Fairfield City Council
January 20, 2026

Agenda Item No: L.1

AGENDA REPORT
DATE: January 20, 2026
TO: Mayor and Council
FROM: David Gassaway, City Manager
SUBJECT: Resolution 2026-09 FN Fiscal Year 2024-2025 Annual Comprehensive Financial Report and the Draft Schedule of Expenditures for Federal Awards Report Approving the Fiscal Year 2024-2025 Annual Comprehensive Financial Report and the Draft Schedule of Expenditures for Federal Awards Report (Single Audit) and Other Reports Funding Source: N/A
Contact: John Furtado, (707) 428-7629

RECOMMENDED ACTION
Adopt resolution.

STATEMENT OF ISSUE
City council is being asked to approve the Annual Comprehensive Financial Report (ACFR) for fiscal year (FY) 2024-2025, as well as the draft Schedule of Expenditures for Federal Awards Report (Single Audit). The FY 2024-2025 ACFR indicates the City’s financial condition as of June 30, 2025, and has been audited by The Pun Group LLP, an independent audit firm of Certified Public Accountants. The FY 2024-2025 draft Schedule of Expenditures for Federal Awards Report is expected to comply applicable to major federal programs and will be audited in February of this year. Staff will bring forward for approval a revised report if there are any changes to the current draft, and at this time staff is not anticipating any changes to occur.

DISCUSSION
Each year, an independent Certified Public Accounting (CPA) firm audits the City’s financial statements (ACFR) and federal grants (Single Audit) in accordance with Generally Accepted Auditing Standards (GAAS).

The ACFR provides a detailed overview of the City's financial position, covering all funds. It is prepared in conformity with Generally Accepted Accounting Principles (GAAP) and designed as a general-purpose report, meeting the informational needs of a wide range of stakeholders.

The Schedule of Expenditures of Federal Awards (SEFA) report, detailing federal grant expenditures, was prepared by City management and will undergo auditing in February 2026 as part of the Single Audit process. The Single Audit evaluates compliance with the Federal Office of Management and Budget (OMB) compliance supplement requirements for federal grant recipients.

The auditors have issued an unmodified opinion on the ACFR, the highest level of assurance, indicating that the financial statements fairly represent the City of Fairfield’s financial position.

For further details, refer to the Auditor’s Opinion on page 1 of the ACFR.

A concise summary of the City's financial condition can be found in:
 Transmittal Letter and Management’s Discussion and Analysis (MD&A) sections of the ACFR.
 Popular Annual Financial Report (PAFR) for FY 2024-2025, included in this submission.

The PAFR is a simplified, unaudited version of the ACFR that highlights key financial information for ease of understanding.

Additional insights and supporting details are available in the Notes to the Financial Statements within the ACFR.

The following section outlines key financial positions and highlights the City’s major funds:

Government-Wide: As of the close of FY 2024-25, the City’s assets plus deferred outflows exceeded its liabilities plus deferred inflows, resulting in a net position of $672 million. Key components of this figure include:
 Unrestricted Net Position: A deficit of -$41 million, primarily influenced by:
o The City’s net pension liability, which stands at $249 million. o Increases in compensated absences and claim liabilities.  Total Long-Term Liabilities: These decreased by $6 million, primarily due to scheduled debt service payments on the City’s Pension Obligation and Utility Revenue Bonds.

By fiscal year-end, the City’s governmental funds reported a combined ending fund balance of $256 million, underscoring the City's overall short-term financial stability while acknowledging ongoing challenges tied to long-term obligations.

The City’s governmental funds reported a combined ending fund balance of $256 million, an increase of $6 million or 2.4% over the prior year. Total fund balances include cash and non-cash assets (such as receivables and land assets). A notable change in governmental fund balances in FY 2025 was an increase in the non-major governmental funds of $10.0 million, which was due to gas tax and development taxes received that will be used to fund Capital Projects.

The General Fund balance remained largely unchanged from the prior year, with a modest reduction of $58,000, bringing the ending balance to $57.3 million. General Fund revenues exceeded the final budget by $5.8 million (4.1%), driven primarily by higher collections in sales and property taxes, intergovernmental revenue, and other miscellaneous revenues.

Key Revenue Highlights

1. Property Taxes
o Increased by $2.2 million (4.9%), primarily due to:
 New development and rising property values.
 A significant adjustment by the County, correcting prior-year uncollected taxes in the assessed rolls.

2. Sales Taxes
o Rose by $731,882 (2.3%) owing to renewed economic activity, particularly in:
 Building and construction.
 Restaurant sales within the city.

3. Charges for Services
o Increased by $698,252 reflecting:
 Growth in planning and building-related fees that fell slightly below projections due to staffing shortages impacting review processes.  Recovery of prior year Fire emergency response and first responder fees.

Despite revenue challenges in some areas, the City demonstrated fiscal resilience, with key revenue streams outperforming expectations and offsetting shortfalls.

General Fund Expenses including transfers out were under budget by $1.9 million or 1.3% after eliminating capital outlay, mainly due to the City-wide effort to reduce expenditures to offset the ongoing budget deficit the City still is reflecting.

Internal Service Fund Liabilities: As shown in the transmittal letter, the table below shows some of the key liabilities of the internal service funds and their associated levels of funding:

The City’s Worker’s Compensation and General Liability funding needs significantly increased due to the number and size of claims and settlements. The General Liability Fund specifically was impacted by the performance of the City’s insurance pool, which also saw an increased number and size of claims and settlements that resulted in a one-time assessment and increased premiums to address the funding needs. The City’s Compensated Absences liability also continues to grow due to the addition of more staffing, compounded by labor contract cost of living adjustment increases applied to those outstanding balances.

Workers'
Compensation
General
Liability
Other PostEmployment
Benefits
(OPEB) (1,2)
Compensated
Absences Combined
Cash Reserve (3) $ 7,253,005 $ 1,152,219 $ 330,156 $ 11,518,984 $ 20,254,364 Actuarial Liability $ 13,328,000 $ 6,783,000 $ 162,648 $ 23,534,120 $ 43,807,768 % of Liability Funded 54% 17% 203% 49% 46%

Intra-governmental Loan Fund: The Intra-governmental Loan Fund balance decreased by $1.3 million, dropping from $37.4 million to $36.1 million during FY 2024-2025. This change was driven by the following factors:
 Transfers Out:
o $1.6 million transferred to the Capital Projects Fund, to fund the Downtown Streetscape project.
 Expenditures:
o $0.7 million was paid to the Housing Fund, funded by loan repayments received from the former redevelopment agency.

Water Funds: The net position of the Water Funds decreased by $1.4 million during FY 2024- 2025 from $83.9 to $82.5 million. This was mainly due to the water rates that have not been adjusted since 2021 which resulted in an operating deficit of $4.2 million. The City currently can pay the short-term payments and will be increasing water rates starting January 1, 2026, to restore financial sustainability.

Golf Funds: The Golf Funds show an accumulated net position of $14.6 million, mainly consisting of the net capital assets of the golf courses themselves of $13.4 million. The courses have become more self-sustaining since costs (excluding depreciation) have not exceeded revenues and for the fifth consecutive year, the courses did not require additional support from the City.

Transit: The net position of the Transportation Funds increased by $1 million during FY 2024- 2025. This was primarily due to the addition of multiple new buses to the fleet with total net fixed assets increasing by $700,000. California’s farebox recovery requirements of 20% have been deferred due to the COVID-19 pandemic with no set date for reinstatement. The total farebox recovery for transit in FY 2024-2025 was 3.48%.

CalPERS and Net Pension Liability: As of June 30, 2025, the City’s combined total Net Pension Liability (NPL) is approximately $249 million, which showed no change from last year due to higher than anticipated earnings. The NPL is a result of comparing total pension plan assets of $621 million to the total pension liability of $870 million, which reflects that approximately 71.4% of the pension liability has been funded through June 30, 2024, the date of the most recent pension actuarial report provided by CalPERS. This compares to a 69.9% funding level in the prior year. The City’s net liability was impacted by a 9.3% investment return for CalPERS in FY 2023- 2024, which exceeded the target of 6.8% rate of return. This caused the City’s NPL to remain unchanged since the liability and rate of return offset each other. Of the total NPL, $21 million was allocated to the Water fund; $7 million to the North Bay Regional Water Treatment Plan (NBR) Fund; and $3 million to the Transit Fund based upon Full-Time Equivalent Employees (FTEs) allocated to these funds. The remaining NPL relates to the General Fund and other governmental funds ($218 million) and is accounted for in the Government-Wide Statement of Net Position.

Other Reports
Measure P Compliance report: The City’s independent auditors have completed a Transactions and Use Tax Ordinance Compliance and Internal Control Audit Report. The City is found to comply with the Ordinance (Attachment 9)
User Utility Tax Compliance Report: The City’s municipal code requires that Independent auditors perform a Compliance and Internal Control Audit Report. The City is found to comply with the Ordinance (Attachment 10)
Transportation Development Act (TDA) Audit:- The California Code of Regulations, requires each transportation planning agency, to transmit to the State Controller annually and within 12 months of the end of the fiscal year, a report of an audit of its accounts and records by the appropriate county auditor, a certified public accountant, or a public accountant pursuant to Sections 6505 and 26909 of the Government Code. The audit report is attached (Attachment 11).

Audit Findings: For the ACFR, the auditor had no findings in the current year.

Summary: The City received an unmodified opinion and received positive feedback once again from the auditors for the work performed and reports prepared by the City’s Accounting Division.

This is also demonstrated by the fact that the City was awarded the Certificate of Achievement for Excellence in Financial Reporting by the Government Finance Officers Association (GFOA) for the 37th year for FY 2023-2024. In addition, the City has also been awarded the Triple Crown, having achieved all three of GFOA’s top certifications including the Popular Annual Financial Reporting Award and the Distinguished Budget Presentation Award.

FINANCIAL IMPACT
The cost of the audit of the City’s ACFR is included as part of the General Fund budget (Fund 101, Division and Responsibility Code 24001). There is no financial impact resulting from the acceptance of the report.

PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION
On January 12, the City Council’s Audit Committee met with the independent auditors and reviewed and received the attachments to this report.

ALTERNATIVE ACTION
The council may choose not to approve the resolution and the acceptance of the ACFR for the FY ending on June 30, 2025. However, it should be noted that any changes to the report at this point would result in additional costs incurred by the City.

COORDINATED WITH
N/A

STAFF CONTACT
John Furtado, Director of Finance
(707) 428-7629
[email protected]

ATTACHMENTS
Attachment 2: Proposed Resolution
Attachment 3: Annual Comprehensive Financial Report (ACFR) Attachment 4: Draft Schedule of Expenditures for Federal Awards Report Attachment 5: Letter from Auditors to City Council on Governance Attachment 6: Auditor’s Report on Internal Control
Attachment 7: Popular Annual Financial Report Fiscal Year 2024-2025 Attachment 8: GANN Appropriations Limit Calculation for 2024-2025 Attachment 9: Measure P Compliance Report for 2024-2025 Attachment 10: User Utility Tax Compliance Report for 2024-2025 Attachment 11: Transportation Development Act (TDA) Audit 2024-2025

CITY OF FAIRFIELD
RESOLUTION NO. 2026-09
APPROVING THE FISCAL YEAR 2024-2025 ANNUAL COMPREHENSIVE FINANCIAL REPORT AND

THE DRAFT SCHEDULE OF EXPENDITURES FOR FEDERAL AWARDS REPORT (SINGLE AUDIT)

AND OTHER REPORTS
NOW, THEREFORE, THE COUNCIL OF THE CITY OF FAIRFIELD HEREBY RESOLVES:

Section 1. Pursuant to Section 37208 (c) of the Government Code, the Fiscal Year 2024-2025 Annual Comprehensive Financial Report and Draft Schedule of Expenditures for Federal Awards Report (Single Audit), and other reports are hereby approved and ratified.

Section 2. The city manager and Director of Finance are hereby authorized to take all actions necessary to implement this resolution.

PASSED AND ADOPTED this 20th day of January 2026, by the following vote:

AYES: MEMBERS: MOY/BERTANI/CARR/PANDURO/SANDHU/TONNESEN/WILLIAMS NOES: MEMBERS: _________________________________________________ ABSENT: MEMBERS: _________________________________________________ ABSTAIN: MEMBERS: _________________________________________________ _________________________________________________
MAYOR
ATTEST:
___________________________

CITY CLERK

City of Fairfield, California
Annual Comprehensive Financial Report
Fiscal Year Ended June 30, 2025

City of Fairfield, California
Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2025
Prepared by:

Finance Department

i
City of Fairfield, California
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025
Table of Contents
Introductory Section (unaudited) Page
Table of Contents i
City Council, Elected Officials, and Management Leadership Team iv Letter of Transmittal v
Organization Chart xvi
Certificate of Achievement for Excellence in Financial Reporting xvii Financial Section
Independent Auditor's Report 1
Management's Discussion and Analysis 4
Basic Financial Statements:

Government-Wide Financial Statements:

Statement of Net Position 17
Statement of Activities 18
Fund Financial Statements:

Governmental Funds:

Balance Sheet 22
Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position 24
Statement of Revenues, Expenditures and Changes in Fund Balances 26 Reconciliation of the Governmental Funds Statement
of Revenues, Expenditures and Changes in Fund Balances
to the Government-Wide Statement of Activities 28
Proprietary Funds:

Statement of Net Position 30
Statement of Revenues, Expenses and Changes in Net Position 32 Statement of Cash Flows 34
Fiduciary Funds:

Statement of Fiduciary Net Position 39
Statement of Changes in Fiduciary Net Position 40
Notes to Basic Financial Statements 42

ii
City of Fairfield, California
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025
Table of Contents (continued)
Financial Section, (continued) Page
Required Supplementary Information: (unaudited)
Schedule of Changes in Net Pension Liability and Related Ratios - Miscellaneous Plan 94 Schedule of Changes in Net Pension Liability and Related Ratios - Safety Plan 95 Schedule of Contributions - Miscellaneous Plan 96
Schedule of Contributions - Safety Plan 97
Schedule of Changes in Net OPEB Liability and Related Ratios 98 Schedule of Contributions - Net OPEB Liability 99
General Fund: Schedule of Revenues, Expenditures and Changes 100 in Fund Balance - Budget and Actual
Low Mod Income Housing Major Special Revenue Fund: Schedule of 101 Revenues, Expenditures and Changes in Fund Balance - Budget and Actual Supplementary Information:

City Capital Projects - Major Capital Projects Fund: Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual 103 Non-Major Governmental Funds:

Combining Balance Sheet 106
Combining Statement of Revenues, Expenditures and Changes in Fund Balances 110 Combining Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual 114
Internal Service Funds:

Combining Statement of Net Position 122
Combining Statement of Revenues, Expenses and Changes in Net Position 124 Combining Statement of Cash Flows 126
Custodial Funds:

Combining Statement of Fiduciary Net Position 132
Combining Statement of Changes in Fiduciary Net Position 134 Statistical Section (unaudited) Table
Net Position by Component 1 138
Changes in Net Position 2 140
Governmental Activities Tax Revenues by Source 3 144
Fund Balances of Governmental Funds 4 146
Changes in Fund Balances of Governmental Funds 5 148

iii
City of Fairfield, California
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025
Table of Contents (continued)
Statistical Section (unaudited), (continued) Table Page Changes in Fund Balances of General Fund 6 150
Assessed Value and Estimated Actual Value of Taxable Property 7 152 Property Tax Rates - Direct and Overlapping Governments 8 153 Principal Property Taxpayers 9 154
Property Tax Levies and Collections 10 155
Ratios of Outstanding City Debt by Type 11 156
Ratios of General Bonded Debt Outstanding 12 157
Direct and Overlapping Governmental Activities Debt 13 158 Legal Debt Margin Information 14 160
Utility and Golf Debt Pledged Revenue Coverage 15 162
Demographic and Economic Statistics 16 164
Principal Employers 17 165
Full-time Authorized City Government Employees by Function 18 166 Operating Indicators by Function 19 167
Capital Asset Statistics by Function 20 168

Pam Bertani
Vice-Mayor
District 4
Manveer Sandhu
Councilmember
District 6
Scott Tonnesen
Councilmember
District 2
Catherine Moy
Mayor
Doug Carr
Councilmember
District 3
K. Patrice Williams
Councilmember
District 1
Doriss Panduro
Councilmember
District 5
Karen L. Rees
City Clerk
Arvinda Krishnan
City Treasurer
City Council and Elected Officials
David Gassaway
City Manager
John Sturdee
Fire Chief
Naveed Ashraf
Director of Information Technology
Dave Zellers
Director of Community & Economic
Development
LaTanna Jones
Director of Housing
Kristina Kaunzinger
Director of Parks & Recreation
David Lim
City Attorney
Sanjay Mishra
Director of Public Works
John Furtado
Director of Finance
Dan Marshall
Police Chief
Farbod Pirouzmand
Assistant City Manager/
Director of Human
Resources
Management Leadership Team

iv
v
December 16, 2025
Honorable Mayor and City Council
City of Fairfield, California
The City is pleased to submit its Annual Comprehensive Financial Report (ACFR) of the City of Fairfield (the City) for the fiscal year ended June 30, 2025. The information contained in this ACFR is prepared in conformity with U.S. Generally Accepted Accounting Principles (GAAP) and includes an unmodified opinion on the report by the City’s independent certified public accountants, The Pun Group LLP.

Management assumes responsibility for the accuracy and fairness of the information provided in this report.

The ACFR is presented in three sections: introductory, financial, and statistical. The introductory section includes this transmittal letter, the City’s organizational chart, and a list of municipal officers and officials. The financial section includes management’s discussion and analysis (MD&A), government-wide financial statements, fund financial statements, notes to the financial statements, and required supplementary information, as well as the auditor’s report on the financial statements and schedules. The MD&A provides additional information regarding the management of the City’s finances and should be read in conjunction with the transmittal letter. The statistical section includes selected financial and demographic information of the City, generally presented on a multi-year basis.

The Reporting Entity and Services Provided
Fairfield is a general law city and operates under a Council-Manager form of government. The City provides a full range of municipal services, including police, fire, water, public transportation, streets and sidewalks, housing assistance, cultural and recreation facilities, golf courses, public works and parks, planning, and economic development. Sewer service is provided by agreement with the Fairfield-Suisun Sewer District, which operates and maintains interceptors and the treatment plant, while the City maintains local collector sewers.

This report includes all activities considered to be a part of, controlled by, and dependent on the City.

Accordingly, this report includes the financial activities of the following:

Water Facilities Improvement District
Municipal Park Improvement District
Housing Authority
Public Financing Authority
Storm Drain Facilities Improvement District
Community Facilities Districts

vi
City and Government Profile
Fairfield sits at the northeastern portion of the San
Francisco Bay Area. The County seat of Solano County
since 1858, Fairfield has the vision of a progressive city.

Founded in 1856 by Captain Robert Waterman, the City
was named after Fairfield, Connecticut, Waterman’s
hometown. Community amenities include an enclosed
regional shopping mall with over one million square
feet and 150 stores, an adult recreation center, the
650-acre Rockville Hills Park, and a weekly farmer's
market in season. Situated between the two largest
metropolitan areas of Northern California, Fairfield
bridges the gap between the San Francisco Bay Area
and the Sacramento metropolitan region. The Napa
and Sonoma wineries lie within an hour to the west,
and Lake Tahoe two hours to the east.

The City is a general law city and was incorporated in
1903. It has a Council-Manager form of government
with the Mayor elected at large and six Council
members elected by district. They all serve four-year, staggered terms. The City has two citizen commissions Planning and Youth, and five oversight and advisory committees, all whose members are appointed by Council to a fixed term. They are the Landscape Oversight Committee (seven members), the CDBG Advisory Committee (five members), the Golf Advisory Board (six members), the Measure P Oversight Committee (five members) and the Rockville Hills Regional Park Citizen Advisory Committee (seven members). The City Clerk and Treasurer are directly elected. The City Council appoints the City Manager and City Attorney. The City Manager appoints department heads.

The City is organized into ten departments: Public Works, Police, Fire, Finance, Human Resources, Information Technology, Community Development, Parks and Recreation, Housing Services, and City Manager’s Office (CMO); with the CMO including Clerk and Legal offices. For reporting purposes, the financial statements present CMO and Human resources under Administration while Information Technology is reported in an Internal Service Fund.

The chart below shows the City’s full-time staff levels during the past ten years. The City’s employees are 0.5% of the total population of the City. The City
provides a broad range of services including
police and fire protection; construction and
maintenance of streets, parks, storm drains,
and other infrastructure; recreational and
cultural activities, including two 18-hole
championship golf courses; and administrative
support services. Some major public services
delivered within the City’s boundaries, including
library, wastewater, and education, are
provided by other governmental agencies. The
City is not financially accountable for the
operations of these franchises or government
agencies.
534 541 548
558
571
585
610 613 607 599
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Total Authorized Full-Time Employees

veterans
owners of homes square miles
(DOF Estimates E-1)
Major Employers: Travis Air Force Base, County of
Solano, Fairfield-Suisun School District, Northbay
Medical Center and Solano Community College



million gallons of water
produced annually by the
COF’s water plants

golf courses managed


calls for Fire service
in 2024

Average Commute
Travel Time

average Police
department response
time in 2023

Residents with HS diploma

have a Bachelor’s Degree
(2024 Census)




population
of Fairfield


Female
Male


businesses in the City of Fairfield have a business license Size of Fairfield
Population of Fairfield
vii

viii

Accounting System and Budgetary Control
Note 1 in the Basic Financial Statements provides a detailed overview of the City’s significant accounting policies. The City has implemented internal controls to safeguard government assets from loss, theft, or misuse and to ensure the responsible management of public resources. Recognizing that the costs of internal controls should not exceed their benefits, the City’s framework is designed to provide reasonable, not absolute assurance that financial statements are free from material misstatements.

FY 24–25 marked a year of operational maturity and strategic expansion in the City’s use of the Tyler Munis ERP system. Building on the foundational go-lives of financial and human capital modules in prior years, this fiscal year focused on optimizing workflows, refining reporting capabilities, and preparing for future integrations. Notably, the ERP system played a central role in streamlining year-end processing, including automated tracking of open POs and contracts across departments. These enhancements not only improved fiscal closeout accuracy but also supported more agile budget rollovers. Looking ahead, the City is actively evaluating complementary tools such as DigEplan to further modernize digital plan review and integrate with EnerGov, signaling a continued commitment to digital transformation and service delivery excellence.

The City prepares a two-year budget, where departments collaborate with the City Manager and Finance Department to submit operating budget requests. The City Manager and Director of Finance then present budget recommendations to the City Council. Following public discussion and evaluation, the City Council adopts the two-year budget, multi-year forecast, and a mid-cycle budget update at the end of the first year.

Expenditures are controlled at the fund level for all departments, and spending cannot legally exceed appropriations. Budgets are adopted on a basis substantially aligned with GAAP. Any amendments that exceed the total appropriations of a fund require City Council approval.

Economic Overview of the City and Region 201
Below is a summary analysis of some key indicators of the region’s economic environment.

Stock and Financial Markets
The national economy continued to expand in FY 2025, though signs of deceleration emerged in the second half of the year. Equity markets posted strong gains, with the S&P 500 rising 39.4% and the Dow Jones up 12.5%, buoyed by resilient corporate earnings and investor optimism. However, interest rates remained elevated as the Federal Reserve maintained a restrictive stance to combat inflation, which, while easing, remained above the 2% target. Looking ahead, the City anticipates gradual economic softening as the effects of tighter financial conditions and policy uncertainty, including those stemming from the new federal administration. Meanwhile, statewide consensus forecasts have been revised downward, with FY 2025–26 growth trimmed from 1.8% to 1.0%, reflecting weaker consumer confidence and moderating labor market conditions.

Locally, Fairfield experienced robust business activity in FY 2024–25, driven by new business openings and strong consumer spending, particularly in the restaurant and hospitality sectors. However, forecasts for FY 2025–26 anticipate a slowdown, with flat sales tax growth and a 2% decline in construction activity due to high borrowing costs and softening demand.

ix
Economic Overview of the City and Region (Continued)
Below are the changes in the financial market as of June 30, 2025:

Financial Market Rate Fiscal Year Change
Dow Jones 44,201 5,082
S&P 500 6,205 1,755
2 Year Treasury 3.70% -1.02%
30-Year Home Mortgage 6.75% -0.32%
Employment
The nationwide unemployment rate was unchanged compared to the last fiscal year at 4.1% while unemployment in the region has seen an uptick of 0.5%. The uptick in the region’s unemployment rate is attributed to multiple factors: job losses in the information technology sector and overall slowing job growth. Regionally, recruitment timelines lengthened and labor force participation plateaued, suggesting a more cautious hiring environment. These trends align with broader economic signals, including a modest rise in delinquencies and consumer credit stress, as well as a slight uptick in unemployment of approximately 0.5%. While the labor market remains resilient, these developments point to a gradual cooling, consistent with the Federal Reserve’s ongoing efforts to balance inflation control with economic stability.

Unemployment Rate Fiscal Year Change
United States 4.1% 0.0%
California 5.4% 0.2%
Solano County 5.6% 0.5%
Fairfield 5.6% 0.5%
Inflation
Inflation across the board has begun to cool. The personal savings rate has also continued to come down as consumers use savings to cover higher costs. The personal savings rate was 5.0% for June 2025 and had dropped to 4.6% by August 2025.

Inflation Rate Fiscal Year Change
Bay Area CPI 1.5% -1.7%
Turner Building CPI 1.2% 0.3%
Personal Savings Rate 5.0% -0.2%
Oil Prices (as of 6/30/25) $67 -$15

x
Economic Overview of the City and Region (Continued)
Sales and Use Tax
In California, sales tax
performance for FY 24-25 saw a
decline of 0.6% adjusted for
economic data. The City of
Fairfield experienced an
increase in sales tax that totaled

2.9% for FY 24-25, with a
decrease of 3% and 16% in the
general consumer goods and
fuel and service stations industry
groups, which was offset by
increases to business and
industry of 14% and autos and
transportation of 4%. Measure P saw a second year of decline in FY 24-25 of 2.6%. The chart above shows the change in sales tax for the past 10 years, reflecting an average growth of 4%. The City provides a Tax Abatement incentive program to help provide a stimulus to the City’s economy, increase the tax base and create more jobs within the City.

Property Taxes
In FY 24-25, Fairfield property values
increased by approximately 4.3%, the
citywide growth in the FY 24-25
assessment roll was 7.1%. Residential
uses had an increase of 6.3% which was
offset by declines in unsecured assets.

Unsecured assets decreased due to
possessory interests with values in the
prior year that have been dropped from
the roll.

Through calendar year 2025, singlefamily residential homes are selling for

0.86% less than in the previous calendar
year. Due to the price decreases
reported last year, there were 110
additional homes added for temporary
review and monitoring per Proposition 8,
bringing the value outstanding to $157
million, with the number of homes at

3.4% of all homes in the City.
3%
-3%
3%
15%
13%
-2%
6%
2%
-2%
8%
-5% 0% 5% 10% 15% 20%
24-25
23-24
22-23
21-22
20-21
19-20
18-19
17-18
16-17
15-16
Commercial
11%
Industrial
11%
Other
2%
Residential
72%
Unscecured
4%
Net Taxable Value % by Category

xi
Economic Overview of the City and Region (Continued)
Housing
Housing sales totaled 768 units
sold during the calendar year
2024, median sales price was
$600,000 for the year. This
represented a 1% decrease
over the prior year. The impact
of stubborn interest rates has
begun to cool the housing
market, and prices have begun
to decline, with a drop in
median sales price of 2.5% for the first 9 months of calendar year 2025.

Economic Condition and Outlook – General Fund
The City was able to maintain General Fund reserves
above the City Council’s established level of 20% of
expenditures during FY 24-25, primarily due to the use of one-time monies.

The General Fund’s major revenue sources are primarily
derived from taxes (84%), including property and sales
taxes / Measure P local taxes, utility users and franchise taxes, transfer and vehicle taxes, and hotel taxes. The remaining 16% includes revenues such as licenses and permits, charges for services, miscellaneous income, and interest/rental income. The City continues to project a structural deficit, previously projected a structural deficit averaging $11-$12 million annually. The primary factor driving this increasing deficit is the structure and projected payments of the CalPERS Unfunded Actuarial Liability (UAL), along with rising general liability costs. Costs continue to be evaluated, and a future sales tax is being explored to structurally resolve the ongoing deficit. $300,000
$400,000
$500,000
$600,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Median Price of Home Sales

xii
Economic Conditions and Outlook – Other Funds
The five-year forecast includes the following assumptions:
• Property tax growth of approximately 3.5% to 5%, resulting from new development and increased assessed values for properties within the City. • Sales tax and Measure P taxes are projected to grow at 3%. • Wage increases for FY 25-26 were projected at 0% with 2% increase in the long-term forecast. • Increases of 2-5% annually on non-personnel expenses, depending on the nature of each of those components, and reflect the estimated inflation rate. • Includes the City’s estimated pension contribution rates provided by CalPERS. It also assumes that CalPERS achieves a 6.8% return on investment in the long run.

Golf Funds
In January 2024, the City transitioned golf course
operations to a new operator. Although the transition
incurred substantial one-time costs primarily related to contractual changes, staffing, and operational setup, the golf course enterprise funds remain self-sufficient and continue to operate without support from the General
Fund. Looking ahead, the golf courses face several deferred capital improvement needs, including maintenance of aging infrastructure, equipment replacement, and facility upgrades. These capital expenditures will be addressed incrementally as revenues allow and as part of long-term planning efforts to ensure the course remains financially stable and competitive as a recreational asset for the community.

Transit
Ridership continues to struggle, and revenues are not
projected to meet California’s farebox recovery
requirements of 20% which is currently being deferred
through June 30, 2026. For FY 2024-25, the farebox
recovery was 3.48% which continues to trend downward.

FY 2023-24 and FY 2022-23 were at 4.22% and 5.74%
respectively. In FY 2016 ridership was at 1 million
passengers, FY 2025 saw the lowest number of ridership in the last 10 years at 181,586 passengers. The following
strategies will be implemented to improve future transit funding:

1. Develop a comprehensive long-term financial plan the projects revenues and expenditures over multiple years and incorporate contingency strategies to manage uncertainty.

2. Increase competitiveness for federal and state grants by aligning proposed projects with key funding priorities and ensuring they are shovel-ready with demonstrated community support.

3. Enhance collaboration with regional partners to coordinate services, optimize resource sharing, and align investment strategies across jurisdictions.

4. Establish ongoing performance evaluation processes to monitor financial health, assess progress, and adjust funding strategies in response to shifting ridership trends, economic conditions, and policy developments.

xiii
Economic Conditions and Outlook – Other Funds (Continued) Water Funds
The City has not implemented a water rate increase since 2021, resulting in a second consecutive year of operating deficits in the Water Utility Fund. In FY 2025, operating expenses exceeded revenues by $4.25 million, and the fund continued to rely on reserves to maintain service levels. The Water Master Plan was adopted earlier this year and approved by City Council in which the new rates are scheduled to take effect on January 1, 2026.

The proposed rate structure is designed to restore financial sustainability while supporting critical infrastructure investments. Capital needs, such as reservoir mixing improvements, high-lift pump upgrades, and GIS integration—are being addressed through reserve funding in the interim. The City has also launched a robust public outreach campaign to ensure transparency and community engagement throughout the Prop 218 process.

Looking ahead, the City remains committed to balancing affordability with long-term water system reliability, especially in light of inflationary pressures, regulatory mandates, and climate-related risks.

Capital Project Funds
To assist in building new parks and facilities, including police and fire infrastructure, the City relies on the collection of its AB 1600 Impact fees from new developments in the City. Without
continued new development, future parks and facilities may be delayed or eliminated from the City’s master plan. In addition to new parks and facilities, the City also transfers in Gas Tax revenue to fund street capital projects. The current Capital Improvement Plan includes 105 projects valued at $92.4 million over FY 25-26 and FY 26-27. An update to AB 1600 Impact fees for parks, facilities, and urban design are anticipated in FY 25-26.

Internal Service Funds
These funds account for many services provided to all departments within the City, including the funding for insurance and compensated absences. Since the City is self-insured, it is prudent to fund a portion, or all the liability owed over time so other funds are not heavily affected in any given year.

The claims environment remains challenging, with higher verdicts, an increased number of cases, and larger settlements. The California Joint Powers Risk Management Authority (CJPRMA), the City’s insurance pool, has historically relied on a ten-year rolling average actuarial method to establish funding rates. However, this approach has proven insufficient to keep pace with the rapidly evolving claims landscape, resulting in a significantly underfunded pool. In FY 2024-25, CJPRMA implemented an additional one-time assessment on pool members. Should current trends persist, further assessments may be necessary in future years. The City’s Compensated Absences liability also increased 4.5% due to the last year of expiring labor contracts. The liability is currently 49% funded for planned payoutsfrom labor union agreements as well as retirements. See Notes 11 and 15 in the City’s FY 24-25 Annual Comprehensive Financial Report for the actuarial assumptions used.

xiv
Economic Conditions and Outlook – Other Funds (Continued) The major self-insurance liabilities, other post-employment benefits (OPEB), and compensated absences with their corresponding funding reserves as of June 30, 2025, are listed below:

Workers'
Compensation
General
Liability
Other PostEmployment
Benefits
(OPEB) (1,2)
Compensated
Absences Combined
Cash Reserve (3) $ 7,253,005 $ 1,152,219 $ 330,156 $ 11,518,984 $ 20,254,364 Actuarial Liability $ 13,328,000 $ 6,783,000 $ 162,648 $ 23,534,120 $ 43,807,768 % of Liability Funded 54% 17% 203% 49% 46%
(1, 2) The cash reserve represents the cash in the City’s OPEB fund at June 30, 2025. The liability represents the actuarial accrued liability (as presented in the Required Supplementary Information).
(3) Represents available cash in these specific funds at June 30, 2025. Does not include other insurance fund balances that do not relate to Workers’ Compensation, General Liability, or OPEB.

Trend Information / Comparison of Cities
See the City’s original budget for fiscal years 25-26 and 26-27 for more information regarding these trends among comparable cities as of June 30, 2025:
 The City’s population growth rate is about average.
 The City’s per capita revenues from tax revenues are below average.  The City has had significant swings in its property and sales tax revenues, building and foreclosure activity, unemployment rates, transit ridership, and golf rounds played.  The City’s pension obligation contribution rate has increased significantly over the past ten years.  The City’s Other Post-Employment Benefits (OPEB) liability is significantly below the average.

City of Fairfield, California
Organization Chart
xvi
Citizens of
Fairfield
City Clerk Mayor & City
Council
Commissions City Manager
Community
& Economic
Development
Housing Information
Technology Finance Human Resources
Parks and
Recreation Fire Police Public Works
City Attorney
City
Treasurer

Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Fairfield
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2024
Executive Director/CEO

xvii
City of Fairfield
People and Places in the City
xviii Page 395 of 968
6 Hutton Centre Drive, Suite 1200
Santa Ana, California 92707
INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and Members of the City Council
of the City of Fairfield
Fairfield, California
Report on the Audit of the Financial Statements
Opinions
We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Fairfield, California (the “City”), as of and for the year ended June 30, 2025, 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 accompanying financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, business-type activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2025, and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

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

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

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
1

To the Honorable Mayor and the Members of the City Council of the City of Fairfield
Fairfield, California

2 Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions.

Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS 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 GAAS and Government Auditing Standards, we  exercise professional judgment and maintain professional skepticism throughout the audit.  identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.  obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed.  evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.  conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.

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

Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management’s Discussion and Analysis, Budgetary Comparison Schedules, the Schedules of Changes in Net Pension Liability and Related Ratios, and the Schedules of Contributions - Pensions, the Schedule of Changes in Net OPEB Liability and Related Ratios and Schedule of Contributions - OPEB, 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 GAAS, 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.

To the Honorable Mayor and the Members of the City Council of the City of Fairfield
Fairfield, California

3 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 Combining and Individual Fund Financial Statements are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with GAAS. In our opinion, the Combining and Individual Fund Financial Statements are 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 and Statistical Sections 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 exists, we are required to describe it in our report.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 16, 2025, on our consideration of 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 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 City’s internal control over financial reporting and compliance.

Santa Ana, California
December 16, 2025

City of Fairfield, California
Management Discussion and Analysis
4 This Management’s Discussion and Analysis (MD&A) provides an objective overview of the City of Fairfield’s (City) financial activities and performance for the fiscal year ended June 30, 2025. Prepared in accordance with standards established by the Governmental Accounting Standards Board (GASB), the MD&A is intended to assist readers in understanding the City’s financial position, results of operations, and significant changes from the prior fiscal year. It should be read in conjunction with the transmittal letter, the basic financial statements, and the accompanying notes to the financial statements.

Overview of the Financial Statements
This discussion and analysis serve as an introduction to the City’s basic financial statements, which consist of three components: (1) Government-Wide Financial Statements, (2) Fund Financial Statements, and (3) Notes to the Basic Financial Statements. The financial statements presented herein include all the activities of the City and its component units.

Government-Wide Financial Statements
The government-wide financial statements provide readers with a comprehensive, long-term view of the City’s financial position and operations. These statements are prepared using the economic resources measurement focus and the accrual basis of accounting methods similar to those used by private-sector entities. Under this basis, revenues and expenses are recognized in the period in which they are earned or incurred, regardless of when cash is received or disbursed. In addition, certain interfund receivables, payables, and interfund activities are eliminated to avoid overstating the City’s overall financial position.

Fund Financial Statements
These statements provide readers with more detailed information about the City’s major funds, including how current services were financed in the short term and the fund balances available to support future projects. Most City funds—other than the General Fund and the Internal Service Funds are subject to significant legal or contractual restrictions, commitments, or other limitations that affect the extent to which their resources may be used for future purposes.

Notes to the Financial Statements
These notes provide essential context and additional detail to help readers better understand the information presented in both the Government-Wide Financial Statements and the Fund Financial Statements.

In addition to the basic financial statements and accompanying notes, this report includes Required Supplementary Information that presents the City’s progress in funding its pension and retiree health benefit obligations. Following the required supplementary information are the combining statements for the City’s non-major governmental funds and internal service funds.

Financial Highlights
At the end of FY 2024–25, the City’s assets plus deferred outflows exceeded its liabilities plus deferred inflows, resulting in a net position of $672 million. Within this total, the unrestricted net position was –$41 million, reflecting the impact of the City’s $249 million net pension liability, as well as increases in compensated absences and claims liabilities. Total long-term liabilities decreased by $6 million, primarily due to scheduled annual debt service payments on the City’s Pension Obligation Bonds and Utility Water Revenue Bonds. Assets increased by $18 million, driven largely by additional Gas Tax funding, an $8 million repayment from the Successor Agency, and increased reserves in the Internal Service Funds for future vehicle replacements and information technology projects. As of fiscal year-end, the City’s governmental funds reported a combined ending fund balance of $256 million, consisting of the following components (see Note 13 for further detail):

Fund Balance Component Amount (in millions)
Non-spendable $1
Restricted by Outside Parties/Obligations, land held for redevelopment and loans 176 Committed for 20% Operating Reserve, Future Development Projects and Pension Stabilization Plan 56 Assigned for Debt Service on Pension Bonds and future capital project costs 8 Unassigned 15
Total Fund Balance at June 30, 2025 $256

City of Fairfield, California
Management Discussion and Analysis
5 Government-Wide Financial Analysis
The City’s Statements of Net Position for fiscal years 2025 and 2024 are presented below, with descriptions of the major components included in the Statements (in millions):
2025 2024 2025 2024 2025 2024
Current and other assets $ 400 $ 386 $ 129 $ 133 $ 529 $ 519 Capital assets 382 377 169 166 551 543
Total assets 782 763 298 299 1,080 1,062
Total deferred outflows of resources 56 72 8 7 64 79
Current and other liabilities 40 41 13 14 53 55
Long term liabilities 283 288 118 119 401 407
Total liabilities 323 329 131 133 454 462
Total deferred inflows of resources 15 15 3 3 18 18
Net position:

Net investment in capital assets 365 359 115 110 480 469 Restricted 197 192 36 33 233 225
Unrestricted (62) (60) 21 27 (41) (33)
Total net position $ 500 $ 491 $ 172 $ 170 $ 672 $ 661
Summary Statements of Net Position (in millions)
Governmental Activities Business-Type Activities Totals • Current and Other Assets
This category includes unrestricted cash and investments, as well as other short-term resources such as receivables, inventory, land held for development, and prepaid items that are expected to be converted into cash or used within one year.
• Capital Assets
This category includes land, buildings, improvements, infrastructure, vehicles, equipment, and right-to-use assets. These long-term assets are used to provide services to the community and are not available for future spending. • Current and Other Liabilities
This category represents obligations that are expected to be settled using current assets, typically within one year. • Long Term Liabilities
This category includes the City’s outstanding obligations that extend beyond one year, such as long-term pension and Other Post-Employment Benefits (OPEB) liabilities, compensated absences, leases, subscription agreements, outstanding claims, and bonded debt.
• Net Position
Net investment in capital assets represents the City’s capital assets, net of accumulated depreciation and amortization and any related outstanding debt. Restricted net position is subject to externally imposed limitations for specific purposes, such as capital projects, debt service, and community development, and is not available for general operations.

Unrestricted net position is available for general use. The deficit reported in Governmental Activities primarily reflects the City’s outstanding pension obligations.

City of Fairfield, California
Management Discussion and Analysis
6 Government-Wide Financial Analysis (Continued)
The Statement of Activities indicates that the City’s total net position increased by $11 million during FY 2024–25. This growth is primarily attributable to increases in capital and other assets across the City. Key capital contributions for both Governmental and Business-Type Activities include projects such as the Downtown Streetscape, enhancing driver and pedestrian safety; Allan Witt Park playground and restroom renovations; and the acquisition of four electric buses along with supporting infrastructure for the Transit Department.

The City’s Statements of Activities for FY 2025 and 2024 (in millions) are presented below:
2025 2024 2025 2024 2025 2024
Revenues:

Program Revenues:

Charges for services $ 16 $ 12 $ 60 $ 57 $ 76 $ 69
Operating grants and contributions 27 28 11 11 38 39
Capital grants and contributions 31 37 5 12 36 49
General Revenues:

Property taxes 47 41 47 41
Sales and transaction taxes 57 56 57 56
Other taxes 21 20 21 20
Other Revenues 23 24 6 5 29 29
Total revenues 222 218 82 85 304 303
Expenses:

Administration 17 13 17 13
Finance 2 2 2 2
Police 66 68 66 68
Fire 38 38 38 38
Public works 54 58 54 58
Community development 8 11 8 11
Housing 17 16 17 16
Parks and recreation 10 9 10 9
Interest on long term debt 1 1 1 1
Water utility 46 42 46 42
North bay treatment plant 12 11 12 11
Transportation 12 12 12 12
Golf courses 10 9 10 9
Total expenses 213 216 80 74 293 290
Increase (decrease) in net position 9 2 2 11 11 13
Net position July 1 491 489 170 159 661 648
Net position June 30 $ 500 $ 491 $ 172 $ 170 $ 672 $ 661 Summary Statements of Activities (in millions)
Governmental Activities Business-Type Activities Totals

City of Fairfield, California
Management Discussion and Analysis
7 Government-Wide Financial Analysis (Continued)
Revenues consist of charges for services provided to the public, such as water utility fees, as well as grants and contributions from other governments and organizations that support the operating and capital costs of specific programs. Revenues also include taxes, including property, sales and transaction, franchise, transient occupancy, and business license taxes. Expensesreflect the costs of providing a broad range of City services, including Administration (City Council, City Manager, Human Resources, Information Technology, and contract City Attorney services), Finance (including Risk Management), Police, Fire, Public Works, Community Development (Planning, Building, and Economic Development), Housing, Parks and Recreation (including Adult and Youth Activities and Aquatics), the City’s two golf courses, the North Bay Water Treatment Plant, Water Utility operations, and Transportation services.

Governmental Activities
The total cost of providing all governmental activities in FY 2024– 25 was $213 million, with program revenues covering $74 million (35%), resulting in a net cost of $139 million. The remaining costs were funded through taxes some of which are restricted for specific purposes and other revenues, including interest earnings, general entitlements, property sales, and interfund transfers.

The overall cost of services decreased by $3 million, primarily reflecting cost-saving measures implemented during FY 2024–25 to help reduce the City’s ongoing budget deficit. Expenditure in Internal Service Funds decreased by $1.6 million, while Special Revenue Fund expenditures declined by $2.6 million.

The table below summarizes the total and net costs of
Governmental Activities.
2025 2024 2025 2024
Administration and Finance $ 19 $ 15 $ 17 $ 10
Police 66 68 63 63
Fire 38 38 31 30
Public works 54 58 14 23
Community development 8 11 5 8
Housing 17 16 3 1
Parks and recreation 10 9 5 3
Interest on long term debt 1 1 1 1
Total $ 213 $ 216 $ 139 $ 139
Net Program Cost/(Revenue) of Governmental Activities (in millions) Total Cost Net Cost/(Revenue)
of Services of Services
25%
12%
15% 12%
19%
7%
10%
Government-Wide Revenues by Source
- $304 Million
Charges for services
Operating grants /
contributions
Capital grants /
contributions
Property taxes
Sales / transaction
taxes
Other taxes
6%
1% 3%
3%
23%
13%
4%
16%
4%
18%
3%
6%
Government-Wide Expenses by Source
- $293 Million
Administration
Finance
Golf courses
Other
Police
Fire
North bay plant
Water utility
Transportation
Public works
Parks and recreation
Housing

City of Fairfield, California
Management Discussion and Analysis
8 Government-Wide Financial Analysis (Continued)
Business-Type Activities
For FY 2024–25, the total cost of all Business-Type Activities was $80 million. As reported in the Statement of Activities, user charges for services totaled $60 million, while operating and capital grants and contributions amounted to $16 million, primarily supporting the City’s Transportation and Water Utility systems. This generated total program revenues of $76 million, offsetting most of the cost of these activities.

Net position for Business-Type Activities increased by $2 million, including investment earnings and transfers, resulting in a total net position of $172 million. The net program revenues presented below exclude investment income and transfers, as these are reported as general revenues for Business-Type Activities.
$0
$10
$20
$30
$40
$50
Water Utility North Bay Plant Transportation Golf Courses 2025 Revenue $40.6 $11.9 $13.3 $10.2
2025 Expense $46.0 $11.6 $12.3 $10.4
$40.6
$11.9 $13.3
$10.2
$46.0
$11.6 $12.3 $10.4
Revenues vs Expenses Business-Type Activities
(in millions)
2025 2024 2025 2024
Water utility $ 46 $ 42 $ 5 $ 1
North bay treatment plant 12 11 - (2)
Transportation 12 12 (1) (5)
Golf courses 10 9 - -
Total $ 80 $ 74 $ 4 $ (6)
Net Program Cost/(Revenue) of Business-Type Activities (in millions) Total Cost Net Cost/(Revenue)
of Services of Services

City of Fairfield, California
Management Discussion and Analysis
9 Financial Analysis of the City’s Funds
The Fund Financial Statements offer a more detailed view of the City’s operations by examining individual areas of the governmental and proprietary funds. They complement the broader overview provided by the Government-Wide Financial Statements, highlighting how resources are allocated and used in specific areas of the City’s operations.

Governmental Funds
The City’s governmental funds provide information on the near-term inflows, outflows, and balances of spendable resources.

As of June 30, 2025, the City’s governmental funds reported a combined fund balance of $256 million, reflecting an increase of $6 million compared to the end of the previous fiscal year. The major changes are explained below.

General Fund: The City’s primary operating fund experienced an decrease of $58 thousand in fund balance. Additional details are provided in the General Fund Budgetary Highlights section of the MD&A.

Low/Mod Income Housing Fund: Fund balance decreased by $1.7 million due to financial assistance provided to various agencies for homeless sheltering services and support for the Section 8 program.

Capital Projects Fund: Fund balances declined by $2.0 million, reflecting the use of intergovernmental revenues, transfers from other funding sources, and prior fund balances to finance project costs instead of relying solely on developer fees collected during the year. Major projects included the Downtown Streetscape to enhance driver and pedestrian safety, Allan Witt Park playground and restroom renovations, construction of the new North Texas Recreation Center and park, and the City’s Energy Efficiency project, which is expected to generate future energy savings across City facilities.

Other Governmental Funds: Fund balances increased by $10.0 million, primarily due to collections of gas taxes, development fees and impact fees, maintenance district funds, and special assessments levied for future City projects that have not yet commenced
Proprietary Funds
The City’s proprietary funds provide information similar to that presented in the Government-Wide Financial Statements, but with additional detail on individual funds. The financial results and factors affecting these funds have been previously discussed in the Business-Type Activities section of the Government-Wide Statements.

General Fund Budgetary Highlights
During the fiscal year, the City Council revised the City’s budget to account for changes in revenues and expenditures. After these adjustments, General Fund revenues exceeded the final budget by $5.8 million (4.1%), primarily due to higher-thanexpected sales and property taxes, charges for services, and investment income.

A significant portion of General Fund revenue is derived from Measure P, a 1% local transaction and use tax implemented on April 1, 2013, and set to expire in 2033. Revenue from Measure P is dedicated to protecting public safety, maintaining City services, enhancing quality of life, and improving the City’s infrastructure.

The largest revenue increase came from property taxes, including motor vehicle taxes, which rose by $6.3 million (16%). This growth was driven by new development, increased property values, and a significant adjustment from the County correcting previously uncollected assessed taxes. Sales taxes increased by $890,363 (2.9%), reflecting renewed economic activity, particularly in building, construction, and restaurant sectors within the City.

Charges for services exceeded budget by $698 thousand, with notable increases in Planning and Building fees ($301,139) and Fire Department fees ($765,861), largely due to one-time, prior-year’s collection of emergency response and first responder fees. These gains were partially offset by a decrease in Public Works development review fees, reflecting a slowdown in new development.

City of Fairfield, California
Management Discussion and Analysis
10 General Fund Budgetary Highlights (Continued)
$47
$32
$25
$13
$8 $8
$4
$9
$
$5
$10
$15
$20
$25
$30
$35
$40
$45
$50
Property Taxes
32%
Sales Tax 22% Measure P
Taxes 17%
Utility /
Franchise
Taxes 9%
Other Taxes
5%
Charges for
Services 5%
Licenses,
Permits &
Fines 3%
Other 6%
General Fund Revenues by Category
Fiscal Year 24-25
General Fund expenditures, including transfers out, were over budget by $620,551 or 0.4%. However, after considering the subsidy as explained below, the General fund was under budget by $1.9 million, or 1.3%. An additional $2.5 million subsidy from the Intergovernmental Fund to cover the Information Technology charges in the General Fund had been authorized in the budget if needed. However, due to stronger revenues and lower expenditures during the year, management elected to use current-year resources to cover all costs, thereby preserving these one-time funds for future needs. $60
$34
$17
$19
$5 $7 $6
$1
General Fund Expenditures by Department
Fiscal Year 24-25
Police 40%
Fire 23%
Admin / Non Dept 11%
Public Works 13%
Transfers Out 3%
Recreation 5%
Community Development 4%
Capital Outlay/Debt Service 1%

City of Fairfield, California
Management Discussion and Analysis
11 Capital Assets
Capital Assets
As of June 30, 2025, the City’s investment in capital assets for both governmental and business-type activities totaled $552 million (net of accumulated depreciation and amortization). This investment includes land, buildings and improvements, equipment, vehicles, machinery, infrastructure, right-to-use assets, and work in progress. Total capital assets increased by

1.6% during the fiscal year.

The City adopted a Capital Improvement Program (CIP) of $92.7 million for FY 2024–25 and $52.1 million for FY 2025–26. For additional information on major upcoming projects, see the Economic Factors and Next Year’s Budget section. A detailed listing of all capital assets for governmental and business-type activities is provided in Note 6.

Accumulated
Cost
Depreciation/
Amortization
Carrying
Amount
Governmental Activities:

Land / Intangibles $ 48 $ 48
Buildings and Improvements 320 $ (127) 193
Equipment, Vehicles, Machinery 63 (42) 21
Infrastructure 332 (245) 87
Right to Use Assets 20 (8) 12
Work in Progress 22 22
Total Governmental Activities $ 805 $ (422) $ 383
Business-Type Activities:

Land / Intangibles $ 20 $ 20
Buildings and Improvements 88 $ (57) 31
Equipment, Vehicles, Machinery 40 (32) 8
Infrastructure 230 (134) 96
Work in Progress 14 14
Total Business-Type Activities $ 392 $ (223) $ 169
Summary of Capital Assets (in millions)
Major capitalized projects in FY 24-25 include:
• Downtown Streetscape - $1.5 million
• Allan Witt Park Renovations - $4.7 million
• PAL Center - $1.8 million
• Grange Middle School SR2S - $1.7M
• 4 Electric Buses - $657 thousand
12%
41%
5%
33%
2%
7%
Total Capital Assets by Type - At Net
Land / Intangibles
Buildings and Improvements
Equipment, Vehicles, Machinery
Infrastructure
Right to Use Assets
Work in Progress

City of Fairfield, California
Management Discussion and Analysis
12 Bonded Debt and Other Long-Term Obligations
The City maintains strong credit ratings on all outstanding debt. Standard & Poor’s has assigned an AA rating to the City’s Pension Obligation Bonds (AAA being the highest rating). The graph below illustrates the City’s long-term obligations (in millions).

The City’s net OPEB liability, which covers retiree health and dental benefits, totals $162,648. To address this liability, the City allocated $3.0 million to an internal service fund and established an irrevocable trust in March 2018. The net OPEB liability relates to a closed plan with 21 members, based on an actuarial study, assuming a long-term return rate of 5.25%. Health costs are projected to increase annually at 8.0% until stabilizing at 3.9%, while dental costs are expected to rise at 3.0% per year. For additional details on the City’s net OPEB liability, see Note 15.

During FY 2024–25, the City’s longterm debt and obligations for governmental activities decreased
by $5 million, bringing the
outstanding balance to $298
million as of June 30, 2025. This
decrease reflects a $2 million
reduction in the net pension
liability due to CalPERS’ positive
investment returns in FY 2023–24,
as well as a $2 million payment on
the Pension Obligation Bonds.

Long-term obligations for businesstype activities decreased by $1 million, totaling $122 million,
primarily due to scheduled debt
payments during the fiscal year.

For a detailed listing of the City’s
outstanding obligations, see Notes
8, 9, 10, 11, and 14 in the Notes to
the financial Statements section.
2025 2024 2025 2024 2025 2024
General Obligation Bonds $ 5 $ 5 $ 5 $ 5
Pension Obligation Bonds 22 24 22 24
Utility-Water Revenue Bonds $ 88 $ 92 88 92
Total City Bonded Debt $ 27 $ 29 $ 88 $ 92 $ 115 $ 121
Compensated Absences 23 22 3 3 26 25
Claims and Judgments 20 19 20 19
Leases and Subscriptions 9 12 1 10 12
Net Pension Liability 219 221 30 28 249 249
Total City Obligations $ 271 $ 274 $ 34 $ 31 $ 305 $ 305 Total City Debt and Obligations $ 298 $ 303 $ 122 $ 123 $ 420 $ 426 Governmental Activities Business-Type Activities Total
Summary of Long-Term City Bonded Debt and Obligations (in millions) 1%
5%
21%
6%
5%
3%
59%
Long Term City Debt and Obligations by Type
General Obligation Bonds
Pension Obligation Bonds
Utility-Water Revenue Bonds
Compensated Absences
Claims and Judgments
Leases and Subscriptions
Net Pension Liability

City of Fairfield, California
Management Discussion and Analysis
13 Economic Factors and Biannual Budget
The City prepares a two-year budget aligned with council-defined goals and priorities, incorporating a multi-year financial plan to promote long-term fiscal stability and provide decision-makers with insight into the financial impact of policy choices.

The budget is guided by policies established by the City Council, which address long-term planning, minimum reserve levels, employee compensation, cash and debt management, information technology, and utility rates. Key assumptions underlying the budget include:

Tax Revenues – Projections for property tax, sales and use tax, and Measure P (transaction and use tax) are provided by HdL Companies as part of their tax auditing services. These estimates are informed by the current national economic outlook.

Projections related to development activity are provided by the City’s Community Development staff and are based on projects that have been approved or are actively progressing through the entitlement process.

Property Tax - The City continues to experience impacts from Solano County’s transition to a new property tax system, particularly in the valuation of subdivided properties and delays in processing supplemental assessments. These delays create timing differences between when revenue is anticipated and when cash is actually received.

Additionally, property owned by the CSCDA Community Improvement Authority has been reclassified from government use to possessory interest. Solano County and several other agencies maintain that possessory interest tax bills should be issued to apartment complexes, requiring owners to pay taxes on units that would otherwise be exempt if held by a non-government entity. Many of these properties were acquired as market-rate apartments, and some tenants are not low-income renters.

The impact of this change is reflected in the City’s revenue projections.

For the FY 2025–26 assessment roll, residential property values increased by 6.1%, while commercial property values rose by

2.9%; both are incorporated into the FY 2025–26 projections. A slowdown in property sales and declining prices is expected to reduce growth in FY 2026–27, with recovery projected in subsequent years at an estimated 4.5% annual growth.

Utility and Franchise Taxes – The City imposes a 2% Utility Users Tax on all residential and commercial utility bills within City limits. In addition, franchise agreements with utility providers generate revenue based on a percentage of their earnings within the City. These fees help offset infrastructure impacts, such as street wear and maintenance. Revenue levels fluctuate based on customer growth, service usage, weather conditions, and rate adjustments. Based on historical trends and current agreements, a 2.5% increase in Utility and Franchise Tax revenue is projected for both FY 2025–26 and FY 2026–27.

Motor Vehicle in Lieu Tax/Other Taxes – The Vehicle License Fee (VLF) is a statewide tax on registered vehicle ownership that replaced personal property vehicle taxes. VLF revenues support city and county services; however, the State Legislature controls the rate and allocation. In 2004, the Legislature reduced the VLF rate and ended the State general fund backfill. Cities and counties now receive additional property tax transfers in lieu of VLF, which are classified as property taxes. Growth in VLF revenue is tied to changes in the City’s assessed property values from the prior year, and FY 2025–26 projections align with secured property tax growth from FY 2024–25. The City also imposes a Transient Occupancy Tax (TOT), which increased from 10% to 12% in November 2024 for stays of 30 days or less; this increase is reflected in current projections. In addition, a business license update was approved in November 2024, and its impact is incorporated into current revenue projections.

Sales Taxes and Local Measure P Sales and Use Taxes – The total sales tax rate in Fairfield is 8.375%, which includes a 1% local portion, a 1% Measure P local use tax, and a half-cent tax (Proposition 172) approved in 1993 for public safety, shared between the cities and the County. Statewide, sales tax revenues have slowed due to high interest rates, inflation, and reduced consumer confidence, which have constrained discretionary spending. As a result, minimal growth is projected for FY 2025–26 and approximately 3% annual growth anticipated from FY 2026–27 onward.

Locally, the addition of a new auto dealership in FY 2024–25 contributed to positive growth in Fairfield’s auto sector; however, sales are expected to remain flat in FY 2025–26 due to continued high interest rates and weak consumer confidence.

City of Fairfield, California
Management Discussion and Analysis
14 Economic Factors and Biannual Budget (Continued)
Building & Construction: Slowing housing starts and reduced construction activity are expected to result in a 2% decline in FY 2025–26, with a recovery anticipated in FY 2026–27. Business & Industry: Growth in FY 2024–25 was strong due to new business openings and robust performance from existing businesses. A slowdown is projected in FY 2025–26, reflecting broader economic conditions. Restaurants & Hotels: Consumer spending on dining and lodging remains strong, and moderate growth is projected for this sector.

Personnel costs – Projections are based on current staffing levels and a 5% vacancy savings rate, excluding the Fire Department, which has historically maintained full staffing. Existing labor agreements expired on June 30, 2025, and potential impacts from future agreements are not included. Beginning in FY 2028-29, a 2% annual COLA is assumed in the forecast.

Health Costs – The City’s health care costs are projected to increase by 6% in FY 2025-26, with the same annual growth assumed through FY 2026-27 and beyond. The budget assumes equal cost-sharing of premium increases between the City and employees for the next two years, except for one bargaining unit with a 95% City/5% employee split.

Pension Costs – Pension rates for FY 2025–26 are based on information provided by CalPERS. The City has incorporated the FY 2023–24 investment performance of 9.3%, which will begin impacting the budget in FY 2026–27. Staff projections assume that CalPERS will achieve its 6.8% long-term target return; any deviation from this target could affect future pension costs and the long-term financial forecast.

Internal Service Funds (ISF’s) Funding – Ongoing funding to the City’s Internal Service Funds (ISFs) is included in the budget to maintain adequate operational levels and reserves for insurance claims, leave payouts, and internal services such as information technology and vehicle replacement.

Next Year’s Capital Improvement Program
The City’s adopted Capital Improvement Program (CIP) for FY 25-26 and FY 26-27 totals $52.1 million and $40.3 million, respectively. The CIP is designed to meet community needs, with special emphasis on those projects that contribute to the City’s economic vitality and quality of life, Annual Street Pavement Maintenance, Midtown Sewer Replacement, West Texas Complete Streets, Jepson Parkway, Lopes Road & Waterline Reconstruction, as well as improvements at Linear Park Node 4 and other community and neighborhood parks.

City of Fairfield, California
Management Discussion and Analysis
15 Economic Factors and Biannual Budget (Continued)
The table below summarizes major projects planned for the next two fiscal years (in millions):

Contacting the City’s Financial Management
This Annual Comprehensive Financial Report (ACFR) is designed to provide a general overview of the City’s finances. This report can be obtained at no cost from the City’s website at https://www.fairfield.ca.gov/government/citydepartments/finance/financial-reports. If you have questions about this report or need any additional financial information, contact the City’s Finance Department at 1000 Webster Street, Fairfield, CA 94533, phone 707-428-7567.

Category Name of Project
Estimates
FY 25-26
Estimates
FY 26-27
Parks Linear Park Node 4 Trail from North Texas to Dover 0.1 3.9 Sewer Midtown Sewer Replacement Project 1.8 1.8
Streets 2026 Rancho Solano Pavement Maintenance 2.4 -
E. Tabor/Tolenas SR2S Gap Closure 2.3 -
Pavement Maintenance Project 5.9 3.8
Pavement Maintenance Operations 2.2 2.3
Utility Undergrounding: Webster & Empire Street 3.0 3.2 West Texas Complete Streets Project 6.0 -
Jepson Parkway Segment 19 4.1 3.7
Water Advanced Metering Infrastructure (AMI) Implementation 2.2 7.2 Lopes Road & Water Pipeline (2023 Storm Damage) 3.8 -
Hale Ranch Road Transmission Main Replacement 3.5 0.1
Waterman Reservoir Valve and Mixing Improvement 1.7 0.1

City of Fairfield, California
Government-Wide Financial Statements
16 Page 411 of 968
City of Fairfield, California
Statement of Net Position
June 30, 2025
The notes to the basic financial statements are an integral part of this statement. 17 Governmental Business-type
Activities Activities Total
Assets:

Cash and investments (Notes 1D and 4) $ 296,721,974 $ 78,690,567 $ 375,412,541 Receivables, net (Note 5) 86,040,218 18,277,711 104,317,929 Inventory (Note 1G) 815,550 299,287 1,114,837
Prepaid items (Note 1G) 528,311 528,311
Restricted cash and investments (Notes 1E and 4) 7,765,098 32,713,615 40,478,713 Land held for development (Note 1Q) 7,154,809 7,154,809 Internal balances (Note 3) 1,124,382 (1,124,382)
Investment in joint agencies (Note 1H) 525,561 525,561
Capital assets (Notes 1I and 6):

Nondepreciable 69,909,507 33,623,780 103,533,287
Depreciable/amortizable, net 312,635,093 135,332,582 447,967,675 Total capital assets 382,544,600 168,956,362 551,500,962 Total assets 782,694,942 298,338,721 1,081,033,663
Deferred Outflows of Resources (Note 1J):

Deferred charge on refunding 1,190,762 1,190,762
Deferred outflows related to OPEB (Note 1L and 15) 90,240 90,240 Deferred outflows related to pensions (Notes 1K and 14) 55,014,161 7,553,899 62,568,060 Total deferred outflows of resources 56,295,163 7,553,899 63,849,062 Liabilities:

Accounts payable and other current liabilities (Note 7) 24,147,987 8,507,300 32,655,287 Interest payable 78,018 296,052 374,070
Unearned revenue (Note 1R) 935,019 595,231 1,530,250
Long-term obligations (Note 8):

Due within one year 14,969,699 3,978,912 18,948,611
Due in more than one year 283,061,925 117,942,788 401,004,713 Total liabilities 323,192,648 131,320,283 454,512,931
Deferred Inflows of Resources (Note 1J):

Deferred inflows related to pensions (Notes 1K and 14) 1,023,914 1,093,317 2,117,231 Deferred inflows related to leases (Notes 1N and 9) 14,349,020 1,919,950 16,268,970 Total deferred inflows of resources 15,372,934 3,013,267 18,386,201 Net Position (Note 12):

Net investment in capital assets 365,711,524 114,560,857 480,272,381 Restricted for:

Capital projects 78,621,551 78,621,551
Debt service 1,019,984 1,019,984
Community development and housing 60,232,354 60,232,354 Special projects 57,017,787 57,017,787
Major maintenance 35,657,353 35,657,353
Minority interest 282,495 282,495
Outreach independence:

Expendable 81,126 81,126
Nonexpendable 335,375 335,375
Total restricted 197,308,177 35,939,848 233,248,025
Unrestricted (deficit) (62,595,178) 21,058,365 (41,536,813) Total net position $ 500,424,523 $ 171,559,070 $ 671,983,593 Primary Government

City of Fairfield, California
Statement of Activities
For the Year Ended June 30, 2025
The notes to the basic financial statements are an integral part of this statement. 18 Program Revenues
Operating Capital
Charges for Grants and Grants and
Functions/Programs Expenses Services Contributions Contributions Total Primary government:

Governmental activities
Administration $ 17,450,107 $ 322,484 $ 491,567 $ 1,297,251 $ 2,111,302 Finance 1,951,049 636,931 10,454 647,385
Police 66,080,623 897,762 1,817,776 2,715,538
Fire 37,994,133 3,070,579 3,631,772 6,702,351
Public works 54,152,646 6,986,524 6,316,366 27,419,624 40,722,514 Community development 8,358,041 2,173,287 1,017,489 3,190,776 Housing 16,643,240 13,556,717 13,556,717
Parks and recreation 9,644,926 1,878,623 531,698 2,408,787 4,819,108 Interest on long-term debt 1,094,957 -
Total governmental activities 213,369,722 15,966,190 27,373,839 31,125,662 74,465,691 Business-type activities:

Water utility 46,011,373 37,561,861 3,076,440 40,638,301 North bay treatment plant 11,622,255 11,939,809 11,939,809 Transportation 12,301,400 379,458 11,416,980 1,524,174 13,320,612 Golf courses 10,387,077 10,153,273 10,153,273
Total business-type activities 80,322,105 60,034,401 11,416,980 4,600,614 76,051,995 Total primary government $ 293,691,827 $ 76,000,591 $ 38,790,819 $ 35,726,276 $ 150,517,686 General Revenues and Transfers:

Taxes:

Property taxes
Sales taxes
Transaction and use taxes
Franchise taxes
Utility user taxes
Transient occupancy taxes
Business license taxes
Other taxes
Total taxes
Unrestricted intergovernmental revenues
Investment earnings
Net increase in fair value of investments
Miscellaneous
Gain on disposition of capital asset
Transfers (Note 3)
Total general revenues and transfers
Change in net position
Net position - beginning of year
Net position - end of year

The notes to the basic financial statements are an integral part of this statement. 19 Governmental Business-Type
Activities Activities Total
$ (15,338,805) $ (15,338,805)
(1,303,664) (1,303,664)
(63,365,085) (63,365,085)
(31,291,782) (31,291,782)
(13,430,132) (13,430,132)
(5,167,265) (5,167,265)
(3,086,523) (3,086,523)
(4,825,818) (4,825,818)
(1,094,957) (1,094,957)
(138,904,031) (138,904,031)
$ (5,373,072) (5,373,072)
317,554 317,554
1,019,212 1,019,212
(233,804) (233,804)
- (4,270,110) (4,270,110)
(138,904,031) (4,270,110) (143,174,141)
47,135,699 47,135,699
31,739,380 31,739,380
24,721,724 24,721,724
7,935,194 7,935,194
5,283,671 5,283,671
3,406,652 3,406,652
2,668,552 2,668,552
1,980,611 1,980,611
124,871,483 124,871,483
1,146,527 1,146,527
12,127,472 4,515,065 16,642,537
4,538,837 1,639,560 6,178,397
4,506,038 186,672 4,692,710
272,983 272,983
397,779 (397,779) -
147,861,119 5,943,518 153,804,637
8,957,088 1,673,408 10,630,496
491,467,435 169,885,662 661,353,097
$ 500,424,523 $ 171,559,070 $ 671,983,593
and Changes in Net Position
Net (Expense) Revenue

City of Fairfield, California
People and Places in the City
20 Page 415 of 968
City of Fairfield, California
Governmental Funds Financial Statements
.
21 Page 416 of 968
City of Fairfield, California
Balance Sheet
Governmental Funds
June 30, 2025
The notes to the basic financial statements are an integral part of this statement. 22 General Low Mod
Fund Income Housing
Assets:

Cash and investments (Notes 1D and 4) $ 47,961,652 $ 3,276,916 Receivables, net (Note 5) 29,740,898 31,055,388
Prepaid items (Note 1G) 144,536 2,905
Restricted cash and investments (Notes 1E and 4) 7,765,098 Land held for development (Note 1Q) 5,050,680
Total assets $ 85,612,184 $ 39,385,889
Liabilities:

Accounts payable and other current liabilities (Note 7) $ 11,961,686 $ 133,528 Advances from other funds (Note 3)
Due to other funds (Note 3)
Unearned revenues (Note 1R) 409,465 64,020
Total liabilities 12,371,151 197,548
Deferred Inflows Of Resources (Note 1J):

Lease related - (lessor) (Notes 1N and 9) 15,980,904
Unavailable revenue-receivables 3,084,657
Total deferred inflows of resources 15,980,904 3,084,657 Fund Balances (Notes 1P and 13):

Nonspendable 144,536 2,905
Restricted 7,879,759 36,100,779
Committed 33,522,093
Assigned 782,100
Unassigned 14,931,641
Total fund balances 57,260,129 36,103,684
Total liabilities, deferred inflows of
resources, and fund balances $ 85,612,184 $ 39,385,889
Major Funds

The notes to the basic financial statements are an integral part of this statement. 23 Total
Non-Major Total
City Governmental Governmental
Capital Projects Funds Funds
$ 62,565,462 $ 92,177,716 $ 205,981,746
4,066,889 19,752,489 84,615,664
36,726 184,167
7,765,098
5,050,680
$ 66,632,351 $ 111,966,931 $ 303,597,355
$ 9,375,951 $ 1,790,762 $ 23,261,927
598,200 598,200
444,461 444,461
130,240 331,294 935,019
9,506,191 3,164,717 25,239,607
15,980,904
3,552,561 6,637,218
- 3,552,561 22,618,122
372,101 519,542
51,167,182 80,800,335 175,948,055
22,539,691 56,061,784
5,958,978 1,537,526 8,278,604
14,931,641
57,126,160 105,249,653 255,739,626
$ 66,632,351 $ 111,966,931 $ 303,597,355
Major Funds

City of Fairfield, California
Reconciliation of the Governmental Funds Balance Sheet to the Government-Wide Statement of Net Position
June 30, 2025
The notes to the basic financial statements are an integral part of this statement. 24 Reconciliation Statement of N
Total Fund Balances - Total Governmental Funds $ 255,739,626 Amounts reported for Governmental Activities in the Statement of Net Position are different because:

Capital assets used in governmental activities are not current financial resources and therefore are not reported in the Governmental Funds Balance Sheet. Except for the Internal Service Funds amount of $25,064,699, the capital assets were as follows:

Nondepreciable Assets 68,701,030
Depreciable/amortizable Assets, net 288,778,871
Total Capital Assets, net of accumulated depreciation/amortization 357,479,901 Interest payable on long-term debt does not require current financial resources. Therefore, interest payable is not reported as a liability in the Governmental Funds Balance Sheet. (78,018) Internal Service Funds are used by management to charge the costs of certain activities, such as insurance and fleet management, to individual funds. The assets, deferred outflows/inflow of resources, and liabilities of the Internal Service Funds are included in governmental activities in the Government-Wide Statement of Net Position. 75,542,787 Deferred inflows recorded in governmental fund financial statements resulting from activities in which revenues were earned but funds were not available, were recognized as revenues in the Government-Wide Financial Statements. 6,637,218 Deferred inflows related to lease revenue are not reported in the Governmental Funds but are recognized as revenue in the Government-Wide Statements. 1,631,884 Deferred outflows related to pensions are only reported in the Government-Wide Statement of Net Position. 55,014,161
Deferred inflows related to pensions are only reported in the Government-Wide Statement of Net Position. (1,023,914)
Deferred charges on refunding of debt are not reported in the Governmental Funds Balance Sheet but are reported in the Government-Wide Statement of Net Position, and amortized over time. 1,190,762
Long-term liabilities are not due and payable in the current period and therefore they are not reported in the Governmental Funds Balance Sheet. Except for the Internal Service Funds amount of $46,321,740, the long-term liabilities were as follows:

Long-term liabilities - due within one year (3,010,423) Long-term liabilities - due in more than one year (248,699,461) Total long-term liabilities (251,709,884)
Net Position of Governmental Activities $ 500,424,523

City of Fairfield, California
People and Places in the City
25 Page 420 of 968
City of Fairfield, California
Statement of Revenues, Expenditures and
Changes in Fund Balances
Governmental Funds
For the Year Ended June 30, 2025
The notes to the basic financial statements are an integral part of this statement. 26 General Low Mod
Fund Income Housing
Revenues:

Property taxes $ 46,637,584
Sales taxes 31,739,380
Transaction and use taxes (Measure P) 24,721,724
Utility and franchise taxes 13,218,865
Other taxes 8,055,816
Development fees
Special assessments levied
Licenses, permits and fines 3,549,162
Developers' contributions
Intergovernmental 1,340,937 $ 668,955
Charges for services 8,425,429
Investment income 3,483,487 367,645
Net increase in fair value of investments 1,263,813 60,254 Miscellaneous 3,492,430 137,954
Total revenues 145,928,627 1,234,808
Expenditures:

Current:

Administration 6,964,458
Finance 1,560,077
Police 59,760,202
Fire 33,641,379
Public works 19,338,920
Parks and recreation 7,477,556
Community development 6,021,816
Housing services 2,266,679
Non-departmental 8,022,382
Capital outlay 272,604
Debt service:

Principal retirement 968,621 28,391
Interest 18,278 6,472
Fiscal agent fees
Total expenditures 144,046,293 2,301,542
Excess (deficiency) of revenues
over (under) expenditures 1,882,334 (1,066,734)
Other Financing Sources (Uses):

Issuance of Subscription-based IT arrangements (Notes 1O and 10) 246,604 Transfers in (Note 3) 2,655,000 45,000
Transfers out (Note 3) (4,842,347) (629,799)
Total other financing sources (uses) (1,940,743) (584,799) Net change in fund balances (58,409) (1,651,533)
Fund Balances:

Beginning of year 57,318,538 37,755,217
End of year $ 57,260,129 $ 36,103,684
Major Funds

The notes to the basic financial statements are an integral part of this statement. 27 Total
Non-Major Total
City Governmental Governmental
Capital Projects Funds Funds
$ 498,115 $ 47,135,699
31,739,380
24,721,724
13,218,865
3,210,919 11,266,735
$ 4,152,861 4,152,861
11,784,638 11,784,638
3,549,162
8,500 8,500
11,993,501 23,222,820 37,226,213
8,425,429
2,332,588 2,452,302 8,636,022
895,621 1,078,546 3,298,234
343,622 1,640,590 5,614,596
19,718,193 43,896,430 210,778,058
715,588 7,680,046
1,560,077
1,012,225 60,772,427
945,914 34,587,293
7,894,108 27,233,028
559,342 8,036,898
988,430 7,010,246
14,103,125 16,369,804
8,022,382
30,129,551 1,450,659 31,852,814
2,456,726 3,453,738
1,016,612 1,041,362
112,859 112,859
30,129,551 31,255,588 207,732,974
(10,411,358) 12,640,842 3,045,084
177,752 424,356
8,522,840 4,873,130 16,095,970
(84,607) (7,706,087) (13,262,840)
8,438,233 (2,655,205) 3,257,486
(1,973,125) 9,985,637 6,302,570
59,099,285 95,264,016 249,437,056
$ 57,126,160 $ 105,249,653 $ 255,739,626
Major Funds

City of Fairfield, California
Reconciliation of the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balance to the Government-Wide Statement of Activities
For the Year Ended June 30, 2025
The notes to the basic financial statements are an integral part of this statement. 28 Net Change in Fund Balances - Total Governmental Funds $ 6,302,570 Amounts reported for governmental activities in the Statement of Activities are different because:

Governmental Funds report capital outlay as expenditures in the amount of $31,852,814. In the GovernmentWide Statement of Activities, a portion of these expenditures, $18,227,806 are reported as capital assets.

Additional departmental assets were recorded at $5,964,062. 24,191,868 Depreciation and amortization expense on capital assets is reported in the Government-Wide Statement of Activities, but it does not require the use of current financial resources. Therefore, depreciation and amortization expense is not reported as an expenditure in Governmental Funds. Amount is net of the $6,529,299 in depreciation and amortization that is reported in the Internal Service Funds. (14,358,230) For capital assets, the gain or loss on the assets, if disposed of earlier, are not reported in Governmental Funds. 709
Repayment of lease principal is an expenditure in Governmental Funds, but the repayment reduces long-term liabilities in the Government-Wide Statement of Net Position. 516,903 Repayment of subscription principal is an expenditure in Governmental Funds, but the repayment reduces long-term liabilities in the Government-Wide Statement of Net Position. 544,945 Repayment of bond principal is an expenditure in Governmental Funds, but the repayment reduces long-term liabilities in the Government-Wide Statement of Net Position. 2,391,890 Issuance of long-tem debt is a revenue in Governmental Funds, but the issuance of long-term debt increases the long-term obligations in the Government-Wide Statement of Net Position. (424,356) Accrued interest expense on long-term debt is reported in the Government-Wide Statement of Activities, but it does not require the use of current financial resources. Therefore, accrued interest expense is not reported as an expenditure in Governmental Funds. This amount represents the change in accrued interest from prior year. 6,081
In the Governmental Funds, lessor lease revenue not meeting the availability criteria for revenue recognition are recorded as deferred inflows of resources. In the Government-Wide Statements, these amounts are recognized as income in a systematic and rational manner over the term of the lease. 443,621 Amortization expense (of Deferred Charges and Bond Issue Discount) is reported in the Government-Wide Statement of Activities, but it does not require the use of current financial resources. Therefore, amortization expense is not reported as expenditures in Governmental Funds. (156,938) In the Governmental Funds, receivables not meeting the availability criteria for revenue recognition are recorded as unavailable revenue. In the Government-Wide Statements, these amounts are recognized as income on the full accrual basis of accounting. 468,552 Internal Service Funds are used by management to charge the costs of certain activities, such as insurance and fleet management, to individual funds. The decrease in net position is reported with governmental activities. 3,847,440 The change in pension amounts are not a use of current financial resources and are not included in the net change in fund balances but are included in the net position of governmental activities. (14,817,967) Change in Net Position of Governmental Activities $ 8,957,088

City of Fairfield, California
Proprietary Funds Financial Statements
29 Budget Actual Housing Fund

City of Fairfield, California
Statement of Net Position
Proprietary Funds
June 30, 2025
The notes to the basic financial statements are an integral part of this statement. 30 North Bay
Water Treatment
Utility Plant Transportation
Assets:

Current Assets
Cash and investments (Notes 1D and 4) $ 69,452,952 $ 6,640,025 $ 204,037 Receivables, net (Note 5) 10,790,784 1,849,757 3,813,930 Inventory (Note 1G)
Prepaid items (Note 1G)
Due from other funds (Note 3)
Total current assets 80,243,736 8,489,782 4,017,967
Noncurrent Assets
Restricted cash and investments (Notes 1E and 4) 32,713,615 Advances to other funds (Note 3) 1,399,280
Investment in joint agencies (Note 1H) 525,561
Loans receivable (Note 5) 1,544,458
Land held for development (Note 1Q)
Capital assets: (Notes 1I and 6)
Nondepreciable 19,262,611 714,651 1,456,824
Depreciable/amortizable 238,636,221 68,192,905 31,219,671 Less: accumulated depreciation/amortization (144,258,146) (37,302,157) (22,774,078) Total capital assets 113,640,686 31,605,399 9,902,417
Total noncurrent assets 114,166,247 67,262,752 9,902,417 Total assets 194,409,983 75,752,534 13,920,384
Deferred Outflows of Resources (Note 1J):

Deferred outflows related to OPEB (Note 15)
Deferred outflows related to pension (Note 14) 5,719,801 1,311,743 522,355 Total deferred outflows of resources 5,719,801 1,311,743 522,355 Liabilities:

Current Liabilities
Accounts payable and other current liabilities (Note 7) 2,745,252 704,380 3,505,073 Due to other funds (Note 3) 1,124,382
Accrued interest payable 296,052
Accreted interest payable (Note 8) 788,746
Unearned revenue (Note 1R) 75,483
Compensated absences (Note 8) 91,372 42,749 6,815
Claims and judgments payable (Notes 8 and 11)
Bonds, leases, and subscriptions - due within one year (Note 8) 2,875,410 94,133 Total current liabilities 6,796,832 747,129 4,805,886
Noncurrent Liabilities
Advances from other funds (Note 3) 1,399,280
Accreted interest payable (Note 8) 34,654,747
Compensated absences (Note 8) 1,736,045 812,228 129,492 Claims and judgments payable (Notes 8 and 11)
Net pension liability (Note 14) 20,533,434 6,769,434 2,630,141 Net OPEB liability (Note 15)
Bonds, leases, and subscriptions - due in more than one year (Note 8) 50,314,699 316,315 Total noncurrent liabilities 108,638,205 7,581,662 3,075,948 Total liabilities 115,435,037 8,328,791 7,881,834
Deferred Inflows of Resources (Note 1J):

Deferred inflows related to pensions (Note 14) 292,578 423,896 376,843 Deferred inflows related to leases (Notes 9) 1,919,950
Total deferred inflows of resources 2,212,528 423,896 376,843 Net Position (Note 12 and 19):

Net investment in capital assets 60,060,406 31,605,399 9,491,969 Restricted for major maintenance 35,657,353
Restricted for minority interest 282,495
Unrestricted (deficit) 22,421,813 766,343 (3,307,907)
Total net position $ 82,482,219 $ 68,311,590 $ 6,184,062 Business-type Activities - Enterprise Funds
Major Funds

The notes to the basic financial statements are an integral part of this statement. 31 Non-Major
Total
Enterprise Internal
Golf Courses Funds Service Funds
$ 2,393,553 $ 78,690,567 $ 90,740,228
278,782 16,733,253 1,424,554
299,287 299,287 815,550
- 344,144
- 1,568,843
2,971,622 95,723,107 94,893,319
32,713,615
1,399,280 598,200
525,561
1,544,458
2,104,129
12,189,694 33,623,780 1,208,477
20,406,090 358,454,887 55,969,902
(18,787,924) (223,122,305) (32,113,680)
13,807,860 168,956,362 25,064,699
13,807,860 205,139,276 27,767,028
16,779,482 300,862,383 122,660,347
90,240
7,553,899
- 7,553,899 90,240
1,552,595 8,507,300 886,060
1,124,382
296,052
788,746
519,748 595,231
140,936 5,959,065
4,611,802
79,687 3,049,230 1,388,409
2,152,030 14,501,877 12,845,336
1,399,280
34,654,747
2,677,765 17,575,055
15,499,198
29,933,009
162,648
46,253 50,677,267 1,125,563
46,253 119,342,068 34,362,464
2,198,283 133,843,945 47,207,800
1,093,317
1,919,950
- 3,013,267 -
13,403,083 114,560,857 22,550,727
35,657,353
282,495
1,178,116 21,058,365 52,992,060
$ 14,581,199 $ 171,559,070 $ 75,542,787
Governmental
Activities

City of Fairfield, California
Statement of Revenues, Expenses and Changes in Net Position Proprietary Funds
For the Year Ended June 30, 2025
The notes to the basic financial statements are an integral part of this statement. 32 North Bay
Water Treatment
Utility Plant Transportation
Operating Revenues:

Charges for services $ 36,095,241 $ 11,906,236 $ 321,170 Insurance Recovery
Miscellaneous 1,466,620 33,573 58,288
Total operating revenues 37,561,861 11,939,809 379,458
Operating Expenses:

Material and supplies
Operating and maintenance 29,190,154 8,491,629 8,871,430 General and administrative 5,065,695 1,441,577 2,022,863 Insurance claims and premiums
Depreciation and amortization 7,566,664 1,689,049 688,237 Total operating expenses 41,822,513 11,622,255 11,582,530 Operating income (loss) (4,260,652) 317,554 (11,203,072) Nonoperating Revenues (Expenses):

Investment income 3,023,091 1,395,768 31,031
Net increase in fair value of investments 1,044,159 572,627 5,101 Interest expense (4,188,860)
Intergovernmental revenue 11,416,980
Gain (loss) on disposition of capital assets (33,369)
Other revenue (expense) 158,639 (685,501)
Total nonoperating revenues (expenses) 37,029 1,968,395 10,734,242 Income (loss) before capital contributions
and transfers (4,223,623) 2,285,949 (468,830)
Capital contributions:

Connection fees 1,889,467
Intergovernmental revenue 1,524,174
Developers contributions 1,186,973
Total capital contributions 3,076,440 - 1,524,174
Transfers (Note 3):

Transfers in
Transfers out (280,327) (82,124) (35,328)
Total transfers (280,327) (82,124) (35,328)
Change in net position (1,427,510) 2,203,825 1,020,016
Net Position:

Beginning of year 83,909,729 66,107,765 5,164,046
End of year $ 82,482,219 $ 68,311,590 $ 6,184,062
Business-type Activities - Enterprise Funds
Major Funds

The notes to the basic financial statements are an integral part of this statement. 33 Non-Major
Governmental
Total Activities
Enterprise Internal
Golf Courses Funds Service Funds
$ 10,153,273 $ 58,475,920 $ 45,093,852
1,354,898
1,558,481 588,388
10,153,273 60,034,401 47,037,138
6,112,074
10,044,042 56,597,255 13,197,093
8,530,135 8,164,220
11,134,760
323,403 10,267,353 6,529,299
10,367,445 75,394,743 45,137,446
(214,172) (15,360,342) 1,899,692
65,175 4,515,065 3,022,898
17,673 1,639,560 1,240,603
(5,422) (4,194,282) (59,676)
11,416,980
(14,210) (47,579) 179,274
28,033 (498,829)
91,249 12,830,915 4,383,099
(122,923) (2,529,427) 6,282,791

1,889,467
1,524,174
1,186,973
- 4,600,614 -
242,867
(397,779) (2,678,218)
- (397,779) (2,435,351)
(122,923) 1,673,408 3,847,440
14,704,122 169,885,662 71,695,347
$ 14,581,199 $ 171,559,070 $ 75,542,787

City of Fairfield, California
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2025
The notes to the basic financial statements are an integral part of this statement. 34 North Bay
Water Treatment
Utility Plant Transportation
Cash Flows from Operating Activities:

Receipts from customers and outside parties $ 36,573,835 $ 13,002,369 $ 367,034 Receipts from interfund services provided
Payments to suppliers (16,807,913) (5,994,306) (6,791,361) Payments to employees (10,113,024) (3,122,243) (942,616) Payments for interfund services used (6,357,044) (762,334) (3,688,027) Net cash provided by (used for) operating activities 3,295,854 3,123,486 (11,054,970) Cash Flows from Noncapital Financing Activities:

Grants 16,652,155
Proceeds from interfund loan 1,124,382
Repayment of interfund loan (6,304,012)
Cash received from other funds
Cash paid to other funds (280,327) (82,124) (35,328)
Net cash provided by (used for) noncapital
financing activities (280,327) (82,124) 11,437,197
Cash Flows from Capital and Related Financing Activities:

Principal payments - bonds (3,016,599)
Interest paid on bonds (4,821,058)
Principal payments - lease liabilities
Interest payments - lease liabilities
Principal payments - subscription-based liabilities (136,051) Interest payments - subscription-based liabilities
Fiscal agent fees paid (6,190)
Collections from lease activities 117,823
Connection fees 1,889,467
Capital contribution 192,500 2,242,296
Proceeds from sales of capital assets 4,400
Acquisition and construction of capital assets (8,359,140) (2,320,184) (14,003,197) (209,539)
Cash Flows from Investing Activities:

Investment income received 3,977,138 1,932,922 31,349
Net cash provided by investing activities 3,977,138 1,932,922 31,349 Net increase (decrease) in cash and cash equivalents (7,010,532) 4,974,284 204,037 Cash and Cash Equivalents:

Beginning of year 76,463,484 34,379,356 -
End of year $ 69,452,952 $ 39,353,640 $ 204,037
Business-type Activities - Enterprise Funds
Major Funds
Net cash provided by (used by) capital
and related financing activities

The notes to the basic financial statements are an integral part of this statement. 35 Non-Major Governmental
Total Activities
Enterprise Internal
Golf Courses Funds Service Funds
$ 10,178,055 $ 60,121,293 $ 12,881,587
45,133,057
(10,116,484) (39,710,064) (23,920,240)
(14,177,883) (12,257,680)
(179,187) (10,986,592) (2,162,787)
(117,616) (4,753,246) 19,673,937
16,652,155
1,124,382
(6,304,012)
242,867
(397,779) (2,678,218)
11,074,746 (2,435,351)
(3,016,599)
(4,821,058)
(77,112) (77,112) (76,472)
(5,422) (5,422) (3,572)
(136,051) (1,859,069)
(56,104)
(6,190)
117,823
1,889,467
2,434,796
4,400 428,385
(369,270) (11,048,594) (3,263,554)
(451,804) (14,664,540) (4,830,386)
79,541 6,020,950 3,551,693
79,541 6,020,950 3,551,693
(489,879) (2,322,090) 15,959,893
2,883,432 113,726,272 74,780,335
$ 2,393,553 $ 111,404,182 $ 90,740,228

City of Fairfield, California
Statement of Cash Flows (continued)
Proprietary Funds
For the Year Ended June 30, 2025
The notes to the basic financial statements are an integral part of this statement. 36 North Bay
Water Treatment
Utility Plant Transportation
Reconciliation of Operating Income to Net Cash
Provided by (Used for) Operating Activities:

Operating income (loss) $ (4,260,652) $ 317,554 $ (11,203,072) Adjustments to reconcile operating income (loss)
to net cash provided by (used for) operating activities:

Depreciation and amortization expense 7,566,664 1,689,049 688,237 Pension expense 3,353,243 552,753 195,299
(Increase) decrease in receivable (988,026) 730,268 (12,424) Decrease in loans receivable 99,079
(Increase) decrease in inventory
(Increase) decrease in prepaid items 199,375
(Increase) decrease in advances to other funds 233,213
Increase (decrease) in advances from other funds (233,213) (Increase) decrease in due from other funds
(Increase) decrease in deferred outflows (2,378,383) (717,823) (291,596) Increase (decrease) in accounts payable (41,354) 99,497 (440,903) Increase (decrease) in compensated absences (76,470) 119,896 9,489 Increase in claims and judgments payable
Increase (decrease) in unearned revenue
Non-cash expense 154,670
Total adjustments 7,556,506 2,805,932 148,102
Net cash provided by (used for) operating activities $ 3,295,854 $ 3,123,486 $ (11,054,970) Non-cash investing, capital and financing activities:
$ 517,245
$ 994,473
(152,377)
27,268
Decrease in capital asset includes loss on disposition of assets (48,269) Business-type Activities - Enterprise Funds
Major Funds
Increase (decrease) in accounts payable for acquisition of capital assets Amortization of bond premium
Increase in subscription liability for the acquisition of right to use assets Contributions of capital assets from developers

The notes to the basic financial statements are an integral part of this statement. 37 Non-Major Governmental
Total Activities
Enterprise Internal
Golf Courses Funds Service Funds
$ (214,172) $ (15,360,342) $ 1,899,692
323,403 10,267,353 6,529,299
4,101,295
24,782 (245,400) 214,755
99,079
41,260 41,260 20,455
53,871 253,246 (112,295)
233,213 3,544,174
(233,213)
5,825,284
(3,387,802)
(286,506) (669,266) (252,500)
52,915 1,012,265
864,000
(60,254) (60,254)
154,670 128,808
96,556 10,607,096 17,774,245
$ (117,616) $ (4,753,246) $ 19,673,937
$ 517,245 $ 732,620
994,473
(152,377)
$ (412,080) (384,812)
(48,269)

City of Fairfield, California
Fiduciary Funds Financial Statements
38 Page 433 of 968
City of Fairfield, California
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2025
The notes to the basic financial statements are an integral part of this statement. 39 Successor Agency
to the Fairfield
Redevelopment Agency
Custodial Private-Purpose
Funds Trust Fund
Assets:

Cash and investments (Note 4) $ 11,805,319 $ 994,337
Receivables, net 5,964,943 957,250
Restricted cash and investments (Note 4) 23,158,402
Land held for resale (Note 20) 3,554,933
Total assets 40,928,664 5,506,520
Liabilities:

Accounts payable and other current liabilities 3,832,958 6,589 Interest payable 1,205,669 141,850
Loans payable to City of Fairfield (Note 20) 109,689
Long-term debt - due within one year (Note 20) 530,000
Long-term debt - due in more than one year (Note 20) 7,746,586 Total liabilities 5,038,627 8,534,714
Deferred Inflows of Resources 47 -
Net Position (Deficit):

Restricted for:

Individuals, organizations and other governments $ 35,889,990 $ (3,028,194) Total net position (deficit) $ 35,889,990 $ (3,028,194) Net Position Fiduciary Funds

City of Fairfield, California
Statement of Changes in Fiduciary Net Position
Fiduciary Funds
For the Year Ended June 30, 2025
The notes to the basic financial statements are an integral part of this statement. 40 Successor Agency
to the Fairfield
Redevelopment Agency
Custodial Private-purpose
Funds Trust Fund
Additions:

Collection of other fees $ 5,076,605
Collection for other governments 30,123,046
Contributions from members 20,000
Special assessments 6,335,366
Property taxes $ 467,984
Investment income 720,159 87,156
Net increase in fair value of investments 108,347 14,805 Bond proceeds and premium 40,991,878
Miscellaneous 82,037
Total Additions 83,375,401 651,982
Deductions:

Distribution of other fees 5,590,673
Distributions to other governments 27,039,131
Program and administrative expenses 4,031,865
Interest expense 5,417,385
Principal payment on bonds 1,315,000
Developer reimbursements 25,381,046
Enforceable obligations 281,422
Total deductions 68,775,100 281,422

Change in Net Position 14,600,301 370,560
Net Position (Deficit) - Beginning of Year 21,289,689 (3,398,754) Net Position (Deficit) - End of the Year $ 35,889,990 $ (3,028,194)

City of Fairfield, California
People and Places in the City
41 Page 436 of 968
City of Fairfield, California
Notes to Basic Financial Statements
For the Year Ended June 30, 2025
42 1) Summary of Significant Accounting Policies.................................................................................................43 2) Property Taxes.............................................................................................................................................53 3) Interfund Transactions.................................................................................................................................54 4) Cash and Investments..................................................................................................................................55 5) Receivables..................................................................................................................................................63 6) Capital Assets...............................................................................................................................................64 7) Accounts Payable and Other Current Liabilities ...........................................................................................67 8) Long-Term Obligations.................................................................................................................................68 9) Leases..........................................................................................................................................................72 10) Subscription-Based Information Technology Arrangements (SBITAs) ..........................................................73 11) Risk Management and Insurance .................................................................................................................74 12) Classification of Net Position .......................................................................................................................75 13) Fund Balances..............................................................................................................................................76 14) Retirement Plans .........................................................................................................................................77 15) Other Post-Employment Benefits (OPEB).....................................................................................................83 16) Tax Abatements-Economic Development Incentives ...................................................................................86 17) Commitment and Contingent Liabilities.......................................................................................................87 18) Excess of Expenditures over Appropriations and Negative Fund Balances/Net Position ..............................87 19) North Bay Treatment Plan ...........................................................................................................................88 20) Successor Agency Trust for Assets of Former Redevelopment Agency .........................................................88 21) Debt with No City Commitment...................................................................................................................91 22) Subsequent Event........................................................................................................................................92

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
43 1) Summary of Significant Accounting Policies
A. Organization and Reporting Entity
The City of Fairfield (the City) was incorporated on December 12, 1903, under the laws of the State of California.

The City is a general law city administered by a Council-Manager form of government. As required by generally accepted accounting principles, these financial statements present the City and its component units, entities for which the City is considered to be financially accountable.

Component units, although legally separate entities, are, in substance, part of the City’s operations and data from these units are combined with data of the City. Based on the above criteria, the accompanying financial statements include the financial activities of these component units:

Fairfield Public Financing Authority
Fairfield Water Facilities Improvement District No. 1
Fairfield Municipal Park Improvement District No. 1
Fairfield Storm Drain Facilities Improvement District No. 1 Fairfield Community Facilities Districts
Housing Authority of the City of Fairfield
These entities are legally separate from each other; however, the City Council serves in separate session as the governing body of these related agencies. The financial activities of these entities are integrally related to those of the City and blended with those of the City. Blending involves aggregating/merging component unit data and data from the City at both the Government-Wide and Fund Financial Statement level.

Each of the component units or activities included in the Government-Wide and Fund Financial Statements are blended components because the governing body of the City is the same or substantially the same as that of the Authority (or District) and management of the City has operational responsibility for the entity. These blended component units do not issue separate financial statements. These component units are described below:
i. Fairfield Public Financing Authority
The Fairfield Public Financing Authority (the Financing Authority) is a public agency created under a joint exercise of powers agreement between the City and the former Redevelopment Agency (now Successor Agency). The Financing Authority was created for the purpose of providing financing of public capital improvements for the City and the former Agency. The Financing Authority is a blended component because the City Council is the governing board of the Financing Authority and management of the City has operational responsibility for the Financing Authority.
ii. Fairfield Water Facilities Improvement District No. 1 The Fairfield Water Facilities Improvement District No. 1 (the Water Improvement District) is a voter-approved improvement district formed in 1972 to finance and build water treatment and storage facilities. The City Council is the governing board of the Water Improvement District. The entity is a blended component because the governing body of the City is the same as that of the District and management of the City has operational responsibility for the District.
iii. Fairfield Municipal Park Improvement District No. 1 The Fairfield Municipal Park Improvement District No. 1 (the Park Improvement District) is a voter-approved improvement district formed in 1972 to finance acquisition and construction of parks and recreational facilities.

The City Council is the governing board of the Park Improvement District. The entity is a blended component

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
44 because the governing body of the City is the same as that of the District and management of the City has operational responsibility for the District.
iv. Fairfield Storm Drain Facilities Improvement District No. 1 The Fairfield Storm Drain Facilities Improvement District No. 1 (the Storm Drain Facilities Improvement District) is a voter-approved improvement district formed in 1972 to finance construction of storm drainage facilities. The City Council is the governing board of the Storm Drain Facilities Improvement District. The entity is a blended component because the governing body of the City is the same as that of the District and management of the City has operational responsibility for the District.
v. Fairfield Community Facilities Districts
The City of Fairfield Community Facilities Districts were created in accordance with the State of California MelloRoos Community Facilities Act of 1972. The Districts were formed to levy special taxes, issue bonds, and obtain loans supported by special taxes for open space and general traffic and street improvements. The City Council is the governing board of the Fairfield Community Facilities Districts. The entity is a blended component because the governing body of the City is the same as that of the Districts and management of the City has operational responsibility for the Districts.
vi. Housing Authority of the City of Fairfield
The Housing Authority of the City of Fairfield (the Housing Authority) is organized under the California Health and Safety Code. The objectives of the Housing Authority are to preserve and increase the supply of affordable housing; to aid low-income families in obtaining decent, safe and sanitary housing through Federal assistance programs and low/moderate income housing programs; and to oversee the housing assets of the former redevelopment agency.

The Housing Authority is governed by a Board of Commissioners composed of five City Council members and two members of the public. This entity is a blended component because the governing body of it and the City are substantively the same and management of the City has operational responsibility for the Authority.

B. Measurement Focus, Basis of Accounting, and Financial Statement Presentation The financial statements of the City have been prepared in conformity with accounting principles generally accepted in the United States of America, as applied to government units (hereinafter referred to as generally accepted accounting principles (GAAP)). The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for governmental accounting and financial reporting principles. These statements implement all the applicable GASB statements.

The accounts of the City and its component units are organized and operated on the basis of fund accounting. A fund is an independent fiscal and accounting entity with a self-balancing set of accounts. Fund accounting segregates funds according to their intended purpose and is used to aid management in demonstrating compliance with finance-related legal and contractual provisions. The minimum number of funds is maintained consistent with legal and managerial requirements.
i. Government - Wide Financial Statements
The City Government-Wide Financial Statements include a Statement of Net Position and a Statement of Activities.

These statements present summaries of Governmental and Business-type Activities for the City accompanied by a total column. Fiduciary activities of the City are not included in these statements.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
45 These statements are presented on an “economic resources” measurement focus and the accrual basis of accounting. Accordingly, all of the City’s assets, deferred outflows of resources, liabilities and deferred inflows of resources, including capital assets, as well as infrastructure assets, and long-term liabilities, are included in the accompanying Statement of Net Position. The Statement of Activities presents changes in net position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned, while expenses are recognized in the period in which the liability is incurred. The Statement of Activities demonstrates the degree to which the direct expenses of a given function or segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. The types of transactions reported as program revenues for the City are reported in three categories: 1) charges for services, 2) operating grants and contributions, and 3) capital grants and contributions. Taxes and other items not included among program revenues are reported instead as general revenues.

Certain eliminations have been made in regards to interfund activities, payables and receivables. All internal balances in the Statement of Net Position have been eliminated, except those representing balances between the governmental activities and the business-type activities, which are presented as internal balances and eliminated in the total primary government column. In the Statement of Activities, internal service fund transactions have been eliminated; however, those transactions between governmental and business-type activities have not been eliminated.
ii. Governmental Fund Financial Statements
Governmental Fund Financial Statements include a Balance Sheet and a Statement of Revenues, Expenditures and Changes in Fund Balances for all major governmental funds and non-major funds as aggregated. An accompanying reconciliation schedule is presented to explain the differences in governmental fund balances as presented in these statements to the net position presented in the Government-Wide financial statements.

All governmental funds are accounted for on a spending or “current financial resources” measurement focus and the modified accrual basis of accounting. Accordingly, only current assets, current liabilities, and deferred inflows of resources are included on the Balance Sheet. The Statement of Revenues, Expenditures and Changes in Fund Balances present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., when they are “measurable and available”). “Measurable” means the amount of the transaction can be determined and “available” means collectible within the current period or soon enough thereafter to pay liabilities of the current period. The City considers property taxes revenues to be available if they are collected within 60 days after year-end. All other revenues reported in the governmental funds are considered to be available if they are received within 90 days after year-end, except for grants, which is one year. Property taxes, sales tax, franchise taxes, licenses, interest, grants, and special assessments are susceptible to accrual.

Revenue from grants, entitlements, and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. Expenditures are recorded when the related fund liability is incurred, except for unmatured interest, which is recognized when due, and certain compensated absences and claims and judgments, which are recognized when the obligations are expected to be liquidated with expendable available financial resources.

The City has presented all major funds that met the applicable criteria. The City reports the following as major governmental funds:

General Fund - is the general operating fund of the City. It is used to account for all financial resources except those which are restricted as to use.

Low Mod Income Housing Special Revenue Fund - is used to account for housing assets, housing functions, and all housing responsibilities previously performed by the now defunct Redevelopment Agency, including financial development and rehabilitation of low and moderate income housing units, including all revolving loan fund programs. The fund is restricted to account for the use of the resources that will increase, improve and preserve

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
46 the supply of housing available for the low and moderate-income households. The primary source of funding is interest income, the repayment of loans receivables, and the sale of land.

City Capital Projects Fund - is used to account for construction projects. The primary sources of funding have been City-levied development taxes, State Gas Tax, Local Transportation Tax, Traffic Safety Funds and temporary loans to projects.
iii. Proprietary Fund Financial Statements
Proprietary Fund Financial Statements include a Statement of Net Position, a Statement of Revenues, Expenses and Changes in Net Position, and a Statement of Cash Flows for each major and non-major proprietary fund.

A column representing internal service funds is also presented in these statements. However, internal service balances and activities have been combined with the governmental activities in the Government-Wide financial statements. Internal Service Funds provide a variety of services to all City departments such as printing and mailing, automotive, communication, cogeneration and Civic Center maintenance, insurance requirements, as well as loans and advances.

Proprietary Funds are accounted for using the “economic resources” measurement focus and the accrual basis of accounting. Accordingly, all assets, deferred outflows/inflows of resources, and liabilities (whether current or noncurrent) are included on the Statement of Net Position. The Statement of Revenues, Expenses and Changes in Net Position presents increases (revenues) and decreases (expenses) in total net position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned, while expenses are recognized in the period in which the liability is incurred. Operating revenues in the proprietary funds are those revenues that are generated from the primary operations of the fund. All other revenues are reported as non-operating revenues.

Operating expenses are those expenses that are essential to the primary operations of the fund. All other expenses are reported as non-operating expenses.

The City has presented the following proprietary funds as major enterprise funds:

Water Utility Fund - accounts for the operations of the water system. This is a self-supporting activity which provides water services on a user charge basis to residences and businesses located in the City.

North Bay Treatment Plant - used to account for the operations of a joint water treatment plant built by the cities of Fairfield and Vacaville. This plant supplies treated water to both the cities. The City of Fairfield is the designated administrator and operator of the plant.

Transportation Fund - accounts for the operations of the City’s transportation system for a fixed route and demand response service which, along with fare box revenues, receives grants from the Transportation Development Act (TDA) and the Federal Transit Administration (FTA) and state and regional funding.

The City has presented the following proprietary fund as non-major enterprise fund:

Golf Courses Fund - accounts for the operations of the two City-owned public golf courses (Rancho Solano and Paradise Valley). The revenue generated from the courses is used to pay the debt service payments on the bond issues with which the courses were constructed.

The City reports the following internal service funds:

Central Services Fund - accounts for the printing, copying, and mail services provided to the various City departments, as well as accounting for public work maintenance supplies for the various City departments.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
47 Vehicle Services/Replacement Fund - accounts for automotive services performed for the various City departments as well as accounting for the City’s Vehicle Replacement Fund.

Information Technology Fund - accounts for the charges to the various departments for the use and maintenance of the main power supplies for various communication devices such as hand radios, phones, computers, and closed circuit video cameras throughout the City.

Intragovernmental Loan Fund - accounts for loans made to City funds or affiliated agencies.

Insurance Fund - accounts for all insurance activities of the City excluding OPEB.

Retiree Insurance (OPEB) Fund - accounts for payment of Other-Post-Employment Benefits including medical and dental premiums for retired executive management employees.

Public Facilities Fund - accounts for the operation of the cogeneration facilities, the major maintenance of the civic center complex, parks, fire department facilities and equipment.

Compensated Absences Fund - accounts for the funding and tracking of the liabilities for vacation, personal leave, and sick leave for the Governmental Activities of the City. iv. Fiduciary Fund Financial Statements
Fiduciary Fund Financial Statements include a Statement of Fiduciary Net Position and Statement of Changes in Fiduciary Net Position. The City’s Fiduciary funds represent Custodial Funds and Private Purpose Trust Funds.

Custodial funds are used to account for assets temporarily held by the City in a fiduciary capacity, and use the economic resources measurement focus. The City’s custodial funds activities include Other Deposits, FairfieldSuisun Sewer District, Solano Animal Control Authority, Green Valley Open Space Maintenance District, Tri-City and County Regional Parks and Open Space Group, Community Facilities Districts Debt Service, and Fairfield Housing and Community Development Corporation, the latter for servicing the debt of the non-commitment debt—see Note 21.

The Private Purpose Trust Fund is a Fiduciary Fund type used by the City to report trust arrangements under which principal and income benefit other governmental entities. This trust fund uses the economic resources measurement focus and the accrual basis of accounting. This fund reports the assets, liabilities and activities of the Successor Agency to the former Fairfield Redevelopment Agency (Successor Agency).

C. Use of Restricted/Unrestricted Net Position and Use of Estimates When an expense is incurred for purposes for which both restricted and unrestricted net position are available, the City’s policy is to use the restricted net position first.

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures.

Accordingly, actual results could differ from those estimates.

D. Cash and Cash Equivalents and Investments
For purposes of the Statement of Cash Flows, cash equivalents are defined as cash and investments which are considered to be liquid assets for purposes of measuring cash flows. Cash and investments of all funds are pooled with the City’s pooled cash and investments, and are considered cash and cash equivalents because the pool is used essentially as a demand deposit account from the standpoint of the funds. Investments are recorded at fair value; changes in fair value are included with investment income in the operating statements.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
48 E. Restricted Cash and Investments
Certain proceeds of debt issues, along with certain resources, are set aside for their repayment and classified as restricted cash and investments on the balance sheet, because their use is limited by applicable bond covenants and/or other agreements.

During fiscal year 2018-2019, the City Council approved the creation of a Section 115 Trust (“Trust”) with Public Agency Retirement Services (PARS) specifically for the accumulation of assets to be used towards the funding of pensions. All assets in the Trust are irrevocably dedicated to funding obligations of the City’s pension beneficiaries or costs of administering the Trust. The funds are not considered plan assets of the City’s pension plan with CalPERS, and are therefore considered restricted assets of the City. These restricted cash and investments, as well as the offsetting restricted fund balance, are reported in the City’s General Fund.

The Restricted Cash and Investments in the North Bay Treatment Plant Enterprise Fund are maintenance reserves for major replacement and rehabilitation projects as defined by the Joint Powers Agreement between the City and the City of Vacaville. See Note 19 for more information on the North Bay Water Treatment Plant joint venture.

F. Unbilled Services Receivable
Utility revenue is recorded when earned. Customers are billed monthly. The estimated value of services provided yet unbilled at year-end has been included in the accompanying financial statements.

G. Inventory and Prepaid Items
Inventory is valued at cost using the first in, first out method. Inventory in the Proprietary Funds consists of expendable supplies held for future consumption or capitalization. The cost is recorded as an expense as inventory and prepaid items are consumed (consumption method). Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items.

H. Investment in Joint Agencies
In addition to the component units listed above, the City also has an ownership interest in the Solano Water Authority and the California Joint Powers Risk Management Authority. These entities do not meet the criteria for being a component unit of the City, and their financial information is not combined with that of the City. The City’s equity investment in the Solano Water Authority is reported in the Water Utility Enterprise Fund as an investment in joint venture. The City is a member of the California Joint Powers Risk Management Authority, an excess insurance pool that provides general liability coverage for occurrences that exceed the City’s self-insured retention (See Note 11).

I. Capital Assets
The City’s assets are capitalized at historical cost or estimated historical cost (except for right-to-use lease assets, the measurement of which is discussed in Note 1N, and right-to-use subscription assets, the measurement of which is discussed in Note 1O). City policy has set the capitalization threshold for reporting general capital assets at $5,000 and infrastructure at $100,000. City Policy has set the capitalization threshold for reporting right-to use subscription IT assets at $50,000. Donations or contributions of capital assets are recorded at acquisition cost when received.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
49 Depreciation/amortization is recorded on a straight-line basis over the estimated useful lives of the capital assets as follows:

Asset Category Useful Life
Buildings 30-60 years
Improvements 30-60 years
Equipment 5-60 years
Infrastructure 25-60 years
Right-to-use lease buildings 3-10 years
Right-to-use lease equipment 5 years
Right-to-use subscription software 2-15 years
The City defines infrastructure as the basic physical assets that allow the City to function. The assets include the street system, water purification and distribution system, sewer and water pipes system, park and recreation lands and improvement, storm water conveyance system, and buildings combined with the site amenities such as parking and landscaped areas used by the City in the conduct of its business. Each major infrastructure system can be divided into subsystems. For example, the street system can be subdivided into pavement, curb and gutters, sidewalks, medians, streetlights, traffic control devices (signs, signals and pavement markings), landscaping and land. These subsystems were not delineated in the Basic Financial Statements. The appropriate operating department maintains information regarding the subsystems.

J. Deferred Outflows/Inflows of Resources
Deferred outflows of resources represent a consumption of net assets that applies to a future period and will not be recognized as an outflow of resources (expense/expenditure) until then. The City has four items that qualifies for reporting in this category: 1) deferred charges on refunding reported in the government-wide statement of net position (deferred charge on refunding results from the difference in the carrying value of refunded debt and its reacquisition price.) This amount is deferred and amortized over the shorter of the life of the refunded or refunding debt; 2) deferred outflows/inflows related to pensions. See Note 14. A. 3. for further discussion; 3) deferred outflows/inflows related to Other Post-Employment Benefits (OPEB). See Note 15. B. 6. for further discussion; and 4) deferred inflows related to leases where the City is the lessor, are reported in the governmental funds balance sheet and statement of net position. The deferred inflows of resources related to leases are recognized as an inflow of resources (revenue) on a straight-line basis over the term of the lease (See Note 9).

Deferred inflows of resources represent an acquisition of net assets that applies to a future period and will not be recognized as an inflow of resources (revenue) until that time. For the governmental funds, the City has two of these items which qualify for reporting in this category (under the modified accrual basis of accounting).

Accordingly, the item, unavailable revenue, is reported only in the governmental funds balance sheet and represents unavailable revenues from interest receivable on notes as well as loan receivables which are due in greater than 90 days. These amounts are deferred and recognized as inflows of resources in the period that the amounts becomes available. The fund statements also carry an amount related to lease receivables. These amounts are amortized as amounts become available. At the government-wide statements, these two items are eliminated and recognized as revenue since “availability” of resources is not a criteria used in the governmentwide statements. In addition, the City reports deferred inflows related to pension/OPEB for certain pension/OPEB related items and leases. See Notes 9, 14. A. 3 and Note 15 for further discussion.

K. Pensions
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the City of Fairfield’s California Public Employees Retirement System (CalPERS) Miscellaneous and Safety Plans and additions to/deductions from the Plan’s fiduciary net position have been determined on the same basis as they are reported by CalPERS. For this

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
50 purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. See Note 14 for further discussion regarding pensions.

L. Other Postemployment Benefits (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows of resources related to OPEB, and OPEB expense, information about the City’s plan (OPEB Plan) have been determined on the accrual basis. See Note 15 for further discussion regarding OPEB.

M. Long Term Obligations Compensated Absences
The City provides employees with vacation, sick, compensatory time-off and personal leave benefits. A liability for compensated absences is recognized when the leave is earned and it is more likely than not that the leave will be used or otherwise paid or settled. The liability is measured using employee's pay rate as of the date of the financial statement, including certain salary-related payment directly associated with the leave. i. Government-Wide Financial Statements
For governmental and business-type activities, compensated absences are recorded as incurred and related expenses and liabilities are reported.
ii. Fund Financial Statements
Compensated absences for governmental funds are recorded in an internal service fund. Thus, the liability in the internal service fund is reported as compensated absences expenses are incurred. In proprietary funds, compensated absences are expensed and funded by the various funds in the period in which they are earned.

N. Leases
The City determines if an arrangement is a lease at inception.

When the City is a lessor, lease receivables are recorded by the City as the present value of future lease payments expected to be received from the lessee during the lease term, reduced by any provision for estimated uncollectible amounts. Lease receivables are subsequently reduced over the life of the lease as cash is received in the applicable reporting period. The present value of future lease payments to be received are discounted based on the interest rate the City charges the lessee.

When the City is a lessee, leases are included in capital assets and lease liabilities in the statements of net position.

Lease assets represent the City’s control of the right to use an underlying asset for the lease term, as specified in the contract, in an exchange or exchange-like transaction. Lease assets are recognized at the commencement date based on the initial measurement of the lease liability, plus any payments made to the lessor at or before the commencement of the lease term and certain direct costs. Lease assets are amortized in a systematic and rational manner over the shorter of the lease term or the useful life of the underlying asset.

Lease liabilities represent the City’s obligation to make lease payments arising from the lease. Lease liabilities are recognized at the commencement date based on the present value of expected lease payments over the lease term, less any lease incentives. Interest expense is recognized ratably over the contract term. The lease term may include options to extend or terminate the lease when it is reasonably certain that the City will exercise that option.

The City recognizes payments for short-term leases with a lease term of 12 months or less as expenses as incurred, and these leases are not included as lease liabilities or right-to-use lease assets on the statement of net position.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
51 For individual contracts where information about the discount rate implicit in the lease are not included, the City has elected to use the incremental borrowing rate to calculate the present value of expected lease payments.

O. Subscription-Based Information Technology Arrangements (SBITAs) The City determines if an arrangement is a Subscription-Based Information Technology Arrangement (SBITA) at inception.

Right-to-use subscription assets are recognized at the commencement date and represent the City’s right to use the underlying subscription IT asset for the subscription term. Right-to-use subscription IT assets are measured at the initial value of the subscription liability plus any payments made to the vendor at or before the commencement date of the subscription term, plus any capitalizable initial implementation costs necessary to place the subscription IT asset into service. Right-to-use subscription IT assets are amortized in a systematic and rational manner over the shorter of the subscription term or useful life of the underlying asset. City policy has set the capitalization threshold for reporting right-to use subscription IT assets at $50,000.

Subscription Liabilities represent the City’s obligation to make subscription payments arising from the subscription contract. Subscription liabilities are recognized at the subscription commencement date based on the present value of future subscription payments expected to be made during the subscription term. The present value of subscription payments are discounted based on an incremental borrowing rate determined by the City.

The City recognizes payments for short-term Subscription-Based Information Technology Arrangements with a subscription term of 12 months or less as expenses as incurred, and these arrangements are not included as subscription liabilities or right-to-use subscription assets on the statements of net position.

P. Fund Balances
The Governmental Fund Balances consist of Nonspendable, Restricted, Committed, Assigned and Unassigned amounts as described below: (See Note 13 for tabular presentation) Nonspendable: Items that cannot be spent because they are not in spendable form, long term portions of receivables (net of the amount accounted for in restricted funds), inventories, prepaid items, and also items that are legally or contractually required to be maintained intact, such as principal of an endowment from a third party.

Restricted: Restricted fund balances encompass the portion of net fund resources subject to externally enforceable legal restrictions. This includes externally imposed restrictions by creditors (such as through debt covenants), grantors, contributors, laws or regulations of other governments, as well as restrictions imposed by law through constitutional provisions or enabling legislation.

Committed: Committed fund balances encompass the portion of net fund resources which use is constrained by limitations that the government imposes upon itself by formal action through City Council Resolution. The City Council is also the highest level of decision making for all of its component units. Commitments may be changed or removed only by the same formal action (City Resolution) taken by the City Council to impose the constraint.

The City has adopted a policy to achieve and maintain committed fund balance in the General Fund of at least 20% of expenditures.

Assigned: Assigned fund balances encompass the portion of net fund resources reflecting the government’s intended use of resources. Assignment of resources can be done by the highest level of decision making or by a committee or official designated for that purpose. The Finance Director has been given authority by the City Council to assign funds for the City of Fairfield.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
52 Unassigned: Unassigned fund balances encompass 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.

Q. Land Held for Development
Land held for development includes land parcels used to develop or redevelop blighted properties and are reported at the lower of cost or net realizable value or agreed-upon price if a disposition agreement has been made with a developer. Individual parcels that have experienced a market decline are written down to estimated current fair value.

R. Unearned Revenue
Unearned revenues are a liability because it refers to revenue that has not yet been earned but represents products or services that are owed to the customer. As the product or service is delivered over time, it is recognized as revenue on the income statement. Examples of unearned revenue include prepaid rental revenues, as well as permits, business license taxes, grants, and prepaid revenues received in advance of the required services being performed.

S. Spending Policy
The City believes that sound financial management principles require that sufficient funds be retained by the City to provide a stable financial base at all times. To retain this stable financial base, the City needs to maintain unassigned fund balance in its General Fund sufficient to fund the cash flows of the City and to provide financial reserves for unanticipated expenditures and/or revenue shortfalls of an emergency nature. The City has adopted a policy to achieve and maintain an unassigned fund balance in the General Fund of at least 20% of expenditures.

At the governmental fund financial statement level, the City’s policy is that restricted, committed, and assigned fund balances are considered to have been spent first before unassigned fund balances have been spent, when expenditures are incurred for purposes for which amounts in any of those fund balance classifications could be used.

T. Implementation of New GASB Pronouncements
In fiscal year 2024-2025, the City implemented the following new accounting standards to conform to the following Governmental Accounting Standards Board (GASB) Statements:

GASB Statement No. 101 – In June 2022, the GASB issued Statement No. 101, Compensated Absences. The objective of this Statement is to better meet the information needs of financial statement users by updating the recognition and measurement guidance for compensated absences. That objective is achieved by aligning the recognition and measurement guidance under a unified model and by amending certain previously required disclosures. The Statement did not have a material effect on the financial statements.

GASB Statement No. 102 – In December 2023, the GASB issued Statement No. 102, Certain Risk Disclosures. The objective of this Statement is to provide users of government financial statements with essential information about risks related to a government’s vulnerabilities due to certain concentrations or constraints. The disclosures will provide users with timely information regarding certain concentrations or constraints and related events that have occurred or have begun to occur that make a government vulnerable to a substantial impact. As a result, users will have better information with which to understand and anticipate certain risks to a government’s financial condition. The Statement did not have a material effect on the financial statements.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
53 U. Budgetary Information
The City adopts annual budgets for all its funds except for the Custodial Funds, the Permanent Fund, and the Private-Purpose Trust Fund. The City operates on a fiscal year basis that begins on July 1 of each year, and ends the following year on June 30. The City Manager’s Office and Finance Department manage the budget process, with support from each of the operating departments. The preparation of the budget takes place between January and June, culminating with the adoption of a two-year budget by the City Council, with the Council adopting any adjustments before the beginning of the second fiscal year as part of a mid-cycle review performed by staff.

Public hearings are conducted on the proposed budgets to review all appropriations and sources of financing.

Budgeted expenditures are then adopted through the passage of a resolution. The budget represents the maximum authorized expenditures for the year and cannot legally be exceeded except by subsequent amendments of the budget by the City Council. Any amendments to the total level of net appropriations for a fund or transfers between funds must be approved by the City Council. Capital project appropriations shall remain in effect until the project is completed or until modified in a subsequently adopted budget. See the detailed budget preparation calendar for the City in the Appendix of the adopted budget document for details on this process.

Expenditures are controlled at the fund level for all budgeted funds within the City, the level at which expenditures may not legally exceed appropriations. The budgets are adopted on a basis consistent with GAAP.

V. Reclassification
Certain accounts relating to the prior year have been reclassified to conform to the current year presentation with no effect on previously reported net position.
2) Property Taxes
Property taxes are levied and become a lien on real property at January 1, based on the assessed values determined by the Solano County Assessor (the County). Taxes are due November 1 and February 1 and are delinquent if not paid by December 10 and April 10, respectively. Property tax revenues are recognized when levied.

Article XIII of the California Constitution (known as “Proposition 13”) limits ad valorem taxes on real property to 1 percent of value plus taxes necessary to pay indebtedness approved by voters before July 1, 1978. The Article also established the 1975/76 assessed valuation as the basis and limits annual increases to the cost of living, not to exceed 2 percent, for each year thereafter. Property may also be reassessed to full market value after a sale, transfer of ownership, or completion of new construction. The State is prohibited under the Article from imposing new ad valorem, sales, or transaction taxes on real property. Local government may impose special taxes (except on real property) with the approval of 2/3 of the qualified electors. In addition to the City’s property tax levies for voter-approved debt, Solano County levies property taxes limited to $1 per $100 of assessed valuation for county, cities, schools, and special districts’ operating expenditures. This additional property tax levy is distributed to the different governmental agencies under the State mandated alternate method of apportioning taxes (commonly referred to as the “Teeter Plan”) whereby all local agencies with historical tax delinquency rates less than three percent, including cities, receive from the county 100% of their respective shares of the amount of ad valorem taxes levied, without regard to the actual collection of taxes levied. This method was placed in effect by Solano County in the 1965/66 tax year and remains in effect unless the County Board of Supervisors orders its discontinuance.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
54 3) Interfund Transactions
The City had numerous transactions between funds to finance operations, construct assets, and service debt all within the course of normal business operations. As discussed below, these transactions are classified as transfers in/out, due to/from other funds or advances to/from other funds.

The following tables summarize interfund transfers (as presented in the City’s Fund Financial Statements) for the fiscal year ended June 30, 2025, including a description of major transfer activity:

Low Mod City Non-Major
General Income Capital Governmental Internal
Fund Housing Projects Funds Service Totals
Transfers Out:
(fund making transfer)
Governmental Funds:

General Fund - $ 45,000 $ 1,325,010 $ 3,472,337 $ - $ 4,842,347 Low Mod Income Housing Fund - - 629,799 629,799
City Capital Projects Fund - 84,607 - 84,607
Non-Major Governmental Funds $ 2,655,000 - 4,747,179 61,041 $ 242,867 7,706,087 Total Governmental Funds 2,655,000 45,000 6,072,189 4,247,784 242,867 13,262,840 Enterprise Funds:

Water Utility - 280,327 280,327
North Bay Treatment Plant 82,124 82,124
Transportation - 35,328 35,328
Total Enterprise Funds - - 397,779 - 397,779
Internal Service Funds - 2,450,651 227,567 - 2,678,218
Totals $ 2,655,000 $ 45,000 $ 8,522,840 $ 4,873,130 $ 242,867 $ 16,338,837 Transfers In (fund receiving transfer):

Governmental Funds
A. General Fund
The transfers in from Non-Major Governmental Funds (Capital Projects Assessment and Improvement District Fund) for $2,655,000 was related to Community Facilities Districts funding to the General fund for various police, fire, and parks activities.

B. Low\Mod Housing
The transfers in from the General Fund of $45,000 was the City’s contribution to the Housing Trust Fund which was established in FY 2021-2022.

C. City Capital Projects
The transfers in from the General Fund of $1,325,010 were for future funding of delayed projects related to Fire Station 36, Fire Station 39 and the West Texas Complete Street Project. The transfers in from Non-Major Governmental Funds (State Gas Tax Special Revenue Fund, Development Tax Special Revenue Fund, and Assessment and Improvement Districts Capital Projects Fund) with a combined amount of $4,747,179 were used to fund street maintenance, traffic improvements, pavement rehabilitation and various capital projects. The construction and rehabilitation of these capital projects are needed to meet standards contained in the City’s General Plan. The transfers in of $2,450,651 from the Internal Service Funds were mainly from the Intergovernmental Loan fund that were used to fund the Heart of Downtown Texas Streetscape Improvement Project and the purchase of the PAL Center.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
55 D. Non-Major Governmental Funds
The transfers in of $4,873,130 were mostly comprised of $3,000,005 for the funding to the Non-Major Governmental Fund (Pension Obligation Debt Service Fund) for the servicing of the Pension Obligation Bonds. A portion of the total amount, $1,273,125, were transfers in from the General Fund to the City’s portion of the Maintenance Districts throughout the City and the remaining portion of $600,000 was a transfer in from the Low Mod Income Housing Fund to the Section 8 Housing Fund to cover administrative costs.

E. Internal Service Funds
The transfer in from Non-Major Governmental Funds (Special Programs) of $242,867 to the Intergovernmental Loan Fund was to reserve funding for future projects from interest earned on grant funding.

Due From/To Other Funds consist of the following at June 30, 2025:

Due from Other Funds
(fund making loan)
Non-Major Governmental
Funds
Enterprise
Transportation
Internal Service Funds $ 444,461 $ 1,124,382
Due to Other Funds
(fund receiving loan)
Due to other funds consist of a short-term advance for year-end cash flow purposes until the Transportation Fund and Special Programs Fund receives its various grant receipts.

Advances From/To Other Funds consist of the following at June 30, 2025:

Internal Service Fund
Intergovermental Loan $ 598,200
Enterprise
North Bay Treatment Plant $ 1,399,280
Advances to Other Funds
(fund making loan)
Advances From Other Funds
(fund receiving loan)
Non-Major
Governmental Funds
Enterprise
Water Utility
The Internal Service Fund – Intergovernmental Loan Fund loaned $797,600 to the Non-Major Maintenance Districts Fund to assist and supplement the districts' budget in seven of the respective districts that were encountering cash shortfalls. These loans are interest free and are being repaid over five years which began in FY 2023-2024. The balance of the loans as of June 30, 2025 is $598,200.

The Enterprise Fund—North Bay Treatment Water Plant advanced funds to the Enterprise Fund—Water Utility Fund in the amount of $2,330,419 to finance water plant improvements. This advance is being repaid over a ten year period which began in FY 2021-2022. The balance as of June 30, 2025 is $1,399,280. 4) Cash and Investments
The City manages the cash of the City and component units on a pooled basis. Funds are invested in accordance with Section 53601 of the State government code and the City’s established investment policy. All monies not required for immediate expenditure are invested or deposited to earn the maximum yield consistent with safety and liquidity. All investments have the City as registered owner or are kept in the custody of the City or a qualified

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
56 safekeeping institution. A monthly investment report is submitted to the City Manager and City Council showing a description of the investments, purchase price, purchase date, current fair value for all securities with a maturity of more than 12 months, maturity date, par value, discount or premium if any, cost, yield, safekeeping institution for each deposit or investment, average weighted maturity and effective yield of the portfolio. A portion of the portfolio is managed by third party investment managers. The City has contracted with PARS to manage a Section 115 Trust for the City’s Pension Trust fund.

A. Deposits
The carrying amount of the City’s cash deposits at June 30, 2025 was $5,128,105 and the bank balance was $6,105,235. The carrying amount of the City’s cash deposits with Fiscal Agent at June 30, 2025 was $1,431,947 and the bank balance was $2,236,839. The entire bank balances were covered by federal depository insurance up to $250,000 or by collateral held by the City’s agent in the City’s name as discussed below.

The California Government Code has provisions for financial institutions that limit custodial credit risk for deposits.

Financial institutions are required to secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law. The fair value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits. The City’s financial institutions also have insurance through the Federal Depository Insurance Corporation (FDIC).

B. Investments
The City’s investment policy restricts investments to the following:

Certificates of Deposit must be FDIC insured or fully collateralized. They must also be purchased from banks or financial institutions located in California.

Negotiable Certificates of Deposit may not exceed 30% of the City’s invested funds.

Bankers’ Acceptances may be invested if issued by domestic or foreign banks provided, they are institutions with short-term debt obligations rated “A-1” or higher, or the equivalent, by a nationally recognized statistical-rating organization (NRSRO); and have long-term debt obligations which are rated “AA” or higher by at least two nationally recognized statistical rating organizations. No more than 30% of the City’s portfolio may be invested in this category.

Treasury Bills and Notes with a maximum maturity of five years.

Federally-Sponsored Credit Agency Securities with a maximum maturity of five years (75% maximum).

Local Agency Investment Fund (LAIF) deposits may be made in this fund up to the State of California limit of $75,000,000 for each government entity. The City and its component units have three accounts with LAIF, therefore the maximum deposit that may be made is $225,000,000.

California Asset Management Program (CAMP) is a California Joint Powers Authority ("JPA") established in 1989 to provide California public agencies with professional investment services. The CAMP Pool is a permitted investment for all local agencies under California Government Code Section 53601(p). This program consists of a short-term money market fund rated AAA and separately managed portfolios of specific authorized securities (as specified in this policy). This pool carries a stable Net Asset Value, whereby the fair value position in the pool is the same as the value of the pool shares.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
57 Savings Accounts, Money Market Accounts and General Checking Accounts may be used to deposit idle cash. No account may be opened without written authorization from the Finance Director.

Commercial Paper must be rated prime quality (P1 by Moody’s or A1 by Standard and Poor’s). Eligible paper is further limited to notes issued by corporations organized and operating within the U.S. and having total assets in excess of $500,000,000 and having an “A” or higher rating in other long term debt (25% maximum).

Corporate Medium-Term Notes must be rated A by two or more NRSOs (Nationally Recognized Statistical Rating Organization). The maximum maturity of medium-term notes may not exceed five years. No more than 30% of the City’s portfolio may be invested in this category.

Money Market Mutual Funds must attain the highest ranking, or the highest letter and numerical rating provided by not less than two nationally recognized statistical rating organizations. The purchase of securities authorized by this subdivision may not exceed 20% of the portfolio. No more than 10% per money market fund.

Municipal Obligations must be rated at least A by at least two NSRO’s. The maximum maturity is five years and no more than 5% can be invested with one agency.

Supranationals must be rated AAA by at least two NSRO’s; the maximum maturity is five years and no more than 10% of the City’s portfolio can be invested in this category.

Repurchase Agreements, Reverse Repurchase Agreements, Financial Futures and Options, U.S. Zero Coupons and Bonds, and Small Business Administration Guaranteed Notes may not be invested in without specific instruction from the Finance Director. The Cash with Fiscal Agents represents primarily restricted bond proceeds (for bond required reserves) and is governed by the provisions of the relevant bond documents and indentures.

Section 115 Pension Trust is governed by the provisions of the City of Fairfield Section 115 Trust Agreement with PARS rather than the general provisions of the California Government Code or the City’s investment policy.

Investments authorized to be held in the trust include Equity, Fixed Income, and Money Market Mutual Funds, with target percentages of 60%, 35%, and 5% respectively. These funds have been restricted for future pension contributions.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
58 C. Risk Disclosures
Interest Rate Risk is defined as the risk that changes in interest rates demanded by the market will adversely affect the fair value of an investment. As a means of limiting its exposure to fair value losses arising from rising interest rates, State law, and the City’s investment policy limits the City’s investment portfolio to maturities not to exceed five years from the time of purchase. Information about the sensitivity of the fair values of the City’s investments to market interest rate fluctuations (including $23,158,402 of debt proceeds held by bond trustees and $7,765,098 in the Section 115 Pension Trust) is provided by the following table that shows the fair values of investments held by the City grouped by maturity at June 30, 2025:

One year One to Two to Three to Four to % of
Investment Category or less Two Years Three Years Four Years Five Years Total portfolio LAIF $ 9,511,510 $ 9,511,510 2%
U.S. Government Agencies 12,237,744 $ 10,982,423 $ 10,029,568 $ 2,051,741 35,301,476 8% U.S. Treasuries 16,321,253 62,190,824 81,367,514 26,378,426 $ 12,238,713 198,496,730 45% Negotiable CDs 3,363,687 3,363,687 0%
Medium Term Notes 4,759,888 30,151,170 24,517,481 13,263,502 2,278,270 74,970,311 17% Supranationals 1,240,694 1,711,421 2,952,115 1%
Money Market Mutual Funds 4,857,976 4,857,976 1%
CAMP 108,070,357 108,070,357 24%
Section 115 Trust:

Equity Mutual Funds 4,638,982 4,638,982 1%
Fixed Income Mutual Funds 2,973,118 2,973,118 1%
Money Market Mutual Funds 152,998 152,998 0%
Totals $ 163,523,826 $ 106,688,104 $ 115,914,563 $ 42,934,363 $ 16,228,404 $ 445,289,260 100% Remaining Maturity (in years)
Credit Risk is a risk that a security or a portfolio will lose some or all of its value due to a real or perceived change in the ability of the issuer to repay its debt. Generally, this is measured by the assignment of a rating by a Nationally Recognized Statistical Rating Organization (NRSRO) (see credit quality ratings in section F). The City’s credit quality risk policy is discussed in section B above, within the individual security types.

Custodial Credit Risk is a risk that in the event of the failure of the counterparty (e.g. broker-dealer), the City will not be able to recover the value of its investment or collateral securities that are held by the counterparty. All of the City’s investments in securities are held in the name of the City and are held via book entry at the location of the City’s third-party custodian. Therefore, the City has no custodial credit risk.

Concentration Risk can also arise in the wake of a failure to adequately diversify investments. Except for treasuries and agency securities, the City’s investment policy attempts to limit the City’s investments in any one bank or corporation to no more than 5% of the total portfolio (at the time of purchase). There are no Investments in any one issuer (other than U.S. Treasury securities, mutual funds, and external investment pools) that represent 5% or more of the total City’s investment.

D. Investments in Local Agency Investment Funds
As of June 30, 2025, the City has $9,500,000 invested in LAIF. The City valued its investments in LAIF as of June 30, 2025, by multiplying its account balance with LAIF of $9,511,510 by a fair value factor determined by LAIF. The fair value factor was determined by dividing all LAIF participants’ total aggregate fair value by total aggregate amortized cost resulting in a factor of 1.001198.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
59 The LAIF is part of the Pooled Money Investment Account (PMIA) with the State and is a voluntary program that provides an investment alternative for California’s local governments and special districts. The LAIF pool is not registered (nor required to be registered) with the SEC. The PMIA began in 1955 and oversight is provided by the Pooled Money Investment Board (PMIB) and an in-house investment committee. The Local Investment Advisory Board (LIAB) provides oversight for LAIF. The Board consists of five members, as designated by statute.

Additionally, the State Treasurer’s Office is audited by the Bureau of State Audits on an annual basis, as well as a continuing audit process throughout the year.

The City has $108,070,357 invested in CAMP, of which $21,025,464 is held in Bond Reserves for the City’s Community Facilities Districts (CFD’s) Bond Obligations. This pool carries a stable Net Asset Value, whereby the fair value position in the pool is the same as the value of the pool shares.

E. Summary of Cash and Investments
The following is a summary of cash and investments at June 30, 2025:

Fiduciary Funds
Governmental Business-type Statement of
Category Activities Activities Subtotals Net Position Totals Cash and Investments $ 296,721,974 $ 78,690,567 $ 375,412,541 $ 12,799,656 $ 388,212,197 Restricted Cash and Investments 7,765,098 32,713,615 40,478,713 23,158,402 63,637,115 Total Cash and Investments $ 304,487,072 $ 111,404,182 $ 415,891,254 $ 35,958,058 $ 451,849,312 Government-Wide Statement of Net Position

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
60 F. Summary
At June 30, 2025, the City had the following deposits and investments, with corresponding credit quality ratings:

Standard & Poor's
Credit Quality Fair
Investment Category Ratings Value
City Treasury:

Deposits $ 5,128,105
Investments
Securities of US Gov't Agencies
FHLB AA 2,215,442
FNMA AA 7,881,827
FHMS AA 1,902,506
FHLMC AA 19,231,525
FFCB AA 4,070,176
Total Securities of US Gov't Agencies 35,301,476
US Treasury Notes Not Rated 196,363,793
Medium Term Notes AAA 5,271,157
Medium Term Notes AA 25,079,786
Medium Term Notes A 44,619,368
Negotiable CD A 3,363,687
Supranationals AAA 2,952,115
Money Market Mutual Funds AAA 4,853,560
CAMP AAA 87,044,893
Local Agency Investment Funds Not rated 9,511,510
Total Investments 414,361,345
Total City Treasury 419,489,450
Fiscal Agents:

Deposits 1,431,947
Investments
Securities of US Gov't Agencies
US Treasury Notes Not Rated 2,132,937
CAMP AAA 21,025,464
Money Market Mutual Funds AAA 4,416
Section 115 Trust:

Equity Mutual Funds Not Rated 4,638,982
Fixed Income Mutual Funds BB 2,973,118
Money Market Mutual Fund AAA 152,998
Total Investments 30,927,915
Total Cash and Investments with Fiscal Agents 32,359,862 Total Cash and Investments $ 451,849,312
*The investment holding is in compliance with the City's investment policy. See Note 4B.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
61 G. Fair Value Measurements
The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset.

The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described as follows:

Level 1 – Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the City could access.

Level 2 – Inputs to the valuation methodology include:
• Quoted prices for similar assets or liabilities in active markets; • Quoted prices for identical or similar assets or liabilities in inactive markets; • Inputs other than quoted prices that are observable for the asset or liability; • Inputs that are derived principally from observable market data by correlation or other means.

Level 3 – Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

Unobservable inputs reflect the City’s own assumptions about the inputs market participants would use in pricing the asset or liability (including assumptions about risk). Unobservable inputs are developed based on the best information available in the circumstances and may include the City’s own data.

The asset’s level within the hierarchy is based on the lowest level of input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs. The determination of what constitutes observable requires judgment by the City’s management. City management considers observable data to be market data, which is readily available, regularly distributed or updated, reliable, and verifiable, not proprietary, and provided by multiple independent sources that are actively involved in the relevant market. The categorization of an investment within the hierarchy is based upon the relative observability of the inputs to its fair value measurement and does not necessarily correspond to City management’s perceived risk of that investment.

In instances where inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The City’s assessment of the significance of inputs to these fair value measurements requires judgment and considers factors specific to each asset or liability.

The City’s investments in governmental investment pools, such as LAIF and CAMP (JPA investment Pools) are recorded at fair value and the City’s proportionate share in these types of investments is measured based on uncategorized input not defined as a Level 1, Level 2, or Level 3 input; but rather labeled as items measured at fair value not leveled.

The following is a description of the valuation methods and assumptions used by the City to estimate the fair value of its investments. There have been no changes in the methods and assumptions used at June 30, 2025. The methods described may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. City management believes its valuation methods are appropriate and consistent with other market participants. The use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

The City’s treasury pool asset market prices are derived from closing bid prices as of the last business day of the month as supplied by Interactive Data, Bloomberg, or Telerate. Where prices are not available from generally recognized sources, the securities are priced using a yield-based matrix system to arrive at an estimated fair value.

Prices that fall between data points are interpolated. When available, quoted prices are used to determine fair

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
62 value. When quoted prices in active markets are available, investments are classified within Level 1 of the fair value hierarchy.

For investments classified within Level 2 of the fair value hierarchy, the City’s custodians generally use a multidimensional relational model. Inputs to their pricing models are based on observable market inputs in active markets. The inputs to the pricing models are typically benchmark yields, reported trades, broker-dealer quotes, issuer spreads, and benchmark securities, among others. The City does not have any investments that are measured using Level 3 inputs. The City has the following recurring fair value measurements as of June 30, 2025:

Quoted Prices in Significant
Active Markets Other Significant
for Identical Observable Unobservable
Assets Inputs Inputs
Investments by fair value level Total (Level 1) (Level 2) (Level 3) US Treasuries $ 198,496,730 $ 198,496,730
Government Agency Securities 35,301,476 $ 35,301,476
Negotiable Certificates of Deposit 3,363,687 3,363,687
Medium Term Notes 74,970,311 74,970,311
Supranationals 2,952,115 2,952,115
Section 115 Trust:

Equity Mutual Funds 4,638,982 4,638,982
Fixed Income Mutual Funds 2,973,118 2,973,118
Totals 322,696,419 $ 206,108,830 $ 116,587,589 $ -
Items measured at fair value not leveled
CAMP 108,070,357
LAIF 9,511,510
Money Market Mutual Funds 4,857,976
Section 115 Trust:

Money Market Mutual Funds 152,998
Total Fair Value of Investments $ 445,289,260
Fair Value Measurements on a Recurring Basis Using

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
63 5) Receivables
Receivables as of June 30, 2025, net of applicable allowances for uncollectible accounts (where applicable), are as follows:

Governmental Activities
Other
Low Mod City Non-Major Total
General Income Capital Governmental Governmental
Category Fund Housing Projects Funds Activities
Taxes $ 12,101,925 $ 12,101,925
Interest and other 607,351 35,207 $ $ 429,393 $ 442,620 1,514,571 Intergovernmental 394,606 3,515,253 696,256 4,606,115
Notes 30,991,898 17,256,445 48,248,343
Leases (Note 9) 15,980,904 15,980,904
Accounts 728,603 28,283 122,243 1,357,168 2,236,297
Less Allowance for Doubtful Accounts (72,491) (72,491)
Total Receivables, Net $ 29,740,898 $ 31,055,388 $ 4,066,889 $ 19,752,489 84,615,664 Add Internal Service Fund Receivables 1,424,554
Total Receivables, Net $ 86,040,218
Major Funds
In the governmental activities, approximately $30,991,898 of the outstanding balance of notes receivable in the Low Mod Income Housing Special Revenue Fund and $17,159,568 in Non-Major Governmental Special Revenue Funds (Home, CDBG, and NSP) are not anticipated to be collected within the next year. $15,681,168 of leases receivable in General Fund is not anticipated to be collected within the next year.

The amount due to the City from the Successor Agency at June 30, 2025, was $109,689 and is reported as notes receivable in the Non-Major Governmental Special Revenue Home Program (see Note 20).

Business-type Activities
Non-Major
Fund
North Bay Total
Water Treatment Business-Type
Category Utility Plant Transportation Golf Courses Activities Interest and other $ 599,639 $ 264,624 $ 4,783 $ 15,689 $ 884,735 Intergovernmental 1,576,023 3,757,718 5,333,741
Leases (Note 9) 1,981,053 1,981,053
Accounts 8,655,601 9,110 51,429 263,093 8,979,233
Less Allowance for Doubtful Accounts (445,509) (445,509) Subtotal Receivables, Net 10,790,784 1,849,757 3,813,930 278,782 16,733,253 Loans 1,544,458 1,544,458
Total Receivables, Net $ 10,790,784 $ 3,394,215 $ 3,813,930 $ 278,782 $ 18,277,711 Major Funds
l A

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
64 6) Capital Assets
Capital Assets for the governmental activities of the City for the year ended June 30, 2025, consisted of the following:

Balance
July 1, 2024 Balance
Asset Description As Reclassified Additions Deletions Transfers June 30, 2025 Governmental activities:

Non-depreciable assets:

Land $ 46,515,634 $ 1,800,000 $ 48,315,634
Intangibles - 61,307 61,307
Work in progress 9,342,509 16,117,839 $ (3,927,782) 21,532,566 Total non-depreciable assets 55,858,143 17,979,146 $ - (3,927,782) 69,909,507 Assets being depreciated/amortized:

Land improvements 211,875,719 3,718,523 215,594,242
Buildings and improvements 108,487,192 18,715 108,505,907 Machinery and equipment 59,057,708 2,487,503 (3,050,268) 209,259 58,704,202 Infrastructure 325,970,993 5,795,316 331,766,309
Right-to-use lease buildings 1,636,995 (654,906) 982,089 Right-to-use lease machinery and equipment 4,394,110 (765,022) 3,629,088 Right-to-use subscription software 13,317,133 1,923,193 (278,871) 14,961,455 Total assets being depreciated/amortized 724,739,850 10,224,727 (4,749,067) 3,927,782 734,143,292 Accumulated depreciation/amortization:

Land improvements (43,191,131) (5,255,026) (48,446,157) Buildings and improvements (79,181,192) (3,363,260) (82,544,452) Machinery and equipment (36,201,082) (4,093,949) 2,798,012 (37,497,019) Infrastructure (240,198,400) (4,435,005) (244,633,405)
Right-to-use lease buildings (651,604) (227,814) 347,349 (532,069) Right-to-use lease machinery and equipment (515,530) (414,437) (929,967) Right-to-use subscription software (4,105,963) (3,098,038) 278,871 (6,925,130) Total accumulated depreciation/amortization (404,044,902) (20,887,529) 3,424,232 - (421,508,199) Total depreciable/amortizable assets, net 320,694,948 (10,662,802) (1,324,835) 3,927,782 312,635,093 Total governmental activities net capital assets $ 376,553,091 $ 7,316,344 $ (1,324,835) $ - $ 382,544,600

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
65 Capital Assets for the business-type activities of the City for the year ended June 30, 2025, consisted of the following:

Balance
July 1, 2024 Balance
Asset Description As Reclassified Additions Deletions Transfers June 30, 2025 Business-type activities:

Non-depreciable assets:

Land $ 14,959,482 $ 14,959,482
Intangibles 5,152,998 $ (719) 5,152,279
Work in progress 6,825,731 $ 9,068,914 $ (2,382,626) 13,512,019 Total non-depreciable assets 26,938,211 9,068,914 (719) (2,382,626) 33,623,780 Assets being depreciated/amortized:

Land improvements 10,674,951 10,674,951
Buildings and improvements 75,424,712 218,830 1,879,339 77,522,881 Machinery and equipment 40,012,019 2,212,641 (2,449,930) 33,369 39,808,099 Infrastructure 228,256,890 994,474 (62,017) 469,918 229,659,265 Right-to-use machinery and equipment 272,446 272,446
Right-to-use subscription software 89,649 517,245 (89,649) 517,245 Total assets being depreciated/amortized 354,730,667 3,943,190 (2,601,596) 2,382,626 358,454,887 Accumulated depreciation/amortization:

Land improvements (10,529,119) (18,425) (10,547,544)
Buildings and improvements (44,661,423) (1,604,183) (46,265,606) Machinery and equipment (29,553,465) (1,291,265) 2,404,346 (28,440,384) Infrastructure (130,519,787) (7,208,914) 62,017 (137,666,684) Right-to-use machinery and equipment (72,071) (78,004) (150,075) Right-to-use subscription software (58,204) (66,562) 72,754 (52,012) Total accumulated depreciation/amortization (215,394,069) (10,267,353) 2,539,117 - (223,122,305) Total depreciable/amortizable assets, net 139,336,598 (6,324,163) (62,479) 2,382,626 135,332,582 Total business-type activities net capital assets $ 166,274,809 $ 2,744,751 $ (63,198) $ - $ 168,956,362 Net Capital Assets for both governmental activities and business-type activities of the City at June 30, 2025 are $551,500,962.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
66 The following table presents summary information on infrastructure assets as of June 30, 2025:

Historical Cost Accumulated Balance
Asset Description June 30, 2025 Depreciation June 30, 2025 Governmental activities:

Bridges and box culverts $ 22,255,417 $ (16,148,719) $ 6,106,698 Retention and catch basins 9,081,845 (4,908,095) 4,173,750 Manholes 29,581,714 (14,126,010) 15,455,704
Pavement 131,697,101 (110,563,614) 21,133,487
Pump stations - sewer 1,016,805 (650,098) 366,707
Sewer pipes 17,208,014 (9,252,355) 7,955,659
Sidewalks, curbs and gutters 36,959,151 (32,574,205) 4,384,946 Storm drains and open channels 52,827,077 (37,716,467) 15,110,610 Street lights 17,988,174 (12,309,230) 5,678,944
Traffic signals 13,151,011 (6,384,612) 6,766,399
Total governmental activities 331,766,309 (244,633,405) 87,132,904 Business-type activities:

Water utility 229,659,265 (137,666,684) 91,992,581
Total business-type activities 229,659,265 (137,666,684) 91,992,581 Total infrastructure assets $ 561,425,574 $ (382,300,089) $ 179,125,485 For the year ended June 30, 2025, depreciation and amortization expense on capital assets was charged to the functions of the governmental activities of the City as follows:

Functions/Programs Depreciation/Amortization
Administration $ 544,392
Finance 11,430
Police 1,642,874
Fire 634,510
Public works 10,503,707
Community development 37,106
Housing 91,559
Parks and recreation 892,652
Capital assets held by the government's internal service funds are charged to the various functions based on their usage of the assets 6,529,299 Total Governmental Activities Depreciation/Amortization Expense $ 20,887,529

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
67 For the year ended June 30, 2025, depreciation and amortization expense on capital assets was charged to the business-type activities of the City as follows:

Fund Depreciation/Amortization
Water utility $ 7,566,664
North bay treatment plant 1,689,049
Transportation 688,237
Golf courses 323,403
Total Business-type Activities Depreciation/Amortization Expense $ 10,267,353 7) Accounts Payable and Other Current Liabilities
Accounts payable and other current liabilities as of June 30, 2025 are as follows:

Governmental Activities
Other
Low Mod City Non-Major Total
General Income Capital Governmental Governmental
Current Liabilities Fund Housing Projects Funds Activities Accounts payable $ 11,786,144 $ 132,528 $ 4,180,576 $ 1,789,762 $ 17,889,010 Deposits payable 175,542 1,000 5,195,375 1,000 5,372,917 Total Accounts Payable & Other
Current Liabilities $ 11,961,686 $ 133,528 $ 9,375,951 $ 1,790,762 23,261,927 Add: Internal service current liabilities 886,060
Total Accounts Payable & Other
Current Liabilities $ 24,147,987
Business-type Activities
Non-Major
Fund
North Bay Total
Water Treatment Business-Type
Current Liabilities Utility Plant Transportation Golf Courses Activities Accounts payable $ 2,745,252 $ 704,380 $ 3,500,679 $ 1,010,827 $ 7,961,138 Deposits payable 4,394 541,768 546,162
Total Accounts Payable & Other
Current Liabilities $ 2,745,252 $ 704,380 $ 3,505,073 $ 1,552,595 $ 8,507,300 Major Funds
Major Funds

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
68 8) Long-Term Obligations
The following is a summary of long-term obligation transactions of the City for the year ended June 30, 2025:

Balance
June 30, 2024 Incurred or Satisfied or Balance Due within More than Long Term Obligations As Reclassified Issued Matured June 30, 2025 One Year One Year Governmental Activities:

General obligation bonds $ 5,221,678 $ 421,890 $ 4,799,788 $ 421,890 $ 4,377,898 Pension obligation bonds 23,695,000 1,970,000 21,725,000 2,045,000 19,680,000 Compensated absences* 22,521,855 $ 1,012,265 23,534,120 5,959,065 17,575,055 Claims and judgments payable 19,247,000 6,310,280 5,446,280 20,111,000 4,611,802 15,499,198 Net OPEB liability (Note 15) 115,873 235,266 188,491 162,648 162,648 Net pension liability (Note 14) 220,963,605 24,113,269 26,101,716 218,975,158 218,975,158 Leases (Note 9) 4,650,701 1,669,808 2,980,893 342,388 2,638,505 Subscriptions (Note 10) 7,195,899 1,176,570 2,407,777 5,964,692 1,589,554 4,375,138 Subtotal 303,611,611 32,847,650 38,205,962 298,253,299 14,969,699 283,283,600 Less: Unamortized bond discount (246,306) 24,631 (221,675) (221,675) Total Governmental Activities $ 303,365,305 $ 32,847,650 $ 38,230,593 $ 298,031,624 $ 14,969,699 $ 283,061,925 Business-type Activities:

Utility-Water revenue bonds - principal $ 53,616,289 $ 3,016,599 $ 50,599,690 $ 2,875,410 $ 47,724,280 Utility-Water revenue bonds - accreted interest 35,928,229 $ 3,148,665 3,633,401 35,443,493 788,746 34,654,747 Compensated absences* 2,765,786 52,915 2,818,701 140,936 2,677,765 Net pension liability (Note 14) 27,935,525 5,899,913 3,902,429 29,933,009 29,933,009 Leases (Note 9) 203,053 77,113 125,940 79,687 46,253
Subscriptions (Note 10) 29,254 517,245 136,051 410,448 94,133 316,315 Subtotal 120,478,136 9,618,738 10,765,593 119,331,281 3,978,912 115,352,369 Plus: Unamortized bond premium 2,742,796 152,377 2,590,419 2,590,419 Total Business-type Activities $ 123,220,932 $ 9,618,738 $ 10,917,970 $ 121,921,700 $ 3,978,912 $ 117,942,788 * The change in the compensated absences liability is presented as net change.

The Government Code of the State of California provides for a legal debt limit of 15% of gross assessed valuation.

By law, the general obligation debt subject to the limitation may be offset by amounts set aside for repaying general obligation bonds. This includes the City's General and Pension Obligation bonds. The City is in compliance with this code.

A. General Obligation Bonds
The general obligation bonds are repaid from property tax revenues, and the City is obligated under the law to levy a property tax sufficient to service the debt.

The City has pledged future zone of benefit property tax revenues to pay the Solano County Water Agency for the North Bay Aqueduct project costs. The City is obligated under the agreement to levy a zone of benefit property tax sufficient to service the contractual payments. The debt does not bear interest. The debt is serviced through the Non-major General Obligation Bonds Debt Service Fund. Debt service in fiscal year 2025 amounted to $421,890 and the property tax revenue received to service this debt was $498,115.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
69 The annual debt service requirements for the General Obligation Bonds are as follows:

Fiscal Year
Ending Principal Interest Total
2026 $ 421,890 $ 421,890
2027 421,890 421,890
2028 421,890 421,890
2029 421,890 421,890
2030 421,890 421,890
2031-2035 2,109,450 2,109,450
2036 580,888 580,888
Totals $ 4,799,788 $ - $ 4,799,788
General Obligation Bonds-Governmental Activities
B. Pension Obligation Bonds
The City is a member of the California Public Employees’ Retirement System (PERS), a public employees defined benefit retirement program. In fiscal year 2005, the City issued $41,745,000 in order to refinance the City’s unamortized, unfunded actuarial accrued liability with PERS (see Note 14 for more information on PERS pension plan). Series 2004 A was a variable rate debt in the face amount of $8,920,000; series 2004 B was a fixed rate debt and was issued in the face amount of $20,995,000; and series 2005 A2 was variable rate debt and was issued in the face amount of $11,830,000. In FY 2011, the City issued the 2011 series of pension obligation bonds in the amount of $15,870,000 to fully refund and retire both variable rate series bonds: Series 2004 A in the amount of $8,920,000 and series 2005 A2 in the amount of $6,430,000. In FY 2015, the City issued $21,835,000 in refunding bonds to refinance $20,810,000 that was outstanding in the Pension Obligation Series 2004 B series of bonds. The 2015 bonds were issued at a range of interest rates ranging from 1% to 4.75%. These bonds mature in 2034. Under the Indenture of Trust related to the bonds, the remedies for an event of default include compulsion of the City to comply with its obligations, including the payment of debt service, and any other remedies available under law or equity.

On December 4, 2018, to take advantage of lower interest rates, the City issued the 2018 series of pension obligation bonds in the amount of $15,325,000 to fully refund the $13,315,000 that was outstanding in the 2011 Series bonds. The 2011 bonds had interest rates ranging from 7.08% to 8.5%, while the 2018 series bonds bear interest at rates ranging from 2.85% to 4.36%. The maturity date of the bonds remained the same at 2034.

The 2015 series bonds have an outstanding balance of $12,020,000 while the 2018 series bonds currently have an outstanding amount of $9,705,000. These Pension Obligation Bonds (POB’s) are backed by the full faith and credit of the City. All pension obligation bonds are federally taxable. Under the Indenture of Trust related to the bonds, the remedies for an event of default include compulsion of the City to comply with its obligations, including the payment of debt service, and any other remedies available under law or equity.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
70 As of June 30, 2025, the amount of accrued interest payable in the Government Wide Statement of Net Position is $78,018. At June 30, 2025, the outstanding balance is $21,725,000. The debt is serviced through the debt service fund and the annual debt service requirements for the POB’s are as follows:

Fiscal Year
Ending Principal Interest Total
2026 $ 2,045,000 $ 936,213 $ 2,981,213
2027 2,120,000 859,820 2,979,820
2028 2,205,000 776,749 2,981,749
2029 2,295,000 687,842 2,982,842
2030 2,390,000 592,282 2,982,282
2031-2034 10,670,000 1,244,801 11,914,801
Totals $ 21,725,000 $ 5,097,707 $ 26,822,707
Pension Obligation Bonds-Governmental Activities
C. Utility-Water Revenue Bonds
In November 2007, the City issued $84,466,697 in revenue bonds with interest rates ranging from 4.66% to 5.01% to finance the modernization of the current treatment plant and the construction of water distribution systems.

The City has pledged future water customer revenues, net of specified operating expenses to repay the $84.5 million in water revenue bonds. In FY 2017, $43,610,000 of these bonds were refunded (see 2017 Water Refunding Revenue Bonds). This includes total principal and interest remaining to be paid on the bonds is $40,856,697 and $73,703,302, respectively. The remaining outstanding amount of the 2007 bonds are capital appreciation bonds in the originally issued principal amount of $40,856,697. The $73,703,302 in interest represents an amount of accreted interest (to be accreted over the period between 2007 and 2038) and began paying down in 2021. Annual principal and interest payments on the bonds are expected to require less than 53% of net revenues in 2025 and in future years. As of June 30, 2025, the total principal remaining to be paid on the bonds is $26,099,690 and $35,443,493 of interest has been accreted to date. In the current fiscal year, the amount added to the accreted interest payable was $3,148,665. The outstanding certificates of participation were executed and delivered by The Bank of New York Mellon Trust Company, N.A, as trustee, and evidence of interests in installment payments made by the City under an Installment Sale Agreement. The City’s obligation to pay installment payments is secured by a pledge of the net revenues of the City’s water enterprise. In the event of a default by the City under the Installment Sale Agreement, the Trustee has the right to exercise any remedy available under law or equity, including declaring all principal components of the unpaid installment payments, together with accrued interest at a default rate, to be immediately due and payable.

In April 2017, the City issued $40,320,000 in revenue bonds with interest rates ranging from 3.0% to 5.0% to defease and refund on a current basis the term and serial components of the Water Enterprise 2007 Revenue Bonds. The issuance premium is reported in long-term debt due on the balance sheet and will be amortized over the next 20 years (the remaining life of the bonds). As of June 30, 2025, the balance of the premium is $2,590,419.

The City has pledged future water customer revenues, net of specified operating expenses to repay the $40.3 million in water revenue bonds. Net customer revenues in the current year were $9,136,631. Under the Indenture of Trust for the bonds, the remedies for an event of default include any remedy available under law or equity, including declaring the principal amount of any outstanding 2017 Bonds, together with accrued interest, to be immediately due and payable. The total principal and interest remaining to be paid on the bonds is $24,500,000 and $17,609,344, respectively. As of June 30, 2025, the amount of accrued interest payable is $296,052.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
71 At June 30, 2025, the water revenue bonds consist of the following:

Bond Issue Bonds Outstanding
2007 Water Revenue Bonds - principal $ 26,099,690
2007 Water Revenue Bonds - accreted interest 35,443,493 2017 Water Refunding Revenue Bonds 24,500,000
Total Water Revenue Bonds $ 86,043,183
The debt service requirements on the utility water revenue bonds are as follows:

Fiscal Year
Ending Principal (1) Interest Total
2026 3,664,156 4,963,796 $ 8,627,952
2027 3,836,567 5,098,708 8,935,275
2028 4,018,892 5,224,039 9,242,931
2029 4,216,650 5,338,621 9,555,271
2030 4,420,035 5,451,096 9,871,131
2031-2035 25,586,741 28,706,942 54,293,683
2036-2040 28,925,142 20,106,202 49,031,344
2041-2042 11,375,000 860,250 12,235,250
Total $ 86,043,183 $ 75,749,654 $ 161,792,837
(1) Includes accreted interest.

Utility-Water Revenue Bonds-Business-type Activities
D. Compensated Absences
The City’s vested and unpaid compensated absences for the governmental activities are accounted for in the Compensated Absences Internal Service fund. As of June 30, 2025, the outstanding liability for the governmental activities is $23,534,120. As for the City’s business-type activities, the liabilities for the vested and unpaid compensated absences are accounted by activity and the total as of June 30, 2025 is $2,818,701. The current portion of this liability is $5,959,065 for the governmental activities, and $140,936 for the business-type activities funds, and has been determined based on recent payout history.

E. Arbitrage
The Tax Reform Act of 1986 instituted certain arbitrage restrictions concerning the issuance of tax-exempt bonds after August 31, 1986. Arbitrage regulations deal with the investment of all tax-exempt bond proceeds at an interest yield greater than the interest yield paid to bondholders. Generally, all interest paid to bondholders can be retroactively rendered taxable if applicable rebates are not reported and paid to the U.S. Treasury at least every five years. The City has evaluated each bond issued subject to the arbitrage requirements and has determined that no arbitrage liability exists as of June 30, 2025. The City has complied with all significant bond covenants relating to reserve and sinking fund requirements.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
72 9) Leases
A. Lease Receivable

1. Governmental Activities
As of June 30, 2025, the City had sixteen active lease agreements as the lessor where it had leased its land and buildings. As of June 30, 2025, the outstanding lease receivables total to $15,980,904. These leases require the various lessees to make periodic payments to the City, and range in interest rates from 1.0586% to 4.3260%. The offsetting entry to the lease receivable is a deferred inflow and the value of the deferred inflows at June 30, 2025, is $14,349,020. The City will be systematically recognizing revenue over the terms of the leases, and in the current fiscal year, the City recognized $296,266 in lease principal and $406,296 in interest. Final receipt is expected in fiscal year 2053.

2. Business-type Activities
As of June 30, 2025, the City had three active lease agreements as the lessor where it had leased its land. As of June 30, 2025, the outstanding lease receivables total to $1,981,053. These leases require the various lessees to make periodic payments to the City, and range in interest rates from 1.7870% to 4.3260%. The offsetting entry to the lease receivable is a deferred inflow and the value of the deferred inflows at June 30, 2025, is $1,919,950. The City will be systematically recognizing revenue over the terms of the leases, and in the current fiscal year, the City recognized $63,282 in lease principal and $48,721 in interest. Final receipt is expected in fiscal year 2047.

B. Lease Payable

1. Governmental Activities
As of June 30, 2025, the City had seven active lease agreements as the lessee for the use of various buildings and pieces of equipment. As of June 30, 2025, the value of the lease liability outstanding is $2,980,893. The City is required to make monthly fixed payments, and these leases have interest rates ranging from 0.8927% to 4.4790%.

These right-to-use lease assets are recognized as Capital Assets (see Note 6), and the value of the right-to-use lease assets as of June 30, 2025, is $4,611,177, with accumulated amortization of $1,462,036.

The future principal and interest lease payments as of June 30, 2025, were as follows:

Fiscal Year
Ending Principal Interest Total
2026 $ 342,388 $ 112,716 $ 455,104
2027 310,986 102,416 413,402
2028 267,078 92,962 360,040
2029 276,454 83,585 360,039
2030 286,177 73,862 360,039
2031-2035 827,769 249,105 1,076,874
2036-2039 670,041 76,672 746,713
Totals $ 2,980,893 $ 791,318 $ 3,772,211

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
73 2. Business-type Activities
As of June 30, 2025, the City had six active lease agreements as the lessee for the use of various pieces of vehicle equipment. As of June 30, 2025, the value of the lease liability outstanding is $125,940. The City is required to make monthly fixed payments, and these leases have interest rates ranging from 2.464% to 3.409%. These rightto-use lease assets are recognized as Capital Assets (see Note 6), and the value of the right-to-use lease assets as of June 30, 2025, is $272,446, with accumulated amortization of $150,075.

The future principal and interest lease payments as of June 30, 2025, were as follows:

Fiscal Year
Ending Principal Interest Total
2026 $ 79,687 $ 2,847 $ 82,534
2027 40,074 545 40,619
2028 6,179 51 6,230
Totals $ 125,940 $ 3,443 $ 129,383
10) Subscription-Based Information Technology Arrangements (SBITAs) A. Governmental Activities

As of year-end June 30, 2025, the City had twenty-four active subscriptions for the use of various software. As of June 30, 2025, the value of the total subscription liability outstanding is $5,964,692. The City is required to make annual fixed payments, and these subscriptions have interest rates ranging from 2.0237% to 4.4790%. The right-touse subscription IT assets are recognized as Capital Assets (see Note 6), and the value of the right-to-use subscription assets as of June 30, 2025, is $14,961,455 with accumulated amortization of $6,925,130.

The future principal and interest subscription payments as of June 30, 2025, were as follows:

Fiscal Year
Ending Principal Interest Total
2026 $ 1,589,554 $ 116,099 $ 1,705,653
2027 884,619 66,756 951,375
2028 686,297 34,714 721,011
2029 316,142 21,121 337,263
2030 300,629 10,500 311,129
2031-2035 1,108,321 35,392 1,143,713
2036-2040 1,079,130 10,892 1,090,022
Totals $ 5,964,692 $ 295,474 $ 6,260,166
B. Business-type Activities

As of year-end June 30, 2025, the City had one active subscription for the use of Swiftly software. As of June 30, 2025, the value of the subscription liability outstanding is $410,448. The City is required to make annual fixed payments, and this subscription has an interest rate of 2.5110%. The right-to-use subscription asset is recognized as a Capital Asset (see Note 6), and the value of the right-to-use subscription asset as of June 30, 2025, is $517,245, with accumulated amortization of $52,012.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
74 The future principal and interest subscription payments as of June 30, 2025, were as follows:

Fiscal Year
Ending Principal Interest Total
2026 $ 94,133 $ 10,306 $ 104,439
2027 99,629 7,943 107,572
2028 105,358 5,441 110,799
2029 111,328 2,795 114,123
Totals $ 410,448 $ 26,485 $ 436,933
11) Risk Management and Insurance
The City is exposed to various risk of torts, theft of, damage to, and destruction of assets, errors and omissions, injuries to employees and natural disasters. The City is partially self-insured for workers’ compensation insurance with a $750,000 retention per occurrence and general liability coverage with a $750,000 retention per occurrence and is a member of joint power authorities for the coverage above and beyond the retention levels (see below).

The City is completely self-insured for unemployment insurance, short-term disability insurance, other postemployment benefits (OPEB), vision and dental insurance coverage programs. All funds participate in the City’s risk management program. The expenses of the self-insurance programs are recorded in the Insurance Internal Service Fund. In 2024, an independent actuary performed an analysis of the City’s self-insured workers’ compensation reserves and general liability reserve (i.e. payable claims); this actuarial analysis is performed every two years for these two liability accounts. For fiscal years 2025 and 2024, estimates for incurred but not reported claims (IBNR) are included in the liability estimates recommended by the actuary. Based on the analysis, which used a rate of 1.5% to discount future investment earnings at a 75% confidence level, the City’s worker’s compensation actuarial liability at June 30, 2025 is $13,328,000 and the general liability actuarial liability is $6,783,000.

The changes in balances of claims liabilities during the past years for the General Liability and Workers’ Compensation fund combined are as follows:

Claims Liability FY 24/25 FY 23/24
Beginning of Fiscal Year $ 19,247,000 $ 14,616,000
Incurred Claims including IBNR's 6,310,280 10,098,799
Claims Payments (5,446,280) (5,467,799)
End of Fiscal Year $ 20,111,000 $ 19,247,000
For worker’s compensation, the City purchases excess insurance coverage (above and beyond the retention limit of $750,000) from a governmental joint powers authority up to statutory limits per occurrence. PRISM, which stands for Public Risk Innovation, Solutions, and Management, is a risk-sharing pool of California public agencies, dedicated to controlling losses and providing effective risk management. In 1979, 29 California counties came together to form this joint powers authority in order to pool their risk and provide a viable and cost effective solution for the counties’ insurance and risk management needs. Since then, PRISM’s membership has expanded to include 95% of the counties in California and nearly 70% of the cities, as well as numerous school districts, special districts, housing authorities, fire districts, and other Joint Powers Authorities. PRISM is a separate legal entity and is governed by a 61-member Board of Directors. Members are assessed a contribution for each program in which they participate (for the City of Fairfield, this is the Excess Workers’ compensation program).

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
75 Members may be subject to additional supplemental assessments if it is determined that contributions are insufficient. If it is determined that excess contributions are available, a dividend may be declared. Separate financial statements may be obtained from PRISM’s website at https://www.prismrisk.gov/resources/prismdocuments/.

For general liability, the City is a member of the California Joint Powers Risk Management Authority (CJPRMA), a joint powers authority which provides the City with $40,000,000 liability coverage over and above the self-insured retention of $750,000. A property insurance policy is purchased by the member entities of CJPRMA with a deductible of $250,000 per loss. The CJPRMA is a legal entity separate and distinct from its member entities, as permitted by the California Government Code. CJPRMA is governed by a 17-member Board of Directors appointed by the member agencies. Member agencies include approximately 72 Cities, 1 County, 1 Unified School District and 16 special districts. The purpose of the CJPRMA is to spread the adverse effects of losses among the member agencies and to provide excess coverage as a pool, spreading the overall risk among the member entities. Should actual losses among participants be greater than the anticipated losses, the City will be assessed its pro rata share of that deficiency. Conversely, if actual losses are less than anticipated, the City will be refunded its pro rata share of the excess. Separate financial statements may be obtained from the CJPRMA website at https://main.cjprma.org/resources/documents/financials. For both programs, there have been no insurance settlements that have exceeded insurance coverage in each of the last three years. 12) Classification of Net Position
In the Government-Wide Financial Statements, net position is classified into the following categories:

A. Net Investment in Capital Assets - This category groups all capital assets, net of accumulated depreciation and related debt, into one component of net position, as noted below.

Governmental Business-Type
Activities Activities Totals
Total Capital Assets:

Capital Assets $ 804,052,799 $ 392,078,667 $ 1,196,131,466 Less: Accumulated Depreciation/Amortization (421,508,199) (223,122,305) (644,630,504) Net Carrying Value of Capital Assets 382,544,600 168,956,362 551,500,962 Less:

Long Term Debt Applicable to Capital Assets:

General Obligation Bonds (4,799,788) (4,799,788)
Leases (2,980,893) (125,940) (3,106,833)
Subscriptions (5,964,692) (410,448) (6,375,140)
Utility Water Revenue Bonds (including unamortized bond premium) (53,190,109) (53,190,109) Related Retainage and Accounts Payable (3,087,703) (669,008) (3,756,711) Total (16,833,076) (54,395,505) (71,228,581)
-
Net Investment in Capital Assets* $ 365,711,524 $ 114,560,857 $ 480,272,381 *There are no unspent bond proceeds or deferred charges on refunding on long term debt related to capital assets.

B. Restricted Net Position – This category presents external restrictions imposed by creditors, grantors, contributors (Outreach Independence), or laws or regulations of other governments (3rd parties) and restrictions imposed by law through constitutional provisions or enabling legislation. The restrictions are categorized in the governmental activities by General Fund, Capital Projects, Debt Service, Community Development Programs, and specific projects, and in the business-type activities by Debt Service, Major Maintenance, and Minority Interest.

C. Unrestricted Net Position – This category represents the net position of the City, which is not restricted for any project or other purpose.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
76 13) Fund Balances
The City’s Fund Balances for Governmental funds are presented as follows:

Non-Major Total
General Low Mod City Governmental Governmental
Fund Balances Fund Income Housing Capital Projects Funds Funds Nonspendable
Prepaids $ 144,536 $ 2,905 $ 36,726 $ 184,167
Outreach independence 335,375 335,375
Total 144,536 2,905 $ - 372,101 519,542
Restricted
Pension trust (PARS) 7,879,759 7,879,759
Special revenue:

Housing assistance 92,918 92,918
Streets and parks 13,564,201 13,564,201
Housing and special projects 36,100,779 38,509,719 74,610,498 Debt service 1,098,002 1,098,002
Capital projects 51,167,182 27,454,369 78,621,551
Outreach Independence 81,126 81,126
Total 7,879,759 36,100,779 51,167,182 80,800,335 175,948,055 Committed
General fund reserve @20% 29,777,728 29,777,728
Pension stabilization 3,744,365 3,744,365
Capital projects 22,539,691 22,539,691
Total 33,522,093 - - 22,539,691 56,061,784
Assigned
Contingency 500,000 500,000
Infrastructure/Facilities 201,500 201,500
Vehicle Replacement 80,600 80,600
Capital projects 5,958,978 5,958,978
Pension obligation bonds 1,537,526 1,537,526
Total 782,100 - 5,958,978 1,537,526 8,278,604
Unassigned
Market Value Interest (GASB 31) 414,597 414,597
Unassigned fund balance 14,517,044 14,517,044
Total Unassigned 14,931,641 - - - 14,931,641
Total Fund Balances $ 57,260,129 $ 36,103,684 $ 57,126,160 $ 105,249,653 $ 255,739,626 Major Funds
Included in the restricted fund balance for the Low Mod Income Housing Special Revenue Fund, there are approximately $30,991,898 of loans receivable that are not anticipated to be collected within the next year. In the non-major governmental funds (HOME, CDBG, and NSP) fund balance, there is approximately $17,159,568 of loans receivable that are not anticipated to be collected within the next year.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
77 14) Retirement Plans
A. Pension Plan

1. General Information about the Pension Plans
i. Plan Description – The City contributes to the California Public Employees Retirement System (CalPERS), an agent multiple-employer system that acts as a common investment and administrative agent for participating public entities within the state of California. All qualified permanent and probationary employees are eligible to participate in the City’s separate Safety (police and fire) and Miscellaneous (all other) Plans. 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 at www.calpers.ca.gov.
ii. Benefits Provided - CalPERS provides 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. Classic miscellaneous, classic safety and PEPRA safety members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. PEPRA miscellaneous members with five years of total service are eligible to retire at age 52 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.

The Plans’ provisions and benefits in effect at June 30, 2024, are summarized as follows:

Plan Classic Plan Tier II PEPRA
Hire Date Prior to 8/26/2012 On or After 8/26/2012 On or After 1/1/2013 Formula 2.7% @ 55 2.5% @ 55 2% @ 62
Benefit vesting schedule 5 years of service 5 years of service 5 years of service Benefit payments monthly for life monthly for life monthly for life Retirement age 50-55 50-55 52-67
Monthly benefits, as a % of annual salary 2.0% to 2.7% 2.0% to 2.5% 1.0% to 2.5% Required employee contribution rates 10.50% 10.50% 7.75% Required employer contribution rates 9.28% 9.28% 11.78% Required employer unfunded liability contribution $9,649,455 Plan Classic Plan Tier II PEPRA
Hire Date Prior to 8/26/2012 On or After 8/26/2012 On or After 1/1/2013 Formula 3% @ 50 3% @ 55 2.7% @ 57
Benefit vesting schedule 5 years of service 5 years of service 5 years of service Benefit payments monthly for life monthly for life monthly for life Retirement age 50 50-55 50-57
Monthly benefits, as a % of annual salary 3.0% 2.4% to 3.0% 2.0% to 2.7% Required employee contribution rates 11.25% 11.25% 11.25% Required employer contribution rates 19.64% 19.64% 19.64% Required employer unfunded liability contribution $7,716,296 Miscellaneous
Safety

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
78 Employees Covered - At valuation date of June 30, 2023, the following employees were covered by the benefit terms for each Plan:

Employees Covered Miscellaneous Safety Total
Inactive employees or beneficiaries
currently receiving benefits 615 263 878
Inactive employees entitled to but not yet
receiving benefits 413 81 494
Active employees 382 192 574
Totals 1,410 536 1,946
iii. Contributions - Section 20814(c) of the California Public Employees’ Retirement law requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in 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 rates of employees. As of June 30, 2025, the average employee contribution rate for miscellaneous and safety plan are 7.582% and 9.503% of annual pay, respectively, and employer’s contribution rate for miscellaneous and safety plan are 44.85% and 53.96% of annual pay, respectively. For the fiscal year ended June 30, 2025, the employer contributions were $14,958,441 for miscellaneous and $15,148,097 for safety, respectively.

2. 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 of the Plans is measured as of June 30, 2024, using an annual actuarial valuation as of June 30, 2023, rolled forward to June 30, 2024. The General Fund, in the governmental activities, and the Water, Transportation, and North Bay Regional Water enterprise funds are the primary funds used to liquidate the pension liabilities. A summary of principal assumptions and methods used to determine the net pension liability is shown below.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
79 i. Actuarial Assumptions - The total pension liabilities in the June 30, 2023, actuarial valuations were determined using the following actuarial assumptions.

Provision
Valuation Date
Measurement Date
Actuarial Cost Method
Actuarial Assumptions:

Discount Rate
Inflation
Payroll Growth
Projected Salary Increase
Mortality (1)
Post Retirement Benefit Increase
Miscellaneous & Safety
Varies by entry age and service
The lesser of contract COLA or 2.30% until Purchasing
Power Protection Allowance floor on purchasing
power applies, 2.30% thereafter
(1) 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 from November 2021 that can be found on the CalPERS website.

Derived using CalPERS' Membership Data for all Funds
June 30, 2023
June 30, 2024
Entry-Age
Normal Cost Method

6.90%

2.30%

2.80%

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
80 ii. Discount Rate - The discount rate used to measure the total pension liability was 6.90%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

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 of 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.

The expected real rates of return by asset class are as follows:

Asset Class Target Allocation Real Return (1) (2)
Global Equity - Cap-weighted 30% 4.54%
Global Equity - Non-Cap-weighted 12% 3.84%
Private Equity 13% 7.28%
Treasury 5% 0.27%
Mortgage-backed Securities 5% 0.50%
Investment Grade Corporates 10% 1.56%
High Yield 5% 2.27%
Emerging Market Debt 5% 2.48%
Private Debt 5% 3.57%
Real Assets 15% 3.21%
Leverage -5% -0.59%
Total 100%
(1) An expected inflation of 2.30% used for this period. (2) Figures are based on the 2021 Asset Liability Management study.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
81 iii. Changes in the Net Pension Liability - The changes in the net pension liability for each Plan for the measurement date June 30, 2024, are as follows:

Miscellaneous Plan:

Total Pension
Liability
Plan Fiduciary Net
Position
Net Pension
Liability/(Asset)
Balance at June 30, 2023 $ 416,161,847 $ 282,229,900 $ 133,931,947 Changes in the year:

Service cost 6,724,100 6,724,100
Interest on the total pension liability 28,730,811 28,730,811 Changes of benefit terms -
Differences between expected and actual experience 8,793,003 8,793,003 Contribution - employer 13,391,833 (13,391,833)
Contribution - employee 3,235,450 (3,235,450)
Projected investment income 19,206,068 (19,206,068)
Differences between projected and actual earnings on plan investments 7,850,954 (7,850,954)
Benefit payments, including refunds of employee contributions (23,856,644) (23,856,644) - Administrative expenses (229,651) 229,651
Net changes 20,391,270 19,598,010 793,260
Balance at June 30, 2024 $ 436,553,117 $ 301,827,910 $ 134,725,207 Safety Plan:

Total Pension
Liability
Plan Fiduciary Net
Position
Net Pension
Liability/(Asset)
Balance at June 30, 2023 $ 409,305,438 $ 294,338,255 $ 114,967,183 Changes in the year:

Service cost 9,156,911 9,156,911
Interest on the total pension liability 28,327,317 28,327,317 Changes of benefit terms -
Differences between expected and actual experience 6,728,294 6,728,294 Contribution - employer 13,863,617 (13,863,617)
Contribution - employee 3,228,869 (3,228,869)
Projected investment income 20,183,458 (20,183,458)
Differences between projected and actual earnings on plan investments 7,960,305 (7,960,305)
Benefit payments, including refunds of employee contributions (20,142,692) (20,142,692) - Administrative expenses (239,504) 239,504
Net changes 24,069,830 24,854,053 (784,223)
Balance at June 30, 2024 $ 433,375,268 $ 319,192,308 $ 114,182,960 Totals of both Miscellaneous and Safety Plans $ 869,928,385 $ 621,020,218 $ 248,908,167 Increase (Decrease)
Increase (Decrease)

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
82 iv. 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:

Scenario/Effect on Liability
Miscellaneous
Plan
Safety
Plan Total
1% Decrease 5.90% 5.90% 5.90%
Net Pension Liability $ 190,098,732 $ 174,596,882 $ 364,695,614 Current Discount Rate 6.90% 6.90% 6.90%
Net Pension Liability $ 134,725,207 $ 114,182,960 $ 248,908,167 1% Increase 7.90% 7.90% 7.90%
Net Pension Liability $ 88,889,382 $ 64,697,003 $ 153,586,385 v. Pension Plan Fiduciary Net Position - Detailed information about each pension plans’ fiduciary net position is available in the separately issued CalPERS financial reports.

3. Pension Expense and Deferred Outflows/Inflows of Resources Related to Pensions For the year ended June 30, 2025, the City recognized pension expense of $23,672,115 and $21,986,654 for the Miscellaneous and Safety Plan, respectively, for a total of $45,658,769. At June 30, 2025, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Pension contributions subsequent
to measurement date $ 14,958,441 $ 15,148,097 $ 30,106,538 Differences between actual and
expected experience 7,615,996 4,655,561 $ (6,162) 12,271,557 $ (6,162) Changes in assumption 9,147,593 9,147,593
Change in proportion 2,111,069 $ (2,111,069) 2,111,069 (2,111,069) Net differences between
projected/actual earnings on plan
investments 4,205,684 4,725,619 8,931,303
Totals $ 28,891,190 $ (2,111,069) $ 33,676,870 $ (6,162) $ 62,568,060 $ (2,117,231) Miscellaneous Plan Safety Plan Total
The amount of $14,958,441 and $15,148,097 for the Miscellaneous and Safety Plans, respectively, is reported as deferred outflows of resources related to contributions subsequent to the measurement date and will be recognized as a reduction of the net pension liability in the year ended June 30, 2026.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
83 The amount reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:

Fiscal Miscellaneous Safety
Year Ended Plan Plan Total
2026 4,315,726 $ $ 6,368,566 $ 10,684,292
2027 10,306,971 11,613,742 21,920,713
2028 (1,230,830) 1,254,762 23,932
2029 (1,570,187) (714,459) (2,284,646)
Total $ 11,821,680 $ 18,522,611 $ 30,344,291
B. Defined Contribution Plans
The City also provides defined contribution retirement benefits through the City of Fairfield 401(a) plan as well as a 457 plan. Benefit terms, including contribution requirements, are established, and may be amended by the City Council. The City and its employees contribute to this plan in accordance with the terms of the employees’ Memorandums of Understanding (MOU’s). In addition, for the 457 plans, employees are permitted to make voluntary contributions to the plan, up to applicable Internal Revenue Code limits. Employees are immediately vested in these contributions and the earnings on those contributions. Employer liabilities are limited to the amount of current contributions. For the year ended June 30, 2025, the City recognized an expense of $3,212,489 for the employer contribution to the 401a and 457 plans.

C. Other Retirement Systems
The Omnibus Budget Reconciliation Act of 1990 (OBRA) mandates that public sector employees who are not members of their employer’s existing retirement system as of January 1, 1992, be covered by either Social Security or an alternative plan. The City contracts with the Public Agency Retirement System (PARS), to maintain a defined contribution plan that covers part-time, seasonal, and temporary employees. Employer liabilities are limited to the amount of current contributions.

Under PARS, employees contribute 6.2% and the City contributes 1.3% of the employee’s salary each pay period.

For the fiscal year ended June 30, 2025, total contributions of $11,734 were made based on a total amount of covered compensation of $902,641.

Certain part-time employees have elected to be covered under Social Security, which requires these employees and the City to each contribute 6.2% of the employee’s salary. For the fiscal year ended June 30, 2025, total contributions of $5,879 were made based on a total amount of covered compensation of $94,823. 15) Other Post-Employment Benefits (OPEB)
A. General Information about the OPEB Plans

1. Plan Description
The City's Retiree Health Plan is a single employer defined benefit healthcare plan. The City provides postretirement health care benefits to certain retired executive management employees and retired City officials as approved by City resolution. Eligibility requirements include: (1) age 53 with 10 or more years of service with the City and; (2) provide a minimum of 4 years of service as an executive management employee; and receipt of Public Employees Retirement System (PERS) benefits. The eligible official/employee must elect to be included in this program immediately upon retirement. The City does not

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
84 issue a separate, stand-alone financial report for its OPEB plan. The City’s Retiree Insurance (OPEB) Internal Service Fund is used to liquidate the net OPEB liability. The City has established a trust with CalPERS California Employers’ Retiree Benefit Trust (CERBT) for the purpose of accumulating funding for OPEB obligations. The CERBT is a Section 115 OPEB Trust and is an agent multiple employer plan for those electing to prefund their OPEB obligations. As of the measurement date of June 30, 2024, this trust had accumulated assets of $1,842,423.

2. Employees covered
There are twenty-one retired individuals covered under this program as of June 30, 2025. The plan is closed, and all twenty-one retirees are receiving benefits.

3. Contributions
For the executive management group discussed above, the City pays a subsidy towards the medical and dental premiums for retirees and their dependents. The subsidy is limited to the premium amount that is for the lowest cost medical and dental plans available. During the year ended June 30, 2025, the City made no contributions to the CERBT trust.

B. Net OPEB Liability

1. Actuarial Assumptions
The net OPEB liabilities in the June 30, 2024 actuarial valuation were determined using the following actuarial assumptions:

Valuation Date
Measurement Date
Measurement Period July 1, 2023 to June 30, 2024
Actuarial Assumptions:

Discount Rate
Inflation
Salary Increases N/A
Mortality Rate 2021 CalPERS's Experience Study
Healthcare Trend Rate
Provisions
June 30, 2024
June 30, 2024

5.25%

2.50%

8.0% in 2026, step down to 5.9% by 2076

2. Discount Rate
The discount rate of 5.25% was used to calculate the net OPEB liability for the measurement date June 30, 2024. 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.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
85 The table below reflects long-term expected real rate of return by asset class.

Asset Class
Target
Allocation
Real Return
Years 1-5
Real Return
Years 6+
Global Equity 34.0% 3.90% 4.70%
Fixed Income 41.0% 2.70% 2.60%
Global Real Estate 17.0% 3.70% 4.00%
Treasury Inflation Protected Securities 5.0% 1.70% 1.40% Commodities 3.0% 2.90% 2.00%
Total 100%

3. Changes in the Net OPEB Liability
The changes in the net OPEB liability for the Plan as of the measurement date June 30, 2024 are as follows:

Total OPEB Liability
Plan Fiduciary Net
Position
Net OPEB
Liability/(Asset)
Balance at June 30, 2023 $ 1,994,226 $ 1,878,353 $ 115,873 Changes in the year:

Interest on the Total OPEB Liability 99,749 99,749
Expected Investment Income 93,650 (93,650)
Administrative Expenses (611) 611
Benefit Payments (188,491) (188,491) -
Changes in Assumption (61,904) (61,904)
Difference between expected and actual plan experience 161,491 161,491 Difference between projected and actual earnings on
Investments 59,522 (59,522)
Net Changes 10,845 (35,930) 46,775
Balance at June 30, 2024 $ 2,005,071 $ 1,842,423 $ 162,648

4. Sensitivity of the Net OPEB Liability to Changes in the Discount Rate

The following presents the net OPEB liability of the City if it were calculated using a discount rate this is one percent lower or one percent higher than the current rate:

Plan
1% Decrease
(4.25%)
Current
Discount Rate
(5.25%)
1% Increase
(6.25%)
Net OPEB Liability/(Asset) $ 357,320 $ 162,648 $ (3,859)

5. Sensitivity of the Net OPEB Liability to Changes in Health Care Cost Trend Rates The following presents the net OPEB liability of the City if it were calculated using healthcare cost trend rates that are one percent lower or one percent higher than the current rate:

Plan
1% Decrease
(7.0%)
Cost
Trend Rate
(8.0%)
1% Increase
(9.0%)
Net OPEB Liability/(Asset) $ 5,347 $ 162,648 $ 342,461

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
86 6. OPEB Expense and Deferred Outflows and Inflows of Resources Related to OPEB Gains and losses related to changes in net OPEB liability are recognized in OPEB expense systematically over time.

Amounts are first recognized in OPEB expense for the year the gain and loss occur. The remaining amounts are categorized as deferred outflows of resources related to OPEB and are to be recognized in the future OPEB expense.

The recognition period differs depending on the source of the gain or loss. Net difference between projected and actual earnings on OPEB plan investments are amortized over 5 years and all others are amortized over the expected average remaining service lifetime, which is 0 years at June 30, 2025, since there are no active members. For the year ended June 30, 2025, the City recognized OPEB expense of $128,808.

At June 30, 2025, the City reported deferred outflows of resources and deferred inflow of resources related to OPEB from the following sources:

Deferred Outflows of
Resources
Deferred Inflow of
Resources
Net difference between projected and
actual earnings on investments $ 90,240
Total $ 90,240 $ -
The deferred outflows of resources related to OPEB will be recognized as OPEB expense as follows:
2026 $ 21,952
2027 86,426
2028 (6,232)
2029 (11,906)
Total $ 90,240
Fiscal Year Ended
16) Tax Abatements - Economic Development Incentives
GASB Statement No. 77 defines tax abatements as resulting from an agreement between a government and an individual or entity in which the government promises to forgo tax revenues and the individual or entity promises to subsequently take a specific action that contributes to economic development or otherwise benefits the government or its citizens. According to the GASB 77, the substance of these agreements meet the definition of “tax abatements” as the revenues received were not available for general municipal services purposes, but rather used to effectively reduce the net tax liability of certain taxpayers per the conditions of an agreement. The taxes paid to the City are included in the revenue reported in these financial statements and the payments made to the businesses based upon the taxes paid are also included as expenditures in these financial statements.

The City offers an economic development incentive program to the entities that propose to locate or expand already established businesses within the City. This incentive program is expected to provide a stimulus to the City's economy, increase the tax base and create jobs. Each of the agreements entered into by the City, provides for a rebate of taxes paid to the City according to formulas contained in the agreements. These limited terms agreements provide for a sharing of the taxes (percentage rebates) above certain amounts with a maximum rebate not to exceed the cost of a business’ improvements and/or development impact fees. The City generally expects to

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
87 receive increased revenue as a result of these agreements. These incentive agreements require approval by City Council. The term of eligibility under these agreements, approved by City Council, will expire on March 31, 2028.

For the fiscal year ended June 30, 2025, under this program the City had abatements of sales tax totaling $1,651,150. Pursuant to the Sales and Use Tax law (chapter 8 – Article 1 – section 7056), in order to protect the confidential information of sales taxes collected and abatements provided to each of the specific agencies, the City has presented the aggregate amount abated during the current fiscal year. 17) Commitments and Contingent Liabilities
Various claims and lawsuits are pending against the City. Although the outcome of these claims and lawsuits is not presently determinable, in the opinion of the City’s management, on the advice of legal counsel, it is unlikely that they will have a material adverse effect on the accompanying financial statements.

The City and the Housing Authority have received federal and state grants for specific purposes that are subject to review and audit by the grantor agencies. Such audits could lead to a request for reimbursement for expenditures disallowed under the terms of the grant. The amount, if any, of expenditure that may be disallowed by the granting agencies cannot be determined at this time, although the City expects such amounts, if any, to be immaterial.

A. Other Development Agreements
The City has entered into several agreements with various developers who are developing numerous residential and commercial projects throughout the City. The City agreed to grant the developers’ development fee credits since the developers constructed (or have agreed to construct) certain public improvements beyond what was needed to serve their specific projects. The value of the credits as of June 30, 2025, was $10,934,706. This amount does increase for inflation but does not accrue interest. The accounting for the amounts due are not recorded as liabilities since the payments (the uses of credits) are contingent upon the pulling of future building permits (from building growth that has not yet occurred).

B. Golf Courses Contingent Advances from Other Funds

In the 2014 Financial Statements, the Business-type activities golf courses funds showed advances from other funds in the amount of $25,141,275 representing the loans received from the City’s Intra-governmental loan fund and development tax funds to facilitate the construction and the ongoing operations of the golf course fund. In the 2015 Financial Statements, for financial statement purposes, these loans were reclassified to “Transfers In” recognizing that the repayment of these loans was not expected within a reasonable time. At the same time, the City has not formally forgiven the loans and the advances are now being disclosed as a contingent liability of the golf course funds. The balance of these loans has not accrued any interest in the current fiscal year and is $27.6 million at June 30, 2025 (of which $15.6 million is principal and $12 million is previously accrued and unpaid interest). Should sufficient resources in the golf courses become available to make repayments in the future, those repayments of this contingent liability will take place; and be recorded as transfers out from the golf courses at that time.
18) Excess of Expenditures over Appropriations and Negative Net Position A. Budgetary Compliance
Expenditures exceeded appropriations in the Neighborhood Stabilization Program, Special Programs, and Pension Obligation Bonds Nonmajor Governmental Funds. The excess expenditures were funded by available fund balance.

In the General Fund, total expenditures exceeded appropriations primarily due to departments paying out accrued

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
88 compensated absences as part of year-end adjustments. This one-time item was recorded in non-departmental expenditures.

B. Negative Net Position
Two Internal Service Funds reported negative net position at year-end. The Insurance Internal Service Fund reflected a negative net position of $6,305,682 primarily due to increases in claims and related actuarial liabilities.

The Compensated Absences Internal Service Fund reported a negative net position of $11,958,126 as a result of the City recognizing the full compensated absences liability associated with governmental activities in this fund.

The City anticipates that these deficits will decrease over time as claims activity stabilizes and accrued leave balances are paid out and reduced through new union negotiated contracts. and Negative Fund Balances/Net Position
19) North Bay Treatment Plant
The North Bay Treatment Plant was constructed through a joint exercise of powers agreement between the City and the City of Vacaville to operate and maintain facilities for supplying potable water to their respective service areas. The agreement did not create a separate agency or separate legal entity separate from the parties. A Joint Powers Policy Committee (JPPC) handles the organization and administration of the North Bay Treatment Plant.

The JPPC is composed of the Director of Public Works from the City and the Director of Public Works from Vacaville or their designated alternates. The City is reporting this cost-sharing arrangement as a joint venture with a majority interest, due to the fact the City has operational control of this facility and functions as a majority member. As a result, the City reports the entire operations of the North Bay Treatment Plant as a major enterprise fund in the accompanying financial statements, with a corresponding reserve for minority interests.

At June 30, 2025, the net position between Fairfield and Vacaville is classified as follows:

Net Position Fairfield Vacaville Totals
Net Investment in capital assets $ 20,179,914 $ 11,425,485 $ 31,605,399 Restricted for major maintenance 22,769,942 12,887,411 35,657,353 Restricted for minority interest 282,495 282,495
Unrestricted 766,343 766,343
Totals $ 43,716,199 $ 24,595,391 $ 68,311,590
20) Successor Agency Trust for Assets of Former Redevelopment Agency The purpose of this footnote is to explain the impact of the dissolution of the Fairfield Redevelopment Agency on the City’s financial statements. Under AB 1X 26, passed on June 28, 2011, all redevelopment agencies in the State of California were dissolved and ceased operations as a legal entity as of February 1, 2012.

Amongst numerous requirements, AB 1X 26 requires the following:
i. subject to the control of a newly established oversight board, assets of the former redevelopment agency must be disposed expeditiously, and property tax revenue generated by a former redevelopment agency can only be used to pay enforceable obligations (i.e., debt obligations and other third-party contractual obligations);
ii. either the city or another unit of local government may agree to serve as the “Successor Agency” to hold the net position until they are distributed to units of state and local government.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
89 iii. successor agencies may transfer housing functions of the former redevelopment agency to the appropriate entity; and
iv. any property tax revenue in excess of enforceable obligations is to be distributed by county auditor controllers to taxing entities, which includes the City, as surplus property tax. In addition, any land sales of property by the Successor agency must be distributed to Solano County, which in turn, is distributed to the various taxing entities. In all years going forward, successor agencies will only be allocated revenue in the amount that is necessary to pay the estimated annual installment payments on enforceable obligations of the former redevelopment agency until all enforceable obligations of the prior redevelopment agency have been paid in full and all assets of the agency have been liquidated.

As a result of the restrictions placed on the assets and liabilities of the former redevelopment agency, all of these assets and liabilities were transferred (and are accounted for on an ongoing basis) into a fiduciary fund (privatepurpose trust fund) on February 1, 2012. On February 7th, 2012, the City Council elected to become the Successor Agency to the former Fairfield Redevelopment Agency in accordance with AB 1X 26 as part of City resolution number SA2012-01. On May 14, 2012, the Oversight Board to the Successor Agency of the Fairfield Redevelopment Agency agreed to transfer the housing responsibilities and all rights, powers, duties, and obligations associated with the housing activities of the agency to the Fairfield Housing Authority. The transfer of the majority of these housing assets occurred during fiscal year 2012-2013 year after the approval by the State of California Department of Finance.

A. Receivables
At June 30, 2025 receivables consisted of the following:

Total
Receivables Receivables
Interest and other $ 32,250
Loans 925,000
Total Receivables, Net $ 957,250
The loan receivable is for $925,000 represents a loan from Casa Nova Mobile Home Park. Bond proceeds were issued by the former redevelopment agency and originally used to assist Casa Nova Mobile Home Park to purchase the mobile home park (in 1996 and now have been subsequently refinanced), and now the Successor Agency recognizes a loan receivable from Casa Nova equal to the amount of bonds payable that relate to the purchase of the mobile home park. The receivable is reduced as the debt (bonds payable) is paid down by the mobile home park.

B. Land Held for Resale
The total value of Land Held for Resale at June 30, 2025, is $3,554,933 and consists of properties that were acquired by the former Redevelopment Agency for future development. The properties are carried at the lower of cost or fair value. As a result of the Successor Agency having its Property Management Plan approved by the State on February 27, 2014, the Successor Agency will continue to look to sell land for development. When the Successor Agency sells a piece of land, under state law, the proceeds are immediately remitted to Solano County, which in turn distributes the proceeds of sale to the various taxing entities.

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
90 C. Long Term Obligations
The following is a summary of long-term bonds outstanding of the Successor Agency for the year ended June 30, 2025:

Amount Amount Due
Balance Incurred or Satisfied or Balance Due Within More Than 7/1/2024 Issued Matured 6/30/2025 One Year One Year
Tax Allocation Refunding Bonds
Successor Agency 2014 Casa Nova $ 1,130,000 $ 205,000 $ 925,000 $ 215,000 $ 710,000 Successor Agency 2023 North Texas Project Area 5,570,000 400,000 5,170,000 315,000 4,855,000 6,700,000 $ - 605,000 6,095,000 530,000 5,565,000
Bond Premiums/Discounts 58,139 4,025 22,077 40,087 40,087 Total Bonds Payable $ 6,758,139 $ 4,025 $ 627,077 $ 6,135,087 $ 530,000 $ 5,605,087 Long Term Notes Payable
Solano business park H12-3A $ 1,963,121 $ 1,963,121 $ 1,963,121 Kaufman & Broad H12-3A 178,378 178,378 178,378
Total Long Term Notes Payable $ 2,141,499 $ - $ - $ 2,141,499 $ - $ 2,141,499 Total Long Term Debt $ 8,899,638 $ 4,025 $ 627,077 $ 8,276,586 $ 530,000 $ 7,746,586 Amount Amount Due
Balance Incurred or Satisfied or Balance Due Within More Than 7/1/2024 Issued Matured 6/30/2025 One Year One Year
Loans Payable to the City of Fairfield
Regional Center - Loan from HOME Fund $ 109,689 $ 109,689 $ 109,689 Total Loans Payable $ 109,689 $ - $ - $ 109,689 $ - $ 109,689 i. Tax Allocation Refunding Bonds
On April 3, 2014, the Successor Agency issued $29,075,000 in bonds to refinance prior obligations and bonds of the Successor Agency and related obligations of the Fairfield Public Financing Authority (which were for Redevelopment purposes). As of June 30, 2025, the outstanding balance of the refunding issue is $925,000. This debt issue has interest rates ranging from 3.00% - 5.00% and has a final maturity date in 2028. This bond issue neither raised new money nor increased the final maturity date. The revenue bonds are secured by a pledge of, and lien on, monies deposited from time to time in the Redevelopment Property Tax Trust Fund. This bond refinancing was approved by both the California Department of Finance as well as the Successor Agency’s Oversight Board.

This bond issue of $29,075,000 included the refinancing of the previously outstanding 2003, Series B bonds which were previously issued (originally in 1996 and subsequently refinanced in 2003) specifically to assist Casa Nova Mobile Home Park in the purchase of their mobile home park. The amount outstanding that pertains to Casa Nova Mobile Home Park at June 30, 2025 is $925,000. This portion of the bonds is being serviced and paid by Casa Nova Mobile Home Park and the Successor Agency has recorded both a receivable and a liability for this same amount.

As Casa Nova makes a principal payment, the bonds payable and loans receivable are reduced for an equal amount. As Casa Nova Mobile Home Park makes an interest payment, miscellaneous revenue is recorded along with an interest expense.

The Fairfield Redevelopment Agency issued the 2023 Tax Allocation Refunding Bonds in December 2023 in the amount of $5,570,000. The refunding bonds lowered the interest rate from the previous 2011 North Texas Tax Allocation Bond of 3.52% to 8.25% to a range from 5.36% to 5.96%. The refunding also provides additional savings

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
91 to the Successor Agency and additional revenue to the taxing agencies within the former redevelopment areas.

The outstanding balance as of June 30, 2025 is $5,170,000.

The remaining debt service requirements on these refunding tax allocation refunding bonds are as follows:

Fiscal Year
Ending Principal Interest Totals
2026 $ 530,000 $ 326,560 $ 856,560
2027 560,000 298,077 858,077
2028 585,000 268,132 853,132
2029 615,000 236,574 851,574
2030 390,000 209,557 599,557
2031-2035 2,295,000 681,440 2,976,440
2036-2037 1,120,000 67,646 1,187,646
Totals $ 6,095,000 $ 2,087,986 $ 8,182,986
Tax Allocation Refunding Bonds
ii. Long Term Notes Payable
The former Redevelopment Agency has two long-term notes in the Highway 12 Project Area totaling $2,141,499 (which includes accrued interest). These notes are subordinate to other debts of the Successor Agency. In September 1981, the Agency issued a long-term note for $931,081 to reimburse a developer for the cost of oversizing storm drainage facilities in the Highway 12 Project Area. Interest accrued at 10% compounded annually through September 1, 1989, after which the note became non-interest bearing. Total unpaid interest is $1,032,040, which has been added to the note. In February 1982, the Agency issued a non-interest-bearing longterm note to reimburse a developer for the cost of oversizing storm drainage facilities in the Highway 12 Project Area for $178,378. No payments have been made on the loans. The loans will mature once the City of Fairfield loans have been satisfied and matured.
iii. Loans Payable to the City of Fairfield and the Fairfield Housing Authority The City has made prior loans to the former Redevelopment Agency for redevelopment project costs. The loans payable due to the City of Fairfield for monies advanced to the Redevelopment Agency to help purchase a low and moderate housing unit prior to AB 1X 26 implementation. The loan balance as of June 30, 2025 is $109,689. 21) Debt with No City Commitment
Special assessment districts in various parts of the City have issued debt under the 1915 Act and Mello-Roos Special Tax Act of 1982 to finance infrastructure improvements and facilities within their boundaries. Neither the faith and credit nor the taxing power of the City, the State of California, or any political subdivision thereof is pledged to the payment of any debt service for these districts. Payment of the debt is secured by valid assessment liens placed upon certain lands within each district. The City is the collecting and paying agent for the debt issued by these Districts but has no direct or contingent liability or moral obligation for the payment of this debt.

Therefore, this debt is not included in the general long-term debt of the City. This type of debt is accounted for in the custodial funds. In addition, the Fairfield Housing Authority issued debt in 2012 to serve as a conduit to assist a mobile home park in the refinancing of their previously existing bonds. This debt is not a liability of the City, as the mobile home park’s revenue collections are the sole source of payment and security on the bonds; and these revenues have been assigned by the Housing Authority to the trustee for direct payment on the bonds. As neither

City of Fairfield, California
Notes to Basic Financial Statements (continued)
For the Year Ended June 30, 2025
92 the City nor the Housing Authority have any financial liability for this debt, this debt is not included in the general long-term debt of the City.

The outstanding balance of each of these issues as of June 30, 2025, is as follows:

Issue Maturity Balances
Description Date Date June 30, 2025
Communities Facilities District No. 3 - Series 2018 12/5/2018 9/1/2037 9,695,000 $ Communities Facilities District No. 2007-1, Fairfield Commons, Series 2008 4/3/2008 9/1/2038 13,440,000 Communities Facilities District No. 2016-1, Villages at Fairfield- Area A, Series 2018 1/25/2018 9/1/2048 3,555,000 Communities Facilities District No. 2016-1, Villages at Fairfield- Area B, Series 2019A 8/8/2019 9/1/2049 19,455,000 Communities Facilities District No. 2016-1, Villages at Fairfield- Area B, Series 2025A 4/30/2025 9/1/2050 2,860,000 Communities Facilities District No. 2016-1, Villages at Fairfield- Area C, Series 2021A 11/23/2021 9/1/2052 22,615,000 Communities Facilities District No. 2019-1, One Lake, Series 2020A 6/25/2020 9/1/2050 15,100,000 Communities Facilities District No. 2019-1, One Lake, Series 2021A 9/30/2021 9/1/2051 11,700,000 Communities Facilities District No. 2023-1, One Lake Planning Area 5, Series 2024A 12/19/2024 9/1/2054 36,500,000 Fairfield Housing Authority 2012 Revenue Bonds (Creekside Estates) 1/31/2012 9/1/2029 2,795,000 Total Non-Commitment Debt $ 137,715,000
22) Subsequent Event
In fiscal year 2025, the City entered into a contract with Willdan Energy Solutions to implement a comprehensive energy efficiency project. The project includes solar installations, lighting retrofits, HVAC upgrades, and other conservation measures across multiple City facilities. The total contract amount is $29,998,064. The City has secured $8.6M in available funding and issued a request for proposal (RFP) for Tax-Exempt Lease Purchase (TELP) financing for $21,309,756. The City received financing proposals in August 2025 and secured the financing on August 29, 2025 through Banc of America Public Capital Corp. The term of the financing is for 15 years, maturing on August 29, 2040 and has a contract interest rate of 4.012% per annum. The project is expected to generate sufficient long-term energy cost savings to offset the related financing obligations.

City of Fairfield, California
People and Places in the City
93 Page 488 of 968
City of Fairfield, California
Required Supplementary Information
94 Miscellaneous Plan
Schedule of Changes in Net Pension Liability and Related Ratios Last Ten Years 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Total pension liability
Service cost $ 4,265,773 $ 4,261,714 $ 4,792,562 $ 4,953,864 $ 4,959,754 $ 5,042,853 $ 5,221,877 $ 6,037,681 $ 6,099,804 $ 6,724,100 Interest on the total pension liability 19,987,138 20,564,347 21,229,322 22,113,909 23,145,866 24,133,212 25,231,079 26,161,115 27,364,204 28,730,811 Changes in benefits 363,430
Differences between expected and
actual experience (2,954,005) (3,999,107) (901,217) 2,752,187 3,004,523 2,153,819 3,855,652 3,102,260 5,651,758 8,793,003 Changes in assumptions (4,868,664) 17,376,981 (2,020,155) 11,596,275 Benefit payments, including refunds of
employee contributions (12,209,765) (13,203,370) (13,733,897) (15,191,547) (16,093,011) (16,890,914) (18,641,949) (19,948,106) (21,669,850) (23,856,644) Net change in total pension liability 4,220,477 7,623,584 28,763,751 12,608,258 15,017,132 14,438,970 15,666,659 26,949,225 17,809,346 20,391,270 Total pension liability -- beginning 273,064,445 277,284,922 284,908,506 313,672,257 326,280,515 341,297,647 355,736,617 371,403,276 398,352,501 416,161,847 Total pension liability -- ending (a) 277,284,922 284,908,506 313,672,257 326,280,515 341,297,647 355,736,617 371,403,276 398,352,501 416,161,847 436,553,117 Plan fiduciary net position
Contributions - employer 4,147,940 4,923,250 5,608,699 6,305,148 7,460,599 9,054,680 9,903,995 11,177,620 12,605,962 13,391,833 Contributions - employee 2,436,113 2,528,364 2,598,318 2,555,190 2,575,759 2,656,053 2,760,535 3,002,172 3,055,934 3,235,450 Net investment income 4,549,087 958,715 22,563,672 18,437,644 15,156,188 11,749,293 56,111,862 (22,731,303) 16,619,226 26,827,371 Benefit payments, including refunds of
employee contributions (12,209,765) (13,203,370) (13,733,897) (15,191,547) (16,093,011) (16,890,914) (18,641,949) (19,948,106) (21,669,850) (23,856,644) Net Plan to Resource Movement (546)
Other Miscellaneous Income/Expense (659,510) 546
Net change in fiduciary net position (1,076,625) (4,793,041) 17,036,792 11,446,379 9,100,081 6,569,112 50,134,443 (28,499,617) 10,611,272 19,598,010 Plan fiduciary net position -- beginning 211,701,104 210,624,479 205,831,438 222,868,230 234,314,609 243,414,690 249,983,802 300,118,245 271,618,628 282,229,900 Plan fiduciary net position -- ending (b) 210,624,479 205,831,438 222,868,230 234,314,609 243,414,690 249,983,802 300,118,245 271,618,628 282,229,900 301,827,910 Net pension liability -- ending (a) - (b) $ 66,660,443 $ 79,077,068 $ 90,804,027 $ 91,965,906 $ 97,882,957 $ 105,752,815 $ 71,285,031 $ 126,733,873 $ 133,931,947 $ 134,725,207 Plan fiduciary net position as a
percentage of the total pension liability 75.96% 72.24% 71.05% 71.81% 71.32% 70.27% 80.81% 68.19% 67.82% 69.14% Measurement Date 6/30/2015 6/30/2016 6/30/2017 6/30/2018 6/30/2019 6/30/2020 6/30/2021 6/30/2022 6/30/2023 6/30/2024 Covered payroll (from prior year) $ 24,507,487 $ 24,641,309 $ 25,345,225 $ 25,943,558 $ 27,532,843 $ 29,246,526 $ 30,678,521 $ 32,082,394 $ 35,007,610 $ 36,112,245 Net pension liability as a percentage of
covered payroll 272.00% 320.91% 358.27% 354.48% 355.51% 361.59% 232.36% 395.03% 382.58% 373.07% Change of Assumptions Effective with the June 30, 2021 valuation date (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. Projected returns for all asset classes are estimated, combined with risk estimates, and are used to project compound (geometric) returns over the long term.

The discount rate used to discount liabilities was informed by the long-term projected portfolio return. In addition, demographic assumptions and the inflation rate 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 2017 through 2021, 7.65% for measurement dates 2015 through 2016, and 7.50% for measurement date 2014.

City of Fairfield, California
Required Supplementary Information (continued)
95 Safety Plan
Schedule of Changes in Net Pension Liability and Related Ratios Last Ten Years 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Total pension liability
Service cost $ 5,385,012 $ 5,258,222 $ 6,300,021 $ 6,296,742 $ 6,522,394 $ 7,032,195 $ 7,034,201 $ 7,938,938 $ 8,484,567 $ 9,156,911 Interest on the total pension liability 18,224,032 18,921,981 19,573,221 20,572,192 21,922,457 23,007,358 24,001,451 25,238,718 26,753,628 28,327,317 Changes in benefits 129,841
Differences between expected and
actual experience (86,780) (2,588,170) (2,663,481) 2,678,526 6,491,163 1,812,363 (55,466) 265,602 6,617,728 6,728,294 Changes in assumptions (4,628,655) 16,931,340 (1,005,769) 15,399,167 Benefit payments, including refunds of
employee contributions (11,504,270) (12,163,671) (12,963,887) (14,181,595) (14,994,561) (15,682,792) (16,480,599) (17,637,205) (18,848,426) (20,142,692) Net change in total pension liability 7,389,339 9,428,362 27,177,214 14,360,096 19,941,453 16,169,124 14,499,587 31,205,220 23,137,338 24,069,830 Total pension liability -- beginning 245,997,705 253,387,044 262,815,406 289,992,620 304,352,716 324,294,169 340,463,293 354,962,880 386,168,100 409,305,438 Total pension liability -- ending (a) 253,387,044 262,815,406 289,992,620 304,352,716 324,294,169 340,463,293 354,962,880 386,168,100 409,305,438 433,375,268 Plan fiduciary net position
Contributions - employer 5,065,553 5,640,187 6,815,028 7,234,241 18,568,978 12,849,535 14,601,731 11,586,572 12,545,168 13,863,617 Contributions - employee 2,261,518 2,356,563 2,653,300 2,485,341 2,741,655 2,840,794 2,892,822 3,388,779 3,414,326 3,228,869 Net investment income 4,001,161 803,971 20,605,386 16,944,567 14,077,299 11,390,873 56,491,428 (23,391,930) 17,014,586 27,904,259 Benefit payments, including refunds of
employee contributions (11,504,270) (12,163,671) (12,963,887) (14,181,595) (14,994,561) (15,682,792) (16,480,599) (17,637,205) (18,848,426) (20,142,692) Net Plan to Resource Movement (505)
Other Miscellaneous Income/Expense (606,911) 505
Net change in fiduciary net position (176,038) (3,362,950) 17,109,827 11,875,138 20,393,876 11,398,410 57,505,382 (26,053,784) 14,125,654 24,854,053 Plan fiduciary net position -- beginning 191,522,740 191,346,702 187,983,752 205,093,579 216,968,717 237,362,593 248,761,003 306,266,385 280,212,601 294,338,255 Plan fiduciary net position -- ending (b) 191,346,702 187,983,752 205,093,579 216,968,717 237,362,593 248,761,003 306,266,385 280,212,601 294,338,255 319,192,308 Net pension liability -- ending (a) - (b) $ 62,040,342 $ 74,831,654 $ 84,899,041 $ 87,383,999 $ 86,931,576 $ 91,702,290 $ 48,696,495 $ 105,955,499 $ 114,967,183 $ 114,182,960 Plan fiduciary net position as a
percentage of the total pension liability 75.52% 71.53% 70.72% 71.29% 73.19% 73.07% 86.28% 72.56% 71.91% 73.65% Measurement Date 6/30/2015 6/30/2016 6/30/2017 6/30/2018 6/30/2019 6/30/2020 6/30/2021 6/30/2022 6/30/2023 6/30/2024 Covered payroll (from prior year) $ 20,287,881 $ 20,082,583 $ 22,074,441 $ 22,170,095 $ 24,119,130 $ 25,122,688 $ 25,427,060 $ 26,930,315 $ 30,043,092 $ 30,381,258 Net pension liability as a percentage of
covered payroll 305.80% 372.62% 384.60% 394.15% 360.43% 365.02% 191.51% 393.44% 382.67% 375.83% Change of Assumptions Effective with the June 30, 2021 valuation date (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. Projected returns for all asset classes are estimated, combined with risk estimates, and are used to project compound (geometric) returns over the long term.

The discount rate used to discount liabilities was informed by the long-term projected portfolio return. In addition, demographic assumptions and the inflation rate 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 2017 through 2021, 7.65% for measurement dates 2015 through 2016, and 7.50% for measurement date 2014.

City of Fairfield, California
Required Supplementary Information (continued)
96 Schedule of Contributions – Miscellaneous Plan
Last Ten Years
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Actuarially determined contributions $ 4,923,250 $ 5,608,699 $ 6,278,436 $ 7,455,288 $ 9,054,751 $ 9,892,323 $ 11,163,419 $ 12,593,590 $ 13,374,189 $ 14,958,441 Contributions in relation to the actuarially
determined contribution (4,923,250) (5,608,699) (6,278,436) (7,455,288) (9,054,751) (9,892,323) (11,163,419) (12,593,590) (13,374,189) (14,958,441) Contribution deficiency (excess) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Covered payroll (from current year) $ 24,641,309 $ 25,345,225 $ 25,943,558 $ 27,532,843 $ 29,246,526 $ 30,678,521 $ 32,082,394 $ 35,007,610 $ 36,112,245 $ 37,917,857 Contributions as a percentage of covered payroll 19.98% 22.13% 24.20% 27.08% 30.96% 32.25% 34.80% 35.97% 37.04% 39.45% Notes to Schedule
Valuation date: 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 6/30/2022 Methods and assumptions used to determine
contribution rates:

Actuarial cost method Entry Age Normal Cost Method
Amortization method Level Percentage of Payroll
Remaining amortization period 15 Years as of the Valuation Date Asset valuation method Market Value of Assets
Inflation
Salary Increase Varies by entry age and service
Investment Rate of Return 6.80% (net of administration expenses) Retirement age The probabilities of retirement are based on the 2021 CalPERS Experience Study for the period from 2000 to 2019.

Mortality

2.80%
The probabilities of mortality are based on the 2021 CalPERS Experience Study for the period from 2000 to 2019.

Pre-retirement and post-retirement mortality rates incorporate mortality improvement trends with actual recent mortality rates using Scale MP-2020 published by the Society of Actuaries.

City of Fairfield, California
Required Supplementary Information (continued)
97 Schedule of Contributions – Safety Plan
Last Ten Years
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Actuarially determined contributions $ 5,640,187 $ 6,815,028 $ 7,234,241 $ 8,568,977 $ 9,844,064 $ 10,601,731 $ 11,585,568 $ 12,542,766 $ 13,860,490 $ 15,148,097 Contributions in relation to the actuarially
determined contribution (5,640,187) (6,815,028) (7,234,241) (18,568,977) (12,844,064) (14,601,731) (11,585,568) (12,542,766) (13,860,490) (15,148,097) Contribution deficiency (excess) $ - $ - $ (10,000,000) - $ $ (3,000,000) $ (4,000,000) $ - $ - $ - $ - Covered payroll (from current year) $ 20,082,583 $ 22,074,441 $ 22,170,095 $ 24,119,130 $ 25,122,688 $ 25,427,060 $ 26,930,315 $ 30,043,092 $ 30,381,258 $ 31,900,321 Contributions as a percentage of covered payroll 28.08% 30.87% 32.63% 76.99% 51.13% 57.43% 43.02% 41.75% 45.62% 47.49% Notes to Schedule
Valuation date: 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 6/30/2022 Methods and assumptions used to determine
contribution rates:

Actuarial cost method Entry Age Normal Cost Method
Amortization method Level Percentage of Payroll
Remaining amortization period 15 Years as of the Valuation Date Asset valuation method Market Value of Assets
Inflation
Salary Increase Varies by entry age and service
Investment Rate of Return 6.80% (net of administration expenses) Retirement age The probabilities of retirement are based on the 2021 CalPERS Experience Study for the period from 2000 to 2019.

Mortality
** In FY 18/19, FY 19/20 and FY 20/21, the Safety Plan's contribution includes a one-time $10,000,000, $3,000,000 and $4,000,000 payment, respectively, towards the Safety Plan's unfunded liability.

2.80%
The probabilities of mortality are based on the 2021 CalPERS Experience Study for the period from 2000 to 2019.

Pre-retirement and post-retirement mortality rates incorporate mortality improvement trends with actual recent mortality rates using Scale MP-2020 published by the Society of Actuaries.

City of Fairfield, California
Required Supplementary Information (continued)
98 Schedule of Changes in Net OPEB Liability and Related Ratios Last Ten Years*
2018 2019 2020 2021 2022 2023 2024 2025
Total OPEB liability - Beginning $ 3,192,938 $ 3,153,300 $ 2,606,431 $ 2,648,042 $ 2,662,388 $ 2,570,282 $ 2,093,259 $ 1,994,226 Service cost 18,300 18,895
Interest on the OPEB liability 208,731 198,022 161,227 149,013 148,706 143,995 104,552 99,749 Differences between expected and actual
experience (606,345) 88,699 (501,369) 161,491
Changes in assumptions 93,961 132,429 21,424 98,017 (61,904) Benefit payments (266,669) (251,402) (252,045) (244,790) (240,812) (217,666) (203,585) (188,491) Net change in OPEB liability (39,638) (546,869) 41,611 14,346 (92,106) (477,023) (99,033) 10,845 Total OPEB liability -- ending (a) $ 3,153,300 $ 2,606,431 $ 2,648,042 $ 2,662,388 $ 2,570,282 $ 2,093,259 $ 1,994,226 $ 2,005,071 Plan fiduciary net position
Employer Contribution to the Trust $ 500,000 $ 1,000,000 $ 500,000 Employer Contribution - Direct Benefit
Payments $ 266,669 251,402 252,045 244,790 $ 137,500
Net investment income 687 99,467 106,318 448,334 $ (320,520) $ 71,837 $ 153,172 Benefit payments (266,669) (251,402) (252,045) (244,790) (240,812) (217,666) (203,585) (188,491) Administrative expenses (27) (215) (909) (835) (644) (577) (611) Net change in fiduciary net position - 500,660 1,099,252 605,409 344,187 (538,830) (132,325) (35,930) Plan fiduciary net position -- beginning - - 500,660 1,599,912 2,205,321 2,549,508 2,010,678 1,878,353 Plan fiduciary net position -- ending (b) - 500,660 1,599,912 2,205,321 2,549,508 2,010,678 1,878,353 1,842,423 Net OPEB liability -- ending (a) - (b) $ 3,153,300 $ 2,105,771 $ 1,048,130 $ 457,067 $ 20,774 $ 82,581 $ 115,873 $ 162,648 Plan fiduciary net position as a percentage
of the total OPEB liability 0.00% 19.21% 60.42% 82.83% 99.19% 96.05% 94.19% 91.89% Measurement Date 6/30/2017 6/30/2018 6/30/2019 6/30/2020 6/30/2021 6/30/2022 6/30/2023 6/30/2024 Covered-employee payroll (from prior year) $ 396,752 $ 214,999 N/A** N/A** N/A** N/A** N/A** N/A** 794.78% 979.43% N/A** N/A** N/A** N/A** N/A** N/A**
* Fiscal year 2018 was the first year of implementation (GASB 75), therefore, only eight years are shown. ** This is a closed plan with no active members. The plan only covers members who are already retired while the plan was active.

Net OPEB liability as a percentage of coveredemployee payroll

City of Fairfield, California
Required Supplementary Information (continued)
99 Schedule of Contributions - Net OPEB Liability
Last Ten Years*
Schedule of Contributions
2018 2019 2020 2021 2022 2023 2024 2025
Actuarially determined contributions $ 246,546 $ 506,722 $ 281,374 $ 101,350 $ 82,663 $ 67,365 $ 8,636 $ 7,897 Contributions in relation to the actuarially determined contribution (751,402) (1,252,045) (744,790) (137,500) (217,666) (7,897) Contribution deficiency (excess) $ (504,856) $ (745,323) $ (463,416) $ (36,150) $ (135,003) $ 67,365 $ 8,636 $ - Covered-employee payroll (from current year) $ 214,999 N/A ** N/A ** N/A ** N/A ** N/A ** N/A ** N/A ** Contributions as a percentage of covered-employee
payroll 349.49% N/A ** N/A ** N/A ** N/A ** N/A ** N/A ** N/A ** Notes to Schedule
Valuation date: 6/30/2016 6/30/2018 6/30/2018 6/30/2020 6/30/2020 6/30/2022 6/30/2022 6/30/2024 Methods and assumptions used to determine contribution rates:

Actuarial cost method Entry Age Normal Cost Method
Amortization method/period Level dollar payments; closed 5 year period Asset valuation method Market Value
Inflation 2.50%
Payroll Growth N/A
Healthcare cost-trend rates 6.8% in 2024, step down to 3.9% by 2076 Investment Rate of Return 5.25%
Retirement age N/A; all members are retired
Mortality 2021 CalPERS's Experience Study
* Fiscal year 2018 was the first year of implementation (GASB 75), therefore, only eight years are shown. ** This is a closed plan with no active members. The plan only covers members who are already retired while the plan was active.

City of Fairfield, California
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget and Actual
General Fund
For the Year Ended June 30, 2025
100
Variance with
Budgeted Amounts Final BudgetPositive
Original Final Actual (Negative)
Revenues:

Property taxes $ 42,044,664 $ 44,452,085 $ 46,637,584 $ 2,185,499 Sales taxes 30,890,618 31,007,498 31,739,380 731,882
Transaction and use taxes (Measure P) 25,215,000 24,848,162 24,721,724 (126,438) Utility and franchise taxes 12,300,000 13,044,044 13,218,865 174,821 Other taxes 7,642,492 7,976,744 8,055,816 79,072
Licenses, permits and fines 4,072,783 3,455,939 3,549,162 93,223 Intergovernmental 912,241 977,224 1,340,937 363,713
Charges for services 7,539,207 7,727,177 8,425,429 698,252 Investment income 472,396 472,396 3,483,487 3,011,091
Net increase in fair value of investments 4,000,000 3,000,000 1,263,813 (1,736,187) Miscellaneous 2,180,318 3,192,317 3,492,430 300,113
Total Revenues 137,269,719 140,153,586 145,928,627 5,775,041 Expenditures:

Current:

Administration 6,951,782 7,570,782 6,964,458 606,324
Finance 1,632,664 1,633,255 1,560,077 73,178
Police 60,537,688 60,894,791 59,760,202 1,134,589
Fire 32,998,048 33,890,792 33,641,379 249,413
Public works 19,577,134 19,559,034 19,338,920 220,114
Parks and recreation 8,529,506 8,529,506 7,477,556 1,051,950 Community development 6,268,149 6,383,899 6,021,816 362,083 Non-departmental 3,136,949 3,704,180 8,022,382 (4,318,202) Capital Outlay 272,604 (272,604)
Debt service:

Principal retirement 968,621 (968,621)
Interest 18,278 (18,278)
Total Expenditures 139,631,920 142,166,239 144,046,293 (1,880,054) Excess revenues over expenditures (2,362,201) (2,012,653) 1,882,334 3,894,987 Other Financing Sources (Uses):

Issuance of subscription-based IT arrangements 246,604 246,604 Transfers in 7,305,000 6,855,000 2,655,000 (4,200,000)
Transfers out (4,754,211) (4,842,347) (4,842,347) -
Total other financing sources (uses) 2,550,789 2,012,653 (1,940,743) (3,953,396) Net change in fund balance 188,588 - (58,409) (58,409)
Fund Balance - Beginning of Year 57,318,538 57,318,538 57,318,538 - Fund Balance - End of Year $ 57,507,126 $ 57,318,538 $ 57,260,129 $ (58,409)

City of Fairfield, California
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget and Actual
Low Mod Income Housing Major Special Revenue Fund
For the Year Ended June 30, 2025
101
Variance with
Budgeted Amounts Final BudgetPositive
Original Final Actual (Negative)
Revenues:

Intergovernmental $ 600,000 $ 600,000 $ 668,955 $ 68,955 Investment income 211,551 211,551 367,645 156,094
Net increase in fair value of investments 60,254 60,254 Miscellaneous 636,813 636,813 137,954 (498,859)
Total Revenues 1,448,364 1,448,364 1,234,808 (213,556)
Expenditures:

Current:

Housing services 2,926,614 3,126,614 2,266,679 859,935
Debt Service:

Principal 28,391 (28,391)
Interest 6,472 (6,472)
Total Expenditures 2,926,614 3,126,614 2,301,542 825,072 Excess (deficiency) of revenues
over (under) expenditures (1,478,250) (1,678,250) (1,066,734) 611,516 Other Financing Sources (Uses):

Transfers in 45,000 45,000 45,000 -
Transfers out (896,638) (896,638) (629,799) 266,839
Total other financing sources (uses) (851,638) (851,638) (584,799) 266,839 Net change in fund balances (2,329,888) (2,529,888) (1,651,533) 878,355 Fund Balance - Beginning of Year 37,755,217 37,755,217 37,755,217 - Fund Balance - End of Year $ 35,425,329 $ 35,225,329 $ 36,103,684 $ 878,355

City of Fairfield, California
Supplementary Information
102 Page 497 of 968
City of Fairfield, California
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget and Actual
City Capital Projects – Major Fund
For the Year Ended June 30, 2025
103
Capital
Variance with
Final BudgetFinal Positive
Budget Actual (Negative)
Revenues:

Development fees $ 14,419,701 $ 4,152,861 $ (10,266,840) Intergovernmental 11,993,501 11,993,501
Investment income 361,500 2,332,588 1,971,088
Net increase in fair value of investments 895,621 895,621 Miscellaneous 343,622 343,622
Total Revenues 14,781,201 19,718,193 4,936,992
Expenditures:

Capital outlay 139,540,335 30,129,551 109,410,784
Excess (deficiency) revenues
over (under) expenditures (124,759,134) (10,411,358) 114,347,776 Other Financing Sources (Uses):

Transfers in 19,664,102 8,522,840 (11,141,262)
Transfers out (84,607) (84,607)
Total other financing sources (uses) 19,579,495 8,438,233 (11,141,262) Net change in fund balance (105,179,639) (1,973,125) 103,206,514 Fund Balance - Beginning of Year 59,099,285 59,099,285
Fund Balance - End of Year $ (46,080,354) $ 57,126,160 $ 103,206,514 Projects Budget Actual