a lack of consistent leadership, lack of operational stability, and inefficient provision of services to its citizens. Between January 1, 2010, and January 1, 2024, more than ten different individuals served as City Manager. In addition, the City also experienced numerous turnover of the City Controller position in past years through FY 2021.

Cause: The high turnover has contributed to a lack of leadership and, in some cases, a lack of management oversight.

Effect or Potential Effect: In addition to potential effects noted above, for purposes of financial reporting, the City was unable to produce financial statements on a timely basis.

Repeat of a Prior-Year Finding: 2019-033

Recommendation: In line with SCO’s comment, we recommend the City evaluate its hiring practices for its upper management positions. In addition, the City should develop a succession plan that will help it to ensure continued leadership even during management turnover.

Management Response and Corrective Action Plan

City’s Response: The City concurs with the recommendation.

Corrective Action Plan: Per the State Auditor’s report of October 2022, the City Manager and HR Director will prepare hiring policies and succession plans.

Planned Implementation Date: December 31, 2024

Responsible Person(s): City Manager, HR Director

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -31-
2021-017 – Bond Compliance (NC)

Criteria: Governmental entities are subject to a variety of laws, regulations, and contracts that have a direct and material effect on their financial statements. Accordingly, governmental entities should establish a system of internal control over compliance to ensure compliance with laws, regulations, and contracts. Personnel assigned to monitor compliance should have the appropriate knowledge and experience related to the requirements.

Pursuant to Section 5.11 (c) of the Indenture dated July I, 1993 with US Bank, the City is required to cause the independent certified public accountant to deliver to the City and the trustee a certificate showing that during such fiscal year the City was in compliance with its rate covenant as set forth in Section 5.09.

SEC Rule 15c2-12 requires local governments issuing bonds to provide certain information to the Municipal Securities Rulemaking Board (MSRB) about the securities on an ongoing basis.

Condition: The City and the Successor Agency were not in compliance with reporting provisions of the indentures for various bonds for the fiscal year ended June 30, 2021 because the City's audited financial statements were not issued within 180 to 270 days of the year-end. Additionally the City and the Successor Agency were not in compliance with continuing disclosure requirements under SEC Rule15c2-

12. Cause: Lack of audited financial statements.

Effect or Potential Effect: Bonds could be deemed in default and could become due and payable. The City could not issue new bonds or refinance existing bonds.

Repeat of a Prior-Year Finding: 2018-036, 2019-024

Recommendation: We recommend the City develop a tactical plan to complete the audits for the City and become current by fiscal year 2024. For the long-term, we recommend the City develop, document, and implement policies and procedures to ensure the City's compliance with applicable laws, regulations, and contracts. Personnel assigned to monitor compliance should have the appropriate knowledge and experience with requirements.

Management Response and Corrective Action Plan

City’s Response: The City concurs with the recommendation.

Corrective Action Plan: The City has hired outside CPAs and temp agencies to assist with audit catchup, and expects to be caught up on all audits through FY 2023 by December 2024.

Planned Implementation Date: December 2024

Responsible Person(s): Sharon Rahban, City Controller

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -32-

CITY OF COMPTON

SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS

FEDERAL AWARDS

Finding No. Federal Program NameAssistance Listing No. Compliance Requirement(s) Status of Corrective Action Repeat Finding No.2020-001Section 8 Housing Choice Vouchers 14.871 Reporting (MW, NC)In progress; FY 2018 to FY 2020 have been submitted 2021-0022020-002Section 8 Housing Choice Vouchers 14.871Special Tests and Provisions - Rolling Forward Equity Balances (MW, NC) Resolved for FY 20212020-003 N/A; General finding N/A Filing of Single Audit Report (MW, NC)In progress; FY 2018 to FY 2020 have been submitted. 2021-0012020-004 N/A; General finding N/ASchedule of Expenditures of Federal Awards Preparation (SD, NC) Resolved for FY 20212019-001Community Development Block Grants/Entitlement Grants 14.218 Reporting (MW, NC)In progress. Grants policy was received and filed by the City Council in March 2022 but it needs to be implemented. 2021-0062019-002Community Development Block Grants/Entitlement Grants 14.218Program Income - Identification, Determination, Assessment, and Recording (MW, NC)Loans receivable balances were verified as of June 30, 2021. No program income in FY 2021.2019-003Community Development Block Grants/Entitlement Grants 14.218Program Income - CDBG Loan Listing (MW, NC)Loans receivable balances were verified as of June 30, 2021. No program income in FY 2021.2019-004Community Development Block Grants/Entitlement Grants 14.218Equipment and Real Property Management (MW, NC) Resolved for FY 20212019-005Section 8 Housing Choice Vouchers 14.871 Reporting (MW, NC) In progress 2021-0022019-006Section 8 Housing Choice Vouchers 14.871Special Tests and Provisions - Rolling Forward Equity Balances (MW, NC) Resolved for FY 20212019-007 N/A; General finding N/A Filing of Single Audit Report (MW, NC)In progress; FY 2018 to FY 2020 have been submitted. 2021-0012019-008 N/A; General finding N/ASchedule of Expenditures of Federal Awards Preparation (MW) Resolved for FY 20212018-001Community Development Block Grants/Entitlement Grants 14.218 Reporting (MW, NC)In progress. Grants policy was received and filed by the City Council in March 2022 but it needs to be implemented. 2021-0062018-002Community Development Block Grants/Entitlement Grants 14.218Program Income - Identification, Determination, Assessment, and Recording (MW, NC)Loans receivable balances were verified as of June 30, 2021. No program income in FY 2021.

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -33-

CITY OF COMPTON

SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS

FEDERAL AWARDS (CONTINUED)

Finding
No. Federal Program Name
Assistance
Listing No. Compliance Requirement(s) Status of Corrective Action Repeat Finding No. 2018-003
Community Development Block
Grants/Entitlement Grants 14.218
Program Income - CDBG Loan Listing
(MW, NC)
Loans receivable balances
were verified as of June 30,
2021. No program income in
FY 2021.
2018-005
Community Development Block
Grants/Entitlement Grants 14.218
Allowable Costs/Cost Principles - Lack
of Drawdown Supporting
Documentation (MW, NC) Not a finding in 2021
2018-006
Community Development Block
Grants/Entitlement Grants 14.218
Equipment and Real Property
Management (MW, NC) Resolved for FY 2021
2018-007
Section 8 Housing Choice
Vouchers 14.871 Reporting (MW, NC)
In progress; FY 2018 to FY
2020 have been submitted 2021-002
2018-010
Section 8 Housing Choice
Vouchers 14.871
Special Tests and Provisions - Rolling
Forward Equity Balances (MW, NC) Resolved for FY 2021
2018-011 N/A; General finding N/A Filing of Single Audit Report (MW, NC) In progress; FY 2018 to FY
2020 have been submitted. 2021-001
2018-012 N/A; General finding N/A
Schedule of Expenditures of Federal
Awards Preparation (MW) Resolved for FY 2021
Findings for FYE 2017 and prior have been omitted in this report.

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -34-

CITY OF COMPTON
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS – FINANCIAL

STATEMENTS
Finding No. Level Title Status of Corrective Action Repeat Finding No.2020-005 SD Land Held for Resale AppraisalsResolved for FY 2021. Comparable sales and appraisals were obtained.2020-006 MW Internal AuditsIn progress. The internal audit policy was received and filed by the City Council. The internal audit division is still being staffed. 2021-0152020-007 MW Staffing In progress. Staffing is still ongoing. 2021-0142019-009 MW Bank ReconciliationsIn progress. Bank reconciliation policy was received and filed by the City Council in March 2022. Bank reconciliations through June 2023 have been completed. 2021-0132019-010 MW Cash - Negative BalancesIn progress. Some of the negative balances have been removed as of June 30, 2021. A cost allocation plan and fiscal sustainability plan is being conducted to eventually remove the negative cash in the general fund. The City will adopt a grants policy that will allow grant funds to drawdown reimbursements on a timely manner. 2021-0092019-011 SDAccounts Receivable Roll Forward BalancesResolved for FY 2021. A general accounting policy was received and filed by the City Council in March 2022. Procedures are in place to perform the reconciliations and staff are fully trained.2019-012 MW Notes and Loans ReceivableResolved for FY 2021. A general accounting policy was received and filed by the City Council in March 2022. Procedures are in place to perform the reconciliations and staff are fully trained.2019-013 SD Utilities Allowance for Doubtful AccountsResolved for FY 2021. A general accounting policy was received and filed by the City Council in March 2022. Procedures are in place to perform the reconciliations and staff are fully trained.2019-014 SDPrepaid Expenses and Roll Forward BalancesResolved for FY 2021. A general accounting policy was received and filed by the City Council in March 2022. Procedures are in place to perform the reconciliations and staff are fully trained.2019-015 MW Capital AssetsResolved for FY 2021. The City conducted a full inventory and valuation of capital assets.

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -35-

CITY OF COMPTON
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS – FINANCIAL

STATEMENTS (CONTINUED)
Finding No. Level Title Status of Corrective Action Repeat Finding No.2019-016 MW Land Held for ResaleResolved in 2021. Comparable sales and appraisals were obtained.2019-017 SD Interfund BalancesResolved for FY 2021. Interfund balances were reviewed in detail in FY 2021. The policies and procedures related to interfund balances are included in the grants policy that was received and filed by the City Council in March 2022.2019-018 MWInterfund Balances - Advances to/from RepaymentResolved for FY 2021. Interfund balances were reviewed in detail in FY 2021. The policies and procedures related to interfund balances are included in the grants policy that was received and filed by the City Council in March 2022. A repayment plan was approved by the City Council.2019-019 SD Accrued InterestResolved for FY 2021. A general accounting policy was received and filed by the City Council in March 2022. Procedures are in place to perform the reconciliations and staff are fully trained.2019-020 MW Accrued LiabilitiesResolved for FY 2021. A general accounting policy was received and filed by the City Council in March 2022. Procedures are in place to perform the reconciliations and staff are fully trained.2019-021 SD Accrued Wages PayableResolved for FY 2021. A general accounting policy was received and filed by the City Council in March 2022. Procedures are in place to perform the reconciliations and staff are fully trained.2019-022 MW Deferred Grant Revenues Resolved for FY 20212019-023 SD Fund Balance ClassificationResolved for FY 2021. The recommendations were included in the general accounting policies received and filed by the City Council in March 2022. 2019-024 MW Bond ComplianceIn progress. Bond covenant testing was performed in FY 2021. 2021-017

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -36-

CITY OF COMPTON
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS – FINANCIAL

STATEMENTS (CONTINUED)
Finding No. Level Title Status of Corrective Action Repeat Finding No.2019-025 MW Negative Fund BalancesIn progress. The City is taking several step to resolve this finding: A cost allocation plan will be completed to properly allocate costs to various funds; a fee study is underway; a fiscal sustainability plan was also initiated. In the meantime, the City has resolved some of the negative fund balances with only a few funds remaining with negative fund balances. 2021-0092019-026A MW Payroll AllocationsIn progress. A payroll policy was submitted to the City Council and City Management for implementation. 2019-026B MW Human ResourcesIn progress. A payroll policy was submitted to the City Council and City Management for implementation. 2019-027 SDSelf-Insurance Liabilities and Expenditures/ExpensesIn progress pending policy adoption by City Manager.2019-028 SDCash Disbursements - Payments Based on QuotesNot observed in 2021. The accounts payable policy was submitted to City Council for receive and file and is ready for implementation.2019-029 SD, NC Procurement PolicyIn progress. The purchasing policy was submitted to the City Council for receive and file. It is awaiting approval by the City Manager to be included in the Standard Operating Manual of the City. 2021-0122019-030 SD, NCProcurement - Requests for Proposal (RFP) DocumentationIn progress. The purchasing policy was submitted to the City Council for receive and file. It is awaiting approval by the City Manager to be included in the Standard Operating Manual of the City. 2021-0122019-031 SD Journal Entries Resolved for FY 20212019-032 MW Lack of Budgeted Fund BalancesFully implemented for FY 2023 and FY 2024.

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -37-

CITY OF COMPTON
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS – FINANCIAL

STATEMENTS (CONTINUED)
Finding No. Level Title Status of Corrective Action Repeat Finding No.2019-033 MWTurnover and Lack of Consistent LeadershipIn progress. The City has filled some of the executive positions at the City. A consultant will be engaged to provide succession planning services. 2021-0162019-034 MW Information Technology (IT) Controls In progress 2021-0102018-013 MW Bank ReconciliationsIn progress. Bank reconciliation policy was received and filed by the City Council in March 2022. Bank reconciliations through June 2023 have been completed. 2021-0132018-014 MW Cash - Negative BalancesIn progress. Some of the negative balances have been removed as of June 30, 2021. A cost allocation plan and fiscal sustainability plan is being conducted to eventually remove the negative cash in the general fund. The City will adopt a grants policy that will allow grant funds to drawdown reimbursements on a timely manner. 2021-0092018-015 SDAccounts Receivable Roll Forward Balances Resolved for FY 20212018-016 MW Notes and Loans Receivable Resolved for FY 20212018-017 MW First Time Home Buyer Loan Program Resolved for FY 20202018-018 MW Grants Receivable Resolved for FY 20202018-019 SD Utilities Allowance for Doubtful Accounts Resolved for FY 20212018-020 SDPrepaid Expenses and Roll Forward Balances Resolved for FY 20212018-021 SD Interfund Balances Resolved for FY 20212018-022 MWInterfund Balances - Advances to/from Repayment Resolved for FY 20212018-023 MW Capital Assets Resolved for FY 20212018-024 SD Land Held for Resale Resolved for FY 20212018-025 SDAccounts Payable Supporting Documentation Resolved for FY 20202018-026 SD Accrued Interest Resolved for FY 20212018-027 MW Accrued Payroll Resolved for FY 20212018-028 MW Accrued Liabilities Resolved for FY 20212018-029 SD Retentions Payable Resolved for FY 20212018-030 SD Deposits Resolved for FY 20212018-031 SD Special Revenue Funds not Budgeted Resolved for FY 20212018-032 Resolved for FY 20192018-033 SD Deferred Grant Revenues Resolved for FY 20212018-034 SD Bonds Payable Resolved for FY 2021

(MW) – Material Weakness (SD) – Significant Deficiency (NC) – Noncompliance -38-

CITY OF COMPTON
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS – FINANCIAL

STATEMENTS (CONTINUED)
Finding No. Level Title Status of Corrective Action Repeat Finding No.2018-035 SD Bond Refunding Resolved for FY 20212018-036 MW Bond ComplianceIn progress. Bond covenant testing was performed in FY 2021. 2021-0172018-037 MW Fund Balance - Negative Fund BalancesIn progress. The City is taking several step to resolve this finding: A cost allocation plan will be completed to properly allocate costs to various funds; a fee study is underway; a fiscal sustainability plan was also adopted. In the meantime, the City has resolved some of the negative fund balances with only a few funds remaining with negative fund balances. 2021-0092018-038 MWHuman Resources - Employee CompensationIn progress. A consultant was hired by the City Manager to prepare HR policies and procedures. 2018-039 MWManagement Oversight and Control - Payroll Segregation of DutiesIn progress. A consultant was hired by the City Manager to prepare HR policies and procedures. 2018-040 MW Information Technology (IT) Controls In progress 2021-010 Findings for FYE 2017 and prior have been omitted in this report.

CITY OF COMPTON, CALIFORNIA
Management’s Discussion and Analysis (UNAUDITED)
June 30, 2021
1 UNAUDITED

As management of the City of Compton, California (City) we offer readers of the City’s financial statements this narrative overview and analysis of the financial activities of the City for fiscal year ended June 30, 2021. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal, which can be found in the Introductory Section of this report.

A) FINANCIAL HIGHLIGHTS
 The assets and the deferred outflows of resources of the City exceeded its liabilities and deferred inflows of resources at the close of the Fiscal Year 2020-2021 by approximately $5.1 million (net position), which is approximately $105.1 million higher than the previous year's net position. This is due primarily to a City- wide valuation of capital assets and an increase in tax revenue, including property taxes and sales taxes.

While franchise tax and special assessment tax revenue remained mostly flat relative to fiscal year 2019-20, property tax and sales tax revenue improved relative to the prior year by approximately $12.0 million and $7.1 million, respectively. The unrestricted portion of net position as of June 30, 2021 increased by approximately $21.4 million to ($256,963,174) accumulating more resources that may be used to meet the City’s ongoing obligations to citizens and creditors.
 As of the close of the current fiscal year, the City’s Governmental Funds (e.g. General Fund, Capital Projects Funds, Special Revenue Funds, etc.) reported combined fund balances of approximately $169.6 million, an increase of approximately $59.1 million from the prior year. Of this amount, $172.5 million, or approximately 102.1%, of total fund balances are reported as either “Nonspendable” ($10.5 million), "Assigned" ($140 thousand), “Committed” ($3.4 million), or “Restricted” ($162.2 million) fund balances, leaving negative $(6.7 million) available as Unassigned for use at the City’s discretion. This increase in the City's governmental funds combined fund balances reported was primarily driven by increases in tax revenue (by approximately $11 million) and an influx of bond proceeds (by approximately $41.8 million) from the 2021 Sales Tax Revenue Bonds issued in March 2021.
 The City’s net capital assets (land, buildings, equipment, infrastructure, less accumulated depreciation) were at $208.8 million as of June 30, 2021, increasing by $83.7 million over the previous year due mainly to a valuation of capital assets that the City had been performed which recognized prior unrecorded capital assets ($73.4 million), as well as additions and improvements during Fiscal Year 2020-2021 for streets and pavement ($14.5 million), and for Gonzales Park solar arrays ($637.5 thousand).  The City’s net long-term liabilities increased by $67.3 million to $466.2 million, primarily as the result of issued bonds of $41 million during March of 2021 along with Pension and OPEB liability increases of $8.3 million and of $20.0 million respectively. Offsets to these increases occurred from principal payments made by the City on exiting bonds payable, notes and loans payable.  The City’s financial position was elevated during Fiscal Year 2020-2021 with the removal of two “qualified” opinions from the City’s Single Audit and audited financial statements. Prior to Fiscal Year 2020-2021, the City maintained a “qualified” audit opinion on its valuation of Capital Assets, as well as on the City’s reporting of Housing Authority Equity balances. During Fiscal Year 2020-2021 City staff performed the necessary research to rectify the valuations and reporting of these assets and liabilities. This follows the research done during the prior Fiscal Year 2019-2020 which saw the removal of two “qualified” audit opinions regarding the City’s recorded balances of Unearned Revenue and Loan Receivable. As of the Fiscal Year ended June 30, 2021 only one “qualified” opinion has remained for which research has begun for an anticipated rectification within the next audit report.  Property Taxes increased by approximately $12.0 Million, 24.6%, primarily as a result of an increase in assessed valuation from new non-residential construction (a 7.54% increase as shown in the Proposition 111 Analysis of the Office of the Assessor of Los Angeles County).  Sales Taxes increased by approximately $7.1 Million or 33%, as a result of increased spending volume.  Utility User Taxes increased by approximately $1.1 million, 10.2%, as a result of increased residential utility usage incurred from shut down orders in Los Angeles County during the Covid-19 pandemic.  Casino Tax Revenue significantly declined by approximately $548,000 or 36%, as a result of shut-down orders in Los Angeles County during the Covid-19 pandemic.

CITY OF COMPTON, CALIFORNIA
Management’s Discussion and Analysis (UNAUDITED)
June 30, 2021
2 UNAUDITED

B) OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis is intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements comprise three components: government-wide financial statements, fund financial statements and notes to basic financial statements. This report also contains supplementary information in addition to the basic financial statements.

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, deferred outflows of resources, liabilities, deferred inflows of resources, with the difference between the four 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, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave). Both of the government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (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, public works, environmental and human services and debt service. The business-type activities of the City include operations of its Water, Sewer and Solid Waste utilities.

The government-wide financial statements include not only the City itself (known as the primary government), but also activities of three legally separate component units: the Successor Agency of the City of Compton, the Compton Public Finance Authority, and the Compton Housing Authority. Because the City Council acts as (or appoints) the governing board for each of these component units and because they function as part of the City government, their activities are blended with those of the primary government.

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 two categories: governmental funds and proprietary 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 on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating the City’s near-term financial 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 governmentwide financial statements. By doing so, readers may better understand the long-term impact of the City’s near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.

The City maintains 141 individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures and changes in fund balances for the

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General Fund, the Retirement Fund, and the Compton Housing Successor Capital Projects Fund, each of which are considered to be major funds. Data from the other 138 governmental 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 in the Additional Financial Information section of this report.

The City adopts an annual appropriated budget for its General Fund, each of its special revenue funds, its debt service fund, and its capital projects fund. A budgetary comparison statement is provided for each of the City’s major governmental funds or groups of funds to demonstrate compliance with this budget. The budgetary comparison statement for the General Fund and the Retirement Fund is located in the basic financial statements; the budgetary comparison statements for the Compton Housing Successor Capital Projects Fund and the non-major governmental funds are presented in the Additional Financial Information section of this report.

The basic governmental fund financial statements can be found on pages 8-11 of this report.

Proprietary Funds
The City maintains two different types of proprietary funds. Enterprise funds are used to report the same functions presented as business-type activities in the governmentwide financial statements. The City uses Enterprise Funds to account for its Water, Sewer and Solid Waste utilities. Internal Service Funds are an accounting device used to accumulate and allocate costs internally among the City’s various functions. The City uses internal service funds to account for the following activities:
 Equipment Usage and Rental
 Central Duplication, and
 Self-Insurance
Because these services predominately benefit governmental rather than business-type functions, they have been included within governmental activities in the governmentwide financial statements. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for the Water, Sewer, Solid Waste, each of which is considered a major fund of the City. Conversely, the internal service funds are combined into a single, aggregated presentation in the proprietary fund financial statements. Individual fund data for the internal service funds is provided in the form of combining statements in the Additional Financial Information section of this report. The basic proprietary fund financial statements can be found starting at page 12 of this report.

Notes to the Basic Financial Statements
The notes to the basic financial statements provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the basic financial statements can be found on pages 18 - 72 of this report.

Other Information
In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning the City’s progress in funding its obligation to provide pension benefits to its employees. Required supplementary information can be found on page 73 of this report. The combining statements referred to earlier in connection with nonmajor governmental funds and internal service funds, together with information on the Retirement Fund budget comparison, are presented immediately following the required supplementary information on pensions and other postemployment benefits.

C) GOVERNMENT-WIDE FINANCIAL ANALYSIS
As noted earlier, net position may serve over time as a useful indicator of the City’s financial position. In the case of the City, assets exceeded liabilities by $5.1 million at the close of Fiscal Year 2020-2021.

A large portion of the City’s net position, $86.7 million reflects its net investment in capital assets (e.g., land, buildings, utility and general government infrastructure, machinery and equipment, etc.), less any related debt used to acquire those assets that is still outstanding. The City uses these capital assets to provide services to citizens; consequently,

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these assets are not available for future spending. Although the City’s investment in its 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.

Another large portion of the City’s net position, $175.3 million is restricted and, as noted earlier, is restricted to meet the City’s ongoing obligations to creditors, grantors, and special-levy tax payers. A negative portion of the City’s net position, ($257.0 million) represents a deficit in resources that need to be set aside to cover long term liabilities. At the end of the fiscal year, due to the City’s financial position and despite the impacts of the COVID-19 pandemic on the City's revenues, the City is able to report improvements in balances in net position for both its governmental activities as well as its business activities.

The City’s governmental current assets increased by $42.8 million (primarily due to an increase in tax revenues as well as from the City’s receipt of grant proceeds from the American Rescue Plan) to $167.4 million, while current assets for business-type activities increased by $5.2 million to $34.5 million. Net capital assets overall grew to $208.8 202120202021202020212020$ 167,418 124,620 34,544 29,369 201,962 153,99031,538 (9,002) 29,776 30,220 61,314 21,218164,048 90,093 44,703 34,911 208,751 125,004363,004205,711109,02494,500472,028300,21143,70334,6783,3351,70347,03836,38135,504 20,392 8,294 7,082 43,798 27,474388,533 327,212 77,710 71,757 466,244 398,969424,037347,60486,00478,839510,041426,4433,6939,7052334843,92610,18886,719 50,582 - - 86,719 50,582162,198 117,334 13,146 10,412 175,344 127,746(269,939) (284,835) 12,9766,468(256,963) (278,367) $ (21,021) (116,919) 26,12116,8805,100(100,039) Restricted Unrestricted Total net positionGovernmental ActivitiesLong-term liabilities, net of current portion Total liabilitiesDeferred inflows of resourcesNET POSITIONCapital assets Total assetsDeferred outflows of resourcesLIABILITIESCurrent liabilities Net investment in capital assetsASSETSCurrent assetsNoncurrent AssetsBusiness-type ActivitiesTotalCity of Compton, California (000's)As of June 30, 2021 and 2020

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million at June 30, 2021. Growth in capital assets in governmental activities was due to a capital assets valuation that the City performed as well as from increases in buildings, infrastructure, and machinery and equipment, while growth in business-type activities was primarily due to the performance of the capital assets valuation which included the recording of past asset acquisitions. Long-term liabilities increased by $67.3 million to $466.2 million primarily as a result of the 2021 Sales Tax Revenue bonds issued in March of 2021 for $41 million, as well as a result of the increase to the total of Pension and OPEB liabilities of approximately $8.3 million and $20.0 million, respectively.

202120202021202020212020Revenues Program revenues Charges for services $14,399 15,317 28,437 29,485 42,835 44,801 Op. grants & cont.15,579 11,139 - - 15,579 11,139 Cap. Grants & cont.8,035 10,258 - - 8,035 10,258General RevenuesTaxes Property60,769 48,768 - - 60,769 48,768 Sales28,829 21,755 - - 28,829 21,755 Utility user taxes12,273 11,140 - - 12,273 11,140 Franchise Taxes2,737 2,565 - - 2,737 2,565 Special Assessments4,250 4,241 - - 4,250 4,241 Transient occupancy taxes68 105 - - 68 105 Real property transfer taxes237 242 - - 237 242Intergovernmental not restricted to specific programs815 - - - 815 - Investment earnings1,334 1,558 50 124 1,385 1,682 Other Income774 3,184 - - 774 3,184Transfer in from fiduciary fund1,748 - - - 1,748 - Total Revenues113,834130,27228,48729,608180,335159,880Expenses General government22,026 19,586 - - 22,026 19,586 Public Safety45,336 47,886 - - 45,336 47,886 Public Works13,504 9,551 - - 13,504 9,551 Management Services18,543 26,366 - - 18,543 26,366 Environmental and Human Services15,842 15,284 - - 15,842 15,284 Interest on long-term debt1,835 1,578 - - 1,835 1,578 Water- - 18,682 9,510 18,682 9,510 Rubbish- - 6,161 9,005 6,161 9,005 Sewer- - 2,2411,9342,2411,934 Total Expenses117,086 120,250 27,084 20,448 144,170 140,698 Prior Year Adjustment55,461 (5,900) 13,513 13,404 68,974 7,505 Transfers5,675 5,651 (5,675) (5,651) - - Change in Net Position40,437 15,673 (4,272) 3,510 36,165 19,182Net Position, July 1 (as restated)(61,458) (132,592) 30,393 13,371 (31,065) (119,221) Net position, June 30 $(21,022) (116,919) 26,12116,8805,100(100,039) Governmental ActivitiesBusiness-type ActivitiesTotalCity of Compton, Change in Net Position (000's)For the Years Ended June 30, 2021 and 2020

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Total revenues increased from $159.9 million in Fiscal Year 2019-2020 to $180.3 million in Fiscal Year 2020-2021 or, an increase of $20.5 million or 12.8%. The City experienced an increase of 22.9% in tax revenues or $20.3 million.

While Franchise Tax, and Special Assessment Taxes saw slight increases of $181 thousand (6.7% from $2.6 million to $2.7 million), and $10 thousand (0.2% from $4.24 million to $4.25 million) respectively, certain tax revenues were less affected by the Covid-19 pandemic. Sales Tax due to an increase in spending trends, recorded a $12.0 million increase (32.5% from $21.7 million to $28.8 million). Similarly, Property Tax increased due to appreciation in assessed property values by $20.3 million (24.6% from $48.8 million to $60.7 million). The City also experienced a decrease of $2.0 million or 4.4% in revenue from charges for services provided due to reduced demand in services offered during the pandemic closures. Total expenses increased by $3.5 million from $140.7 million in fiscal year 2019-2020 to $144.2 million in fiscal year 2020-2021 or 2.0%.

Governmental Activities
The total growth in net position for the City was $105.1 million for the fiscal year ended June 30, 2021 compared to $13.2 million in fiscal year ended June 30, 2020, a $91.9 million increase. This was mainly due to the performance of the City-wide capital asset valuation and increases in tax revenue. Total general revenues and transfers increased $20.5 million compared to the prior year primarily due to the increase in tax revenue, The City of Compton has three major tax sources, sales, property, and utility users tax. While these sources generally provide for a diversified and stable tax base, which reduces reliance on any one source, this year the City did see significant increases in both sales tax and property tax, further described below.

Property Tax
Property taxes are levied based on assessed values, which grew 7.54% (as shown in the Proposition 111 Analysis of the Office of the Assessor of Los Angeles County for new non-residential growth) this past year. This reflects a real estate market in the City of Compton that continues to gain strength resulting in a $12.0 million or 24.6% increase in property tax revenues to a total of $60.8 million.

Sales Tax

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Sales tax revenue increased by approximately $7.1 million or 32.5% to $28.8 million in fiscal year 2020-2021 compared to fiscal year 2019-2020, primarily due to increased spending volume.

Utility User Taxes
Utility User tax revenue also increased in fiscal year 2020-2021 to $12.3 million, increasing $1.1 million or 10.2% from $11.1 million in prior fiscal year. For commercial, retail and certain other categories of utility user tax, the utility user tax is computed on units of utility usage. As a result, the increase in residential activities attributable to pandemic periods contributed to the increase of this revenue.

Gas Taxes

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Gas tax revenues for fiscal year 2020-2021 decreased by $16 thousand or 0.4% for a total of $3.94 million versus prior year actual receipts of $3.95 million. The decrease in revenue is primarily driven by temporary shut-down orders in Los Angeles County due to the Covid-19 pandemic.

Franchise Taxes
Franchise tax revenues for fiscal year 2020-2021 increased by approximately $172 thousand or 6.7% for a total of $2.74 million versus prior year actual receipts of $2.57 million. The increase in revenue is primarily driven by temporary increased usage of utilities due to Covid-19 shut downs.

Charges for services
Charges for Services slightly declined by approximately $918 thouand or 6.0% to approximately $14.4 million in Fiscal Year 2020-2021 due to the effect that the Covid-19 pandemic shut downs had on the demand for City services.

Investment revenues
Investment revenues also decreased by $297 thousand or 17.7% due to a decrease in interest rates and investment returns.

Expenses of Governmental Activities
The City continued its efforts to maintain effective cost controls. Governmental activities expenses during fiscal year 2020-2021 were allocated as shown in the following chart:

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Public safety expenses
Public Safety expenses decreased 5.3% to $45.3 million primarily due to a decrease in Pension expenses of approximately $2.0 million due to change in projected earnings on Pension plan investments and recognized changes in assumptions. Additionally, there were decreases in Public Safety expenditures for salaries and crossing guard costs, approximately $1.0 million. These decreases were primarily off-set by an increase of approximately $1.2 million in the City’s contract with the Los Angeles County Sherriff.

Public works expenses
Public works expenses increased 41.4% to $13.5 million primarily due increase in depreciation expenses attributed to increases in public works capital assets being valuated in the capital asset valuation study implemented in Fiscal Year 2020-2021.

Management services expenses
Management Services Expenses decreased 29.7% to $18.5 million, primarily due to a $6.3 million decrease in OPEB and pension costs due to change in projected earnings on Pension plan investments and recognized changes in OPEB and Pension assumptions. Additionally, expenses for the General Services department decreased by $1.0 million, as those expenses were budgeted under the category of Public Works during FY2020-2021, instead of in Management Services as they were budgeted in FY 2019-2020. There was additionally, an approximate $500 thousand decrease in utility costs of water and electricity used by the City.

General government expenses
General government expenses increased 12.5% from $19.5 million to $22.0 million mainly due an increase in general liability claims incurrence during FY 2020-2021.

Environmental and human services expenses

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Environmental and human services expenses increased 3.7% from $15.3 million to $15.8 million primarily due a contribution to other agencies valued at $2.9 million that was made from the Compton Housing Successor fund, primarily offset by $2.1 million decrease in Recreation expenditures.

Interest on long-term debt
Interest on long-term debt increased 16.3% to $1.8 million, with debt service payments of $2.1 million, as a result of debt-service structures.

The following chart examines the City’s governmental (i.e. non-business type) expenses over the past several years:

Governmental Expenses by Type

Business-type Activities
Business-type activities increased the City's net position by $ 9.2 million in Fiscal Year 2020-2021 to $26.1 million.

Key factors related to business-type activities include:

Total revenues for business-type activities were $1.1 million lower than the previous year primarily due to $1.8 million reduction in charges for services for the Rubbish Enterprise Fund as a result of lower demand due to the pandemic.

Total expenses in the business-type activities increased $6.6 million compared to the prior fiscal year due primarily to a $5.4 million increase in the Water Enterprise Fund from additions to OPEB cost. 020406080100120140FY 11/12 FY 12/13 FY 18/19 FY 19/20 FY 20/21MillionsGovernmental Expenses by Type*(Shown Cumulatively)General GovernmentRedevelopmentPass-through paymentsPublic SafetyPublic WorksManagement ServicesEnvironmental and Human ServicesInterest on Long=Term Debt* This data has not been presented for Fiscal Years FY 13/14 through FY 17/18 due to there not being audited financial information available for this time period.

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D) 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 focus of the City’s governmental funds is to provide information on near-term inflows and outflows and balances of spendable resources. Such information is useful in assessing the City’s financing requirements. In particular, the unrestricted fund balance may serve as a useful measure of the City’s net resources available for spending at the end of the fiscal year.

As of the end of the 2020-2021 fiscal year, the City’s governmental funds report combined ending fund balances of $169.6 million, an increase of $59.1 million over the prior year. Increases in tax and special assessment revenue for the current year provided a $10.9 million or 12.4% increase in revenues to $99.8 million. A $5.2 million or 4.7% increase in expenditures to $115.5 million was mostly due to an increase in capital outlay expenditures of $9.1 million with a combining offset primarily from an approximate $3.7 million decrease in Governmental fund expenditures due to decreases in General Government, Public Safety, Public Works, Management Services, and Environmental and Human Services (this included a wide variety of cost reduction measures that were undertaken as a result of the pandemic, such as reductions to materials, supplies, and contractual services, deferral of labor cost increases from labor negotiations, reduction of certain City services, slow hiring, position eliminations, and layoffs). The increase in capital outlay expenditures were primarily related to street and pavement projects, as well as a transfer of land in the Housing Successor Capital Projects Fund.

Fund Balance
The components of fund balance include the following line items:
a) Nonspendable fund balance - $10.5 million (inherently nonspendable) include the portion of net resources that cannot be spent because of their form, such as long-term receivables, and the portion of net resources that cannot be spent because they must be maintained intact.
b) Restricted fund balance - $162.2 million (externally enforceable limitations on use) include amounts subject to limitations imposed by creditors, grantors, contributors, or laws and regulations of other government c) Committed fund balance - $3.4 million (self-imposed limitation set in place prior to the end of the period) Limitation imposed at the highest level of decision making that requires formal action at the same level to remove. d) Assigned fund balance - $141 thousand (limitation resulting from intended use) consists of amounts that are constrained by the government's intent to be used for specific purposes, but are neither restricted nor committed. Intent should be expressed by (a) the governing body itself or (b) a body (a budget or finance committee, for example) or official to which the governing body has delegated the authority to assign amounts to be used for specific purposes.

Based on the City Charter, the City Manager is the designated official. e) Unassigned fund balance – ($6.7 million) (residual net resources) is the total fund balance in the general fund in excess of nonspendable, restricted, committed, and assigned fund balance.

The fund balance of the City's General Fund increased by $13.0 million during the current fiscal year. Revenues exceeded expenditures by approximately $15.7 million in Fiscal Year 2020-2021. Expenditures in the General Fund decreased by $4.4 million (which included a wide variety of cost reduction measures that were undertaken as a result of the pandemic, such as reductions to materials, supplies, and contractual services, deferral of labor cost increases from labor negotiations, reduction of certain City services, slow hiring, position eliminations, and layoffs).

Additionally, Transfers In for charges for internal services exceeded Transfers Out (which were primarily for debt service payment funding of $3.4 million) by approximately $859 thousand.

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The fund balance of the City's Housing Successor Capital Projects Fund increased by $859 thousand, primarily due to a reimbursement from the former CRA and current Compton Successor Agency related to a purchase of a property at Lot 14 from Prism Realty with APN #: 7318-003-077.

Perhaps the best measure of the City’s effectiveness in weathering an economic downturn and building sustained growth for the future is its ability to catch up on building fund reserves. As a rule of thumb, a city should maintain sufficient reserves to weather the worst potential emergency scenarios. In the accompanying chart, the changes in the fund balance of the City’s General Fund and the changes in total expenditures (excluding transfers out) is presented.

As this chart demonstrates, the actions taken by the City have effectively improved revenues, controlled expenditures and allowed the City to increase its reserves for future needs. As shown in the chart below, in fiscal year 2011-2012 the fund balance was approximately negative $38 million while total General Fund expenditures were $48 million.

By the end of fiscal year 2020-2021, on the other hand, the General Fund fund balance was approximately negative $3.5 million while total expenditures were $57.5 million.

Enterprise Funds

The City’s enterprise funds account for financial transactions of the City’s business-type function that primarily serve external customers. Total net position of the enterprise funds totaled $26.1 million, an increase of $9.2 million or

54.7%. The increase to total net position is the result of effective rate setting and managing available resources.

Other factors concerning the finances of these funds are as follows:
(60,000,000.00) (40,000,000.00) (20,000,000.00) - 20,000,000.00 40,000,000.00 60,000,000.00 80,000,000.00FY11/12 FY12/13 FY18/19 FY19/20 FY20/21General Fund Balance and General Fund T otal Expenditures* General Fund BalanceGeneral Fund Expenditures*This data has not been presented for FY13/14 through FY17/18 due to there not being audited financial information available for this tii me period.

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Operating revenues for the Water Enterprise increased by approximately 3.5% to $19.5 million. Residential, Commercial, Industrial, and Multi-family consumption all increased in a comparable manner compared to the consumption of the prior year. Operating expenses increased by $9.2 million, or 130.1% during Fiscal Year 2020- 2021 primarily due to an accrual of OPEB costs of $5.4 million, as well as $2.8 million recorded in Depreciation expenses which had not been determined in the prior year due to the City-wide valuation of capital assets occurring for Fiscal Year 2020-2021. Further, Materials and Supplies increased by approximately $600 thousand in the Water Enterprise Fund due to the rising cost of wholesale water purchases. After factoring in non-operating items, net position in the Water Enterprise increased by $7.8 million to $22.9 million.

Operating revenues for the Sewer Enterprise increased slightly by approximately $8 thousand or 0.3% Operating expenses increased by 43.1% or by $704 thousand primarily due to $567 thousand recorded for Depreciation expenses which had not been determined in the prior year due to the City-wide valuation of capital assets occurring for Fiscal Year 2020-2021. These resulted in an overall, net position increase of approximately $2.0 million to $4.8 million.

Operating revenues for the Solid Waste Enterprise decreased $1.7 million (21.6%) from $7.9 million in prior fiscal year to $6.2 million in current fiscal year. This decrease is due to an outsourcing of residential collection services that occurred during FY2019-2020. Operating expenses mirrored the trend and decreased $(2.8) million to $6.1 million due to reduced third party servicing company billing. Overall, the net position in the Solid Waste Enterprise Fund decreased $(65) thousand to $(1.5 million).

Internal Service Funds
The City’s internal service funds are an accounting device used to accumulate and allocate costs internally among the City’s various functions. The City uses internal service funds to account for its Equipment Rental, Central Duplication, and Self-Insurance Services provided. Because these services predominately benefit governmental rather than business-type functions, they have been included within governmental activities in the government-wide financial statements.

Factors concerning the finances of the internal service funds have already been addressed in the discussion of the City’s governmental activities.

E) BUDGETARY HIGHLIGHTS
The City adopts annual appropriated operating budgets for its governmental funds (General Fund, special revenue funds, debt service fund, and Housing Successor capital projects fund), and reports the results of operations on a budgetary comparison basis. The City also uses annual financial plans as a management tool for its enterprise and internal service funds, although the City does not report the results of these funds on a budgetary comparison basis.

When preparing its budgets, the City attempts to estimate its revenues using realistic, but conservative, methods so as to budget its expenditure appropriations and activities in a prudent manner. As a result, the City Council adopts budget adjustments during the course of the fiscal year to reflect both changed priorities and availability of additional revenues to allow for expansion of existing programs. During the course of the year, the City Council can amend the originally adopted budget to re-appropriate prior year approved projects and expenditures, increase legal and professional services, move up the timing of expenditures for capital projects, and provide additional funding for community support.

General Fund
The General Fund reflected a positive net budget variance of $16.5 million when comparing actual amounts to the final budget for the 2020-2021 fiscal year. This budget variance reflects actual revenues exceeding the final budget by $4.6 million and total actual expenditures of $11.9 million less than the final budget.

F) CAPITAL ASSET AND DEBT ADMINISTRATION

Capital Assets

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The City performed a City-wide valuation of its capital assets which was effective for Fiscal Year 2020-2021. Due to this valuation, the City recognized that prior capital asset balances needed to be adjusted and these adjustments are reflected in the various City funds that house capital assets.

The City’s investment in capital assets and CIP for its governmental and business-type activities amounts to approximately $209 million net of accumulated depreciation and construction in progress as of June 30, 2021, which is a net increase of $10.3 million (5.2%) over the restated amount of the prior year total of $198.4 million.

Capital assets, net of accumulated depreciation, for governmental activities, increased from $151.0 million at June 30, 2020 to $164.0 million at June 30, 2021; a net increase of $13.0 million or 8.6%. Capital asset additions totaled $15.5 million, and depreciation expense totaled $7.8 million. Significant additions include capital projects for streets and pavement ($14.5 million), and for Gonzales Park solar arrays ($637.5 thousand).

Capital assets, net of accumulated depreciation, for business-type activities, decreased from $47.4 million at June 30, 2020 to $44.7 million at June 30, 2021; a net decrease of $2.7 million or 5.8%. Depreciation expense totaled $2.7 million. Additional information on the City’s capital assets can be found in Note D to the basic financial statements on pages 41 of this report.

Long-term Debt
At the end of the current fiscal year, the City had total long-term bonded debt outstanding of $130.0 million, up by $92.5 million from the prior year. The increase comprises a combination of bond repayments ($6.1 million) and a new debt issuance, the 2021 Sales Tax Revenue Bonds ($41 million) transacted on March 11, 2021. The new debt was issued in connection with financing certain improvements to the City's roadways. No rating was issued on the new debt.

Other long-term obligations include pension obligations of $150.3 million, other post-employment benefits $169.5 million ($20.0 million increase is due to interest rate fluctuations), employee-compensated absences of $5.0 million, and outstanding claims of $21.9 million.
20212020 *20212020 *20212020 *Land 88,425 88,425 162 162 88,587 88,587Buildings59,40558,7513,8363,83663,24162,587Infrastructure123,917109,42970,28570,285194,202179,714Machinery and Equipment 20,001 19,607 3,379 3,379 23,380 22,986Construction in Progress6,3051,016- - 6,3051,016Accumulated Depreciation (134,005) (126,229) (32,959) (30,213) (166,964) (156,443) Total capital assets, net 164,048150,99944,70347,449 208,751198,448* restated capital asset amount as of 7/1/2020City of Compton's Capital Assets, Net of Accumulated Depreciation (000's)GovernmentalActivitiesBusiness-typeAs of June 30, 2021 and 2020ActivitiesTotal

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G) PRIOR PERIOD ADJUSTMENTS
At the end of Fiscal Year 2020-2021, the City had prior period adjustments totaling $68,973,728, an increase of $74.9 million, from negative $5,933,849 in prior period adjustments during Fiscal Year 2019-2020. The prior period adjustments during FY 2020-2021 were primarily due to the effects of the City’s capital assets valuation that was performed with effective date of FY 2020-2021. The capital assets valuation identified assets net of their related accumulated depreciation which had not been recorded in prior periods totaled $77.7 million across both Governmental Activities ($64.8 million) and Business-type activities ($12.9 million). These prior period adjustments were off-set primarily by an adjustment of negative $6.9 million in the Retirement Fund to correct for proper revenue recognition in a prior period.

H) ECONOMIC FACTORS AND NEXT YEAR’S BUDGET AND RATES

While the adopted General Fund budget for Fiscal Year 2021-22 reflected projected revenues meeting operating expenditures, the overall result was an excess of revenues over expenditures of $15.7 million when factoring in interfund transfers in and out. Transfers included a $3.4 million transfer out to the Debt Service Fund to make bond repayments for the 2008 and 2016 Lease Revenue Bonds and a $1.4 million transfer to the General Liability fund to finance ongoing claims and expenses. To address the unknowns regarding the possible economic decline related to the COVID-19 pandemic, Fiscal Year 2021-22 total revenues were forecasted conservatively at depressed amounts relative to pre-pandemic levels and additional strategies were executed for reducing the City’s expenses, such as deferral of labor cost increases during labor negotiations, reductions of City services, and salary savings from existing vacancies. The City’s cost cutting measures yielded an estimated total savings of $803 thousand in personnel costs for fiscal year 2021- 22. Despite the contraction in staffing and other cost cutting measures, the adopted Fiscal Year 2021- 22 budget provided for continuity of the robust services to the community for which Compton strives to achieve annually.

I) REQUESTS FOR INFORMATION
This financial report is designed to provide a general overview of the City’s finances for readers of the financial statements. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to Sharon Rahban Navizadeh, City Controller, City of Compton, 205 S. Willowbrook Avenue, City Controller’s Office, Compton, California 90220. Additional information, including the prior year’s audited financial statements and prior and current year budgets are available on the City’s website at https://www.comptoncity.org/departments/city-manager/budget-information. 202120202021202020212020Bonds Payable 75,757,844.00$ 36,156,102 54,230,000 56,330,000 129,987,844 92,486,102.00$ Mortgage Loan Payable427,211 815,574 - - 427,211 815,574 Notes Payable- 500,000 - - - 500,000 Installment Payment Agreement1,038,941 2,038,941 - - 1,038,941 2,038,941 Compensated Absences4,600,316 4,337,658 418,856 376,391 5,019,172 4,714,049 Claims Payable 17,883,006 18,551,000 - - 17,883,006 18,551,000 Net Pension Liability142,655,587 130,813,290 7,727,242 11,243,821 150,382,829 142,057,111 Total other - - postemployment - - benefits153,091,386 140,363,905 16,436,883 9,188,166 169,528,269 149,552,071 Total debt395,454,291.19$ 333,576,470 78,812,981 77,138,378 474,267,272 410,714,848.00$ City of Compton's Capital Assets, Net of Accumulated DepreciationAs of June 30, 2021 and 2020Activities TotalBusiness-typeActivitiesGovernmental