AVAILABILITY OF PUBLIC RECORDS:
All public record to an open session item on this agenda, which are not exempt from disclosure pursuant to the California Public Records Act, that are distributed to a majority of the legislative body will be available for public inspection at the City Clerk’s Office, City Hall located at 333 90 th Street, Daly City, CA during normal business hours, at the same time that the public records are distributed or made available to the legislative body.
CITY OF DALY CITY
Regular Meeting - CITY COUNCIL
AGENDA
Monday, February 14, 2022 - 7:00 PM
Visit Daly City’s virtual meeting website to register to attend the virtual meeting via Zoom, watch the livestream of the meeting and view the agenda:
https://bit.ly/dalycityfeb14
COVID-19 ANNOUNCEMENT - PUBLIC MEETINGS
Pursuant to Government Code section 54953(e) et seq., members of the Daly City Council and staff will participate in this meeting via a teleconference. Members of the public are encouraged to watch the meeting via Livestream (City Council Meeting Livestream) at https://bit.ly/dalycityfeb14livestream or on local Channel 27 (Comcast).
Public Participation:
There are two ways to submit public comment: (1) send written comments by 4:00 pm on meeting day and (2) join to speak at the meeting via Zoom.
To submit a comment in writing, please email [email protected] and write “Public Comment” in the subject line. In the body of the email, include the item number and/or title of the item as well as your comments. All comments received by 4:00 pm will be emailed to the City Council members prior to the meeting. Those comments received after 4:00 pm will be added to the record and shared with the City Council members following the public meeting. Comments are not read aloud into the record.
To speak at the meeting via Zoom, join at https://bit.ly/dalycityfeb14zoom. Zoom will require an email address and name. The name entered will be visible online and will be used to notify you that it is your turn to speak. You may also join by visiting https://zoom.us/join. Enter meeting ID: 881 8396 8399, then enter email address and name. The February 14, 2022 Regular City Council meeting may also be accessed via telephone by dialing +1 669 900 6833 (Local). International numbers available: https://us02web.zoom.us/u/kAibLOyym. Enter the meeting ID: 881 8396 8399, then press #.
When you would like to speak on an item during the public comment portion of the meeting, you will need to use the “raise hand” feature in Zoom. Public comment is limited to two (2) minutes maximum, and speakers may only comment once per item. You must familiarize yourself with Zoom prior to joining the meeting. The City will not be providing technical support.
If you do not wish to speak, the City requests that you watch the livestream of the meeting on the City’s virtual meeting website at https://bit.ly/dalycityfeb14livestream.
Persons with disabilities who require auxiliary aids or services in attending or participating in this meeting should call the office of the City Clerk at 991-8078 as soon as possible.
Agenda – City Council
Monday, February 14, 2022
CALL TO ORDER:
PLEDGE TO THE FLAG:
ROLL CALL:
APPROVAL OF MINUTES:
1. Regular Meeting of January 24, 2022
APPROVAL OF AGENDA:
CONSENT AGENDA
All items listed on the Consent Agenda are considered to be routine and may be approved by one roll call vote of the City Council. There shall be no separate discussion of the matters on the Consent Agenda unless requested by a member of the City Council. If discussion is required, that item will be removed from the Consent Agenda and will be considered separately at the end of the Agenda.
Communications:
2. Accept Fiscal Year 2021 Annual Comprehensive Financial Report
Resolutions:
3. Authorizing City Manager to Execute a Service Agreement with Cintas Corporation for Uniform Rental and Laundry Services
4. Approving Subdivision Improvement Agreement between the City of Daly City and Ada L.
Chan and Approval of the Parcel Map of SUB-6-19-14075
5. Setting Time and Place for a Public Hearing on Claim to Lien Property at 262 Crocker Avenue (APN 004-082-150) Set Hearing: 3/14/2022
6. Setting time and place for a public hearing to consider ordinance amending Title 15 of the Daly City Municipal Code Re: Establishing Expedited Permitting Process for Electric Vehicle Charging Stations. Set Hearing: 3/14/2022
7. Accepting Storm Drain Easement from the Junipero Serra Properties LLC for the Public Storm Drain at 2171 Junipero Serra Boulevard Parking Lot
8. Approving Premium Pay for Hourly Employees Performing Essential Work
Agenda – City Council
Monday, February 14, 2022
9. Accepting Fiscal Year 2022 Mid-Year Budget Adjustments
10. Approving Amendment to the Water Supply Agreement with San Francisco Public Utilities Commission (SFPUC)
11. Approving Minimum Purchase Transfer from Mountain View to East Palo Alto
12. Approving Time Extension for Use Permit UPR-7-19-14111 and Design Review DR-7-19- 14112 — 6098 Mission Street Mixed-Use Building
13. Approving Allocation of HOME ARP Funds for Administrative Activities
14. Approving Reclassification of HCD Supervisor to HCD Manager and Housing Coordinator to Senior Management Analyst
15. Approving Change Order for Two New Pierce Fire Engines
Check Registers:
16. Check Registers for the Month of January 2022
END OF CONSENT AGENDA
PUBLIC HEARINGS:
17. Public Hearing for General Vacation of Public Access, Ingress and Egress Easement Along Parking Lot at 2171 Junipero Serra Boulevard (APN 002-342-240) STAFF: Richard Chiu, Jr.
RECOMMENDATION: Open/Close Hearing
Adopt Resolution by Roll Call Vote
COMMUNICATIONS:
18. Authorizing the City to Implement Teleconferenced Public Meetings Pursuant to Assembly Bill 361
STAFF: Rose Zimmerman, Stephen Stolte
RECOMMENDATION: Adopt Resolution by Roll Call Vote
Agenda – City Council
Monday, February 14, 2022
COMMUNICATIONS: Continued
19. Housing Element (6th Cycle) Update – Overview of Daly City’s Regional Housing Needs Allocation (RHNA)
STAFF: Michael Van Lonkhuysen
RECOMMENDATION: Information Only
PUBLIC APPEARANCES/ORAL COMMUNICATIONS:
NOTE: Speakers are limited to two minutes, unless modified by the Mayor. The Council cannot take action on any matter raised under this item.
APPOINTMENTS: Board/Commission Membership Committee Appointments
REPORTS:
20. Council Committee
a. Council Committee Reports January 10 - February 14, 2022
21. City Council
22. Staff
ADJOURNMENT:
CITY OF DALY CITY
MINUTES – REGULAR MEETING - CITY COUNCIL
JANUARY 24, 2022
--------------------------------
Note on Public Comments: For this meeting, members of the public were encouraged to watch the meeting via livestream and speak at the meeting via Zoom, and/or submit public comments via email to the City Clerk’s Office prior to the public meeting. Persons with disabilities who require auxiliary aids or services in attending or participating in this meeting were instructed to call the office of the City Clerk at 991-8078 prior to the meeting.
Visit https://www.youtube.com/c/DalyCityVideoMeetings to view videos of the City Council meetings
The meeting was called to order by Mayor Daus -Magbual at 7:00 P.M. by video conference call pursuant to Governor Gavin Newsom’s Executive Order N-29-20.
ROLL CALL: Councilmembers Present:
Roderick Daus-Magbual, Mayor
Raymond A. Buenaventura, Vice Mayor
Pamela DiGiovanni
Juslyn C. Manalo
Glenn R. Sylvester
Staff Present:
Shawnna Maltbie, City Manager
Rose L. Zimmerman, City Attorney
K. Annette Hipona, City Clerk
PRESENTATIONS:
Pension Obligations
(Ira Summer, Senior Consultant, GovInvest)
Proclaiming January 2022 as Human Trafficking Prevention Month (Pamela Estes, Human Trafficking Program Coordinator, San Mateo County)
APPROVAL OF MINUTES:
Regular Meeting of January 10, 2022
It was moved by Councilmember Manalo, seconded by Councilmember Sylvester and carried to approve the minutes of January 10, 2022.
APPROVAL OF AGENDA:
It was moved by Mayor Daus-Magbual to approve the agenda.
CONSENT AGENDA:
It was moved by Councilmember DiGiovanni, seconded by Councilmember Sylvester and carried to approve the consent agenda.
CITY OF DALY CITY
MINUTES – REGULAR MEETING - CITY COUNCIL
JANUARY 24, 2022
2 Resolutions:
Acknowledging Compliance with State Mandated Fire Code Inspections
Resolution 22- 4, Acknowledging North County Fire Authority Regarding The Inspection Of Certain Occupancies Required To Perform Annual Inspections In Such Occupancies Pursuant To Sections 13146.2 And 13146.3 Of The California Health And Safety Code
Amending Traffic Regulations
Resolution 22-5, Establishing Traffic Regulations
Accepting the Subdivision Improvements for Minor Subdivision SUB-7-18-13562 (127 Werner Avenue Subdivision)
Resolution 22-6, Accepting Subdivision Improvements For Minor Subdivision (SUB-7-18-13562) – 127 Werner Avenue Subdivision
Authorizing Agreement with Looking Point for Pure Storage Services
Resolution 22-7, Authorizing Execution Of A Three-Year Agreement With Looking Point For Pure Storage Services
Setting Time and Place for a Public Hearing for General Vacation of Public Access, Ingress and Egress Easement, and to Initiate Advertisement in Newspaper and Posting of Notices along parking lot at 2171 Junipero Serra Boulevard
Resolution 22- 8, Setting Time And Place Of Public Hearing For General Vacation Of Public Access, Ingress And Egress Easement
Check Registers
Check Registers for the Month of December 2021
END OF CONSENT AGENDA
AWARD/REJECTION OF BIDS/CONTRACTS:
Award a Purchase Contract for One (1) Caterpillar Model 906M Compact Wheel Loader
Assistant to the Director of Public Works Jeff Fornesi provided information on the critical use of the construction equipment and recommended a purchase order with Peterson CAT in the amount of $117,877.45. Mr. Fornesi addressed a question on which City fund(s) will be utilized for the purchase.
It was moved by Council member Manalo, seconded by Councilmember DiGiovanni and carried by unanimous roll call vote to adopt the following resolution.
CITY OF DALY CITY
MINUTES – REGULAR MEETING - CITY COUNCIL
JANUARY 24, 2022
3 Resolution 22-9, Award Awarding A Purchase Contract For One Caterpillar Model 906M Compact Wheel Loader
PUBLIC APPEARANCES/ORAL COMMUNICATIONS:
Call-In User, “the Public,” voiced displeasure at first amendments rights being violated when their call was cut off during the last meeting. The Public requested funds be used for mental wellness,
information on the Veteran’s Day Event, a space for a community garden, a center for human trafficking victims and noted the amount of housing units available in the City.
Call-In User, Dave, requested public comments be taken at the beginning of the meeting and expressed concern with “the Public’s” comment being cut off.
REPORTS:
Council Committee Meetings: December 13, 2021 – January 10, 2022
Bay Area Water Supply & Conservation Agency (BAWSCA) (Manalo) Special Meeting: Omicron Variant (w/ San Mateo County Health) (Daus-Magbual/DiGiovanni) Peninsula Clean Energy (PCE) (Daus-Magbual/)
San Mateo Operational Area Office Of Emergency Services (Sylvester)
City Council
Councilmember DiGiovanni reported attendance at the California Nurses Association’s virtual conference, relaying information about the continuing issue of understaffing at hospitals and the steps needed to negotiate a fair contract for nurses at Seton Hospital. Councilmember DiGiovanni acknowledged the recent retirement of Police Chief Patrick Hensley, commending his career accomplishments and thanking him for his 27 years of service in law enforcement.
Councilmember Manalo was appointed to the League of Cities/CalCities Board and expressed her pleasure in being able to represent the City on the board. Councilmember Manalo thanked City staff for all their work as public servants, particularly during the recent surge in COVID cases due to the Omicron variant.
Councilmember Sylvester provided information on Tesla’s plans later in the year to update their charging docks which will be able to charge non-Tesla EVs. Councilmember Sylvester expressed appreciation for Police Chief Patrick Hensley and the work of police officers to protect the community.
Councilmember Sylvester commended Chief Hensley for his 27 years of service to the City and his work as head of the Police Department. Councilmember Sylvester spoke about issues of transparency, open communications with the community, and the Ferguson Effect with regard to law enforcement.
Staff
City Manager Shawnna Maltbie congratulated Chief Hensley on his retirement.
CITY OF DALY CITY
MINUTES – REGULAR MEETING - CITY COUNCIL
JANUARY 24, 2022
4 ADJOURNMENT:
Mayor Daus-Magbual adjourned the meeting at 8:40 PM in memory of Raymond Allen, Tyler Lenehan, Jason Rivera, Arnold Agustin and Francisco Cabrera.
Approved as submitted, this 14th
City Clerk
day of February , 2022.
Mayor
City Council Meeting Agenda ReportItem #
Meeting Date: February 14, 2022
Subject: Presentation of Fiscal Year 2021 Annual Comprehensive Financial Report Recommended Action
Acceptance by motion of the Fiscal Year 2021 Annual Comprehensive Financial Report.
Background
The financial records of the City of Daly City are subject to an annual independent audit, which is performed by Maze & Associates. The audit is performed in conformance with generally accepted auditing standards in the United States and includes a comprehensive review of the financial records and the internal control procedures in place which safeguard the City’s assets.
Discussion
The Independent Auditor’s Report contained in the Annual Comprehensive Financial Report indicates that the financial statements present fairly, in all material respects, the financial position of the City as of June 30, 2021. This opinion is considered “clean” or “unmodified”, which means that the financial records reflect appropriately the financial activity of Fiscal Year 2021.
The Annual Comprehensive Financial Report contains the financial activity of all of the City’s funds and account groups. It is presented in a manner designed to fairly set forth the financial position and results of operations of the City as measured by the financial activity of various funds. All disclosures necessary to enable the reader to gain maximum understanding of the City's financial activity are included.
Each year the Annual Comprehensive Financial Report is submitted to the Government Finance Officers Association award program for the Certificate of Achievement for Excellence in Financial Reporting. Daly City received the award for the prior Fiscal Year 2020 and staff anticipates that the City will be successful in attaining the award for Fiscal Year 2021.
Summary/Conclusion
Staff recommends acceptance of the Fiscal Year 2021 Annual Comprehensive Financial Report. Staff is available to provide any additional information desired by the Mayor or Councilmembers.
Respectfully submitted,
Timothy J Nevin
Director of Finance and
Administrative Services
Attachment: Fiscal Year 2021 Annual Comprehensive Financial Report
City of Daly City
California
Annual Comprehensive Financial Report
For the Fiscal Year Ended June 30, 2021
CITY OF DALY CITY, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED
JUNE 30, 2021
Prepared by
DEPARTMENT OF FINANCE
AND
ADMINISTRATIVE SERVICES
Tim Nevin
Director
CITY OF DALY CITY
ANNUAL COMPREHENSIVE FINANCIAL REPORT
TABLE OF CONTENTS
I INTRODUCTORY SECTION
Page
Letter of Transmittal
................................................................................................................................. v Organization Structure .............................................................................................................................. xvi City Council and Administration and Department Heads ....................................................................... xvii
II FINANCIAL SECTION
Independent Auditor’s Report .................................................................................................................. 1 Management’s Discussion and Analysis ................................................................................................. 5 Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Position ........................................................................................................ 18 Statement of Activities ..................................................................................................... ........ 19 Fund Financial Statements:
Governmental Funds:
Balance Sheet ........................................................................................................................ 22 Reconciliation of the Governmental Funds Balance Sheet with the Statement of Net Position ................................................................................................ 23 Statement of Revenues, Expenditures, and Changes in Fund Balances .............................. 24 Reconciliation of the Net Change in Fund Balances - Total Governmental Funds with the Statement of Activities ........................................................................... 25 i
CITY OF DALY CITY
ANNUAL COMPREHENSIVE FINANCIAL REPORT
TABLE OF CONTENTS
Page
Statements of Revenues, Expenditures, an d Changes in Fund Balance – Budget and Actual:
Ge neral Fund ............................................................................................................................ 26
Gas Tax Special Revenue Fund ......................................................................................... 28
Grants Special Revenue Fund ............................................................................................ 29
Proprietary Funds:
Statement of Net Position ................................................................................................. 30
Statement of Revenues, Expenses and Changes in Fund Net Position ............................ 31
Statement of Cash Flows .................................................................................................. 32
Fiduciary Funds:
Statement of Fiduciary Net Position ..................................................................................34
Statement of Changes in Fiduciary Net Position ...............................................................35
Notes to Basic Financial Statements .......................................................................................... 37
Required Supplementary Information:
Schedule of Changes in the Net Pension Liability and Related Ratios – Pension Plans ........... 78
Schedule of Contributions - Pension Plans ................................................................................ 80
Schedule of Changes in the Net OPEB Liability and Related Ratios ........................................ 81
Schedule of Contributions – Other Post-Employment Benefits Plan. ....................................... 82
Supplemental Information:
General Fund:
Combining Fund Balance Sheet .......................................................................................... 84
Combining Fund Schedule of Revenues, Expenditures and Changes in Fund Balance ..... 85 ii
CITY OF DALY CITY
ANNUAL COMPREHENSIVE FINANCIAL REPORT
TABLE OF CONTENTS
Page
Major Governmental Funds Other than General Fund and Special Revenue Funds:
Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual:
Capital Projects Fund ....................................................................................................... 88 Nonmajor Governmental Funds:
Combining Balance Sheet ................................................................................................... 90 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances ............................................................................................................. 91 Combining Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual ........................................................................... 92 Nonmajor Enterprise Funds:
Combining Statement of Fund Net Position ............................................................................. 96 Combining Statement of Revenues, Expenses and
Changes in Fund Net Position ............................................................................................. 97 Combining Statement of Cash Flows ....................................................................................... 98 Internal Service Funds:
Combining Statement of Net Position ............................................................................... 100 Combining Statement of Revenues, Expenses and Changes in Fund Net Position .......... 102 Combining Statement of Cash Flows ................................................................................ 104 Custodial Funds:
Combining Statement of Net Position .............................................................................. 108 Combining Statement of Changes in Net Position ........................................................... 109 iii
CITY OF DALY CITY
ANNUAL COMPREHENSIVE FINANCIAL REPORT
TABLE OF CONTENTS
Page
III STATISTICAL SECTION
Net Position by Component - Last Ten Fiscal Years .......................................................................... 113
Changes in Net Position - Last Ten Fiscal Years ................................................................................ 114
Fund Balances of Governmental Funds - Last Ten Fiscal Years ........................................................ 118
Changes in Fund Balance of Governmental Funds – Last Ten Fiscal Years ..................................... 120
Assessed Value of Taxable Real Property - Last Ten Fiscal Years .................................................... 122
Direct and Overlapping Property Tax Rates - Last Ten Fiscal Years ................................................. 123
Principal Property Tax Payers – Current Year and Nine Years Ago .................................................. 124
Property Tax Levies and Collections – Last Ten Fiscal Years ........................................................... 125
Ratio of Outstanding Debt by Type – Last Ten Fiscal Years ............................................................. 126
Ratio of General Bonded Debt by Type – Last Ten Fiscal Years ....................................................... 127
Computation of Direct and Overlapping Debt .................................................................................... 128
Computation of Legal Bonded Debt Margin ....................................................................................... 129
Water Utility Fund - Number of Connections by Users as of June 30, 2020 .................................... 130
Water Utility Fund - Certificates of Participation Historical Revenues, Expenditures and Bond Coverage – Last Ten Fiscal Years .................................................................................................... 130
Demographic and Economic Statistics - Last Ten Fiscal Years ......................................................... 132
Principal Employers – Current Year and Nine Years Ago ................................................................. 133
Full-Time City Government Employees by Function – Last Ten Fiscal Years ................................. 134
Operating Indicators by Function/Program – Last Ten Fiscal Years .................................................. 136
Capital Asset Statistics by Function/Program – Last Ten Fiscal Years .............................................. 138 iv
City of Daly City
333 – 90TH STREET
DALY CITY, CALIFORNIA 94015-1895
v
Dec
ember 22, 2021
Honorable Mayor
Members of the City Council
Citizens of Daly City
We are pleased to present the Annual Comprehensive Financial Report (ACFR) of the City of Daly City for the Fiscal Year (FY) ended June 30, 2021. The goal of the independent audit is to provide reasonable assurance that the financial statements are free of material misstatements and presented in conformity with generally accepted accounting principles (GAAP).
The City has contracted w ith Maze and Associates, inde pendent Certified Public Accountants (CPAs), to perform the audit of these financial statements. The auditors have issued an “unmodified” opinion on the City of Daly City’s financial statements. This is the most favorable conclusion and is commonly known as an “unmodified” or “clean” opinion.
The auditor’s report is located at the front of the financial section of this report.
This letter of transmittal is designed to complement the Management’s Discussion and Analysis (MD&A) and should be read in c onjunction with it. The MD&A can be found immediately following the report of the independent auditors.
Management assumes full responsibility for the completeness and reliability of the information contained in this report, base d on a comprehensive framework of internal controls that are established for this purpose. Because the cost of internal controls should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements.
The independent audit is part of a broader federally mandated Single Audit, designed to meet the requirements of federal grantor agencies. The standards governing Single Audits require the independent auditor to report on the fair presentation of the financial statements as in the normal audit, but also require the independent auditor to report on the City’s internal controls and compliance with legal requirements specific to the federal grants. These reports are part of the separately issued Single Audit Report that is provided to the appropriate federal agencies.
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PROFILE OF THE CITY
The City of Daly City is one of the largest cities in San Mateo County with an estimated population of 108,599 in Januar y 2021. Daly City is an urbanized, coastal community located at the northern edge of San Mateo County, comprising approximately 7.7 square miles of substantially developed area. The City is known as the "Gateway to the Peninsula", and its area extends to the Pacific Ocean on the west, and nearly to San Francisco Bay on the East. Daly City abuts on San Bruno Mountain, a State and County Park, which features the highest peak in the area’s hilly terrain. It is strategically located and is central to major growth areas of San Francisco and San Mateo counties.
Daly City was incorporated on March 22, 1911 as a General Law City. It is governed by a council-manager form of government. Th ere are five council members who serve overlapping terms of four years, and the City Council, in tu rn, elects one of the council members to serve as Mayor each year. The City Council appoints the City Manager and the City Attorney. The City Manager is the chief executive office r. It is the City Manager's responsibility to hire department heads for each of the City functions, to propose the biennial budget, to coordinate and oversee all activities of the organization, and to implement the laws, policies, and budgets adopted by the City Council.
The City of Daly City is a full-service city providing a full range of municipal services.
These services include police, fire, library, recreation, street construction and maintenance, traffic signalization and control, engineering, code enforcement, parks operations and maintenance, general administration, planning, and community development. The City also provides water services and sanitary sewer services. Operating and capital costs for these services are maintained in enterprise funds and are funded by user rates or debt proceeds.
The ACFR includes a ll funds and accounts of the City of Daly City and its blended component units. The financial statements include the financial activities of the City, the North San Mateo County Sanita tion District, the Da ly City Public Facilities Financing Corporation, and the Daly City Housing Development Finance Agency. The financial operations of the City and the other entities included in this financial report are closely related. City Council members serve as the governing board of the District, Corporation and Agency. The City Manager also serves as the General Manager of the Sanitation District, which is included in the proprietary fund types as an enterprise fund.
The biennial budget serves as the foundation for the City’s financial planning and control.
Using the Guiding Principles and Priorities established by the City Council, departments submit budget proposals to the City Manager for review. Th e City Manager’s Proposed Budget is presented to the City Council during public budget study sessions. Changes as directed by the City Council are made and the budget is submitted for final adoption before July 1, the beginning of the next two-year budget cycle. Budgets for each of the two years covered by the biennial budget are appropriated separately. Departments are responsible for
vii
managing within the City Council appropriated budget. Budget amendments are normally necessary due to changes in economic conditions and other circumstances occurring during the first year of the biennial budget.
FACTORS AFFECTING FINANCIAL CONDITION
Economic Indicators
According to the Federal Open Market Committee, United States GDP in 2021 is expected to grow 5.9% whereas the average GDP change in 2020 was -2.3%, compared to 2.6% in 2019 and 2.3% in 2018. Due to the COVID-19 pandemic, California unemployment hit a record high of 16.4% in May 2020. Howeve r, as the State has been recovering and vaccines are more widespread, the unemploy ment rates have improved with September 2021 showing a 6.4% rate of unemployment. Jobs increased statewide at a year-over-year rate of 5% in September. The greatest risks to the forecast of the U.S. economy stem from supply chain and labor supply concerns, futu re variants of the COVID-19 virus, and concerns over inflation. Any or all of these could negatively impact exports and business investment.
In California, especially in the San Francisc o Bay Area, housing pri ces continue to be increasingly expensive and unaffordable, particularly for first time homebuyers. The U.S.
Home Price Growth on a year-over–year basi s as measured by the Case-Shiller 20-City Composite Home Price Index was back up af ter the pandemic with a 19.1% increase as of September 2021, compared with a 5.2% increase in August 2020. The housing market continues to be equally challenging for California renters, many of whom need to spend more than half of their income on rent. Housing market research suggests that continued limited supply compared to de mand is one of the major cause s of high housing costs in the coastal California region.
Local Economy and Fiscal Challenges
General Fund revenues for FY 2021 decrea sed by $5.7 million to $89.8 million. This is due both to a reduction in some taxes resu lting from the pandemic and a decrease in property taxes due to the shor tfall in In-Lieu Vehicles License Fees. General Fund expenditures increased by $8.7 million to $95.7 million, of which $5.0 million was due to salary and benefit cost increases.
Enterprise Funds
The City’s two major enterprise funds, the Water Utility Fund and Sanitation District Fund, derive revenue from water usage.
Revenues for the Water Utility Fund incr eased by $0.3 million to $23.9 million in FY 2021 mainly due to a water rate increase. Because of COVID-19, the City delayed the FY
viii
2021 water rate increase by six months, to January 1, 2021, leaving only six months of increased revenues. Expenses decreased $0.2 million to $16.7 million.
Sanitation District Fund operating revenues increased $0.8 million to $23.5 million in FY 2021, mostly due to an increase in water usage since there was no increase in the scheduled sewer rates in FY 2021. Operating expenses increased by $2.3 million to $28.3 million in FY 2021 primarily due to increases for insurance, services and supplies, and pension and OPEB costs.
LONG RANGE FINANCIAL PLANNING
The City employs a ten-year financial fore casting model to ensure accountability of service levels and to plan for future chal lenges. Long-range fina ncial planning enables the City to foresee potential budge t issues, giving the City sufficient time to respond to and analyze the long-term financial impact, as well as to take appropriate action before a problem develops. In addition, the long-range financial planning serves as a key planning tool for future budgets and decision-making.
Many of the fiscal drivers are outside the C ity’s control. This includes changes in the national and local eco nomy; federal and state legisl ation; and CalPERS actuarial assumptions and investment returns and th e resulting impact on empl oyer contribution rates. Due to the passage of Propositions 13, 218, and 26 in California, the City has no ability to institute taxes and assessments without voter approvals. For a ballot measure to be successful, there must be broad community support for the use of the tax and an outside group who will champion the tax or assessment increase.
Given the current and forecast budget challe nges, the City has implemented a multi- pronged approach to address long-term fiscal challenges and to ensure the sustainability of the City’s finances into the future.
1. Evaluate General Fund and other reserves . The City’s Reserves policy is to maintain General Fund unassigned fund bala nce equal to 17% of annual operating expenditures. Maintaining the reserve target of 17% requires cl osely monitoring the balance between revenues and expenses on an ongoing basis. The General Fund reserve provides a buffer to the City in the even t of unexpected reductions in revenues or increases in costs. The City also will be l ooking at deferred maintenance and deferred fleet replacements that have occurred si nce the 2008 economic recession and evaluate future funding levels and/or reserves to provide more consistent and sustained investment for these City assets.
2. Identify potential voter-approved taxes or assessments and other revenues. Over the next ten years, General Fund expenses will continue to in crease beyond the City’s ability to fund with current revenue sources. The City was successful with ballot measures on a cannabis business license tax ordinance and increases for transient occupancy tax
ix
and busines
s license tax in the November 2018 General Election. In addition, the Daly City voters approved Measure Q – the Daly City Local Recovery and Relief Measure – in November 2020, which adds a transaction and use tax of one-half cent to the total sales tax rate starting in April 2021. The City is al so evaluating the fee schedules of City departments to ensure cost recovery of services provided.
3. Promote economic development and business expansion. While Daly City is largely built out, there are several development opportunities on the former Daly City Redevelopment Agency parcels. If realized, they will generate new sales, property, business license and transient occupancy taxes. In FY 2021, the City continued to explore a proposed hotel and automobile sales de velopment on the former Redevelopment Agency parcels. Additionally, the City plans to update its economic development strategy to identify new opportunities for expanding and diversifying the economic base to ensure long-term fiscal sustainability.
4. Pre-fund Pension and Other Post-Employment Benefits (OPEB). A private letter ruling received from the Internal Revenue Service established that public agencies could create a separate trust to prefund pension or OPEB unfunded liabilities. In April 2017, the City Council authorized participation in the Section 115 Trust Program which allowed the City to set aside funds towards OPEB costs and help reduce the unfunded liability.
The City is also consideri ng establishing a Section 115 Trus t to pre-fund pension costs and prepare for pension increases due to changes in CalPERS actuarial assumptions and discount rates.
The Section 115 Trust Program will provide the City with an alternative to sending funds to CalPERS that will allow for greater control of the assets held in the trust and risk tolerance level for the investment. Other potential benefits include pension rate stabilization. Assets in the Trust Program can be transferred to CalPERS at the City’s discretion, which could reduce large fluctuations in employer contributions to CalPERS.
5. Complete comprehensive asset condition assessment . In 2017, the Public Works Department started this process by completing the Facilities Condition Assessment. The project included development of an automated inventory of City facilities, evaluation of existing conditions of facilities, prioritization of deficient conditions, and development of short- and long-range maintenance needs.
Then in 2020, Public Works completed the ADA Self Evaluation and Transition Plan.
City facilities and right-of-w ay were inspected for accessib ility and an inventory of needed upgrades were developed and priori tized. In that same year, Public Works completed the Parks and Open Space Master Plan. The city has over 30 parks and open space sites. Many facilities are outdated a nd underutilized. A list of improvements was developed to address short-, medium-, and long-term needs.
x
In 2020, Public Works also upda ted the City’s Pavement Ma nagement System Report.
The City’s street network is 115.25 centerline miles in lengt h and covers approximately
23.5 million square feet of pavement. The report provides a recommended schedule for maintenance and rehabilitation work needed to bring the street system to a condition that would minimize ongoing maintenance cost.
The findings from the above planning documents will be incorporated into a future Capital Improvement Plan for budgeting pur poses. Future planning studies to be performed include a Storm Drain Master Plan, Water Master Plan, Sanitary Sewer Master Plan, and Seismic Evaluation of Critical Facilities. Results of these studies will identify needed work to properly maintain the City’s infrastructure. It is imperative to have a comprehensive understanding of the infrastructu re needs of the Cit y, so that resources can be identified, and a long-term budget plan developed.
MAJOR INITIATIVES
During FY 2021, under the leadership of the City Council, several outstanding key programs and projects were successfully undertaken by the City.
Economic and Community Development
The Economic and Community Development De partment has continued to provide its regular services throughout the pandemic, while implementing a variety of new programs and policies. Aside from the typical permit issuance and building inspections, the Building Division brought forward a new or dinance that allowed building permit extensions to account for construction delays related to the pandemic and created an ordinance that will require new construction to be all-electric to carry out the goals of the City’s Climate Action Plan. Code Enforcem ent has taken on the enforcement of the Short-term Rental Ordinance that was adopt ed by the City Council last year. Planning Division and Economic Development staff have worked closely with the Police Department to establish zoning standards and an application process for retail cannabis businesses to locate in Daly City. The H ousing Division continued to administer the federal funding that was provided to help households that were affected by COVID-19 through rental assistance, f ood distribution, and mental health servic es. While the pandemic slowed development overall, many significant projects initiated construction, including faculty housing for the Jefferson High School District and the Jefferson Elementary School District, a Carvana vehicle vending facility, and two drive-through restaurants at Serramonte Shopping Center.
Library and Recreation Services
The Department of Library and Recreation Services provided modified programming and facility spaces to the Da ly City community during the COVID-19 pandemic. The Recreation Division began to offer modified afterschool support in thei r Afterschool Youth Recreation Program at five of their locations. The senior lunch program continued
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in its modified Home Delivery model and Grab & Go programs, serving 150 seniors on a weekly basis, including 750 meals per week and providing five (5) home-cooked meals with all the components to qualify for the San Mate o County Congregate Meal Program. The marketing unit continued thei r virtual recreation on all social media platforms and has been publiciz ing all programs, ac tivities, and special events to bring our community together. Special events, including the popular Trunk or Treat and movie nights, were transformed to be safely held as “drive-through” events and the Frosty Fest was celebrated virtually. Our contracted instructors provided fitness-focused virtual and outdoor classes to our Daly City community and will be transitioning to in-person in the next fiscal year. The Recreation divisi on continued to provide emergency food distribution sites by partneri ng with the Second Harvest of Silicon Valley, serving between 1,000 to 1,500 households per week.
The Library continued to provide story times and other public programs virtually, and in- person outreach was resumed where it could be safely done outdoors. Over the course of the year, the Library provided 254 modified programs with total attendance of 5,064. E- book collections and other online resources were expanded, and patrons accessed these resources 60,345 times, a 20% increase over last year. Outdoor Wi-Fi was added at the Serramonte Main Library to help bridge the digital divide. Lending of cellular hotspots also helps meet this need, a nd the Library partnered with Se nior Services to establish a large circulating collection of Chromebooks av ailable for three-week-check-out at all library locations. Physical materials rema ined in demand, and checkout was made available at curbside and via mail during most of the year. After launching curbside service in June of 2020, the Library expanded it to all locations on October 5, 2020 and then added evening and weekend hours on April 3, 2021. On May 10, 2021, the libraries opened all buildings to the public again with a modified service model, layout changes to facilitate physical distancing, and safety protocols in place.
North County Fire Authority
The North County Fire Authority (NCFA) ach ieved an overall “Customer Satisfaction” rating of 98% in the delivery of emerge ncy and non-emergency services. North County Fire also developed and implemented a NCFA Pandemic Response Plan covering preparedness, response, personnel protective equipment, illnesses, operational readiness, and continuity of operations. The NCFA provided high quality Basic Life Support and Advanced Life Support (ALS) assessment a nd interventions to emergency medical incidents utilizing our paramedic fire engine and truck companies, in which over half of total EMS calls benefited and served senior citizens. The NCFA achieved an overall average under the 6-minute response time goal for a fire engine or truck company to arrive at all emergency incidents.
Fire Prevention Services completed pre-fire engineering and plan check reviews and inspections for new construction projects, te nant improvements, alarm installations and
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suppression systems and completed a fire “cause and origin” analysis for all fire incident investigations. In addition, the NCFA completed a nnual mandated and required fire and life safety code compliance inspections, in cluding business, multi-family and permitted occupancies. North County Fire presen ted throughout the year, Basic Emergency Preparedness, Individual and Family Prep aredness seminars, as well as Community Emergency Response Team (CERT) classes th rough a virtual format due to the COVID pandemic. And last, but not least, the NCFA provided multiple fire companies and chief officers to numerous large and major wildfire incidents throughout the State of California during the worst year on record for wildfires.
Police Department
The Daly City Police Department continues to be on the forefront of policing, often a leader in community engagement, policing t actics, and policy adaptation amongst local and regional agencies. We continue to participate in local and regional task forces focused on drug, vehicle theft, and gang activity. We partnered with local agencies in a Multidisciplinary Accident Investigation Team (MAIT) to share resources during complex collision investigati ons. We remain committed to our supportive partners like the Community Overcoming Relationship Abuse (CORA), the Homeless Outreach Team (HOT), and other County entities providing invaluable services to our community.
This year the Department implemented a B ody Worn Camera program to further build community trust through transparency and we plan to implement vehicle mounted cameras as the next phase. We proactively evaluated and researched our needs to become compliant with the Racial and Iden tity Profiling Act (RIPA – AB953, 2015), a requirement for our agency beginning in 2022. Our efforts expedited our participation, and we were able to implement the software and data collection months before being required to do so.
The Daly City Police Department was the first agency in the region to train all sworn staff in Active Bystandership for Law Enforcem ent (ABLE), a Georgetown Law program geared towards preventing mistakes and mis conduct and promoting officer health and wellbeing for improved community relationships. We continue to maintain a relationship with the Stanford University SPARQ (Soc ial Psychological Answers to Real-World Questions) program, who provided communicati ons training to officers for improved citizen contacts and community relations.
One of the most exciting programs implement ed this year was a working relationship with a Mental Health C linician through StarVista, a San Mateo County non-profit organization. This is a 2-year pilot progr am implemented amongst four police agencies in San Mateo County, and in the short time the program has been underway we have seen promising success. A clinician is assigned to our department and is embedded in the field with our patrol officers. In recent weeks, the clinician has supporte d officers in dealing
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with people in crisis and those needing non-law enforcement supportive assistance. We
continue to adopt legislative updates and best practices as our organization evolves within the law enforcement industry.
Public Works Department
The Public Works Department completed several capital improvement projects and continued to provide routine se rvice to the public such as st reet sweeping, traffic signal maintenance, parks maintenance and litter and debris removal during this difficult year even with staff shortages, supply chain i ssues, and construction cost increases. In addition, Public Works instituted protective measures at all City facilities to protect City employees, residents, and business custom ers from the COVID-19 virus by installing physical barriers, touchless devices, social di stance signage, and upgr aded filtration to improve indoor air quality. Increased cleaning protocol was also implemented at all City facilities that remained operational during the pandemic.
Some completed projects by the Public Works Department include; three street resurfacing projects in the Skyline and Serramonte neighborhoods and other various streets throughout the city, new playground and energy efficient sports court/field lighting at Gellert Park, the Westlak e Library HVAC and Roof Repl acement Project, the Police Parking Lot Security Fence Project, the Doelger Senior Center Roof Replacement Project, new emergency standby generators at Fire Stations 91 and 94, retaining wall replacement project for three city parks, and replacement of the Public Works Corporation Yard fuel station canopy. Work also commenced on the Original Daly City Slurry Seal Project, the Tennis and Basketball Court Surface Rehabilitation Project, the new restroom at Gellert Park, the Central Corridor Bicycle and Pedestrian Safety Improvements Project, and the Mussel Rock 2019 Gabion Wall and Stormwater Maintenance Project.
The Public Works Department continues to seek grant funds for the City and was successful in securing additional funds for the Daly City Crosswalk Enhancement Project, the John Daly Boulevard/Skyline Boulevard Pedestrian Connection Project, the Vision Zero Community Outreach Program, and the Bayshore Shuttle.
Department of Water and Wastewater Resources
The Department of Water and Wastewater Resources (DWWR) continued to meet all public health and regulatory requirements associated with the production, treatment, and distribution of high-quality drinking water, along with the collection, treatment, re-use, and disposal of wastewater on behalf of the citizens of Daly City and the North San Mateo County Sanitation District. The Department continued to manage the critically important regional water, wastewater, and stormwater project, the Vista Grande Drainage Basin Improvement Project. DWWR is working dilig ently with our project partners, the San Francisco Public Utilities Commission, the County of San Mateo, Caltrans, the Olympic Club, and many others in anticipation of a construction start date in 2023.
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Two important drinking water projects acco mplished in 2021 were the rehabilitation of the Junipero Serra Well and the Jefferson We ll. With the severe drought continuing throughout 2021, these two local wells, along with our other active and local wells, are contributing approximately half of the drin king water to the citizens of Daly City currently. Approximately 200 million gallons of highly treated recycled water is produced and sold annually to irrigate the golf courses, playing fields and median strips in the area.
Finally, significant capital improvements made at the North San Mateo County Sanitation District Wastewater Treatment Facility incl ude the installation of a new multi-rake bar screen and solids washer in Headworks #2, c oncrete rehabilitation of Gravity Thickener #2, installation of a new sludge solids de-watering centrifuge, and construction of a new roof and HVAC system for the Administration Building.
AWARDS
The Government Finance Officers Association of the United States and Canada (GFOA) awards the Certificate of Achievement fo r Excellence in Fina ncial Reporting to governments for their Annual Comprehensive Financial Report (ACFR). The GFOA has not yet completed its review of the City’s Annual Comprehensive Financial Report for the fiscal year ended June 30, 20 20. Thus, the City does not yet know if it will receive this prestigious award for 2020, making it the City’s 34th consecutive year.
To be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized annual comprehensive financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current ACFR continues to meet the Certificate of Achievement Program’s requirements, and we are submitting it to the GFOA to determine its eligibility for another certificate.
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ACKNOWLEGEMENTS
The preparation of the Annual Comprehensive Financial Report on a timely basis was made possible by the dedicated efforts of the Accounting Division of the Department of Finance and Administrative Services. Each individual has our sincere appreciation for the professionalism, dedication and contributions made in the preparation of this report.
Credit must also be given to the Mayor, C ity Council members an d City Department Directors for their support in maintaining the highest standards of professionalism in the management of the City of Daly City’s finances.
Respectfully submitted,
Shawnna Maltbie Timothy J. Nevin
City Manager Director of Finance and
A d m i n i s t r a t i v e S e r v i c e s
CITIZENS OF DALY CITY
CITY OF DALY CITY
ORGANIZATIONAL STRUCTURE
FISCAL YEAR 2022
ECONOMIC &
COMMUNITY
DEVELOPMENT
HUMAN
RESOURCES
PLANNING
COMMISSION
RECREATION
COMMISSION
PERSONNEL
BOARD
SMALL
BUSINESS
COMMISSION
ARTS & CULTURE
COMMISSION
MOBILE HOME
RENT REVIEW
COMMISSION
LIBRARY BOARD
OF TRUSTEES
YOUTH ADVISORY
COMMITTEE
BICYCLE/PEDESTRIAN
ADVISORY
COMMITTEE
- - - - - - - - - - - ADVISORY BOARDS AND COMMISSIONS
CITY CLERK MAYOR &
COUNCIL
CITY
TREASURER
FINANCE &
ADMINISTRATIVE
SERVICES
FIRE
CITY MANAGER
LIBRARY &
RECREATION
SERVICES
WATER &
WASTEWATER
RESOURCES
POLICE PUBLIC WORKS
CITY
ATTORNEY
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CITY OF DALY CITY
CITY COUNCIL
JUNE 30, 2021
Juslyn C. Manalo, Mayor
Rod Daus-Magbual, Vice Mayor
Raymond A. Buenaventura
Pamela DiG
iovanni
Glenn R. Sylvester
K. Annette Hipona
City Clerk
Daneca Halvorson
City Treasurer
ADMINISTRATION AND DEPARTMENT HEADS
Shawnna Maltbie
Rose Zimmerman
Richard Chiu Jr.
Patrick Hensley
Timothy Nevin
Tatum Mothershead
Ron Myers
Tom Piccolotti
Natalie Sakkal
City Manager
City Attorney
Director of Public Works
Police Chief
Director of Finance and Administrative Services
Director of Economic & Community Development
Fire Chief
Director of Water & Wastewater Resources
Director of Human Resources
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INDEPENDENT AUDITOR’S REPORT
Honorable Mayor and Members of the
City Council of the City of Daly City, California
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activ ities, the business-type
activities, each major fund, and th e aggregate remaining fund information of the City of Daly City, 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 ba sic financial statements as listed in the Table of Contents.
Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fa ir presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express opini ons on these financial statements based on our audit. We conducted our audit in accordance with auditin g 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 St ates. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
In making those risk assessments, the auditor consider s internal control relevant to the City’s preparation and fair presentation of the financial statements in or der to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opin ion on the effectiveness of the City’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the r easonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
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Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activ ities, the business-type activities, each major fund, and the aggregate remaining fund information of the C ity as of June 30, 2021 and the respective changes in financial position and, where ap plicable, cash flows thereof and th e respective budgetary comparisons listed in the Table of Contents as part of the basic financial statem ents for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Change in Accounting Principles
Management adopted the provisions of Governmental Accounting Standards Board Statement No. 84, Fiduciary Activities, which became effective during the year ended June 30, 2021 and required the restatement of net position as discussed in Note 11D to the financial statements. In addition, the Statement established the new fund type, Custodial Funds, and eliminated the fund type of Agency Funds.
Management also early-adopted the provisions of Governmental Accounting St andards Board Statement No. 98 - The Annual Comprehensive Financial Report for the year ended June 30, 2021, which establishes the term annual comprehensive financial report and its acronym ACFR. That new term and acronym replace instances of comprehensive annual financial report and its acronym in generally accepted accounting principles for state and local governments.
The emphasis of these matters does not constitute a modification to our opinions.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the Un ited States of America require that Management’s Discussion and Analysis and other Required Supplementary Information as listed in the Table of Contents be presented to supplement the basic financial statements. Such inform ation, although not a part of the basic financial statements, is required by the Govern mental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic or historical context. We ha ve applied certain limited procedures to the required supplementary information in accordance with auditi ng standards generally accepted in the United States of America, which consisted of inquiries of manage ment about the methods of preparing the information and comparing the information for co nsistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basi c financial statements.
We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opi nions on the financial statements that collectively comprise the City’s basic financial statements. The Introductory Section, Supplementary Information, and Statistical Section as listed in the Table of Contents are presented for purposes of additional analysis and are not required parts of the basic financial statements. 2
The Supplementary Information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepar e 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 Supplementary Information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.
The Introductory and Statistical Sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordi ngly, we do not express an opinion or provide any assurance on them.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued ou r report dated December 21, 2021, on our consideration of the City’s internal control over financia l reporting and on our tests of its compliance with certain provisions of laws, regulat ions, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financ ial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.
Pleasant Hill, California
December 21, 2021
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MANAGEMENT’S DISCUSSION AND ANALYSIS
This narrative overview and analys is of the City of Daly City’s financial results provides an overview of the City’s financial activities for the year ended June 30, 2021.
FISCAL YEAR 2021 FINANCIAL HIGHLIGHTS
At June 30, 2021, net position totaled $142.6 million, a decrease of $3.7 million from the prior year total of $146.3 million for both Governmental and Business-Type activities. Net Position of governmental activities in Fiscal Year (FY) 2021 was $45.1 million compared to $51.6 million in FY 2020, a decrease of $6.5 million. Net Pension and OPEB Liabilities of govern mental activities incr eased by $10.7 million to $201.7 million in FY 2021 from $191.0 million in FY 2020. Net Position of business-type activities in FY 2021 was $97.4 million compared to $94.7 million in FY 2020, an increase of $2.7 million.
Net Pension and OPEB Liabilities of business-type activities increased by $2.9 million to $28.6 million in FY 2021 from $25.7 million in FY 2020.
In FY 2021, total City revenues, including program and general revenues, were $157.4 million, while total expenses were $161.2 million.
Governmental activities program revenues were $35.2 million in FY 2021 compared with $39.8 million in FY 2020. Business-type program revenues were $47.9 million in FY 2021 compared with $46.9 million in FY 2020.
Governmental activities general rev
enues were $71.3 million in FY 2021 compared with $77.1 million in FY 2020, a decrease of $5.8 million over the prior year. Part of this is a $3.3 million decrease in property taxes, largely due to the shortfall in In-Lieu Vehicle License Fees. The County expects to recover this shortfall in future fiscal years. In addition, investment earnings were much lower than in previous years, bringing down overall revenues. Business-type general revenues were $2.9 million in FY 2021, a decrease of $1.2 million over the prior year. Unrestricted net position of governmental funds changed from negative ($76.1) million in FY 2020 to negative ($87.7) million in FY 2021, primarily due to an increase of $8.9 million in the net pension liabilities and related deferred outflows/inflows of resources.
OVERVIEW OF THE ANNUAL COMPREHENSIVE FINANCIAL REPORT
This Annual Comprehensive Financial Report (ACFR) is in three sections:
1) Introductory Section containing the Tran smittal Letter and miscellaneous other information
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2) Financial Section containing the Independe nt Auditor’s Report, this Management’s Discussion and Analysis, the Basic Financial Statements, which include the Government- wide and the Fund Financial Statements, along with the Notes to these financial statements, Required Supplementary Information, and Combining Statements for Non-major Governmental Funds and Fiduciary Funds
3) Statistical Section containing financial trend data and general statistical information about the City
The Basic Financial Statements
The Basic Financial Statements are comprised of the City-wide Financial Statements and the Fund Financial Statements, including the Notes thereto. These two sets of financial statements provide two different views of the City’s financial activities and financial position.
The Government-wide Financial Statements provide a longer-term view of the City’s activities as a whole and are comprised of the Statement of Net Position and the Statement of Activities. The Statement of Net Position provides information about the financial position of the City as a whole, including all its capital assets and long-term liabilities on the full accrual basis, like that used by private corporations. Th e Statement of Activities provides information about all the City’s revenues and all its expenses, also on the full a ccrual basis, with the emphasis on measuring net revenues or expenses of each of the City’s programs. The Statement of Activities explains in detail the change in net position for the year.
All the City’s activities are grouped into governmental activ ities and business-type activities, as explained below. All the amounts in the Statement of Net Position and the Statement of Activities are separated into governmental ac tivities and business-type activ ities to provide a summary of these two types of activities of the City as a whole.
The Fund Financial Statements report the City’s operations in more detail than the government- wide statements and focus primarily on the short- term activities of the City’s General Fund and other major funds. The Fund Financial Statements measure only current revenues and expenditures and fund balances; they exclude capital assets, long-term debt, and other long-term amounts.
Major funds account for the major fi nancial activities of the City and are pr esented individually, while the activities of non-major funds are pres ented in summary, with subordinate schedules presenting the detail for each of these other funds.
The fiduciary statements provide financial information about the assets for which the City acts solely as custodian in its capacity as a fiscal agent.
The Government-Wide Financial Statements
The Statement of Net Position an d the Statement of Activities present information about the following:
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Governmental activities - All th e City’s basic services are considered to be governmental activities, including general government, public safety, public works, streets and infrastructure, culture and recreation, and economic and co mmunity development. These services are supported by general City revenues such as taxes, and by specific program revenues. Business-type activities - All the City’s enterprise activities are reported here, including water, sewer, and solid waste transport. Unlike govern mental services, these services are supported by charges paid by users based on the amount of the service they use.
Government-wide financial statements are prep ared on the accrual basis, which means they measure the flow of all economic resources of the City as a whole.
Fund Financial Statements
The Fund Financial Statements pr ovide detailed information about each of the City’s most significant funds, called major funds. Each majo r fund is presented individually, with all non- major funds summarized and presented only in a single column. Subordinate schedules present the detail of these non-major funds. Major funds presen t the major activities of the City for the year and may change from year to year because of changes in the pattern of the City’s activities.
Governmental fund financial statements are prepared on the modified accrual basis, which means they measure only current financial resources and uses. Capital assets and other long-lived assets, along with long-term liabilities, are not presented in the governmental fund financial statements.
Enterprise fund financial statements are prepared on the full accrual basis, and include all their assets and liabilities, both current and long-term.
Since the City’s internal service funds provide goods and services only to the City’s governmental and business-type activitie s, their activities are re ported only in total at the fund level. Internal service funds cannot be major funds because thei r revenues are derived from other City funds.
These revenues are eliminated in the City-wide financial statements and any related profits or losses are returned to the activities which created them, along with any residual net position of the internal service funds.
Comparisons of budget and actual financial information are pr esented only for the General Fund and other major funds that are special revenue funds.
Fiduciary Statements – The City is the fiscal agent for a few small local agencies. Fiduciary activities are reported in the separate Statemen t of Fiduciary Net Position. These activities are excluded from the City’s other fina ncial statements because the Ci ty cannot use these assets to finance its own operations.
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FINANCIAL ACTIVITIES OF THE CITY AS A WHOLE
This analysis focuses on the net position and changes in net position of the City’s governmental activities and business-type activities (Tables 1, 2, and 3) presented in the City-wide Statement of Net Position and Statement of Activities that follow.
Table 1
Net Position at June 30
(in thousands)
Government
al Activities
The City’s net position from governmental activities decreased from $51.6 million in FY 2020 to $45.1 million in FY 2021. The decrease in the Cha nge in Net Position reflected in the Statement of Activities, as shown in Table 1. Increases and decreases of individua l assets and liabilities include:
Governmental cash and investments increas ed $16.9 million from $139.5 million in FY 2020 to $156.4 million in FY 2021 mainly due to the receipt of $12.6 million in American Rescue Plan Act (ARPA) fede ral grant funds and a signifi cant increase in Engineering deposits.
In FY 2021, $0.3 million in Housing and Ur ban Development Section 108 Loan and $3.2 million in Pension Obligation Bonds were retired.
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Other liabilities increased $18.8 million because of the increase in Engineering deposits and the placement of the $12.6 million in new ARPA funding in unearned revenue until the City allocates the funding.
Restricted net position increased $8.7 mill ion. The unrestricted net position declined by $11.6 million from ( $76.1 million) in FY 2020 to ($87.7 million) in FY 2021. The City’s unrestricted net position was negatively imp acted in fiscal year 2014-15 with the implementation of GASB 68, which continues to require the disclosure of the City’s unfunded pension liability.
Business-type Activities
The net position of business-type activities increased $2.7 million to a total of $97.4 million in FY 2021 from $94.7 million in FY 2020. Increases and decr eases of individual assets and liabilities are as follows:
Cash and investments in creased $4.7 million and partially reflect an increase in revenues in both the Water and Sanitation funds.
Long-term debt decreased $0.9 million due to ongoing debt payments. Investments in infrastructure and major capital improvements began to return to more normal levels in FY 2021, even with the continuing economic unc ertainties from COVID-19. However, no significant projects were completed and there was a decrease of $2.0 million in capital assets as current year depreciation expenses exceeded capital additions. Unrestricted net position increased $3.8 million to $31.4 million in FY 2021.
Changes in Net Position
Total governmental activities revenues in FY 2021 amounted to $10 6.5 million compared to $117.0 million in FY 2020, a decrease of $10.5 million in FY 2021 due to a decrease in property tax, other taxes, charges for services and invest ment earnings. Governmental expenses increased by $4.3 million in FY 2021.
Total business-type activities revenues decreased $0.2 million in FY 2021 and expenses increased $1.6 million.
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Table 2
Changes in Net Position
For Years Ended June 30
(in thousands)
Governmen
tal Activities
Table 3 presents the net cost of each of the City’s governmental programs. Net cost is defined as total program cost less the revenues generated by those sp ecific activities and corresponds to the Statement of Activities amounts. In general terms, the net cost il lustrates the financial burden placed on the City’s general taxpayers to fund these essential City services. 10
Table 3
Governmental Activities
For the Year Ended June 30, 2021
(in thousands)
THE CITY’S FUND FINANCIAL STATEMENTS
Governmental Funds
At June 30, 2021, the City’s major governmental funds consist of the General Fund, Gas Tax Fund, Grants Fund and Capital Projects Fund. The focus of the governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City’s financial status.
The General Fund’s total fund balance decreas ed $10.7 million to $62.9 million in FY 2021 compared to $73.6 million in FY 2020.
General Fund revenues for FY 2021 decreased by $5.7 million to $89.8 million from $95.5 million in FY 2020 due to lower property taxes, other taxes, charges and fees, and interest income in 2021.
General Fund expenditures increased by $8.7 mil lion to $95.7 million in FY 2021, primarily due to increases in salaries that were in accordance with memoranda of understanding.
In FY 2021, the Gas Tax Special Revenue Fund total fund balance increas ed by $5.5 million to $12.4 million. The balance in this fund represents funds that are legally required to be spent on local roadway projects. All such amounts are budgeted for future e xpenditure as laid out in the multi-year capital improvement plan. Gas Tax Fund revenues increased s lightly in FY 2021 to $11.0 million compared to FY 2020 at $10.7 million due to con tinuing strong revenues from SB- 1 Road Maintenance and Measure A County fundi ng and higher grant amounts. Gas Tax Special Revenue Fund expenditures decreased $1.7 million in FY 2021. 11
The Capital Projects Fund total fund balance increased $2.9 million in FY 2021 to $28.4 million compared to $25.5 million in FY 2020. This Fund is de signated for specific capital projects that will benefit the community. Capital Projects Fund revenues decreased $3.7 million in FY 2021 to $2.8 million. Capital Projects Fund expenditures increased $0.3 million in FY 2021.
Enterprise Funds
The City has two major enterprise funds, the Water Utility Fund and the Sanitation District Fund.
Water Utility operating revenues in FY 2021 increased $0.3 million to $23.9 million compared to FY 2020 even though the Water Utility delayed the FY 2021 water increase for six months due to the COVID-19 pandemic. Operating expenses decreased $0.2 million in FY 2021 to $16.7 million.
Sanitation District operating revenues increased $0.8 million to $23.5 million in FY 2021 due to most likely an increase in water usage duri ng the COVID-19 pandemic. Operating expenses increased by $2.3 million to $28.3 million in FY 2021 primarily due to increases for insurance, services and supplies, and pension and OPEB costs.
General Fund Budgetary Highlights
The City typically uses a biennial budgeting process. Two individual budget years are proposed to the City Council at the same time , with mid-budget adjustments at the end of the first of the two years. This process provides more opportunity for long-term planning but does require adjustments based on changing economic conditions. However, due to COVID-19, the City completed a one- year budget process for FY 2021. Revenues were below budget by about $8.8 million because the City originally budgeted to utilize half of its American Rescue Plan Act funds ($12.6 million) in FY 2021 to offset revenues losses. The City did not recognize the revenue in FY 2021 and instead will see funding dispersed within the FY 2022 budget and FY 2023 budget. Expenditures were below final budgeted amounts by $9.2 million mostly because of staffing vacancies. Differences between original and final budget occur primarily due to the impact of new revenues, small grants or reimbursements, or the need to reallocate resources during the fiscal year. 12
CAPITAL ASSETS
At the end of FY 2021 the City had $168.0 million, net of accumulated depreciation, invested in a broad range of capital assets, as shown in Table 4 below (further detail may be found in Note 4 to the financial statements):
Table 4
Capital Assets Net of Depreciation at June 30
(in thousands)
13
DEBT ADMINISTRATION
Each of the City’s debt issues is discussed in detail in Note 5 to the financial statements. At June 30, the City’s debt was comprised of:
Table 5
Outstanding Debt
(in thousands)
Original
Description Interest Principal 2021 2020 2021 2020 2021 2020 State Water Resources Control Board 2.50% 4,450 $ -$ -$ 1,087$ 1,342$ 1,087$ 1,342 $ Revolving Fund Loan for Sanitation
District Recycled Water Project
Issued November 18, 2003
Maturity December 1, 2024
HUD Section 108 Loan for 0.35% to 4,500 $ 808 1,173 - - 808 1,173 Bayshore Community Center 2.49%
Issued January 29, 2004
Maturity August 1, 2022
Pension Obligation Bonds 2.65% to 36,235$ 11,810 15,025 - - 11,810 15,025 Issued June 1, 2004 5.896%
Maturity June 1, 2024
Water Revenue Refunding Bonds to 2.00% to 6,890$ - - 1,880 2,480 1,880 2,480 Refinance Water Certificates of 3.00%
Participation
Issued September 10, 2012
Maturity June 1, 2024
Equipment Lease Purchase 2.7% 1,483$ 1,483 - - - 1,483 - Commuity First Bank
Issued December 18. 2020
Maturity December 18. 2028
Total City Long-Term Debts 14,101$ 16,198 $ 2,967 $ 3,822 $ 17,068 $ 20,020 $ Governmental
Activities Primary Government
Business-type
Activities
Total
ECONOMIC FACTORS
During fiscal year (FY) 2020-21, the City continued to experience a decline in revenues and limited economic growth due to the ongoing COVID-19 health emergency. Like many other jurisdictions, the City experienced a decline in sales tax revenue, though some of that decline was masked by new sales tax revenue resulting from the passage of Measure Q - the Daly City Local Recovery &
Relief Measure. Measure Q was approved by voters in November 2020 and th e City began receiving revenue in April of 2021. Also, since tourism all but ceased, Transient Occupancy Tax saw a large decline compared to the previous year. Similarly, Interest on Investment declined significantly in FY 2021.
14
ADDITIONAL INFORMATION
This Annual Comprehensive Financial Report is intended to provide citizens, taxpayers, investors, and creditors with a general overv iew of the City’s finances. Questions about this Report should be directed to the Department of Finance and Administrative Services, 333 90 th Street, Daly City California, 94015. Additional information about th e City of Daly City, including our budget documents, can be found at www.dalycity.org.
15
STATEMENT OF NET POSITION AND
STATEMENT OF ACTIVITIES
The Statement of Net Position and the Statement of Activities summarize the entire City’s financial activities and financial position.
They are prepared on the same basis as is used by
most businesses, which means they include all the City’s assets and deferred outflows of resources and all its liabilities and deferred inflows of resources, as well as all its revenues and expenses. This is known as the full accrual basi s—the effect of all the City’s transactions is taken into account, regardless of whether or when cash changes hands, but all material internal transactions between City funds have been eliminated.
The Statement of Net Position reports the difference between the City’s total assets and deferred outflows of resources and the City’s total liabilities and deferred inflows of resources, including all the City’s capital assets and all its long-term debt. The Statement of Net Position focuses the reader on the composition of the City’s Net Position, by subtracting total liabilities from total assets.
The Statement of Net Position summarizes the financial position of all of the City’s Governmental Activities in a single column. The City’s Governmental Activities include the activities of its General Fund, along with all its Special Revenue, Capital Projects and Debt Service Funds.
The Statement of Activities reports increases and decr eases in the City’s Net Position. It is also prepared on the full accrual basis, which mean s it includes all the City’s revenues and all its expenses, regardless of when cash changes hands. This differs from the “modified accrual” basis used in the Fund financial statements, which reflect only current assets, current liabilities, available revenues and measurable expenditures.
The Statement of Activities presents the City’s expenses first, listed by program. Program revenues—that is, revenues which are generated directly by these programs—are then deducted from program expenses to arrive at the net expense of each governmental program. The City’s general revenues are then listed in the Governmental Activities and the Change in Net Position is computed and reconciled with the Statement of Net Position. 17
CITY OF DALY CITY
STATEMENT OF NET POSITION
Governmental Business-Type
Activities Activities Total
ASSETS
Cash and investments (Note 1G) $152,671,109 $51,627,768 $204,298,877 Cash with fiscal agent (Note 1G) 549 11,324 11,873
Restricted cash (Note 1G) 3,746,447 3,746,447
Accounts receivable, net 12,219,104 6,199,451 18,418,555 Inventories (Note 1H) 204,860 1,944,469 2,149,329
Prepaids (Note 1H) 2,001,763 6,347 2,008,110
Internal balances (Note 6) (1,342,510) 1,342,510
Notes receivable (Note 12) 1,418,406 1,418,406
Loan receivable from Successor Agency (Note 14C) 13,330,550 13,330,550 Property held for development (Note 1C) 3,366,888 3,366,888 Capital assets (Note 4):
Nondepreciable capital assets 44,240,291 11,856,117 56,096,408 Depreciable capital assets, net 54,839,731 57,138,721 111,978,452 Total Assets 286,697,188 130,126,707 416,823,895
DEFERRED OUTFLOWS OF RESOURCES
Related to pension (Note 7D) 25,930,616 3,604,306 29,534,922 Related to OPEB (Note 8E) 4,757,837 745,413 5,503,250
Total Deferred Outflows of Resources 30,688,453 4,349,719 35,038,172
LIABILITIES
Accounts payable 9,009,320 2,380,599 11,389,919
Accrued payroll 1,230,024 108,610 1,338,634
Deposits payable 7,794,030 19,000 7,813,030
Unearned revenue 12,627,672 12,627,672
Interest payable 87,234 18,981 106,215
Compensated absences (Note 1K):
Due within one yea
r 5,393,920 833,451 6,227,371
Due in more than one year 6,836,911 1,538,939 8,375,850 Accrued claims payable (Note 10):
Due within one year 2,452,655 2,452,655
Due in more than one year 7,697,345 7,697,345
Net OPEB liability, due in more than one year (Note 8C) 36,406,234 5,703,792 42,110,026 Net pension liability, due in more than one year (Note 7C) 165,259,949 22,922,234 188,182,183 Long-term debt (Note 5):
Due within one yea
r 4,145,490 876,709 5,022,199
Due in more than one year 9,955,566 2,090,045 12,045,611 Total Liabilities 268,896,350 36,492,360 305,388,710
DEFERRED INFLOWS OF RESOURCES
Related to pension (Note 7D) 51,967 51,967
Related to OPEB (Note 8E) 3,260,238 510,784 3,771,022
Total Deferred Inflows of Resources 3,312,205 510,784 3,822,989 NET POSITION (Note 11)
Net investment in capital assets 96,788,966 66,028,084 162,817,050 Restricted for:
Debt service 549 11,324 11,873
Streets and roads 12,488,380 12,488,380
Infrastructure 11,936,252 11,936,252
Low and Moderate Income Housing Asset 8,968,790 8,968,790 Other 2,739,352 2,739,352
Total Restricted Net Position 36,133,323 11,324 36,144,647 Unrestricted (87,745,203) 31,433,874 (56,311,329)
Total Net Position $45,177,086 $97,473,282 $142,650,368 See accompanying notes to financial statements
JUNE 30, 2021
18
CITY OF DALY CITY
FOR THE YEAR ENDED JUNE 30, 2021
Net (Expense) Revenue and
Changes in Net Position
Operating Capital
Charges for Grants and Grants an d Governmental Business-type Functions/Programs Expenses Services Contribu tions Contributions Activities Activities Total Governmental Activities:
General government $13,339,758 $422,110 $7,443,826 $189, 998 ($5,283,824) ($5,283,824) Public safety 67,486,476 5,371, 364 1,342,082 (60,773,030) (60,773,030) Public works 17,734,741 4,113,341 6, 979,107 2,282,077 (4,360,216) (4,360,216) Culture and recreation 10,761,931 502,031 983,447 (9,276,453) (9,276,453) Economic and community development 5,193,416 4,054,903 1,531,687 393,174 393,174 Interest on long-term debt 820,486 (820,486) (820,486)
Total Governmental Activities 115,336,808 14,463,749 18,280,149 2,472,075 (80,120,835) (80,120,835) Business-type Activities:
Water Utility 16,761,016 23,672,903 $6,911,887 6,911,887 Civic Center 863,506 881,616 18,110 18,110
Transfer Station (213) 213 213
Sanitation District 28,264,570 23,364,666 (4,899,904) (4,899,904) Total Business-type Activities 45,888,879 47,919,185 2,030,306 2,030,306 Total $161,225,687 $62,382,934 $18,280,149 $2,472,075 (80,120,835) 2,030,306 (78,090,529) General revenues:
Taxes:
Property tax 33,949,879 2,335,681 36,285,560
Sales tax 18,566,645 18,566,645
Utility users tax 5,912,945 5,912,945
Franchise fees 4,255,982 4,255,982
Other taxes 7,300,774 7,300,774
Investment earnings (109,320) 7,164 (102,156)
Gain from sale of capital assets 344,034 1,852 345,886
Miscellaneous 1,150,745 643,228 1,793,973
Transfers (Note 6) 2,282,058 (2,282,058)
Total general revenues and transfers 73,653,742 705,867 74,359,609 Change in Net Position (6,467,093) 2,736,173 (3,730,920) Net Position-Beginning 51,644,179 94,737,109 146,381,288 Net Position-Ending $45,177,086 $97,473,282 $142,650,368 See accompanying notes to financial statements
STATEMENT OF ACTIVITIES
Program Revenues
19
FUND FINANCIAL S
TATEMENTS
Major funds are defined generally as having significant activities or balances in the current year. 21
CITY OF DALY CITY
GOVERNMENTAL FUNDS
BALANCE SHEET
JUNE 30, 2021
Other Total
Capital Governmental Governmental
General Gas Tax Grants Pro jects Funds Funds
ASSETS
Cash and investments (Note 1G) $64,011,242 $11,983,765 $209,775 $28,647,705 $6,236,785 $111,089,272 Restricted cash and investments (Note 1G) 3,746,447 3,746,447 Accounts receivable, net 9,596,160 1,525,624 556,605 207,674 286,309 12,172,372 Due from other funds (Note 6) 241,028 241,028
Prepaids (Note 1H) 518,707 518,707
Inventories (Note 1H) 18,640 25,184 43,824
Notes receivable (Note 12) 396,938 1,021,468 1,418,406
Loan receivable from Successor Agency (Note 14C) 13,330,550 13,330,550 Property held for development (Note 1C) 3,366,888 3,366,888 Total Assets $91,462,774 $13,534,573 $1,163,318 $28,855,379 $10,911,450 $145,927,494
LIABILITIES
Accounts payable $6,970,414 $1,032,623 $66,576 $427,238 $46,157 $8,543,008 Accrued payroll 1,166,165 13,570 3,275 3,950 1,186,960
Due to other funds (Note 6) 241,028 241,028
Deposits payable 7,788,390 5,640 7,794,030
Unearned revenue 12,627,672 12,627,672
Total Liabilities 28,552,641 1,046,193 69,851 427,238 296,775 30,392,698
DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - loans 396,938 1,021,468 1,418,406
FUND BALANCES
Fund Balance (Note 11)
Nonspendable 13,875,487 25,184 13,900,671
Restricted 3,746,447 12,463,196 696,529 11,936,252 9,593,321 38,435,745 Assigned 375,051 16,491,889 16,866,940
Unassigned 44,913,148 (114) 44,913,034
Total Fund Balances 62,910,133 12,488,380 696,529 28,428,141 9,593,207 114,116,390 Total Liabilities, Deferred Inflows of
Resources and Fund Balances $91,462,774 $13,534,573 $1,163,318 $28,855,379 $10,911,450 $145,927,494 See accompanying notes to financial statements
22
CITY OF DALY CITY
Reconciliation of the
GOVERNMENTAL FUNDS - BALANCE SHEET
with the
STATEMENT OF NET POSITION
JUNE 30, 2021
Total fund balances reported on the Governmental Funds Balance Sheet $114,116,390 Amounts reported for Governmental Activities in the Statement of Net Position are different from those reported in the Governmental Funds above because of the following:
CAPITAL ASSETS
Capital assets used in Governmental Activities are not current assets or financial resources and therefore are not reported in the Governmental Funds. 91,688,339
ALLOCATION OF INTERNAL SERVICE FUND NET POSITION
Internal service funds are not governmental funds. However, they are used by management to charge the costs of certain activities, such as insurance, central services and maintenance to individual governmental funds. The net current assets of the internal service funds are therefore included in Governmental Activities in the following line items in the Statement of Net Position.
Cash and investments 41,582,386
Accounts receivable 46,732
Prepaids 1,483,056
Deferred outflows 395,992
Inventories 161,036
Internal balances (1,342,510)
Capital assets 7,391,683
Accounts payable (466,312)
Accrued payroll (43,064)
Interest payable (79,144)
Accrued claims payable (10,150,000)
Compensated absences (737,073)
Net OPEB liability (3,030,139)
Deferred inflows (271,353)
Long-term debt - due within one yea
r (3,755,490)
Long-term debt - due in more than one year (9,537,566)
ACCRUAL OF NONCURRENT REVENUES AND EXPENSES
Revenues which are deferred on the Fund Balance Sheets because they are not available currently are taken into revenue in the Statement of Activities. 1,418,406
DEFERRED INFLOWS AND OUTFLOWS
The deferred outflows below are not current assets or financial resources; and the deferred inflows are not due and payable in the current period and therefore are not reported in the Governmental Funds.
Deferred outflows 30,292,461
Deferred inflows (3,040,852)
LONG TERM ASSETS AND LIABILITIES
The liabilities below are not due and payable in the current period and therefore are not reported in the funds:
Long-term debt (808,000)
Interest payable (8,090)
Net OPEB liability (33,376,095)
Net pension liability (165,259,949)
Compensated absences (11,493,758)
NET POSITION OF GOVERNMENTAL ACTIVITIES
$45,177,086
See accompanying notes to financial statements
23
CITY OF DALY CITY
GOVERNMENTAL FUNDS
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE YEAR ENDED JUNE 30, 2021
Other Total
Capital Governmental Governmental
General Gas Tax Grants Pro jects Funds Funds
REVENUES
Property tax $33,949,879 $33,949,879
Gas tax $4,404,530 4,404,530
Sales tax 15,570,850 2,995,795 18,566,645
Utility users tax 5,912,945 5,912,945
Franchise fees 4,255,982 4,255,982
Other taxes 7,300,774 7,300,774
Licenses and permits 2,981,237 2,981,237
Fines and forfeitures 3,040,526 3,040,526
Rents and interest 562,070 1,965 $5,791 ($56,565) $51,185 564,446 Federal programs and grants 2,014,965 422,222 215,118 994,785 3,647,090 Receipts from other agencies 8,388,845 435,446 927,537 254,055 10,005,883 Charges and fees 5,636,364 1,125,210 2,201,354 72,084 9,035,012 Miscellaneous 2,218,015 90,653 63,237 189,998 262,784 2,824,687 Total Revenues 89,817,487 11,068,564 1,418,787 2,803,960 1,380,838 106,489,636
EXPENDITURES
Current:
General government 12,818,394 5,000 12,823,394
Public safety 63,235,389 526,755 29,063 63,791,207
Public works 5,644,073 3,756,419 26,353 9,426,845
Culture and recreation 10,125,396 71,231 10,196,627
Economic and community development 3,971,153 381,301 1,123,929 5,476,383 Capital projects 6,291,602 276,927 3,070,593 9,639,122
Debt service:
Principal 365,000 365,000
Interest 23,020 23,020
Total Expenditures 95,794,405 10,048,021 1,261,214 3,070,593 1,567,365 111,741,598
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (5,976,918) 1,020,543 157,573 (266,633) (186,527) (5,251,962)
OTHER FINANCING SOURCES (USES)
Proceeds from sale of property 379,095 379,095
Transfers in (Note 6) 3,330,227 5,321,092 4,833,167 228,500 13,712,986 Transfers (out) (Note 6) (8,490,365) (840,304) (1,661,410) (10,992,079) Total Other Financing Sources (Uses) (4,781,043) 4,480,788 3,171,757 228,500 3,100,002 NET CHANGES IN FUND BALANCES (10,757,961) 5,501,331 157,573 2,905,124 41,973 (2,151,960) BEGINNING FUND BALANCES 73,668,094 6,987,049 538,956 25,523,017 9,551,234 116,268,350 ENDING FUND BALANCES $62,910,133 $12,488,380 $696,529 $28,428,141 $9,593,207 $114,116,390 See accompanying notes to financial statements
24
CITY OF DALY CITY
Reconciliation of the
NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FUNDS
with the
STATEMENT OF ACTIVITIES
The schedule below reconciles the Net Changes in Fund Balances reported on the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balance, which measures only changes in current assets and current liabilities on the modified accrual basis, with the Change in Net Position of Governmental Activities reported in the Statement of Activities, which is prepared on the full accrual basis.
NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FUNDS ($2,151,960) Amounts reported for governmental activities in the Statement of Activities are different because of the following:
CAPITAL ASSETS TRANSACTIONS
Governmental Funds report capital outlays as expenditures. However, in the Statement of Activities the cost of those assets is capitalized and allocated over their estimated useful lives and reported as depreciation expense.
The capital outlay expenditures are therefore added back to fund balance. 7,436,748 Depreciation expense is deducted from fund balance
(Depreciation expense is net of internal service fund depreciation of $900,361 which has already been allocated to serviced funds). (4,335,479) Retirements are deducted from fund balance (5,205,335)
LONG TERM DEBT PROCEEDS AND PAYMENTS
Bond proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the Statement of Net Position.
Repayment of bond principal is an expenditure in the governmental funds, but in the Statement of Net Position the repayment reduces long-term liabilities.
Repayment of debt principal is added back to fund balance 365,000 Interest accrued is deducted from fund balance 93,730
ACCRUAL OF NONCURRENT ITEMS
The amounts below included in the Statement of Activities do not provide or (require) the use of current financial resources and therefore are not reported as revenue or expenditures in governmental funds:
Unavailable revenue (108,953)
Compensated absences (1,906,444)
OPEB expense 2,289,427
Pension expense (8,861,872)
ALLOCATION OF INTERNAL SERVICE FUND ACTIVITY
Internal service funds are used to charge the costs of certain activities, such as equipment acquisition, maintenance, and insurance to individual funds.
The portion of the net revenue (expense) of these internal service funds arising out of their transactions with governmental funds is reported with governmental activities, because they service those activities.
Change in net position of all internal service funds 5,918,045 CHANGE IN NET POSITION OF GOVERNMENTAL ACTIVITIES ($6,467,093) See accompanying notes to financial statements
FOR THE YEAR ENDED JUNE 30, 2021
25
CITY OF DALY CITY
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2021
Variance with
Budgeted Amounts Final Budget
Positive
Original Final Actual Amounts (Negative)
REVENUES
Property tax $34,484,256 $33,715,121 $33,949,879 $234,758 Sales tax 12,939,190 14,505,744 15,570,850 1,065,106
Utility users tax 5,753,754 5,857,300 5,912,945 55,645
Franchise fees 4,236,246 4,475,461 4,255,982 (219,479)
Other taxes 5,918,703 19,701,972 7,300,774 (12,401,198) Licenses and permits 2,708,823 2,546,922 2,981,237 434,315 Fines and forfeitures 3,798,742 3,683,768 3,040,526 (643,242) Rents and interest 1,254,584 1,859,697 562,070 (1,297,627) Receipts from other agencies 633,406 6,926,178 8,388,845 1,462,667 Charges and fees 5,899,445 5,033,244 5,636,364 603,120
Miscellaneous 3,655,908 353,825 2,218,015 1,864,190
Total Revenues 81,283,057 98,659,232 89,817,487 (8,841,745)
EXPENDITURES
Current Operations:
General Government
Legislative:
Salaries and benefits 186,956 255,795 247,717 8,078
Services and supplies 39,462 41,211 36,623 4,588
Other charges 36,812 14,638 16,267 (1,629)
Total Legislative 263,230 311,644 300,607 11,037
Legal:
Salaries and benefits 928,657 1,071,492 1,020,437 51,055 Services and su
pplies 178,632 192,295 170,004 22,291
Other charges 8,666 8,726 5,394 3,332
Total Legal 1,115,955 1,272,513 1,195,835 76,678
Administrative:
Salaries and benefits 8,326,687 7,845,907 8,525,636 (679,729) Services and supplies 1,905,289 2,468,809 2,160,493 308,316 Other charges 1,190,518 1,214,214 635,823 578,391
Total Administrative 11,422,494 11,528,930 11,321,952 206,978 Total General Government 12,801,679 13,113,087 12,818,394 294,693 Public Safety
Police:
Salaries and benefits 29,711,074 35,766,185 30,282,473 5,483,712 Services and su
pplies 6,898,181 7,633,056 7,282,381 350,675
Capital outlay 85,750 319,035 406,945 (87,910)
Other charges 496,539 496,754 449,915 46,839
Total Police 37,191,544 44,215,030 38,421,714 5,793,316 Fire:
Salaries and benefits 18,086,111 21,982,738 21,456,254 526,484 Services and supplies 2,736,581 3,055,807 2,896,034 159,773 Capital outlay 63,782 203,101 254,211 (51,110)
Other charges 123,499 168,389 207,176 (38,787)
Total Fire 21,009,973 25,410,035 24,813,675 596,360
Total Public Safety 58,201,517 69,625,065 63,235,389 6,389,676 (Continued)
26
CITY OF DALY CITY
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2021
Variance with
Budgeted Amounts Final Budget
Positive
Original Final Actual Amounts (Negative)
Public Works
Salaries and benefits 3,123,108 4,717,933 3,909,739 808,194 Services and supplies 928,616 1,906,111 1,661,008 245,103 Other charges 86,221 84,963 73,326 11,637
Total Public Works 4,137,945 6,709,007 5,644,073 1,064,934 Culture and Recreation
Salaries and benefits 5,970,987 5,871,572 5,318,123 553,449 Services and supplies 4,618,786 4,827,149 4,714,726 112,423 Capital outlay 10,000 10,000 8,094 1,906
Other charges 73,440 80,940 84,453 (3,513)
Total Culture and Recreation 10,673,213 10,789,661 10,125,396 664,265 Economic and Community Development
Salaries and benefits 3,209,306 3,692,865 2,946,995 745,870 Services and supplies 842,475 1,097,236 985,956 111,280 Other charges 58,416 57,504 38,202 19,302
4,110,197 4,847,605 3,971,153 876,452
Total Expenditures 89,924,551 105,084,425 95,794,405 9,290,020
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (8,641,494) (6,425,193) (5,976,918) 448,275
OTHER FINANCING SOURCES (USES)
Proceeds from sale of property 629,195 379,095 (250,100) Transfers in 3,257,661 3,330,225 3,330,227 2
Transfers out (695,064) (11,007,617) (8,490,365) 2,517,252 Total Other Financing Sources (Uses) 2,562,597 (7,048,197) (4,781,043) 2,267,154 NET CHANGE IN FUND BALANCE ($6,078,897) ($13,473,390) (10,757,961) $2,715,429 BEGINNING FUND BALANCE 73,668,094
ENDING FUND BALANCE $62,910,133
See accompanying notes to financial statements
Total Economic and Community Development
27
CITY OF DALY CITY
GAS TAX SPECIAL REVENUE FUND
STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2021
Variance with
Budgeted Amounts Final Budget
Positive
Original Final Actual Amounts (Negative)
REVENUES
Gas tax $4,696,000 $4,688,918 $4,404,530 ($284,388)
Sales tax 1,800,000 2,654,221 2,995,795 341,574
Rents and interest 40,000 70,000 1,965 (68,035)
Federal programs and grants 2,768,716 2,014,965 (753,751) Receipts from other agencies 300,000 2,246,511 435,446 (1,811,065) Charges and services 1,043,171 1,114,225 1,125,210 10,985 Miscellaneous 2,500 23,679 90,653 66,974
Total Revenues 7,881,671 13,566,270 11,068,564 (2,497,706)
EXPENDITURES
Public works 3,978,008 4,429,279 3,756,419 672,860
Capital projects 7,440,145 16,454,116 6,291,602 10,162,514 Total Expenditures 11,418,153 20,883,395 10,048,021 10,835,374
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (3,536,482) (7,317,125) 1,020,543 8,337,668
OTHER FINANCING SOURCES (USES)
Transfers in 590,000 6,290,626 5,321,092 (969,534)
Transfers out (340,217) (840,304) (840,304)
Total Other Financing Sources (Uses) 249,783 5,450,322 4,480,788 (969,534) NET CHANGE IN FUND BALANCE ($3,286,699) ($1,866,803) 5,501,331 $7,368,134 BEGINNING FUND BALANCE 6,987,049
ENDING FUND BALANCE $12,488,380
See accompanying notes to financial statements
28
CITY OF DALY CITY
GRANTS SPECIAL REVENUE FUND
STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2021
Variance
Positive
Original Final Actual (Negative)
REVENUES
Rents and interest $100 $7,487 $5,791 ($1,696)
Federal programs and grants 284,168 1,519,901 422,222 (1,097,679) Receipts from other agencies 525,250 1,160,378 927,537 (232,841) Miscellaneous revenue 63,237 63,237
Total Revenues 809,518 2,751,003 1,418,787 (1,332,216)
EXPENDITURES
General Government
Administrative:
Services and supplies 5,000 5,000
Total General Government 5,000 5,000
Public Safety
Salaries and benefits 159,266 156,429 2,837
Services and supplies 146,835 316,898 200,083 116,815
Capital outlay 189,152 117,891 71,261
Other charges 83,178 52,352 30,826
Total Public Safety 146,835 748,494 526,755 221,739
Public Works
Capital Outlay 278,000 623,527 276,927 346,600
Total Public Works 278,000 623,527 276,927 346,600
Culture and Recreation
Salaries and benefits 242,260 201,066 52,825 148,241
Services and supplies 4,000 59,949 18,406 41,543
Total Culture and Recreation 246,260 261,015 71,231 189,784 Economic and Community Development
Salaries and benefits 27,560 62,957 59,845 3,112
Services and supplies 1,500 100,357 54,254 46,103
Other charges 255,751 1,413,604 267,202 1,146,402
Total Economic and Community Development 284,811 1,576,918 381,301 1,195,617 Total Expenditures 955,906 3,214,954 1,261,214 1,953,740 NET CHANGE IN FUND BALANCE ($146,388) ($463,951) 157,573 $621,524 BEGINNING FUND BALANCE 538,956
ENDING FUND BALANCE $696,529
Budgeted Amounts
See accompanying notes to financial statements
29
CITY OF DALY CITY
PROPRIETARY FUNDS
STATEMENT OF NET POSITION
JUNE 30, 2021
Business-type Activities-Enterprise Funds Governmental
Other Activities-
Water Sanitation Enterprise Internal Service
Utility District Funds Totals Funds
ASSETS
Current Assets:
Cash and investments (Note 1G) $19,798,897 $28,779,079 $3,049,792 $51,627,768 $41,581,837 Cash with fiscal agent (Note 1G) 11,324 11,324 549
Accounts receivable, net (Note 1I) 4,766,933 1,417,995 14,523 6,199,451 46,732 Inventories (Note 1H) 393,125 1,551,344 1,944,469 161,036 Prepaids 2,373 3,974 6,347 1,483,056
Total Current Assets 24,972,652 31,752,392 3,064,315 59,789,359 43,273,210 Noncurrent Assets:
Advance to other funds (Note 6) 5,097,520 5,097,520
Capital Assets (Note 4):
Land 839,856
233,547 1,789,146 2,862,549 378,343
Buildings 272,379 893,519 6,753,006 7,918,904 35,817
Sewage facilities 59,021,605 59,021,605
Wells and pump stations 9,074,783 9,074,783
Water reservoirs 12,715,925 12,715,925
Mains and subsurface lines 21,074,931 26,871,004 47,945,935 Equipment 6,232,397 9,799,624 957,617 16,989,638 23,356,694 Furniture and fixtures 37,154 114,174 151,328 63,104
Construction in progress 632,489 8,361,079 8,993,568 331,402 Total Capital Assets 50,879,914 105,294,552 9,499,769 165,674,235 24,165,360 Less accumulated depreciation (27,330,377) (63,044,918) (6,304,102) (96,679,397) (16,773,677) Net Capital Assets 23,549,537 42,249,634 3,195,667 68,994,838 7,391,683 Total Noncurrent Assets 23,549,537 47,347,154 3,195,667 74,092,358 7,391,683 Total Assets 48,522,189 79,099,546 6,259,982 133,881,717 50,664,893
DEFERRED OUTFLOWS OF RESOURCES
Related to pension (Note 7D) 927,832 2,676,474 3,604,306 Related to OPEB (Note 8) 198,000 547,413 745,413 395,992 Total Deferred Outflows 1,125,832 3,223,887 4,349,719 395,992
LIABILITIES
Current Liabilities:
Accounts payable 993,625 1,370,658 16,316 2,380,599 466,312 Accrued payroll 30,009 78,601 108,610 43,064
Deposits payable 19,000 19,000
Interest payable 3,133 15,848 18,981 79,144
Accrued claims payable (Note 10) 2,452,655
Compensated absences (Note 1K) 271,066 562,385 833,451
Long-term debt (Note 5) 615,000 261,709 876,709 3,755,490 Total Current Liabilities 1,931,833 2,289,201 16,316 4,237,350 6,796,665 Noncurrent Liabilities:
Compensated absences (Note 1K) 122,199 1,416,740 1,538,939 737,073 Accrued claims payable (Note 10) 7,697,345
Net OPEB liability (Note 8) 1,515,070 4,188,722 5,703,792 3,030,139 Net Pension Liability (Note 7C) 5,900,714 17,021,520 22,922,234 Long-term debt (Note 5) 1,265,000 825,045 2,090,045 9,537,566 Advance from other funds (Note 6) 5,097,520 5,097,520
Total Noncurrent Liabilities 13,900,503 23,452,027 37,352,530 21,002,123 Total Liabilities 15,832,336 25,741,228 16,316 41,589,880 27,798,788
DEFERRED INFLOWS OF RESOURCES
Related to pension (Note 7D)
Related to OPEB (Note 8) 135,677 375,107 510,784 271,353 Total Deferred Inflows 135,677 375,107 510,784 271,353
NET POSITION (Note 11)
Net investment in capital assets 21,669,537 41,162,880 3,195,667 66,028,084 5,908,627 Restricted for:
Debt service 11,324 11,324 549
Unrestricted 11,999,147 15,044,218 3,047,999 30,091,364 17,081,568 Total Net Position $33,680,008 $56,207,098 $6,243,666 96,130,772 $22,990,744 Some amounts reported for business-type activities in the statement of net position are different because certain internal service fund assets and liabilities are included in business-type activities 1,342,510 Net position of business-type activities $97,473,282
See accompanying notes to financial statements
30
CITY OF DALY CITY
PROPRIETARY FUNDS
STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN FUND NET POSITION
FOR THE YEAR ENDED JUNE 30, 2021
Business-type Activities-Enterprise Funds Governmental
Other Activities-
Water Sanitation Enterprise Internal Service
Utility District Funds Totals Funds
OPERATING REVENUES
Water sales $23,672,903 $57,689 $23,730,592
Sewer service charges 22,793,044 22,793,044
Connection charges 513,933 513,933
Rental income $881,616 881,616
Charges to City departments $24,556,255
Other revenues 263,320 226,347 153,561 643,228 667,572
Total Operating Revenues 23,936,223 23,591,013 1,035,177 48,562,413 25,223,827
OPERATING EXPENSES
Salaries and benefits 4,096,067 12,260,146 16,356,213 6,281,675 Services and supplies 1,560,232 9,929,351 488,425 11,978,008 5,391,715 Water purchases 7,828,953 7,828,953
Utilities 875,448 1,754,758 159,625 2,789,831 474,002
Insurance 267,835 680,412 19,346 967,593 2,094,201
Claims and settlements 2,459,361
Depreciation (Note 4) 1,184,182 2,468,562 190,693 3,843,437 900,361 Other charges 920,659 1,240,381 2,161,040 258,682
Total Operating Expenses 16,733,376 28,333,610 858,089 45,925,075 17,859,997 Operating Income (Loss) 7,202,847 (4,742,597) 177,088 2,637,338 7,363,830
NONOPERATING REVENUES (EXPENSES)
Property taxes 2,335,681 2,335,681
Gain on sale of capital assets 1,852 1,852 57,540
Loss on sale of capital assets (3,191)
Interest income 35,881 (23,298) (5,419) 7,164 (38,699)
Interest expense (65,366) (29,828) (95,194) (891,196)
Total Nonoperating Revenues (Expenses) (29,485) 2,284,407 (5,419) 2,249,503 (875,546) Income (Loss) Before Transfers 7,173,362 (2,458,190) 171,669 4,886,841 6,488,284 Transfers in (Note 6) 30,833 1,665,541 1,696,374 265,396 Transfers (out) (Note 6) (2,604,001) (1,201,987) (172,444) (3,978,432) (704,245) Net transfers (2,573,168) 463,554 (172,444) (2,282,058) (438,849) CHANGE IN NET POSITION 4,600,194 (1,994,636) (775) 2,604,783 6,049,435 BEGINNING NET POSITION 29,079,814 58,201,734 6,244,441 93,525,989 16,941,309 ENDING NET POSITION $33,680,008 $56,207,098 $6,243,666 96,130,772 $22,990,744 Net change in net position 2,604,783
Some amounts reported for business-type activities in the statement of activities are different because the net revenue (expense) of certain internal service funds is reported with business-type activities. 131,390
Change in net position of business-type activities $2,736,173 See accompanying notes to financial statements
31
CITY OF DALY CITY
PROPRIETARY FUNDS
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2021
Governmental
Other Activities-
Sanitation
Enterprise Internal Service
Water Utility District Funds Totals Funds
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers $23,557,631 $23,566,132 $1,249,861 $48,373,624 $25,442,607 Payments to suppliers (11,620,221) (14,405,605) (668,785) (26,694,611) (8,900,549) Payments to employees (3,785,205) (10,414,567) (14,199,772) (6,244,010) Claims paid (2,459,361)
Cash Flows from Operating Activities 8,152,205 (1,254,040) 581,076 7,479,241 7,838,687
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
Property tax 2,335,681 2,335,681
Principal paid on noncapital debt (3,215,000)
Interest paid on noncapital debt (885,875)
Advance from other funds 16,766 16,766
Advance to other funds (16,766) (16,766)
Transfers in 30,833 1,665,541 1,696,374 265,396
Transfers out (2,604,001) (1,201,987) (172,444) (3,978,432) (704,245) Cash Flows from (used for) Noncapital Financing Activities (2,556,402) 2,782,469 (172,444) 53,623 (4,539,724)
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Proceeds from sale of capital assets 1,852 1,852 57,540 Acquisition of capital assets (331,796) (1,576,210) (1,908,006) (500,692) Issuance of debt 1,483,056
Principal paid on capital debt (600,000) (255,326) (855,326) Interest paid on capital debt (66,366) (33,552) (99,918) Cash Flows from (used for) Capital and
Related Financing Activities (998,162) (1,863,236) (2,861,398) 1,039,904 CASH FLOWS FROM INVESTING ACTIVITIES:
Interest income 35,881 (23,298) (5,419) 7,164 (38,699)
Net Cash Flows 4,633,522 (358,105) 403,213 4,678,630 4,300,168 Cash and investments at beginning of period 15,176,699 29,137,184 2,646,579 46,960,462 37,282,218 Cash and investments at end of period $19,810,221 $28,779,079 $3,049,792 $51,639,092 $41,582,386 Reconciliation of Operating Income (Loss) to Cash Flows from Operating Activities:
Operating income (loss) $7,202,847 ($4,742,597) $177,088 $2,637,338 $7,363,830 Adjustments to reconcile operating income (loss) to cash flows from operating activities:
Depreciation 1,184,182 2,468,562 190,693 3,843,437 900,361 Change in assets and liabilities:
Accounts receivable, net (380,046) (24,881) 214,684 (190,243) 218,780 Inventories 1,155 (17,291) (16,136) (24,375)
Prepaids (2,373) (3,974) (6,347) (1,483,056)
Accounts payable (165,876) (779,438) (1,389) (946,703) (130,518) Accrued payroll 11,453 27,649 39,102 15,526
Deposits payable 1,454 1,454
Accrued claims payable 956,000
Compensated absences 110,616 257,754 368,370 44,428
Due to OPEB system (10,948) (30,821) (41,769) (22,289)
Due to retirement system 199,741 1,590,997 1,790,738
Cash Flows from Operating Activities $8,152,205 ($1,254,040) $581,076 $7,479,241 $7,838,687
NONCASH TRANSACTIONS
Retirement of capital assets ($3,191)
See accompanying notes to financial statements
Business-type Activities-Enterprise Funds
32
FIDUCIARY FUNDS
FIDUCIARY FUNDS
These funds are used to account for assets held by the City as an agent for individuals, private organizations, and other governments. The financial activities of these funds are excluded from the City-wide financial statements, but are presented in separate Fiduciary Fund financial statements.
SUCCESSOR AGENCY TO THE REDEVELOPMENT AGENCY PRIVATE PURPOSE TRUST
The fund is used to account for the activities of the Successor Agency to the former Redevelopment Agency of the City.
CUSTODIAL FUNDS
These funds report resources, not in a trust, that are held by the City for other parties outside of the City’s reporting entity.
33
CITY OF DALY CITY
FIDUCIARY FUNDS
STATEMENT OF FIDUCIARY NET POSITION
JUNE 30, 2021
Successor Agency Custodial Funds
to the External
Redevelopment Agency Custodial Investment
Private-Purpose Trust Funds Pool Fund
ASSETS
Cash and investments (Note 1G) $207,517 $1,763,828 $974,733 Receivables 2,558 2,422,510
Total Assets 210,075 4,186,338 974,733
LIABILITIES
Accounts payable 3,742,046
Due to others
Deposits payable 4,050
Loans payable to City (Note 14C) 13,330,550
Total Liabilities 13
,334,600 3,742,046
NET POSITION
Restricted for:
Other agencies and organizations (13,124,525) 444,292
Pool participan
t 974,733
Total Net Position ($13,124,525) $444,292 $974,733
See accompanying notes to financial statements
34
CITY OF DALY CITY
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FOR THE YEAR ENDED JUNE 30, 2021
Successor Agency Custodial Funds
to the External
Redevelopment Agency Custodial Investment
Private-Purpose Trust Funds Pool Fun d
ADDITIONS
Taxes $1,142,502
Charges for services
Receipts from other agencies $80,100
Rents and interest 39,900 ($13,362)
Other receipts
Total additions 1,182,402 80,100 (13,362)
DEDUCTIONS
Services and supplies 14,049
Culture and recreation 4,258
Other payments 2,316 128,363
Total deductions 16,365 4,258 128,363
CHANGE IN NET POSITION 1,166,037 75,842 (141,725)
NET POSITION
Net Position (Deficit) - Beginning, as Restated (Note 11D) (14,290,562) 368,450 1,116,458 Net Position (Deficit) - Ending ($13,124,525) $444,292 $974,733 See accompanying notes to financial statements
35
CITY OF DALY CITY
ANNUAL COMPREHENSIVE FINANCIAL REPORT
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2021
NOTE 1.
DESCRIPTION OF FUNDS AND SUMMARY OF ACCOUNTING POLICIES The City of Daly City (City) was incorporated on March 22, 1911 and operates under a council-manager form of government. Daly City is a general law city, and provides the following services: public safety (police and fire), highways and streets, water, sanitary sewer, social services, library, recreation, public improvements, planning and zoning, and general administrative services.
The Basic Financial Statements include financial information for entities which are directly or indirectly governed by the City Council. The entities included are the City, the North San Mateo County Sanitation District, and the Daly City Public Facilities Financing Corporation (see Note 2).
The accounting policies of the City conform with generally accepted accounting principles as they apply to governments. The following is a summary of the more significant policies.
A. BASIS OF
PRESENTATION
The City’s Basic Financial Statements are prepared in conformity with accounting principles generally accepted in the United States of America. The Governmental Accounting Standards Board is the acknowledged standard setting body for establishing accounting and financial reporting standards followed by governmental entities in the U.S.A. These standards require that the financial statements described below be presented.
Government-wide Statements: The Statement of Net Position and the Statement of Activities display information about the primary government (the City and its component units). These statements include the financial activities of the overall City government, except for fiduciary activities.
Eliminations have been made to minimize the double counting of internal activities. Interfund services provided and used are not eliminated in the process of consolidation. These statements distinguish between the governmental and business-type activities of the City. Governmental activities are generally financed through taxes, intergovernment al revenues, and other nonexchange transactions.
Business-type activities are financed in whole or in part by fees charged to external parties.
The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the City’s governmental activities and for each segment of the business-type activities of the City. Direct expenses are those that are sp ecifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Program revenues include charges paid by the recipients of goods or services offered by the programs, grants and contributions that are restricted to meeting the operational needs of a particular program and fees, grants and contributions that are restricted to financing the acquisition or construction of capital assets. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. 37
Fund Financial Statements: The fund financial statements provide information about the City's funds, including fiduciary funds and blended component units. Separate statements for each fund category— governmental, proprietary, and fiduciary —are presented. The emphasis of fund financial statements is on major individual governmental and enterprise funds, each of which is displayed in a separate column. All remaining governmental and enterprise funds are aggregated and reported as nonmajor funds.
Proprietary fund operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up essentially equal values. Nonoperating revenues, such as subsidies and investment earnings, result from nonexchange transactions or ancillary activities.
B. MAJOR FUNDS
Major funds are defined as funds which have either assets, liabilities, revenues or expenditures/expenses equal to ten percent of their fund-type total and five percent of the grand total of governmental and enterprise funds. Major governmental and business-type funds are identified and presented separately in the fund financial statements. All other funds, called nonmajor funds, are combined and reported in a single column, regardless of their fund type. The General Fund is always a major fund, and the City may select other funds it believes should be presented as major funds. The City selected the Gas Tax Fund for presentation as a major fund because of its importance and because it often qualifies as a major fund.
The City reported the following major governmental funds in the accompanying financial statements:
GENERAL FUND is the general operating fund of the City. It is used to account for all financial resources traditionally associated with governments which are not required to be accounted for in a separate fund.
GAS TAX SPECIAL REVENUE FUND is used to account for gas tax monies allocated by the State to the City for the streets and roads program.
GRANTS SPECIAL REVENUE FUND is used to account for miscellaneous grant monies, such as HOME, law enforcement special grants, and after school safety grants.
CAPITAL PROJECTS FUND is used to account for financial resources to be used for the acquisition or construction of major capital facilities or infrastructure other than those financed by proprietary funds.
The City reported the following enterprise funds as major funds in the accompanying financial statements:
WATER UTILITY FUND is used to account for activity related to providing water service to the community.
SANITATION DISTRICT FUND is used to account for activity related to providing residents with sanitary sewer services.
38
The City also reports the following fund types:
Internal Service Funds - These funds account for motor vehicles, central services, telephone, building maintenance, information services, self-i nsurance and pension bond payments. All of these services are provided to other departments on a cost-reimbursement basis.
Fiduciary Funds - The Successor Agency to the Redevelopm ent Agency Private-Purpose Trust Fund accounts for the accumulation of resources to be used for payments at appropriate amounts and times in the future. Custodial Funds are used to account for assets held by the City for Billing Services and Supporters of Senior Center and monies held for an external investment pool for the San Mateo Pre- Hospital Emergency Medical Services Group, none of which are held in trust. In addition, The financial activities of these funds are excluded from the government-wide financial statements because they are not directly or indirectly governed by the City Council.
C. PROPERTY HELD FOR DEVELOPMENT
Property held for development is stated at the lower of historical cost or net realizable value (equal to agreed upon sales price if a disposition and development agreement has been reached with a developer).
D. BASIS OF ACCOUNTING
The government-wide, proprietary, and fiduciary fund financial statements are reported using the economic resources measurement focus and the full accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place.
Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The City considers all revenues reported in the governmental funds to be available if the revenues are collected within sixty days after year-end. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt, claims and judgments, and compensated absences, which are recogn ized as expenditures to the extent they have matured. Governmental capital asset acquisitions are reported as expenditures in governmental funds.
Proceeds of governmental long-term debt and acqui sitions under capital leases are reported as other financing sources.
In addition to assets, the statement of net position or balance sheet will report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then.
In addition to liabilities, the statement of net position or balance sheet will report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position or fund balan ce that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The City has one item, which arises only under a modified accrual basis of accounting, that qualifies for reporting in this category. Accordingly, the item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from loans. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available. 39
Property taxes and sales taxes are considered measurable and available when in the hands of intermediary collecting governments and are recognized as revenue at that time. The primary revenue sources which are susceptible to accrual include taxes, rents, licenses, interest, grants and contributions. Fines and penalties and other revenues are recorded as revenues when received in cash because they are generally not measurable until actually received.
The City may fund programs with a combination of cost-reimbursement grants, categorical block grants, and general revenues. Thus, both restricted and unr
estricted net position may be available to finance
program expenditures. The City’s policy is to first apply restricted grant resources to such programs, followed by general revenues if necessary.
Certain indirect costs are included in program expenses reported for individual functions and activities. Nonexchange transactions, in which the City gives or receives value without directly receiving or giving equal value in exchange, include taxes, grants, entitlements, and donations. On an accrual basis, revenue from taxes is recognized in the fiscal year for which the taxes are levied.
Revenue from grants, entitlements, and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.
E. BUDGETS, BUDGETARY ACCOUNTING AND ENCUMBRANCES
The City uses a biennial budget process whereby two individual annual budgets are adopted by City Council for all funds and component units other than the Custodial Funds. Budgets are subject to public hearing before they are adopted by the City Council. Budgets are prepared on the basis of generally accepted accounting principles (GAAP basis).
The City is not legally required to prepare budgets for any of its funds, but does so as a matter of managerial policy. Budgets submitted to the City Council include both proposed appropriations and the means of financing them. The City Council approves total appropriations on a departmental basis.
The City Manager is authorized and directed to make any changes or transfers of appropriations within any Department of the City and from one Department to another as deemed necessary or feasible, as long as the total appropriations of the funds are not exceeded. Additional appropriations not included in the original budget resolutions require approval by the City Council. Budgeted amounts shown are as adopted and amended by the City Council. Individual amendments were not material in relation to the original appropriations. Budgets for the City's proprietary funds are considered as memorandum budgets used for the purpose of management control. These nonappropriated budgets are not included in the Basic Financial Statements.
The City uses an encumbrance system as an extension of normal budgetary accounting. Under this system purchase orders, contracts and other commitments for the expenditure of monies are recorded to reserve that portion of applicable appropriations. Encumbrances outstanding at year-end are recorded as an assignment of fund equity since they do not constitute expenditures or liabilities.
Outstanding encumbrances at year end are automatically reappropriated the following year.
Unencumbered and unexpended appropriations for other than capital outlay lapse at year-end.
However, the Capital Projects Fund is not budgeted on a project-length basis. Only the budget estimated to be spent in the current fiscal year is appropriated, even if the project will continue into future fiscal years. The City prepares a ten year capital plan, and each project year budget (GAAP Basis) is appropriated separately on an on-going basis. 40
For the fiscal year ended June 30, 2021, the following expenditures exceeded the budgeted appropriations:
Expenditures
Exceeded Budget
Linda Vista Benefit Assessment Special Revenue Fund
Public Works $4,911
Sufficient resources were available within the fund to finance these excess amounts.
F. FAIR VALUE MEASUREMENTS
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The fair value hierarchy categorizes the inputs to valuation techniques used to measure fair value into three levels based on the extent to whic h inputs used in measuring fair value are observable in the market.
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 inputs are inputs, other than quoted prices included within level 1, that are observable for an asset or liability, either directly or indirectly.
Level 3 inputs are unobservable inputs for an asset or liability.
If the fair value of an asset or liability is measured using inputs from more than one level of the fair value hierarchy, the measurement is considered to be based on the lowest priority level input that is significant to the entire measurement.
G. CASH AND INVESTMENTS
The City’s investments are carried at fair value, as required by generally accepted accounting principles. The City adjusts the carrying value of its investments to reflect their fair value at each fiscal year end, and it includes the effects of these adjustments in income for that fiscal year.
The City pools cash from all sources and all funds, except restricted cash and cash and investments with fiscal agents, so the pool of funds can be inve sted consistent with goals for safety and liquidity, while maximizing yield. Cash is pooled so individual funds can make expenditures at any time.
Investment income is allocated among funds on th e basis of average daily cash and investment balances in each fund, unless there are specific legal or contractual requirements to do otherwise. 41
Cash and investments are classified in the financial statements as shown below, based on whether or not their use is restricted under the terms of City debt instruments or Agency agreements:
Cash and investments $204,298,877
Cash with fiscal agent 11,873
Restricted cash and investments 3,746,447
Cash and investments of the City 208,057,197
Cash and investments in Fiduciary Funds (separate statement):
Private-purpose Trust Fund 207,517
Custodial Funds 1,763,828
Custodial Funds - External investment pool 974,733
Total cash and investments $211,003,275
Investments Authorized by the California Government Code and the City’s Investment Policy The City’s Investment Policy and the California Go vernment Code allow the City to invest in the following, provided the credit ratings of the issuers are acceptable to the City and approved percentages an
d maturities are not exceeded. The following table also identifies certain provisions of the California Government Code, or the City’s Investment Policy where the City’s Investment Policy is more restrictive, that addresses interest rate risk, credit risk and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustee that are governed by the provisions of debt agreements of the City, rather than the general provisions of the California Government Code or the City’s Investment Policy.
Minimum Maximum Maximum
Maximum Credit in Investment
Authorized Investment Type Maturity Quality Portfolio In One Issuer U. S. Treasury Bonds, Notes and Bills or
Certificates of Indebtedness 5 Years N/A No Limit No Limit U.S. Government Agency Securities and
U.S. Government Sponsored Enterprise Agencies 5 Years * N/A No Limit No Limit State of California Local Agency
Investment Fund (LAIF Pool) Upon Demand N/A
$75,000,000
per account
$75,000,000
per account
San Mateo County Treasurer's Pool Upon Demand N/A No Limit No Limit State of California Treasury Notes or Bonds 5 Years A No Limit 5% California Local Agency Obligations 5 Years A 30% 5%
Bankers' Acceptances 180 Days N/A 40% 5%
Commercial Paper 270 Days A1/P1 25% 5%
Negotiable Certificates of Deposit 5 Years A 30% No Limit Non-Negotiable Certificates of Deposit 5 Years A 30% No Limit FDIC Insured/Collateralized Time Certificates of Deposit 5 Years N/A 30% 5% Money Market Mutual Funds Upon Demand AAAm 15% 5%
Passbook Savings Account None N/A No Limit No Limit
Repurchase Agreements 1 year N/A 15% 5%
Reverse Repurchase Agreements 92 Days N/A 15% 5%
* However, the City Council specifically grants the authority to the City Treasurer to invest a maximum of $14,000,000 of the City’s portfolio in Government National Mortgage Association securities which, at the time of investment, have terms remaining to maturity in excess of five years. 42
Public Agencies Post-Employment Trust
On May 22, 2017, the City Council adopted resolu tion 17-58 approving the adoption of the Public
Agencies Post-Employment Trust administered by Public Agency Retirement Services (PARS). The Trust is an irrevocable trust and qualifies as an Internal Revenue Section 115 Trust. This Trust will assist the City in mitigating the CalPERS contribution rate volatility. Investments of funds held in Trust are governed by the Investment Guideline Document for the investment account and by the agreement for administrative services with PARS, rather than the general provisions of the California Government Code of the City’s investment policy. The City elected a discretionary in vestment approach which allows the City to maintain oversight of the inve stment management, control on target yield and the portfolio’ risk of tolerance, under the Moderately Conservative Index PLUS investment option. The assets in the Trust will eventually be used to fund pension plan obligations.
Investments Authorized by Debt Agreements
The City must maintain required amounts of cash an d investments with trustees or fiscal agents under the terms of certain debt issues. These funds are unexpended bond proceeds or are pledged as reserves to be used if the City fails to meet its obligations under these debt issues. The California Government Code requires these funds to be invested in accordan ce with City ordinance, bond indentures or State statute.
The following table identifies the investment types th at are authorized for investments held by fiscal agents. The table also identifies certain provisions of these debt agreements:
M in imu m Maximu m Maximu m
Max im um Credit In Investm ent
Authorized Investment Type Maturity Quality Portfolio In One Issuer U. S. Treasury Bonds, Notes and Bills N/A N/A No Lim it No Lim it U.S. G overnment Agency Securities
U.S. G overnm ent Sponsored N/A AAA No Lim it No Lim it State Obligations
N/A
Highest Rating
Category No Limit No Limit
Co mmercial Pap er 270 Day s A No Limit No Limit
Negotiable Certificates of Deposit 365 days A-1+ No Limit No Limit Money Market Mutual Funds N/A AAAm No Lim it No Lim it
Bankers Acceptances 360 days A-1+ No Limit No Limit
Local Obligations
N/A
Highest Rating
Category No Limit No Limit
State of California Local Agency
Investm ent Fund (LAIF Pool) Upon Dem and N/A No Lim it No Lim it Municipal Obligations N/A AAA No Lim it No Lim it
Repurchase Agreements N/A A No Limit No Limit
Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Normally, the longer the maturity of an investment the greater the sensitivity of its fair value to changes in market interest rates.
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Information about the sensitivity of the fair values of the City’s cash and investments (including investments held by bond trustees) to market interest rate fluctuations is provided by the following table that shows the distribution of the City’s cash and investments by maturity:
Less than One to More than
Investment Type One Year Five Years Five Years Total
U.S. Government Agency Securities $1,094,548 $1,016,104 $684,482 $2,795,134 Money Market Mutual Funds 11,873 11,873
California Local Agency Investment Fund 21,268,668 21,268,668 San Mateo County Investment Pool 171,039,731 171,039,731 Negotiable Certificates of Deposit 5,011,215 5,011,215
PARS Moderately Conservative Index PLUS Fund 3,746,447 3,746,447 Total Investments $197,161,267 $6,027,319 $684,482 203,873,068 Cash in Bank and On Hand 7,130,207
Total Cash and Investments $211,003,275
The City is a participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. The City reports its investment in LAIF at the fair value amount provided by LAIF, which is the same as the value of the pool share. The balance is available for withdrawal on demand, and is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis. Each regular LAIF account is permitted to have up to 15 transactions per month, with a minimum transaction amount of $5,000, a maximum transaction amount of $75 million and at least 24 hours advance notice for withdrawals of $10 million or more. Bond proceeds accounts are subject to a one- time deposit with
no cap and are set up with a monthly draw down schedule. Included in LAIF’s investment portfolio are collateralized mortgage obligations, mortgage-b acked securities, other asset-backed securities, loans to certain state funds, United States Treasury Notes and Bills, and floating rate securities issued by federal agencies, government-sponsored enterprises, and corporations. At June 30, 2021, these investments have an average maturity of 291 days.
The City is a participant in the San Mateo County Investment Pool (SMCIP) that is regulated by California Government Code Section 53600 under the oversight of the Treasurer of the County of San Mateo. The City reports its investment in SMCIP at the fair value amount provided by SMCIP. The balance available for withdrawal is based on the accounting records maintained by SMCIP, which are recorded on an amortized cost basis. Included in SMCIP’s investment portfolio are U.S. Treasury Notes, obligations issued by agencies of the U.S. Government, LAIF, corporate notes, commercial paper, collateralized mortgage obligations, mortgage-backed securities, other asset-backed securities, and floating rate securities issued by federal agencies, government-sponsored enterprises, and corporations. At June 30, 2021, these investments matured in an average of 1.81 years.
Money Market Mutual Fund investments are available for withdrawal on demand.
Fair Value Investments
Generally accepted accounting principles require governments to present investments at fair value.
The City adjusts the carrying value of its investment to reflect the fair value at each fiscal year-end, and it includes the effect of this adjustment in income for that fiscal year. 44
Credit Risk
Credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. The actual ratings as of June 30, 2021 are provided by Standard and Poor’s except as noted.
Total
Investment Type AAAm AAm/AAf Investments
Money Market Mutual Funds $550 $11,323 $11,873
San Mateo County Investment Pool 171,039,731 171,039,731 Total $550 $171,051,054 171,051,604
Not rated:
U.S. Government Agency Securities 2,795,134
California Local Agency Investment Fund 21,268,668
Negotiable Certificates of Deposit 5,011,215
PARS Moderately Conservative Index PLUS Fund 3,746,447
Total Investments $203,873,068
Custodial Credit Risk
The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (for example, broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party.
The City’s investment policy requires that securities transactions be executed on a delivery vs. payment basis. Funds are not wire-transferred until s ecurities are delivered into safekeeping with the City's third party custodian. The custodial relationship is subject to an agreement for services which may be separate from the agreement for other banking services. The safekeeping requirement does not apply to securities which are physically delivered to the City.
Fair Value Hierarchy
The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The fair value hierarchy, which has three levels, is based on the valuation inputs used to measure an asset’s fair value. The following provides a summary of the hierarchy used to measure fair value:
Level 1 - Quoted prices in active markets for identical assets that the City has the ability to access at the measurement date. Level 1 assets may include debt and equity securities that are traded in an active exchange market and that are highly liquid and are actively traded in over-the-counter markets.
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Level 2 - Observable inputs other than Level 1 prices such as quoted prices for similar assets in active markets, quoted prices for identical or similar assets in markets that are not active, or other inputs that are observable, such as interest rates and curves observable at commonly quoted intervals, implied volatilities, and credit spreads. For financial reporting purposes, if an asset has a specified term, a Le vel 2 input is required to be observable for substantially the full term of the asset.
Level 3 - Unobservable inputs should be developed using the best information available under the circumstances, which might include the City’s own data. The City should adjust that data if reasonable available information indicates that other market participants would use different data or certain circumstances specific to the City are not available to other market participants.
The following is a summary of the fair value hierarchy of the fair value of investments of the City as of June 30, 2021:
Investment Type Level 2 Total
Investments by Fair Value Level:
U.S. Government Agency Securities $2,795,134 $2,795,134 Negotiable Certificates of Deposit 5,011,215 5,011,215
Subtotal $7,806,349 7,806,349
Investments Measured at Amortized Cost:
Money Market Mutual Funds 11,873
PARS Moderately Conservative Index PLUS Fund 3,746,447
Investments Not Subject to the Fair Value Hierarchy:
California Local Agency Investment Fund 21,268,668
San Mateo County Investment Pool 171,039,731
Total Investments $203,873,068
All investments classified in Level 2 were valued using prices provided by the City’s custodian bank.
H. INVENTORY AND PREPAIDS
Inventory is valued at cost, using the first-in, first-out method. For the General Fund, inventories consist of consumable supplies, and do not constitute available spendable resources, even though they are a component of net current assets. For proprietary funds, inventories represent materials and supplies for operations. The consumption method of accounting is applied to inventories.
Prepaids represent services that are paid for in advance. For governmental funds, prepaids do not constitute available spendable resources even though they are a component of net current assets. The consumption method of accounting is applied to prepaids.
I. WATER UTILITY ACCOUNTS RECEIVABLE
The City bills usage to water utility customers on a bimonthly basis in arrears. At any given time, an average of one month's usage is unread and unbilled. These unbilled estimated usages have been recognized as revenue and receivables in the financial statements of the Water Utility enterprise fund. 46
J. ADVANCES TO OTHER FUNDS AND AGENCIES
Current portions of interfund loans receivable (reporte d in "due from" asset accounts) are considered available spendable resources.
K. ACCUMULATED UNPAID VACATION, COMPENSATORY AND SICK LEAVE Accumulated unpaid employee benefits are accrued at year-end. If vacation or compensatory leave is not taken by employees during their employment, the City is obligated to make cash payments to them on termination or retirement at the salary rates then in effect. City employees receive from thirteen to twenty-eight days of vacation each year.
Full-time City employees receive one working day of sick leave for each month of employment.
Employees who terminate for reasons other than death, retirement or abolishment of position lose all accumulated sick leave. Upon death, retirement after the age of 50 and 5 years of service or abolishment of position the City is obligated to pay 50% of unused sick leave, up to from 750 to 1,392 hours, depending on the bargaining unit, at the salary rate then in effect. The value of vested sick leave liability for all employees qualified for retirement on June 30 of each year is accrued.
The City’s liability for compensated absences is recorded in various governmental funds or proprietary funds as appropriate. The liability for compensa ted absences is determined annually. For all governmental funds, compensated absences are reported only if they are still outstanding following an employee’s resignation or retirement.
The changes in the liability for compensated absences were as follows:
Governmental
Activities
Business Type
Activities Total
Balance July 1, 2020 $10,279,959 $2,004,020 $12,283,979 Additions 6,252,675 1,303,128 7,555,803
Payments (4,301,803) (934,758) (5,236,561) Balance June 30, 2021 $12,230,831 $2,372,390 $14,603,221 Due within one year $5,393,920 $833,451 $6,227,371
Compensated absences are liquidated by the fund that has recorded the liability. Governmental activities compensated absences are liquidated primarily by the General Fund.
L. CLAIMS AND JUDGMENTS
The City has recognized a liability for workers' compensation and general liability claims in the Self-Insurance Internal Service Fund. This liability reflects the costs of claims determined to be probable of assertion and measurable in amount.
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M. PROPERTY TAX LEVY, COLLECTION, MAXIMUM RATES
Article 13 of the California State Constitution provides for a maximum general property tax rate statewide of $1.00 per $100 of assessed value, and may be adjusted by no more than two percent per year unless the property is sold or transferred, in which case it is then assessed at sales price. Assessed value is calculated at 100% of sales price as defined by the above referenced Article 13.
The State Legislature has determined the method of distribution of receipts from the $1.00 tax levy among the county, cities, school districts and other districts. Counties, cities and school districts may levy such additional tax rate as is necessary to provide for voter-approved debt service. San Mateo County assesses properties, bills for, and collects property taxes on the following schedule:
SECURED
UNSECURED
Valuation dates March 1 March 1
Lien/levy dates January 1 January 1
Due Dates 50% on November 1 July 1
50% on February 1
Delinquent as of December 10 August 31
April 10
The term "unsecured" refers to taxes on property not secured by liens on real property. Property taxes levied are recorded as revenue and receivables, ne t of estimated uncollectible amounts, in the fiscal year of levy. Property taxes which cannot be recorded as current year revenues, in accordance with the modified accrual basis of accounting, have been recorded as unearned revenues.
N. USE OF ESTIMATES
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
NOTE 2.
REPORTING ENTITY
The City's Basic Financial Statements include the financial activities of the City, the North San Mateo County Sanitation District, the Daly City Public Facilities Financing Corporation and the Daly City Housing Development Finance Agency. These entit ies are controlled by governing boards consisting of the City Council. Council members are financially accountable for these entities’ operations and approve fees, debt issues and adopt budgets.
The North San Mateo County Sanitation District became a subsidiary district of the City on July 1, 1985. The activities of the District are reported in the Sanitation District Enterprise Fund. The District does not issue separate financial statements.
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The activities of the Daly City Public Facilities Financing Corporation (Corporation) are included in the basic financial statements of the Water Utility Enterprise Fund in proportion to the activities carried out on its behalf because the City Council sits as the Board of this entity. The City established the Corporation to facilitate the issuance of Certificates of Participation, currently consisting of various expansion and upgrade projects in the Water Utility. The Corporation acts as a conduit for the leasing of the associated facilities of the utility in order to allow the issuance of its Certificates of Participation (See Note 5). The Corporation does not issue separate financial statements.
The activities of the Daly City Housing Developmen t Finance Agency (Finance Agency) are included in the Low and Moderate Income Housing Assets Special Revenue Fund. The City established the Finance Agency in 1985 pursuant to California Health and Safety Code (HSC) Division 24, Part 2, Chapter 1, to address the housing needs of the City and the Finance Agency serves as the Housing Successor to the former Daly City Redevelopment Agency. The primary activity of the Finance Agency is to develop nonsubsidized multifamily rental housing development financing pursuant to Section 34312.3 of the HSC that is owned, operated and managed by private and other agencies, not the Finance Agency. The Finance Agency is administered by a Governing Board whose members are the City Council of the City of Daly City, and the City also performs all accounting and administrative functions for the Finance Agency. The Finance Agency does not issue separate financial statements.
NOTE 3.
COMMITMENTS AND CONTINGENCIES
A. CONSTRUCTION CONTRACTS
At June 30, 2021, the City had made commitments of approximately $6.4 million for construction work, legal and consulting fees, and purchases of supplies and equipment.
B. LITIGATION
The City is subject to litigation arising in the normal course of business. In the opinion of the City Attorney, there is no pending litigation which is likely to have a material adverse effect on the financial position of the City.
C. ENCUMBRANCES
The City uses an encumbrance system as an extension of normal budgetary accounting for governmental funds. Under this system, purchase orders, contracts, and other commitments for the expenditure of monies are recorded in order to reserve that portion of applicable appropriations.
Encumbrances outstanding at year-end are recorded as restricted, committed or assigned fund balance, depending on the classification of the resources to be used to liquidate the encumbrance, since they do not constitute expenditures or liabilities. Outstanding encumbrances at year-end are automatically reappropriated for the following year. Unencumbered and unexpended appropriations lapse at year- end. Encumbrances outstanding as of June 30, 2021 were $375,051 in the General Fund, $1,404,606 in the Gas Tax Special Revenue Fund, $538,193 in the Grants Special Revenue Fund, $1,002,587 in the Capital Projects Fund, and $470,013 in nonmajor governmental funds. 49
D. FEDERAL AND STATE GRANT PROGRAMS
The City participates in Federal and State grant programs. These programs have been audited by the City’s independent accountants in accordance with the provisions of the Federal Single Audit Act as amended and applicable State requirements. No cost disallowances were proposed as a result of these audits. However, these programs are still subject to further examination by the grantors and the amount, if any, of expenditures which may be disallowed by the granting agencies cannot be determined at this time. The City expects such amounts, if any, to be immaterial.
E. COVID‐19 GLOBAL PANDEMIC
On March 11, 2020, the World Health Organization declared the novel strain of coronavirus (COVID- 19) a global pandemic and recommended containment and mitigation measures worldwide. The COVID-19 outbreak in the United States has caused business disruption through mandated and voluntary closings of businesses and shelter in place orders for all but those deemed essential services.
While the business disruption is currently expected to be temporary, there is considerable uncertainty around the duration of the closings and shelter in place orders. Although many of the City's services are considered essential, City Hall was closed to the public, certain other services transitioned to online-only and because the City's major revenue sources, including businesses that collect sales taxes and transient occupancy taxes, are directly impacted by these events, it is probable that this matter will negatively impact the City. However, the ultimate financial impact and duration cannot be reasonably estimated at this time.
NOTE 4.
CAPITAL ASSETS
All capital assets are valued at historical cost or estimated historical cost if actual historical cost is not available. Donated capital assets, donated works of art and similar items, and capital assets received in a service concession arrangement are reported at acqui sition value. The City’s policy is to capitalize all assets with costs exceeding $25,000 for all classes of capital assets with useful lives exceeding two years. Prior to July 2020, the City’s policy was to capitalize costs exceeding $25,000 for infrastructure and $5,000 for all other classes of capital assets.
The City depreciates capital assets over their estimated useful lives. Th e purpose of depreciation is to
spread the cost of capital assets equitably among all users over the life of these assets. The amount charged to depreciation expense each year represents that year’s pro rata share of the cost of capital assets.
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Depreciation is calculated using the straight-line method, which means the cost of the asset is divided by its expected useful life in years and the result is charged to expens e each year until the asset is fully depreciated. The City has assigned the useful lives listed below to capital assets:
Buildings and Improvements 20-50 years Sewage Collection Facilities 10-50 years Streets and Infrastructure 20-60 years Sewage Disposal and Treatment Facilities
15-50 years
Park Structures and Improvements 10-30 years Sanitation Subsurface Lines and Water Mains
25 years
Vehicles, Equipment, Furniture
and Fixtures
5-20 years Wells and Pump Stations 40-50 years
Water Reservoirs 40-99 years
The City capitalizes major asset purchases and improvements which increase the useful life of the related assets. Minor purchases and routine repair and maintenance costs are charged directly to expense.
Major outlays for capital assets and improvements are capitalized as pr ojects are constructed. Interest incurred during the construction phase is reflected in the capitalized value of the asset constructed, net of interest earned on the invested proceeds over the same period.
A. CAPITAL ASSET ADDITIONS AND RETIREMENTS
Capital assets at June 30 comprise:
Balance Balance
June 30, 2020 Additions Retirements Transfers June 30, 2021 Governmental activities:
Capital assets not being depreciated:
Land $33,029,342 ($5,172,856) $27,856,486
Construction in progress 16,720,958 $5,931,162 ($6,268,315) 16,383,805 Total capital assets not being depreciated 49,750,300 5,931,1 62 (5,172,856) (6,268,315) 44,240,291 Capital assets being depreciated:
Buildings & improvements 57,824,402 (97,811) 1,500,000 59,226,591 Streets & infrastructure 82,277,257 1,379,985 1,569,133 85,226,375 Park structures & improvements 8,111,835 (81,764) 8,030,071 Vehicles & equipment 26,072,587 626,293 (423,811) 3,199,182 29,474,251 Furniture & fixtures 458,590 458,590
Total capital assets being depreciated 174,744,671 2,006,278 (603,386) 6,268,315 182,415,878 Less accumulated depreciation for:
Buildings & improvements 35,788,875 1,485,374 (97,811) 37,176,438 Streets & infrastructure 61,785,032 2,216,722 64,001,754 Park structures & improvements 4,195,308 352,645 (49,285) 4,498,668 Vehicles & equipment 20,703,482 1,178,270 (420,620) 21,461,132 Furniture & fixtures 435,326 2,829 438,155
Total accumulated depreciation 122,908,023 5,235,840 (567,716) 127,576,147 Net depreciable assets 51,836,648 (3,229,562) (35,670) 6,268,315 54,839,731 Governmental activity capital assets, net $101,586,948 $2,701,600 ($5,208,526) $99,080,022 51
Balance Balance
June 30, 2020 Additions Retirements Transfers June 30, 2021 Business-type activities:
Capital assets not being depreciated:
Land $2,862,549 $2,862,549
Construction in progress 9,109,560 $1,401,010 ($1,517,002) 8,993,568 Total capital assets not being depreciated 11,972,109 1,401,010 (1,517,002) 11,856,117 Capital assets being depreciated:
Buildings & improvements 7,918,904 7,918,904
Sewage facilities 59,021,605 59,021,605
Mains & subsurface lines 46,428,933 1,517,002 47,945,935 Water reservoirs 12,715,925 12,715,925
Wells & pump stations 9,074,783 9,074,783
Equipment 16,482,642 506,996 16,989,638
Furniture & fixtures 151,328 151,328
Total capital assets being depreciated 151,794,120 506, 996 1,517,002 153,818,118 Less accumulated depreciation for:
Buildings & improvements 6,113,605 166,400 6,280,005
Sewage facilities 39,796,626 1,172,361 40,968,987
Mains & subsurface lines 24,531,199 1,516,441 26,047,640 Water reservoirs 5,705,850 159,294 5,865,144
Wells & pump stations 4,512,884 190,172 4,703,056
Equipment 12,081,741 631,450 12,713,191
Furniture & fixtures 94,055 7,319 101,374
Total accumulated depreciation 92,835,960 3,843,437 96,679,397 Net depreciable assets 58,958,160 (3,336,441) 1,517,002 57,138,721 Business-type activity capital assets , net $70,930,269 ($1, 935,431) $68,994,838 B. CAPITAL ASSET CONTRIBUTIONS
Some capital assets may be acquired using federal and state grant funds, or they may be contributed by developers or other governments. These contributi ons are accounted for as revenues at the time the capital assets are contributed.
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C. DEPRECIATION ALLOCATION
Depreciation expense is charged to functions and pr ograms based on the usage of the related assets.
The amounts al
located to each function or program are as follows:
Governmental Activities
General government $122,063
Public safety 390,957
Public works 2,267,078
Culture and recreation 1,555,381
Capital assets held by the City's internal service
funds charged to the various functions based on
their usage of the assets 900,361
Total Governmental Activities $5,235,840
Business-Type Activities
Water Utility $1,184,182
Sanitation District 2,468,562
Civic Center 190,693
Total Business-Type Activities $3,843,437
NOTE 5.
LONG-TERM DEBT
Changes in Long-Term Debt for the fiscal year ended June 30, 2021, are as follows:
Original Issue Balance Balance Current
Amount June 30, 2020 Additions Retirements June 30, 2021 Portion Governmental Activities Debt
Housing & Urban Development Section 108 Loan
0.35%-2.49%, due FY 2023 (Direct Borrowing) $4,500,000 $1,173,000 $365,000 $808,000 $390,000 2004 Series A-1 Pension Obligation Bonds
2.650%-5.896%, due FY 2024 36,235,000 15,025,000 3,215,000 11,810,000 3,560,000 Community First National Bank Lease-Fire Pumpers
2.670%, due FY 2028 1,483,056 $1,483,056 1,483,056 195,490 Total Governmental Activities 16,198,000 1,483,056 3,580,000 14,101,056 4,145,490 Business-Type Activities Debt
State Water Resources Control Board Loan
2.5%, due FY 2025 (Direct Borrowing) 4,450,128 1,342,080 255,326 1,086,754 261,709 2012 Water Revenue Refunding Bond
2.0%-3.0%, due FY 2024 6,890,000 2,480,000 600,000 1,880,000 615,000 Total Business-Type Activities 3,822,080 855,326 2,966,754 876,709 Total City Long-Term Debt $20,020,080 $4,435,326 $17,067,810 $5,022,199 53
During fiscal 2004, the City entered into a $4,500,000 note payable agreement guaranteed under the Department of Housing and Urban Development’s (HUD) Section 108 Loan Guarantee Program.
Proceeds from the note were used to finance the design and construction of the Bayshore Community Center. Principal payments are due annually on August 1; interest payments are due semi-annually on August 1 and February 1. Debt service is payable from future Federal Block Grant monies. The City has pledged certain future grants revenue under Section 106 and Section 108(q) for which the City may become eligible and program income generated directly from the use of the loan funds to repay the note. On April 27, 2015, the City refinanced the outstanding principal balance of the loan of $2,670,000 in order to obtain a lower interest rate. The City realized an interest savings of approximately $384,328. As of June 30, 2021, total principal and interest remaining on the note is $827,945. For fiscal year 2021, principal and interest paid were $388,020 and total block grant revenues were $994,785.
On June 1, 2004, the City, through the California Statewide Communities Development Authority, issued $36,235,000 of Taxable Pension Obligation Bonds, Series A-1, to prepay the City’s unfunded PERS accrued actuarial liability of $35,600,000. The City’s outstanding debt under the Taxable Pension Obligation Bonds is unsecured, however it is subject to mandatory sinking fund contributions each year beginning June 1, 2017 for the current year principal amount. Events of default include non- payment of interest or principal when due. The City shall have 60 days to cure any default. There have been no events of default since the Bonds were issue d. Principal is due annually on June 1 and interest is due semiannually on June 1 and December 1, through June 1, 2024. Debt service is payable from available City resources. For fiscal year 2021, principal and interest paid were $4,100,874.
On December 18, 2020, the City entered into a lease agreement in the amount of $1,483,056 with Community First National Bank, to acquire two fire
pumpers. Events of default on the lease include
non-payment of principal and interest when due. A penalty of 10% per year of the amount due will be added on all amount due, and, after five days written notice, the lessor has the right to take possession of the equipment. There have been no events of default since the lease was issued. Principal and interest are due annually starting on December 18, 2021, with annual payments of $235,088 through 2027. The lease bears an interest rate of 2.670%.
On November 18, 2003, the City received a loan in the amount of $4,450,128, plus accrued interest, from the California State Water Resources Control Board. Proceeds from the loan were used for construction of tertiary treatment facilities and distribution pipelines in the City’s Sanitation District.
Principal and interest are due annually on December 1 through December 1, 2024. As long as the loan is outstanding, the City has pledged the Sanitation District Enterprise Fund revenues, net of the operations and maintenance expenses, but excluding depreciation, as defined in the loan agreement.
The City’s outstanding debt under the California State Water Resources Control Board are secured by a pledge of net revenues as previously defined. Even ts of default include non-payment of interest or principal when due. The City shall have 10 days to cure any default. A penalty of one-tenth of one percent (0.1%) of the amount due will be added for each day of nonpayment. There have been no events of default since the loan was issued. As of June 30, 2021, total principal and interest remaining on the note is $1,155,517. For fiscal year 2021, principal and interest paid were $288,878 and total Sanitation District Enterprise net revenues were $38,348. 54
On September 10, 2012, the City authorized the sale of $6,890,000 of 2012 Water Revenue Refunding Bonds to refinance the outstanding balance of the 2004 Certificates of Participation. Principal payments are due annually on June 1 and interest is due semiannually on June 1 and December 1, commencing June 1, 2013, through June 1, 2024. The City has pledged Water Utility Enterprise Fund revenues, net of the operations and maintenance expenses but excluding depreciation, for debt service, as defined in the indenture. The City’s outstanding debt under the Water Revenue Refunding Bonds is secured by a pledge of net revenues as previously defined. Events of default include non-payment of interest or principal when due, or failing to maintain a debt coverage ratio of at least 1.00. The Trustee of the Bonds shall immediately notify the City upon the occurrence and during the continuance of any default. The City has 60 days to correct any defa ult. The Trustee may declare the Bonds to become immediately due and payable if the City is unable to cure the default. Prior to any judgment or decree for the payment of the amount due has been obtained or entered, the City shall deposit with the Trustee a sum sufficient to pay all matured principal and unpaid interest prior to the default declaration, with a 10% interest rate per annum on the outstanding amount, to cure the default. There have been no events of default since the Bonds we re issued. As of June 30, 2021, total principal and interest remaining on the bonds is $1,955,700. For fiscal year 2021, principal and interest paid were $649,600 and total Water Utility Enterprise Fund net revenues were $8,422,910.
Annual debt service requirements are shown below for all long-term debt with specified repayment terms:
HUD Section 108 Loan Pension Obligation Bonds Fire Apparatus Pumpers Lease Y ear ending June 30 Principal Interest Principal Interest Principal Interest Principal Interest 2022 $390,000 $14,824 $3,560,000 $696,318 $195,490 $39,598 $4,145,490 $750,740 2023 418,000 5,121 3,925,000 486,420 200,710 34,378 4,543,710 525,919 2024 4,325,000 255,002 206,069 29,019 4,531,069 284,021 2025 211,571 23,517 211,571 23,517
2026 217,220 17,868 217,220 17,868
2027 - 2028 451,996 18,181 451,996 18,181
$808,000 $19,945 $11,810,000 $1,437,740 $1,483,056 $162,561 $14,101,056 $1,620,246 G overnm ental Activities
Total
Business-Type Activities
SWRCB Loan Water Revenue Refunding Bond
Y ear ending June 30 Principal Interest Principal Interest Principal Interest 2022 $261,709 $27,169 $615,000 $37,600 $876,709 $64,769 2023 268,253 20,626 625,000 25,300 893,253 45,926
2024 274,959 13,920 640,000 12,800 914,959 26,720
2025 281,833 7,048 281,833 7,048
$1,086,754 $68,763 $1,880,000 $75,700 $2,966,754 $144,463 Total
The City is subject to a debt limit that is 3.75% of the total assessed value of property, net of exempt real property. At June 30, 2021 that amount was $518,615,948. As of June 30, 2021, the City did not have any outstanding debt applicable to the limit.
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CONDUIT DEBT
The Finance Agency has assisted private-sector entities by sponsoring their issuance of debt for purposes the City deems to be in the public interest. These debt issues are secured solely by the property financed by the debt. The City and Finance Agency are not legally or morally obligated to pay these debts or be the purchaser of last resort of any foreclosed properties secured by these debts, nor is it obligated to advance City or Finance Agency funds to repay these debts in the event of default by any of these issuers. At June 30, 2021, the balance of this issuers’ outstanding debt was as follows:
Franciscan Moblie Home Park Acquisition Project:
Senior Revenue Refunding Bonds, Series 2007A $39,030,000 Subordinate Revenue Refunding Bonds, Series 2007B 4,525,000 Third Tier Revenue Refunding Bonds, Series 2007C 7,200,000 NOTE 6.
CURRENT INTERFUND BALANCES
Current interfund balances arise in the normal cour se of business and are expected to be repaid shortly after the end of the fiscal year. The purpos e of these interfunds was to cover deficit cash in receiving funds. At June 30, 2021, Community Block Grant Special Revenue Fund owed the General Fund $241,028.
INTERFUND ADVANCE
On November 13, 2018, the City Council authorized an appropriation of $5,000,000 to maintain water utility operating fund or capital fund reserve balances in compliance with City policy or to fund water utility capital improvement or maintenance projects included in the City’s then current Capital Improvement Plan. Funding for this project was pr ovided by an advance from the Sanitation District Enterprise Fund to the Water Utility Enterprise Fund. The loan and all accrued interest is repayable on or before June 30, 2023, beginning on July 1, 2021, and the loan bears interest at the end of each fiscal year at the quarterly LAIF rate. At June 30, 2021, the balance of the advance was $5,097,520, including accrued interest.
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INTERFUND TRANSFERS
Transfers between funds during the fiscal year ended June 30, 2021 were as follows:
Fund Making Transfer Fund Receiving Transfer Transfer Amount General Fund Gas Tax Special Revenue Fund $3,706,121
Capital Projects Fund 4,343,287
Non Major Governmental Funds 228,500
Internal Service Fund - Motor Vehicles 158,711
Internal Service Fund - Central Services 42,104
Internal Service Fund - Information Systems 11,642
Gas Tax Special Revenue Fund General Fund 350,424
Capital Projects Fund 489,880
Capital Projects Fund Gas Tax Special Revenue Fund 1,614,971 Internal Service Fund - Information Systems 46,439
Water Utility Enterprise Fund General Fund 938,460
Sanitation District Enterprise Fund 1,665,541
Sanitation District Enterprise Fund General Fund 1,195,487 Internal Service Fund - Information Services 6,500
Non Major Enterprise Fund General Fund 172,444
Internal Service Fund - Motor Vehicles General Fund 78,168 Internal Service Fund - Central Services General Fund 11,197 Internal Service Fund - PBX General Fund 12,779
Internal Service Fund - Building Maintenance General Fund 129,605 Internal Service Fund - Information Services General Fund 220,617 Water Utility Enterprise Fund 30,833
Internal Service Fund - Self-Insurance General Fund 221,046 $15,674,756
The purpose of the majority of transfers is to provide general support to another fund. General Fund transfers out typically represent an operating subsidy or in the case of grants, a match of another fund’s expenditures.
INTERNAL BALANCES
Internal balances are presented in the governmental-wide financial statements only. They represent the net interfund receivables and payables remaining after the elimination of all such balances within governmental and business-type activities.
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NOTE 7.
RETIREMENT PLAN
A. GENERAL INFORMATION ABOUT THE PENSION PLANS
Plan Descriptions – All qualified permanent and probationary employees are eligible to participate in the City’s separate Safety (police and fire) and Miscellaneous (all other) Plans, agent multiple- employer defined benefit pension plans administere d by the California Public Employees’ Retirement System (CalPERS), which acts as a common investme nt and administrative agent for its participating member employers. Benefit provisions under the Plans are established by State statute and City resolution. CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.
Benefits Provided – CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries.
Benefits are based on years of credited service, equal to one year of full time employment. Members with five years of total service are eligible to re tire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied as specified by the Public Employees’ Retirement Law.
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The Plans’
provisions and benefits in effect at June 30, 2021, are summarized as follows:
Miscellaneous
Hire date
Prior to
January 1, 2013
On or after
January 1, 2013
Benefit formula 3% @ 60 2% @ 62
B enefi t vesti ng schedul e 5 years servi ce 5 years servi ce Benefit paym ents m onthly for life m onthly for life
Retirement age 50-60 52-67
Monthly benefits, as a % of eligible com pensation 2.0%-3.0% 1.0%-2.5% Required em ployee contribution rates 8.00% 6.50%
Required employer contribution rates 13.154% * 13.154% * Required Unfunded Accrued Liability Contribution $5,761,949 *Effective February 15, 2014, members in the Teamsters Local 856 Public Safety Dispatchers and Police Assistants were required to pay an additional 5.41% for their share of pension costs and members in the Teamsters Local 856 Clerical/Technical unit pay an additional 5.51% for their share of pension costs.
Safety
Hire date
Prior to
January 1, 2013
On or after
January 1, 2013
Benefit formula 3% @ 55 2.7% @ 57
B enefi t vesti ng schedul e 5 years servi ce 5 years servi ce Benefit paym ents m onthly for life m onthly for life
Retirement age 50-55 50-57
Monthly benefits, as a % of eligible com pensation 2.4%-3.0% 2.0%-2.7% Required em ployee contribution rates 9.00% 11.50%
Required employer contribution rates 18.282% * 18.282% * Required Unfunded Accrued Liability Contribution $6,677,252 *Effective July 11, 2020, members in the Daly City Police Officers Association and Daly City Police Managem ent Bargaining Unit were required to pay an additional 3.0% for their share of pension costs.
Beginning in fiscal year 2016, CalPERS collects employer contributions for each Plan as a percentage of payroll for the normal cost portion as noted in the rates above and as a dollar amount for contributions toward the unfunded liability (UAL).
The dollar amounts are billed on a monthly basis,
or the City can elect to make a lump-sum payment at the beginning of the fiscal year. The City’s required contributions for the unfunded liability in the Miscellaneous and Safety Plans for the year ended June 30, 2021 were $5,761,949 and $6,677,252, respectively, which were made under the lump- sum payment option.
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Employees Covered – The following employees were covered by the benefit terms for each Plan as of the most recent actuarial valuation date of June 30, 2019 and measurement date of June 30, 2020:
Miscellaneous Safety
Inactive employees or beneficiaries currently receiving benefits 517 326 Inactive employees entitled to but not yet receiving benefits 394 100 Active employees 280 156
Total 1,191 582
Contributions – Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. Funding contributions for both Plans are determined annually on an actuarial basis as of June 30 by CalPERS.
The actuarially determined rate is the estimated am ount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the diffe rence between the actuarially determined rate and the contribution rate of employees.
The City’s Contributions to the Plans for the year ended June 30, 2021 were $8,901,914 for the Miscellaneous Plan and $10,620,215 for the Safety Plan.
B.
NET PENSION LIABILITY
The City’s net pension liability for each Plan is measured as the total pension liability, less the pension plan’s fiduciary net position. The net pension liability of each Plan is measured as of June 30, 2020, using an annual actuarial valuation as of June 30, 2019 rolled forward to June 30, 2020 using standard update procedures. A summary of principal assumptions and methods used to determine the net pension liability is shown below.
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Actuarial Assumptions – The total pension liabilities in the June 30, 2019 actuarial valuations were determined using the following actuarial assumptions:
Valuation Date June 30, 2019
Measurement Date June 30, 2020
Actuarial Cost Method Entry-Age Normal Cost Method
Actuarial Assum ptions:
Discount Rate 7.15%
Inflation 2.50%
Payroll Growth 2.75%
Projected Salary Increase V aries by Entry Age and Service Investment Rate of Return 7.15% (1)
Mortality Derived using CalPERS Membership Data for all Funds (2) Post Retirement Benefit Increase
The lesser of contract COLA or 2.50% until Purchasing
Protection Allowance floor on purchasing power applies,
2.50% thereafter
(1) Net of pension plan investm ent ex penses, including inflation (2) The mortality table used was developed based on CalPERS' specific data. The probabilities of mortality are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. Pre- retirement and post-retirement mortality rates include 15 years of projected mortality improvement using 90% of Scale MP-2016 published by the Society of Actuaries. For more details on this table, please refer to the CalPERS Ex perience Study and Review of Actuarial Assumptions report from December 2017 that can be found on the CalPERS website.
The underlying mortality assumptions and all other actuarial assumptions used in the June 30, 2019 valuation were based on the results of a December 2017 actuarial experience study for the period 1997 to 2015. Further details of the Experience Study can be found on the CalPERS website at www.calpers.ca.gov.
Discount Rate – The discount rate used to measure the total pension liability for each Plan was 7.15%.
The projection of cash flows used to determine the discount rate for each Plan assumed that contributions from all plan members in the Public Employees Retirement Fund (PERF) will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determine d. Based on those assumptions, each Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members for all plans in the PERF. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability for each Plan.
The long-term expected rate of return on pension plan investments was determined using a building- block method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. 61
In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectations as well as the expected pension fund cash flows. Using historical returns of all the funds’ asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11+ years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equal to the single equivalent rate calculated above and adjusted to account for assumed administrative expenses.
The table below reflects the long-term expected real rates of return by asset class.
Asset C lass (a)
New Strategic
Allocation
Real Return
Years 1 - 10 (b)
Real Return
Y ears 11+ (c)
G lobal Equity 50.0% 4.80% 5.98%
Fixed Income 28.0% 1.00% 2.62%
Inflation Assets 0.0% 0.77% 1.81%
Private Equity 8.0% 6.30% 7.23%
Real Assets 13.0% 3.75% 4.93%
Liquidity 1.0% 0.00% -0.92%
Total 100.0%
(a) In the CalPERS Com prehensive Annual Financial Report, Fix ed Incom e is included in G lobal Debt Securities; Liquidity is included in Short-term Investm ents; Inflation Assets are included in both G lobal Equity Securities and G lobal Debt Securities. (b) An ex pected inflation of 2.0% used for this period. (c) An ex pected inflation of 2.92% used for this period. 62
C. CHANGES IN THE NET PENSION LIABILITY
The changes in the Net Pension Liability for each Plan follow:
Miscellaneous Plan:
Increase (Decrease)
Total Pens ion
Liability
Plan Fiduciary
Net Position
Net Pension
Liability/(As s et)
Balance at June 30, 2019 (M easurement Date) $332,540,524 $261,721,857 $70,818,667 Changes in the year:
Service cost 4,734,206 4,734,206
Interes t on the total pens ion liability 23,372,961 23,372,961 Differences between actual and expected experience 432,569 432,569 Plan to Plan Resource Movem ent
Contributions - employer 8,214,918 (8,214,918)
Contributions - employees 2,252,506 (2,252,506)
Net investment income 12,936,801 (12,936,801)
Benefit paym ents, including refunds of em ployee
contributions (16,891,285) (16,891,285)
Other Miscellaneous Ex pense
Adm inistrative Ex pense (368,964) 368,964
Net changes 11,648,451 6,143,976 5,504,475
Balance at June 30, 2020 (M easurement Date) $344,188,975 $267,865,833 $76,323,142 Safety Plan:
Increase (Decrease)
Total Pens ion
Liability
Plan Fiduciary
Net Position
Net Pension
Liability/(As s et)
Balance at June 30, 2019 (M easurement Date) $349,529,705 $247,704,819 $101,824,886 Changes in the year:
Service cost 5,837,397 5,837,397
Interes t on the total pens ion liability 24,739,728 24,739,728 Changes in assum ptions
Differences between actual and expected experience 3,245,246 3,245,246 Plan to Plan Resource Movem ent
Contributions - employer 9,741,720 (9,741,720)
Contributions - employees 2,186,070 (2,186,070)
Net investment income 12,209,629 (12,209,629)
Benefit paym ents, including refunds of em ployee
contributions (19,366,927) (19,366,927)
Other Miscellaneous Ex pense
Adm inistrative Ex pense (349,203) 349,203
Net changes 14,455,444 4,421,289 10,034,155
Balance at June 30, 2020 (M easurement Date) $363,985,149 $252,126,108 $111,859,041 TOTAL - BOTH PLANS $708,174,124 $519,991,941 $188,182,183
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Sensitivity of the Net Pension Liability to Changes in the Discount Rate – The following presents the net pension liability of the City for each Plan, calcula ted using the discount rate for each Plan, as well as what the City’s net pension liability would be if it were calculated using a discount rate that is 1- percentage point lower or 1-percentage point higher than the current rate:
Miscellaneous Safety Total
1% Decrease 6.15% 6.15% 6.15%
Net Pension Liability $120,576,370 $157,624,486 $278,200,856 Current Discount Rate 7.15% 7.15% 7.15%
Net Pension Liability $76,323,142 $111,859,041 $188,182,183 1% Increase 8.15% 8.15% 8.15%
Net Pension Liability $39,647,885 $73,834,911 $113,482,796 Pension Plan Fiduciary Net Position – Detailed information about each pension plan’s fiduciary net position is available in the separately issued CalPERS financial reports.
D. PENSION EXPENSE AND DEFERRED OUTFLOWS/INFLOWS OF RESOURCES
RELATED TO PENSIONS
Pension expense is the change in net pension liability from the previous fiscal year to the current fiscal year less adjustments. Deferred outflows and deferre d inflows of resources related to pensions are certain changes in total pension liabilities and fiduciary net position that are to be recognized in future pension expense. For the year ended June 30, 2021 the City recognized pension expense of $11,293,779 for the Miscellaneous Plan and $40,758,954 for the Safety Plan, for total pension expense of $40,758,954. At June 30, 2021, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
Miscellaneous Plan:
Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contributions subsequent to measurement date $8,901,914 Differences between actual and expected experience 898,745 Changes in assum ptions - -
Net differences between projected and actual earnings on plan investments 2,200,439 -
Total $12,001,098
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Safety Plan:
Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contributions subsequent to measurement date $10,620,215 Differences between actual and ex pected ex perience 4,871,723 ($31,551) C hanges i n assum pti ons - (20,416)
Net differences between projected and actual earnings on plan investments 2,041,886
Total $17,533,824 ($51,967)
Total Miscellaneous and Safety Plans $29,534,922 ($51,967) The amount of $19,522,129 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2021. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:
Y ear Ended
June 30 Miscellaneous Plan Safety Plan Total
2022 ($153,419) $2,371,103 $2,217,684
2023 784,695 1,960,863 2,745,558
2024 1,365,704 1,491,171 2,856,875
2025 1,102,204 1,038,505 2,140,709
Annual Am ortization
E. SUBSEQUENT EVENT - REDUCTION OF CALPERS DISCOUNT RATE In July 2021, CalPERS reported a preliminary 21.3% net return on investments for the 12-month period that ended June 30, 2021. Under the Funding Risk Mitigation Policy, approved by the CalPERS Board of Administration in 2015, the 21.3% net return will trigger a reduction in the discount rate used to calculate employer and Public Employees' Pension Reform Act (PEPRA) member contributions. The Funding Risk Mitigation Policy seeks to reduce CalPERS funding risk over time, in which CalPERS investment performance that significantly outperforms the discount rate will trigger adjustments to the discount rate, expected investment return, and strategic asset allocation targets. This is the first time it has been triggered. The discount rate, or assumed rate of return, will drop to 6.8%, from its current level of 7%.
Based on these preliminary fiscal year returns, the CalPERS has announced the funded status of the overall Public Employees Retirement Fund (PERF) is an estimated 82%. This estimate is based on a 7% discount rate. Under the new 6.8% discount rate, however, CalPERS indicated the funded status of the overall PERF drops to 80%. This is because existing assets are assumed to grow at a slightly slower rate annually into the future. As intended
under the Funding Risk Mitigation Policy, the lower
discount rate increases the likelihood that CalPERS can reach its target over the longer term. The CalPERS Board of Administration will continue to review the discount rate through its Asset Liability Management process during the rest of the calendar year. 65
CalPERS' final fiscal year 2021 investment performance will be calculated based on audited figures and will be reflected in contribution levels for contracting cities, counties, and special districts in fiscal year 2024.
NOTE 8.
POST EMPLOYMENT BENEFITS OTHER THAN PENSION
The City provides certain health care benefits for employees who retire directly from the City with at least five years of service with the City and wh o are vested in the California Public Employees Retirement System (CalPERS). The City participates in the CalPERS health care plan which is governed under the California Public Employees H ealth and Medical Care Act (PEHMCA). Required retiree medical plan contributions are also governed by PEHMCA for member agencies. The City joined the California Employers' Retiree Benefit Tr ust (CERBT), an agent multiple-employer plan administered by CALPERS, consisting of an aggregation of single-employer plans. The CERBT issues a publicly available financial report that includes financial statements and required supplementary information. That report may be obtained from the California Public Employees' Retirement System, CERBT, P.O. Box 942703, Sacramento, CA 94229-2703.
The City contributes up to a fixed dollar amount for retiree medical benefits, which varies by employee bargaining group and coverage level as governed by PEHMCA. Benefits continue for surviving spouses in amounts as required by PEHMCA. Should an eligible retiree opt out of the CalPERS medical plan, they will receive $120 to $125 per month in lieu of contributions to the CalPERS plan.
As of the June 30, 2020 measurement date, approximately 491 retirees were eligible and were receiving retiree health care benefits from the City and approximately 100 inactive employees entitled to but not yet receiving benefit payments. There were approximately 415 active full time employees that should they meet requirements will be eligible to receive health care benefits upon retirement.
For the year ended June 30, 2021, the City contributed $5,482,594 to the Plan, which was comprised of benefit premiums of $2,616,594, prefunding contributions of $2,000,000 and im plied subsidy
benefit payments of $866,000.
A. FUNDING POLICY AND ACTUARIAL ASSUMPTIONS
The total OPEB liability was determined as part of a June 30, 2019 actuarial valuation using the entry age normal actuarial cost method. This is a projected benefit cost method, which takes into account those benefits that are expected to be earned in the future as well as those already accrued. The actuarial assumptions included 2.75% inflation rate, 6.25% investment rate of return, 3% projected annual salary increase, and a medical trend of 7.25% (Non-Medicare) and 6.3% (Medicare) in 2021 decreasing to an ultimate rate of 4.0% in 2076. The actuarial methods and assumptions used include techniques that smooth the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets.
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Actuarial calculations reflect a long-term perspective and actuarial valuations involve estimates of the value of reported amounts and assumptions about the probability of events far into the future.
Actuarially determined amounts are subject to revision at least biannually as results are compared to past expectations and new estimates are made about the future. The City’s OPEB unfunded actuarial accrued liability is being amortized as a level percentage of projected payroll using a 30 year closed amortization period for an initial June 30, 2008 Unfunded Accrued Actuarial Liability (UAAL), a 20 year closed amortization period for method assumptions and plan changes and 15 years for gains and losses, with a maximum of a 30 year combined closed period.
B.
NET OPEB LIABILITY
Actuarial Methods and Assumptions – The City’s net OPEB liability was measured as of June 30, 2020 and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation dated June 30, 2019, rolled forward to June 30, 2020 based on the actuarial methods and assumptions shown above.
The long-term expected rate of return on OPEB plan investments was determined using a building-block method in which expected future re al rates of return (expected return s, net of OPEB plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:
Long-Term
Target Ex pected Real
Asset Class Allocation Rate of Return
Global Equity 40% 4.82%
Fixed Income 43% 1.47%
TIPS 5% 1.29%
Commodities 4% 0.84%
REITs 8% 3.76%
Assum ed Long-Term Rate of Inflation 2.75%
Ex pected Long-Term Net Rate of Return 6.25%
Discount Rate – The discount rate used to measure the total OPEB liability was 6.25%. The projection of cash flows used to determine the discount rate as sumed that City contributions will be made at rates equal to the actuarially determined contribution rates. Based on those assumptions, the OPEB plan’s fiduciary net position was projected to be available to make all projected OPEB payments for current active and inactive employees and beneficiaries. Therefore, the long-term expected rate of return on OPEB plan investments was applied to all periods of projected benefit payments to determine the total OPEB liability.
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C. CHANGES IN NET OPEB LIABILITY
The changes in the net OPEB liability follows:
Total OPEB Plan Fiduciar y Net OPEB
Liability Net Position Liabilit y/(Asset)
(a) (b) (a) - (b)
Balance at June 30, 2020 $56,278,776 $12,167,150 $44,111,626 Changes Recognized for the Measurement Period:
Service Cost 1,455,663 - 1,455,663
Interest on the total OPEB liability 3,500,744 - 3,500,744 Changes in benefit terms - - -
Differences between expected and actual experience - - - Changes of assumptions (865,013) - (865,013)
Contributions from the employer - 5,445,074 (5,445,074) Net investment income - 653,960 (653,960)
Administrative expenses - (6,040) 6,040
Benefit payments (3,445,074) (3,445,074) -
Net changes 646,320 2,647,920 (2,001,600)
Balance at June 30, 2021 (June 30, 2020 Measurement Date) $56,925,096 $14,815,070 $42,110,026 Increase (Decrease)
Detailed information about the OPEB plan’s fiduciary net position is available in the separately issued Plan financial report that may be obtained from the CERBT. The benefit payments above include implie
d subsidy benefit payments in the amount of $831,000.
D. SENSITIVITY OF THE NET OPEB LIABILITY TO CHANGES IN THE DISCOUNT RATE
AND HEALTHCARE COST TREND RATES
The following presents the net OPEB liability of the City, as well as what the City's net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower or 1-percentage- point higher than the current discount rate:
Net OPEB Liability/(Asset)
Discount Rate -1%
Current
Discount Rate Discount Rate +1%
(5.25%) (6.25%) (7.25%)
$48,871,858 $42,110,026 $36,471,252
The following presents the net OPEB liability of the City, as well as what the City's net OPEB liability would be if it were calculated usin g healthcare cost trend rates that are 1-percentage-point lower or 1- percentage-point higher than the current healthcare cost trend rates:
Net OPEB Liability/(Asset)
Current
Healthcare Cost
1% Decrease Trend Rates 1% Increase
$35,554,890 $42,110,026 $50,096,380
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E. OPEB EXPENSE AND DEFERRED OUTFLOWS/INFLOWS OF RESOURCES RELATED
TO OPEB
For the year ended June 30, 2021, the City recognized OPEB expense of $3,129,109. At June 30, 2021, the City reported deferred outflows and inflows of resources related to OPEB from the following sources:
Deferred Outflows Deferred Inflows
of Resources of Resources
$5,482,594 -
Difference between expected and actual experience - ($2,888,912) Changes in assumptions - (882,110)
Net differences between projected and actual earnings on plan investments 20,656 -
Total $5,503,250 ($3,771,022)
Employer contributions made subsequent to the measurement date $5,482,594 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the OPEB liability in the year ended June 30, 2022. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized as part of OPEB expense as follows:
Year Annual
Ended June 30 Amortization
2022 ($1,071,828)
2023 (1,056,864)
2024 (1,058,193)
2025 (499,408)
2026 (64,073)
NOTE 9.
DEFERRED COMPENSATION PLAN
City employees may defer a portion of their compensation under a City sponsored deferred compensation plan created in accordance with Internal Revenue Code Section 457. Under this plan, participants are not taxed on the deferred portion of their compensation until distributed to them; distributions may be made only at termination, retirement, death or in an emergency as defined by the Internal Revenue Service.
The laws governing deferred compensation plan assets require plan assets to be held by a trust for the exclusive benefit of plan participants and their beneficiaries. Since the assets held under these plans are not the City’s property and are not subject to City control, they have been excluded from these financial statements.
69
NOTE 10.
SELF-INSURANCE
The Self-Insurance Internal Service Fund was established in 1979 to provide for payment of costs associated with the City’s risk management program s. Fund revenues consist of interest earnings, reimbursements of claims paid by the Fund and charges to other funds. The latter is intended to match the charges for insurance premiums for coverage in ex cess of self-insured amounts, estimated payments resulting from self-insurance programs, operating expenses and the provision of reserves for pending and possible future claims.
The City has a self-insured retention for the first $150,000 of general and automobile liability claims and maintains a $25,000 deductible for property losses. Losses in excess of the retention up to $25,000,000 on general and automobile liability are covered by purchased excess insurance. The City purchases combined property, boiler and machinery and automobile comprehensive insurance covering all but the deductible on the full value of City property. Settlements have never exceeded insurance coverage. The City expenses the incurred liabilities for claims in cases where such amounts are reasonably determinable and where the likelihood of liability exists. Included are estimates for incurred but not reported claims, which are calculated based on claims experience.
The City is a member of Public Risk Innovation, Solutions, and Management (PRISM), a joint powers authority (JPA) which provides excess workers’ compensation liability claims coverage above the City’s self-insured retention of $350,000 per occurrence. Losses above the self-insured retention are pooled with excess reinsurance purchased to provide coverage to statutory limits. During the fiscal year ended June 30, 2021, the City contributed $550,154 to PRISM fo r current year coverage. Audited financial statements for PRISM are available from PRISM at 75 Iron Point Circle, Suite 200, Folsom, CA 95630.
The City’s present value liability for uninsured claims including a provision for claims incurred but not reported using a discount rate of 2% was computed as follows based on claims experience for the years ended June 30, 2021 and 2020:
2021 2020
Beginning balance of claims payable $9,194,000 $9,355,000 Increase in estimated claims liability 3,415,361 1,893,560 Claims paid (2,459,361) (2,054,560)
Ending balance of claims payable $10,150,000 $9,194,000 Current Portion $2,452,655 $2,222,765
The undiscounted claims totaled $11,210,898 at June 30, 2021. 70
NOTE 11.
NET POSITION AND FUND BALANCE
A. NET POSITION
Net Position is the excess of all the City’s assets and deferred outflows over all its liabilities and deferred inflows, regardless of fund. Net Position is divided into three captions. These captions apply only to Net Position and are described below:
Net Investment in Capital Assets, describes the portion of Net Pos ition which is represented by the current net book value of the City’s capital assets, less the outstanding balance of any debt issued to finance these assets.
Restricted describes the portion of Net Position which is restricted as to use by the terms and conditions of agreements with outside parties, governmental regulations, laws, or other restrictions which the City cannot unilaterally alter. These principally include developer fees received for use on capital projects, debt service requirements and amounts required to be set aside for low and moderate income housing.
Unrestricted describes the portion of Net Position which is not restricted as to use.
B. GOVERNMENTAL FUND BALANCES
The City’s fund balances are classified in accorda nce with generally accepted accounting principles, Fund Balance Reporting and Governmental Fund Type Definitions, which requires the City to classify its fund balances based on spending constraints imposed on the use of resources.
For programs with multiple funding sources, the City prioritizes and expends funds in the following order: Restricted, Committed, Assigned, and Unassigned. Each category in the following hierarchy is ranked according to the degree of spending constraint.
Nonspendables represents balances set aside to indicate items do not represent available, spendable resources even though they are a component of assets. Fund balances required to be maintained intact, such as Permanent Funds, and assets not expected to be converted to cash, such as prepaids, notes receivable, and land held for redevelopment are included. However, if proceeds realized from the sale or collection of nonspendable assets are restricted, committed or assigned, then Nonspendable amounts are required to be presented as a component of the applicable category.
Restricted fund balances have external restrictions imposed by creditors, grantors, contributors, laws, regulations, or enabling legislation which requires the resources to be used only for a specific purpose.
Encumbrances and nonspendable amounts subject to restrictions are included along with spendable resources.
Committed fund balances have constraints imposed by formal action of the City Council by resolution which may be altered only by formal action in the same manner. Encumbrances and nonspendable amounts subject to council commitments are included along with spendable resources.
71
Assigned fund balances are amounts constrained by the City’s intent to be used for a specific purpose, but are neither restricted nor committed. Intent is expressed by the City Council by resolution or its designee (City Manager) and may be changed at the discretion of the City Council by resolution. This category includes encumbrances; Nonspendables, when
it is the City’s intent to use proceeds or
collections for a specific purpose, and residual fund balances, if any, of Special Revenue, Capital Projects and Debt Service Funds which have not been restricted or committed.
Unassigned fund balance represents residual amounts that have not been restricted, committed, or assigned. This includes the residual general fund balance and residual fund deficits, if any, of other governmental funds.
Detailed classifications of the City’s Fund Balances, as of June 30, 2021, are below:
Other
General G
as Capital Governmental
Fund Balance Classifications Fund Tax Grants Projects Funds Total Nonspendables:
Items not in spendable form:
Inventories $18,640 $25,184 $43,824
Petty cash 7,590 7,590
Prepaids 518,707 518,707
Loan Receivable from
Successor Agency 13,330,550 13,330,550
Total Nonspendable 13,875,487 25,184 13,900,671
Restricted for:
Pension benefits 3,746,447 3,746,447
Gas Tax Projects 12,463,196 12,463,196
Capital Projects $11,936,252 11,936,252
Low and Moderate Income
Housing Assets $8,968,790 8,968,790
545,715 545,715
Traffic Safety 78,816 78,816
Grants $696,529 696,529
Total Restricted 3,746,447 12,463,196 696,529 11 ,936,252 9,593,321 38,435,745 Assigned to:
Capital Projects 16,491,889 16,491,889
Other Contracts 375,051 375,051
Total Assigned 375,051 16,491,889 16,866,940
Unassigned:
Contingency Fund 1,000,000 1,000,000
Operating Reserve 18,000,000 18,000,000
Unassigned 25,913,148 (114) 25,913,034
Total Unassigned 44,913,148 (114) 44,913,034
Total Fund Balances $62,910,133 $12,488,380 $696,529 $28,428,141 $9,593,207 $114,116,390 Linda Vista Benefit Assessment
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C. MINIMUM FUND BALANCE POLICY
The City Council adopted a General Fund Reserve Po licy in July 2020 to establish target reserve levels and the methodology for calculating reserve leve ls. The Policy also establishes criteria for the use of reserves and a process to replenish reserves.
The Policy requires the City to strive to maintain the following fund balances:
1) Contingency Fund
The City shall maintain a minimum Contingency Fund reserve equal to $1,000,000 within its General Fund to provide a financial cushion to cover revenue shortfalls resulting from unexpected economic changes or recessionary periods or to provide funds in the event of major unplanned expenditures the City could face as a result of natural or man-made disasters such as earthquakes, windstorms, landslides, floods, wildfires, natural gas leaks, or terrorist attacks.
The balance of the Contingency Fund Reserve was $1,000,000 at June 30, 2021 and is reported as a component of General Fund unassigned fund balance.
2) General Fund Operating Reserve
The City shall maintain a minimum General Fund operating reserve equal to two months (17%), and a targeted reserve equal to three months (25%), of General Fund annual operating expenditures plus recurring (i.e., not one-time) transfers to other funds for that fiscal year.
These reserves will be used to provide adequate cash flow and budget contingencies.
The balance of the Operating Reserve was $1 8 million at June 30, 2021 and is reported as a component of General Fund unassigned fund balance.
If reserves are projected to fall below, or unexpectedly fall below, the minimum levels as set by this policy, the City shall include within its annual budget a plan to restore reserves to the minimum levels within two years based on its long-range financial forecast. Such a plan may include, but not be limited to, revenue enhancements, service delivery changes, expenditure controls/cost shifts, and/or service level reductions. At no time shall reserves be planned to fall below zero for any operating or capital fund.
D. RESTATEMENT OF NET POSITION
The City implemented the provisions of Governmental Accounting Standards Board Statement No. 84 – Fiduciary Activities during the year ended June 30, 2021. As a result, the City determined that the activities of the San Mateo Pre-Hospital Emergency Services Group (SMPHESG) previously reported in an Agency Fund would instead be reported in an External Investment Pool Custodial Fund and therefore beginning net position of the fund was restated in the amount of $1,116,458. In addition, the Billing Services Fund and Supporters of Senior Center Fund previously reported as Agency Funds are now reported as Custodial Funds and beginning net position of the Supporters of Senior Center Fund was restated in the amount of $368,450.
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NOTE 12.
LOANS AND NOTES RECEIVABLE
The City administers a housing rehabilitation program using Housing and Community Development Block Grant (CDBG) and Cal Home funds that is accounted for in the Community Block Grant Special Revenue Fund and Grants Special Revenue Fund. Under this program, individuals with incomes below a certain level are eligible to receive low interest loans, secured by deeds of trust or mobile home liens, for construction work on their homes. Although these loans and notes are expected to be repaid, their balance has been offset by unavaila ble revenue as they are not expect ed to be repaid during the next fiscal year.
During fiscal year 2021, the City made loans to 3 participants under this program and the CDBG and Ca l
HOME loan program activity is as follows:
Beginning Balance $1,527,359
New loans 114,125
Loan repayments (207,314)
Loans forgiven (15,764)
Ending Balance $1,418,406
NOTE 13.
FUND DEFICITS
The Community Block Grant Special Revenue Fund and the PERS Contributions Internal Service Fund had deficits amounting to $114 and $2,654,183, resp ectively, at June 30, 2021. The deficits will be eliminated with future revenues and available funding or other resources.
NOTE 14.
ACTIVITIES OF THE SUCCESSOR AGENCY TO THE FORMER REDEVELOPMENT AGENCY The activities of the Successor Agency are report ed in the Successor Agency to the Redevelopment Agency Private-Purpose Trust Fund as the activities are under the control of the Oversight Board. The City provides administrative services to the Successo r Agency to wind down the affairs of the former Redevelopment Agency.
Information presented in the following footnotes re presents assets and liabilities of the Successor Agency.
A. CASH
Cash and investments of the Successor Agency as of June 30, 2021 are discussed in Note 1H above.
Information presented in the following footnotes represents other assets and liabilities of the Successor Agency as of June 30, 2021.
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B. LONG RANGE PROPERTY MANAGEMENT PLAN APPROVAL
On December 14, 2015 the Successor Agency received confirmation from the DOF that the DOF had reviewed and approved the Successor Agency’s Long Range Property Management Plan (LRPMP).
C. LOANS BETWEEN THE CITY AND THE SUCCESSOR AGENCY
Due to the dissolution of the Redevelopment Agency, loans payable, totaling $23,842,357, from the Redevelopment Agency to the General Fund were written off as of June 30, 2012. In May 2016 the State Department of Finance (DOF) confirmed and approved repayment of the loan payment from the former Redevelopment Agency to the City General Fund totaling $13,775,503, payable at the statutory interest rate of 3% of the outstanding amount. In October 2016, the City received confirmation and approval of an additional repayment of the loan from the former Redevelopment Agency to the City General Fund totaling $4,579,613. These loans are recorded as a loan receivable in the City’s General Fund and is classified as nonspendable fund bala
nce as it cannot be appropriated against until funds
are received from the State. The balance of the loans as of June 30, 2021 is $13,330,550. 75
REQUIRED SUPPLEMENTARY INFORMATION
AGENT MULTIPLE-EMPLOYER DEFINED BENEFIT PENSION PLANS AND OPEB PLANS:
SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS This schedule reports the beginning and ending balances of the total pension liability, the plan assets available for pension benefits (called plan net position), and the net pension liability, as well as the change in those amounts during the year presented by cause (similar to the note disclosure). It also reports the total pension liability, plan net positi on, net pension liability, a ratio of plan net position divided by the total pension liability, the payroll amount for current employees in the plan (covered payroll), and a ratio of the net pension liability divided by covered-employee payroll.
SCHEDULE OF CONTRIBUTIONS – PENSION PLANS
This schedule reports the agent multiple-employer’s contributions to the plan which are actuarially determined, the employer’s actual contributions, the difference between the actual and actuarially determined contributions, and a ratio of the actual contributions divided by covered payroll.
SCHEDULE OF CHANGES IN THE NET OPEB LIABILITY AND RELATED RATIOS This schedule reports the beginning and ending balances of the total OPEB liability, the plan assets available for OPEB benefits (called plan net position), and the net OPEB liability, as well as the change in those amounts during the year presented by cause (similar to the note disclosure). It also reports the total OPEB liability, plan net positi on, net OPEB liability, a ratio of plan net position divided by the total OPEB liability, the payroll amount for current employees in the plan (covered- employee payroll), and a ratio of the net OPEB liability divided by covered-employee payroll.
SCHEDULE OF CONTRIBUTIONS – OPEB PLAN
This schedule reports the agent multiple-employer’s contributions to the plan which are actuarially determined, the employer’s actual contributions, the difference between the actual and actuarially determined contributions (ADC) or contractually required contributions if the ADC has not been calculated, and a ratio of the actual contributions divided by covered-employee payroll. 77
MISCELLANEOUS
Measurement Period 2013-2014 2014-2015 2015 -2016 2016-2017 2017-201 8 2018-2019 2019-2020 Total Pension Liability
Service Cost $4,928,638 $4,355,451 $4,356,641 $4,961,492 $4,820,144 $4,846,377 $4,734,206 Interest 19,456,167 20,028,375 20,453,457 21,126,222 21,405,533 22,557,657 23,372,961 Differences between expected and actual experience (5,096,599) (6,329,013) (1,376,656) 1,006,212 5,081,458 432,569 Changes in assumptions (4,888,600) 17,607,198 (9,036,830) Changes in benefits
Benefit payments, including refunds of employee
contributions (11,304,889) (12,134,586) (12,862,999) (13,610,749) (14,549,197) (15,864,061) (16,891,285) Net change in total pension liability 13,079,916 2,264,04 1 5,618,086 28,707,507 3,645,862 16,621,431 11,648,451 Total pension liability - beginning 262,603,681 275,683,5 97 277,947,638 283,565 ,724 312,273,231 315,919,093 332,540,524 Total pension liability - ending (a) $275,683,597 $27 7,947,638 $283,565,724 $312,273,231 $ 315,919,093 $332,540,524 $344,188,975 Plan fiduciary net position
Contributions - employer $3,860,928 $3,732,343 $4,446,777 $5,539,675 $6,152,860 $7,068,468 $8,214,918 Contributions - employee 2,090,754 1,959,273 2,0 19,542 2,110,207 2,068, 466 2,144,408 2,252,506 Net investment income 34,374, 839 5,074,277 1,142,662 24,378,978 19,945,939 16,443,055 12,936,801 Benefit payments, including refunds of employee
contributions (11,304,889) (12,134,586) (12,862,999) (13,610,749) (14,549,197) (15,864,061) (16,891,285) Other miscellaneous income (expense) (708,784) 585
Administrative Expense (255,289) (138,235) (326,924) (3 73,237) (179,872) (368,964) Plan to Plan Resource Movement (493) (585) 54,276
Net change in plan fiduciary net position 29,021,632 (1,624,475) (5,392,253) 18,091,187 12,535,462 9,666,859 6,143,976 Plan fiduciary net position - beginning 199,423,445 228,445,0 77 226,820,602 221,428 ,349 239,519,536 252,054,998 261,721,857 Plan fiduciary net position - ending (b) $228,445,077 $22 6,820,602 $221,428,349 $239,519,536 $ 252,054,998 $261,721,857 $267,865,833 Net pension liability - ending (a)-(b) $47,238,520 $51,12 7,036 $62,137,375 $72,753,695 $63,864,095 $70,818,667 $76,323,142 Plan fiduciary net position as a percentage of the total pension liability 82.86% 81.61% 78.09% 76.70% 79.78% 78.70% 77.83% Covered payroll $24,443,972 $22,658,6 81 $22,823,982 $23,568 ,915 $22,688,822 $24,144,928 $24,817,517 Net pension liability as percentage of covered payroll 193.25% 225.64% 272. 25% 308.68% 281.48 % 293.31% 307.54% Notes to Schedule:
* Fiscal year 2015 was the 1st year of implementation.
Changes in assumptions.
In 2016, 2018, 2019, and 2020, there were no changes. In 2017, the accounting discount rate reduced from 7.65 percent to 7.15 percent. In 2015, amounts reported reflect an adjustment of the discount rate from 7.5 percent (net of administrative expense) to 7.65 (without a reduction for pension plan administrative expense). In 2014, amounts reported were based on the 7.5 percent discount rate. All other assumptions for the June 30, 2014 measurement date were the same as those used for the June 30, 2015 and 2016 measurement dates.
Benefit changes. The figures above do not include any liability impact that may have resulted from plan changes which occurred after June 30. This applies for voluntary benefit changes as well as any offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes).
SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS As of fiscal year ending June 30, 2021
Last 10 Years*
SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS 78
SAFETY
Measurement Period 2013-2014 2014-2015 2015-2016 2016-2017 2017-2018 2018-2019 2019-2020 Total Pension Liability
Service Cost $5,018,136 $4,776,984 $4,859,775 $5,566, 167 $5,314,299 $5,562,199 $5,837,397 Interest 19,532,405 20,368,130 21,118,384 21,794, 377 22,455,535 23,732,977 24,739,728 Differences between expected and actual experience (455,068) (1,021,524) 293,934 (978,042) 7,441,738 3,245,246 Changes in assumptions (4,770,631) 17,425,044 (632,875) Changes in benefits
Benefit payments, including refunds of employee
contributions (12,996,278) (13,776,270) (14,939,167) (15,643, 224) (17,110,200) (17,828,231) (19,366,927) Net change in total pension liability 11,554,263 6,143,145 10,017,468 29,436, 298 9,048,717 18,908,683 14,455,444 Total pension liability - beginning 264,421,131 275,975,394 282,118,539 292,136,007 321,572,305 330,621,022 349,529,705 Total pension liability - ending (a) $275,975,394 $282,118,539 $292,136, 007 $321,572,305 $330,621,022 $349,529,705 $363,985,149 Plan fiduciary net position
Contributions - employer $4,225,009 $4,630,110 $5,309,673 $6,087,507 $6,986,0 96 $8,259,177 $9,741,720 Contributions - employee 2,632,654 1,864,455 1,917,899 1,935,079 2,062,297 2,040,072 2,186,070 Net investment income 33,622,839 4,997,920 1,208,758 23,497,877 18,994,354 15,591,708 12,209,629 Benefit payments, including refunds of employee
contributions (12,996,278) (13,776,270) (14,939,167) (15,643,224) (17,110,200) (17,828,231) (19,366,927) Administrative Expense (249,064) (134,719) (316,566) (358,363) (171,174) (349,203) Other Miscellaneous Expense (680,537) 556
Plan to Plan Resource Management 493 341 (556) (54,276) Net change in plan fiduciary net position 27,484,224 (2,532,356) (6,637,556) 15,561,014 9,893,091 7,837,832 4,421,289 Plan fiduciary net position - beginning 196,098,570 223,582,794 221,050,438 214,412,882 229,973,896 239,866,987 247,704,819 Plan fiduciary net position - ending (b) $223,582,794 $221,050,438 $214,412,882 $2 29,973,896 $239,866,987 247,704,819 252,126,108 Net pension liability - ending (a)-(b) $52,392,600 $61,068,101 $77,723, 125 $91,598,409 $90,754,035 $101,824,886 $111,859,041 Plan fiduciary net position as a percentage of the total pension liability 81.02% 78.35% 73.39% 71.52% 72.55% 70.87% 69.27% Covered payroll $19,652,763 $19,567,377 $19, 784,134 $19,829,558 $20,477,192 $21,410,816 $22,001,988 Net pension liability as percentage of covered payroll 266.59% 312.09% 392.86% 461.93% 443.20% 475.58% 508.40% Notes to Schedule:
* Fiscal year 2015 was the 1st year of implementation.
Source: CalPERS Accounting Valuation
Changes in assumptions. In 2016, 2018, 2019 and 2020 there were no changes. In 2017, the accounting discount rate reduced from 7.65 percent to 7.15 percent. In 2015, amounts reported reflect an adjustment of the discount rate from 7.5 percent (net of administrative expense) to 7.65 (without a reduction for pension plan administrative expense). In 2014, amounts reported were based on the 7.5 percent discount rate. All other assumptions for the June 30, 2014 measurement date were the same as those used for the June 30, 2015 and 2016 measurement dates.
Benefit changes. The figures above do not include any liability impact that may have resulted from plan changes which occurred June 30. This applies for voluntary benefit changes as well as any offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes).
SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS As of fiscal year ending June 30, 2021
Last 10 Years*
SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS 79
MISCELLANEOUS
Fiscal Year Ended June 30 2015 2016 2017 2018 2019 2020 2021 Actuarially determined contribution $4,637,116 $6,771,305 $5,540,220 $6,146,305 $7,064,967 $8,236,678 $8,901,914 Contributions in relation to the actuarially
determined contributions (4,637,116) (6,771,305) (5,540,220) (6,146,305) (7,064,967) (8,236,678) (8,901,914) Contribution deficiency (excess)
Covered payroll $22,658,681 $22,823,982 $23,568,915 $22,68 8,822 $24,144,928 $24,817,517 $24,973,064 Contributions as a percentage of covered payroll 20.47% 29.67% 23.51% 27.09% 29.26% 33.19% 35.65% Notes to Schedule
Valuation date: 6/30/2012 6/30/2013 6/30/2014 6/30/2015 6/30/2016 6/30/2017 6/30/2018
SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS As of fiscal year ending June 30, 2021
Last 10 Years*
SCHEDULE OF CONTRIBUTIONS
SAFETY
Fiscal Year Ended June 30 2015 2016 2017 2018 2019 2020 2021 Actuarially determined contribution $4,225,009 $5,309,673 $6,090,350 $6,985,429 $8,263,084 $9,742,714 $10,620,215 Contributions in relation to the actuarially
determined contributions (4,225,009) (5,309,673) (6,090,350) (6,985,429) (8,263,084) (9,742,714) (10,620,215) Contribution deficiency (excess)
Covered payroll $19,567,377 $19,784,134 $19,829,558 $20,477,192 $21,410,816 $22,001,988 $23,722,063 `
Contributions as a percentage of covered payroll 21.59% 26.84% 30.71% 34.11% 38.59% 44.28% 44.77% Notes to Schedule
Valuation date: 6/30/2012 6/30/2013 6/30/2014 6/30/2015 6/30/2016 6/30/2017 6/30/2018
SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS As of fiscal year ending June 30, 2021
Last 10 Years*
SCHEDULE OF CONTRIBUTIONS
80
Measurement Date Ended June 30 2017 2018 2019 2020
Total OPEB Liability
Service Cost $1,470,697 $1,51 4,818 $1,560,263 $1,455,663 Interest 3,449,729 3,567 ,790 3,690,181 3,500,744
Changes in benefit terms - - - -
Differences between expected and actual experience - - (4,588,272) - Changes of assumptions - - (281,571) (865,013) Benefit payments (2,980,461) (3,170,6 57) (3,168,930) (3,445,074) Net change in total OPEB liability 1,939,965 1,911,951 (2,788,329) 646,320 Total OPEB liability - beginning 55,215,189 57,155,154 59,067,105 56,278,776 Total OPEB liability - ending (a) $57,155,154 $59,067,105 $56,278,776 $56,925,096 Plan fiduciary net position
Contributions - employer $5,980,461 $4,170,657 $3,168,930 $5,445,074 Contributions - employee - - - -
Net investment income 557,870 604,302 799,047 653,960
Administrative expense (4,247) (18,096) (2,447) (6,040) Benefit payments (2,980,461) (3,170,6 57) (3,168,930) (3,445,074) Net change in plan fiduciary net position 3,553,623 1,586,206 796,600 2,647,920 Plan fiduciary net position - beginning 6,230,721 9,784,344 11,370,550 12,167,150 Plan fiduciary net position - ending (b) $9,784,344 $11,370,550 $12,167,150 $14,815,070 Net OPEB liability - ending (a)-(b) $47,370,810 $47,696, 555 $44,111,626 $42,110,026 Plan fiduciary net position as a percentage of the total OPEB liability 17.12% 19.25% 21.62% 26.03% Covered-employee payroll $50,082,473 $49,471,05 4 $50,975,693 $49,471,054 Net OPEB liability as a percentage of covered-employee payroll 94.59% 96.41% 86.53% 85.12% City of Daly City, Agent Multiple-Employer Defined Benefit OPEB Plan As of fiscal year ending June 30, 2021
Last 10 Years*
SCHEDULE OF CHANGES IN THE NET OPEB LIABILITY AND RELATED RATIOS 81
Fiscal Year Ended June 30, 2021 2020 2019 2018
Actuarially determined contributions $4,873,000 $5,264,000 $5,109,000 Contractually required contributions (a) $4,185,306
Contributions in relation to the
contractually required or actuarially
determined contributions (5,482,594) (5,445,074) (3,168,930) (4,185,306) Contribution deficiency (excess) ($609,594) ($181,074) $1,940,070 $0 Covered-employee payroll $54,458,885 $51,740,099 $50,975,693 $49,471,054 Contributions as a percentage of
covered-employee payroll 10.07% 10.52% 6.22% 9.70%
* Fi
scal year 2018 was the first year of implementation.
(a) The C
ity did not obtain an actuarially determined contribution calculation in fiscal year 2018, therefore the contractually required cont
ributions were reported.
City of Daly City, Agent Multiple-Employer Defined Benefit OPEB Plan As of fiscal year ending June 30, 2021
Last 10 Years*
SCHEDULE OF CONTRIBUTIONS
82
GENERAL FUND
The General Fund is the general operating fund of the City. It is used to account for all financial resources traditionally associated with governments which are not required to be accounted for in a separate fund. It comprises of the following activities: General, Special Deposits, and Traffic Enforcement.
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CITY OF DALY CITY
GENERAL FUND
COMBINING FUND BALANCE SHEET
JUNE 30, 2021
Special Traffic Total
General Deposits Enforcement General Fun d
ASSETS
Cash and investments $51,321,562 $12,132,979 $556,701 $64,011,242 Restricted cash and investments 3,746,447 3,746,447
Accounts receivable, net 9,479,901 66,367 49,892 9,596,160 Due from other funds 241,028 241,028
Prepaids 518,707 518,707
Inventories 18,640 18,640
Loan receivable from Successor Agency 13,330,550 13,330,550 Total Assets $78,656,835 $12,199,346 $606,593 $91,462,774
LIABILITIES
Accounts payable $2,982,735 $3,987,679 $6,970,414
Accrued payroll 1,166,165 1,166,165
Deposits payable 7,788,390 7,788,390
Unearned revenue 12,627,672 12,627,672
Total Liabilities 16,776,572 11,776,069 28,552,641
FUND BALANCES
Fund Balance
Nonspendable 13,875,487 13,875,487
Restricte
d 3,746,447 3,746,447
Assigned 375,051 375,051
Unassigned 43,883,278 423,277 606,593 44,913,148
Total Fund Balances 61,880,263 423,277 606,593 62,910,133 Total Liabilities, and Fund Balances $78,656,835 $12,199,346 $606,593 $91,462,774 84
CITY OF DALY CITY
GENERAL FUND
COMBINING FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE FOR THE YEAR ENDED JUNE 30, 2021
Total
Special Traffic General
General Deposits Enforcements Funds
REVENUES
Property tax $33,949,879 $33,949,879
Sales tax 15,570,850 15,570,850
Utility users tax 5,912,945 5,912,945
Franchise fees 4,255,982 4,255,982
Other taxes 7,300,774 7,300,774
Licenses and permits 2,981,237 2,981,237
Fines and forfeitures 2,637,093 $403,433 3,040,526
Rents and interest 562,070 562,070
Receipts from other agencies 8,388,845 8,388,845
Charges and fees 5,636,364 5,636,364
Miscellaneous 2,217,940 75 2,218,015
Total Revenues 89,413,979 75 403,433 89,817,487
EXPENDITURES
Current:
General government 12,816,188 2,206 12,818,394
Public safety 62,956,867 278,522 63,235,389
Public works 5,644,073 5,644,073
Culture and recreation 10,125,396 10,125,396
Economic and community development 3,971,153 3,971,153
Total Expenditures 95,513,677 2,206 278,522 95,794,405
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (6,099,698) (2,131) 124,911 (5,976,918)
OTHER FINANCING SOURCES (USES)
Proceeds from sale of property 379,095 379,095
Transfers in 3,330,227 3,330,227
Transfers (out) (8,490,365) (8,490,365)
Total Other Financing Sources (Uses) (4,781,043) (4,781,043) NET CHANGES IN FUND BALANCES (10,880,741) (2,131) 124,911 (10,757,961) BEGINNING FUND BALANCES 72,761,004 425,408 481,682 73,668,094 ENDING FUND BALANCES $61,880,263 $423,277 $606,593 $62,910,133 85
MAJOR GOVERNMENTAL FUNDS, OTHER THAN
GENERAL FUND AND SPECIAL REVENUE FUNDS
The Capital Projects Fund is used to account for financial resources to be used for the acquisition, construction or rehabilitation of major capital assets other than those financed by Proprietary Funds.
87
CITY OF DALY CITY
CAPITAL PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2021
Variance
Positive
Budget Actual (Negative)
REVENUES
Rents and interest ($56,565) ($56,565)
Federal programs and grants $191,950 215,118 23,168
Receipts from other agencies 112,614 254,055 141,441
Charges and fees 2,562,983 2,201,354 (361,629)
Miscellaneous 189,998 189,998
Total Revenues 2,867,547 2,803,960 (63,587)
EXPENDITURES
Capital projects 11,100,278 3,070,593 8,029,685
Total Expenditures 11,100,278 3,070,593 8,029,685
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (8,232,731) (266,633) 7,966,098
OTHER FINANCING SOURCES (USES)
Transfers in 5,709,781 4,833,167 (876,614)
Transfers (out) (3,835,420) (1,661,410) 2,174,010
Total Other Financing Sources (Uses) 1,874,361 3,171,757 1,297,396 NET CHANGE IN FUND BALANCES ($6,358,370) 2,905,124 $9,263,494 BEGINNING FUND BALANCE 25,523,017
ENDING FUND BALANCE $28,428,141
88
NONMAJOR GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS
Special Revenue Funds are used to account for th e proceeds of specific revenue sources (other than special assessments, expendable trusts, or major capital projects) that are legally restricted to expenditures for specified purposes or for which separate accounting is required by administrative action.
The City's Special Revenue Funds are as follows:
Low and Moderate Income Housing Assets – to account for the activities of the Housing Successor Agency to the Daly City Redevelopment Agency. Community Block Grant - to account for monies received by the City as a participant in the federal Community Development Block Grant (CDBG) program. Linda Vista Benefit Assessment - to account for the charges and for the costs of maintenance of storm drains in the Linda Vista Subdivision.
Traffic Safety – to account for grant funds and vehicle impound fees authorized by State law specifically to provide traffic safety programs.
89
CITY OF DALY CITY
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
JUNE 30, 2021
SPECIAL REVENUE FUNDS
Total
Low and Moderate Community Linda Vista Nonmajo r
Income Housing Block Benefit Traffic Governmental
Assets Grant Assessment Safety Funds
ASSETS
Cash and investments $5,610,719 $547,370 $78,696 $6,236,785 Accounts receivable, net $285,684 505 120 286,309
Notes receivable 1,021,468 1,021,468
Property held for development 3,366,888 3,366,888
Total Assets $8,977,607 $1,307,152 $547,875 $78,816 $10,911,450
LIABILITIES
Accounts payable $4,013 $39,984 $2,160 $46,157
Accrued payroll 803 3,147 3,950
Due to other funds 241,028 241,028
Deposits payable 4,001 1,639 5,640
Total Liabilities 8,817 285,798 2,160 296,775
DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - loans 1,021,468 1,021,468
FUND BALANCES
Restricte
d 8,968,790 545,715 78,816 9,593,321
Unassigned (114) (114)
Total Fund Balances 8,968,790 (114) 545,715 78,816 9,593,207 Total Liabilities, Deferred Inflows of
Resources and Fund Balances $8,977,607 $1,307,152 $547,875 $78,816 $10,911,450 90
CITY OF DALY CITY
NONMAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED JUNE 30, 2021
SPECIAL REVENUE FUNDS
Total
Low and Moderate Community Linda Vista Nonmajo r
Income Housing Block Benefit Traffic Governmental
Assets Grant Assessment Safety Funds
REVENUES
Rents and interest $52,862 ($1,677) $51,185
Federal programs and grants $994,785 994,785
Charges and fees 20,064 44,380 $7,640 72,084
Miscellaneous 4,100 258,423 261 262,784
Total Revenues 77,026 1,253,208 42,703 7,901 1,380,838
EXPENDITURES
Public safety 29,063 29,063
Public works 26,353 26,353
Culture and recreation
Economic and community development 258,627 865,302 1,123,929 Debt service:
Principal 365,000 365,000
Interest 23,020 23,020
Total Expenditures 258,627 1,253,322 26,353 29,063 1,567,365
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (181,601) (114) 16,350 (21,162) (186,527)
OTHER FINANCING SOURCES (USES)
Transfers in 228,500 228,500
Total Other Financing Sources (Uses) 228,500 228,500
NET CHANGE IN FUND BALANCES 46,899 (114) 16,350 (21,162) 41,973 BEGINNING FUND BALANCES 8,921,891 529,365 99,978 9,551,234 ENDING FUND BALANCES $8,968,790 ($114) $545,715 $78,816 $9,593,207 91
CITY OF DALY CITY
BUDGETED NONMAJOR GOVERNMENTAL FUNDS
COMBINING SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2021
COMMUNITY BLOCK GRANT
Variance Variance
Positive Positive
Budget Actual (Negative) Budge t Actual (Negative)
REVENUES
Rents and interest $75,000 $52,862 ($22,138)
Federal programs and grants $2,439,357 $994,785 ($1,444,572) Charges and fees 492,296 20,064 (472,232)
Miscellaneous 19,500 4,100 (15,400) 253,987 258,423 4,436 Total Revenues 586,796 77,026 (509,770) 2,693,344 1,253,208 (1,440,136)
EXPENDITURES
Public Safety
Services and supplies
Capital outlay
Other charges
Total Public Safety
Public Works
Services and supplies
Capital outlay
Other charges
Total Public Works
Culture and Recreation
Salaries and benefits
Services and supplies
Other charges
Total Culture and Recreation
Economic and Community Development
Salaries and benefits 111,484 113,519 (2,035) 439,663 426,508 13,155 Services and supplies 206,603 145,108 61,495 992,272 315,377 676,895 Other charges 4,200,000 4,200,000 797,710 123,417 674,293 Debt Service:
Principal 365,000 365,000
Interest 23,020 23,020
Total Economic and Community Development 4,518,087 258,627 4,259,460 2,617,665 1,253,322 1,364,343 Total Expenditures 4,518,087 258,627 4,259,460 2,617,665 1,253,322 1,364,343
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (3,931,291) (181,601) 3,749,690 75,679 (114) (75,793)
OTHER FINANCING SOURCES (USES)
Transfers in 228,500 228,500
Transfers out
Total Other Financing Sources (Uses) 228,500 228,500
NET CHANGE IN FUND BALANCES ($3,702,791) 46,899 $3,749,690 $75,679 (114) ($75,793) BEGINNING FUND BALANCES 8,921,891
ENDING FUND BALANCES $8,968,790 ($114)
INCOME HOUSING ASSETS
LOW AND MODERATE
92
LINDA VISTA
BENEFIT ASSESSMENT TRAFFIC SAFETY
Variance Variance
Positive Positive
Budget Actual (Negative) Budge t Actual (Negative)
$5,264 ($1,677) ($6,941)
44,381 44,380 (1) $12,120 $7,640 ($4,480)
261 261
49,645 42,703 (6,942) 12,120 7,901 (4,219)
34,587 22,867 11,720
1,256 1,146 110
6,321 5,050 1,271
42,164 29,063 13,101
16,942 17,782 (840)
4,000 8,070 (4,070)
500 501 (1)
21,442 26,353 (4,911)
21,442 26,353 (4,911) 42,164 29,063 13,101
28,203 16,350 (11,853) (30,044) (21,162) 8,882
$28,203 16,350 ($11,853) ($30,044) (21,162) $8,882
529,365 99,978
$545,715 $78,816
93
NONMAJOR ENTERPRISE FUNDS
The City maintains the following nonmajor enterprise funds:
Civic Center - to account for rental activity of real property owned by the City in the Civic Center area.
Transfer Station - to account for the activity of the Mussel Rock garbage transfer station. 95
Civic Center Transfer Station Total
ASSETS
Current Assets:
Cash and investments $1,504,475 $1,545,317 $3,049,792
Accounts receivable, net 14,523 14,523
Total Current Assets 1,518,998 1,545,317 3,064,315
Capital Assets:
Land 1,695,762
93,384 1,789,146
Buildings 5,568,728 1,184,278 6,753,006
Equipment 936,705 20,912 957,617
Total Capital Assets 8,201,195 1,298,574 9,499,769
Less accumulated depreciation (5,098,912) (1,205,190) (6,304,102) Net Capital Assets 3,102,283 93,384 3,195,667
Total Assets 4,621,281 1,638,701 6,259,982
LIABILITIES
Current Liabilities:
Accounts payable 16,316 16,316
Total Liabilities 16,316 16,316
NET POSITION
Net investment in capital assets 3,102,283 93,384 3,195,667 Unrestricte
d 1,502,682 1,545,317 3,047,999
Total Net Position $4,604,965 $1,638,701 $6,243,666
JUNE 30, 2021
COMBINING STATEMENT OF FUND NET POSITION
NONMAJOR ENTERPRISE FUNDS
CITY OF DALY CITY
96
CITY OF DALY CITY
NONMAJOR ENTERPRISE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN FUND NET POSITION
FOR THE YEAR ENDED JUNE 30, 2021
Civic Center Transfer Station Total
OPERATING REVENUES
Rental income $881,616 $881,616
Other revenues 45,171 $108,390 153,561
Total Operating Revenues 926,787 108,390 1,035,177
OPERATING EXPENSES
Salaries and benefits
Services and supplies 488,425 488,425
Utilities 159,625 159,625
Insurance 19,346 19,346
Depreciation 190,693 190,693
Total Operating Expenses 858,089 858,089
Operating Income 68,698 108,390 177,088
NONOPERATING REVENUES (EXPENSES)
Interest income (5,419) (5,419)
Income (Loss) Before Transfers 63,279 108,390 171,669
Transfers out (62,250) (110,194) (172,444)
Change in Net Position 1,029 (1,804) (775)
BEGINNING NET POSITION 4,603,936 1,640,505 6,244,441
ENDING NET POSITION $4,604,965 $1,638,701 $6,243,666
97
CITY OF DALY CITY
NONMAJOR ENTERPRISE FUNDS
COMBINING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2021
Transfer
Civic Center Station Total
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers $942,036 $307,825 $1,249,861
Payments to suppliers (668,720) (65) (668,785)
Payments to employees
Cash Flows from Operating Activities 273,316 307,760 581,076
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
Transfers out (62,250) (110,194) (172,444)
Cash Flows from Noncapital financing activities (62,250) (110,194) (172,444)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest income (5,419) (5,419)
Net Cash Flows 205,647 197,566 403,213
Cash and investments at beginning of year 1,298,828 1,347,751 2,646,579 Cash and investments at end of year $1,504,475 $1,545,317 $3,049,792 Reconciliation of operating income (loss) to net cash flows from operating activities:
Operating income (loss) $68,698 $108,390 $177,088
Adjustments to reconcile operating income to net cash
flows from operating activities:
Depreciation 190,693 190,693
Change in assets and liabilities:
Accounts receivable 15,249 199,435 214,684
Accounts payable (1,324) (65) (1,389)
Compensated absences
OPEB related items
Cash Flows from Operating Activities $273,316 $307,760 $581,076 98
INTERNAL SERVICE FUNDS
Internal Service Funds are used to finance and account for special activities and services performed by a designated department for other departments in the City on a cost reimbursement basis.
The concept of major funds does not extend to internal service funds because they do not do business with outside parties. For the Statement of Activities, the net revenues or expenses of each internal service fund are eliminated by netting them against the operations of the other City departments which generated them. The remaining balance sheet items are consolidated with these same funds in the Statement of Net Position. However, internal service funds are still presented separately in the Fund financial statements.
The City's Internal Service Funds are:
Motor Vehicles - to account for the purchase and maintenance of all motor vehicles provided as a service to City departments.
Central Services - to account for and allocate costs related to providing mail messenger services for City departments.
PBX - to account for services provided for the operation and maintenance of the City's telephone system.
Building Maintenance - to account for services provided for the maintenance of City facilities. Information Services - to account for the distribution of computer hardware, software and operating costs to various City departments.
Self-Insurance - to account for the costs of workers compensation, automotive, and general liability claims against the City.
PERS Contributions - to account for the long-term debt, prepaid PERS contributions and repayments from benefiting City funds and departments resulting from the City’s PERS Obligation Bond issue.
99
CITY OF DALY CITY
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF NET POSITION
JUNE 30, 2021
Motor Central Building
Vehicles
Services PBX Maintenance
ASSETS
Current Assets:
Cash and investments $6,902,399 $270,824 $399,136 $2,708,222 Cash with fiscal agent
Accounts receivable, net 29,939
Inventories 102,527 58,509
Prepaids 1,483,056
Total Current Assets 8,517,921 270,824 399,136 2,766,731 Capital Assets:
Land
Buildings 35,817
Equipment 17,710,926 9,370 932,404 132,467
Furniture and fixtures 16,490
Construction in progress
Total Capital Assets 17,746,743 9,370 932,404 148,957
Less Accumulated Depreciation (12,021,134) (9,370) (932,404) (75,791) Net Capital Assets 5,725,609 73,166
Total Assets 14,243,530 270,824 399,136 2,839,897
DEFERRED OUTFLOWS OF RESOURCES
Related to OPEB 93,177 29,118 215,471
LIABILITIES
Current Liabilities:
Accounts payable 76,508 4,296 69,930
Accrued payroll 7,073 1,199 21,100
Interest payable 21,118
Accrued claims payable
Lease payable 195,490
PERS obligation bonds
Total Current Liabilities 300,189 5,495 91,030
Long-Term Liabilities:
Compensated absences 170,315 395,471
Accrued claims payable
Net OPEB Liabilit
y 712,974 222,804 1,648,752
Lease payable 1,287,566
PERS obligation bonds
Total Long-Term Liabilities 2,170,855 222,804 2,044,223 Total Liabilities 2,471,044 228,299 2,135,253
DEFERRED INFLOWS OF RESOURCES
Related to OPEB 63,848 19,952 147,648
NET POSITION
Net investment in capital assets 4,242,553 73,166
Restricted for debt service
Unrestricte
d 7,559,262 51,691 399,136 699,301
Total Net Position (Deficit) $11,801,815 $51,691 $399,136 $772,467 100
Information Self-
PERS
Services Insurance Contributions Total
$5,233,999 $16,602,896 $9,464,361 $41,581,837
549 549
150 16,643 46,732
161,036
1,483,056
5,234,149 16,619,539 9,464,910 43,273,210
378,343 378,343
35,817
4,571,527 23,356,694
46,614 63,104
331,402 331,402
4,949,543 378,343 24,165,360
(3,734,978) (16,773,677)
1,214,565 378,343 7,391,683
6,448,714 16,997,882 9,464,910 50,664,893
58,226 395,992
30,100 34,411 251,067 466,312
10,856 2,836 43,064
58,026 79,144
2,452,655 2,452,655
195,490
3,560,000 3,560,000
40,956 2,489,902 3,869,093 6,796,665
134,631 36,656 737,073
7,697,345 7,697,345
445,609 3,030,139
1,287,566
8,250,000 8,250,000
580,240 7,734,001 8,250,000 21,002,123
621,196 10,223,903 12,119,093 27,798,788
39,905 271,353
1,214,565 378,343 5,908,627
549 549
4,631,274 6,395,636 (2,654,732) 17,081,568
$5,845,839 $6,773,979 ($2,654,183) $22,990,744
101
Motor Central Building
Vehicles Services PBX Maintenance
OPERATING REVENUES
Charges to City departments $4,449,861 $247,325 $279,942 $5,127,838 Other revenues 238,914 2,450 216,190
Total Operating Revenues 4,688,775 247,325 282,392 5,344,028
OPERATING EXPENSES
Salaries and benefits 1,201,468 97,806 3,220,828
Services and supplies 1,413,519 104,300 56,775 1,015,785 Utilities 20,301 212 156,441 250,581
Insurance 549,230 208 6,605
Claims and settlements
Depreciation 851,097 7,073
Other charges 4,168 1,105 97,287
Total Operating Expenses 4,039,783 203,631 213,216 4,598,159 Operating Income (Loss) 648,992 43,694 69,176 745,869
NONOPERATING REVENUES (EXPENSES)
Interest income 1,778 88 (597) 502
Gain on sale of capital assets 57,540
Loss on sale of capital assets (2,766)
Interest expense (21,118)
Total Nonoperating Revenues (Expenses) 35,434 88 (597) 502 Income (Loss) Before Transfers 684,426 43,782 68,579 746,371 Transfers in 158,711 42,104
Transfers out (78,168) (11,197) (12,779) (129,605)
Net Transfers 80,543 30,907 (12,779) (129,605)
Change in Net Position 764,969 74,689 55,800 616,766
BEGINNING NET POSITION (DEFICITS) 11,036,846 (22,998) 343,336 155,701 ENDING NET POSITION (DEFICITS) $11,801,815 $51,691 $399,136 $772,467
CITY OF DALY CITY
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN FUND NET POSITION
FOR THE YEAR ENDED JUNE 30, 2021
102
Information Self- PERS
Services Insurance Contributions Total
$3,148,432 $6,934,540 $4,368,317 $24,556,255
49,734 160,284 667,572
3,198,166 7,094,824 4,368,317 25,223,827
1,408,883 352,690 6,281,675
1,282,818 1,511,076 7,442 5,391,715
45,690 777 474,002
262 1,537,896 2,094,201
2,459,361 2,459,361
42,191 900,361
153,764 2,358 258,682
2,933,608 5,864,158 7,442 17,859,997
264,558 1,230,666 4,360,875 7,363,830
(16,902) (24,055) 487 (38,699)
57,540
(425) (3,191)
(870,078) (891,196)
(17,327) (24,055) (869,591) (875,546)
247,231 1,206,611 3,491,284 6,488,284
64,581 265,396
(251,450) (221,046) (704,245)
(186,869) (221,046) (438,849)
60,362 985,565 3,491,284 6,049,435
5,785,477 5,788,414 (6,145,467) 16,941,309
$5,845,839 $6,773,979 ($2,654,183) $22,990,744
103
CITY OF DALY CITY
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2021
Motor Central Building
Vehicles
Services PBX Maintenance
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers $4,663,530 $247,325 $282,392 $5,344,373 Payments to suppliers (3,456,890) (106,239) (213,225) (1,422,534) Payments to employees (1,171,049) (99,124) (3,192,104)
Claims pai
d
Cash Flows from (used for) Operating Activities 35,591 41,962 69,167 729,735
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
Principal paid on noncapital debt
Interest paid on noncapital debt
Interfund receipts 158,711 42,104
Interfund payments (78,168) (11,197) (12,779) (129,605) Cash Flows from (used for) Noncapital
Financing Activities 80,543 30,907 (12,779) (129,605)
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Acquisition of capital assets (278,907) (1)
Proceeds from sale of capital assets 57,540
Issuance of debt 1,483,056
Principal paid on capital debt
Interest paid on capital debt
Cash Flows from (used for) Capital and Related
Financing Activities 1,261,689 (1)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest income (expense) 1,778 88 (597) 502
Net Cash Flows 1,379,601 72,957 55,791 600,631
Cash and investments at beginning of period 5,522,798 197,867 343,345 2,107,591 Cash and investments at end of period $6,902,399 $270,824 $399,136 $2,708,222 Reconciliation of operating income (loss) to net cash flows from operating activities:
Operating income (loss) $648,992 $43,694 $69,176 $745,869 Adjustments to reconcile operating income (loss) to net cash flows from operating activities:
Depreciation 851,097 7,073
Change in assets and liabilities:
Receivables, net (25,245) 345
Inventories (5,458) (18,917)
Prepaids (1,483,056)
Accounts payable 18,842 (414) (9) (33,359)
Accrued claims payable
Accrued payroll 1,988 322 8,163
Compensated absences 33,678 32,695
OPEB related items (5,247) (1,640) (12,134)
Cash Flows from (used for) Operating Activities $35,591 $41,962 $69,167 $729,735
NONCASH TRANSACTIONS
Retirement of capital assets ($2,766)
104
Information Self- PERS
Services Insurance Contributions Total
$3,198,166 $7,338,504 $4,368,317 $25,442,607
(1,491,148) (2,203,071) (7,442) (8,900,549)
(1,383,923) (397,810) (6,244,010)
(2,459,361) (2,459,361)
323,095 2,278,262 4,360,875 7,838,687
(3,215,000) (3,215,000)
(885,875) (885,875)
64,581 265,396
(251,450) (221,046) (704,245)
(186,869) (221,046) (4,100,875) (4,539,724)
(221,784) (500,692)
57,540
1,483,056
(221,784) 1,039,904
(16,902) (24,055) 487 (38,699)
(102,460) 2,033,161 260,487 4,300,168
5,336,459 14,569,735 9,204,423 37,282,218
$5,233,999 $16,602,896 $9,464,910 $41,582,386
$264,558 $1,230,666 $4,360,875 $7,363,830
42,191 900,361
243,680 218,780
(24,375)
(1,483,056)
(8,614) (106,964) (130,518)
956,000 956,000
4,341 712 15,526
23,887 (45,832) 44,428
(3,268) (22,289)
$323,095 $2,278,262 $4,360,875 $7,838,687
($425) ($3,191)
105
CUSTODIAL FUNDS
Custodial Funds account for assets held by the City as agent for individuals, governmental entities, and nonpublic organizations. Custodial funds are required to be presented separately from the Government-wide and Fund financial statements.
These funds include the following:
Billing Services – a custodial fund to account for the cash temporarily held by the City in its role as billing agent for garbage collection services provided by Republic Services Group.
Supporters of Senior Center – a custodial fund to reflect cash held by the City in its role as fiscal agent for the Supporters of Doelger Senior Center, a private nonprofit organization benefiting seniors in Daly City. The Supporters stablish how the sources can be expended and approve disbursements from the account. 107
CITY OF DALY CITY
CUSTODIAL FUNDS
COMBINING STATEMENT OF NET POSITION
FOR THE YEAR ENDED JUNE 30, 2021
Billing Supporters of
Services Senior Center Total
ASSETS
Current Assets:
Cash and investments $1,397,257 $366,571 $1,763,828
Accounts receivable, net 2,342,510 80,000 2,422,510
Total Assets 3,739,767 446,571 4,186,338
LIABILITIES
Current Liabilities:
Accounts payable 3,739,767 2,279 3,742,046
Total Liabilities 3,739,767 2,279 3,742,046
NET POSITION
Restricted for other organizations 444,292 444,292
Total Net Position (Deficit) $444,292 $444,292
108
CITY OF DALY CITY
CUSTODIAL FUNDS
COMBINING STATEMENT OF CHANGES IN NET POSITION
FOR THE YEAR ENDED JUNE 30, 2021
Billing Supporters of
Services Senior Center Total
ADDITIONS
Charges for services
Receipts from other agencies $80,100 $80,100
Interest income
Total Additions 80,100 80,100
DEDUCTIONS
Culture and recreation 4,258 4,258
Total Deductions 4,258 4,258
Change in Net Position 75,842 75,842
BEGINNING NET POSITION, AS RESTATED 368,450 368,450
ENDING NET POSITION (DEFICITS) $444,292 $444,292
109
STATISTICAL SECTION
This part of the City’s Annual Comprehensive Financial Report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, an d
required supplementary information says about the C ity’s overall financial health. In contrast to the financial section, the statistical section information is not subject to independent audit.
Financial Trends
These schedules contain trend information to help the reader understand how the City’s financial performance and well-being have changed over time:
1. Net Position by Component
2. Changes in Net Position
3. Fund Balances of Governmental Funds
4. Changes in Fund Balance of Governmental Funds
Revenue Capacity
These schedules contain information to help the re ader assess the City’s most significant local revenue source, the property tax:
1. Assessed Value of Taxable Real Property
2. Direct and Overlapping Property Tax Rates
3. Principal Property Tax Payers
4. Property Tax Levies and Collections
Debt Capacity
These schedules present information to help the reader assess the affordability of the City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future:
1. Ratio of Outstanding Debt by Type
2. Computation of Direct and Overlapping Debt
3. Computation of Legal Bonded Debt Margin
4. Water Utility District
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the environment within which the City’s financial activities take place:
1. Demographic and Economic Statistics
2. Principal Employers
111
STATISTICAL SECTION - (Continued)
Operating Information
These schedules contain service an d infrastructure data to help the reader understand how the information in the City’s financial report relates to the services the City provides and the activities it performs:
1. Full-Time City Government Employees by Function
2. Operating Indicators by Function/Program
3. Capital Asset Statistics by Function/Program
Sources
Unless otherwise noted, the information in these schedules is derived from the Annual Comprehensive Financial Reports for the relevant year.
112
CITY OF DALY CITY
Net Position by Component
Last Ten Fiscal Years
(Accrual Basis of Accounting)
2012 2013 2014 2015 2016
Governmental activities
Net investment in capital assets $87,549,833 $85,483,907 $84,272,501 $82,583,587 $94,823,140 Restricted 15,053,531 18,829,245 20,021,555 17,933,727 19,744,996 Unrestricted 23,884,922 18,898,618 22,495,121 (88,028,802) (64,966,915) Total governmental activities net position $126,488,286 $123,211,770 $126,789,177 $12,488,512 $49,601,221 Business-type activities
Net investment in capital asset $68,587,946 $67,479,305 $67,235,990 $66,278,166 $65,118,626 Restricted 11,229 11,231 11,250
Unrestricted 32,290,613 30,663,259 34,392,335 20,914,381 28,846,650 Total business-type activities net position $100,878,559 $98,142,564 $101,639,554 $87,203,778 $93,976,526 Primary government
Net investment in capital assets $156,137,779 $152,963,212 $151,508,491 $148,861,753 $159,941,766 Restricted 15,053,531 18,829,245 20,032,784 17,944,958 19,756,246 Unrestricted 56,175,535 49,561,877 56,887,456 (67,114,421) (36,120,265) Total primary government net position $227,366,845 $221,354,334 $228,428,731 $99,692,290 $143,577,747 2017 2018 2019 2020 2021
Governmental activities
Net investment in capital assets $97,821,524 $97,958,640 $97,757,236 $100,413,948 $96,788,966 Restricted 20,315,097 19,491,867 21,237,769 27,367,081 36,133,323 Unrestricted (62,902,410) (92,551,797) (76,426,827) (76,136,850) (87,745,203) Total governmental activities net position $55,234,211 $24,898,710 $42,568,178 $51,644,179 $45,177,086 Business-type activities
Net investment in capital assets $64,499,223 $65,137,866 $66,160,150 $67,108,189 $66,028,084 Restricted 11,250 11,281 11,387 11,325 11,324
Unrestricted 32,508,857 27,207,951 24,735,488 27,617,595 31,433,874 Total business-type activities net position $97,019,330 $92,357,098 $90,907,025 $94,737,109 $97,473,282 Primary government
Net investment in capital assets $162,320,747 $163,096,506 $163,917,386 $167,522,137 $162,817,050 Restricted 20,326,347 19,503,148 21,249,156 27,378,406 36,144,647 Unrestricted (30,393,553) (65,343,846) (51,691,339) (48,519,255) (56,311,329) Total primary government net position $152,253,541 $117,255,808 $133,475,203 $146,381,288 $142,650,368 ($100,000)
($50,000)
$0
$50,000
$100,000
$150,000
$200,000
$250,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Thousands
Net investment in capital assets Restricted Unrestricted 113
For the Fiscal Year Ended June 30,
2012 2013 2014 2015
Expenses
Governmental activities:
General government $10,260,757 $8,823,639 $10,889,822 $9,669,627 Public safety 45,511,296 44,910,136 42,704,694 43,774,625 Public works 5,406,051 5,064,375 5,597,137 7,579,522
Streets and infrastructure 3,395,911 4,114,332 3,318,214 3,466,347 Culture and recreation 14,415,687 13,811,273 13,350,277 11,621,738 Economic and community development 5,654,736 4,661,549 3,592,174 4,718,470 Nondepartmental
Interest on long term debt 335,549 177,561 166,114 172,642 Total governmental activities expenses 84,979,987 81,562,865 79,618,432 81,002,971 Business-type activities:
Water 13,460,939 15,266,033 13,337,352 14,451,497
Civic center 686,051 813,497 841,901 853,913
Transfer station 48,926 151,582 165,477 178,290
Sanitation district 18,587,421 16,663,492 18,262,624 18,629,686 Total business-type activities expenses 32,783,337 32,894,604 32,607,354 34,113,386 Total primar
y government expenses $117,763,324 $114,457,469 $112,225,786 $115,116,357 Program Revenues
Governmental activities:
Charges for services:
General government $764,719 $753,748 $1,034,252 $5,054,225 Public safety 4,685,400 4,415,226 4,454,105 5,403,840
Public works 1,259,803 1,313,510 1,036,109 1,528,698
Streets and infrastructure 953,473 1,009,844 1,135,335 1,283,105 Culture and recreation 2,913,641 2,723,265 2,812,145 2,989,174 Economic and community development 2,095,455 2,374,804 2,243,212 4,961,729 Nondepartmental
Operating grants and contributions 8,189,627 7,356,801 7,901,753 8,467,395 Capital grants and contributions 3,421,710 763,676 325,832 3,355,718 Total governmental activities program revenues 24,283,828 20,710,874 20,942,743 33,043,884 Business-type activities:
Charges for services:
Water 14,625,062 16,357,654 18,095,452 18,731,931
Civic center 759,286 671,556 834,950 976,374
Transfer station 375,000 375,000 375,000 375,000
Sanitation district 15,018,052 15,600,570 16,676,480 18,416,575 Total business-type activities program revenues 30,777,400 33,004,780 35,981,882 38,499,880 Total primar
y government program revenues $55,061,228 $53,715,654 $56,924,625 $71,543,764 Net (Expense)/Revenue
Governmental activities ($60,696,159) ($60,851,991) ($58,675,689) ($47,959,087) Business-type activities (2,005,937) 110,176 3,374,528 4,386,494 Total primary government net expense ($62,702,096) ($60,741,815) ($55,301,161) ($43,572,593) (a) Beginning in fiscal year 2020, Streets and Infrastructures is reported with Public Works.
CITY OF DALY CITY
Changes in Net Position
Last Ten Fiscal Years
(Accrual Basis of Accounting)
114
For the Fiscal Year Ended June 30,
2016 2017 2018 2019 2020 2021
$10,685,635 $7,972,197 $11,936,041 $12,476,872 $12,998,948 $13,339,758 45,867,228 63,616,023 55,603,978 56,118,396 65,368,018 67,486,476 8,196,165 7,573,579 10,963,753 12,218,279 14,216,669 17,734,741 4,014,914 3,335,132 2,198,287 1,955,081 (a)
12,263,494 10,221,420 12,412,166 12,446,541 12,597,628 10,761,931 4,099,948 3,083,160 5,194,603 4,107,836 4,649,920 5,193,416 40,000 1,373,040 1,230,480 1,160,227 820,486
85,167,384 95,801,511 99,681,868 100,553,485 110,991,410 115,336,808 16,082,814 14,954,595 17,406,932 15,811,469 17,107,407 16,761,016 892,003 800,786 961,868 792,490 832,870 863,506
37,579 206,918 266,241 234,590 28,709 (213)
14,325,333 16,357,133 22,460,549 23,578,769 26,304,502 28,264,570 31,337,729 32,319,432 41,095,590 40,417,318 44,273,488 45,888,879 $116,505,113 $128,120,943 $140,777,458 $140,970,803 $155,264,898 $161,225,687 $4,074,661 $3,850,838 $4,459,835 $664,292 $743,003 $422,110 6,490,600 6,833,086 7,140,073 5,780,948 6,619,952 5,371,364 2,524,779 994,308 1,304,594 1,355,782 4,062,420 4,113,341 1,528,812 1,432,015 1,705,245 1,244,532 (a)
3,162,473 2,906,739 3,115,467 2,859,075 2,105,126 502,031 6,162,433 4,645,536 4,582,767 3,900,404 4,704,318 4,054,903 6,311,937 6,293,562 6,774,088 11,518,920 17,017,844 18,280,149 2,492,055 1,824,697 1,233,529 5,520,111 4,597,424 2,472,075 32,747,750 28,780,781 30,315,598 32,844,064 39,850,087 35,215,973 16,645,244 17,186,882 18,879,659 20,671,704 23,385,773 23,672,903 695,906 676,391 589,569 801,304 844,360 881,616
281,250
19,695,887 19,284,396 21,507,323 22,712,582 22,679,620 23,364,666 37,318,287 37,147,669 40,976,551 44,185,590 46,909,753 47,919,185 $70,066,037 $65,928,450 $71,292,149 $77,029,654 $86,759,840 $83,135,158 ($52,419,634) ($67,020,730) ($69,366,270) ($67,709,421) ($71,141,323) ($80,120,835) 5,980,558 4,828,237 (119,039) 3,768,272 2,636,265 2,030,306 ($46,439,076) ($62,192,493) ($69,485,309) ($63,941,149) ($68,505,058) ($78,090,529) (Continued)
115
CITY OF DALY CITY
Changes in Net Position
(continued)
Last Ten Fiscal Years
(Accrual Basis of Accounting)
For the Fiscal Year Ended June 30,
2012 2013 2014 2015
General Revenues and Other Changes in Net Position
Governmental activities:
Taxes:
Property taxes $27,903,523 $24,682,775 $26,609,070 $29,327,703 Sales taxes 10,638,574 11,619,157 12,594,335 12,379,135 Utility users tax 6,532,361 6,528,566 6,422,821 6,399,410 Franchise fees 3,500,118 3,544,075 3,663,247 3,675,411
Other taxes 4,203,616 4,756,255 5,247,886 5,322,471
Motor vehicle in-lieu 109,179 45,981 44,416
Investment earnings 1,018,793 12,330 925,838 467,009
Other revenues 3,180,451 3,758,739 3,936,433 1,061,054
Transfers 2,800,581 3,010,709 2,853,466 2,983,597
Gain/(Loss) on sale of property (3,003,763)
Extraordinary or Special item (19,006,131) (383,112)
Total government activities 40,881,065 57,575,475 62,253,096 58,656,443 Business-type activities:
Property taxes 1,433,604 1,470,340 1,558,773 1,713,895
Investment earnings 534,239 (23,403) 493,501 265,045
Other revenues 704,506 715,729 918,589 2,350,952
Gain/(Loss) on sale of property 14,001 1,872 5,065
Transfers (2,800,581) (3,010,709) (2,853,466) (2,983,597) Extraordinary item or special item (2,000,000)
Total business-type activities (114,231) (2,846,171) 122,462 1,346,295 Total primary government $40,766,834 $54,729,304 $62,375,558 $60,002,738 Change in Net Position
Governmental activities ($19,815,094) ($3,276,516) $3,577,407 $10,697,356 Business-type activities (2,120,168) (2,735,995) 3,496,990 5,732,789 Total primary government ($21,935,262) ($6,012,511) $7,074,397 $16,430,145 116
For the Fiscal Year Ended June 30,
2016 2017 2018 2019 2020 2021
$29,591,108 $31,417,252 $33,069,899 $36,699,766 $37,261,483 $33,949,879 13,688,644 13,805,186 15,232,989 17,699,000 16,371,691 18,566,645 6,099,207 6,299,448 5,977,178 5,906,694 5,769,697 5,912,945 3,828,424 3,878,461 4,022,440 4,178,006 4,536,241 4,255,982 5,761,695 6,017,318 6,408,495 6,854,372 7,278,295 7,300,774 828,112 700,994 1,058,264 3,113,786 4,581,480 (109,320) 1,110,702 1,379,422 1,614,584 1,685,805 1,360,090 1,150,745 2,060,161 4,616,272 2,188,873 1,524,773 3,058,347 2,282,058 41,913 217,111 11,639 344,034
26,522,377
89,532,343 68,114,353 69,789,833 77,673,841 80,217,324 73,653,742 1,754,195 1,859,194 1,957,737 2,172,460 2,254,033 2,335,681 385,674 196,380 268,803 1,096,328 1,518,068 7,164
712,482 775,265 914,539 742,688 478,919 643,228
1,146 1,852
(2,060,161) (4,616,272) (2,188,873) (1,524,773) (3,058,347) (2,282,058) 4,579,613
792,190 2,794,180 952,206 2,486,703 1,193,819 705,867
$90,324,533 $70,908,533 $70,742,039 $80,160,544 $81,411,143 $74,359,609 $37,112,709 $1,093,623 $423,563 $9,964,420 $9,076,001 ($6,467,093) 6,772,748 7,622,417 833,167 6,254,975 3,830,084 2,736,173 $43,885,457 $8,716,040 $1,256,730 $16,219,395 $12,906,085 ($3,730,920) 117
CITY OF DALY CITY
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
2012 2013 2014 2015 2016
General Fund
Nonspendable $238,031 $178,570 $186,129 $194,403 $13,453,512 Restricted
Assigned 12,249,286 12,109,457 12,103,389 12,220,256 12,098,569 Unassigned 9,039,548 11,522,227 11,838,923 15,059,052 18,329,649 Total General Fund $21,526,865 $23,810,254 $24,128,441 $27,473,711 $43,881,730 All Other Governmental Funds
Nonspendable $2,211
Restricted $15,053,292 $18,829,210 $20,021,531 $17,933,698 19,742,741 Assigned 12,211,293 11,698,471 11,873,724 15,906,433 17,525,314 Unassigned
Total all other governmental funds $27,264,585 $30,527,681 $31,895,255 $33,840,131 $37,270,266 All Governmental Funds
Total Nonspendable $238,031 $178,570 $186,129 $194,403 $13,455,723 Total Restricted 15,053,292 18,829,210 20,021,531 17,933,698 19,742,741 Total Assigned 24,460,579 23,807,928 23,977,113 28,126,689 29,623,883 Total Unassigned 9,039,548 11,522,227 11,838,923 15,059,052 18,329,649 Total All Governmental Funds $48,791,450 $54,337,935 $56,023,696 $61,313,842 $81,151,996 (a) The change in total fund balance for the General Fund and other governmental funds is explained in Management's Discussion and Analysis.
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Thousands
Total Nonspendable Total Restricted
Total Assigned Total Unassigned
118
For the Fiscal Year Ended June 30,
2017 2018 2019 2020 2021
$17,721,519 $17,684,920 $15,927,953 $14,955,064 $13,875,487 3,016,958 3,198,748 3,382,363 3,746,447
12,111,209 12,047,395 12,291,473 12,663,807 375,051
22,681,817 22,589,341 34,684,815 42,666,860 44,913,148
$52,514,545 $55,338,614 $66,102,989 $73,668,094 $62,910,133 (a) $6,998 $29,668 $29,738 $34,625 $25,184
20,304,044 17,897,042 19,592,976 25,695,472 34,689,298
15,076,221 15,972,732 15,753,688 16,870,159 16,491,889
2,072 (86,950) (114)
$35,389,335 $33,899,442 $35,289,452 $42,600,256 $51,206,257 (a) $17,728,517 $17,714,588 $15,957,691 $14,989,689 $13,900,671 20,304,044 20,914,000 22,791,724 29,077,835 38,435,745
27,187,430 28,020,127 28,045,161 29,533,966 16,866,940
22,683,889 22,589,341 34,597,865 42,666,860 44,913,034
$87,903,880 $89,238,056 $101,392,441 $116,268,350 $114,116,390 119
2012 2013 2014 2015
Revenues
Taxes $56,413,948 $54,183,995 $58,493,320 $60,767,789
Licenses, permits and fees 1,409,698 1,578,457 1,697,703 2,679,745 Fines and forfeitures 2,440,465 2,420,754 2,301,580 2,740,510 Use of money and property 3,132,897 1,050,149 1,864,656 1,499,885 Intergovernmental revenues 7,267,441 4,366,743 3,511,403 6,092,246 Charges for services 7,637,246 7,479,277 7,757,549 12,763,912 Other 4,044,012 4,748,815 4,615,471 5,307,064
Total Revenues 82,345,707 75,828,190 80,241,682 91,851,151 Expenditures
Current:
General government 8,682,126 8,194,893 10,882,785 9,495,891 Public safety 42,226,973 42,150,729 42,737,888 44,972,711 Public works 4,995,361 4,726,801 4,712,465 7,053,586
Culture and recreation 12,650,231 12,105,970 11,932,443 10,085,356 Community development 5,773,301 4,666,975 3,896,212 4,917,443 Capital projects 6,977,961 4,336,490 4,149,538 4,359,239 Debt service:
Principal repayment 2,679,000 212,000 227,000 244,000
Interest and fiscal charges 312,381 181,942 170,919 235,066 Total Expenditures 84,297,334 76,575,800 78,709,250 81,363,292 Excess (deficiency) of revenues over
(under) expenditures (1,951,627) (747,610) 1,532,432 10,487,859 Other Financing Sources (Uses)
Sale of property 5,787 18,057 (3,003,763)
Amount paid to State (3,750,000)
Transfers in 5,753,543 5,812,723 5,523,006 6,306,265
Transfers out (2,838,147) (2,903,573) (5,369,677) (4,750,215) Loan proceeds
Contributions
Total other financing sources (uses) 2,921,183 2,927,207 153,329 (5,197,713) Extraordinary items
Assets transferred to/liabilities assumed by
Successor Agency (18,543,965) 3,366,888
Net Change in fund balances ($17,574,409) $5,546,485 $1,685,761 $5,290,146 Debt service as a percentage of
noncapital expenditures 3.7% 4.0% 0.5% 0.6%
CITY OF DALY CITY
Changes in Fund Balance of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
For the Fiscal Year Ended June 30,
120
For the Fiscal Year Ended June 30,
2016 2017 2018 2019 2020 2021
$61,030,589 $63,536,267 $66,939,056 $75,573,768 $75,484,516 $74,390,755 2,889,367 3,023,889 2,727,875 2,970,667 3,013,080 2,981,237 3,442,372 3,850,382 3,678,828 3,379,319 3,700,904 3,040,526 1,841,802 1,636,285 2,040,295 3,831,438 5,007,732 564,446 4,218,152 5,526,235 5,378,283 8,922,550 14,405,495 13,652,973 14,632,874 9,771,337 9,992,458 11,417,260 12,764,998 9,035,012 5,527,147 4,989,727 6,785,029 2,293,810 1,936,781 2,824,687 93,582,303 92,334,122 97,541,824 108,388,812 116,313,506 106,489,636 10,777,041 10,067,504 10,259,919 9,076,400 10,354,151 12,823,394 49,047,952 50,681,833 51,147,772 54,547,977 56,894,801 63,791,207 7,589,698 8,480,954 8,895,892 9,173,452 9,588,658 9,426,845 10,569,151 10,802,067 10,637,826 11,624,964 11,946,087 10,196,627 4,306,935 4,340,191 5,115,492 4,531,036 4,841,980 5,476,383 5,726,698 10,019,069 6,927,154 7,201,911 10,683,817 9,639,122 260,000 279,000 298,000 319,000 341,000 365,000
28,730 41,216 38,672 35,165 29,838 23,020
88,306,205 94,711,834 93,320,727 96,509,905 104,680,332 111,741,598 5,276,098 (2,377,712) 4,221,097 11,878,907 11,633,174 (5,251,962) 1,600 262,490 179,922 11,639 379,095
5,561,713 6,633,748 4,030,049 6,278,010 8,486,521 13,712,986 (4,776,760) (2,346,255) (7,096,892) (6,014,171) (5,243,786) (10,992,079) 786,553 4,549,983 (2,886,921) 275,478 3,242,735 3,100,002 4,579,613
$6,062,651 $6,751,884 $1,334,176 $12,154,385 $14,875,909 ($2,151,960)
0.3% 0.3% 0.4% 0.4% 0.4% 0.4%
121
Fiscal Total
Year Total Total Direct
Ended Assessed Assessed Tax
June 30 Secured Unsecured Exemptions Value (1) Secured Unsecured Exemptions Value (1) Rate (2) 2012 8,287,585$ 242,088 $ 103,652$ 8,633,325$ 860,939$ 53,608 $ 6,507 $ 921,054$ 1.00% 2013 8,391,284 237,106 102,195 8,730,585 893,143 50,023 6,516 949,682 1.00% 2014 8,951,230 227,850 100,563 9,279,643 929,050 51,354 6,413 986,817 1.00% 2015 9,426,340 239,970 99,548 9,765,858 980,736 53,445 6,373 1,040,554 1.00% 2016 9,962,576 257,377 98,669 10,318,622 1,011,512 57,075 6,370 1,074,957 1.00% 2017 10,556,650 238,395 97,391 10,892,436 1,050,088 56,063 6,304 1,112,455 1.00% 2018 11,167,466 240,562 96,204 11,504,232 1,102,164 59,029 6,066 1,167,259 1.00% 2019 12,442,279 258,770 95,428 12,796,477 1,175,698 6,187 6,038 1,247,923 1.00% 2020 12,878,232 259,710 94,427 13,232,369 1,294,087 65,154 6,016 1,365,257 1.00% 2021 13,483,669 252,523 93,566 13,829,758 1,299,577 64,182 5,985 1,369,744 1.00% (1)
(2)
Source: San Mateo Count y Controller's Office Annual Publication: Tax Rates and Valuation of Taxable Property City Redevelopment Agency
California cities do not set their own direct tax rate. The State Constitution establishes the rate at 1% and allocates a portion of that amount by an annual calculation to all the taxing entities within a tax rate area.
CITY OF DALY CITY
ASSESSED VALUE OF TAXABLE REAL PROPERTY
LAST TEN FISCAL YEARS
(in thousand dollars)
plus an increment of no more than two percent annually. These values are considered to be full market values.
The State Constitution requires properties to be assessed at one hundred percent of the most recent purchase price, $0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total City Assessed Value
Total Redevelopment Agency Assessed Value
122
ALL OVERLAPPING GOVERNMENTS
LAST TEN FISCAL YEARS
Basic Jefferson Jefferson South San Francisco
County Elementary High San Mateo Unified Pacifica
Fiscal Wide School School Junior School Elementar y
Year Lev y District District Colle ge District School Total 2012 1.0000 0.0422 0.0199 0.0422 1.1043
2013 1.0000 0.0430 0.0194 0.0432 1.1056
2014 1.0000 0.0713 0.0574 0.0194 1.1481
2015 1.0000 0.0662 0.0530 0.0190 1.1382
2016 1.0000 0.0674 0.0583 0.0250 0.0457 0.0250 1.2214
2017 1.0000 0.0680 0.0800 0.0247 0.0467 0.0311 1.2505
2018 1.0000 0.0663 0.0816 0.0235 0.0366 0.0281 1.2361
2019 1.0000 0.0563 0.0739 0.0175 0.0422 0.0517 1.2416
2020 1.0000 0.0667 0.0811 0.0267 0.0381 0.0505 1.2631
2021 1.0000 0.0667 0.0942 0.0213 0.0350 0.0415 1.2587
Notes:
Source: San Mateo Count y Controller's Office Annual Publication: Tax Rates and Valuation of Taxable Property
CITY OF DALY CITY
In 1979, State Proposition 13 amended the constitution to provide that the general tax rate be limited to one percent of market value, distributed among all tax agencies. Assessed valuation is set at 100 percent of market value at transfer of title and the tax rate is $1 per $100 of assessed value.
The City of Daly City has 67 tax code areas, many with different rates because of differing school district boundaries. The highest tax rate is shown here.
(Rate per $100 of Assessed Value)
LAST TEN FISCAL YEARS
DIRECT AND OVERLAPPING PROPERTY TAX RATES
0.0 0.2
0.4 0.6
0.8 1.0
1.2 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Rate Per Hundred $
San Mateo Junior College Pacifica Elementary School
South San Francisco Unified School District Jefferson High School District Jefferson Elementary School District Basic County Wide Levy 123
2020-2021 2011-2012
Percentage Percentage
of Total City of Total City
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxpayer Value Ran k Value Value Ran k Value
Daly City Serramonte Center LLC 481,940,192$ 1 3.48% 114,844,105 5 1.33% Westlake Assoc Lessee 287,655,607 2 2.08% 116,436,973 4 1.35% Kimco Westlake Lp 172,695,147 3 1.25% 149,151,543 2 1.73% Dc Station Owner Llc 119,157,940 4 0.86%
Skyline Heights Llc 94,323,998 5 0.68% 47,419,037 6 0.55% SP Peninsula Del Rey LLC 69,109,170 6 0.50% Verity Holdings LLC 54,787,899 7 0.40%
EQR Hillside LP 45,837,091 8 0.33%
Franciscan Park LLC 40,610,797 9 0.29% 39,682,321 8 0.46% Jefferson Union High Sch Dist 39,751,179 10 0.29% Db Real Estate Pacific Plaza P - 140,275,489 3 1.62% RMP Properties (Mission Plaza) - 33,850,919 10 0.39% Wasl Daly City Investors V - 42,638,074 7 0.49% Serramonte Corporate Center Ll - 38,280,011 9 0.44% Seton Medical Center - 198,483,902 1 2.30% Subtotal 1,405,869,020$ 10.17% 921,062,374$ 10.67% Total Assessed Valuation:
Fiscal Year 2020-2021 $13,829,758,602
Fiscal Year 2011-2012 $8,633,324,695
Source: San Mateo County Assessor Fiscal Year Combined Tax Rolls MuniServices, LLC
CITY OF DALY CITY
Principal Property Tax Payers
Current Year and Nine Years Ago
124
CITY OF DALY CITY
PROPERTY TAX LEVIES AND COLLECTIONS
LAST TEN FISCAL YEARS
(in thousand dollars)
#
#
#
Current Percent Delinquent Total Percent of Total
Fiscal Total Tax of Levy Tax Tax Tax Collections
Year Tax Levy (a) Collections Collected Collections Collections to Tax Levy 2012 15,236$ 15,236 $ 100.00% 15,236$ 100.00% 2013 15,555 15,555 100.00% 15,555 100.00%
2014 16,713 16,713 100.00% 16,713 100.00%
2015 17,543 17,543 100.00% 17,543 100.00%
2016 18,675 18,675 100.00% 18,675 100.00%
2017 19,707 19,707 100.00% 19,707 100.00%
2018 20,800 20,800 100.00% 20,800 100.00%
2019 23,057 23,057 100.00% 23,057 100.00%
2020 23,820 23,820 100.00% 23,820 100.00%
2021 24,536 24,536 100.00% 24,536 100.00%
Source: City of Daly City
NOTE:Current tax collections beginning in 1993 have been reduced by a mandatory tax reallocation imposed by the State of California
(a) Beginning fiscal year 1995, the County began providing the City 100% of its tax levy under the "Teeter Plan", an agreement which allows the County to keep all interest and delinquency charges collected.
$12,000
$13,000
$14,000
$15,000
$16,000
$17,000
$18,000
$19,000
$20,000
$21,000
$22,000
$23,000
$24,000
$25,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total Tax Levy (a) Tax Collections
125
HUD PERS Pension
Fiscal Capital Section 108 Obligation
Year Lease Loan Bonds Total
2012 3,353,000 $ 31,060,000 $ 34,413,000 $
2013 3,141,000 29,810,000 32,951,000
2014 2,914,000 28,380,000 31,294,000
2015 2,670,000 26,755,000 29,425,000
2016 2,410,000 24,915,000 27,325,000
2017 2,131,000 22,845,000 24,976,000
2018 1,833,000 20,520,000 22,353,000
2019 1,514,000 17,920,000 19,434,000
2020 1,173,000 15,025,000 16,198,000
2021 1,483,056$ 808,000 11,810,000 14,101,056
Water State Water Total Percentage o
f
Fiscal Certificates Water Resources Primary Personal Per Year of Participation Revenue Bond Board Loan Total Government Income (a) Capita (a) 2012 6,800,000$ 3,172,805$ 9,972,805$ 44,385,805$ 1.51% 429.48 2013 $6,330,000 2,963,246 9,293,246 42,244,246 1.43% 402.04 2014 5,815,000 2,748,449 8,563,449 39,857,449 1.33% 376.69 2015 5,290,000 2,528,282 7,818,282 37,243,282 1.22% 343.14 2016 4,750,000 2,302,610 7,052,610 34,377,610 0.90% 319.10 2017 4,205,000 2,071,298 6,276,298 31,252,298 0.90% 290.09 2018 3,640,000 1,834,202 5,474,202 27,827,202 0.69% 257.98 2019 3,065,000 1,591,179 4,656,179 24,090,179 0.60% 220.44 2020 2,480,000 1,342,080 3,822,080 20,020,080 0.54% 184.35 2021 1,880,000 1,086,754 2,966,754 17,067,810 N/A N/A
Note : Debt amounts exclude any premiums, discounts, or other amortization amounts.
Sources: Cit y of Daly City
State of California, Department of Finance (population) (a) See Demographic Statistics for population and personal income data.
CITY OF DALY CITY
Business-Type Activities
Last Ten Fiscal Years
Ratio of Outstanding Debt by Type
Governmental Activities
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
$40,000,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total Governmental Activities Total Business-Type Activities 126
Fiscal Pension Percentage o f
Year Ended Obligation Personal Per
June 30 Bonds Income (a) Capita (a)
2012 31,060,000$ 1.06% 300.54$
2013 29,810,000 1.01% 283.70
2014 28,380,000 0.94% 268.22
2015 26,755,000 0.88% 246.50
2016 24,915,000 0.65% 231.27
2017 22,845,000 0.66% 211.79
2018 20,520,000 0.51% 188.05
2019 17,920,000 0.45% 164.22
2020 15,025,000 0.40% 138.35
2021 11,810,000 N/A N/A
Sources: Cit y of Daly City
State of California, Department of Finance (population) (a) See Demographic Statistics for population and personal income data.
Last Ten Fiscal Years
CITY OF DALY CITY
Ratio of General Bonded Debt Outstanding
127
CITY OF DALY CITY
COMPUTATION OF DIRECT AND OVERLAPPING DEBT
JUNE 30, 2021
2020-2021 Assessed Valuation 13,829,758,602 $
Total Debt City’s Share of
OVERLAPPING TAX AND ASSESSMENT DEBT 06/30/21 % Applicable (1) Debt 06/30/21 San Mateo Community College District 761,305,961 $ 5.401% 41,118,135 $ South San Francisco Unified School District 163,485,887 7.527% 12,305,583 Jefferson Union High School District 265,554,630 49.670% 131,900,985 Bayshore School District 11,644,821 80.600% 9,385,726
Brisbane School District 15,356,439 15.139% 2,324,811
Jefferson School District 121,720,000 86.495% 105,281,714 TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT 302,316,954
DIRECT AND OVERLAPPING GENERAL FUND DEBT
San Mateo County General Fund Obligations 640,119,345$ 5.401% 34,572,846 San Mateo County Board of Education Certificates of Participation 6,840,000 5.401% 369,428 San Mateo County Flood Control District Certificates of Participation 15,425,000 27.437% 4,232,157 South San Francisco Unified School District Certificates of Participation 3,185,000 7.527% 239,735 Jefferson Union H.S.D. Certificates of Participation 47,490,000 49.670% 23,588,283 City of Daly City Pension Obligation Bonds 11,810,000 100.000% 11,810,000 HUD Section 108 Loan 808,000 100.000% 808,000
TOTAL DIRECT AND OVERLAPPING GENERAL FUND DEBT 75,620,449 TOTAL DIRECT DEBT 12,618,000
TOTAL OVERLAPPING DEBT 365,319,403
COMBINED TOTAL DEBT 377,937,403$ (2)
(1)
(2)
Ratios to 2020-21 Assessed Valuation
Total Overlapping Tax and Assessment Debt 2.19%
Total Direct Debt ($12,618,000) 0.09%
Combined Total Debt 2.73%
Source: California Municipal Statistics, Inc.
Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue bonds and non-bonded capital lease obligations.
The percentage of overlapping debt applicable to the city is estimated using taxable assessed property value. Applicable percentages were estimated by determining the portion of the overlapping district's assessed value that is within the boundaries of the city divided by the district's total taxable assessed value. 128
CITY OF DALY CITY
COMPUTATION OF LEGAL BONDED DEBT MARGIN
JUNE 30, 2021
ASSESSED VALUATION:
Total property assessed value, net of
exempt real property $13,829,758,602
BONDED DEBT LIMIT (3.75% OF ASSESSED VALUE) (a) $518,615,948 AMOUNT OF DEBT SUBJECT TO LIMIT:
Total Bonded Debt (b) $1,880,000
Less: Revenue Bonds and Certificate of
Participation not subject to limit 1,880,000
Amount of debt subject to limit 0
LEGAL BONDED DEBT MARGIN $518,615,948
Total net debt
Total Net Debt Legal applicable to the limit
Fiscal Debt Applicable to Debt as a percentage
Year Limit Limit Margin of debt limit
2012 323,750$ 0 323,750$ 0.00%
2013 327,397 0 327,397 0.00%
2014 347,987 0 347,987 0.00%
2015 366,220 0 366,220 0.00%
2016 386,948 0 386,948 0.00%
2017 408,466 0 408,466 0.00%
2018 431,408 0 431,408 0.00%
2019 479,868 0 479,868 0.00%
2020 492,637 0
492,637 0.00%
2021 515,037 0 515,037 0.00%
NOTE:
(a)
California Government Code Section 43605 sets the debt limit at 15%. The Code section was enacted prior to the change in basing assessed value to full market value when it was previously 25% of market value. Thus, the limit shown as 3.75% is one-fourth the limit to account for the adjustment of showing assessed valuation at full cash value.
(b)
2012 Water Revenue Refunding Bond
(in thousand dollars)
129
NUMBER OF CONNECTIONS BY USERS
Category Number of Connections Category Number of Connections Residential 20,202 Residential 20,375
Multi-Family 1,821 Mulit-Family 1,852
Commercial 776 Commercial 839
City/Government 197 City/Government 256
Traveling Meter 18 Traveling Meter 64
-
Total Connections 23,014 Total Connections 23,386
WATER UTILITY FUND CERTIFICATES OF PARTICIPATION
HISTORICAL REVENUES, EXPENDITURES AND BOND COVERAGE
LAST TEN FISCAL YEARS
2012 2013 2014 2015 2016
Gross Revenues (1) 15,185,857$ 16,801,668 $ 18,931,871 $ 20,425,104 $ 17,186,361 $ Operating Expenses
(including depreciation) (2) 12,718,342 13,910,737 13,276,951 14,354,432 15,950,589 Depreciation (1,257,540) (1,263,850) (1,261,733) (1,255,728) (1,274,779) Operating Transfers Out 2,372,007 2,587,195 2,318,226 2,378,434 1,689,464 Total Operating Expenses 13,832,809 15,234,082 14,333,444 15,477,138 16,365,274 Net Revenue Available for Debt 1,353,048$ 1,567,586$ 4,598,427$ 4,947,966$ 821,087$ Total Debt Service Requirement 751,621$ 649,531$ 647,050$ 647,750$ 651,250$ Coverage 1.8 2.41 7.11 7.64 1.26
Notes: (1) Includes all Water Utility Operating Revenue, and Nonoperating Revenue including Nonoperating Interest Income and Transfers in (2) Includes all Water Utility Operating Expenses
(3) New utility billing software reporting number of connections in new categories Source: City of Daly City Annual Financial Statements
AS OF JUNE 30,2020 AS OF JUNE 30, 2021
CITY OF DALY CITY
WATER UTILITY FUND
130