Daly City City Council
February 24, 2025

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 90th 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 24, 2025 - 7:00 PM

City Hall Council Chambers – 2nd Floor
City Hall 333 – 90th Street
Daly City, CA 94015
To watch the live telecast:
https://www.youtube.com/@DalyCityGov/streams, https://www.dalycity.org/agendas, or Comcast Ch. 27

PUBLIC PARTICIPATION
There are three ways to submit public comments: (1) submit written comments by meeting day, (2) submit written comments during the meeting, and (3) attend the meeting in person.

1. To submit written comments by meeting day, please email [email protected] and include “Public Comment” in the subject line. All written comments received by 4:00 pm on meeting day will be provided to the City Council prior to the meeting.

Please note: Any emailed comments received after 4:00 p.m. on the meeting date are not guaranteed to be received by the City Council prior to the meeting. Comments are not read aloud into the record.

2. During the meeting, you may visit www.dalycity.org/agendas to submit comments using the Public Comment form to address the City Council on a specific item, or during the public comment period, and such comments are delivered to the City Council and City Staff during the meeting, and may be read into the record at the time they are received.

3. To speak at the meeting in person, please complete a Speaker Card located at the entrance to the Council Chamber and submit it to a Staff Member as early in the meeting as possible.

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 (650) 991-8078 as soon as possible.

CALL TO ORDER
The City of Daly City acknowledges that we are on the ancestral lands of the Ramaytush (rahmy-toosh) Ohlone (O-lon-ee) peoples. We recognize their enduring connection to this region and honor their history, culture, and contributions. As the Indigenous protectors of this land, we affirm their sovereign rights as the original inhabitants of this land and pay respects to the Ancestors, Elders, and Relatives of the Ramaytush Ohlone peoples.

PLEDGE TO THE FLAG:

Agenda – City Council
Monday, February 24, 2025

ROLL CALL:

PRESENTATIONS:

1. Information Technology (IT) Master Plan Executive Summary

2. Proclamation - Teen Dating Violence Awareness and Prevention Month, Liezel Chan Lucero

3. Proclamation - 100th Anniversary of Teamsters Local 665 APPROVAL OF MINUTES:

4. Regular Meeting of February 10, 2025
APPROVAL OF AGENDA:

5. Regular Meeting of February 24, 2025
ORAL COMMENT:

NOTE: Speakers are limited to two minutes, unless modified by the Mayor.

The Council cannot take action on any matter raised under this item.

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:

6. Accept the Fiscal Year 2024 Annual Comprehensive Financial Report

7. Accept 2024 QTR 4 Investment Report
Resolutions:

8. Accept the Information Technology (IT) Master Plan

9. Authorize the City Manager or Designee to Execute an Addendum Agreement with Plante Moran

10. Accept and Appropriate Fiscal Year 2025 Mid-Year Operating Budget Adjustments

11. Accept and Appropriate Fiscal Year 2025 Mid-Year Capital Improvement Program Budget Adjustments

Agenda – City Council
Monday, February 24, 2025

12. Accept Public Service Utility Easement and Emergency Vehicle Access Easement from KB Home South Bay, Inc. – Point Martin I

13. Authorize Submission of a Grant Application to City/County Association of Governments of San Mateo County and San Mateo County Transportation Authority for the FY 2025/2026 and FY 2026/2027 San Mateo County Shuttle Program

14. Commend Leslie DuBridge on the Occasion of her Retirement Check Registers:

15. Check Registers for the Month of January 2025

END OF CONSENT AGENDA
COMMUNICATIONS:

16. Approve Annual Agreement between the City of Daly City and the Daly City Colma Chamber of Commerce for a 12-month Period
STAFF: Maybelle Manio
RECOMMENDATION: Adopt Resolution by Roll Call Vote
PUBLIC HEARINGS:

17. General Plan Amendment GPA-11-22-015959, Zone Change ZC-1-22-015960, Use Permit UPR-11-22-015962 Design Review DR-11-22-015961, and Development Agreement - Allowing the Construction of a Battery Energy Storage System and Transmission Line Connection at 2150 Geneva Avenue
STAFF: Sam Fielding
RECOMMENDATION: Open/Close Hearing
Motion for City Attorney to Read by Title Only
Councilmember Introduce Ordinances
Adopt Resolutions by Roll Call Vote
AWARD OF BIDS/CONTRACTS:

18. Award of Construction Contract for the RO 572 Street Light Conversion Project STAFF: Richard Chiu, Jr.

RECOMMENDATION: Adopt Resolution by Roll Call Vote

Agenda – City Council
Monday, February 24, 2025

APPOINTMENTS: Board/Commission Membership Committee Appointments REPORTS:

19. Council Committee

20. City Council

21. Staff
ADJOURNMENT:

IT Master Plan
Daly City – Executive Summary – January 2025
1

IT Master Planning
2

IT Master Planning Process
3 DISCOVERY ANALYSIS IT MASTER PLAN
Mission and
strategic goals
Roadmap of
initiatives
Prioritization
criteria and
metrics
People
Technology Process
Visioning
IT Assessment
Current state
assessment
Technology best
practices
Target future
state
City’s strategic
direction

IT assessment
summary
4

IT assessment summary – part 1
Areas of recognition
 Effective coordination and communication exists between the IS Manager and the City's Finance and Administrative Services Director, which is required to elevate technology planning and decision-making to the executive leadership level.  Departments throughout the City feel that overall, the Information Services Division (ISD) is supportive and responsive, are satisfied with the direction and leadership of ISD, and think that technology improvements can positively impact the City’s overall objectives.  Basic preventive, detective, and corrective security controls are in place, which address a large number of common threats.
 There is an initiative in place to refresh end-of-life (EoL) networking equipment. 5

IT assessment summary – part 2
6 Opportunities for improvement
 Lack of a formalized risk-based cybersecurity program and dedicated cybersecurity role, as well as missing critical information security policies.  No overarching IT strategy, governance model, and policy framework to guide technology investments and decision-making. In particular, no disaster recovery or incident response plans.
 Lack of formalized and efficient IT operations and project management practices, including help desk support processes, change management, end-user communications, etc.
 Significant technical debt associated with an historical lack of investment in technology and previous practices of deferring technology updates, which includes end-of-life network elements, workstations, server operating systems, telephony platform, and cabling systems.
 Systemic issues with key enterprise applications, including Finance Enterprise and EnerGov (both of which are in the process of being addressed), as well as ongoing issues with other applications. Page 10 of 818
IT Master Plan

Mission statement
8 Mission Statement for ISD
To empower Daly City through stable and secure
high performance technology solutions that
support the City’s operations, enhance the
services provided by the different City
departments to the community, and promote
continuous growth.

Proposed strategic goals
9 Enhance cybersecurity and
data protection
Make financially sustainable
and environmentally conscious
technology investments
Operate a high-performance
technology environment
Empower City departments and
workforce through technology

Strategic goals detail
10 Enhance Cybersecurity and data protection
Implement a risk-based cybersecurity program, and additional cybersecurity controls and best practices, to safeguard city data and infrastructure.

Operate a high-performance technology environment
Maintain a highly available, high-performance technology infrastructure environment by following IT best practices to provide reliable and consistent services to the community.

Make financially sustainable and environmentally conscious technology investments Make viable, sustainable, and environmentally conscious technology investments and efficient use of financial and human capital resources to support the City’s goals.

Empower City departments and workforce through technology Enable City departments to leverage technology effectively to accomplish their business objectives and better serve the community through close collaboration under a shared responsibility model for technology.

Supporting themes
11 Security Performance Investment Empowerment
• Risk-based cybersecurity
program, incl.
• Dedicated
cybersecurity position
• Enhance user
awareness training
• Data center
safeguards
• Migrate unsupported
server Oss
• Etc.
• Policy framework
• IT asset lifecycle
management
• IT operations and project
management best
practices
• Internet failover, data
backup, business
continuity and disaster
recovery capabilities
• IT Master Plan
• Comprehensive
technology budget
• Technology refresh cycle
• Sourcing strategy
• Formalize vendor and
vendor risk management
practices
• ISD staffing levels
• IT governance model
• Applications and data
architecture, incl.
• ERP replacement and
workflows
• EnerGov improvement
• Policy record
management system
• Enhance end user
communications and
training
• IT service catalog and selfhelp capabilities

IT alignment
12 City’s guiding principles
 Foster economic vitality and financial sustainability  Enhance quality of life for residents
 Promote an aesthetic community environment
 Facilitate community building and civic engagement
 Create “healthy citizen/healthy community” opportunities City’s priorities
 Economic development and revenue enhancement to ensure long-term fiscal sustainability
 Effective and efficient government operations
 Transportation and traffic improvements
 Affordable housing
 Public safety
 Infrastructure
 Land use
 Community and civic support
 Leisure services
Empowerment
Investment
High-performance
Cybersecurity
ISD’s strategic goals

Project prioritization
criteria and metrics
13

Proposed project prioritization criteria
14 Criteria
Return on investment, cost reduction, and risk mitigation, considering total cost of ownership
Community impact via improved services, availability, and external stakeholder satisfaction
Optimization of internal IT and departmental process
efficiency and employee satisfaction
Weight
40%
20%
40%
Notes:
• Each project can be scored on a scale of 1 to 5 for each criterion, with 1 being the lowest and 5 being the highest. The total score for each project will be calculated adding the score of each criterion multiplied by the weight assigned to such criterion. • Regulatory/compliance items will not be scored but considered mandatory and highest priority.

Key performance indicators
IT performance metrics
Completion of projects in the IT strategic plan assigned to each year
Network uptime
Percentage of tickets resolved within SLA
Percentage of IT assets tracked and current
Failure rate for phishing tests
15 Target
> 90%
> 99% (i.e., 87.6 hours of downtime/year)
> 90% (i.e., 9 out of 10)
> 99% (e.g., 6 PCs out of 600 outdated)
< 2% (i.e., 2 out of every 100 staff)

Next steps
16

Next steps
•     Form IT steering committee
•     Approve the IT Master Plan
•     Determine budget for year 1 execution of the plan •     Review project prioritization
•     Begin execution of highest priority projects
•     Measure performance at end of year 1
17

Thank You!
18

Proposed governance model
19 Governance structure Key functions
Board (or equivalent) • Approve IT strategic plan
• Approve technology budget
• Approve policies
IT steering committee • Recommend IT strategy, develop, and maintain IT strategic plan • Review IT requests, identify priorities, and align with IT budget • Identify KPIs to assess IT success
• Monitor progress against IT strategic plan and KPIs
• Recommend IT-related policy changes as appropriate
ISD leadership • Represent the technology function at the executive leadership level • Maintain a strategic plan and develop policy framework • Oversee project portfolio and develop technology roadmaps • Manage service delivery and risk
• Develop ISD staff
ISD staff • Implement, maintain, and support City-wide technologies • Develop documentation, procedures, and standards
• Provide help desk/end-user support
• Manage IT projects and vendors
• Manage cybersecurity operations
Functional departments’ staff • Formalize IT or IT liaison roles that follow ISD policies • Lead departmental-specific technology projects with ISD support • Provide subject matter expertise related to business processes • Act as application and data domain owners
• Provide department support for business-related issues

Proposed policy framework
20 Overarching policy or category Components or associated policies Acceptable use policy (UAP)
Computer and internet usage policy
Mobile and personal device policy
Email usage policy
Social media policy
Portable and cloud storage policy
Generative artificial intelligence (AI) policy
Information security policy
User awareness training (UAT) policy
Password policy
User access policy
User identification, authentication, and authorization policy Anti-malware policy
Security penetration testing policy
Monitoring and logging policy
Remote access policy
IT operations policies and procedures
IT governance policies
Technology procurement policy and standards
Help desk policy and procedures
IT asset management policy
Change management policy
Infrastructure refresh policy
Patch management policy
Business continuity policies and plans
Data backup policy
Data management and retention policy
Business continuity and disaster recovery plan
Incident response plan

Proclamation
Teen Dating Violence Awareness and
Prevention Month
WHEREAS, young individuals aged 16 to 24 are at a heightened risk of intimate partner violence, experiencing abuse at rates nearly triple the national average; and WHEREAS, one in three adolescent girls in the United States endures physical, emotional, or verbal abuse from a dating partner, surpassing victimization rates for other youth violence; and WHEREAS, victims of teen dating violence often engage in risky sexual behaviors and unhealthy dieting, adversely affecting self-esteem and body image development; and WHEREAS, only 33% of teens in abusive relationships disclose the abuse, and 81% of parents either believe teen dating violence isn't an issue or are unaware of its prevalence; and WHEREAS, educating young people about healthy relationships and reshaping attitudes that tolerate violence are essential steps in preventing dating violence; and

WHEREAS, every individual deserves a healthy, abuse-free relationship, and recognizing Teen Dating Violence Awareness and Prevention Month benefits our youth, families, schools, and the broader Daly City community, irrespective of socioeconomic status, gender, sexual orientation, or ethnicity; and
WHEREAS, the City of Daly City stands in solidarity with survivors, advocates, educators, and organizations working to prevent teen dating violence by promoting awareness, providing support services, and fostering a culture of respect and healthy relationships within our community; and
WHEREAS, with a commitment to fostering youth engagement, Councilwoman Juslyn Manalo, in collaboration with mother Liezel Chan, is creating a youth program in honor of Frances Kendra Lucero Chan’s life. This program aims to empower and uplift youth while promoting healthy relationships and wellness.

NOW, THEREFORE, I, DR. RODERICK DAUS-MAGBUAL, Mayor of Daly City, on behalf of the City Council, do hereby proclaim February 2025 as “Teen Dating Violence Awareness and Prevention Month in Daly City”. The City of Daly City reaffirms its commitment to empowering our youth with knowledge and resources to foster healthy relationships, supporting survivors in accessing necessary services, and engaging the community in proactive discussions to eradicate teen dating violence.

Signed and sealed by the Mayor and City Council of the City of Daly City this 24th day of February 2025.

Dr. Roderick Daus-Magbual, Mayor
Glenn R. Sylvester, Vice Mayor
Juslyn C. Manalo, Councilmember
Pamela DiGiovanni, Councilmember
Teresa G. Proaño, Councilmember

Proclamation
100TH ANNIVERSARY OF TEAMSTERS LOCAL 665
WHEREAS, Teamsters Local 665 has proudly served the workforce of the San Francisco Bay Area since its establishment on January 25, 1925, advocating for fair wages, safe working conditions, and the rights of workers across multiple industries; and WHEREAS, for a century, Local 665 has been instrumental in securing strong labor contracts and benefits for its more than 6,000 members, spanning across eight counties, including those who live and work in the City of Daly City; and
WHEREAS, Local 665 has contributed to the betterment of working families in transportation, parking, solid waste management, and other key industries, ensuring job stability and improved quality of life for countless workers; and
WHEREAS, under the leadership of Principal Officer Tony Delorio, a third-generation Teamster, Local 665 continues to uphold the values of solidarity, fairness, and advocacy, expanding union membership and strengthening labor rights in Daly City and beyond; and WHEREAS, Tony Delorio is the Principal Officer of Teamsters Local Union No. 665 and an executive Board Officer of the Teamsters Joint Council No. 7. Together, these trade union bodies represent 100,000 hard-working men and women throughout Northern California, the Central Valley, and Northern Nevada. Delorio leads and oversees labor contract negotiations, spearheads union organizing and legislative outreach, benefiting Teamster members employed in a variety of industrial professions including transportation, hospitality services, airport logistics, and the construction industry; and WHEREAS, as Teamsters Local 665 commemorates its 100th anniversary, the City of Daly City recognizes and honors its commitment, dedication, and profound impact on the labor movement and our local workforce.

NOW, THEREFORE, I, DR. RODERICK DAUS-MAGBUAL, Mayor, and members of the City Council, do hereby recognize and commend Teamsters Local 665 for its century-long service and unwavering commitment to labor rights and working families, and extend our congratulations on this historic milestone.

Signed and sealed by the Mayor and City Council of the
City of Daly City this 24th day of February 2025.

Dr. Roderick Daus-Magbual, Mayor
Glenn R. Sylvester, Vice Mayor
Juslyn C. Manalo, Councilmember
Pamela DiGiovanni, Councilmember
Teresa G. Proaño, Councilmember

CITY OF DALY CITY
MINUTES – REGULAR MEETING – CITY COUNCIL
FEBRUARY 10, 2025
--------------------------------
Note on Public Comments:

To provide public comments, members of the public have the option to- 1) attend in person, 2) email the City Clerk, or 3) submit comments through the public comment portal on the City’s website. Persons with disabilities who require auxiliary aids or services in attending or participating in this meeting are instructed to call the office of the City Clerk at 991-8078 prior to the meeting.

Visit https://www.youtube.com/@DalyCityGov/streams to view the City Council meeting CALL TO ORDER:

Mayor Daus-Magbual called the regular meeting to order at 7:00 P.M. and read the City’s Land Acknowledgement:

The City of Daly City acknowledges that we are on the ancestral lands of the Ramaytush (rah-my-toosh) Ohlone (O-lon-ee) peoples. We recognize their enduring connection to this region and honor their history, culture, and contributions. As the Indigenous protectors of this land, we affirm their sovereign rights as the original inhabitants of this land and pay respects to the Ancestors, Elders, and Relatives of the Ramaytush Ohlone peoples.

ROLL CALL: Councilmembers Present:

Roderick Daus-Magbual, Mayor
Glenn R. Sylvester, Vice Mayor
Pamela DiGiovanni
Juslyn C. Manalo
Teresa G. Proaño
Staff Present:

Thomas J. Piccolotti, City Manager
Rose L. Zimmerman, City Attorney
K. Annette Hipona, City Clerk
PRESENTATIONS:

Proclamation - Black History Month 2025
(Noble Fields)
Proclamation - Perla Ibarrientos 90th Birthday
(Tita Perla Ibarrientos)
HIP Housing's 2025 Calendar Contest Winner
(HIP Housing Fund Development Director Sabrina Wilson and HIP Housing Board Member Alan Underwood)
APPROVAL OF MINUTES:

Regular Meeting of January 27, 2025
It was moved by Councilmember Manalo, seconded by Councilmember DiGiovanni and carried to approve the minutes of January 27, 2025.

CITY OF DALY CITY
MINUTES – REGULAR MEETING – CITY COUNCIL
FEBRUARY 10, 2025
2 APPROVAL OF AGENDA:

It was moved by Councilmember Manalo, seconded by Councilmember Proaño and carried to approve the agenda.

ORAL COMMENT:

Andrew Siri, owner of Auto Sound Performance (Daly City), referred to an email that was sent to the Council and City Management requesting information on City procedures for procuring equipment, and requested follow-up on the email. Andrew recommended to have opportunities and support for Daly City’s small businesses like Auto Sound Performance within the City’s procurement process.

CONSENT AGENDA:

It was moved by Councilmember Manalo, seconded by Councilmember DiGiovanni and carried to approve the consent agenda with the exception of items 6 and 7, which were removed for further discussion.

Resolutions:

Authorize City Manager to Execute the Primary Grant Agreement with the San Mateo County Transportation Authority
Director of Public Works Richard Chiu provided the staff report. Chiu addressed questions on the condition of Mission Street and who has jurisdiction over Mission Street.

Councilmember Manalo reported being in talks with Senator Scott Wiener regarding Mission Street’s current condition, the State’s jurisdiction over Mission Street, and has been following up with the Senator to have his support on advocating for this issue.

City Manager Piccolotti reported on staff drafting language for community outreach letters regarding concerns over Mission Street, and have been in talks with Caltrans about a potential agreement regarding repairs to Mission Street.

It was moved by Councilmember Manalo, seconded by Councilmember Proaño and carried to adopt the resolution.

Resolution 25-19, Authorizing Execution Of A Primary Grant Agreement With The San Mateo County Transportation Authority For Future Measures A And W Funding Consider Partnership with the Athletes for A Better Community (ABC) at the War Memorial Community Center and the Pacelli Gymnasium
Director of Recreation Services Denise Brown provided the staff report to consider partnership with ABC to provide a Mayor’s Cup Basketball Tournament for youth through seniors and workshops/clinics for the youth, and to consider fee waivers.

Tim Schulze commended nonprofit organization ABC for helping the youth by teaching them discipline and giving them self-improvement skills through its sports programming. Tim commended ABC

CITY OF DALY CITY
MINUTES – REGULAR MEETING – CITY COUNCIL
FEBRUARY 10, 2025
3 for providing benefits to the community, particularly for the youth and seniors. Tim acknowledged local businesses and organizations for their sponsorship, highlighting Ling Nam Restaurant as a major sponsor.

ABC’s founder addressed questions on the history of the organization, whether the workshops will be free, residence requirements for the team’s players, and the size of the basketball courts.

It was moved by Councilmember Manalo, seconded by Councilmember Proaño and carried to adopt the resolution.

Resolution 25-20, Approving A Partnership With The Athletes For A Better Community (ABC) At The War Memorial Community Center And Pacelli Event Center Accept and Appropriate Title IIIC1 One-Time-Only Funds from the County of San Mateo Aging and Adult Services
Resolution 25-21, Accepting And Appropriating Of Title IIIC1 One-Time-Only Funds From The San Mateo County Aging And Adult Services Of San Mateo County Authorize the City Manager to Execute an Addendum Agreement with the Jefferson Elementary School District
Resolution 25-22, Authorizing Execution Of Addendum To Agreement With Jefferson Elementary School District For The After School Education And Safety Program At MP Brown Elementary School And The Expanded Learning Opportunities Program At Daniel Webster And Majorie H. Tobias Elementary Schools And Fernando Rivera Intermediate School
Notice of Completion for the Parks/Fleet Maintenance Facility Roof Project Resolution 25-23, Accepting Completion Of Certain Project In The Department Of Public Works Accept Mandated Fire And Safety Inspection Report
Resolution 25-24, 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 Check Registers:

Check Registers for the Month of December 2024

END OF CONSENT OF AGENDA
COMMUNICATIONS:

Finding of Public Convenience and Necessity PCN-8-24-16615 to Sell Alcoholic Beverages for OffSite Consumption at DC Market at 6825 Mission Street (Type 21 License) Assistant Planner Brian Paland provided the staff report to consider whether the issuance of a Type 21 liquor license to DC Market would serve the public convenience or necessity. Paland reported the census

CITY OF DALY CITY
MINUTES – REGULAR MEETING – CITY COUNCIL
FEBRUARY 10, 2025
4 tract in which the store is located is considered by the Department of Alcohol Beverage Control as overconcentrated by three Type 21 licenses.

Abdul Nasher, owner of DC Market, spoke about how their business has struggled and experienced a decline in revenue since the passing of Prop 31 which banned the sale of flavored tobacco products.

Therefore, Abdul is seeking approval to sell alcohol products in order to raise revenue and support his family. Abdul addressed questions on the proximity of the store to Jefferson High School.

Paland addressed questions on the accessibility of alcoholic products, the definition of overconcentration of alcohol licenses in the census tract, and the stores currently carrying alcoholic licenses in the census. Acting Chief Christensen addressed questions on current alcohol-related cases in the area.

It was moved by Mayor Daus-Magbual, seconded by Vice Mayor Sylvester and carried by roll call vote to deny the request and adopt the following resolution:

Resolution 25-25, Adopting Findings In Response To An Application For A Type 21 Liquor License –DC Smart Market – 6825 Mission Street
APPOINTMENTS:

It was moved by Mayor Daus-Magbual, seconded by Councilmember Manalo and carried to appoint Dr. Valerie Francisco-Menchavez to the Women’s Commission.

REPORTS:

Council Committee
Finance Ad Hoc Committee Meeting (Daus-Magbual/Sylvester) Ethics Committee (Daus-Magbual/Sylvester)
City Council
Councilmember Proaño reported attendance at the following events: the Lunar New Year celebration, acknowledging the lion dance performers; the state of the Cow Palace event, acknowledging Mayor Daus-Magbual, Councilmember Manalo, Director Mothershead, Economic Development Specialist Manio, and Jimmy Ford (Fire In The Ring) for their participation; the Holy Angels second annual gala event at the Brotherhood Masonic Center, along with Councilmembers Manalo and DiGiovanni and acknowledged the youth who performed; and the service at Duggan’s where Proaño was asked to sing to honor the memory of Veteran U.S. Army Air Forces Staff Sgt. Yuen Hop who fought in WWII and was POW/MIA.

Councilmember Manalo reported attendance at the following events: the second annual Lunar New Year event in Daly City, wishing everyone a Happy Lunar New Year; the Lunar New Year event in San Francisco’s Chinatown; the retirement celebration for Nicole Sandkulla from BAWSCA, along with Director Cosgrove; the state of the Cow Palace event; the Lunar New Year event at San Francisco’s City Hall, acknowledging Mayor Lurie; the New Year celebration with medical doctors, along with Mayor DausMagbual and Councilmember Proaño; the Daly City Crab Feed to sponsor scholarships, along with Mayor Daus-Magbual and his wife, and recognizing Recreation’s Opal Fuller; the Holy Angels second annual gala along with daughter Juselle; and the event at Duggan’s to honor U.S. Army Air Forces Staff Sgt. Yuen Hop who was killed in WWII and whose remains were identified and brought home.

CITY OF DALY CITY
MINUTES – REGULAR MEETING – CITY COUNCIL
FEBRUARY 10, 2025
5 Councilmember DiGiovanni reported attendance at the following events: the Crab Feed, acknowledging the DCPLA, the Human Resources and Water and Wastewater departments, Recreation’s Opal Fuller, Director Brown, and Mayor Daus-Magbual; the Holy Angels event, acknowledging Councilmember Proaño, the sisters of Holy Angels, and the parents for supporting a good cause; Daly City’s Lunar New Year event featuring DJ Keith O, the artists, vendors, performers, and acknowledging Mayor Daus-Magbual for emceeing the event.

Vice Mayor Sylvester acknowledged Daly City’s annual Lunar New Year event. Sylvester reported attendance at the Crab Feed, along with local residents Dr. Owen and Janice Daniels, the Daly City Councilmembers, and acknowledged the work by staff and Recreation’s Opal Fuller.

Mayor Daus-Magbual recognized staff for all the wonderful City events and recommended checking the City’s social media for more upcoming events. Dr. Daus-Magbual reported attendance at the following – Daly City’s Lunar New Year event; the Daly City Crab Feed; the retirement celebration of Bernadette Sy of SOMA Pilipinas Filipino Cultural District who served the needs of the SOMA neighborhood, particularly Filipino immigrants; the Kapwa Kultural Center (Daly City) event, where the Mayor gave commendations to Berna Anat for publishing Money Out Loud and Bianca Mabute-Louie for publishing Unassimilable. Dr. Daus-Magbual addressed the growing hysteria with regard to immigration and customs enforcement in the community, and reminded the public that California is a sanctuary state and of Daly City’s status as a sanctuary-friendly city. The Mayor stated that Daly City has its own local protective policies in place and wanted to assure the public that Daly City supports its immigrant community members.

ADJOURNMENT:

Mayor Daus-Magbual adjourned the meeting at 9:19 PM in honor of those celebrating their birthdays including Councilmember Proaño’s grandson Gabriel, Councilmember Manalo’s sister CarleyAnn, Mayor Daus-Magbual’s daughter, Vice Mayor Sylvester, and Vice Mayor Sylvester’s daughter.

Approved as submitted, this 24th
City Clerk
day of February , 2025.

Roderick Daus-Magbual
Mayor

City Council Meeting Agenda Report Item #
Meeting Date: February 24, 2025
Subject: Accept Fiscal Year 2024 Annual Comprehensive Financial Report Recommended Action
Acceptance by motion of the fiscal year 2024 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’sassets.

Discussion
The Independent Auditor’s Report contained in the Annual Comprehensive Financial Report (ACFR) indicates that the financial statements present fairly, in all material respects, the financial position of the City as of June 30, 2024. This opinion is considered “clean” or “unmodified”, which means that the financial records reflect appropriately the financial activity of fiscal year 2024.

The ACFR 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 activities are included.

Each year the ACFR 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 2023 and staff anticipates that the City will be successful in attaining the award for fiscal year 2024.

Summary/Conclusion
Staff recommends acceptance of the fiscal year 2024 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
Attachments: Fiscal Year 2024 Annual Comprehensive Financial Report

ANNUAL COMPREHENSIVE

FINANCIAL REPORT

C I T Y O F D A L Y C I T Y ,

C A L I F O R N I A
FOR THE FISCAL YEAR ENDED JUNE 30, 2024

CITY OF DALY CITY, CALIFORNIA

ANNUAL COMPREHENSIVE FINANCIAL REPORT

FOR THE FISCAL YEAR ENDED
JUNE 30, 2024
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 Certificate of Achievement for Excellence in Financial Reporting ........................................................ xviii

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 ........................................................................................................ 20 Statement of Activities ............................................................................................................. 21 Fund Financial Statements:

Governmental Funds:

Balance Sheet ........................................................................................................................ 24 Reconciliation of the Governmental Funds Balance Sheet with the Statement of Net Position ................................................................................................ 25 Statement of Revenues, Expenditures, and Changes in Fund Balances .............................. 26 Reconciliation of the Net Change in Fund Balances - Total Governmental Funds with the Statement of Activities ........................................................................... 27 i

CITY OF DALY CITY

ANNUAL COMPREHENSIVE FINANCIAL REPORT

TABLE OF CONTENTS
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Statement of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual:

General Fund ............................................................................................................................ 28 Gas Tax Special Revenue Fund ......................................................................................... 30 Grants Special Revenue Fund ............................................................................................ 31 Measures A and W Special Revenue Fund ....................................................................... 32 Proprietary Funds:

Statement of Net Position ................................................................................................. 33 Statement of Revenues, Expenses and Changes in Fund Net Position ............................ 34 Statement of Cash Flows .................................................................................................. 35 Fiduciary Funds:

Statement of Fiduciary Net Position ..................................................................................38 Statement of Changes in Fiduciary Net Position ...............................................................39 Notes to Basic Financial Statements .......................................................................................... 41 Required Supplementary Information:

Schedule of Changes in the Net Pension Liability and Related Ratios – Pension Plans ........... 88 Schedule of Contributions - Pension Plans ................................................................................ 90 Schedule of Changes in the Net OPEB Liability and Related Ratios ........................................ 91 Schedule of Contributions – Other Post-Employment Benefits Plan. ....................................... 92 ii

CITY OF DALY CITY

ANNUAL COMPREHENSIVE FINANCIAL REPORT

TABLE OF CONTENTS
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Supplemental Information:

General Fund:

Combining Fund Balance Sheet .......................................................................................... 94 Combining Fund Schedule of Revenues, Expenditures and Changes in Fund Balance ..... 95 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 ....................................................................................................... 98 Nonmajor Governmental Funds:

Combining Balance Sheet ................................................................................................. 100 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances ........................................................................................................... 101 Combining Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual ......................................................................... 102 Internal Service Funds:

Combining Statement of Net Position ............................................................................... 106 Combining Statement of Revenues, Expenses and Changes in Fund Net Position .......... 108 Combining Statement of Cash Flows ................................................................................ 110 Custodial Funds:

Combining Statement of Net Position .............................................................................. 114 Combining Statement of Changes in Net Position ........................................................... 115 iii

CITY OF DALY CITY

ANNUAL COMPREHENSIVE FINANCIAL REPORT

TABLE OF CONTENTS
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III STATISTICAL SECTION
Net Position by Component - Last Ten Fiscal Years .......................................................................... 119 Changes in Net Position - Last Ten Fiscal Years ................................................................................ 120 Fund Balances of Governmental Funds - Last Ten Fiscal Years ........................................................ 124 Changes in Fund Balance of Governmental Funds – Last Ten Fiscal Years ..................................... 126 Assessed Value of Taxable Real Property - Last Ten Fiscal Years .................................................... 128 Direct and Overlapping Property Tax Rates - Last Ten Fiscal Years ................................................. 129 Principal Property Tax Payers – Ten Year History ............................................................................. 130 Property Tax Levies and Collections – Last Ten Fiscal Years ........................................................... 131 Ratio of Outstanding Debt by Type – Last Ten Fiscal Years ............................................................. 132 Ratio of General Bonded Debt by Type – Last Ten Fiscal Years ....................................................... 133 Computation of Direct and Overlapping Debt .................................................................................... 134 Computation of Legal Bonded Debt Margin ....................................................................................... 135 Water Utility Fund - Number of Connections by Users as of June 30, 2024 .................................... 136 Water Utility Fund - Certificates of Participation Historical Revenues, Expenditures and Bond Coverage – Last Ten Fiscal Years .................................................................................................... 137 Demographic and Economic Statistics - Last Ten Fiscal Years ......................................................... 138 Principal Employers – Ten Year History ............................................................................................ 139 Full-Time City Government Employees by Function – Last Ten Fiscal Years ................................. 140 Operating Indicators by Function/Program – Last Ten Fiscal Years .................................................. 142 Capital Asset Statistics by Function/Program – Last Ten Fiscal Years .............................................. 144 iv

City of Daly City
333 – 90TH STREET
DALY CITY, CALIFORNIA 94015-1895
v
December 13, 2024
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, 2024. 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 with Maze and Associates, independent 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 conjunction 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, based on a comprehensive framework of internal controls that are established for this purpose. Since 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 101,458. Daly City is an urbanized, coastal community located at the northern edge of San Mateo County, comprising approximately 7.66 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 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. There are five council members who serve overlapping terms of four years, and the City Council, in turn, 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 officer. It is the City Manager's responsibility to hire department heads for each of the City functions, to propose the annual 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 complete 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 operates a water utility and a sanitary sewer district. Operating and capital costs for these services are maintained in enterprise funds and are funded by user rates or debt proceeds.

The ACFR includes all 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 Sanitation District, the Daly City Public Facilities Financing Corporation, the Daly City Housing Development Finance Agency, and the Daly City Joint Powers Financing Authority. 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, Agency, and Authority. 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 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. The City Manager’s Proposed Budget is presented to the City Council during public budget meetings. 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 budget cycle. Departments are responsible for managing within the

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City Council appropriated budget. Budget amendments are often necessary due to changes in economic conditions and other circumstances occurring during the fiscal year.

FACTORS AFFECTING FINANCIAL CONDITION
Economic Indicators
According to the Federal Open Market Committee, United States GDP in 2024 is expected to grow 2% while the GDP increased in 2023 by 3.1%, compared to 0.7% in 2022 and negative 5.4% in 2021. Although the increased growth rate is an improvement over the negative growth rates resulting from the COVID-19 pandemic, the lower growth rates still reflect a possible future recession. Also due to the pandemic, California unemployment hit a record high of 16.4% in May 2020 and then reached a new low of 3.4% in May of 2022 as the State recovered. However, the return to low unemployment may not last as the Federal Reserve increases interest rates in response to rising inflation. As of October 2024, the unemployment rate has risen to 5.4%. The greatest risks to the forecast of the U.S. economy stem from concerns over inflation, rising interest rates, and supply concerns for both labor and housing. The current tightening of monetary policies affecting financial and credit conditions will also weigh on economic activity, hiring, and inflation.

In California, especially in the San Francisco Bay Area, housing prices continue to be increasingly expensive and unaffordable, particularly for first time homebuyers, given the limited availability. The U.S. Home Price Growth, on a year-over–year basis as measured by the Case-Shiller 20-City Composite Home Price Index, experienced a 5.9% increase in July 2024, compared with a 0.1% increase in July 2023. 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 demand is one of the major causes of high housing costs in the coastal California region.

Local Economy and Fiscal Challenges
General Fund revenues for FY 2024 increased by $5.9 million to $124.7 million. The revenue increase is made up of some revenue increases and some decreases among the various General Fund sources. The City experienced revenue increases in property tax and sales tax revenues of about $3.9 million dollars; an increase in the utility users tax, due to rising energy costs in FY 2024; and, through the recognition of $5.6 million in one-time American Rescue Plan Act (ARPA) funds. General Fund expenditures increased by $6.7 million to $117.5 million in FY 2024, the majority of which was due to salary and benefit increases resulting from cost-of-living raises. Although the City budgeted at a deficit for FY 2024, the General Fund almost broke even, with only a minor deficit because of savings from a large number of vacant staff positions.

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Enterprise Funds
Two of the City’s major enterprise funds, the Water Utility Fund and Sanitation District Fund, derive revenue from water usage.

Revenues for the Water Utility Fund increased by $1.4 million to $29.8 million in FY 2024 mainly due to an annual water rate increase of 9.5% and investment returns.

Expenses increased $1.7 million to $20.9 million in FY 2024 reflecting an increase in the cost-of-living salary increases for employees in the Water Utility Fund and an increase in capital project spending.

The Sanitation District Fund revenues increased by $2.6 million to $25.8 million in FY 2024 due to an annual 9% increase in sewer rates. Expenses increased by $3.2 million to $33.8 million in FY 2024 also reflecting an increase in cost-of-living salary increases for employees in the Sewer Enterprise Fund and an increase in capital project spending.

LONG RANGE FINANCIAL PLANNING
The City employs a ten-year financial forecasting model to ensure accountability of service levels and to plan for future challenges. Long-range financial planning enables the City to foresee potential budget 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 within the ten-year forecast are outside the City’s control. This includes changes in the national and local economy; federal and state legislation; and CalPERS actuarial assumptions, investment returns, and the resulting impact on employer 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 approval. For a ballot measure to be successful, there must be broad community support.

Given the current and forecasted budget challenges, the City has implemented a multipronged 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 Financial Policy is to maintain the Minimum General Fund unassigned fund balance equal to 17% or two months of annual budgeted expenditures. It is recommended that the City maintain the Preferred General Fund unassigned fund balance equal to 25% or 3 months of annual budgeted expenditures. Accomplishing the reserve target of 25% requires closely monitoring the balance between revenues and expenses on an ongoing basis. The General Fund reserve provides a buffer to the City in the event of unexpected reductions in revenues or increases in costs. If the City draws down the General Fund reserve, year-end budget surpluses will be used to replenish the reserve.

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2. Identify other potential sources of revenues. Over the next ten years, General Fund expenses will continue to increase beyond the City’s ability to fund with current revenue sources. The City was successful with ballot measures on a cannabis business license tax and increases for transient occupancy tax and business 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 added a transaction and use tax of one-half cent to the total sales tax rate as of April 2021. The City will continue to identify other potential sources of new revenue and evaluate City fees to ensure cost recovery for services provided.

3. Promote economic development and business expansion. The City has identified several economic development opportunities which will improve economic activity in the City. These include economic development opportunities related to the disposition of former Redevelopment sites, implementation of commercial cannabis business licensing, and the provision of financial assistance to local small and minority-owned businesses.

The City has expanded efforts to engage with the small business community by creating the Small Business Commission to celebrate and honor local businesses through the Legacy Business Award program. A contract with the Daly City Colma Chamber of Commerce was also re-established this past year. The City will continue to identify new opportunities for expanding and diversifying its economic base to ensure long-term fiscal sustainability.

4. Pre-fund Pension and Other Post-Employment Benefits (OPEB). 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 continued to contribute to this Program in FY 2024.

In May 2017, the City Council also authorized participation in a Section 115 Trust to prefund 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. Another potential benefit includes 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 and capital improvement plan. Within the last seven years, the Public Works Department completed several longterm planning documents. The City completed the Facilities Condition Assessment, the ADA Self Evaluation and Transition Plan, the Parks and Open Space Master Plan, the Vision Zero Action Plan, the update to the City’s Pavement Management System Report, and the Pedestrian and Bicycle Master Plan. The Storm Drain Master Plan is currently underway and anticipated to be completed in 2025. The Seismic Evaluation of Critical Facilities still needs to be budgeted for.

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The needs identified by the above master planning documents far exceed the available resources currently available. Public Works has and will continue to look for grant funds to assist with needed improvements. Public Works will also work with other departments to develop and identify long term budget plans to improve and maintain the City’s infrastructure.

MAJOR INITIATIVES
During FY 2024, 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 Department has continued to provide its regular services while implementing a variety of new programs and policies. Aside from the typical permit issuance and building inspections, the Building Division improved customer service by making improvements to its online permitting portal for “quick” permits and permits for photovoltaic installations. With the assistance of Plante Moran, an analysis of the permitting process was initiated with the goal of creating greater efficiency and to better utilize technology to improve the process.

The Planning Division continued its work on the preparation of the Housing Element, which is a plan to build over 4,800 housing units to meet the region’s housing needs. The Planning Division created Objective Design Standards to help streamline residential development throughout the City.

Economic Development staff had its inaugural Legacy Business Celebration to celebrate local businesses that have local relevance to the community. Additionally, the Economic Development staff and the Small Business Commission conducted small business listening tours and surveys to hear issues most important to the business community. The results will help guide policy. Economic Development staff took the lead in creating a street fair called Top of the Hill Festival to showcase the businesses in the Top of the Hill neighborhood and to establish this neighborhood as a destination.

The Housing Division continued to administer the federal funding that was provided to help households that were affected by COVID-19 through rental assistance, food distribution, and mental health services. The Housing Division has also confirmed funding and secured a site to establish a low-income daycare facility on City property. The Housing Division also continues to refine its contract with Habitat for Humanity to administer the Residential Rehabilitation Program.

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Daly City Library
The Department of Library and Recreation Services was evaluated and found that the two departments would be better able to serve the public as individual units. These two departments were split into The Daly City Public Library and The Department of Recreation Services.

In fiscal year 2024, Daly City’s libraries welcomed 229,980 visits, an increase of nearly 25% from the previous year. Use of the physical collection is also trending up with a circulation total of 472,414, an increase of close to 5% from last year. There were larger gains in use of electronic materials; eBooks and online resources saw an increase of over 40%. Early literacy story times, activities, workshops, and events continue to draw people to the libraries. We provided 537 programs during the year with a total attendance of 16,093, a slight decrease from the prior year. Availability of public computers and wifi is still a critical offering for many residents. Use of the computers has trended downward, with 26,574 sessions, but wi-fi use has increased 14% to over half a million connections. Laptop lending kiosks now installed at three of our four locations offers a hybrid option for visitors needing internet access for work, school, research, or recreational purposes.

North County Fire Authority
The North County Fire Authority (NCFA) achieved an overall “Customer Satisfaction” rating of 98% in the delivery of emergency and non-emergency services. NCFA provided high quality Basic Life Support and Advanced Life Support assessment and treatment interventions to emergency medical incidents utilizing our paramedic fire engines and truck companies, in which over half of total EMS calls benefited and served senior citizens. NCFA achieved an average response time of 5 minutes and 26 seconds for on scene arrival of a first due fire company at all emergency incidents.

Fire Prevention Services completed pre-fire engineering and plan check reviews and inspections for new construction projects, tenant improvements, alarm installations and suppression systems, additionally completed a fire “cause and origin” analysis and investigation for all fire incidents. Further, NCFA completed annual mandated and required fire and life safety code compliance inspections covering all business, multifamily and permitted occupancies. NCFA presented throughout the year Emergency Preparedness, Individual and Family Preparedness seminars, as well as Community Emergency Response Team (CERT) classes. Additionally, “Hands Only CPR”, “Stop the Bleed and Choking” was presented to the public through numerous events and venues.

NCFA provided fire engine companies and chief officers to multiple major wildfire incidents throughout the State of California.

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Police Department
The Daly City Police Department maintains our commitment towards service-based policing, often leading the industry in community engagement, policing tactics and technology, and policy adaptation. We continue to participate in local and regional task forces focused on quality-of-life issues and trending crime patterns. We remain committed to our local and regional law enforcement and supportive community partnerships, and well as other entities designed to provide invaluable services to our community.

As part of our ongoing commitment to combat organized retail theft (ORT), we applied and were awarded a California State grant to implement a comprehensive response, to include acquisition of advanced technology and extra deployment of personnel. This grant opportunity established a joint task force with two partner agencies sharing similar concerns, allowing us to combine resources. We strengthened our relationship with local retailers by working closely with businesses, sharing information to support a swift and collaborative response to incidents. Ultimately, this has created a safer retail environment for both merchants and shoppers. Our grant also supported a focus on vehicle accessory theft, which has resulted in a decrease in related crimes. This multi-faceted approach not only disrupts organized crime but also reinforces our commitment to protecting both local businesses and the community, ensuring a safer environment for all.

We continue to support community trust through transparency by equipping officers with body and vehicle cameras, and by ensuring applicable policy adaptation. We strive to remain compliant with all reporting and legislative requirements, and we have further prioritized community engagement by maintaining staffing in our Community Division, enhancing our social media presence, and expanding our participation in local events.

We continue to strengthen community engagement by maintaining our own Mental Health Clinician in the field, and through employing Police Assistants and Community Service Officers, designed to bridge the gap between a civilianized law enforcement response and our community. These relationships will ensure a well-versed response to community needs and layers of a compassionate approach.

Technology has become a primary focus of our response tactics. We are seeing significant success in responding to, investigating, and preventing crime using automated license plate readers (ALPR’s), pursuit intervention solutions, and data integration software designed to streamline investigations. Increased officer and community safety is being realized through the deployment of unmanned arial systems, with future expansion into drones as a first responder (DFR) for improved efficiency and safety.

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Public Works Department
The Public Works Department completed several capital improvement projects and continued to provide routine services to the public such as street sweeping, traffic signal and street light maintenance, equipment and vehicle maintenance, facility maintenance, park maintenance and litter and debris removal. The Department continues to focus on preventative measures to maintain and maximize the useful lifespan of City owned assets such as City vehicles, equipment, facilities, and infrastructure.

Some completed projects by the Public Works Department include: the Central Corridor Bicycle and Pedestrian Safety Improvements Project, Community Development Block Grant ADA/Sidewalk Improvements Project, Outdoor Fitness Courts at Westlake Park and Lincoln Park, 2020-2021 Serramonte Slurry Seal and Daly City Crosswalk Enhancement Project, 2020-21 Street Resurfacing Project, Fire Station 91 Roof Replacement Project, and 2021-22 and 2022-23 Street Resurfacing Project.

Construction also began on the Southgate Avenue and School Street Safety Improvements Project, Mussel Rock Landfill Upper Disposal Area Pull-Back Project, Civic Center North Human Resources Tenant Improvements Project, Lawson Hall Roof Project, and City Hall Elevator Modernization and ADA Barrier Removal Project.

The Public Works Department also continues to seek grant funds for the City and was successful in securing additional funds for the Lake Merced Boulevard Lane Reconfiguration and Bicycle Lane Protection Project, Daly City Vision Zero Design Standards Project, Daly City Safe Routes to School Project, Mussel Rock Landfill Upper Disposal Area Pull-Back Project, Electric Vehicle Purchase, and Daly City 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 drinking water, wastewater, and stormwater project, the Vista Grande Drainage Basin Improvement Project. DWWR is working diligently with our project partners, the San Francisco Public Utilities Commission (SFPUC), the County of San Mateo, Caltrans, the Olympic Club, and many others in anticipation of an early 2025 bid date, and construction beginning mid-year 2025.

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Drinking water projects continued to be of the highest priority and groundwater pumping projects were a large part of the Capital Program this year. Treatment modifications to the Westlake Pump Station to accommodate additional groundwater from new wells in Daly City was completed. The Design phases commenced for a new drinking water well at Margate Street and water main improvements at St. Francis, San Diego, Santa Cruz, and Guadalupe Streets. At Reservoir 6B a new seismic roof is being installed and the interior of Reservoir 8 is being restored to protect the drinking water of our residents.

Additionally, significant capital improvements were made at the North San Mateo County Sanitation District Wastewater Treatment Plant and Collection Facilities such as sewer lift station rehabilitation, improvements to the treatment plant air scrubbers, upgrades to the treatment plant aeration mixer, and roof replacement at the Administration and Operations buildings. Lastly, the City Council authorized the expansion of the Water Rate Assistance Program to become the Utility Rate Assistance Program and include solid waste and sewer rates. This expansion will offer financial help to low-income ratepayers in managing their utility bills.

Recreation Services
The Department of Recreation Services provided 600 rental opportunities for the Daly City community to host personal gatherings and events. The Youth Recreation Program, including Afterschool and Summer activities, served 2,940 participants across five school locations and four recreation facilities. Through the Senior Lunch Program, over 52,929 congregate meals were served across four locations, with an additional 2,470 frozen meals distributed to those in need through the Food Pantry.

Athletic leagues and programs, such as Youth Basketball, Mini Hoops, Youth Baseball, and Clinics, engaged over 1,855 participants in safe, meaningful activities. The Department also hosted a variety of city-wide cultural and family-oriented events, including the Black History Celebration, Crab Feed, Recreation Resource Day, Spring Fun Day, Health and Wellness Fair, Children’s Day, Hip Hop Day, Latino Heritage Month, Kasayahan Sa Daly City, Trunk or Treat, Autumn Fest, and Frosty Fest, collectively reaching over 10,000 youth and families.

Additionally, recreation programs, activities, and classes in exercise, education, and cultural arts served more than 15,349 participants. Community engagement was bolstered by 470 volunteers and volunteens, who collectively contributed over 28,656 service hours to support these efforts.

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AWARDS
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Daly City for its Annual Comprehensive Financial Report (ACFR) for the fiscal year ended June 30, 2023. This was the 37th consecutive year that the City of Daly City has received this prestigious award.

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.

In addition, the City also received the GFOA’s Award for Distinguished Budget Presentation for its Comprehensive Operating and Capital Budget for FY 2024. To qualify for the Distinguished Budget Presentation Award, the City’s budget document was judged to be proficient in several categories including policy documentation, financial planning and organization.

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, City Council members and 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,
Thomas J. Piccolotti Timothy J. Nevin
City Manager Director of Finance and
Administrative Services

CITIZENS OF

DALY CITY

CITY OF DALY CITY

ORGANIZATONAL STRUCTURE
FISCAL YEAR 2024

MAYOR &

COUNCIL CITY CLERK CITY TREASURER

CITY ATTORNEY

PLANNING

COMMISSION

BICYCLE & PEDESTRIAN

ADVISORY COMMITTEE
YOUTH

ADVISORY

COMMITTEE

RECREATION

COMMISSION

LIBRARY BOARD OF

TRUSTEES
SMALL

BUSINESS

COMMISSION

PERSONNEL
BOARD
ARTS &

CULTURE

COMMISSION

MOBILE HOME

RENT REVIEW

COMMISSION

CITY MANAGER

ECONOMIC &

COMMUNITY

DEVELOPMENT

FINANCE &

ADMINISTRATIVE

SERVICES

FIRE HUMAN

RESOURCES

LIBRARY

SERVICES POLICE PUBLIC WORKS

WASTE &

WASTEWATER

RESOURCES

RECREATION

SERVICES
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CITY OF DALY CITY

CITY COUNCIL
JUNE 30, 2024
Juslyn C. Manalo, Mayor
Dr. Rod Daus-Magbual, Vice Mayor
Glenn R. Sylvester
Pamela DiGiovanni
Teresa G. Proano
K. Annette Hipona
City Clerk
Daneca Halvorson
City Treasurer

ADMINISTRATION AND DEPARTMENT HEADS
Thomas J. Piccolotti
Rose Zimmerman
Richard Chiu Jr.

Cameron Christensen
Timothy Nevin
Tatum Mothershead
Ron Myers
Joshua A. Cosgrove
Natalie Sakkal
City Manager
City Attorney
Director of Public Works
Deputy 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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Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Daly City
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2023
Executive Director/CEO
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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 Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Daly City, California, as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the Table of Contents.

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City as of June 30, 2024, and the respective changes in financial position and, where applicable, cash flows thereof and the respective budgetary comparisons listed in the Table of Contents as part of the basic financial statements for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirement relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.

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In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.

Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit.
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed.
• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.

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

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Required Supplementary Information
Accounting principles generally accepted in the United 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 information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The accompanying Supplementary Information, as listed in the Table of Contents, is presented for purposes of additional analysis and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the Supplementary Information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Information
Management is responsible for the other information included in the annual report. The other information comprises the Introductory Section and Statistical Section listed in the Table of Contents, but does not include the basic financial statements and our auditor’s report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.

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

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Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 13, 2024 on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.

Pleasant Hill, California
December 13, 2024
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MANAGEMENT’S DISCUSSION AND ANALYSIS
This narrative overview and analysis of the City of Daly City’s financial results provides an overview of the City’s financial activities for the year ended June 30, 2024.

FISCAL YEAR 2024 FINANCIAL HIGHLIGHTS
• As of June 30, 2024, net position totaled $218.1 million, an increase of $17.8 million from the prior year total of $200.3 million for both Governmental and Business-Type activities. • Net Position of governmental activities in Fiscal Year (FY) 2024 was $88.4 million compared to $78.2 million in FY 2023, an increase of $10.2 million. • Net Pension and OPEB Liabilities of governmental activities increased by $8.1 million to $242.5 million in FY 2024 from $234.4 million in FY 2023. • Net Position of business-type activities in FY 2024 was $129.7 million compared to $122.1 million in FY 2023, an increase of $7.6 million.
• Net Pension and OPEB Liabilities of business-type activities increased by $.2 million to $18.2 million in FY 2024 from $18 million in FY 2023.
• In FY 2024, total City revenues, including program and general revenues, were $216 million, while total expenses were $198 million.
• Governmental activities program revenues were $40.1 million in FY 2024 compared with $37.9 million in FY 2023. Business-type activities program revenues were $57.2 million in FY 2024 compared with $56.4 million in FY 2023.
• Governmental activities general revenues were $110.1 million in FY 2024 compared with $100.9 million in FY 2023, an increase of $9.2 million over the prior year. Part of this is $3.9 million in additional revenues from property taxes and sales taxes, showing a return to more normal growth rates for these revenues. In addition, there was an increase in the utility users tax due to increasing energy costs in FY 2024, and an improvement in investment income of $5.9 million. Business-type activities general revenues were $8.5 million in FY 2024, an increase of $4 million over the prior year primarily due to an improvement in investment income.
• Unrestricted net position of governmental funds changed from negative ($64) million in FY 2023 to negative ($58.6) million in FY 2024, primarily due to an increase in total assets of $19.5 million, made up of increases in cash and investments and capital assets.

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OVERVIEW OF THE ANNUAL COMPREHENSIVE FINANCIAL REPORT
This Annual Comprehensive Financial Report (ACFR) is in three sections:
1) Introductory Section containing the Transmittal Letter and miscellaneous other information
2) Financial Section containing the Independent Auditor’s Report, this Management’s Discussion and Analysis, the Basic Financial Statements, which include the Governmentwide 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. The Statement of Activities provides information about all the City’s revenues and all its expenses, also on the full accrual 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 activities 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 activities and business-type activities 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 governmentwide 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 financial activities of the City and are presented individually, while the activities of non-major funds are presented 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.
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The Government-Wide Financial Statements
The Statement of Net Position and the Statement of Activities present information about the following:
• Governmental activities - All the City’s basic services are governmental activities, including general government, public safety, public works, streets and infrastructure, culture and recreation, and economic and community 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 governmental services, these services are supported by charges paid by users based on the amount of the service they use.

Government-wide financial statements are prepared 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 provide detailed information about each of the City’s most significant funds, called major funds. Each major fund is presented individually, with all nonmajor funds summarized and presented only in a single column. Subordinate schedules present the detail of these non-major funds. Major funds present 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 activities, their activities are reported only in total at the fund level. Internal service funds cannot be major funds because their 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 presented 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 Statement of Fiduciary Net Position. These activities are excluded from the City’s other financial statements because the City 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)
Governmental Activities
The City’s net position from governmental activities increased from $78.2 million in FY 2023 to $88.4 million in FY 2024. The increase in the Net Position reflected in the Statement of Activities, is also shown in Table 1. Increases and decreases of individual assets and liabilities include:
• Governmental cash and investments increased $12.8 million from $183.1 million in FY 2023 to $195.9 million in FY 2024. The City’s net position in cash and investments increased partly because of a steady increase in governmental revenues including property taxes ($3.2 million), sales taxes ($681 thousand), and charges for fees ($1.2 million) which increased due increased use of City services. The other portion of that increase is due to the change in investment earnings, which went from $3.5 million in FY 2023 to $9.5 million in FY 2024, as the financial markets rebounded to positive returns. 8

• Also on the asset side, capital assets increased in FY 2024 to $107.5 million from $102.2 million in FY 2023. This is mostly due to the implementation of GASB 96 in FY 2023.

Within the City’s governmental activities, the City estimates the value of the subscriptionbased information technology arrangement assets to be $ 4.5 million. • In FY 2024, liabilities also increased by $5.6 million. This is due to an increase in the City’s net pension and OPEB liabilities, which went from $234.4 million in FY 2023, to $242.5 million in FY 2023.
• The restricted net position increased $1 million, and the unrestricted net position improved by $5.4 million from negative ($64) million in FY 2023 to negative ($58.6) million in FY 2024. The City’s unrestricted net position was negatively impacted in fiscal year 2014-15 with the implementation of GASB 68, which continues to require the disclosure of the City’s unfunded pension liability. The unrestricted net position improved in FY 2024 because of the increase in cash and investments ($12.7 million) and the increase in capital assets ($5.3 million).

Business-type Activities
The net position of business-type activities increased $7.6 million to a total of $129.7 million in FY 2024 from $122.1 million in FY 2023. Increases and decreases of individual assets and liabilities are as follows:
• Cash and investments increased $12.7 million in FY 2024 due to a few different factors.

The Water Utility revenues did increase $1.4 million in FY 2024 because of a 9.5% water rate increase. In addition, the Sanitation District revenues increased about $.6 million in FY 2024 due to a 9% increase is sanitary sewer rates even as water usage decreased. Investment income also went up for both utilities adding $2.6 million to the total given the strong financial market returns in FY 2024. Finally, the Sanitation District continued to receive grant revenues in FY 2024 that added to the cash balance including revenues from the Water and Wastewater Arrearage Payment Program funded by the American Rescue Plan Act. • Liabilities decreased in FY 2024 by $.4 million from $24.6 million in FY 2023 to $24.2 million in FY 2024. Similar to governmental activities, the increase is due to a $.2 million increase in net pension and OPEB liabilities.
• Overall, the unrestricted net position improved $7 million ending at $61.6 million in FY 2024. The unrestricted net position increased in FY 2024 because of the increases in cash and investments resulting mostly from the rate increases approved for the year by both the Water Utility and the Sanitation District.
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Changes in Net Position
Total governmental activities revenue in FY 2024 amounted to $150.2 million compared to $138.8 million in FY 2023, an increase of $11.4 million in FY 2024 due to a variety of factors. This includes increases in both property taxes and sales taxes as the City’s main revenue sources returned to more normal growth rates. The increase also includes an increase in the utility users tax, based on the increase in energy costs in FY 2024, and $5.6 million in American Rescue Plan Act funding that the City recognized during the fiscal year. Governmental expenses increased by $16.9 million in FY 2024 mostly due to newly negotiated cost of living raises for employees.

Total business-type activities revenues increased $4.8 million in FY 2024 due to an increase in water utility rate revenues, sanitary sewer rate revenues, an increase in investment income, and operating grants and contributions. The expenses increased $6.2 million due to an increase in the net pension and OPEB liability for FY 2024 and negotiated cost of living raises for employees.

Table 2
Changes in Net Position
For Years Ended June 30
(in thousands)
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Governmental Activities
Table 3 splits the revenues of the City’s governmental programs into five main areas. Table 4 splits the expenses of the governmental programs into six main areas. The distributions correspond to the programs in the Statement of Activities in which the total Change in Net Position, defined as total program cost less the revenues generated by those specific activities, is negative $(102) million.

Table 3
Governmental Activities - Revenues
For the Year Ended June 30, 2024
(in thousands)
Table 4
Governmental Activities - Expenses
For the Year Ended June 30, 2024
(in thousands)
General
Government,
$1,359
Public Safety,
$13,801
Public Works,
$16,062
Culture &
Recreation,
$3,745
Economic &
Community
Development,
$5,117
Governmental Activities - Revenues
General
Government,
$16,920
Public Safety,
$85,789
Public Works,
$13,603
Culture &
Recreation,
$18,268
Economic &
Community
Development,
$7,114
Interest on longterm debt, $356
Governmental Activities - Expenses
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THE CITY’S FUND FINANCIAL STATEMENTS
Governmental Funds
At June 30, 2024, the City’s major governmental funds consisted of the General Fund, Gas Tax Fund, Grants Fund, Measures A and W 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 increased $10.2 million to $88.4 million in FY 2024 compared to $78.2 million in FY 2023.

General Fund revenues for FY 2024 increased by $5.9 million to $124.7 million from $118.8 million in FY 2023 due to several factors. To begin, the City recognized $5.6 million in one-time American Rescue Plan Act funds during FY 2024 and saw an increase in its net investment income.

Additionally, property tax revenues increased by about 7%, with property taxes going from $48.9 million in FY 2023 to $52.1 million in FY 2024. Sales tax revenues increased slightly from $25.8 million in FY 2023 to $26.5 million in FY 2024. Meanwhile, charges for services increases almost 18% going from $6.5 million in FY 2023 to $7.7 million in FY 2024 due to return of fire inspections and recreation programs after the pandemic. At the same time, decreases in some General Fund revenues offset the bigger increases. General Fund expenditures increased by $6.7 million to $117.5 million in FY 2024 reflecting additional increases in salaries and benefits in accordance with adopted memoranda of understanding. Although the General Fund showed an increase in expenditures, the expenditures were $4.8 million lower than the budget of $122.3 million. This is primarily due to salary savings within the Police Department and other General Fund departments where the City has seen a high number of vacant positions.

In FY 2024, the Gas Tax Special Revenue Fund total fund balance decreased slightly to $8.6 million as revenues closely matched expenses. 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 expenditures as laid out in the multi-year capital improvement plan. However, the fund balance in the Measures A and W Fund did increase from $11.4 million in FY 2023 to $12.7 million in FY 2024 as both funds brought in healthy revenues this fiscal year.

The Capital Projects Fund total fund balance increased $7.8 million in FY 2024 to $36.8 million compared to $29 million in FY 2023. This fund is designated for specific capital projects that will benefit the community. Capital Projects Fund revenues increased $0.5 million in FY 2024 to $4.9 million due to an increase in net investment income. A transfer of $8 million to the Capital Projects Fund was done from the general fund utilizing one-time general fund surpluses to help fund future capital projects. Capital Projects Fund expenditures also increased in FY 2024 to $6.5 million due to an increased in project spending.
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Enterprise Funds
The City has three major enterprise funds: the Water Utility Fund, the Sanitation District Fund and the Civic Center Fund.

Water Utility operating revenues in FY 2024 increased $1.4 million to $29.8 million compared to $28.4 million in FY 2023 due to an increase in revenues related to another 9.5% water rate increase.

Operating expenses increased $1.7 million in FY 2024 to $20.9 million because of increases in salaries and benefits in accordance with adopted memoranda of understanding.

Sanitation District operating revenues increased $0.6 million to $25.8 million in FY 2024 because sanitary sewer rates increased by 9% although the increase was offset by reduced water usage.

Operating expenses increased by $3.2 million to $33.8 million in FY 2024 because of increases in salaries and benefits in accordance with adopted memoranda of understanding.

The Civic Center Fund became a major fund in FY 2022 due to the implementation of GASB 87 and the addition of leases receivables for building leases within the Fund. The Civic Center Fund remained a major fund in FY 2024 with an ending net position of $5.5 million, a small increase from its $5.4 million net position in FY 2023.

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 continuing economic uncertainties, the City again completed a one-year budget process for FY 2024. Revenues were better than the budget in FY 2024 as some, like property tax and utility user fees tax, came in higher than expected.

Expenditures were below final budgeted amounts by $4.8 million, mostly because of staffing vacancies in the Police Department and other General Fund funded departments. 13

Table 5
General Fund
Statements of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual
For the Year Ended June 30, 2024
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CAPITAL ASSETS
At the end of FY 2024 the City had $175 million, net of accumulated depreciation, invested in a broad range of capital assets, as shown in Table 6 below (further detail may be found in Note 4 to the financial statements):

Table 6
Capital Assets Net of Depreciation at June 30
(in thousands)
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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 7
Outstanding Debt
(in thousands)
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ECONOMIC FACTORS
During fiscal year (FY) 2023-24, the City continued to see growth in its main revenue sources, property taxes and sales taxes. Although some had predicted a recession might come in FY 2024 given the rising inflation and the increases in interest rates by the Federal Open Market Committee, the City did not experience any recessionary impacts. In fact, revenues seemed to return to more traditional growth rates as experienced by the City before the pandemic.

At the same time, though, expenditures continued to rise for the City as inflation and other supply and demand factors affected the cost of labor as well as services and supplies. The City had budgeted at a deficit for FY 2024, but ended the year almost breaking even since revenues were better than budgeted and expenses were significantly down due to staff vacancies. The City also continued to use its portion of the American Rescue Plan Act funds to help partially offset the budgeted deficit in FY 2024.

ADDITIONAL INFORMATION
This Annual Comprehensive Financial Report is intended to provide citizens, taxpayers, investors, and creditors with a general overview of the City’s finances. Questions about this Report should be directed to the Department of Finance and Administrative Services, 333 90th Street, Daly City California, 94015. Additional information about the City of Daly City, including our budget documents, can be found at www.dalycity.org.
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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 basis—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 decreases in the City’s Net Position. It is also prepared on the full accrual basis, which means 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. 19

CITY OF DALY CITY

STATEMENT OF NET POSITION
Governmental Business-Type
Activities Activities Total
ASSETS
Cash and investments (Note 2G) $195,864,131 $69,972,356 $265,836,487 Restricted cash (Note 2G) 4,767,252 4,767,252
Accounts receivable, net 14,749,097 7,296,477 22,045,574 Inventories (Note 2H) 268,112 2,062,439 2,330,551
Prepaids (Note 2H) 1,869,972 41,872 1,911,844
Internal balances (Note 6) (1,735,270) 1,735,270
Notes receivable (Note 13) 1,263,087 1,263,087
Loan receivable from Successor Agency (Note 15C) 9,621,859 9,621,859 Leases receivable (Note 7) 8,575,324 8,379,917 16,955,241 Property held for development (Note 2C) 3,366,888 3,366,888 Capital assets (Note 4):

Nondepreciable capital assets 42,506,139 19,253,238 61,759,377 Depreciable capital assets, net 64,970,069 48,269,307 113,239,376 Total Assets 346,086,660 157,010,876 503,097,536

DEFERRED OUTFLOWS OF RESOURCES
Related to pension (Note 8D) 59,370,869 4,322,350 63,693,219 Related to OPEB (Note 9E) 5,335,269 829,381 6,164,650
Total Deferred Outflows of Resources 64,706,138 5,151,731 69,857,869

LIABILITIES
Accounts payable 12,265,799 3,124,973 15,390,772
Accrued payroll 1,441,180 207,251 1,648,431
Deposits payable 6,904,791 28,600 6,933,391
Unearned revenue 8,478,029 8,478,029
Interest payable 40,636 40,636
Compensated absences (Note 2K):

Due within one year 6,121,560 953,028 7,074,588
Due in more than one year 12,369,648 1,628,139 13,997,787 Accrued claims payable (Note 11):

Due within one year 2,928,869 2,928,869
Due in more than one year 7,855,131 7,855,131
Net OPEB liability, due in more than one year (Note 9C) 28,247,302 4,391,112 32,638,414 Net pension liability, due in more than one year (Note 8C) 214,271,247 13,823,031 228,094,278 Lease payable (Note 7)
Due within one year 34,463 34,463
Subscription liabilities (Note 14):

Due within one year 1,077,797 1,077,797
Due in more than one year 3,525,953 3,525,953
Long-term debt (Note 5):

Due within one year 456,190 456,190
Due in more than one year 2,039,353 2,039,353
Total Liabilities 308,057,948 24,156,134 332,214,082

DEFERRED INFLOWS OF RESOURCES
Related to pension (Note 8D) 37,492 6,702 44,194
Related to OPEB (Note 9E) 6,121,946 951,671 7,073,617
Related to leases (Note 7) 8,223,628 7,323,703 15,547,331 Total Deferred Inflows of Resources 14,383,066 8,282,076 22,665,142 NET POSITION (Note 12)
Net investment in capital assets 100,342,452 67,522,545 167,864,997 Restricted for:

Streets and roads 21,247,628 21,247,628
Infrastructure 12,945,510 12,945,510
Qualified capital outlay 605,397 605,397
Affordable housing 9,708,513 9,708,513
Other 2,696,566 2,696,566
Total Restricted Net Position 46,598,217 605,397 47,203,614 Unrestricted (58,588,885) 61,596,455 3,007,570
Total Net Position $88,351,784 $129,724,397 $218,076,181 See accompanying notes to financial statements
JUNE 30, 2024
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CITY OF DALY CITY
FOR THE YEAR ENDED JUNE 30, 2024
Net (Expense) Revenue and
Changes in Net Position
Operating Capital
Charges for Grants and Grants and Governmental Business-type Functions/Programs Expenses Services Contributions Contributions Activities Activities Total Governmental Activities:

General government $16,919,779 $596,937 $599,920 $161,954 ($15,560,968) ($15,560,968) Public safety 85,788,744 5,940,432 7,860,882 (71,987,430) (71,987,430) Public works 13,602,903 3,547,885 6,398,248 6,115,526 2,458,756 2,458,756 Culture and recreation 18,268,662 2,806,681 938,391 (14,523,590) (14,523,590) Economic and community development 7,114,150 3,438,024 1,678,725 (1,997,401) (1,997,401) Interest on long-term debt 355,805 (355,805) (355,805)
Total Governmental Activities 142,050,043 16,329,959 17,476,166 6,277,480 (101,966,438) (101,966,438) Business-type Activities:

Water Utility 20,994,878 29,346,716 456,481 $8,808,319 8,808,319 Civic Center 1,045,147 1,293,382 248,235 248,235
Transfer Station
Sanitation District 34,036,049 25,667,679 461,116 (7,907,254) (7,907,254) Total Business-type Activities 56,076,074 56,307,777 917,597 1,149,300 1,149,300 Total $198,126,117 $72,637,736 $18,393,763 $6,277,480 (101,966,438) 1,149,300 (100,817,138) General revenues:

Taxes:

Property tax 52,139,564 2,725,057 54,864,621
Sales tax 26,455,971 26,455,971
Utility users tax 7,095,237 7,095,237
Franchise fees 5,166,543 5,166,543
Other taxes 8,721,612 8,721,612
Investment earnings 9,467,690 4,997,084 14,464,774
Gain from sale of capital assets 2,248 2,248
Miscellaneous 1,048,185 795,073 1,843,258
Transfers (Note 6) 2,041,050 (2,041,050)
Total general revenues and transfers 112,135,852 6,478,412 118,614,264 Change in Net Position 10,169,414 7,627,712 17,797,126
Net Position-Beginning 78,182,370 122,096,685 200,279,055 Net Position-Ending $88,351,784 $129,724,397 $218,076,181 See accompanying notes to financial statements

STATEMENT OF ACTIVITIES
Program Revenues
21

FUND FINANCIAL STATEMENTS
Major funds are defined generally as having significant activities or balances in the current year.

23

CITY OF DALY CITY

GOVERNMENTAL FUNDS

BALANCE SHEET
JUNE 30, 2024
Other Total
Measures Capital Governmental Governmental
General Gas Tax Grants A and W Projects Funds Funds
ASSETS
Cash and investments (Note 2G) $70,567,432 $11,532,905 $446,833 $12,639,215 $39,548,266 $7,087,808 $141,822,459 Restricted cash and investments (Note 2G) 4,767,252 4,767,252 Accounts receivable, net 12,269,727 927,104 447,977 199,136 37,986 401,704 14,283,634 Due from other funds (Note 6) 152,110 152,110
Prepaids (Note 2H) 37,550 81,066 118,616
Inventories (Note 2H) 18,888 21,196 40,084
Notes receivable (Note 13) 440,744 822,343 1,263,087
Loan receivable from Successor Agency (Note 15C) 9,621,859 9,621,859 Leases receivable (Note 7) 8,575,324 8,575,324
Property held for development (Note 2C) 3,366,888 3,366,888 Total Assets $106,010,142 $12,481,205 $1,416,620 $12,838,351 $39,586,252 $11,678,743 $184,011,313

LIABILITIES
Accounts payable $9,054,763 $635,208 $318,928 $147,960 $1,142,609 $204,013 $11,503,481 Accrued payroll 1,315,106 33,682 4,103 7,129 1,360,020
Due to other funds (Note 6) 152,110 152,110
Deposits payable 6,900,790 4,001 6,904,791
Unearned revenue 3,590,382 3,255,078 1,632,569 8,478,029 Total Liabilities 20,861,041 3,923,968 323,031 147,960 2,775,178 367,253 28,398,431

DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - accounts receivable 77,403 77,403 Unavailable revenue - loans 440,744 822,343 1,263,087
Related to leases (Note 7) 8,223,628 8,223,628
Total Deferred Inflows of Resources 8,223,628 518,147 822,343 9,564,118

FUND BALANCES
Fund Balance (Note 12)
Nonspendable 10,038,350 21,196 81,066 10,140,612
Restricted 5,767,252 8,536,041 494,376 12,690,391 12,945,510 10,489,147 50,922,717 Assigned 611,754 23,865,564 24,477,318
Unassigned 60,508,117 60,508,117
Total Fund Balances 76,925,473 8,557,237 575,442 12,690,391 36,811,074 10,489,147 146,048,764 Total Liabilities, Deferred Inflows of
Resources and Fund Balances $106,010,142 $12,481,205 $1,416,620 $12,838,351 $39,586,252 $11,678,743 $184,011,313 See accompanying notes to financial statements
24

CITY OF DALY CITY
Reconciliation of the

GOVERNMENTAL FUNDS - BALANCE SHEET
with the

STATEMENT OF NET POSITION
JUNE 30, 2024
Total fund balances reported on the Governmental Funds Balance Sheet $146,048,764 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. 95,301,235

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 54,041,672
Accounts receivable 465,463
Prepaids 1,751,356
Deferred outflows 439,458
Inventories 228,028
Internal balances (1,735,270)
Capital assets 12,174,973
Accounts payable (762,318)
Accrued payroll (81,160)
Interest payable (40,636)
Accrued claims payable (10,784,000)
Compensated absences (1,656,972)
Net OPEB liability (2,326,633)
Deferred inflows (504,243)
Subscription liabilities - due within one year (482,845) Subscription liabilities - due in more than one year (1,072,681) Long-term debt - due within one year (456,190)
Long-term debt - due in more than one year (2,039,353)

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. 1,340,490

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 64,266,680
Deferred inflows (5,655,195)

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:

Leases payable (34,463)
Subscription liabilities (3,048,224)
Net OPEB liability (25,920,669)
Net pension liability (214,271,247)
Compensated absences (16,834,236)
NET POSITION OF GOVERNMENTAL ACTIVITIES $88,351,784
See accompanying notes to financial statements
25

CITY OF DALY CITY

GOVERNMENTAL FUNDS

STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE YEAR ENDED JUNE 30, 2024
Other Total
Measures Capital Governmental Governmental
General Gas Tax Grants A and W Projects Funds Funds

REVENUES
Property tax $52,139,564 $52,139,564
Gas tax $5,521,712 5,521,712
Sales tax 26,455,971 $3,766,051 30,222,022
Utility users tax 7,095,237 7,095,237
Franchise fees 5,166,543 5,166,543
Other taxes 8,721,612 8,721,612
Licenses and permits 2,587,982 2,587,982
Fines and forfeitures 2,408,106 2,408,106
Rents and interest 3,442,315 615,317 $17,485 998,923 $2,464,710 $230,901 7,769,651 Federal programs and grants 5,635,834 357,898 90,999 98,907 1,147,886 7,331,524 Receipts from other agencies 1,752,355 1,282,918 2,843,219 572,366 6,450,858 Charges and fees 7,689,635 1,099,043 1,628,048 121,501 10,538,227 Miscellaneous 1,625,417 35,376 161,954 250,508 2,073,255 Total Revenues 124,720,571 8,912,264 2,951,703 4,764,974 4,925,985 1,750,796 148,026,293

EXPENDITURES
Current:

General government 14,081,449 56,609 5,000 14,143,058
Public safety 74,700,332 2,708,011 10,930 77,419,273
Public works 6,576,604 5,393,120 23,170 11,992,894
Culture and recreation 16,120,989 203,110 16,324,099
Economic and community development 5,373,801 72,663 1,491,375 6,937,839 Capital projects 8,924,385 300,514 6,513,071 15,737,970 Debt service:

Principal 610,137 229,861 839,998
Interest 8,569 3,389 11,958
Total Expenditures 117,471,881 14,317,505 3,574,157 5,000 6,513,071 1,525,475 143,407,089

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 7,248,690 (5,405,241) (622,454) 4,759,974 (1,587,086) 225,321 4,619,204

OTHER FINANCING SOURCES (USES)
Issuance of long-term debt (Note 14) 728,611 738,009 1,466,620 Transfers in (Note 6) 3,232,234 5,741,345 6,009 9,595,491 259,282 18,834,361 Transfers (out) (Note 6) (12,518,004) (465,535) (3,464,082) (180,648) (62,056) (16,690,325) Total Other Financing Sources (Uses) (8,557,159) 5,275,810 744,018 (3,464,082) 9,414,843 197,226 3,610,656 NET CHANGES IN FUND BALANCES (1,308,469) (129,431) 121,564 1,295,892 7,827,757 422,547 8,229,860 BEGINNING FUND BALANCES 78,233,942 8,686,668 453,878 11,394,499 28,983,317 10,066,600 137,818,904 ENDING FUND BALANCES $76,925,473 $8,557,237 $575,442 $12,690,391 $36,811,074 $10,489,147 $146,048,764 See accompanying notes to financial statements
26

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 $8,229,860 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 (less prepaid asset of $81,066) are therefore added back to fund balance. 8,667,480
Depreciation expense is deducted from fund balance
(Depreciation expense is net of internal service fund depreciation of $1,942,874 which has already been allocated to serviced funds). (4,897,688) Remeasurement of subscription asset is added to fund balance 293,075

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 lease principal is added back to fund balance 78,888 Repayment of subscription liability principal is added back to fund balance 761,110 Proceeds from new SBITAs are deducted from fund balance (1,466,620)

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 (843,515)
Compensated absences (501,267)
OPEB expense 2,257,256
Pension expense (14,905,406)

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 12,496,241 CHANGE IN NET POSITION OF GOVERNMENTAL ACTIVITIES $10,169,414 See accompanying notes to financial statements
FOR THE YEAR ENDED JUNE 30, 2024
27

CITY OF DALY CITY

GENERAL FUND

STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE

BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2024
Variance with
Budgeted Amounts Final Budget
Positive
Original Final Actual Amounts (Negative)

REVENUES
Property tax $46,096,301 $46,496,301 $52,139,564 $5,643,263 Sales tax 26,234,600 26,841,600 26,455,971 (385,629)
Utility users tax 5,577,431 5,577,431 7,095,237 1,517,806 Franchise fees 5,268,569 5,268,569 5,166,543 (102,026)
Other taxes 7,706,751 8,034,094 8,721,612 687,518
Licenses and permits 2,437,684 2,319,135 2,587,982 268,847 Fines and forfeitures 4,644,022 4,644,022 2,408,106 (2,235,916) Rents and interest 2,251,859 2,241,859 3,442,315 1,200,456 Federal programs and grants 3,000,000 10,505,846 5,635,834 (4,870,012) Receipts from other agencies 642,779 1,282,460 1,752,355 469,895 Charges and fees 7,144,503 7,594,285 7,689,635 95,350
Miscellaneous 386,011 505,715 1,625,417 1,119,702
Total Revenues 111,390,510 121,311,317 124,720,571 3,409,254

EXPENDITURES
Current Operations:

General Government
Legislative:

Salaries and benefits 335,534 335,534 305,796 29,738
Services and supplies 74,630 74,630 50,088 24,542
Other charges 44,163 44,163 32,152 12,011
Total Legislative 454,327 454,327 388,036 66,291
Legal:

Salaries and benefits 1,241,957 1,241,957 1,249,933 (7,976) Services and supplies 778,368 780,741 285,947 494,794
Other charges 13,083 13,083 6,308 6,775
Total Legal 2,033,408 2,035,781 1,542,188 493,593
Administrative:

Salaries and benefits 1,460,541 1,460,541 8,708,693 (7,248,152) Services and supplies 3,204,509 3,275,265 2,840,543 434,722 Other charges 969,111 936,750 601,989 334,761
Total Administrative 5,634,161 5,672,556 12,151,225 (6,478,669) Total General Government 8,121,896 8,162,664 14,081,449 (5,918,785) Public Safety
Police:

Salaries and benefits 41,034,720 41,034,720 33,323,543 7,711,177 Services and supplies 7,849,081 8,069,697 7,397,346 672,351 Capital outlay 274,510 437,795 894,938 (457,143)
Other charges 781,537 780,537 767,428 13,109
Total Police 49,939,848 50,322,749 42,383,255 7,939,494 Fire:

Salaries and benefits 27,199,561 27,199,564 28,193,864 (994,300) Services and supplies 3,696,828 3,696,827 3,626,433 70,394 Capital outlay 362,362 362,362 232,005 130,357
Other charges 73,183 102,296 264,775 (162,479)
Total Fire 31,331,934 31,361,049 32,317,077 (956,028)
Total Public Safety 81,271,782 81,683,798 74,700,332 6,983,466 (Continued)
28

CITY OF DALY CITY

GENERAL FUND

STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE

BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2024
Variance with
Budgeted Amounts Final Budget
Positive
Original Final Actual Amounts (Negative)
Public Works
Salaries and benefits 5,772,844 5,772,844 4,191,592 1,581,252 Services and supplies 2,454,041 2,797,484 2,263,077 534,407 Capital outlay 6,000 8,664 (2,664)
Other charges 35,293 29,293 113,271 (83,978)
Total Public Works 8,262,178 8,605,621 6,576,604 2,029,017 Culture and Recreation
Salaries and benefits 10,063,241 10,477,502 9,546,765 930,737 Services and supplies 6,105,314 6,699,189 6,429,896 269,293 Capital outlay 55,000 19,149 4,849 14,300
Other charges 3,440 3,440 139,479 (136,039)
Total Culture and Recreation 16,226,995 17,199,280 16,120,989 1,078,291 Economic and Community Development
Salaries and benefits 4,374,286 4,374,286 3,726,558 647,728 Services and supplies 1,262,016 2,095,952 1,538,751 557,201 Other charges 58,348 131,959 108,492 23,467
5,694,650 6,602,197 5,373,801 1,228,396
Debt service:

Principal 610,137 (610,137)
Interest 8,569 (8,569)
618,706 (618,706)
Total Expenditures 119,577,501 122,253,560 117,471,881 4,781,679

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (8,186,991) (942,243) 7,248,690 8,190,933

OTHER FINANCING SOURCES (USES)
Issuance of long-term debt 728,611 728,611
Transfers in 2,972,293 3,232,234 3,232,234
Transfers out (3,198,616) (10,710,781) (12,518,004) (1,807,223) Total Other Financing Sources (Uses) (226,323) (7,478,547) (8,557,159) (1,078,612) NET CHANGE IN FUND BALANCE ($8,413,314) ($8,420,790) (1,308,469) $7,112,321 BEGINNING FUND BALANCE 78,233,942
ENDING FUND BALANCE $76,925,473
See accompanying notes to financial statements
Total Economic and Community Development
29

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, 2024
Variance with
Budgeted Amounts Final Budget
Positive
Original Final Actual Amounts (Negative)

REVENUES
Gas tax $5,585,677 $5,585,677 $5,521,712 ($63,965)
Rents and interest 70,000 70,000 615,317 545,317
Federal programs and grants 3,200,000 3,721,648 357,898 (3,363,750) Receipts from other agencies 300,000 7,904,473 1,282,918 (6,621,555) Charges and services 1,070,484 1,070,484 1,099,043 28,559 Miscellaneous 11,000 11,000 35,376 24,376
Total Revenues 10,237,161 18,363,282 8,912,264 (9,451,018)

EXPENDITURES
Public works 5,501,684 5,574,434 5,393,120 181,314
Capital projects 9,526,476 37,655,207 8,924,385 28,730,822 Total Expenditures 15,028,160 43,229,641 14,317,505 28,912,136

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (4,790,999) (24,866,359) (5,405,241) 19,461,118

OTHER FINANCING SOURCES (USES)
Transfers in 5,270,508 18,044,778 5,741,345 (12,303,433) Transfers out (304,958) (304,958) (465,535) (160,577)
Total Other Financing Sources (Uses) 4,965,550 17,739,820 5,275,810 (12,464,010) NET CHANGE IN FUND BALANCE $174,551 ($7,126,539) (129,431) $6,997,108 BEGINNING FUND BALANCE 8,686,668
ENDING FUND BALANCE $8,557,237
See accompanying notes to financial statements
30

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, 2024
Variance
Positive
Original Final Actual (Negative)

REVENUES
Gas tax $270,827 ($270,827)
Rents and interest $2,000 2,000 $17,485 15,485
Federal programs and grants 1,642,994 90,999 (1,551,995) Receipts from other agencies 158,889 10,466,801 2,843,219 (7,623,582) Miscellaneous revenue 44,069 (44,069)
Total Revenues 160,889 12,426,691 2,951,703 (9,474,988)

EXPENDITURES
General Government
Administrative:

Services and supplies 390,485 56,609 333,876
Total General Government 390,485 56,609 333,876
Public Safety
Salaries and benefits 182,602 1,652,656 172,249 1,480,407 Services and supplies 2,415,880 630,485 1,785,395
Capital outlay 374,120 950,026 (575,906)
Other charges 4,181,799 955,251 3,226,548
Total Public Safety 182,602 8,624,455 2,708,011 5,916,444 Public Works
Capital Outlay 796,267 300,514 495,753
Total Public Works 796,267 300,514 495,753
Culture and Recreation
Services and supplies 203,483 203,110 373
Total Culture and Recreation 203,483 203,110 373
Economic and Community Development
Salaries and benefits 85,742 71,823 13,919
Services and supplies 108,139 840 107,299
Other charges 2,820,925 2,820,925
Total Economic and Community Development 3,014,806 72,663 2,942,143 Debt service:

Principal 229,861 (229,861)
Interest 3,389 (3,389)
233,250 (233,250)
Total Expenditures 182,602 13,029,496 3,574,157 9,455,339

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (21,713) (602,805) (622,454) (19,649)

OTHER FINANCING SOURCES (USES)
Issuance of long-term debt 738,009 738,009
Transfers in 64,463 89,463 6,009 (83,454)
NET CHANGE IN FUND BALANCE $42,750 ($513,342) 121,564 $634,906 BEGINNING FUND BALANCE 453,878
ENDING FUND BALANCE $575,442
Budgeted Amounts
See accompanying notes to financial statements
31

CITY OF DALY CITY

MEASURES A AND W SPECIAL REVENUE FUND

STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCE

BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2024
Variance
Positive
Original Final Actual (Negative)

REVENUES
Sales taxes $3,876,823 $3,876,823 $3,766,051 ($110,772) Rents and interest 40,000 40,000 998,923 958,923
Total Revenues 3,916,823 3,916,823 4,764,974 848,151

EXPENDITURES
General Government
Administrative:

Services and supplies 5,200 5,200 5,000 200
Total Expenditures 5,200 5,200 5,000 200

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 3,911,623 3,911,623 4,759,974 848,351

OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out (3,021,000) (14,345,505) (3,464,082) 10,881,423 NET CHANGE IN FUND BALANCE $890,623 ($10,433,882) 1,295,892 $11,729,774 BEGINNING FUND BALANCE 11,394,499
ENDING FUND BALANCE $12,690,391
Budgeted Amounts
See accompanying notes to financial statements
32

CITY OF DALY CITY

PROPRIETARY FUNDS

STATEMENT OF NET POSITION
JUNE 30, 2024
Business-type Activities-Enterprise Funds Governmental
Nonmajor - ActivitiesWater Sanitation Civic Transfer Internal Service Utility District Center Station Totals Funds
ASSETS
Current Assets:

Cash and investments (Note 2G) $32,384,413 $34,146,040 $1,902,315 $1,539,588 $69,972,356 $54,041,672 Accounts receivable, net (Note 2I) 6,080,597 1,191,815 24,065 7,296,477 465,463 Inventories (Note 2H) 405,825 1,656,614 2,062,439 228,028 Prepaids 601 41,271 41,872 1,832,422
Total Current Assets 38,871,436 37,035,740 1,926,380 1,539,588 79,373,144 56,567,585 Noncurrent Assets:

Leases receivable (Note 7) 8,379,917 8,379,917
Capital Assets (Note 4):

Land 839,856 233,547 1,695,762 93,384 2,862,549 378,343 Buildings 272,379 893,519 5,568,728 1,184,278 7,918,904 35,817 Sewage facilities 59,413,041 59,413,041
Wells and pump stations 9,074,783 9,074,783
Water reservoirs 12,715,925 12,715,925
Mains and subsurface lines 21,568,821 26,871,004 48,439,825 Equipment 7,527,606 10,281,888 936,705 20,912 18,767,111 25,762,246 Furniture and fixtures 37,154 114,174 151,328 63,104
Subscription assets 2,328,793
Construction in progress 2,726,084 13,664,605 16,390,689 179,992 Total Capital Assets 54,762,608 111,471,778 8,201,195 1,298,574 175,734,155 28,748,295 Less accumulated depreciation (31,236,578) (70,099,235) (5,670,607) (1,205,190) (108,211,610) (16,573,322) Net Capital Assets 23,526,030 41,372,543 2,530,588 93,384 67,522,545 12,174,973 Total Noncurrent Assets 23,526,030 41,372,543 10,910,505 93,384 75,902,462 12,174,973 Total Assets 62,397,466 78,408,283 12,836,885 1,632,972 155,275,606 68,742,558

DEFERRED OUTFLOWS OF RESOURCES
Related to pension (Note 8D) 1,220,230 3,102,120 4,322,350 Related to OPEB (Note 9) 259,955 569,426 829,381 439,458 Total Deferred Outflows 1,480,185 3,671,546 5,151,731 439,458

LIABILITIES
Current Liabilities:

Accounts payable 1,167,224 1,936,772 20,977 3,124,973 762,318 Accrued payroll 56,654 150,597 207,251 81,160
Deposits payable 28,600 28,600
Interest payable 40,636
Accrued claims payable (Note 11) 2,928,869
Compensated absences (Note 2K) 289,167 663,861 953,028
Long-term debt (Note 5) 939,035
Total Current Liabilities 1,541,645 2,751,230 20,977 4,313,852 4,752,018 Noncurrent Liabilities:

Compensated absences (Note 2K) 238,480 1,389,659 1,628,139 1,656,972 Accrued claims payable (Note 11) 7,855,131
Net OPEB liability (Note 9) 1,376,319 3,014,793 4,391,112 2,326,633 Net Pension Liability (Note 8C) 3,902,340 9,920,691 13,823,031 Long-term debt (Note 5) 3,112,034
Total Noncurrent Liabilities 5,517,139 14,325,143 19,842,282 14,950,770 Total Liabilities 7,058,784 17,076,373 20,977 24,156,134 19,702,788

DEFERRED INFLOWS OF RESOURCES
Related to pension (Note 8D) 1,892 4,810 6,702
Related to OPEB (Note 9) 298,285 653,386 951,671 504,243 Related to leases (Note 7) 7,323,703 7,323,703
Total Deferred Inflows 300,177 658,196 7,323,703 8,282,076 504,243 NET POSITION (Note 12)
Net investment in capital assets 23,526,030 41,372,543 2,530,588 93,384 67,522,545 8,123,904 Restricted for:

Qualified capital outlay 605,397 605,397
Unrestricted 32,992,660 22,367,320 2,961,617 1,539,588 59,861,185 40,851,081 Total Net Position $56,518,690 $64,345,260 $5,492,205 $1,632,972 127,989,127 $48,974,985 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 1,735,270 Net position of business-type activities $129,724,397
See accompanying notes to financial statements
33

CITY OF DALY CITY

PROPRIETARY FUNDS

STATEMENT OF REVENUES, EXPENSES

AND CHANGES IN FUND NET POSITION
FOR THE YEAR ENDED JUNE 30, 2024
Business-type Activities-Enterprise Funds Governmental
Nonmajor - ActivitiesWater Sanitation Civic Transfer Internal Service Utility District Center Station Totals Funds

OPERATING REVENUES
Water sales $29,346,716 $80,469 $29,427,185
Sewer service charges 25,374,760 25,374,760
Connection charges 212,450 212,450
Rental income $1,293,382 1,293,382
Charges to City departments $32,056,638
Lease revenues 6,750
Other revenues 492,495 99,044 88,954 $114,580 795,073 1,100,326 Total Operating Revenues 29,839,211 25,766,723 1,382,336 114,580 57,102,850 33,163,714

OPERATING EXPENSES
Salaries and benefits 4,761,168 12,791,801 17,552,969 7,381,362 Services and supplies 2,535,460 13,196,570 623,834 16,355,864 4,448,011 Water purchases 8,490,359 8,490,359
Utilities 1,253,533 2,267,018 230,518 3,751,069 608,467 Insurance 439,581 1,116,721 31,750 1,588,052 4,821,475
Claims and settlements 3,906,938
Depreciation (Note 4) 1,355,628 2,295,520 190,306 3,841,454 1,942,874 Other charges 2,033,167 2,171,383 4,204,550 351,943
Total Operating Expenses 20,868,896 33,839,013 1,076,408 55,784,317 23,461,070 Operating Income (Loss) 8,970,315 (8,072,290) 305,928 114,580 1,318,533 9,702,644

NONOPERATING REVENUES (EXPENSES)
Property taxes 2,725,057 2,725,057
Intergovernmental 456,481 461,116 917,597
Gain on sale of inventory 2,248 2,248 237,041
Loss on sale of capital assets (438,216)
Interest income 2,258,094 2,582,011 156,979 4,997,084 3,168,536 Interest expense (11,733) (6,955) (18,688) (343,847)
Total Nonoperating Revenues (Expenses) 2,702,842 5,763,477 156,979 8,623,298 2,623,514 Income (Loss) Before Transfers 11,673,157 (2,308,813) 462,907 114,580 9,941,831 12,326,158 Transfers in (Note 6) 171,504 3,353,309 3,524,813 1,094,695 Transfers (out) (Note 6) (3,893,958) (1,189,780) (361,816) (120,309) (5,565,863) (1,197,681) Net transfers (3,722,454) 2,163,529 (361,816) (120,309) (2,041,050) (102,986) CHANGE IN NET POSITION 7,950,703 (145,284) 101,091 (5,729) 7,900,781 12,223,172 BEGINNING NET POSITION 48,567,987 64,490,544 5,391,114 1,638,701 120,088,346 36,751,813 ENDING NET POSITION $56,518,690 $64,345,260 $5,492,205 $1,632,972 127,989,127 $48,974,985 Net change in net position 7,900,781
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. (273,069)
Change in net position of business-type activities $7,627,712 See accompanying notes to financial statements
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CITY OF DALY CITY

PROPRIETARY FUNDS

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2024
Governmental
Nonmajor - ActivitiesSanitation Civic Transfer Internal Service Water Utility District Center Station Totals Funds

CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers $29,736,448 $26,222,171 $1,105,624 $114,580 $57,178,823 $32,805,746 Payments to suppliers (14,481,923) (18,591,771) (870,907) (33,944,601) (10,661,694) Payments to employees (4,673,185) (12,250,044) (16,923,229) (7,550,193) Claims paid (3,195,938)
Cash Flows from Operating Activities 10,581,340 (4,619,644) 234,717 114,580 6,310,993 11,397,921

CASH FLOWS FROM NONCAPITAL

FINANCING ACTIVITIES
Property tax 2,725,057 2,725,057
Intergovernmental 456,481 461,116 917,597
Principal paid on noncapital debt (4,325,000)
Interest paid on noncapital debt (255,002)
Transfers in 171,504 3,353,309 3,524,813 1,094,695
Transfers out (3,893,958) (1,189,780) (361,816) (120,309) (5,565,863) (1,197,681) Cash Flows from (used for) Noncapital Financing Activities (3,265,973) 5,349,702 (361,816) (120,309) 1,601,604 (4,682,988)

CASH FLOWS FROM CAPITAL AND RELATED

FINANCING ACTIVITIES
Proceeds from sale of assets 2,248 2,248 237,041
Acquisition of capital assets (2,441,782) (2,656,265) (5,098,047) (3,152,892) Principal paid on subscription liabilities (294,163)
Interest paid on subscription liabilities (6,816)
Principal paid on capital debt (640,000) (556,791) (1,196,791) (421,769) Interest paid on capital debt (12,800) (15,075) (27,875) (119,435) Cash Flows from (used for) Capital and
Related Financing Activities (3,094,582) (3,225,883) (6,320,465) (3,758,034) CASH FLOWS FROM INVESTING ACTIVITIES:

Interest income (expense) 2,258,094 2,582,011 156,979 4,997,084 3,168,536 Net Cash Flows 6,478,879 86,186 29,880 (5,729) 6,589,216 6,125,435 Cash and investments at beginning of period 25,905,534 34,059,854 1,872,435 1,545,317 63,383,140 47,916,237 Cash and investments at end of period $32,384,413 $34,146,040 $1,902,315 $1,539,588 $69,972,356 $54,041,672 Reconciliation of Operating Income (Loss) to Cash Flows from Operating Activities:

Operating income (loss) $8,970,315 ($8,072,290) $305,928 $114,580 $1,318,533 $9,702,644 Adjustments to reconcile operating income (loss) to cash flows from operating activities:

Depreciation 1,355,628 2,295,520 190,306 3,841,454 1,942,874 Change in assets and liabilities:

Accounts receivable, net (99,163) 455,448 19,225 375,510 (357,968) Inventories (12,475) (68,518) (80,993) (33,243)
Prepaids (601) (40,721) (41,322) (1,965)
Accounts payable 283,253 269,160 15,195 567,608 (396,590) Accrued payroll 383 19,333 19,716 (229)
Deposits payable (3,600) (3,600)
Accrued claims payable 711,000
Compensated absences (50,827) 3,062 (47,765) 145,801
Leases-related activity (295,937) (295,937)
Due to OPEB system 61,732 (433,863) (372,131) (314,403) Due to retirement system 76,695 953,225 1,029,920
Cash Flows from Operating Activities $10,581,340 ($4,619,644) $234,717 $114,580 $6,310,993 $11,397,921

NONCASH TRANSACTIONS
Retirement of capital assets ($25,456)
Remeasurement of subscription asset (91,019)
Remeasurement of subscription liability $91,019
See accompanying notes to financial statements
Business-type Activities-Enterprise Funds
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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.
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CITY OF DALY CITY

FIDUCIARY FUNDS

STATEMENT OF FIDUCIARY NET POSITION
JUNE 30, 2024
Successor Agency Custodial Funds
to the External
Redevelopment Agency Custodial Investment
Private-Purpose Trust Funds Pool Fund
ASSETS
Cash and investments (Note 2G) $232,262 $2,191,000 $1,366,529 Receivables 2,054,881
Total Assets 232,262 4,245,881 1,366,529

LIABILITIES
Accounts payable 3,585,981
Deposits payable 4,050
Loans payable to City (Note 15C) 9,621,859
Total Liabilities 9,625,909 3,585,981

NET POSITION
Restricted for:

Other agencies and organizations (9,393,647) 659,900
Pool participant 1,366,529
Total Net Position ($9,393,647) $659,900 $1,366,529
See accompanying notes to financial statements
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CITY OF DALY CITY

STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FOR THE YEAR ENDED JUNE 30, 2024
Successor Agency Custodial Funds
to the External
Redevelopment Agency Custodial Investment
Private-Purpose Trust Funds Pool Fund

ADDITIONS
Taxes $1,285,294
Receipts from other agencies $50,000
Rents and interest 18,375 $78,556
Other receipts 215 5,513,204
Total additions 1,303,884 50,000 5,591,760

DEDUCTIONS
Services and supplies 9,710
Culture and recreation 1,832
Other payments 5,205,582
Total deductions 9,710 1,832 5,205,582
CHANGE IN NET POSITION 1,294,174 48,168 386,178

NET POSITION
Net Position (Deficit) - Beginning (10,687,821) 611,732 980,351 Net Position (Deficit) - Ending ($9,393,647) $659,900 $1,366,529 See accompanying notes to financial statements
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CITY OF DALY CITY

ANNUAL COMPREHENSIVE FINANCIAL REPORT

NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2024
NOTE 1.

REPORTING ENTITY
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 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 entities are controlled by governing boards consisting of the City Council and are reported as blended component units. Council members are financially accountable for these entities’ operations and approve fees, debt issues and adopt budgets. Blended component units, although legally separate entities are, in substance, part of the government’s operations, thus, data from these units are combined with that of the primary government.

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.

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 Development Finance Agency (Finance Agency) are included in the Affordable Housing and the Low and Moderate Income Housing Assets Special Revenue Funds.

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.
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The City and the Sanitation District established the Daly City Joint Powers Financing Authority (Financing Authority) in March 2022 pursuant to the Joint Exercise of Powers Act (commencing at Government Code Section 6500) to provide assistance with public financings, including, among others, General Fund lease financings and enterprise fund financings. The Financing Authority 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 Financing Authority. The Financing Authority does not issue separate financial statements. The Financing Authority did not have any activity during the year ended June 30, 2024.

NOTE 2.

DESCRIPTION OF FUNDS AND SUMMARY OF ACCOUNTING POLICIES 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, the Daly City Public Facilities Financing Corporation and the Daly City Joint Powers Financing Authority (see Note 1).

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 blended 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, intergovernmental 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 specifically 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.

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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.

MEASURES A AND W SPECIAL REVENUE FUND is used to account for the City’s portion of the Measure A special half cent sales tax receipts restricted for maintaining local streets and roads improvements and the City’s portion of the Measure W special half cent sales tax receipts restricted for congestion relief and transit improvements.

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.

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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.

CIVIC CENTER FUND is used to account for rental activity of real property owned by the City in the Civic Center area.

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-insurance 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 Redevelopment 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 PreHospital 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.

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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, including lease liabilities, as well as claims and judgments, and compensated absences, which are recognized as expenditures to the extent they have matured. Governmental capital asset acquisitions are reported as expenditures in governmental funds, including entering into contracts giving the City the right to use leased assets and right to use subscription assets. Proceeds of governmental long-term debt and financing through 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 assets 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 assets or fund balance 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 and deferred amounts related to leases. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available.

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 unrestricted 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.
45

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. Due to the COVID-19 pandemic and ongoing economic uncertainties, the City moved to a one-year budget cycle starting in FY2021. The City is monitoring and evaluating the economic climate in hopes of switching back to a biennial budget process. 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.

Expenditures in Excess of Appropriations – The General Fund incurred expenditures in excess as follows during the fiscal year ending June 30, 2024:

Expenditures
Exceeded Budget
General Fund
General Government $5,918,785
Public Safety - Fire 956,028
Transfers out 1,807,223
Debt service 618,706
Sufficient resources were available within the fund to finance these expenditures. 46

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 which 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 invested 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 the basis of average daily cash and investment balances in each fund, unless there are specific legal or contractual requirements to do otherwise.

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 $265,836,487
Restricted cash and investments 4,767,252
Cash and investments of the City 270,603,739
Cash and investments in Fiduciary Funds (separate statement):

Private-purpose Trust Fund 232,262
Custodial Funds 2,191,000
Custodial Funds - External investment pool 1,366,529
Total cash and investments $274,393,530
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Investments Authorized by the California Government Code and the City’s Investment Policy The City’s Investment Policy and the California Government Code allow the City to invest in the following, provided the credit ratings of the issuers are acceptable to the City and approved percentages and 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 Municipal Securities/Registered Treasury Noted or Bonds 5 years A 30% 5% U.S. Treasuries 5 years N/A No Limit No Limit
Federal Agencies 5 years N/A 20% 30%
Banker’s Acceptances 180 days A-1/A 40% 5%
Commercial Paper 270 days A-1/A 25% 5%
Negotiable Certificates of Deposit 5 years A-1/A 30% 5% Non-Negotiable Certificates of Deposit 5 years N/A 20% No Limit Placement Service Deposits 5 years N/A 30% No Limit
Collateralized Bank Deposits Upon
Demand
N/A No Limit No Limit
Repurchase Agreements 1 year N/A No Limit No Limit
State of California Local Agency Investment Fund (LAIF) Upon Demand
N/A $75,000,000
per account
$75,000,000
per account
Local Government Investment Pools (LGIP) Upon
Demand
N/A No Limit No Limit
Corporate Medium Term Notes 5 years A 30% 5%
Asset-Backed, Mortgage Backed, Mortgage Pass-Through Securities, & Collateralized Mortgage Obligations
5 years* AA 20% 5%
Mutual Funds Upon
Demand
Highest
Ranking by
two NRSROs
10% No Limit
Money-Market Mutual Funds Upon
Demand
Highest
Ranking by
two NRSROs
20% No Limit
Supranationals 5 Years AA 30% 10%
*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 year Public Agencies Post-Employment Trust
On May 22, 2017, the City Council adopted resolution 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 investment approach which allows the City to maintain oversight of the investment 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. 48

Investments Authorized by Debt Agreements
The City must maintain required amounts of cash and 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 accordance with City ordinance, bond indentures or State statute.

The following table identifies the investment types that are authorized for investments held by fiscal agents. The table also identifies certain provisions of these debt agreements:

Minimum Maximum Maximum
Maximum Credit In Investment
Authorized Investment Type Maturity Quality Portfolio In One Issuer U. S. Treasury Bonds, Notes and Bills N/A N/A No Limit No Limit U.S. Government Agency Securities and
U.S. Government Sponsored Enterprise N/A AAA No Limit No Limit State Obligations
N/A
Highest Rating
Category No Limit No Limit
Commercial Paper 270 Days 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 Limit No Limit
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
Investment Fund (LAIF Pool) Upon Demand N/A No Limit No Limit Municipal Obligations N/A AAA No Limit No Limit
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 $5,203,982 $19,069,662 $302,078 $24,575,722 California Local Agency Investment Fund 25,583,879 25,583,879 California Asset Management Program 40,359,246 40,359,246 San Mateo County Investment Pool 145,299,484 145,299,484 Negotiable Certificates of Deposit 6,868,124 17,274,754 24,142,878 PARS Moderately Conservative Index PLUS Fund 4,767,252 4,767,252 Total Investments $228,081,967 $36,344,416 $302,078 264,728,461 Cash in Bank and On Hand 9,665,069
Total Cash and Investments $274,393,530
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-backed 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, 2024, these investments have an average maturity of 217 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, 2024, these investments matured in an average of 1.64 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. 50

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, 2024 are provided by Standard and Poor’s except as noted.

Total
Investment Type AA+/AA/A-1 Investments
U.S. Government Agency Securities $17,419,507 $17,419,507 San Mateo County Investment Pool 145,299,484 145,299,484 Total $162,718,991 162,718,991
Not rated:

U.S. Government Agency Securities 7,156,215
California Local Agency Investment Fund 25,583,879
California Asset Management Program 40,359,246
Negotiable Certificates of Deposit 24,142,878
PARS Moderately Conservative Index PLUS Fund 4,767,252
Total Investments $264,728,461
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 securities 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 Level 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, 2024:

Investment Type Level 2 Total
Investments by Fair Value Level:

U.S. Government Agency Securities $24,575,722 $24,575,722 Negotiable Certificates of Deposit 24,142,878 24,142,878 Subtotal $48,718,600 48,718,600
Investments Measured at Amortized Cost:

PARS Moderately Conservative Index PLUS Fund 4,767,252
Investments Not Subject to the Fair Value Hierarchy:

California Local Agency Investment Fund 25,583,879
California Asset Management Program 40,359,246
San Mateo County Investment Pool 145,299,484
Total Investments $264,728,461
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. 52

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.

J. ADVANCES TO OTHER FUNDS AND AGENCIES
Current portions of interfund loans receivable (reported 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 compensated 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, 2023 $17,844,140 $2,628,932 $20,473,072 Additions 8,268,886 1,331,578 9,600,464
Payments (7,621,818) (1,379,343) (9,001,161)
Balance June 30, 2024 $18,491,208 $2,581,167 $21,072,375 Due within one year $6,121,560 $953,028 $7,074,588
Compensated absences are liquidated by the fund that has recorded the liability. Governmental activities compensated absences are liquidated primarily by the General Fund. 53

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.

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, net 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. 54

NOTE 3.

COMMITMENTS AND CONTINGENCIES
A. CONSTRUCTION CONTRACTS
At June 30, 2024, the City had made commitments of approximately $21.8 million for construction work, legal and consulting fees, and purchases of supplies and equipment, which includes the encumbrances in Note 3C below.

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 yearend. Encumbrances outstanding as of June 30, 2024 were $611,754 in the General Fund, $994,129 in the Gas Tax Special Revenue Fund, $293,510 in the Grants Special Revenue Fund, $4,669,947 in the Capital Projects Fund, and $1,880,473 in nonmajor governmental funds.

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.

NOTE 4.

CAPITAL ASSETS
All capital assets are valued at historical cost or estimated historical cost if actual historical cost is not available, except for intangible right to‐use lease assets, the measurement of which is discussed in Note 7 below and intangible right to use subscription assets the measurement of which is discussed in Note 14 below. Donated capital assets, donated works of art and similar items, and capital assets received in a service concession arrangement are reported at acquisition 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.

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The City depreciates capital assets over their estimated useful lives. The 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.

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 expense 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
Right to Use Leased Building 2 years Water Reservoirs 40-99 years Right-to-use Subscription Assets 3 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 projects are constructed. 56

A. CAPITAL ASSET ADDITIONS AND RETIREMENTS
Capital assets at June 30 comprise:

Balance Retirements/ Balance
June 30, 2023 Additions Adjustments Transfers June 30, 2024 Governmental activities:

Capital assets not being depreciated:

Land $27,856,486 $27,856,486
Construction in progress 11,467,650 $6,913,321 ($3,731,318) 14,649,653 Total capital assets not being depreciated 39,324,136 6,913,321 (3,731,318) 42,506,139 Capital assets being depreciated:

Buildings & improvements 60,244,828 60,244,828
Right-to-use building 244,821 244,821
Streets & infrastructure 92,758,349 2,617,406 95,375,755 Park structures & improvements 9,677,364 1,113,912 10,791,276 Vehicles & equipment 31,925,437 3,399,901 ($3,865,883) 31,459,455 Furniture & fixtures 458,590 458,590
Subscription assets 5,033,070 1,588,220 (91,019) 6,530,271 Total capital assets being depreciated 200,342,459 4,988,121 (3,956,902) 3,731,318 205,104,996 Less accumulated depreciation for:

Buildings & improvements 40,342,426 1,617,799 41,960,225 Right-to-use building 143,310 71,655 214,965
Streets & infrastructure 68,409,872 1,837,498 70,247,370 Park structures & improvements 5,190,956 420,402 5,611,358 Vehicles & equipment 22,191,653 1,695,933 (4,224,521) 19,663,065 Furniture & fixtures 443,813 2,828 446,641
Subscription assets 796,856 1,194,447 1,991,303
Total accumulated depreciation 137,518,886 6,840,562 (4,224,521) 140,134,927 Net depreciable assets 62,823,573 (1,852,441) 267,619 3,731,318 64,970,069 Governmental activity capital assets, net $102,147,709 $5,060,880 $267,619 $107,476,208

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Balance Balance
June 30, 2023 Additions Retirements June 30, 2024
Business-type activities:

Capital assets not being depreciated:

Land $2,862,549 $2,862,549
Construction in progress 11,752,926 $4,637,763 16,390,689 Total capital assets not being depreciated 14,615,475 4,637,763 19,253,238 Capital assets being depreciated:

Buildings & improvements 7,918,904 7,918,904
Sewage facilities 59,413,041 59,413,041
Mains & subsurface lines 48,439,825 48,439,825
Water reservoirs 12,715,925 12,715,925
Wells & pump stations 9,074,783 9,074,783
Equipment 18,306,827 460,284 18,767,111
Furniture & fixtures 151,328 151,328
Total capital assets being depreciated 156,020,633 460,284 156,480,917 Less accumulated depreciation for:

Buildings & improvements 6,612,807 166,401 6,779,208
Sewage facilities 43,262,191 1,126,680 44,388,871
Mains & subsurface lines 29,209,877 1,591,820 30,801,697 Water reservoirs 6,183,730 159,293 6,343,023
Wells & pump stations 5,078,892 185,664 5,264,556
Equipment 13,906,645 607,063 14,513,708
Furniture & fixtures 116,014 4,533 120,547
Total accumulated depreciation 104,370,156 3,841,454 108,211,610 Net depreciable assets 51,650,477 (3,381,170) 48,269,307 Business-type activity capital assets, net $66,265,952 $1,256,593 $67,522,545 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 contributions 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 programs based on the usage of the related assets.

The amounts allocated to each function or program are as follows:

Governmental Activities
General government $161,111
Public safety 1,113,295
Public works 2,085,955
Culture and recreation 1,537,327
Capital assets held by the City's internal service
funds charged to the various functions based on
their usage of the assets 1,942,874
Total Governmental Activities $6,840,562
Business-Type Activities
Water Utility $1,355,628
Sanitation District 2,295,520
Civic Center 190,306
Total Business-Type Activities $3,841,454
NOTE 5.

LONG-TERM DEBT
Changes in Long-Term Debt for the fiscal year ended June 30, 2024, are as follows:

Original Issue Balance Balance Current
Amount June 30, 2023 Retirements June 30, 2024 Portion
Governmental Activities Debt
2004 Series A-1 Pension Obligation Bonds

2.650%-5.896%, due FY 2024 $36,235,000 $4,325,000 $4,325,000 Community First National Bank Lease-Fire Pumpers

2.670%, due FY 2028 1,483,056 1,086,855 206,069 $880,786 $211,571 Community First National Bank Lease-Fire Engines

3.81%, due FY 2030 1,830,457 1,830,457 215,700 1,614,757 244,619 Total Governmental Activities 7,242,312 4,746,769 2,495,543 456,190 Business-Type Activities Debt
State Water Resources Control Board Loan

2.5%, due FY 2025 (Direct Borrowing) 4,450,128 556,791 556,791 2012 Water Revenue Refunding Bond

2.0%-3.0%, due FY 2024 6,890,000 640,000 640,000
Total Business-Type Activities 1,196,791 1,196,791
Total City Long-Term Debt $8,439,103 $5,943,560 $2,495,543 $456,190 59

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 nonpayment 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 issued. 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. The final payment on the note was made during the year ended June 30, 2024. For fiscal year 2024, principal and interest paid were $4,580,002.

On December 18, 2020, the City entered into a lease financing 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 2028. The lease bears an interest rate of 2.670%. For fiscal year 2024, principal and interest paid were $235,088.

On October 11, 2022, the City entered into a lease financing agreement in the amount of $1,830,457 with Community First National Bank, to acquire two fire engines. 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 January 15, 2024, with annual payments of $306,115 through 2030. The lease bears an interest rate of 3.81%. 60

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. Events 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. The final payment on the note was made during the year ended June 30, 2024. For fiscal year 2024, the final principal and interest paid was $571,865.

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 default. 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 were issued. The final payment on the note was made during the year ended June 30, 2024. For fiscal year 2024, the final principal and interest paid was $652,801.

Annual debt service requirements are shown below for all long-term debt with specified repayment terms:

Fire Apparatus Pumpers Lease Fire Engines Lease
Year ending June 30 Principal Interest Principal Interest Principal Interest 2025 $211,571 $23,517 $244,619 $61,496 $456,190 $85,013 2026 217,220 17,868 253,935 52,180 471,155 70,048
2027 223,020 12,068 263,606 42,509 486,626 54,577
2028 228,975 6,114 273,645 32,470 502,620 38,584
2029 - 2030 578,952 33,279 578,952 33,279
$880,786 $59,567 $1,614,757 $221,934 $2,495,543 $281,501 Governmental Activities
Total
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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, 2024, that amount was $608,439. As of June 30, 2024, the City did not have any outstanding debt applicable to the limit.

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, 2024, the balance of this issuers’ outstanding debt was as follows:

Franciscan Moblie Home Park Acquisition Project:

Senior Revenue Refunding Bonds, Series 2007A and
Subordinate Revenue Refunding Bonds, Series 2007B $41,115,000 Third Tier Revenue Refunding Bonds, Series 2007C 6,865,000 Fourth Tier Revenue Bonds, Series 2002D 541,000
NOTE 6.

CURRENT INTERFUND BALANCES
Current interfund balances arise in the normal course of business and are expected to be repaid shortly after the end of the fiscal year. The purpose of these interfunds was to cover deficit cash in receiving funds. At June 30, 2024, Community Block Grant Special Revenue Fund owed the General Fund $152,110.

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INTERFUND TRANSFERS
Transfers between funds during the fiscal year ended June 30, 2024 were as follows:

Fund Making Transfer Fund Receiving Transfer Transfer Amount General Fund Gas Tax Special Revenue Fund $2,187,284
Grants Special Revenue Fund 5,809
Capital Projects Fund 9,026,736
Non Major Governmental Funds 257,059
Internal Service Fund - Central Services 27,634
Internal Service Fund - Information Services 13,482
Internal Service Fund - Pension UAL Fund 1,000,000
Gas Tax Special Revenue Fund General Fund 304,959
Capital Projects Fund 160,576
Measures A and W Special Revenue Fund Gas Tax Special Revenue Fund 3,463,882 Grants Special Revenue Fund 200
Capital Projects Fund Gas Tax Special Revenue Fund 78,874 Water Utility Enterprise Fund 51,195
Internal Service Fund - Information Services 50,579
Non Major Governmental Funds Capital Projects Fund 62,056 Water Utility Enterprise Fund General Fund 540,649
Sanitation District Enterprise Fund 3,353,309
Sanitation District Enterprise Fund General Fund 1,178,475 Gas Tax Special Revenue Fund 11,305
Civic Center Enterprise Fund General Fund 15,693
Capital Projects Fund 346,123
Non Major Enterprise Fund Water Utility Enterprise Fund 120,309 Internal Service Fund - Motor Vehicles General Fund 484,402 Non Major Governmental Funds 2,223
Internal Service Fund - Central Services General Fund 15,023 Internal Service Fund - PBX General Fund 6,979
Internal Service Fund - Building Maintenance General Fund 376,069 Internal Service Fund - Information Services General Fund 200,499 Internal Service Fund - PBX 3,000
Internal Service Fund - Self-Insurance General Fund 109,486 $23,453,869
The purpose of the majority of transfers is to provide general support to another fund. General Fund transfers out typically represent a subsidy or in the case of grants, a match of another fund’s expenditures.
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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.

NOTE 7.

LEASES
A. POLICIES
A lease is defined as a contract that conveys control of the right to use another entity’s nonfinancial asset (the underlying asset) as specified in the contract for a period of time in an exchange or exchange-like transaction. Examples of nonfinancial assets include buildings, land, vehicles, and equipment. The City recognizes lease receivables or liabilities with an initial, individual value of $25,000 or more.

Lessee - The City is a lessee for a noncancellable lease of office space, as well as the financed purchase discussed in Note 5. The City recognizes a lease liability and an intangible right‐to‐use lease asset (lease asset) in the government‐wide financial statements.

At the commencement of a lease, the City initially measures the lease liability at the present value of payments expected to be made during the lease term. Subsequently, the lease liability is reduced by the principal portion of lease payments made. The lease asset is initially measured as the initial amount of the lease liability, adjusted for lease payments made at or before the lease commencement date, plus certain initial direct costs. Subsequently, the lease asset is amortized on a straight‐line basis over its useful life.

Key estimates and judgments related to leases include how the City determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) lease payments as follows:
• The City uses the interest rate charged by the lessor as the discount rate. When the interest rate charged by the lessor is not provided, the City generally uses its estimated incremental borrowing rate as the discount rate for leases.
• The lease term includes the noncancellable period of the lease. • Lease payments included in the measurement of the lease liability are composed of fixed payments and purchase option price that the City is reasonably certain to exercise.

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

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

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Lessor - The City is a lessor for noncancellable leases of buildings and facilities. The City recognizes a lease receivable and a deferred inflow of resources in the government‐wide and fund financial statements.

At the commencement of a lease, the City initially measures the lease receivable at the present value of payments expected to be received during the lease term. Subsequently, the lease receivable is reduced by the principal portion of lease payments received. The deferred inflow of resources is initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date. Subsequently, the deferred inflow of resources is recognized as revenue over the life of the lease term.

Key estimates and judgments include how the City determines (1) the discount rate it uses to discount the expected lease receipts to present value, (2) lease term, and (3) lease receipts as follows:
• The City uses its estimated incremental borrowing rate as the discount rate for leases. • The lease term includes the noncancellable period of the lease. • Lease receipts included in the measurement of the lease receivable is composed of fixed payments from the lessee.

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

B. LEASES RECEIVABLE
The balances related to leases receivable and deferred inflows of resources as of June 30, 2024 were:

Deferred
Lease Inflows of
Receivable Resources
General Fund
Communication sites $8,575,324 $8,223,628
Civic Center Enterprise Fund
Facilities leases 8,379,917 7,323,703
Total $16,955,241 $15,547,331
Property Easement – The City entered into an easement agreement in December 2020 to facilitate the acquisition of an easement for parking access and utilities. As of June 30, 2024, the lease obligation had been fulfilled and the City recognized $39,837 in lease revenue and $163 in interest revenue during the current fiscal year related to this lease.

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Communication Site Leases – The City leases various locations to third parties for the provisions of mobile/wireless communications services. During the year ended June 30, 2024, the City had ten leases, with original lease terms ranging from five to fifty-five years, including the optional extension periods, and as of June 30, 2024, the leases had 1 to 48 years remaining. The City recognized $416,355 in lease revenue and $172,366 in interest revenue during the current fiscal year related to these leases. Also, the City has deferred inflows of resources associated with these leases that will be recognized as revenue over the lease term.

Facilities Leases – The City leases various facilities to third parties. During the year ended June 30, 2024, the City had four leases, with original lease terms ranging from three to twelve years and as of June 30, 2024, the leases had 1 to 13.5 years remaining. The City recognized $842,261 in lease revenue and $427,120 in interest revenue during the current fiscal year related to these leases. Also, the City has deferred inflows of resources associated with these leases that will be recognized as revenue over the lease term.

C. LEASE PAYABLE
A summary of governmental activities lease transactions for the fiscal year ended June 30, 2024, are as follows:

Balance Balance Current
June 30, 2023 Retirements June 30, 2024 Portion
Governmental Activities
Lease Payable
MKD Cedar Hill $113,351 ($78,888) $34,463 $34,463
Building Lease – The City entered into a five year lease agreement with MKD Cedar Hill as lessee for the use of office space that commenced in November 2017. An initial lease liability was recorded in the amount of $98,554 during fiscal year 2023, but the lease term was extended two years during fiscal year 2023 and the lease liability increased by $146,267. As of June 30, 2024, the value of the lease liability was $34,463. The City is required to make monthly principal and interest payments of $6,978.

The lease bears the City’s incremental borrowing rate of 4.92%. At June 30, 2024 the value of the right-to-use asset was $244,821 and the accumulated amortization balance was $214,965.

The future principal and interest lease payments as of June 30, 2024, were as follows:

Balance Balance Current
June 30, 2023 Retirements June 30, 2024 Portion
Governmental Activities
Lease Payable
MKD Cedar Hill $113,351 ($78,888) $34,463 $34,463
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NOTE 8.

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 multipleemployer defined benefit pension plans administered by the California Public Employees’ Retirement System (CalPERS), which acts as a common investment 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 retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living adjustments for 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, 2024, are summarized as follows:

Miscellaneous
Hire date
Prior to
January 1, 2013
On or after
January 1, 2013
Benefit formula 3% @ 60 2% @ 62
Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50-60 52-67
Monthly benefits, as a % of eligible compensation 2.0%-3.0% 1.0%-2.5% Required employee contribution rates 8.00% 8.00%
Required employer contribution rates 12.54% * 12.54% *
Required Unfunded Accrued Liability Contribution $6,399,255 *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
Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50-55 50-57
Monthly benefits, as a % of eligible compensation 2.4%-3.0% 2.0%-2.7% Required employee contribution rates 9.00% 11.50%
Required employer contribution rates 18.64% 18.64%
Required Unfunded Accrued Liability Contribution $9,217,388 *Effective July 11, 2020, members in the Daly City Police Officers Association and Daly City Police Management 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, 2024 were $6,399,255 and $9,217,388, respectively, which were made under the lumpsum 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, 2022 and measurement date of June 30, 2023:

Miscellaneous Safety
Inactive employees or beneficiaries currently receiving benefits 559 355 Inactive employees entitled to but not yet receiving benefits 412 101 Active employees 293 164
Total 1,264 620
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 amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employer contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan member contribution requirements are classified as plan member contributions.

The City’s Contributions to the Plans for the year ended June 30, 2024 were $10,044,439 for the Miscellaneous Plan and $13,971,850 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, 2023, using an annual actuarial valuation as of June 30, 2022, rolled forward to June 30, 2023 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, 2022 actuarial valuations were determined using the following actuarial assumptions:

Valuation Date June 30, 2022
Measurement Date June 30, 2023
Actuarial Cost Method Entry-Age Normal Cost Method
Actuarial Assumptions:

Discount Rate 6.90%
Inflation 2.30%
Payroll Growth 2.80%
Projected Salary Increase Varies by Entry Age and Service Investment Rate of Return 6.90% (1)
Mortality Derived using CalPERS Membership Data for all Funds (2) Post Retirement Benefit Increase
The lesser of contract COLA or 2.30% until Purchasing
Protection Allowance floor on purchasing power applies,

2.30% thereafter
(1) Net of pension plan investment expenses, including inflation (2) The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2021 CalPERS Experience Study and Review of Actuarial Assumptions.

Mortality rates incorporate full generational mortality improvement using 80% of Scale MP-2020 published by the Society of Actuaries. For more details on this table, please refer to the 2021 experience study report from November 2021 that can be found on the CalPERS website.

The underlying mortality assumptions and all other actuarial assumptions used in the June 30, 2022 valuation were based on the results of a November 2021 actuarial experience study for the period 2001 to 2019. 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 6.90%.

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 determined. 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 buildingblock method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.

In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectations. Using historical returns of all the funds’ asset classes, expected compound (geometric) returns were calculated over the next 20 years using a building-block approach.

The expected rate of return was then adjusted to account for assumed administrative expenses of 10 basis points.
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The expected real rates of return by asset class are as follows:

Asset Class (a)
Assumed
Asset
Allocation
Real return
(a) (b)
Global Equity - Cap-weighted 30.00% 4.54%
Global Equity - Non-cap-weighted 12.00 3.84
Private Equity 13.00 7.28
Treasury 5.00 0.27
Mortgage-backed Securities 5.00 0.50
Investment Grade Corporates 10.00 1.56
High Yield 5.00 2.27
Emerging Market Debt 5.00 2.48
Private Debt 5.00 3.57
Real Assets 15.00 3.21
Leverage (5.00) (0.59)
(a) An expected inflation of 2.30% used for this period. (b) Figures are based on the 2021 Asset Liability
Management study.

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C. CHANGES IN THE NET PENSION LIABILITY
The changes in the Net Pension Liability for each Plan follow:

Miscellaneous Plan:

Increase (Decrease)
Total Pension
Liability
Plan Fiduciary
Net Position
Net Pension
Liability/(Asset)
Balance at June 30, 2022 (Measurement Date) $371,961,919 $288,776,693 $83,185,226 Changes in the year:

Service cost 5,746,715 5,746,715
Interest on the total pension liability 25,648,026 25,648,026 Changes of Benefit Terms 342,121 342,121
Differences between actual and expected experience 7,085,412 7,085,412 Contributions - employer 10,858,504 (10,858,504)
Contributions - employees 2,436,595 (2,436,595)
Net investment income 17,779,219 (17,779,219)
Benefit payments, including refunds of employee
contributions (21,104,564) (21,104,564)
Administrative Expense (212,353) 212,353
Net changes 17,717,710 9,757,401 7,960,309
Balance at June 30, 2023 (Measurement Date) $389,679,629 $298,534,094 $91,145,535 Safety Plan:

Increase (Decrease)
Total Pension
Liability
Plan Fiduciary
Net Position
Net Pension
Liability/(Asset)
Balance at June 30, 2022 (Measurement Date) $402,117,166 $272,257,503 $129,859,663 Changes in the year:

Service cost 7,095,262 7,095,262
Interest on the total pension liability 27,591,409 27,591,409 Changes of Benefit Terms 189,498 189,498
Differences between actual and expected experience 5,496,999 5,496,999 Contributions - employer 13,581,977 (13,581,977)
Contributions - employees 3,130,330 (3,130,330)
Net investment income 16,771,986 (16,771,986)
Benefit payments, including refunds of employee
contributions (22,951,582) (22,951,582)
Administrative Expense (200,205) 200,205
Net changes 17,421,586 10,332,506 7,089,080
Balance at June 30, 2023 (Measurement Date) $419,538,752 $282,590,009 $136,948,743 TOTAL - BOTH PLANS $809,218,381 $581,124,103 $228,094,278 72

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, calculated 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 5.90% 5.90%
Net Pension Liability $141,239,746 $190,027,174 $331,266,920 Current Discount Rate 6.90% 6.90%
Net Pension Liability $91,145,535 $136,948,743 $228,094,278 1% Increase 7.90% 7.90%
Net Pension Liability $49,646,626 $92,965,344 $142,611,970 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 deferred 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, 2024 the City recognized pension expense of $17,413,254 for the Miscellaneous Plan and $22,478,361 for the Safety Plan, for total pension expense of $39,891,615. At June 30, 2024, 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 $9,984,439 Differences between actual and expected experience 4,133,157 ($44,194) Changes in assumptions 699,579
Net differences between projected and actual earnings on plan investments 13,683,294
Total $28,500,469 ($44,194)
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Safety Plan:

Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contributions subsequent to measurement date $13,971,850 Differences between actual and expected experience 4,688,187 Changes in assumptions 3,590,354
Net differences between projected and actual earnings on plan investments 12,942,359
Total $35,192,750
Total Miscellaneous and Safety Plans $63,693,219 ($44,194) The amount of $23,956,289 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, 2025. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:

Year Ended
June 30 Miscellaneous Plan Safety Plan Total
2025 $6,037,633 $7,533,494 $13,571,127
2026 2,508,691 3,552,831 6,061,522
2027 9,554,998 9,778,144 19,333,142
2028 370,514 356,431 726,945
Annual Amortization
NOTE 9.

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 who 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 Health 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 Trust (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.

For employees hired prior to February 1, 2023, 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.

For employees hired on or after February 1, 2023, the City contributes the PEHMCA minimum, which was $157 in 2024.
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As of the June 30, 2023 measurement date, approximately 508 retirees were eligible and were receiving retiree health care benefits from the City and approximately 40 inactive employees entitled to but not yet receiving benefit payments. There were approximately 448 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, 2024, the City contributed $4,451,839 to the Plan, which was comprised of benefit premiums of $2,490,415, prefunding contributions of $1,000,000, administrative expenses of $28,424 and implied subsidy benefit payments of $933,000.

A. FUNDING POLICY AND ACTUARIAL ASSUMPTIONS
The total OPEB liability was determined as part of a June 30, 2023 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 2.50% inflation rate, 6.25% investment rate of return, 2.75% projected annual salary increase, and a medical trend of 8.50% (Non-Medicare), 7.50% (Medicare-Non-Kaiser) and 6.25% (Medicare-Kaiser) in 2025 decreasing to an ultimate rate of 3.45% 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.

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, 2023 and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation dated June 30, 2023.

The long-term expected rate of return on OPEB plan investments was determined using a building-block method in which expected future real rates of return (expected returns, 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 Expected Real
Asset Class Allocation Rate of Return
Global Equity 49% 4.56%
Fixed Income 23% 1.56%
TIPS 5% -0.08%
Commodities 3% 1.22%
REITs 20% 4.06%
Assumed Long-Term Rate of Inflation 100% 2.50%
Expected Long-Term Net Rate of Return 6.25%
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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 assumed 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.

Changes of Assumptions – For the measurement date of June 30, 2023, the discount rate increased from 5.75% to 6.25%. In addition, the City updated Medical trend percentages from 6.50% to 8.50% for Non-Medicare, 3.45% to 7.50% for Medicare (Non-Kaiser), and 3.45% to 6.25% for Medicare (Kaiser).

C. CHANGES IN NET OPEB LIABILITY
The changes in the net OPEB liability follows:

Total OPEB Plan Fiduciary Net OPEB
Liability Net Position Liability/(Asset)
(a) (b) (a) - (b)
Balance at June 30, 2023 $57,596,278 $18,242,167 $39,354,111 Changes Recognized for the Measurement Period:

Service Cost 1,408,527 1,408,527
Interest on the total OPEB liability 3,294,815 3,294,815 Changes in benefit terms 0
Differences between expected and actual experience (3,914,772) (3,914,772) Changes of assumptions (2,156,493) (2,156,493)
Contributions from the employer 4,407,335 (4,407,335)
Net investment income 945,683 (945,683)
Administrative expenses (5,244) 5,244
Benefit payments (3,407,335) (3,407,335) 0
Net changes (4,775,258) 1,940,439 (6,715,697)
Balance at June 30, 2024 (June 30, 2023 Measurement Date) $52,821,020 $20,182,606 $32,638,414 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 implied subsidy benefit payments in the amount of $902,000.

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-percentagepoint 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%)
$38,414,426 $32,638,414 $27,734,707

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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 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
$30,456,377 $32,638,414 $35,428,010
E. OPEB EXPENSE AND DEFERRED OUTFLOWS/INFLOWS OF RESOURCES RELATED

TO OPEB
For the year ended June 30, 2024, the City recognized OPEB expense of $1,508,049. At June 30, 2024, the City reported deferred outflows and inflows of resources related to OPEB from the following sources:

Deferred Outflows Deferred Inflows
of Resources of Resources
$4,451,839
Difference between expected and actual experience ($4,044,545) Changes in assumptions 264,160 (3,029,072)
Net differences between projected and actual earnings on plan investments 1,448,651
Total $6,164,650 ($7,073,617)
Employer contributions made subsequent to the measurement date $4,451,839 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, 2025. 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
2025 ($1,592,403)
2026 (1,157,069)
2027 (653,706)
2028 (1,212,033)
2029 (745,595)
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NOTE 10.

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 Plan is part of the public agency agent multiple-employer defined contribution plan that is administered by CalPERS. Benefit provisions under the Plan are established by City Resolution.

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.

The City has no liability for any losses incurred by the Plan and does not participate in any gains, but does have the duty of due care that would be required of an ordinary prudent investor. The City has a contract with Mission Square to manage and invest the assets of the Plan. The administrator pools the assets of the Plan with those of other participants and does not make separate investments for the City. The assets in the Plan are the sole property of the participants or their beneficiaries. Since the assets held under the Plan are not the City’s property and are not subject to claims by general creditors of the City, they have been excluded from these financial statements. The Plan requires investments to be stated at fair market value and it requires all gains and losses on Plan investments to accrue directly to participant accounts.

The City adopted a Resolution in November 2020 that required a monthly deferred compensation contribution of $1,000 for the City Manager. Effective January 2023, the City’s required monthly deferred compensation contribution was reduced to $500. In August 2022, the City Council approved a one-time payment of vacation accruals in the amount of $17,250 toward the City Manager’s deferred compensation account. In addition, the City adopted a Resolution in November 2023 that required a monthly deferred compensation contribution of $500 for the City Attorney. The City does not make any other contributions to the Plan. The City’s required contributions for the year ended June 30, 2024 totaled $10,000.
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NOTE 11.

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 programs. 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 excess 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 $500,000 of general and automobile liability claims and maintains a $50,000 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. The City also has a law enforcement liability policy with a deductible of $350,000 and coverage of up to $5 million per occurrence. 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, 2024, the City contributed $747,545 to PRISM for 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, 2024 and 2023:
2024 2023
Beginning balance of claims payable $10,073,000 $10,487,000 Increase in estimated claims liability 3,906,938 2,336,204 Claims paid (3,195,938) (2,750,204)
Ending balance of claims payable $10,784,000 $10,073,000 Current Portion $2,928,869 $2,622,041
The undiscounted claims totaled $11,883,000 at June 30, 2024.

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NOTE 12.

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 Position 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 accordance 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.

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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, 2024, are below:

Other
General Gas Measures Capital Governmental
Fund Balance Classifications Fund Tax Grants A and W Projects Funds Total Nonspendables:

Items not in spendable form:

Inventories $18,888 $21,196 $40,084
Petty cash 8,357 8,357
Prepaids 37,550 $81,066 118,616
Leases receivable 351,696 351,696
Loan receivable from
Successor Agency 9,621,859 9,621,859
Total Nonspendable 10,038,350 21,196 81,066 10,140,612
Restricted for:

Pension benefits 4,767,252 4,767,252
Gas Tax Projects 8,536,041 8,536,041
Capital Projects 1,000,000 $12,690,391 $12,945,510 26,635,901 Affordable Housing $5,395,775 5,395,775
Low and Moderate Income
Housing Assets 4,312,738 4,312,738
654,506 654,506
Traffic Safety 126,128 126,128
Grants 494,376 494,376
Total Restricted 5,767,252 8,536,041 494,376 12,690,391 12,945,510 10,489,147 50,922,717 Assigned to:

Capital Projects 23,865,564 23,865,564
Other Contracts 611,754 611,754
Total Assigned 611,754 23,865,564 24,477,318
Unassigned:

Contingency Fund 1,000,000 1,000,000
Operating Reserve 20,100,000 20,100,000
Unassigned 39,408,117 39,408,117
Total Unassigned 60,508,117 60,508,117
Total Fund Balances $76,925,473 $8,557,237 $575,442 $12,690,391 $36,811,074 $10,489,147 $146,048,764 Linda Vista Benefit Assessment
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C. MINIMUM FUND BALANCE POLICY
The City Council adopted a General Fund Reserve Policy in July 2020 to establish target reserve levels and the methodology for calculating reserve levels. 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, 2024 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 $20.1 million at June 30, 2024 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. NET POSITION RESTRICTED FOR QUALIFIED CAPITAL OUTLAY The City established a Reserve for Qualified Capital Outlay in the Sanitation District Enterprise Fund and transferred into it amounts from fiscal years 2019 to 2024 necessary to ensure compliance with State Gann Limit provisions. These funds will be used solely to pay for Gann Limit excludable capital expenses. To qualify, they must be for assets with a value greater than $100,000 and a useful life of at least 10 years.

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NOTE 13.

LOANS AND NOTES RECEIVABLE
Housing Rehabilitation Program - 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 unavailable revenue as they are not expected to be repaid during the next fiscal year.

During fiscal year 2024, the City made loans to three participants under this program and the CDBG and Cal HOME loan program activity is as follows:

Beginning Balance $1,390,489
Loan repayments (99,135)
Loans forgiven (28,267)
Ending Balance $1,263,087
NOTE 14.

SUBSCRIPTION-BASED INFORMATION TECHNOLOGY ARRANGEMENTS
A. POLICIES
A subscription-based information technology arrangement (SBITA) is a contract that conveys control of the right to use another party’s (a SBITA vendor’s) IT software, alone or in combination with tangible capital assets (the underlying IT assets), as specified in the contract for a period of time in an exchange or exchange-like transaction.

At the commencement of a SBITA, the City initially measures the subscription liability at the present value of payments expected to be made during the contract term. Subsequently, the subscription liability is reduced by the principal portion of payments made. The subscription asset is initially measured as the initial amount of the subscription liability, adjusted for payments made at or before the SBITA commencement date, plus certain initial direct costs. Subsequently, the subscription asset is amortized on a straight‐line basis over shorter of the subscription term or the useful life of the underlying IT assets. The City recognizes subscription assets with an initial, individual value of $25,000 or more.

Key estimates and judgments related to SBITAs include how the City determines (1) the discount rate it uses to discount the expected subscription payments to present value, (2) subscription term, and (3) subscription payments as follows:
• The City uses the interest rate charged by the IT vendor as the discount rate. When the interest rate charged by the IT vendor is not provided, the City generally uses its estimated incremental borrowing rate as the discount rate for subscription liabilities. • The subscription term includes the noncancellable period of the subscription. 83

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

Subscription assets are reported with other capital assets and subscription liabilities are reported on the statement of net position.

B. SUBSCRIPTION LIABILITIES
A summary of the City’s SBITA transaction activities for the fiscal year ended June 30, 2024, are as follows:

Balance Balance Current
June 30, 2023 Additions Retirements June 30, 2024 Portion Governmental Activities
Subscription Liabilities
Axon Enterprises $2,342,714 $321,020 $423,171 $2,240,563 $357,660 Tyler Technologies 466,000 165,246 300,754 74,569
Microsoft Enterprise Enrollment 1,109,824 219,936 889,888 220,946 Superion 364,884 364,884 187,330
Flock Safety 1,145,600 337,939 807,661 237,292
Total Subscription Liabilities $4,283,422 $1,466,620 $1,146,292 $4,603,750 $1,077,797 In May 2021, the City entered into a five‐year SBITA for the use of body-worn camera-related cloud services. The agreement automatically renews for an additional five years, but the vendor may increase the cost of services by up to 3% per year during the renewal period. An initial subscription liability was recorded in the amount of $2,613,259 as of July 1, 2022. During fiscal year 2024, the City entered into an additional 3 year agreement with 3 other services for car camera systems, camera drones and additional body-worn camera services for an additional SBITA liability of $321,020. As of June 30, 2024, the balance of the subscription liability was $2,240,563. The software has a useful life of three to nine years. The City is required to make annual principal and interest payments of $13,400 to $327,547 on the subscriptions. The value of the right‐to‐use assets as of the end of the current fiscal year was $2,934,278 and had accumulated amortization of $697,548.

In August 2020, and amended in November 2021, the City entered into a five‐year SBITA for the use of community development and cashiering software. Due to a delay in the implementation, the amendment revised the commencement date of the agreement to November 1, 2021. The agreement automatically renews for one year, at the vendor’s current service rate. An initial subscription liability was recorded in the amount of $557,927 as of July 1, 2022. During fiscal year 2024, the City modified the agreement for the software and therefore, retired the subscription asset and liability by $91,018, and the accumulated amortization on the right-to-use asset by $17,065. As of June 30, 2024, the balance of the subscription liability was $300,754. The City is required to make annual principal and interest payments of $75,948. The software has a six‐year estimated useful life. The value of the right‐to‐use asset as of the end of the current fiscal year was $466,909 and accumulated amortization was $175,091.

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In December 2022, the City entered into a three‐year SBITA for the use of Microsoft Enterprise cloud services. The agreement can be renewed for an additional three year term. An initial subscription liability was recorded in the amount of $1,328,754 during fiscal year 2023. As of June 30, 2024, the balance of the subscription liability was $889,888. The City is required to make annual principal and interest payments of $225,032. The software has a six‐year estimated useful life. The value of the right‐to‐use asset as of the end of the current fiscal year was $1,328,754 and had accumulated amortization of $442,918.

In May 2020, the City entered into a one‐year SBITA for the use of finance enterprise software. The agreement automatically renews for successive one year terms. An initial subscription liability was recorded in the amount of $533,130 as of July 1, 2022. As of June 30, 2024, the balance of the subscription liability was $364,884. The City is required to make annual principal and interest payments of $170,694 to $188,190. During fiscal year 2024, the vendor for the software modified the City’s payment schedule and the City was not required to make the payment of $170,694. The software has a three‐year estimated useful life. The value of the right‐to‐use asset as of the end of the current fiscal year was $533,130 and had accumulated amortization of $355,420.

In December 2023, the City entered into a three-year SBITA for the use of cameras and software. The agreement can be renewed for an additional two year term. An initial subscription liability was recorded in the amount of $1,145,600 during fiscal year 2024. As of June 30, 2024, the balance of the subscription liability was $807,661. The City is required to make annual principal and interest payments ranging from $109,950 to $233,250 on the subscription. The software has a five-year estimated useful life. The value of the right-to-use asset as of the end of the current fiscal year was $1,145,600 and had accumulated amortization of $279,793.

The future principal and interest subscription liability payments as of June 30, 2024, were as follows:

For the Year
Ended June 30 Principal Interest Total
2025 $1,077,797 $20,657 $1,098,454
2026 1,112,107 15,625 1,127,732
2027 727,918 11,251 739,169
2028 740,412 7,825 748,237
2029 304,403 4,341 308,744
Thereafter 641,113 4,441 645,554
Totals $4,603,750 $64,140 $4,667,890

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NOTE 15.

ACTIVITIES OF THE SUCCESSOR AGENCY TO THE FORMER REDEVELOPMENT AGENCY The activities of the Successor Agency are reported 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 Successor Agency to wind down the affairs of the former Redevelopment Agency.

Information presented in the following footnotes represents assets and liabilities of the Successor Agency.

A. CASH
Cash and investments of the Successor Agency as of June 30, 2024 are discussed in Note 1G above.

Information presented in the following footnotes represents other assets and liabilities of the Successor Agency as of June 30, 2024.

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 balance as it cannot be appropriated against until funds are received from the State. The balance of the loans as of June 30, 2024 is $9,621,859.

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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 position, 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 position, net OPEB liability, a ratio of plan net position divided by the total OPEB liability, the payroll amount for current employees in the plan (coveredemployee 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. 87

SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS As of fiscal year ending June 30, 2024
Last 10 Years

SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS

MISCELLANEOUS
Measurement Period 2013-2014 2014-2015 2015-2016 2016-2017 2017-2018 2018-2019 2019-2020 2020-2021 2021-2022 2022-2023 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 $4,750,071 $5,243,267 $5,746,715 Interest 19,456,167 20,028,375 20,453,457 21,126,222 21,405,533 22,557,657 23,372,961 24,305,480 24,450,276 25,648,026 Differences between expected and actual experience (5,096,599) (6,329,013) (1,376,656) 1,006,212 5,081,458 432,569 2,730,394 (265,160) 7,085,412 Changes in assumptions (4,888,600) 17,607,198 (9,036,830) 4,197,477 Changes in benefits 342,121
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) (18,715,236) (18,923,625) (21,104,564) Net change in total pension liability 13,079,916 2,264,041 5,618,086 28,707,507 3,645,862 16,621,431 11,648,451 13,070,709 14,702,235 17,717,710 Total pension liability - beginning 262,603,681 275,683,597 277,947,638 283,565,724 312,273,231 315,919,093 332,540,524 344,188,975 357,259,684 371,961,919 Total pension liability - ending (a) $275,683,597 $277,947,638 $283,565,724 $312,273,231 $315,919,093 $332,540,524 $344,188,975 $357,259,684 $371,961,919 $389,679,629 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 $8,924,993 $9,832,902 $10,858,504 Contributions - employee 2,090,754 1,959,273 2,019,542 2,110,207 2,068,466 2,144,408 2,252,506 2,129,297 2,255,948 2,436,595 Net investment income 34,374,839 5,074,277 1,142,662 24,378,978 19,945,939 16,443,055 12,936,801 59,983,132 (24,109,678) 17,779,219 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) (18,715,236) (18,923,625) (21,104,564) Other miscellaneous income (expense) (708,784) 585
Administrative Expense (255,289) (138,235) (326,924) (373,237) (179,872) (368,964) (267,582) (199,291) (212,353) Net 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 52,054,604 (31,143,744) 9,757,401 Plan fiduciary net position - beginning 199,423,445 228,445,077 226,820,602 221,428,349 239,519,536 252,054,998 261,721,857 267,865,833 319,920,437 288,776,693 Plan fiduciary net position - ending (b) $228,445,077 $226,820,602 $221,428,349 $239,519,536 $252,054,998 $261,721,857 $267,865,833 $319,920,437 $288,776,693 $298,534,094 Net pension liability - ending (a)-(b) $47,238,520 $51,127,036 $62,137,375 $72,753,695 $63,864,095 $70,818,667 $76,323,142 $37,339,247 $83,185,226 $91,145,535 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% 89.55% 77.64% 76.61% Covered payroll $24,443,972 $22,658,681 $22,823,982 $23,568,915 $22,688,822 $24,144,928 $24,817,517 $24,973,064 $27,629,117 $28,935,160 Net pension liability as percentage of covered payroll 193.25% 225.64% 272.25% 308.68% 281.48% 293.31% 307.54% 149.52% 301.08% 315.00% Notes to Schedule:

Fiscal year 2015 was the 1st year of implementation.

Source: CalPERS Accounting Valuation
Changes in assumptions. There were no assumption changes in 2023. Effective with the June 30, 2021 valuation date (June 30, 2022 measurement date), the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. In addition, demographic assumptions and the price inflation assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The accounting discount rate was 7.15% for measurement dates June 30, 2017 through June 30, 2021, 7.65% for measurement dates June 30, 2015 through June 30, 2016, and 7.50% for measurement date June 30, 2014.

Benefit changes. The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date. However, offers of Two Years Additional Service Credit (a.k.a.

Golden Handshakes) that occurred after the Valuation Date are not included in the figures above, unless the liability is deemed to be material by the plan actuary.
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SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS As of fiscal year ending June 30, 2024
Last 10 Years

SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS SAFETY
Measurement Period 2013-2014 2014-2015 2015-2016 2016-2017 2017-2018 2018-2019 2019-2020 2020-2021 2021-2022 2022-2023 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 $5,977,808 $6,709,103 $7,095,262 Interest 19,532,405 20,368,130 21,118,384 21,794,377 22,455,535 23,732,977 24,739,728 25,785,538 26,435,472 27,591,409 Differences between expected and actual experience (455,068) (1,021,524) 293,934 (978,042) 7,441,738 3,245,246 3,789,911 1,705,342 5,496,999 Changes in assumptions (4,770,631) 17,425,044 (632,875) 9,574,276 Changes in benefits 189,498
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) (20,254,165) (21,591,268) (22,951,582) 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 15,299,092 22,832,925 17,421,586 Total pension liability - beginning 275,975,394 264,421,131 282,118,539 292,136,007 321,572,305 330,621,022 349,529,705 363,985,149 379,284,241 402,117,166 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 $379,284,241 $402,117,166 $419,538,752 Plan fiduciary net position
Contributions - employer $4,225,009 $4,630,110 $5,309,673 $6,087,507 $6,986,096 $8,259,177 $9,741,720 $10,622,105 $12,262,596 $13,581,977 Contributions - employee 2,632,654 1,864,455 1,917,899 1,935,079 2,062,297 2,040,072 2,186,070 2,777,982 3,050,038 3,130,330 Net investment income 33,622,839 4,997,920 1,208,758 23,497,877 18,994,354 15,591,708 12,209,629 56,328,465 (22,624,777) 16,771,986 Benefit payments, including refunds of employee
contributions (13,776,270) (12,996,278) (14,939,167) (15,643,224) (17,110,200) (17,828,231) (19,366,927) (20,254,165) (21,591,268) (22,951,582) Administrative Expense (134,719) (249,064) (316,566) (358,363) (171,174) (349,203) (251,859) (187,722) (200,205) Other Miscellaneous Expense 556 (680,537)
Plan to Plan Resource Management 341 493 (556) (54,276) Net change in plan fiduciary net position (2,532,356) 27,484,224 (6,637,556) 15,561,014 9,893,091 7,837,832 4,421,289 49,222,528 (29,091,133) 10,332,506 Plan fiduciary net position - beginning 196,098,570 223,582,794 221,050,438 214,412,882 229,973,896 239,866,987 247,704,819 252,126,108 301,348,636 272,257,503 Plan fiduciary net position - ending (b) $223,582,794 $221,050,438 $214,412,882 $229,973,896 $239,866,987 $247,704,819 $252,126,108 $301,348,636 $272,257,503 $282,590,009 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 $77,935,605 $129,859,663 $136,948,743 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% 79.45% 67.71% 67.36% Covered payroll $19,652,763 $19,567,377 $19,784,134 $19,829,558 $20,477,192 $21,410,816 $22,001,988 $23,722,063 $26,760,075 $26,939,202 Net pension liability as percentage of covered payroll 266.59% 312.09% 392.86% 461.93% 443.20% 475.58% 508.40% 328.54% 485.27% 508.36% Notes to Schedule:

Fiscal year 2015 was the 1st year of implementation.

Source: CalPERS Accounting Valuation
Changes in assumptions. There were no assumption changes in 2023. Effective with the June 30, 2021 valuation date (June 30, 2022 measurement date), the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. In addition, demographic assumptions and the price inflation assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The accounting discount rate was 7.15% for measurement dates June 30, 2017 through June 30, 2021, 7.65% for measurement dates June 30, 2015 through June 30, 2016, and 7.50% for measurement date June 30, 2014.

Benefit changes. The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date. However, offers of Two Years Additional Service Credit (a.k.a.

Golden Handshakes) that occurred after the Valuation Date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary.

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MISCELLANEOUS
Fiscal Year Ended June 30 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Actuarially determined contribution $4,637,116 $6,771,305 $5,540,220 $6,146,305 $7,064,967 $8,236,678 $8,901,914 $9,382,915 $10,858,503 $9,984,439 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) (9,382,915) (10,858,503) (9,984,439) Contribution deficiency (excess)
Covered payroll $22,658,681 $22,823,982 $23,568,915 $22,688,822 $24,144,928 $24,817,517 $24,973,064 $27,629,117 $28,935,160 $30,675,866 Contributions as a percentage of covered payroll 20.47% 29.67% 23.51% 27.09% 29.26% 33.19% 35.65% 33.96% 37.53% 32.55% 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 6/30/2019 6/30/2020 6/30/2021

SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS As of fiscal year ending June 30, 2024
Last 10 Years

SCHEDULE OF CONTRIBUTIONS
SAFETY
Fiscal Year Ended June 30 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Actuarially determined contribution $4,225,009 $5,309,673 $6,090,350 $6,985,429 $8,263,084 $9,742,714 $10,620,215 $12,263,576 $13,351,978 $13,971,850 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) (12,263,576) (13,351,978) (13,971,850) 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 $26,760,075 $26,939,202 $28,111,477 `
Contributions as a percentage of covered payroll 21.59% 26.84% 30.71% 34.11% 38.59% 44.28% 44.77% 45.83% 49.56% 49.70% 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 6/30/2019 6/30/2020 6/30/2021

SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS As of fiscal year ending June 30, 2024
Last 10 Years

SCHEDULE OF CONTRIBUTIONS
90

City of Daly City, Agent Multiple-Employer Defined Benefit OPEB Plan As of fiscal year ending June 30, 2024
Last 10 Years*

SCHEDULE OF CHANGES IN THE NET OPEB LIABILITY AND RELATED RATIOS Measurement Date Ended June 30 2017 2018 2019 2020 2021 2022 2023 Total OPEB Liability
Service Cost $1,470,697 $1,514,818 $1,560,263 $1,455,663 $1,480,458 $1,443,352 $1,408,527 Interest 3,449,729 3,567,790 3,690,181 3,500,744 3,541,517 3,174,237 3,294,815 Changes in benefit terms - - - - - - -
Differences between expected and actual experience - - (4,588,272) - (1,048,749) - (3,914,772) Changes of assumptions - - (281,571) (865,013) 581,149 (1,564,568) (2,156,493) Benefit payments (2,980,461) (3,170,657) (3,168,930) (3,445,074) (3,482,594) (3,453,620) (3,407,335) Net change in total OPEB liability 1,939,965 1,911,951 (2,788,329) 646,320 1,071,781 (400,599) (4,775,258) Total OPEB liability - beginning 55,215,189 57,155,154 59,067,105 56,278,776 56,925,096 57,996,877 57,596,278 Total OPEB liability - ending (a) $57,155,154 $59,067,105 $56,278,776 $56,925,096 $57,996,877 $57,596,278 $52,821,020 Plan fiduciary net position
Contributions - employer $5,980,461 $4,170,657 $3,168,930 $5,445,074 $5,482,594 $4,453,620 $4,407,335 Contributions - employee - - - - - - -
Net investment income 557,870 604,302 799,047 653,960 2,914,658 (2,477,143) 945,683 Administrative expense (4,247) (18,096) (2,447) (6,040) (5,425) (4,993) (5,244) Benefit payments (2,980,461) (3,170,657) (3,168,930) (3,445,074) (3,482,594) (3,453,620) (3,407,335) Net change in plan fiduciary net position 3,553,623 1,586,206 796,600 2,647,920 4,909,233 (1,482,136) 1,940,439 Plan fiduciary net position - beginning 6,230,721 9,784,344 11,370,550 12,167,150 14,815,070 19,724,303 18,242,167 Plan fiduciary net position - ending (b) $9,784,344 $11,370,550 $12,167,150 $14,815,070 $19,724,303 $18,242,167 $20,182,606 Net OPEB liability - ending (a)-(b) $47,370,810 $47,696,555 $44,111,626 $42,110,026 $38,272,574 $39,354,111 $32,638,414 Plan fiduciary net position as a percentage of the total OPEB liability 17.12% 19.25% 21.62% 26.03% 34.01% 31.67% 38.21% Covered-employee payroll $50,082,473 $49,471,054 $50,975,693 $51,740,099 $54,458,885 $63,519,016 $63,958,980 Net OPEB liability as a percentage of covered-employee payroll 94.59% 96.41% 86.53% 81.39% 70.28% 61.96% 51.03% * Fiscal year 2018 was the first year of implementation.

91

Fiscal Year Ended June 30, 2024 2023 2022 2021 2020 2019 2018 Actuarially determined contributions $4,564,000 $4,441,000 $5,021,000 $4,873,000 $5,264,000 $5,109,000 $4,185,306 Contractually required contributions (a)
Contributions in relation to the
contractually required or actuarially
determined contributions (4,451,839) (4,407,335) (4,453,620) (5,482,594) (5,445,074) (3,168,930) (4,185,306) Contribution deficiency (excess) $112,161 $33,665 $567,380 ($609,594) ($181,074) $1,940,070 $0 Covered-employee payroll $67,354,959 $63,958,980 $63,519,016 $54,458,885 $51,740,099 $50,975,693 $49,471,054 Contributions as a percentage of
covered-employee payroll 6.61% 6.89% 7.01% 10.07% 10.52% 6.22% 6.22% * Fiscal year 2018 was the first year of implementation. (a) The City did not obtain an actuarially determined contribution calculation in fiscal year 2018, therefore the contractually required contributions were reported.

City of Daly City, Agent Multiple-Employer Defined Benefit OPEB Plan As of fiscal year ending June 30, 2024
Last 10 Years*

SCHEDULE OF CONTRIBUTIONS
92

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.
93

CITY OF DALY CITY

GENERAL FUND

COMBINING FUND BALANCE SHEET
JUNE 30, 2024
Special Traffic Total
General Deposits Enforcement General Fund
ASSETS
Cash and investments $56,646,533 $13,232,518 $688,381 $70,567,432 Restricted cash and investments 4,767,252 4,767,252
Accounts receivable, net 12,044,716 224,296 715 12,269,727 Due from other funds 152,110 152,110
Prepaids 37,550 37,550
Inventories 18,888 18,888
Loan receivable from Successor Agency 9,621,859 9,621,859 Leases receivable 8,575,324 8,575,324
Total Assets $91,864,232 $13,456,814 $689,096 $106,010,142

LIABILITIES
Accounts payable $2,967,245 $6,087,518 $9,054,763
Accrued payroll 1,315,106 1,315,106
Deposits payable 6,900,790 6,900,790
Unearned revenue 3,590,382 3,590,382
Total Liabilities 7,872,733 12,988,308 20,861,041

DEFERRED INFLOWS OF RESOURCES
Related to leases 8,223,628 8,223,628

FUND BALANCES
Fund Balance
Nonspendable 10,038,350 10,038,350
Restricted 5,767,252 5,767,252
Assigned 611,754 611,754
Unassigned 59,350,515 468,506 $689,096 60,508,117
Total Fund Balances 75,767,871 468,506 689,096 76,925,473 Total Liabilities, and Fund Balances $91,864,232 $13,456,814 $689,096 $106,010,142 94

CITY OF DALY CITY

GENERAL FUND

COMBINING FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE FOR THE YEAR ENDED JUNE 30, 2024
Total
Special Traffic General
General Deposits Enforcements Funds

REVENUES
Property tax $52,139,564 $52,139,564
Sales tax 26,455,971 26,455,971
Utility users tax 7,095,237 7,095,237
Franchise fees 5,166,543 5,166,543
Other taxes 8,721,612 8,721,612
Licenses and permits 2,587,982 2,587,982
Fines and forfeitures 2,403,017 $5,089 2,408,106
Rents and interest 3,442,315 3,442,315
Federal programs and grants 5,635,834 5,635,834
Receipts from other agencies 1,752,355 1,752,355
Charges and fees 7,672,264 $17,371 7,689,635
Miscellaneous 1,618,086 7,331 1,625,417
Total Revenues 124,690,780 24,702 5,089 124,720,571

EXPENDITURES
Current:

General government 14,075,690 5,759 14,081,449
Public safety 74,700,332 74,700,332
Public works 6,576,604 6,576,604
Culture and recreation 16,120,805 184 16,120,989
Economic and community development 5,373,801 5,373,801
Debt service:

Principal 610,137 610,137
Interest 8,569 8,569
Total Expenditures 117,465,938 5,943 117,471,881

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 7,224,842 18,759 5,089 7,248,690

OTHER FINANCING SOURCES (USES)
Issuance of long-term debt (Note 14) 728,611 728,611
Transfers in 3,232,234 3,232,234
Transfers (out) (12,518,004) (12,518,004)
Total Other Financing Sources (Uses) (8,557,159) (8,557,159) NET CHANGES IN FUND BALANCES (1,332,317) 18,759 5,089 (1,308,469) BEGINNING FUND BALANCES 77,100,188 449,747 684,007 78,233,942 ENDING FUND BALANCES $75,767,871 $468,506 $689,096 $76,925,473 95

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.
97

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, 2024
Variance
Positive
Budget Actual (Negative)

REVENUES
Rents and interest $75,000 $2,464,710 $2,389,710
Federal programs and grants 539,837 98,907 (440,930)
Receipts from other agencies 6,611,685 572,366 (6,039,319) Charges and fees 2,288,197 1,628,048 (660,149)
Miscellaneous 500,000 161,954 (338,046)
Total Revenues 10,014,719 4,925,985 (5,088,734)

EXPENDITURES
Capital projects 38,393,211 6,513,071 31,880,140
Total Expenditures 38,393,211 6,513,071 31,880,140

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (28,378,492) (1,587,086) 26,791,406

OTHER FINANCING SOURCES (USES)
Transfers in 8,495,310 9,595,491 1,100,181
Transfers (out) (4,040,215) (180,648) 3,859,567
Total Other Financing Sources (Uses) 4,455,095 9,414,843 4,959,748 NET CHANGE IN FUND BALANCES ($23,923,397) 7,827,757 $31,751,154 BEGINNING FUND BALANCE 28,983,317
ENDING FUND BALANCE $36,811,074
98

NONMAJOR GOVERNMENTAL FUNDS

SPECIAL REVENUE FUNDS
Special Revenue Funds are used to account for the 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:
• Affordable Housing – to account for the activities of the Daly City Housing Development Finance 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.
• Low and Moderate Income Housing Assets – to account for the activities of the Housing Successor Agency to the Daly City Redevelopment Agency. 99

CITY OF DALY CITY

NONMAJOR GOVERNMENTAL FUNDS

COMBINING BALANCE SHEET
JUNE 30, 2024

SPECIAL REVENUE FUNDS
Total
Community Linda Vista Low and Moderate Nonmajor
Affordable Block Benefit Traffic Income Housing Governmental Housing Grant Assessment Safety Assets Funds
ASSETS
Cash and investments $5,332,953 $654,506 $125,768 $974,581 $7,087,808 Accounts receivable, net 66,823 $334,521 360 401,704
Notes receivable 822,343 822,343
Property held for development 3,366,888 3,366,888
Total Assets $5,399,776 $1,156,864 $654,506 $126,128 $4,341,469 $11,678,743

LIABILITIES
Accounts payable $177,342 $26,671 $204,013
Accrued payroll 5,069 2,060 7,129
Due to other funds 152,110 152,110
Deposits payable $4,001 4,001
Total Liabilities 4,001 334,521 28,731 367,253

DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - loans 822,343 822,343

FUND BALANCES
Restricted 5,395,775 $654,506 $126,128 4,312,738 10,489,147

Total Fund Balances 5,395,775 654,506 126,128 4,312,738 10,489,147 Total Liabilities, Deferred Inflows of
Resources and Fund Balances $5,399,776 $1,156,864 $654,506 $126,128 $4,341,469 $11,678,743 100

CITY OF DALY CITY

NONMAJOR GOVERNMENTAL FUNDS

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED JUNE 30, 2024

SPECIAL REVENUE FUNDS
Total
Community Linda Vista Low and Moderate Nonmajor
Affordable Block Benefit Traffic Income Housing Governmental Housing Grant Assessment Safety Assets Funds

REVENUES
Rents and interest $125,390 $47,293 $58,218 $230,901
Federal programs and grants 486,230 $661,656 1,147,886
Charges and fees 54,923 44,378 $22,200 121,501
Miscellaneous 72,141 168,255 10,112 250,508
Total Revenues 738,684 829,911 91,671 22,200 68,330 1,750,796

EXPENDITURES
Public safety 10,930 10,930
Public works 23,170 23,170
Economic and community development 521,321 767,855 202,199 1,491,375 Total Expenditures 521,321 767,855 23,170 10,930 202,199 1,525,475

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 217,363 62,056 68,501 11,270 (133,869) 225,321

OTHER FINANCING SOURCES (USES)
Transfers in 2,223 257,059 259,282
Transfers out (62,056) (62,056)
Total Other Financing Sources (Uses) (62,056) 2,223 257,059 197,226 NET CHANGE IN FUND BALANCES 217,363 68,501 13,493 123,190 422,547 BEGINNING FUND BALANCES 5,178,412 586,005 112,635 4,189,548 10,066,600 ENDING FUND BALANCES $5,395,775 $654,506 $126,128 $4,312,738 $10,489,147 101

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, 2024

COMMUNITY BLOCK GRANT
Variance Variance
Positive Positive
Budget Actual (Negative) Budget Actual (Negative)

REVENUES
Rents and interest $74,000 $125,390 $51,390
Federal programs and grants 1,241,983 486,230 (755,753) $1,762,456 $661,656 ($1,100,800) Charges and fees 54,923 54,923
Miscellaneous 1,000 72,141 71,141 48,000 168,255 120,255 Total Revenues 1,316,983 738,684 (578,299) 1,810,456 829,911 (980,545)

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
Economic and Community Development
Salaries and benefits 1,398 (1,398) 392,686 380,459 12,227 Services and supplies 105,960 33,693 72,267 509,362 320,644 188,718 Other charges 5,409,341 486,230 4,923,111 513,097 64,192 448,905 Capital outlay 6,080 2,560 3,520
Total Economic and Community Development 5,515,301 521,321 4,993,980 1,421,225 767,855 653,370 Total Expenditures 5,515,301 521,321 4,993,980 1,421,225 767,855 653,370

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (4,198,318) 217,363 4,415,681 389,231 62,056 (327,175)

OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out (389,230) (62,056) 327,174
Total Other Financing Sources (Uses) (389,230) (62,056) 327,174 NET CHANGE IN FUND BALANCES ($4,198,318) 217,363 $4,415,681 $1 ($1) BEGINNING FUND BALANCES 5,178,412
ENDING FUND BALANCES $5,395,775

AFFORDABLE HOUSING
102

LINDA VISTA

BENEFIT ASSESSMENT TRAFFIC SAFETY
Variance Variance Variance
Positive Positive Positive
Budget Actual (Negative) Budget Actual (Negative) Budget Actual (Negative) $3,000 $47,293 $44,293 $5,000 $58,218 $53,218
44,380 44,378 (2) $16,632 $22,200 $5,568
10,112 10,112
47,380 91,671 44,291 16,632 22,200 5,568 5,000 68,330 63,330 25,742 2,807 22,935
1,146 1,382 (236)
6,655 6,741 (86)
33,543 10,930 22,613
22,866 22,669 197
4,000 4,000
500 501 (1)
27,366 23,170 4,196
170,978 159,723 11,255
131,951 42,476 89,475
302,929 202,199 100,730
27,366 23,170 4,196 33,543 10,930 22,613 302,929 202,199 100,730 20,014 68,501 48,487 (16,911) 11,270 28,181 (297,929) (133,869) 164,060 2,223 2,223 257,011 257,059 48
2,223 2,223 257,011 257,059 48
$20,014 68,501 $48,487 ($16,911) 13,493 $30,404 ($40,918) 123,190 $164,108 586,005 112,635 4,189,548
$654,506 $126,128 $4,312,738

INCOME HOUSING ASSETS

LOW AND MODERATE
103

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.
• Pension UAL - to account for funding set-aside towards the City’s pension unfunded actuarial liability.
105

CITY OF DALY CITY

INTERNAL SERVICE FUNDS

COMBINING STATEMENT OF NET POSITION
JUNE 30, 2024
Motor Central Building
Vehicles Services PBX Maintenance
ASSETS
Current Assets:

Cash and investments $6,555,807 $381,872 $452,022 $4,238,079 Accounts receivable, net 85,959 100
Inventories 188,513 39,515
Prepaids 1,830,457 1,484
Total Current Assets 8,660,736 381,872 452,022 4,279,178 Capital Assets:

Land
Buildings 35,817
Equipment 22,689,891 967,235 132,467
Furniture and fixtures 16,490
Subscription assets
Construction in progress
Total Capital Assets 22,725,708 967,235 148,957
Less Accumulated Depreciation (12,640,274) (938,684) (97,009) Net Capital Assets 10,085,434 28,551 51,948
Total Assets 18,746,170 381,872 480,573 4,331,126

DEFERRED OUTFLOWS OF RESOURCES
Related to OPEB 99,031 30,947 241,387

LIABILITIES
Current Liabilities:

Accounts payable 143,349 30,924 534 88,436
Accrued payroll 15,629 846 36,331
Interest payable 40,636
Accrued claims payable
Leases payable 456,190
Subscription liability
Total Current Liabilities 655,804 31,770 534 124,767
Long-Term Liabilities:

Compensated absences 650,377 486,176
Accrued claims payable
Net OPEB Liability 524,312 163,847 1,278,010
Leases payable 2,039,353
Subscription liability
Total Long-Term Liabilities 3,214,042 163,847 1,764,186 Total Liabilities 3,869,846 195,617 534 1,888,953

DEFERRED INFLOWS OF RESOURCES
Related to OPEB 113,632 35,510 276,979

NET POSITION
Net investment in capital assets 7,589,891 28,551 51,948 Restricted for debt service
Unrestricted 7,271,832 181,692 451,488 2,354,633
Total Net Position (Deficit) $14,861,723 $181,692 $480,039 $2,406,581 106