TABLE OF CONTENTS
INTRODUCTORY SECTION PAGE
Controller's Transmittal Letter ..................................................................................................... I City Operating Fund Structure ..................................................................................................... IX City Organizational Chart ........................................................................................................... X Directory of City Officials .............................................................................................................. XI Certificate of Achievement - Government Finance Officers Association ................................... XIII
FINANCIAL SECTION
Independent Auditor's Report ..................................................................................................... 1 Management's Discussion and Analysis (Unaudited) ................................................................. 5 Basic Financial Statements
Government-Wide Financial Statements:
Statement of Net Position ..................................................................................................... 29 Statement of Activities ............................................................................................................ 30 Fund Financial Statements:
Balance Sheet - Governmental Funds ..................................................................................... 33 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position ............................................................................................................................. 34 Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds ................................................................................................................................. 35 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities ................................. 36 Proprietary Fund Financial Statements:
Statement of Net Position .................................................................................................... 37 Statement of Revenues, Expenses and Changes in Fund Net Position ................................ 41 Statement of Cash Flows ......................................................................................................... 43 Fiduciary Fund Financial Statements:
Statement of Fiduciary Net Position - Fiduciary Funds - Trust and Custodial Funds ........... 47 Statement of Changes in Fiduciary Net Position - Fiduciary Funds - Trust Funds ................ 48 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
TABLE OF CONTENTS
Notes to the Financial Statements: PAGE
Note 1 Summary of Significant Accounting Policies .............................................................. 50 Note 2 Cash and Investments .................................................................................................. 72 Note 3 Property Taxes ............................................................................................................. 88 Note 4 Receivables .................................................................................................................. 89 Note 5 Property, Plant and Equipment - Capital Assets ....................................................... 92 Notes 6 Leases ......................................................................................................................... 98 Note 7 Long-Term Liabilities .................................................................................................... 101 Note 8 Interfund Activity ......................................................................................................... 121 Note 9 Defeasances ................................................................................................................. 129 Note 10 Risk Management Fund ............................................................................................. 130 Note 11 Employee Benefit Programs ....................................................................................... 132 Note 12 No-Commitment Debt ................................................................................................ 154 Note 13 Commitments and Contingencies ............................................................................. 155 Note 14 Securities Lending ...................................................................................................... 162 Note 15 Other Information ...................................................................................................... 163 Note 16 Deficit Fund Equity ..................................................................................................... 166 Note 17 Subsequent Events ..................................................................................................... 167
REQUIRED SUPPLEMENTARY INFORMATION
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis):
General Fund ..................................................................................................................... 171 Grants Special Revenue Fund ........................................................................................... 173 Notes to the Required Supplementary Information ............................................................. 175 Schedule of Investment Returns - Employees, Fire and Police Retirement Systems ......... 178 Schedule of Changes in Net Pension Liability (Asset) and Related Ratios:
Fire and Police Retirement Systems ................................................................................ 179 Employees Retirement Systems .................................................................................... 181 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
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REQUIRED SUPPLEMENTARY INFORMATION (continued) PAGE
Schedule of Employer Contributions - Pension Trust Funds:
Fire and Police Retirement Systems ................................................................................ 183 Employees Retirement Systems .................................................................................... 183 Schedule of Changes in Net OPEB Liability and Related Ratios 184
OTHER SUPPLEMENTARY INFORMATION
Combining and Individual Fund Financial Statements and Schedules:
Nonmajor Governmental Funds:
Combining Balance Sheet - Nonmajor Governmental Funds ............................................... 187 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds ..................................................................................... 189 Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis)
High Speed Rail - Special Revenue Fund ...................................................................... 191 Special Gas Tax - Special Revenue Fund ....................................................................... 192 Measure C - Special Revenue Fund ............................................................................... 193 Measure P - Special Revenue Fund .............................................................................. 194 Community Services - Special Revenue Fund .............................................................. 195 UGM Impact Fees - Special Revenue Fund ................................................................... 196 Low and Moderate Income Housing - Special Revenue Fund .................................... 197 Special Assessments - Special Revenue Fund .............................................................. 198 City Combined - Capital Projects Fund ......................................................................... 199 Nonmajor Enterprise Funds:
Combining Statement of Net Position .............................................................................................. 201 Combining Statement of Revenues, Expenses and Changes in Fund Net Position ........................ 202 Combining Statement of Cash Flows ................................................................................................. 203 Internal Service Funds:
Combining Statement of Net Position ............................................................................................... 205 Combining Statement of Revenues, Expenses and Changes in Fund Net Position ........................ 207 Combining Statement of Cash Flows ................................................................................................. 208 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
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OTHER SUPPLEMENTARY INFORMATION (continued) PAGE
Fiduciary Funds:
Combining Statement of Fiduciary Net Position - Fiduciary Funds - Pension Trust Funds .............. 210 Combining Statement of Changes in Fiduciary Net Position - Fiduciary Funds - Pension Trust Funds .............................................................................................................................................. 211 Combining Statement of Changes in Assets and Liabilities - Custodial Funds ................................. 212
STATISTICAL SECTION
Net Position by Component - Last Ten Fiscal Years ................................................................ 215 Change in Net Position - Last Ten Fiscal Years ......................................................................... 216 Fund Balances, Governmental Funds - Last Ten Fiscal Years .................................................. 218 Changes in Fund Balances, Governmental Funds - Last Ten Fiscal Years ............................... 219 Gross Assessed Value and Estimated Actual Value of Taxable Property - Last Ten Fiscal Years .................................................................................................................... 220 Direct and Overlapping Property Tax Rates - Last Ten Fiscal Years ....................................... 221 Principal Property Taxpayers - Current Year and Nine Years Ago .......................................... 222 Property Tax Levies and Collections - Last Ten Fiscal Years ................................................... 223 Ratios of Outstanding Debt by Type - Last Ten Fiscal Years ................................................... 224 Ratios of General Bonded Debt Outstanding - Last Ten Fiscal Years ..................................... 226 Direct and Overlapping Governmental Activities Debt - As of January 10, 2022 ................... 227 Debt Coverage Ratio - Airports - Last Ten Fiscal Years ............................................................ 228 Debt Coverage Ratio - Water System - Last Ten Fiscal Years .................................................. 229 Debt Coverage Ratio - Sewer System - Last Ten Fiscal Years ................................................. 230 Pledged Revenue Coverage - Last Ten Fiscal Years ................................................................. 231 Legal Debt Margin Information - Last Ten Fiscal Years ........................................................... 232 Demographic and Economic Statistics - Last Ten Calendar Years .......................................... 233 Principal Employers - Current Year and Nine Years Ago ......................................................... 234 Full Time Equivalent City Government Employees by Function/Program - Last Ten Fiscal Years .................................................................................................................... 235 Operating Indicators by Function/Program - Last Ten Fiscal Years ........................................ 236 Capital Asset Statistics by Function/Program - Last Ten Fiscal Years ..................................... 238 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
Jerry Dyer Georgeanne A. White
Mayor City Manager
2600 Fresno Street, Suite 2156 - Fresno, California 93721-3622 January 21, 2022
The Honorable Mayor Jerry Dyer and Members of the City Council Distinguished Citizens of the City of Fresno
We are pleased to present the Annual Comprehensive Financial Report (ACFR) of the City of Fresno, California (City) for the fiscal year ended June 30, 2022 (fiscal year 2021-2022), with the Independent Auditor’s Report, submitted in compliance with City Charter Section 804(c) and Section 1216. The ACFR has been prepared by the Finance Department in conformance with the principles and standards for financial reporting set forth by the Governmental Accounting Standards Board (GASB).
Responsibility for both the accuracy of the data, as well as the completeness and fairness of the presentation, including all disclosures, rests with the City. The existing comprehensive structure of internal accounting controls in the City provides reasonable assurance that the financial statements are free of any material misstatements. Since the cost of internal control should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements.
The City recognizes that even sound internal controls have inherent limitations. We believe that the City's internal controls adequately safeguard assets, that the reported data is accurate in all material respects, and that its presentation fairly depicts the City’s financial position and changes in its financial position as measured by the financial activity of its various funds. We are confident that the included disclosures provide the reader with an understanding of the City’s financial affairs.
Accounting principles generally accepted in the United States (GAAP) require that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The MD&A can be found immediately following the report of the independent auditors, beginning on page 5.
General Background
The City of Fresno is located near the geographical center of California, approximately 200 miles north of Los Angeles and 170 miles south of the State capital, Sacramento. The City has land area of 115.2 square miles. With over half a million residents (543,660 as of January 1, 2022), Fresno is the 5th largest city in California by population, and 35th largest in the nation. The City is part of the Fresno- Clovis metropolitan area, which is the second largest metropolitan area in the Central Valley after Sacramento.
I LETTER OF TRANSMITTAL With its close proximity to Yosemite National Park (60 miles), Fresno also serves as gateway to Sequoia National Park (75 miles), Sierra National Forest (40 miles) and Kings Canyon National Park (75 miles).
Named for the abundant ash trees lining the San Joaquin River, Fresno was founded in 1872 as a railway station of the Central Pacific Railroad before it was incorporated in 1885.
Population Growth
(in thousands)
20122013201420152016201720182019202020212022
0 100
200
300
400
500
600
Government and Budget
The City operates under the strong-Mayor form of government. Under this form of government, the Mayor serves as the City’s Chief Executive Officer, appointing and overseeing the City Manager, recommending legislation, and presenting the annual budget to the City Council (Council).
The budget of the City of Fresno, within the meaning and context of Section 1205 of the City’s Charter, must be adopted by Council resolution no later than June 30th of a given year. As provided by Section 1206 of the Charter, any adjustments in the amounts appropriated for the purposes indicated at the department/fund level shall be made only upon a motion to amend the resolution adopted by the affirmative votes of at least five Council members. Administrative changes within the department/fund level may be made without approval of Council within written guidelines established by the City Manager.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
II LETTER OF TRANSMITTAL Industry and Economy
Fresno is the economic hub of Fresno County and the San Joaquin Valley, with much of the surrounding areas in the Metropolitan region predominantly tied to large-scale agricultural production. While agriculture still makes up a large component of the region's employment base (11% of jobs), the Fresno economy continues to diversify, as evidenced by the fact that services (30% of jobs) and government (17% of jobs) employ more people than agriculture. 2010 vs. 2022 Estimated Number of Workers by Industry 2010
Agriculture14%
Leisure &
Hospitality8%
Government20%
Finance, Insurance & Real Estate4%
Retail 10%
Wholesale4%
Services
24%
Mining &
Construction5%
Manufacturing8%
Transportation & Public Utilities3%
2022
Agriculture11%
Leisure & Hospitality
9%
Government17%
Finance, Insurance & Real Estate3%
Retail 9%
Wholesale4%
Services30%
Mining & Construction5%
Manufacturing
6%Transportation & Public Utilities
5%
Source: CA Employment Development Department
Distribution is playing a growing role in the City's economy, as evidenced by the Old Navy Pacific Distribution Center, the Ulta Beauty Fulfillment Center, and the Amazon Fulfillment Center. Public sector and healthcare employment are also major contributors to the City’s economy.
Principal Employers (Public & Private Sector)
Employer Employees
Fresno Unified School District 13,669
Community Medical Centers 9,000
County of Fresno 8,870
Amazon 6,500
Clovis Unified School District 6,400
City of Fresno 4,605
Internal Revenue Service 4,230
Foster Farms 3,063
Valley Children's 3,000
Saint Agnes Medical Center 2,900
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
III LETTER OF TRANSMITTAL Economic Overview
Agriculture remains one of the backbones of the Fresno area's economy and continues to be robust.
Fresno County’s agricultural strength rests in its diversity with more than 400 commercial crops providing gross production of $8.08 billion in 2021, an increase of 1.47% from 2020.
Almonds continue to be the lead on Fresno County's Top Ten crop ranking with $1.4 billion gross value in 2021, followed by grapes at $1.35 billion.
California produces most of the grapes grown in the United States with 99.5% of raisins coming from Fresno County. Additionally, the region is a significant exporter to many countries throughout the world. In 2021, Fresno County exported 89 unique agricultural commodities to 96 countries around the world.
2022 Diversified Agricultural Base
Almonds
18%
Grapes
17%
Pistachios
9%
Poultry
7%
Milk
6%
Cattle
5%
Garlic
4%Tomatoes
5%
Oranges
3%
Peaches
3%
Other Crops
24%
Source: Fresno County Agriculture Department
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
IV LETTER OF TRANSMITTAL Fiscal Year 2022 Economic Conditions & Financial Impact The Fresno economy continued to steadily progress during fiscal year 2022 while continuing to recover from the effects of the COVID-19 pandemic , as is shown in the table below:
Economic Indicator 2021 2022 Change (%)
Assessed Value $40,869,953,930 $42,380,247,793 3.7 %
Taxable Sales $17,279,862,069 $26,603,310,345 54.0 %
Unemployment Rate 12.13% 5.60% -53.84 %
Building Permits 10,432 12,359 18.5 %
Local economic improvements were similarly on display when considering key City of Fresno finance indicators as summarized below:
• Total Assets increased $868.0 million (21.7%) from the fiscal year 2021 year-end Total Assets balance of $4,001.0 million.
• Revenues increased $222.2 million (23.9%) from Revenues for fiscal year 2021, which totaled $930.5 million.
• Expenses declined $16.1 million ((1.7)%) to $927.5 million. • Total Net Position increased $218.0 million (8.4%) from fiscal year 2021's total of $2,604.7 million.
Summarized below are key metrics reflecting changes within the City's General Fund:
• Total Assets increased $8.7 million ( 5.3%) over the fiscal year 2021 Total Assets year-end balance of $163.0 million. Growth in Unrestricted Cash of $6.9 million was the primary driver behind the overall growth in Total Assets.
• Total Liabilities increased $5.8 million ( 15.3%) from the fiscal year 2021 year-end Total Liabilities of $38.0 million. A $15.0 million increase in Deposits from Others was the primary reason.
• Revenues increased $30.6 million (8.1%) from fiscal year 2021's Revenues of $377.0 million.
Significant growth was seen in the economy-driven revenues, such as Sales Tax. • Expenditures decreased $-13.7 million ( 3.5%) from fiscal year 2021’s $388.1 million Expenditure level. Increases in Public Protection and Capital Outlay expenditures were the primary factors of the overall increase in General Fund Expenditures.
These results and others are discussed in greater detail in the Management’s Discussion & Analysis, which begins on page 5.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
V LETTER OF TRANSMITTAL How Fresno Compares to the 25 Largest California Cities Though improved, the City of Fresno's financial position still lags behind other large cities in California when it comes to assets available for use to support the City’s population. As the table on page VII demonstrates, the difference between population ranking and assets per capita is one of the largest among the 25 largest California cities by population. It is important to note that the City’s assets are augmented by the Net Pension Asset, which no other city in the survey possesses. The lack of assets puts the City of Fresno at a disadvantage when it comes to providing services to its citizens, because there is an inadequate asset base to efficiently address the needs. Thus, it is imperative that fiscal prudence is maintained and the plan to build all assets, especially cash and capital assets, is continued.
Subsequent Events
Summarized below are events that materially affected the City's finances, which occurred after June 30, 2022:
• Moody's upgraded the City's Lease Revenue Bond from A3 to A2, its Pension Obligation Bond rating from Baa1 to A1, and its General Obligation rating from A2 to A1 on December 19, 2022.
All three ratings maintained a Stable outlook.
• Standard and Poor's upgraded the City's General Obligation rating from A+ to AA-, it's Pension Obligation Bond rating from A+ to AA-, and its Lease Revenue Bond from A to A+ on November 14, 2022. All three ratings maintained a Stable Outlook. • The Fresno Yosemite International Airport expects to receive $70 million from the issuance of proposed Bonds to support design and construction of expansion projects.
All of these subsequent events are discussed in detail in Note 17, which begins on page 167.
Certificate of Achievement
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City for its ACFR for the fiscal year ended June 30, 2021 . This was the 29th consecutive year that the City has achieved this prestigious national award. The Certificate of Achievement is the highest form of recognition in the area of governmental accounting and financial reporting. In order to be awarded a Certificate of Achievement, the City must publish an easily readable and efficiently organized ACFR whose contents conform to program standards. The ACFR must satisfy both Generally Accepted Accounting Principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of only one year. We believe that our current annual comprehensive financial report continues to meet the Certificate of Achievement Program’s requirements, and are submitting it to the GFOA to determine its eligibility for another certificate.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
VI LETTER OF TRANSMITTAL Total Government-Wide Assets per Capita
Top 25 California Cities Comparison
City Total Assets ACFR
Year
Population
California Department of
Finance
As of January 1, 2020
Assets per
Capita
Population
Ranking
Per Capita
Asset Rank
Net Pension
Asset/(Liability)
Los Angeles $ 87,447,834 2022 3,819,538 $ 23 1 3 $ (4,363,649) San Diego $ 17,528,167 2022 1,374,790 $ 13 2 9 $ (2,164,171) San Jose $ 11,157,765 2022 976,482 $ 11 3 10 $ (2,342,879) San Francisco $ 51,616,481 2022 804,534 $ 64 4 1 $ (341,625) Fresno $ 4,869,028 2022 543,660 $ 9 5 15 $ 805,653,000** Sacramento $ 5,432,589 2021 518,037 $ 10 6 12 $ (936,885) Long Beach $ 11,142,130 2021 460,682 $ 24 7 2 $ (527,875) Oakland $ 4,340,474 2022 424,464 $ 10 8 13 $ (1,215,883) Bakersfield $ 2,943,909 2021 408,865 $ 7 9 20 $ (461,427) Anaheim $ 5,423,174 2022 341,245 $ 16 10 5 $ (510,106) Stockton $ 2,847,899 2022 322,489 $ 9 11 17 $ (321,906,746) Riverside $ 4,873,976 2022 317,847 $ 15 12 8 $ 140,293 Irvine* $ 3,280,729 2022 310,250 $ 11 13 11 $ (36,051)
Santa Ana $ 1,944,849 2022 308,459 $ 6 14 24 $ (498,810) Chula Vista $ 2,471,990 2022 276,785 $ 9 15 16 $ 160,774 Fremont* $ 1,532,408 2022 229,476 $ 7 16 22 $ (272,253) Santa Clarita $ 1,722,317 2022 228,835 $ 8 17 18 $ 433 San Bernardino $ 1,112,174 2021 220,840 $ 5 18 25 $ (473,070) Modesto $ 2,071,052 2022 217,880 $ 10 19 14 $ (249,804) Fontana $ 1,418,927 2021 212,809 $ 7 20 23 $ (177,214) Moreno Valley $ 1,411,693 2022 209,407 $ 7 21 21 $ (54,897) Oxnard $ 3,124,356 2022 200,050 $ 16 22 6 $ (191,104) Huntington Beach $ 1,418,959 2022 196,100 $ 7 23 19 $ (15,152) Glendale $ 2,811,745 2022 193,116 $ 15 24 7 $ (388,816) Ontario $ 2,881,638 2022 179,516 $ 16 25 4 $ 150,461
* These cities have Governmental Activities only.
** This figure represents the prefunded Net Pension Asset/overfunding applicable to future years. For peer cities, it represents the underfunding of pension liabilities.
Note: Only figures for each Primary Government were used as of June 30, 2022 AFCRs (2021 when 2022 not available). In cases where Component Units were reflected in separate Columns, Component Unit numbers were excluded.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
VII LETTER OF TRANSMITTAL Acknowledgments
The preparation and completion of the City of Fresno ACFR requires tremendous commitment and would not be possible without the dedication and professionalism of the City's Finance Department staff. This year presented extraordinary challenges for the team, yet they remained steadfast in their resolve to prepare and complete the report.
Additionally, staff throughout each department in the City provide significant supporting working with the Finance team to complete the report. Their invaluable contributions made the preparation of this report possible. Sincere appreciation goes out to the staff in all City departments for their cooperative efforts in responding to the many questions and requests for detailed information that accompanies each annual audit.
Lastly, thank you to the team at The Pun Group for their professional support in the preparation of the ACFR. And thank you to the Mayor, the City Council members, and the members of the City Manager's Office for their continued leadership and support in planning and conducting the City's financial operations.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
VIII LETTER OF TRANSMITTAL CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
IX CITY OPERATING FUND STRUCTURE CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
X CITY ORGANIZATIONAL CHART
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
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XII
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
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XIV
1 2
3 4
MANAGEMENT’S DISCUSSION AND ANALYSIS
(Unaudited)
For the Fiscal Year Ended June 30, 2022
CITY OF FRESNO, CALIFORNIA
This section of the City of Fresno’s (City) Annual Comprehensive Financial Report (ACFR) presents a narrative overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2022. The reader is encouraged to consider the information presented here in conjunction with the City’s financial statements, which follow this section, and the additional information that is furnished in the letter of transmittal at the front of this report. This discussion and analysis provides comparisons primarily for the previous two years; but, may include more extensive comparisons in some instances.
FINANCIAL HIGHLIGHTS
• The assets of the City stayed over $4 billion, reaching a total of $4,869.0 million. • The City had record revenue of $1,152.8 million , primarily due to increases in the following areas: Sales Tax Revenue by $67.6 million (54%), Public Protection by $72.2 million (302.1%), and Community Development by $31.0 million (152.4%).
• The City continues to record a Net Pension Asset. For fiscal year 2022, the Net Pension Asset was $805.7 million. The City of Fresno remains one of very few government entities in the country with a Net Pension Asset.
OVERVIEW OF FISCAL YEAR 2022 FINANCIAL STATEMENTS
The Management's Discussion and Analysis is intended to 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 Financial Statements . This report also contains other Supplementary Information in addition to the basic financial statements.
Government-Wide Financial Statements are designed to provide both long-term and short-term information about the City’s overall financial status in a manner similar to a private-sector business. • The Statement of Net Position presents information on all assets/deferred outflows of resources and liabilities/deferred inflows of resources. The difference between them is reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the City’s financial position is improving or deteriorating. • The Statement of Activities shows how the net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will result in cash flows in future periods. Examples include revenues pertaining to uncollected taxes and fees and expenses pertaining to earned but unused vacation and sick leave.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 5 MANAGEMENT'S DISCUSSION & ANALYSIS Both of the Government-Wide Financial Statements distinguish functions of the City that are principally supported by taxes and inter-governmental revenues (Governmental Activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (Business-Type Activities). The Governmental Activities of the City include general government, public protection, public ways and facilities, culture and recreation, and community development. The Business-Type Activities of the City include two airports, public transportation system, water, sewer, solid waste, community sanitation, convention center, stadium, and theatre.
The Government-Wide Financial Statements include not only the City (known as the primary government), but also legally separate component units including the Fresno Joint Powers Financing Authority, City of Fresno Fire and Police Retirement System, City of Fresno Employees Retirement System, City of Fresno Employees Healthcare Plan, Fresno Revitalization Corporation, and FRC Canyon Crest, LLC. The component units have been “blended” into the City’s financial statements because the governing board (although legally separate from the City) is substantially the same as the City’s, or they provide services entirely or almost exclusively for the benefit of the City even though they do not provide services directly to the City.
As of February 1, 2012, a Successor Agency was created to replace the Redevelopment Agency of the City of Fresno (RDA). Dissolution law provided that the Successor Agency would pay all “enforceable obligations” of the former RDA. The Successor Agency is considered a separate legal entity under Assembly Bill (AB) 1484 for financial presentation purposes. Effective June 30, 2012, the Successor Agency was reported as a Private-Purpose Trust Fund. This means that the Successor Agency’s assets are considered to be held in a trustee or agency capacity for others and therefore cannot be used to support the City’s own programs.
The Government-Wide Financial Statements can be found on pages 29-30 of this report.
Fund Financial Statements focus on individual parts of the City government, reporting the City’s operations in more detail than the Government-Wide Financial Statements. They are used to maintain control over resources that have been segregated for specific activities or objectives and to ensure compliance with finance-related legal requirements. They can be divided into three categories:
• Governmental Funds are used to account for essentially the same functions reported as Governmental Activities in the Government-Wide Financial Statements (i.e., most of the City’s basic services are reported in Governmental Funds). These statements, however, focus on (1) how cash and other financial assets can be readily converted to available resources, and (2) the balances left at year-end that are available for spending. Such information may be useful in determining what financial resources are available in the near future to finance the City’s programs.
Because the focus of Governmental Funds Financial Statements is narrower than that of the Government-Wide Financial Statements, it is helpful to compare the information presented for Governmental Funds with similar information presented for governmental activities in the Government-Wide Financial Statements. By doing so, readers may better understand the long- term impact of the government’s near-term financing decisions. Both the Governmental Funds CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 6 MANAGEMENT DISCUSSION & ANALYSIS Balance Sheet and Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances provide a reconciliation to facilitate this comparison between Governmental Funds and Governmental Activities. These reconciliations may be found on pages 34 and 36.
The City maintains several individual Governmental Funds organized according to their type:
general fund, special revenue, debt service, and capital projects. Information is presented separately in the Governmental Funds Balance Sheet and in the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances for the General Fund and Grants Special Revenue Fund (which are considered to be major funds). Data from the remaining Governmental Funds are combined into a single, aggregated presentation. Individual fund data for each of the Non major Governmental Funds is provided in the form of combining statements elsewhere in this report.
The City adopts an annual appropriated budget. The City’s budget reflects its priorities and tells the taxpayers/ratepayers what is being done with their money. Budgetary comparison schedules for the General Fund and the Grants Special Revenue Fund demonstrate compliance with the budget, and also reflect where actual results deviated from expected budgetary estimates. • Proprietary Funds are generally used to account for services for which the City charges customers (either outside customers, or internal units or departments of the City). Proprietary Funds provide the same type of information as shown in the Government-Wide Financial Statements: albeit in more detail. Proprietary Funds (Enterprise and Internal Service) utilize the same method used by the private sector businesses: the accrual basis of accounting. The City maintains the following two types of Proprietary Funds:
† Enterprise Fund s are used to report the same functions as Business-Type Activities in the Government-Wide Financial Statements. The City uses Enterprise Funds to account for the operations of the Public Utilities [ Water System, Sewer System, Solid Waste Management ], Fresno Area Express [ Transit], Fresno International Airport (FYI) and the Fresno Chandler Downtown Airport (FCH) [Airports], Fresno Convention Center, and Chukchansi Park Stadium [Stadium], all of which are considered to be major funds of the City. Community Sanitation and Parks and Recreation are considered to be Non major Enterprise Funds of the City. In July 2022, Parks and Recreation finalized the acquisition of the Tower Theatre. † Internal Service Funds are used to report activities that provide supplies and services for certain City programs and activities. The City uses Internal Service Funds to account for its fleet of vehicles, management information systems, property maintenance, and electronics/ communication support ( General Services ); self-insurance ( Risk Management ); billing, collecting, and servicing activities for the Water, Sewer, Solid Waste and Community Sanitation Funds ( Billing and Collection ); and healthcare plans ( Employees Healthcare Plan , Retirees Healthcare Plan , Blue Collar Employees Healthcare Plan ). Because Risk Management, General Services and the healthcare plans predominantly benefit Governmental rather than Business-Type functions, they have been included within Governmental Activities in the Government-Wide Financial Statements, whereas Billing and Collection is included in the CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 7 MANAGEMENT DISCUSSION & ANALYSIS Business-Type Activities in the Government-Wide Financial Statements. The Internal Service Funds are combined into a single, aggregated presentation in the Proprietary Fund Financial Statements. Individual Fund data for the Internal Service Funds is provided in the form of combining statements.
• Fiduciary Funds are used to account for resources held for the benefit of parties outside the City.
Since the resources of Fiduciary Funds are not available to support the City’s own programs, they are not reflected in the Government-Wide Financial Statements. The accounting used for Fiduciary Funds is much like that used for Proprietary Funds. The City maintains three types of Fiduciary Funds:
† Pension Trust Funds consist of funds for Fire and Police and other Employees. † Private-Purpose Trust Fund is used to account for the assets and liabilities held in trust for the Successor Agency to the former RDA.
† Custodial Funds consist of funds used to account for City-related trust activity, such as payroll withholding and bid deposits. Custodial Funds also include Special Assessment Funds that account for debt service transactions involving special assessment districts within the City.
The basic financial statements can be found on pages 29-168 of this report.
Notes to the Financial Statements
The Notes to the Financial Statements provide additional information that is essential to the full understanding of the data provided in all of the financial statements. The Notes to the Financial Statements can be found on pages 50-168 of this report.
Required Supplementary Information (RSI)
In addition to the basic financial statements and accompanying notes, this report presents certain required supplementary information including budgetary comparison statements for major governmental funds as well as schedules of investment returns, changes in Net Pension Liability (Asset), employer contribution, and schedule of changes in Net Other Post-Employment Benefits (OPEB) Liability and related ratios. RSI and accompanying notes can be found on pages 171-184 of this report.
Combining and Individual Fund Statements and Schedules
The combining statements referred to earlier in connection with non major governmental funds, non major enterprise funds, internal service funds, fiduciary funds and the Discretely Presented Component Unit are presented immediately following the appropriately labeled tabs. Combining and individual fund statements and schedules can be found on pages 187-213 of this report.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 8 MANAGEMENT DISCUSSION & ANALYSIS
GOVERNMENT-WIDE FINANCIAL ANALYSIS
The City presents its financial statements under the reporting model required by the Governmental Accounting Standards Board Statement No. 34 (GASB 34), Basic Financial Statements - and Management’s Discussion and Analysis (MD&A) - for State and Local Governments.
Net Position - Government-Wide / Primary Government
(in thousands)
Governmental
Activities
Business-Type
Activities Total Total Change from
Prior Year
2021 2022 2021 2022 2021 2022 $ %
Assets:
Current and Other Assets $ 636,312 $ 691,619 $ 568,880 $ 640,479 $ 1,205,192 $ 1,332,098 $ 126,906 10.5% Net Pension Asset 78,323 644,438 14,875 161,215 93,198 805,653 712,455 764.5% Capital Assets:
Not Being Depreciated 334,143 356,254 481,193 315,804 815,336 672,058 (143,278) (17.6)% Net of Accumulated Depreciation 607,929 650,249 1,279,354 1,408,970 1,887,283 2,059,219 171,936 9.1% Total Capital Assets 942,072 1,006,503 1,760,547 1,724,774 2,702,619 2,731,277 28,658 1.1% Total Assets 1,656,707 2,342,560 2,344,302 2,526,468 4,001,009 4,869,028 868,019 21.7% Deferred Outflows of Resources:
Charge on Refunding 3,550 3,169 178 138 3,728 3,307 (421) (11.3)% Deferred Outflows - Pension 176,324 65,621 43,667 14,115 219,991 79,736 (140,255) (63.8)% Deferred Outflows - OPEB 26,069 22,208 10,917 9,338 36,986 31,546 (5,440) (14.7)% Total Deferred Outflows of Resources 205,943 90,998 54,762 23,591 260,705 114,589 (146,116) (56.0)% Liabilities:
Long-Term Liabilities Due Within One Year 86,619 82,890 21,459 24,902 108,078 107,792 (286) (0.3)% Long-Term Liabilities Due in More than One
Year 553,188 551,257 690,944 662,670 1,244,132 1,213,927 (30,205) (2.4)% Other Liabilities 166,233 164,384 96,945 102,174 263,178 266,558 3,380 1.3% Total Liabilities 806,040 798,531 809,348 789,746 1,615,388 1,588,277 (27,111) (1.7)% Deferred Inflows of Resources:
Pension Revenue Applicable to Future Years 16,075 372,040 534 91,838 16,609 463,878 447,269 2,692.9% Unamortized OPEB Expense 17,662 51,193 7,318 22,487 24,980 73,680 48,700 195.0% Total Deferred Inflows of Resources 33,737 423,623 7,852 114,325 41,589 537,948 496,359 1,193.5% Net Position:
Net Investment in Capital Assets 794,759 836,439 1,120,876 1,094,088 1,915,635 1,930,527 14,892 0.8% Restricted 304,925 316,891 — — 304,925 316,891 11,966 3.9% Unrestricted (76,811) 56,963 460,988 526,841 384,177 583,804 199,627 52.0% Total Net Position $ 1,022,873 $ 1,210,293 $ 1,581,864 $ 1,620,929 $ 2,604,737 $ 2,831,222 $ 226,485 8.7% CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 9 MANAGEMENT DISCUSSION & ANALYSIS Changes in Net Position - Government-Wide / Primary Government (in thousands)
Governmental
Activities
Business-Type
Activities Total Total Change from
Prior Year
2021 2022 2021 2022 2021 2022 $ %
Revenues
Program Revenues:
Charges for Services $ 73,333 $ 159,176 $ 268,161 $ 331,195 $ 341,494 $ 490,371 $ 148,877 43.6% Operating Grants & Contributions 40,393 74,245 56,334 71,273 96,727 145,518 48,791 50.4% Capital Grants & Contributions 135,064 128,553 29,884 17,893 164,948 146,446 (18,502) (11.2)% General Revenues:
Property Taxes 149,822 154,130 — — 149,822 154,130 4,308 2.9% Business Tax 20,577 21,764 — — 20,577 21,764 1,187 5.8% Sales Taxes - Shared Revenues 125,279 192,874 — — 125,279 192,874 67,595 54.0% Other Local Taxes 32,120 37,004 — — 32,120 37,004 4,884 15.2% Investment Earnings 1,786 (10,409) (2,206) (24,697) (420) (35,106) (34,686) 8,258.6% Other Financing Sources-Leases — — — (224) — (224) (224) Total Revenues 578,374 757,337 352,173 395,440 1,420,918 1,152,777 (268,141) (18.9)% Expenses
General Government 90,218 90,035 — — 90,218 90,035 (183) (0.2)% Public Protection 305,172 270,465 — — 305,172 270,465 (34,707) (11.4)% Public Ways and Facilities 123,068 101,306 — — 123,068 101,306 (21,762) (17.7)% Culture and Recreation 30,882 30,324 — — 30,882 30,324 (558) (1.8)% Community Development 41,053 57,123 — — 41,053 57,123 16,070 39.1% Interest on Long-Term Debt 12,552 12,683 — — 12,552 12,683 131 1.0% Sewer, Water and Solid Waste — — 216,322 232,765 216,322 232,765 16,443 7.6% Transit — — 66,135 71,038 66,135 71,038 4,903 7.4% Airports — — 41,090 40,413 41,090 40,413 (677) (1.6)% Fresno Convention Center — — 5,096 9,235 5,096 9,235 4,139 81.2% Community Sanitation — — 8,698 8,743 8,698 8,743 45 0.5% Parks and Recreation — — 572 416 572 416 (156) (27.3)% Stadium — — 2,739 2,925 2,739 2,925 186 6.8%
Total Expenses 602,945 561,936 340,652 365,535 943,597 927,471 (16,126) (1.7)% Increase (Decrease) in Net
Position Before Transfers (24,571) 195,401 11,521 29,905 (13,050) 225,306 238,356 (1,826.5)% Transfers (7,781) (7,899) 7,781 7,899 — — — —%
Change in Net Position (32,352) 187,502 19,302 37,804 (13,050) 225,306 238,356 (1,826.5)% Net Position - Beginning 1,055,225 1,022,873 1,562,562 1,581,864 2,617,787 2,604,737 (13,050) (0.5)% Change in Accounting Estimate — — — 26 — 26 26
Cumulative Effect of Accounting
Change - GASB 87 — (82) — 1,235 — 1,153 1,153 —% Net Position - Beginning Restated 1,055,225 1,022,791 1,562,562 1,583,125 2,617,787 2,605,916 (11,871) (0.5)% Net Position - Ending $ 1,022,873 $ 1,210,293 $ 1,581,864 $ 1,620,929 $ 2,604,737 $ 2,831,222 $ 226,485 8.7% CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 10 MANAGEMENT DISCUSSION & ANALYSIS Analysis of Changes in Government-Wide Net Position
The City’s overall Net Position increased slightly to $2,831.2 million : a $ 218.0 million ( 8.4%) increase from fiscal year 2021’s Net Position of $2,604.7 million. Most notably, the Unrestricted Net Position increased; going from $384.2 million in fiscal year 2021 to $583.8 million in fiscal year 2022.
Several factors contributed to the overall increase in Net Position:
• City Revenues grew $222.2 million ( 23.9%), going from $ 930.5 million in fiscal year 2021 to $1,152.8 million in fiscal year 2022. The overall growth in revenues was caused by a $148.9 (43.6%) increase in Charges for Services, a $48.8 million (50.4%) increase in Operating Grants, and $43.1 (13.2%) million of growth in General Revenues. • City Expenses decreased from $ 943.6 million incurred in fiscal year 2021 to $927.5 million in fiscal year 2022. That overall decrease can be bifurcated as follows: Governmental Activities Expenses decreased $41.0 million (- 6.8%), while Business-Type Activities Expenses increased $24.9 million ( 7.3%). The primary causes behind the decrease in Governmental Activities Expenses were a $34.7 million decrease in Public Protection expenses and a $21.8 million million reduction in Public Ways and Facilities expenses. On the Business-Type Activities side, a $12.1 million increase in the Water's expenses, $4.9 million rise in Transit's expenses, $4.1 million increase in the Convention Center expenses, and $4.2 million increase in expenditures in the Sewer Fund.
• Total Assets went from $4,001.0 million in fiscal year 2021 to $4,869.0 million in fiscal year 2022:
a $868.0 million (21.7%) increase. The increase in Total Assets was due primarily to a $712.5 million increase in the Net Pension Asset (from $93.2 million in fiscal year 2021 to $805.7 million in fiscal year 2022: a 764.5% increase), which was partially offset by a decrease in two areas:
– a $143.3 million decrease in Capital Assets not being depreciated (from $815.3 million in fiscal year 2021 to $672.1 million in fiscal year 2022: a -17.6% decrease); and, – a $4.3 million decrease in Net Receivables related to Loans, Notes, Leases, and Other (from $95.0 million in fiscal year 2021 to $90.7 million in fiscal year 2022: a -4.6% decrease) • Total Deferred Outflows of Resources decreased by $146.1 million (- 56.0%) from fiscal year 2021's figure of $260.7 million, mainly due to a $140.3 million decrease of Deferred Outflows - Pensions and a $5.4 million decline in Deferred Outflows - OPEB. • Total Liabilities shrank $27.1 million (- 1.7%) from $1,615.4 million in fiscal year 2021 to $1,588.3 million in fiscal year 2022. The overall decrease in Total Liabilities was mainly attributable to a decrease of $3.2 million in Accrued Liabilit ies (primarily caused by decreases in accounts payable and subsequent disbursements at the end of fiscal year 2022) and a decrease of $30.2 million in Long Term Liabilities (primarily due to a $16 million decrease in Net OPEB liability in addition to a $9.4 million decrease in long-term bond s payable due to normal debt service payments).
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 11 MANAGEMENT DISCUSSION & ANALYSIS • A $522.5 million ( 1,256.4%) increase in the Deferred Inflows of Resources, specifically, the Pension Revenue Applicable to Future Years.
Governmental Activities
In fiscal year 2022, Governmental Activities increased their Net Position by $179.0 million ( 17.5%) to $1,201.8 million. The increase in Net Position occurred primarily within the Net Investment in Capital Assets, which grew by $41.7 million to fiscal year 2022's Net Investment in Capital Assets of $836.4 million, and the Unrestricted Net Position, which increased by $133.8 million to fiscal year 2022’s Unrestricted Net Position Deficit of - $57.0 million. Key factors affecting the Unrestricted Net Position Deficit were:
• Revenues grew strongly, going from $ 578.4 million in fiscal year 2021 to $757.3 million in fiscal year 2022: a $ 179.0 million (30.9%) increase. The overall increase was primarily the product of growth in two revenue categories. First, Charges for Services rose $85.8 million ( 117.1%) to $159.2 million . Second, General Revenues increased by $65.8 million ( 20.0%): from $329.6 million in fiscal year 2021 to $395.4 million in fiscal year 2022. Almost all of the growth in this category can be attributed to a $67.6 million million increase in Sales Tax. • Expenses decreased from $ 602.9 million in fiscal year 2021 to $561.9 million in fiscal year 2022, led by a -17.7% decrease in Public Ways and Facilities expenses (from $123.1 million in fiscal year 2021 to $101.3 million in fiscal year 2022), a -11.4% decrease in Public Protection expenses (from $305.2 million in fiscal year 2021 to $270.5 million in fiscal year 2022), and a - 1.8% decrease in Culture and Recreation costs (from $30.9 million in fiscal year 2021 to $30.3 million in fiscal year 2022. Most of the decrease in the Public Protection and Public Ways and Facilities expenses can be attributed to decreased personnel Pension expenses. Decreases in Culture & Recreation expenses can be attributed to a reduction in council motion and Fleet Acquisition expenses.
• Total Assets increased by $685.9 million (41.4%) from fiscal year 2021’s Total Assets balance of $1,656.7 million . The overall increase in Total Assets was primarily caused by an increase of $566.1 million (722.8%) in the Net Pension Asset to $ 644.4 million. This increase was partially offset by a decrease in Restricted Cash of $30.0 million (- 18.4%) to $133.2 million . The main driver of the decrease in restricted cash was the result of the distribution of American Rescue Plan Act funding to the residents of the City.
• Total Liabilities decreased by - 0.9%, or $ 7.5 million , from fiscal year 2021’s Total Liabilities of $806.0 million. A $7.1 million decrease in Unearned Revenue (from $113.8 million in fiscal year 2021 to $106.6 million in fiscal year 2022) generated by unspent grant funds and decrease in total Long-Term Liabilities (Due Within a Year and Due in More than One Year, combined) of $5.7 million (-0.9%) caused by normal debt service payments made during the year.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 12 MANAGEMENT DISCUSSION & ANALYSIS Governmental Activities - Charts and Graphs
The following charts and graphs illustrate the City’s governmental revenues by source and its expenses and revenues by function. As can be seen, Public Protection is by far the largest function reflecting the City’s greatest overall expenses.
Fiscal Year
% of Total Revenue
Governmental ActivitiesRevenue by Type (2 Year Comparative) 21%
13%
10%
7%
17%
23%
3%
4%
25%
22%
20%
25%
4%
6%
Charges for ServicesOperating Grants & ContributionsCapital Grants & ContributionsBusiness TaxesSales TaxProperty TaxesOther Local Taxes 2022
2021
020406080100
Fiscal Year
% of Total Expenses
Governmental ActivitiesExpenses by Type (2 Year Comparative) 48%
51%
18%
20%
10%
7%
5%
5%
16%
15%
2%
2%
Public ProtectionPublic Ways and FacilitiesCommunity DevelopmentCulture and RecreationGeneral GovernmentInterest and Long-Term Debt 2022
2021
020406080100
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 13 MANAGEMENT DISCUSSION & ANALYSIS (in Millions)
Program Revenues and Expenses - Governmental Activities (2 Year Comparative)
2022 Program Revenues2021 Program Revenues
2022 Expenses2021 Expenses
Public ProtectionPublic Ways and FacilitiesCommunity DevelopmentCulture and RecreationGeneral GovernmentInterest on Long-Term Debt $0
$50
$100
$150
$200
$250
$300
$350
The following is an analysis of some of the funds within the Governmental Activities category:
General Fund
Fund Balance in the General Fund increased from $ 102.9 million in fiscal year 2021 to $ 104.7 million in fiscal year 2022. It is significant to note that the Unassigned Fund Balance decreased from $ 43.0 million in fiscal year 2021 to $37.1 million in fiscal year 2022: a $5.9 million (-13.8%) decrease.
Fiscal year 2022's revenues showed marked growth when compared to fiscal year 2021’s revenues; increasing by $30.6 million ( 8.1%) from fiscal year 2021’s total of $ 377.0 million . The increase was primarily in Taxes, which increased $35.2 million (10.8%). The main driver in the overall increase in Tax Revenue came from $67.6 million of growth in Sales Tax revenue. Additional growth in the Tax Revenue category was provided by Property Taxes, which grew $4.3 million due to increased property assessed valuations.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 14 MANAGEMENT DISCUSSION & ANALYSIS General Fund expenditures decreased by $ 13.7 million , or - 3.5%, to a total of $ 374.4 million . The change in expenditures can be explained by the following factors:
• A decrease in General Government expenditures, which decreased from $58.6 million in fiscal year 2021 to $27.1 million in fiscal year 2022: a $31.5 million, or -53.7% decrease. • A decrease in Culture and Recreation expenditures, which decreased from $23.7 million in fiscal year 2021 to $16.7 million in fiscal year 2022: a $7.0 million, or -29.6% decrease. • The decreases in expenditures were offset by Public Protection expenditures, which increased from $250.5 million in fiscal year 2021 to $263.2 million in fiscal year 2022: a $12.7 million, or 5.1%, increase. The Public Protection increase was primarily due to additional personnel costs, which increased $15.2 million over fiscal year 2021's personnel costs. A rise of $6.3 million in Capital Outlay expenditures, which grew from $13.4 million to $19.6 million, or 47.0%. $7 million of the overall increase was primarily caused by the purchase of the Tower Theater. The Tower Theater purchase was funded with the City's allocation of Measure P dollars.
A large portion of the difference between actual expenditures and actual revenues was funded by transfers from other funds. Overall, Transfers In decreased $66.4 million (-88.5%) to $8.6 million.
The additional revenues produced a large increase in Total Assets, which grew $8.7 million (5.3%) to $171.6 million. The increase was driven by two accounts:
• Restricted Cash, which rose $7.5 million (18.5%) to $48.2 million • Due from Other Funds, which increased $8.39 million (135.1%) to $14.6 million While Total Assets grew significantly, the percentage growth in Total Liabilities exceeded that of Total Assets. Total Liabilities rose $5.8 million (15.3%) to $43.8 million. The overall increase in Total Liabilities can be attributed to an increase of $ 0.8 million in Unearned Revenue and an increase of $5.5 million (58.0%) in Deposits From Others. Deposits From Others increased due to an increase in the balance of deposits held from outside individuals and organizations tied to various City Fees.
Significant committed fund balance amounts of the General Fund include:
• $39.9 million for the General Fund Emergency Reserve, • $4.5 million for the General Fund - Housing Reserve, and • $2.57 for the 27th Pay Period Reserve.
General Fund Budget to Actual Comparison
The fiscal year 2022 Adopted Budget was made up of $492.6 million of budgeted revenues and $449.6 million of appropriations. After various amendments were made throughout the fiscal year, the General Fund ended the fiscal year with $ 630.8 million of budgeted revenues and $ 587.4 million of appropriations. Actual results on a budgetary (cash) basis of accounting were $ 560.3 million of revenues and $ 460.8 million of expenditures. Thus, the actual revenues were $ 70.5 million (- 11.2%) under the fiscal year-end budgeted revenues, while the actual expenditures were $ 126.6 million (-21.6%) under fiscal year-end appropriations.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 15 MANAGEMENT DISCUSSION & ANALYSIS The major differences between the budget and the actual results are noted below:
Comparison of Revenues and Expenditures - Budget to Actual / General Fund (in thousands)
Budgeted
Original
Budgeted
Final
Actual
Budgetary
Basis
Over (Under)
Final Budget Explanation
Revenues:
Property Taxes $160,000 $160,000 $154,703 ($5,297)
Slow down in housing market occurred after County's
Assessed Tax Roll was published July 2021, which showed strong assessed valuations at the time.
Sales Tax $116,096 $128,436 $148,766 $20,330 Higher than anticipated sales tax was received due to proceeds from increased local consumer spending.
Licenses and
Permits $14,215 $14,243 $9,047 ($5,196) Anticipated permit fees for cannabis dispensaries were not received during the fiscal year.
Transfers from
Other Funds $7,480 $114,217 $31,296 ($82,921) Lower than budgeted transfers of CARES and ARPA funds into the General Fund.
Expenditures:
Other General
Government $37,664 $52,158 $32,070 ($20,088) COVID-19 mitigation expenditures, and costs for animal control services and shelter operations were less than budget.
Public Ways &
Facilities $26,308 $64,463 $19,173 ($45,290)
Spending on street repair and replacement, median island maintenance, street sweeping, and ARPA funded
neighborhood infrastructure projects was less than budget..
Community
Development $43,159 $62,034 $36,187 ($25,847) Expenditures for ARPA funded special projects and specialized services were less than budget.
Capital Outlay $5,335 $44,100 $21,324 ($22,776) Expenditures for ARPA funded capital projects were lower than budget.
A more detailed look at the budget versus actual comparison for the General Fund can be found on page 171 in the Required Supplementary Information section.
Grants Special Revenue Fund
Fund Balance in the Grants Special Revenue Fund dropped from $ 52.6 million in fiscal year 2021 to $32.3 million in fiscal year 2022. Total Liabilities decreased from $124.0 million in fiscal year 2021 to $117.1 million in fiscal year 2022: a $6.9 million (- 5.6%) Decrease. This is mainly due to Unearned Revenue decreasing from $109.9 million in fiscal year 2021 to $97.7 million in fiscal year 2022: a - 11.1% decrease.
Fiscal year 2022 revenues in the Grants Special Revenue Fund were up $2.3 million ( 2.2%) to $105.0 million. Contributing to the increase in revenue was $4.6 million of Community Development Block Grant funds which was offset by corresponding expenditure growth. Expenditures grew $71.5 million (144.0%) from fiscal year 2021’s level of $49.7 million to fiscal year 2022’s total of $121.2 million.
Large increases were seen in the General Government category (up $25.3 million, or 235.6%), Public Protection category (up $17.9 million, or 474.4%), Capital Outlay category (up $12.6 million, or 117.8%), and Community Development category (up $12.5 million , or 178.6%). The increase in the General Government category was due to $19.4 million of ERAP payments made to recipients and community based organizations. The increase in the Public Protection category was primarily due to $14.9 million increase for personnel costs.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 16 MANAGEMENT DISCUSSION & ANALYSIS Other Governmental Funds
Fund Balance for the Other Governmental Funds rose $60.8 million between fiscal year 2021 and fiscal year 2022 ($ 158.8 million versus $ 219.6 million , respectively). The growth in the Fund Balance was primarily due to a $31.2 million increase in Fund Balance for the Measure P fund, a $9.2 million increase in the UGM fund, and a $14.9 million increase in the Measure C fund. The Measure P fund is a source of revenue new to the City in 2022 which helps ensure Fresno’s neighborhoods receive funding to improve and maintain parks and facilities, create new parks and trails, and fund recreation, community, and arts programs.
Business-Type Activities
Business-Type Activities for fiscal year 2022 increased the Net Position by $39.1 million ( 2.5%) over fiscal year 2021’s Business-Type Activities Net Position of $1,581.9 million. Key factors affecting the Net Position were:
• Total Assets increased by $182.2 million (7.8%) from fiscal year 2021’s Total Asset balance of $2,344.3 million. This rise was primarily due to an increase of $146.3 million (983.8%) in the Net Pension Asset to the fiscal year 2022 figure of $161.2 million and an increase of $129.6 million (10.1%) in the Net of Accumulated Depreciation to the fiscal year 2022 figure of $1,409.0 million . This was offset by a $165.4 million (- 34.4%) decrease in assets Not Being Depreciated to the fiscal year 2022 figure of $315.8 million • Total Liabilities fell by - 2.4%, or $19.6 million, from fiscal year 2021’s Total Liabilities of $809.3 million. The decline was primarily due to a $28.3 million (-4.1%) drop in Long-Term Liabilities. • Revenues went from $352.2 million in fiscal year 2021 to $395.6 million in fiscal year 2022: a $43.4 million ( 12.3%) increase. This growth can be attributed to a $15.0 million ( 57.3%) increase in Transit Operating Grants. The City also saw a $63.0 million increase in Charges for Services. The increase in Charges for Services were primarily driven by Airports ( $14.9 million,
57.3%) and Transit ( $13.6 million , 582.9%). The increase Operating and Charges for Services revenue was offset by a $22.5 million decrease in General Revenues compared to the prior year.
• Expenses went from $ 340.7 million in fiscal year 2021 to $365.5 million in fiscal year 2022: a $24.9 million (7.3%) increase. The primary driver behind this increase was $ 12 million (12.1%) of growth in the Water Fund's expenses, partially due to an increase in the cost of purchasing water for the City's residents. Additionally, growth of $4.9 million (7.4%) in the Transit Fund's expenses and $4.2 million ( 5.7%) in the Sewer Fund's expenses. Increases in both Transit and Sewer are due mainly to increased cost of providing service, including repairs and maintenance and fuel cost) added to the overall increase in Business-Type Activities expenses.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 17 MANAGEMENT DISCUSSION & ANALYSIS Business-Type Activities - Charts and Graphs
The following charts and graphs illustrate the City’s Business-Type revenues and expenses by both source and function. Sewer, Water, and Solid Waste are the largest Business-Type Activities reflecting the City’s greatest overall expenses.
Fiscal Year
% of Total Revenue
Business-Type Activities
Revenue by Type
(2 Year Comparative)
84%
76%
18%
16%8%
Charges for Services
Operating Grants
& Contributions
Capital Grants
& Contributions
Interest & Investment
Income
2022
2021
020406080100
Fiscal Year
% of Total Expenses
Business-Type Activities
Expenses by Type
(2 Year Comparative)
19%
19%
66%
66%
3%
1%
12%
13%
1%
1%
Transit
Sewer, Water, Solid Waste,
& Community Sanitation
Convention Center
Airport
Stadium
2022
2021
020406080100
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 18 MANAGEMENT DISCUSSION & ANALYSIS (in Millions)
Business-Type Activities
Program Revenues and Expenses
(2 Year Comparative)
2022 Program Revenues2021 Program Revenues
2022 Expenses2021 Expenses
AirportConvention CenterParks & RecreationStadiumSewer, Water, Solid Waste & Community Sanitation
Transit
$-25
$0
$25
$50
$75
$100
$125
$150
$175
$200
$225
$250
$275
$300
The following is an analysis of some of the funds within the Business-Type Activities category:
Water
The Water Fund's (Water) Net Position showed an increase over fiscal year 2021’s levels. Net Position grew from $517.1 million in fiscal year 2021 to $534.8 million in fiscal year 2022: a $17.8 million (3.4%) increase. The change in net position was driven by the following factors:
• Water revenues increased from $ 127.7 million in fiscal year 2021 to $ 138.5 million in fiscal year 2022: a $10.8 million (8.5%) increase. The increase was driven by a $6.6 million rise in Pension revenue, and $1.8 million of growth in Water Infrastructure Development Charges.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 19 MANAGEMENT DISCUSSION & ANALYSIS • Water's Operating Expenses increased by $ 12.6 million ( 14.5%) to $ 99.4 million in fiscal year 2022. The increase in expenses was primarily the result of a $9.1 million ( 85.7%) increase in Administration costs (primarily in loans within the City) and a $3.7 million ( 8.0%) increase in Cost of Services (primarily in water purchases).
• Total Assets increased from $ 959.2 million in fiscal year 2021 to $ 996.4 million in fiscal year 2022, a $ 37.1 million ( 3.9%) increase. A $ 8.2 million increase in Unrestricted Cash was the primary cause of the overall decrease in Water's assets. • Total Liabilities fell by $8.5 million (-1.9%) from $450.8 million in fiscal year 2021 to $442.4 million in fiscal year 2022. The overall decline in Total Liabilities was caused by a $9.5 million (-2.9%) decrease in the Long-Term Notes Payable in addition to a $2.5 million (-33.9%) decrease in Net OPEB Obligation.
Sewer
The Sewer Fund's Net Position increased by $6.4 million (0.9%), from $716.4 million in fiscal year 2021 to $722.7 million in fiscal year 2022. The driver behind the Net Position increase was an increase of $21.3 million (18.8%) in Current Assets, an increase of $11.0 million (21.0%) in Total Restricted Assets, and an increase of $19.6 million (83.0%). This was offset by a $20.1 million (1,664.7%) increase in Total Deferred Inflows, a $16.2 million (-2.5%) decrease in Capital Assets, and a $4.3 million (3.3%) increase in Total Liabilities from fiscal year 2021’s figure of $131.8 million.
The growth in Current Assets and Total Other Assets powered an increase of $35.7 million (4.3%) in Total Assets to $876.4 million. The overall increase in Current Assets was primarily caused by a $10.1 million increase in Unrestricted Cash. The overall increase in Total Other Assets was due to a $24.15 million increase in Net Pension Asset. These increases were partially offset by a decrease in Capital Assets of $16.2 million (- 2.5%). The decrease in Capital Assets was mainly caused by a $25.0 million (7.5%) increase in Accumulated Depreciation and a $82.4 million (-66.8%) decrease related to Construction in Progress.
The growth in Total Liabilities was primarily caused by a $7.8 million ( 9.0%) increase in Long-Term Notes Payable: specifically, those for the Southwest Recycled Water project. The growth in Long- Term Notes Payable was offset by a decrease in Other Liabilities caused by a decrease in the balance of Capacity Rights totaling $2.7 million (- 65.8%) and a decrease in Net OPEB Obligation totaling $2.3 million (-34%).
The Unrestricted Cash was also bolstered by Operating Income of $11.7 million, which was an increase from fiscal year 2021's Operating Income of $8.4 million. Revenues were up slightly ( $9.9 million, or
12.6%) due to increases in Charges for Services; specifically an increase in Customer User Charges of $4.2 million and an increase in Pension Revenue of $5.9 million. Operating Expenses grew by $6.6 million (9.5%). The Operating Expense growth consisted primarily of $ 5.8 million in Costs of Services such as an increase of $2.1 million in Utilities charges and a $3.1 million increase in repairs & maintenance adjustments.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 20 MANAGEMENT DISCUSSION & ANALYSIS Solid Waste Management
The Solid Waste Management Fund's (Solid Waste) Net Position declined from fiscal year 2021’s figure of $32.7 million to fiscal year 2022’s figure of $29.4 million: a $3.4 million (-10.2%) decrease. The Net Position decrease was primarily due to a $12.8 million (1,532.7%) increase in Total Deferred Inflows of Resources, which included a $11.2 million (20,443.6%) increase in Unamortized Pension Expense to the fiscal year 2022 total of $11.3 million. In addition, Total Restricted Assets decreased by $6.2 million (-37.7%) to $10.2 million and this was offset by a $17.9 million increase in Net Pension Asset to the fiscal year 2022 total of $20.2 million.
Solid Waste's operational results were reflected on the fund's Statement of Net Position by a decrease of $4.5 million in Cash and Investments and Total and a $6.2 million decrease in Total Restricted Assets, offset by a $17.9 million increase in Net Pension Asset and a $11.2 million increase in Unamortized Pension Expense.
Transit
The Transit Fund saw a bounce back from the prior years' impact caused by the COVID-19 pandemic, which had a major impact on the Transit Fund (Transit) during 2020 and 2021. Ridership increased in 2022. Transit transported 7.0 million passengers in fiscal year 2022, a 25% increase from fiscal year 2021’s ridership 5.6 million passengers. The 5.6 million passengers was the lowest passenger count that Transit has experienced in over twenty years.
Transit's revenues increased $13.6 million (582.9%) to $11.2 million. The main driver of the increase in revenue was a $11.3 million increase in Pension Revenue. Operating Expenses grew $4.6 million (7.1%).
Increases in contract transportation (up $1.0 million), and special projects expenses (up $0.8 million) were the main causes in Transit's overall Operating Expense increase.
Transit's operating results would have resulted in a significant reduction in Net Position were it not for a large influx of grant funding from federal and state agencies. That influx can be seen in a $15.0 million (31.3%) increase in Operating Grant Revenue to $62.9 million. These awards also drove growth in Total Restricted Cash, which went from $25.0 million in fiscal year 2021 to $53.80 million in fiscal year 2022: a $28.8 million (114.8%) increase. The increase in Total Restricted Cash was offset by a decrease in Grants Receivable of $26.3 million (-82.3%). The impact of additional grant funding caused the Transit Fund's Net Position to grow by $10.1 million (7.0%) from $144.6 million in fiscal year 2021 to $154.6 million in fiscal year 2022.
Airports
Airports' Fund saw a return to pre-pandemic passenger levels with fiscal year 2022's origin and destination passengers numbering 2,210,005, 70.0% higher than the prior fiscal year's passenger count of 1,294,591. The increase in passenger levels brings the ridership above levels seen prior to the pandemic.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 21 MANAGEMENT DISCUSSION & ANALYSIS The increase in passenger traffic had an impact on Operating Revenues, which increased $12.6 million (57.9%) to $34.4 million . The overall increase in Operating Revenues was powered by increases in passenger driven and airline activity revenues, particularly Parking Revenues, which rose to $4.9 million (26.4%). Y et, while revenues increased by 57.9%, Operating Expenses only increased by $1.8 million (5.4%) to a total of $34.6 million. The increase in Operating Expenses was primarily driven by an increase in professional consulting services.
The increase in revenues and small change in expenses had a predictable effect on Total Assets, which increased $32.8 million (11.8%) to $310.6 million. The overall increase in Total Assets was due to several factors:
• A $15.1 million (491.0%) increase in Net Receivables
• A $9.3 million (25.9) increase in Construction in Progress • A $7.5 million (10.6%) increase in Infrastructure
• A $6.3 million (28.0%) increase in Current Unrestricted Cash.
In addition to the increase in Total Assets, Airports experienced a decrease in Total Liabilities, which shrank $6.1 million (-6.6%) to $86.4 million. Current Liabilities also decreased by $1.7 million (-15.8%) to $9.0 million; led by a $2.6 million decrease in Accounts Payable.
The increase in Total Assets and the decrease in Total Liabilities resulted in Total Net Position increasing by $9.6 million (5.0%) from fiscal year 2021's Net Position of $189.9 million to $199.5 million.
Convention Center
While the Convention Center Fund (Convention Center) was the City operation most impacted by COVID-19 restrictions during fiscal year 2021 when no events took place, fiscal year 2022 saw the return of events at the Convention Center. Consequently, Convention Center recorded $5.7 million of revenue in fiscal year 2022: a $5.7 million (287,300.0%) increase.
Along with an increase in revenues due to increased event activity, Convention Center's expenses also increased. The total increase of $ 4.4 million ( 107.2%) from fiscal year 2021’s expenses of $ 4.1 million to a total of $ 8.4 million were led by a $2.3 million increase in Salaries/Benefits expenses and a $1.1 million increase in Repairs and Maintenance expenses.
Due to a greater increase in revenues than in expenses, the Convention Center's Net Position managed to go from - $1.2 million in fiscal year 2021 to $2.6 million in fiscal year 2022: a $3.8 million (318.9%) improvement. A drop of $7.1 million (- 27.1%) in Total Liabilities, mainly caused by a $4.0 million decline in Bonds Payable as a result of scheduled debt service payments, contributed significantly to the improvement in Net Position. This decline in Bonds Payable was partially offset by an overall decline in Total Assets of $3.2 million (-12.9%) from fiscal year 2021's Total Assets figure of $24.9 million . An increase of $2.0 million ( 2.8%) in Accumulated Depreciation was the major contributor to the decline in Total Assets.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 22 MANAGEMENT DISCUSSION & ANALYSIS Stadium
Even though baseball was played at the stadium, financial results from those games were impacted both by COVID-19 restrictions and a new operating agreement with Major League Baseball. In December 2020, Major League Baseball completed its overhaul of the minor league system. As a result of that overhaul, Fresno's baseball team moved from a AAA affiliation to an A affiliation. This move to a lower affiliation resulted in modification to the operating lease between the City and the team. Among the changes to the terms of the lease were:
• Annual rent was reduced from $500,000/year to $100,000/year. • City agreed to pay up to $300,000/year in utility costs. • Annual capital contribution made by the team and the City decreased from $300,000/year to $50,000/year from each party.
• City will receive $15% of any naming rights revenues above $650,000/year (escalating 2% per year).
• Team will pay $1/ticket for any turnstile attendance over 150,000/year.
In spite of the reduced financial contribution from the team, th e Stadium Fund continued to build on the improvement in Net Position it displayed in fiscal year 2021. Net Position grew from $5.1 million in fiscal year 2021 to $ 6.2 million in fiscal year 2022. Two factors drove the overall increase in Net Position:
• A $1.7 million (- 6.7%) decrease in Total Liabilities, primarily Bonds Payable as a result of scheduled debt service payments.
• A $1.0 million ( 3.4%) increase in Total Assets, primarily $1.3 million of increased Accumulated Depreciation offset by $1.8 million of increased Construction in Progress and $1.2 million of increased Machinery and Equipment.
Internal Service Funds
The Net Position deficit in the Internal Service Funds grew by $15.3 million (37.1%) to - $56.6 million in fiscal year 2022. The increase in the Net Position deficit was primarily due to an increase of $25.0 million ( 17.2%) in the Short-Term and Long-Term (combined) Liability for Self-Insurance and $26.1 million ( 369.6%) increase in Due to Other Funds. Partially offsetting these liability increases were increases of $29.3 million ( 28.7%) in Unrestricted Cash and $11.9 million ( 14.4%) in Total Net Capital Assets.
The Internal Service Funds' Statement of Revenues, Expenses, and Changes in Net Position mirrored the results of the Statement of Net Position. Contributors to the increase in expenses are a $2.5 million increase of the Fleet Management Fund's fuel cost and a $3.4 million increase in Repairs and Maintenance expense from both the Information Services Internal Service Fund and the Fleet Management Fund.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 23 MANAGEMENT DISCUSSION & ANALYSIS
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets
The City’s capital assets for its Governmental and Business-Type Activities, before Component Units, as of June 30, 2022 , amount to $2,722.7 million (net of accumulated depreciation). Capital assets include land, buildings and improvements, machinery and equipment, park facilities, roads, streets, traffic signals, streetlights, bridges, and construction in progress. The City’s capital assets net increase for the current fiscal year was approximately 1.1% (a 6.8% increase for Governmental Activities, a - 2.0% decrease for Business-Type Activities) as shown in the table below. Capital assets for the fiscal year ended June 30, 2021 amounted to $2,702,619 million (net of accumulated depreciation). The net increase for 2021 was approximately 0.2% (a 0.3% decrease for Governmental Activities, a 0.4% increase for Business-Type Activities) Changes in Capital Assets, Net of Depreciation
(in thousands)
Asset Category Governmental
Activities
Business-Type
Activities
Total
Government-Wide
2021 2022 2021 2022 2021 2022
Land $263,040 $270,918 $54,426 $53,867 $317,466 $324,785 Intangibles (Indefinite Life) — — 17,949 18,897 17,949 18,897 Buildings and Improvements,
Net 144,950 178,525 581,285 847,332 726,235 1,025,857 Machinery and Equipment, Net 60,872 65,982 37,733 39,798 98,605 105,780 Infrastructure 402,107 397,715 660,335 521,307 1,062,442 919,022 Construction In Progress 71,103 85,336 408,819 243,040 479,922 328,376 Total $942,072 $998,476 $1,760,547 $1,724,241 $2,702,619 $2,722,717 Major capital asset events during fiscal year 2022, some of which were in progress during the previous fiscal year, included the following:
† South Van Ness Industrial Roadway and Utilities Infrastructure Improvement Project The City’s Public Works Department completed the South Van Ness Industrial Project, in coordination with and to benefit many of the South Van Ness industrial area businesses, under a grant from the U.S. Economic Development Administration (EDA). The project consisted of replacing or installing concrete curb and gutter, street widening or pavement replacement as needed and resurfacing, storm drain infrastructure, traffic access & circulation improvements, and safety enhancements for the South Van Ness Industrial Area in the City of Fresno. † Housing for Homeless Assistance
In FY22, the City purchased multiple motels to provide emergency shelter for homeless residents. In total, the Valley Inn, Ambassador Inn, Villa Motel, and Parkway Inn provided shelter for more than 270 residents. The Travel Inn, purchased in FY21 finished being rehabilitated in FY 22 and provides shelter for more than 150 residents.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 24 MANAGEMENT DISCUSSION & ANALYSIS † Animal Control Facility
The Animal Control Facility is located on the 5.1-acre property with an address of 5277 E.
Airways Blvd, Fresno, CA 93727. The facility will contain five buildings, ranging in sizes from approximately 6,650 to 14,897 sq. feet and a total building area of 51,928 sq. feet. The five buildings in the complex will consist of a main building for the administrative, operational, and customer service uses; a second building that will house the veterinarian services and isolation rooms for injured and recovering animals; and the remaining three buildings will provide animal housing. The facility allows for the annual intake of approximately 10,000-15,000 animals, with about 8,000-12,000 of those being dogs and 1,000-3,000 being cats. Staff worked with experts in the field to ensure the new facility will be meet the needs of the City of Fresno residents and allow for the humane care and treatment of all animals while they are in the City’s animal shelter. The facility provides an adequate number of kennels and play yards for the animals, while also providing adequate space for personnel to intake animals and process adoptions. Additionally, the facility includes a medical suite for veterinarian services, including but not limited to, emergency care for injured animals, spay and neuter surgeries, and the delivery of vaccinations.
At June 30, 2022, the City had commitments related to various construction projects associated with Governmental Activities totaling $ 18.9 million . Commitments connected with Business-Type Activities at fiscal year-end amounted to $ 60.4 million . The most significant of the Governmental Activities projects were the installation of various traffic signals throughout Fresno ( $13.8 million ).
The most significant of the Business-Type Activities projects were the Collection System Rehabilitation & Extensions ( $11.0 million ) and PTMISEA ( $8.2 million ). A complete list of projects appear in Note 13(H) - Commitments and Contingencies, page 160 under Construction and Other Significant Commitments.
Debt Administration
At the end of fiscal year 2022, the City had total long-term bond obligations, notes, and leases payable outstanding of $880.7 million. Of this amount, $ 88.6 million are obligation bonds, backed by the full faith and credit of the City, while $ 629.0 million are revenue bonds and notes of the City’s business enterprises and $ 1.6 million are tax allocation debt issued by the Successor Agency of the Redevelopment Agency. The remaining $161.5 million includes lease revenue bonds, notes and capital leases for general governmental projects. For detailed information on the City's debt, see Note 7- Long Term Liabilities, pages 101-120.
During fiscal year 2022, the City’s total bonded debt decreased by $16.7 million. This decrease was due to both normal debt service payments made during the year , netted by an increase in loans to the Water Division by the State Water Resources Control Board.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 25 MANAGEMENT DISCUSSION & ANALYSIS The City also took the following actions in fiscal year 2022:
• Drew down from the California State Water Resources Control Board an additional $13.3 million in already-approved loans for water transport projects and sewer projects. • Borrowed an additional $4.6 million through the Master Equipment Lease Purchase Agreement with Banc of America Public Capital Corp for public safety vehicles. • Borrowed $19.9 million for energy efficiency projects that will offset savings in expenses paid to PG&E.
The ratio of net general obligation bonded debt to taxable valuation and the amount of bonded debt per capita are useful indicators of the City's debt position to management, citizens and investors. A comparison of these indicators (as stated in thousands) follows:
Fiscal Year
2022 2021 2020
General Bonded Debt (Par Amount) $ 88,640 $ 98,395 $ 107,555 General Bonded Debt Per Capita $ 163.00 $ 180.00 $ 197.00 Debt Service Tax Rate Per $100 Taxable Valuation $ 0.21 $ 0.24 $ 0.28 Although the City’s Charter imposes a limit on the amount of general obligation bonds that the City can have outstanding at any given time of 20% of the assessed value of property in the City, the City realizes that it cannot currently support debt of that magnitude with its current tax base and is very cautious about issuing general obligation debt. Currently, there are no general obligation bonds outstanding other than Pension Obligation Bonds issued in 2002.
FINANCIAL OUTLOOK
The City continued to experience a strong rebound in financial performance from the impacts of the pandemic. Sales tax revenue experienced another record year of growth resulting in $192.9 million for fiscal year 2022. Meanwhile property taxes continued with steady growth due to assessed valuation increases resulting from sales. The City's local economy boasts the second strongest recovery in the United States, evidence of it's resiliency. Additionally, the City's allocation of the American Rescue Plan Act (ARPA) continue to support recovery efforts.
Nationally, risks to economic growth are increasingly present. Confronted with concerns of rising inflation, the Federal Reserve has raised interest rates multiple times in an effort to cool economic activity while avoiding a recession, a task the Legislative Analyst's Office labels as "narrow". Already, the effects of Federal Reserve actions can be seen statewide with decreases in home sales, car sales and stock prices. Unemployment rates remain at historic lows creating strain for employers to meet demand. These realities underscore the importance of prudent financial management with a sound reserve management policy. The City concluded the 2022 fiscal year with a $39.7 million General Fund Emergency Reserve.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 26 MANAGEMENT DISCUSSION & ANALYSIS The City will continue to monitor sources with particular expertise of influencing factors that may effect the fiscal condition and outlook of economic activity. Publications provided by the Legislative Analyst's Office, the UCLA Anderson Forecast and others provide invaluable insights that help shape planning.
CONCLUSION
Fiscal year 2022 continued to demonstrate financial stability along the path to broader economic recovery from the effects of the pandemic. Certainly these efforts have been significantly buoyed by State and Federal resources provided to mitigate the impacts of COVID. While encouraging, risks remain going forward. In addition to the aforementioned conditions facing the national economic landscape, significant geopolitical pressures exist threatening economic growth. These conditions cannot be understated and will surely shape planning going forward as the City seeks to provide stability in services for the citizens of Fresno.
REQUESTS FOR INFORMATION
This financial report is designed to provide citizens, taxpayers, customers, investors and creditors with a general overview of the City’s finances and to demonstrate the City’s accountability for the money it receives. Below is the contact information for questions about this report or requests for additional financial information.
Documents can be made accessible in alternative ADA compliant formats upon request. To request documents in alternative ADA Compliant formats, contact the Finance Department at [email protected] or (559) 621-7001.
CITY OF FRESNO
Office of the Controller/Finance Department
2600 Fresno Street, Room 2156
Fresno, California 93721-3622
www.fresno.gov
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 27 MANAGEMENT DISCUSSION & ANALYSIS
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28 CITY OF FRESNO, CALIFORNIA
Statement of Net Position
June 30, 2022
(in thousands)
Primary Government
Governmental
Activities
Business-Type
Activities Total
Assets
Cash and Investments $ 346,173 $ 307,108 $ 653,281
Accounts Receivables, Net 108,166 89,378 197,544
Internal Balances 22,403 (22,403) —
Inventories 1,073 7,634 8,707
Prepaid Items 562 1,371 1,933
Other Assets 1,114 520 1,634
Property Held for Resale 3,600 — 3,600
Restricted Cash and Investments 133,207 241,030 374,237 Restricted Interest Receivable — 465 465
Loans, Notes, Leases, and Other Receivables, Net 75,321 15,376 90,697 Net Pension Asset 644,438 161,215 805,653
Capital Assets:
Not Being Depreciated 356,254 315,804 672,058
Net of Accumulated Depreciation 650,249 1,408,970 2,059,219 Total Assets 2,342,560 2,526,468 4,869,028
Deferred Outflows of Resources
Charge on Refunding 3,169 138 3,307
Deferred Outflows - Pensions 65,621 14,115 79,736
Deferred Outflows - OPEB 22,208 9,338 31,546
Total Deferred Outflows of Resources 90,998 23,591 114,589 Liabilities
Accrued Liabilities 42,829 26,415 69,244
Unearned Revenue 106,643 55,366 162,009
Deposits from Others 14,912 18,997 33,909
Other Liabilities — 1,396 1,396
Long-Term Liabilities:
Due Within One Year 82,890 24,902 107,792
Due in More than One Year 551,257 662,670 1,213,927
Total Liabilities 798,531 789,746 1,588,277
Deferred Inflows of Resources
Deferred Inflows - Pension 372,040 91,838 463,878
Deferred Inflows - OPEB 51,193 22,487 73,680
Deferred Inflows - Leases 1,111 25,059 26,170
Total Deferred Inflows of Resources 424,734 139,384 537,948 Net Position
Net Investment in Capital Assets 836,439 1,094,088 1,930,527 Restricted for:
General Government 27,372 — 27,372
Public Protection 3,943 — 3,943
Public Ways and Facilities 128,694 — 128,694
Culture and Recreation 34,936 — 34,936
Community Development 73,586 — 73,586
Emergency Reserve 39,913 — 39,913
27th Pay Period Reserve 2,566 — 2,566
Housing Reserve 4,539 — 5,881
Asset Sale Reserve 1,342 — 1,342
Unrestricted (Deficit) 56,963 526,841 583,804
Total Net Position $ 1,210,293 $ 1,620,929 $ 2,832,564
The notes to the financial statements are an integral part of this statement. 29 ]
CITY OF FRESNO, CALIFORNIA
Statement of Activities
Fiscal Year Ended June 30, 2022
(in thousands)
Net (Expense) Revenue and Changes in
Net Position
Program Revenue Primary Government
Operating Capital
Charges for Grants and Grants and Governmental Business-Type Functions/Programs Expenses Services Contributions Contributions Activities Activities Total Primary Government
Governmental Activities
General Government $ 90,035 $ 22,040 $ 108 $ 52,274 $ (15,613) $ — $ (15,613) Public Protection 270,465 62,152 30,645 3,306 (174,362) — (174,362) Public Ways and Facilities 101,306 37,839 31,461 65,698 33,692 — 33,692 Culture and Recreation 30,324 4,840 720 (488) (25,252) — (25,252) Community Development 57,123 32,305 11,311 7,763 (5,744) — (5,744) Interest on Long-term Debt 12,683 — — — (12,683) — (12,683) Total Governmental Activities 561,936 159,176 74,245 128,553 (199,962) — (199,962) Business-Type Activities
Water System 112,301 138,492 193 327 — 26,711 26,711 Sewer System 78,646 87,795 — 4,042 — 13,191 13,191 Solid Waste Management 41,818 35,423 206 — — (6,189) (6,189) Transit 71,038 11,242 62,915 10,253 — 13,372 13,372 Airports 40,413 40,884 7,959 3,221 — 11,651 11,651 Fresno Convention Center 9,235 5,744 — — — (3,491) (3,491) Community Sanitation 8,743 10,706 — — — 1,963 1,963 Parks and Recreation 416 630 — — — 214 214
Stadium 2,925 279 — 50 — (2,596) (2,596)
Total Business-Type Activities 365,535 331,195 71,273 17,893 — 54,826 54,826 Total Primary Government $ 927,471 $ 490,371 $ 145,518 $ 146,446 $ (199,962) $ 54,826 $ (145,136) General Revenues:
Taxes and Licenses:
Property Taxes 154,130 — 154,130
Sales Taxes - Shared Revenues 192,874 — 192,874
Franchise Taxes 18,271 — 18,271
Business Tax 21,764 — 21,764
Room Tax 15,205 — 15,205
Other Taxes 3,528 — 3,528
Investment Earnings (10,409) (24,697) (35,106)
Transfers (7,899) 7,899 —
Total General Revenues and Transfers 387,464 (16,798) 370,666 Change in Net Position 187,502 37,804 225,306
Net Position - Beginning, Restated 1,022,791 1,583,125 2,605,916 Net Position - Ending $ 1,210,293 $ 1,620,929 $ 2,831,222 The notes to the financial statements are an integral part of this statement. 30 This page intentionally left blank
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32 CITY OF FRESNO, CALIFORNIA
Balance Sheet
Governmental Funds
June 30, 2022
(in thousands)
General
Fund
Grants
Special
Revenue Fund
Other
Governmental
Funds
Total
Governmental
Funds
ASSETS
Cash and Investments $ 47,810 $ 2,971 $ 184,518 $ 235,299 Receivables, Net 18,207 485 1,892 20,584
Grants Receivable 180 18,354 1,315 19,849
Intergovernmental Receivables 42,676 — 17,511 60,187 Due From Other Funds 14,591 1,749 2,782 19,122
Advances to Other Funds, Net — 6,848 62 6,910
Property Held for Resale — — 3,600 3,600
Restricted Cash 48,180 82,852 1,286 132,318
Loans, Notes, Leases, Other Receivables, Net — 54,460 20,084 74,544 Total Assets $ 171,644 $ 167,719 $ 233,050 $ 572,413
LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND FUND BALANCES Liabilities
Accrued Liabilities $ 12,835 $ 14,944 $ 5,303 $ 33,082
Unearned Revenue 4,101 97,749 15 101,865
Due to Other Funds 1,100 4,393 2,655 8,148
Advances From Other Funds 10,862 — 2,552 13,414
Deposits From Others 14,881 — 31 14,912
Total Liabilities 43,779 117,086 10,556 171,421
Deferred Inflows of Resources
Unavailable Revenue - Property Tax 4,276 — — 4,276
Unavailable Revenue - Other 18,898 18,334 2,927 40,159 Total Deferred Inflows of Resources 23,174 18,334 2,927 44,435 Fund Balances
Restricted — 32,299 184,623 216,922
Committed 48,360 — — 48,360
Assigned 19,215 — 37,622 56,837
Unassigned 37,116 — (2,678) 34,438
Total Fund Balances 104,691 32,299 219,567 356,557
Total Liabilities, Deferred Inflows of
Resources and Fund Balances $ 171,644 $ 167,719 $ 233,050 $ 572,413 The notes to the financial statements are an integral part of this statement. 33 CITY OF FRESNO, CALIFORNIA
Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position June 30, 2022
(in thousands)
Total Governmental Fund Balances $ 356,557
Amounts reported for Governmental Activities in the Statement of Net Position are different because:
The Net Pension Asset is not a current financial resource, and therefore, is not reported in the funds. 644,438 Capital assets used in Governmental Activities are not current financial resources, and therefore, are not reported in the funds. 1,006,503
Prepaids in Governmental Activities are not current financial resources, and therefore, are not reported in the funds. 562
Deferred outflows of resources reported in the Statement of Net Position 90,998 Accrued interest on long-term debt is not accrued in the funds, but rather, it is recognized as an expenditure when due. (1,955)
Long-term liabilities, including bonds payable, are not due and payable in the current period and, therefore, are not reported in the funds. (625,434)
Difference between deferred inflows of resources reported in the Statement of Net Position and unavailable revenue reported in the Balance Sheet - Governmental Funds (380,299) Prepaid bond insurance and original issue premium and discount represent costs associated with the issuance of long-term debt, which are deferred and amortized over the period the debt is outstanding.
These costs are reported as expenditures of the current period in the funds. (7,599) Internal service funds are used by management to charge the costs of various activities, such as fleet and insurance to individual funds. Assets and liabilities of certain internal service funds are included in Governmental Activities in the Statement of Net Position. 126,522 Net Position of Governmental Activities $ 1,210,293
The notes to the financial statements are an integral part of this statement. 34 CITY OF FRESNO, CALIFORNIA
Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds
Fiscal Year Ended June 30, 2022
(in thousands)
General
Fund
Grants
Special
Revenue Fund
Other
Governmental
Funds
Total
Governmental
Funds
Revenues
Taxes $ 360,831 $ — $ 91,410 $ 452,241
Licenses and Permits 8,332 — — 8,332
Intergovernmental 5,398 99,134 34,142 138,674
Charges for Services 32,292 — 34,669 66,961
Fines 2,726 — — 2,726
Use of Money and Property (3,213) 1,262 (5,099) (7,050) Miscellaneous 1,191 4,630 2,615 8,436
Total Revenues 407,557 105,026 157,737 670,320
Expenditures
Current:
General Government 27,126 36,007 2,370 65,503
Public Protection 263,159 21,690 2,791 287,640
Public Ways and Facilities 11,311 19,532 42,600 73,443 Culture and Recreation 16,722 1,263 7,638 25,623
Community Development 33,443 19,493 4,408 57,344
Capital Outlay 19,645 23,233 32,563 75,441
Debt Service:
Principal 2,580 — 18,202 20,782
Interest 389 — 11,968 12,357
Total Expenditures 374,375 121,218 122,540 618,133
Excess (Deficiency) of Revenues Over (Under) Expenditures 33,182 (16,192) 35,197 52,187 Other Financing Sources (Uses)
Transfers In 8,587 2,100 54,013 64,700
Transfers Out (40,021) (6,238) (28,431) (74,690)
Total Other Financing Sources (Uses) (31,434) (4,138) 25,582 (9,990) Net Changes in Fund Balances 1,748 (20,330) 60,779 42,197 Fund Balances - Beginning 102,943 52,629 158,788 314,360 Fund Balances - Ending $ 104,691 $ 32,299 $ 219,567 $ 356,557 The notes to the financial statements are an integral part of this statement. 35 CITY OF FRESNO, CALIFORNIA
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities Fiscal Year Ended June 30, 2022
(in thousands)
Net change in fund balances - total governmental funds $ 42,197 Amounts reported for Governmental Activities in the Statement of Activities are different because:
Governmental funds report capital outlays as expenditures. However, in the Statement of Activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which cost of capital assets of $89,808 exceeded depreciation of $45,645 in the current period. 44,163 Some expenses, retention payable, and Net OPEB Liability reported in the Statement of Activities do not require the use of current financial resources, and therefore, are not reported as expenditures in governmental funds. (1,897) In the Statement of Net Position, acquiring debt increases Long-Term Liabilities and does not affect the Statement of Activities. Additionally, repayment of principal is an expenditure in the governmental funds but reduces liability in the Statement of Net Position. 20,721 Under the modified accrual basis of accounting used in the governmental funds, expenditures are not recognized for transactions that are not normally paid with expendable available financial resources. In the Statement of Activities, however, which is presented on the accrual basis of accounting, expenses and liabilities are reported regardless of when financial resources are available. In addition, interest on long-term debt is not recognized under the modified accrual basis of accounting until due, rather than as it accrues. (12,594)
Changes to the net pension asset and pension related deferred outflows and inflows of resources do not provide current financial resources, and therefore, are not reported in the governmental funds. 94,670
Revenues recognized in the Statement of Activities in previous years and recognized in the governmental fund statements in the current year were less than revenues recognized in the Statement of Activities in the current year but not reported in the governmental funds as they do not provide current financial resources. 6,627 Internal Service Funds are used by management to charge the costs of certain activities, such as insurance and fleet, to individual funds. The net revenues of certain activities of internal service funds are reported with Governmental Activities in the Statement of Activities. (6,385)
Change in net position of Governmental Activities $ 187,502 The notes to the financial statements are an integral part of this statement. 36 CITY OF FRESNO, CALIFORNIA
Statement of Net Position
Proprietary Funds
June 30, 2022
(in thousands)
Business-Type Activities - Enterprise Funds
Water
System
Sewer
System
Solid Waste
Management Transit Airports
Assets
Current Assets:
Cash and Investments $ 129,493 $ 105,566 $ 2,250 $ 15,698 $ 28,840 Interest Receivable 664 533 85 240 238
Accounts Receivables, Net 25,359 15,903 6,607 211 18,161 Grants Receivable — — — 5,671 763
Inventories 1,629 4,840 — 754 345
Prepaid Items 884 32 9 41 269
Intergovernmental Receivables — 921 — 7,006 137
Due from Other Funds 9,816 6,713 3,024 161 443
Restricted Cash and Investments — — — — —
Total Current Assets 167,845 134,508 11,975 29,782 49,196 Noncurrent Assets:
Restricted:
Cash and Cash Equivalents 67,638 63,405 10,207 53,804 38,313 Interest Receivable 245 220 — — —
Total Restricted Assets 67,883 63,625 10,207 53,804 38,313 Other Assets:
Other Receivables 1,207 3,089 — — —
Other Assets — 5 — — 208
Net Pension Asset 30,283 27,792 20,173 51,631 14,704 Unamortized CVP Water Settlement 822 — — — —
Solid Waste Rate Payers — — 10,258 — —
Advances to Other Funds, Net 4,019 12,302 — — —
Total Other Assets 36,331 43,188 30,431 51,631 14,912 Capital Assets:
Land and Intangibles 34,029 17,513 2,803 2,216 11,318 Buildings, Systems and Improvements 496,770 580,678 1,567 74,641 217,398 Machinery and Equipment 1,018 6,114 6,039 80,843 5,589 Infrastructure 318,442 348,797 — — 78,321
Right to Use Assets Being Amortized — 209 — — 507
Construction in Progress 139,449 40,956 2,444 12,951 45,167 Less Accumulated Depreciation (265,405) (359,236) (4,231) (69,523) (150,079) Total Capital Assets, Net 724,303 635,031 8,622 101,128 208,221 Total Noncurrent Assets 828,517 741,844 49,260 206,563 261,446 Total Assets 996,362 876,352 61,235 236,345 310,642 Deferred Outflows of Resources
Charge on Refunding — — — — 10
Pension Contributions 1,700 1,530 1,136 3,000 911
Deferred Outflows - Pension 883 801 571 1,499 501
Deferred Outflows - OPEB 1,517 1,413 979 3,400 804 Total Deferred Outflows of Resources $ 4,100 $ 3,744 $ 2,686 $ 7,899 $ 2,226 The notes to the financial statements are an integral part of this statement. 37 Business-Type Activities - Enterprise Funds
Fresno
Convention
Center
Stadium
Other
Enterprise
Funds
Total
Internal
Service
Funds
Assets
Current Assets:
$ 1,942 $ 80 $ 2,767 $ 286,636 $ 131,346 Cash and Investments — 6 18 1,784 521 Interest Receivable
317 2,052 3,511 72,121 1,825 Accounts Receivables, Net — — — 6,434 — Grants Receivable
66 — — 7,634 1,073 Inventories
136 — — 1,371 562 Prepaid Items
— — — 8,064 — Intergovernmental Receivables
— — 909 21,066 2,844 Due from Other Funds
598 — — 598 — Restricted Cash and Investments
3,059 2,138 7,205 405,708 138,171 Total Current Assets Noncurrent Assets:
Restricted:
752 907 969 235,995 5,326 Cash and Investments
— — — 465 — Interest Receivable
752 907 969 236,460 5,326 Total Restricted Assets
Other Assets:
— — — 4,296 — Other Receivables
102 191 14 520 — Other Assets
— — 6,825 151,408 38,678 Net Pension Asset
— — — 822 — Unamortized CVP Water Settlement
— — — 10,258 — Solid Waste Rate Payers
— — — 16,321 — Advances to Other Funds, Net
102 191 6,839 183,625 38,678 Total Other Assets
Capital Assets:
4,163 710 12 72,764 — Land and Intangibles
86,632 43,489 3,743 1,504,918 12,526 Buildings, Systems and Improvements 309 2,783 67 102,762 147,710 Machinery and Equipment — — — 745,682 — Infrastructure
— — — 716 3,235 Right to Use Assets Being Amortized — 2,028 — 242,995 27,304 Construction in Progress
(73,393) (21,079) (2,287) (945,233) (93,347) Less Accumulated Depreciation 17,711 27,931 1,535 1,724,604 97,428 Total Capital Assets, Net 18,565 29,029 9,343 2,144,689 141,432 Total Noncurrent Assets 21,624 31,167 16,548 2,550,397 279,603 Total Assets Deferred Outflows of Resources
58 20 50 138 — Charge on Refunding
— — 392 8,669 2,403 Pension Contributions
— — 222 4,477 1,247 Deferred Outflows - Pension
17 — 416 8,546 2,346 Deferred Outflows - OPEB
$ 75 $ 20 $ 1,080 $ 21,830 $ 5,996 Total Deferred Outflows of Resources The notes to the financial statements are an integral part of this statement. 38 CITY OF FRESNO, CALIFORNIA
Statement of Net Position
Proprietary Funds
June 30, 2022 (continued)
(in thousands)
Business-Type Activities - Enterprise Funds
Water
System
Sewer
System
Solid Waste
Management Transit Airports
Liabilities
Current Liabilities:
Accrued Liabilities $ 6,313 $ 5,721 $ 1,356 $ 4,169 $ 5,403 Accrued Compensated Absences and HRA 306 388 313 693 385 Liability for Self-Insurance — — — — —
Unearned Revenue 7,597 12,907 — 33,796 —
Due to Other Funds 115 136 564 139 35
Bonds Payable — 885 — — 3,055
Accrued Closure Cost — — 800 — —
Capital Finance Obligations — — — — —
Notes Payable 11,604 1,013 — — —
Lease Liability — 18 — — 164
Total Current Liabilities 25,935 21,068 3,033 38,797 9,042 Noncurrent Liabilities
Accrued Compensated Absences and HRA 1,944 1,860 1,442 2,907 1,536 Capital Finance Obligations — — — — —
Liability for Self-Insurance — — — — —
Bonds Payable 90,329 — — — 72,405
Accreted Interest Payable on Capital
Appreciation Bonds — — — — —
Notes Payable 318,081 94,643 — — —
CVP Litigation Settlement 127 — — — —
Lease Liability — 174 — — 182
Pollution Remediation Obligation — — — — 406
Other Liabilities — 1,396 — — —
Accrued Closure Costs — — 10,374 — —
Advances from Other Funds — — 2,969 — —
Net OPEB Liability 4,845 4,601 3,115 9,735 2,360
Deposits Held for Others 1,094 12,351 — — 464
Total Noncurrent Liabilities 416,420 115,025 17,900 12,642 77,353 Total Liabilities 442,355 136,093 20,933 51,439 86,395 Deferred Inflows of Resources
Deferred Inflows - Pension 16,765 15,210 11,299 29,833 9,033 Deferred Inflows - OPEB 3,485 3,271 2,318 8,334 1,942 Deferred Inflows - Leases 3,024 2,784 — — 16,046
Total Deferred Inflows of Resources 23,274 21,265 13,617 38,167 27,021 Net Position
Net Investment in Capital Assets 304,288 538,298 8,622 101,128 132,426 Unrestricted (Deficit) 230,545 184,440 20,749 53,510 67,026 Total Net Position (Deficit) $ 534,833 $ 722,738 $ 29,371 $ 154,638 $ 199,452 The notes to the financial statements are an integral part of this statement. 39 Business-Type Activities - Enterprise Funds
Fresno
Convention
Center
Stadium
Other
Enterprise
Funds
Totals
Internal
Service
Funds
Liabilities
Current Liabilities:
$ 1,356 $ 836 $ 228 $ 25,382 $ 8,824 Accrued Liabilities — — 37 2,122 733 Accrued Compensated Absences and HRA — — — — 37,746 Liability for Self-Insurance
— — — 54,300 5,844 Unearned Revenue
— — 645 1,634 33,147 Due to Other Funds
3,037 1,870 60 8,907 — Bonds Payable
— — — 800 — Accrued Closure Cost
— — — — 6,925 Capital Lease Obligations
— — — 12,617 — Notes Payable
— — — 182 407 Lease Liability
4,393 2,706 970 105,944 93,626 Total Current Liabilities Noncurrent Liabilities
— — 327 10,016 5,246 Accrued Compensated Absences and HRA — — — — 29,843 Capital Lease Obligations
— — — — 170,181 Liability for Self-Insurance
11,140 20,674 1,488 196,036 — Bonds Payable
Accreted Interest Payable on Capital
3,078 — — 3,078 — Appreciation Bonds
— — — 412,724 — Notes Payable
— — — 127 — CVP Litigation Settlement
— — — 356 2,431 Lease Liability
— — — 406 — Pollution Remediation Obligation
— — — 1,396 — Other Liabilities
— — — 10,374 — Accrued Closure Costs
— — — 2,969 — Advances from Other Funds
69 — 1,158 25,883 3,798 Net OPEB Liability
409 — — 14,318 4,679 Deposits Held for Others
14,696 20,674 2,973 677,683 216,178 Total Noncurrent Liabilities 19,089 23,380 3,943 783,627 309,804 Total Liabilities Deferred Inflows of Resources
— — 3,809 85,949 23,695 Deferred Inflows - Pension
25 — 982 20,357 8,381 Deferred Inflows - OPEB
— 1,648 1,557 25,059 343 Deferred Inflows - Leases
25 1,648 6,348 131,365 32,419 Total Deferred Inflows of Resources Net Position
3,591 5,407 158 1,093,918 57,822 Net Investment in Capital Assets (1,006) 752 7,301 563,317 (114,446) Unrestricted (Deficit) $ 2,585 $ 6,159 $ 7,459 $ 1,657,235 $ (56,624) Total Net Position (Deficit) Some amounts reported for Business-Type Activities in
the Statement of Net Position are different due to certain Internal Service Fund assets and liabilities being
included with Business-Type Activities. (36,306)
Net position of Business-Type Activities $ 1,620,929
The notes to the financial statements are an integral part of this statement. 40 CITY OF FRESNO, CALIFORNIA
Statement of Revenues, Expenses and Changes in Fund Net Position Proprietary Funds
Fiscal Year Ended June 30, 2022
(in thousands)
Business-Type Activities - Enterprise Funds
Water
System
Sewer
System
Solid Waste
Management
Transit Airports
Operating Revenues:
Charges for Services $ 138,492 $ 87,795 $ 35,423 $ 11,242 $ 34,439 Operating Expenses:
Cost of Services 50,163 33,868 21,677 46,059 14,820 Administration 19,691 17,220 16,614 16,014 7,949
Amortization — 19 — — 165
Depreciation 29,525 25,024 531 7,592 11,709
Total Operating Expenses 99,379 76,131 38,822 69,665 34,643 Operating Income (Loss) 39,113 11,664 (3,399) (58,423) (204) Non-Operating Revenue (Expenses):
Operating Grants 192 — 206 62,915 7,959
Interest Income 2,091 1,731 223 276 970
Net Increase (Decrease) in Cash Fair Value (11,347) (9,674) (896) (3,660) (3,201) Interest Expense (11,137) (336) (48) — (5,114)
Other Financing Sources - Leases — — — — (224)
Passenger Facility Charges — — — — 4,234
Customer Facility Charges — — — — 2,211
Gain (Loss) on Disposal of Capital Assets — (685) — — — Total Non-Operating Revenue (Expenses) (20,201) (8,964) (515) 59,531 6,835 Income (Loss) Before Contributions & Transfers 18,912 2,700 (3,914) 1,108 6,631 Capital Contributions 328 4,042 — 10,253 3,221
Transfers In 1 1 1,594 — —
Transfers Out (1,473) (346) (1,033) (1,453) (268)
Change in Net Position 17,768 6,397 (3,353) 9,908 9,584 Total Net Position (Deficit) - Beginning Restated 517,065 716,341 32,724 144,730 189,868 Total Net Position (Deficit) - Ending $ 534,833 $ 722,738 $ 29,371 $ 154,638 $ 199,452 The notes to the financial statements are an integral part of this statement. 41 Business-Type Activities - Enterprise Funds
Fresno
Convention
Center Stadium
Other
Enterprise
Funds Totals
Internal
Service
Funds
Operating Revenues:
$ 5,744 $ 279 $ 11,335 $ 324,749 $ 195,712 Charges for Services Operating Expenses:
5,231 254 5,485 177,557 160,607 Cost of Services
1,156 172 3,033 81,849 34,447 Administration
— — — 184 — Amortization
2,023 1,275 188 77,867 14,145 Depreciation
8,410 1,701 8,706 337,457 209,199 Total Operating Expenses (2,666) (1,422) 2,629 (12,708) (13,487) Operating Income (Loss) Non-Operating Revenue (Expenses):
— — — 71,272 — Operating Grants
— 48 77 5,416 1,308 Interest Income
— (89) (168) (29,035) (5,243) Net Increase (Decrease) in Cash Fair Value (825) (1,224) (61) (18,745) (778) Interest Expense
— — — (224) — Other Financing Sources - Leases
— — — 4,234 — Passenger Facility Charges
— — — 2,211 — Customer Facility Charges
— — — (685) — Gain (Loss) on Disposal of Capital Assets (825) (1,265) (152) 34,444 (4,713) Total Non-Operating Revenue (Expenses) (3,491) (2,687) 2,477 21,736 (18,200) Income (Loss) Before Contributions & Transfers — 50 — 17,894 — Capital Contributions
6,122 3,694 1,300 12,712 4,130 Transfers In
— — (1,025) (5,598) (1,254) Transfers Out
2,631 1,057 2,752 46,744 (15,324) Change in Net Position (46) 5,102 4,707 (41,300) Total Net Position (Deficit) - Beginning Restated $ 2,585 $ 6,159 $ 7,459 $ (56,624) Total Net Position (Deficit) - Ending Some amounts reported for Business-Type
Activities in the Statement of Activities are
different due to the net revenue (expenses) of
certain Internal Service Funds being reported
with Business-Type Activities. (8,940)
Change in net position of Business-Type
Activities $ 37,804
The notes to the financial statements are an integral part of this statement. 42 CITY OF FRESNO, CALIFORNIA
Statement of Cash Flows
Proprietary Funds
Fiscal Year Ended June 30, 2022
(in thousands)
Business-Type Activities - Enterprise Funds
Water
System
Sewer
System
Solid Waste
Management
Transit Airports
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash Received from Customers $ 128,691 $ 82,806 $ 31,762 $ 11,607 $ 34,786 Cash Received from Interfund Services Provided 205 71 69 — — Cash Payments (to) from Suppliers for Services (41,652) (29,993) (11,160) (18,169) (8,900) Cash Paid for Interfund Services Used (10,636) (8,841) (15,840) (7,226) (3,448) Cash Payments to Employees for Services (19,244) (17,302) (15,426) (45,273) (12,139) Cash Payments for Claims and Refunds — — — — —
Net Cash Provided by (Used for) Operating Activities 57,364 26,741 (10,595) (59,061) 10,299
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:
Capital Contributions 328 5,880 — 10,089 3,568
Passenger and Customer Facility Charges 6,445
Interest Payments on Capital Debt (11,050) (268) (47) — (3,465) Proceeds from Issuance of Capital Debt 4,530 8,798 — — — Payment for Cost of Issuance — — — — —
Principal Payments on Capital Debt-Bonds — — — — (2,885) Principal Payments on Capital Debt-Notes (11,537) (1,003) — — — Principal Payments on Capital Lease Obligations — — — — — Proceeds (Loss) from Sale of Capital Assets — 24,826 — — (241) Acquisition and Construction of Capital Assets (12,182) (35,451) (125) (9,426) (15,486) Net Cash Provided by (Used for) Capital and Related
Financing Activities (29,911) 2,782 (172) 663 (12,064)
CASH FLOWS FROM NON-CAPITAL FINANCING
ACTIVITIES:
Operating Grants 192 — 206 107,456 9,000
Borrowing Receipt from (Payment to) Other Funds — — — — — Change in Accounting Estimate — (10) — — —
Transfers In 1 1 1,594 — —
Transfers Out (1,473) (346) (1,033) (1,453) (268)
Net Cash Provided by (Used for) Non-Capital
Financing Activities (1,280) (355) 767 106,003 8,732 CASH FLOWS FROM INVESTING ACTIVITIES:
Interest and Dividends Received (Paid) on Investments (9,303) (8,025) (624) (3,484) (2,279) Net Cash Provided by (Used for) Investing Activities (9,303) (8,025) (624) (3,484) (2,279) Net Increase (Decrease) in Cash and Cash Equivalents 16,870 21,143 (10,624) 44,121 4,688 Cash and Cash Equivalents, Beginning of Year 180,261 147,828 23,081 25,381 62,465 Cash and Cash Equivalents, End of Year $ 197,131 $ 168,971 $ 12,457 $ 69,502 $ 67,153 The notes to the financial statements are an integral part of this statement. 43 Business-Type Activities - Enterprise Funds
Fresno
Convention
Center
Stadium
Other
Enterprise
Funds
Totals
Internal
Service
Funds
CASH FLOWS FROM OPERATING ACTIVITIES:
$ 3,741 $ 344 $ 10,707 $ 304,444 $ 113,684 Cash Received from Customers — — — 345 144,337 Cash Received from Interfund Services Provided (3,141) (679) (2,792) (116,486) (44,601) Cash Payments (to) from Suppliers for Services — — (2,059) (48,050) (20,865) Cash Paid for Interfund Services Used (2,939) — (5,084) (117,407) (37,330) Cash Payments to Employees for Services — — — — (119,279) Cash Payments for Claims and Refunds (2,339) (335) 772 22,846 35,946 Net Cash Provided by (Used for) Operating Activities
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:
1,235 50 — 21,150 19,071 Capital Contributions
— 6,445 — Passenger and Customer Facility Charges
(1,380) (1,443) (78) (17,731) (631) Interest Payments on Capital Debt — — — 13,328 — Proceeds from Issuance of Capital Debt — — 5 5 — Payment for Cost of Issuance
(3,784) (1,770) (55) (8,494) — Principal Payments on Capital Debt-Bonds — — — (12,540) — Principal payments on Capital Debt-Notes — — — — (6,276) Principal Payments on Capital Lease Obligations — — — 24,585 — Proceeds from Sale of Capital Assets — (2,367) (53) (75,090) (22,962) Acquisition and Construction of Capital Assets (3,929) (5,530) (181) (48,342) (10,798)
Net Cash Provided by (Used for) Capital and Related
Financing Activities
CASH FLOWS FROM NON-CAPITAL FINANCING
ACTIVITIES:
— — 116,854 — Operating Grants
— (512) (512) 4,506 Borrowing Receipt from (Payment to) Other Funds — — — (10) — Change in Accounting Estimate
6,122 3,694 1,300 12,712 4,130 Transfers In
— — (1,025) (5,598) (1,254) Transfers Out
6,122 3,694 (237) 123,446 7,382
Net Cash Provided by (Used for) Non-Capital
Financing Activities
CASH FLOWS FROM INVESTING ACTIVITIES:
— (31) (93) (23,839) (3,978) Interest and Dividends Received (Paid) on Investments — (31) (93) (23,839) (3,978) Net Cash Provided by (Used for) Investing Activities (146) (2,202) 261 74,111 28,552 Net Increase (Decrease) in Cash and Cash Equivalents 3,438 3,189 3,475 449,118 108,120 Cash and Cash Equivalents, Beginning of Year $ 3,292 $ 987 $ 3,736 $ 523,229 $ 136,672 Cash and Cash Equivalents, End of Year (Continued)
The notes to the financial statements are an integral part of this statement. 44 CITY OF FRESNO, CALIFORNIA
Statement of Cash Flows
Proprietary Funds
Fiscal Year Ended June 30, 2022 (Continued)
(in thousands)
Business-Type Activities - Enterprise Funds
Water
System
Sewer
System
Solid Waste
Management
Transit Airports
Reconciliation of Operating Income (Loss) to Net Cash
Provided by (Used for) Operating Activities:
Operating income (loss) $ 39,113 $ 11,664 $ (3,399) $ (58,423) $ (204) Adjustment to reconcile operating income (loss) to net cash provided by (used for) operating activities:
Depreciation expense 29,525 25,024 531 7,592 11,709 Amortization Expense — 19 — — 165
Change in assets and liabilities:
Decrease (increase) in accounts receivable (3,687) (4,274) (641) 165 (15,088) Decrease (increase) in other receivables 21 2,752 914 — — Decrease (increase) in due from other funds (9,816) (6,713) (3,024) (160) (443) Decrease (increase) in due from other governments — (46) — (11,934) — Decrease (increase) in material and supplies inventory 134 (111) — (86) (21) Decrease (increase) in prepaid items 383 59 34 (22) 191 Decrease (increase) in net pension asset & deferred outflows (20,995) (19,183) (14,227) (37,501) (11,220) Decrease (increase) in advances to other funds 946 1,115 (742) — — Decrease (increase) in prepaid insurance — 9 — — 18 (Decrease) increase in accounts payable 2,346 1,279 7 (175) 188 (Decrease) increase in salaries payable 97 266 298 829 173 (Decrease) increase in due to other funds (205) (158) (534) (69) (51) (Decrease) increase in other liabilities — (2,689) — — — (Decrease) increase in retention payable — — — (47) 60 (Decrease) increase in accrued closure costs (929)
(Decrease) increase in unearned revenue — — — 11,497 — (Decrease) increase in liability for self-insurance
(Decrease) increase in deposits — — — — 8
(Decrease) increase in pollution remediation liability (45) (Decrease) increase in net OPEB liability (2,486) (2,332) (1,666) (6,116) (1,417) (Decrease) increase in deferred inflows of resources 21,988 20,060 12,783 35,389 26,276 Net Cash Provided by (Used For) Operating Activities $ 57,364 $ 26,741 $ (10,595) $ (59,061) $ 10,299 Reconciliation of Cash and Cash Equivalents to the
Statement of Net Position:
Cash and Investments:
Unrestricted $ 129,493 $ 105,566 $ 2,250 $ 15,698 $ 28,840 Restricted - Current and Noncurrent 67,638 63,405 10,207 53,804 38,313 Cash and Cash Equivalents at End of Year on Statement
of Cash Flows $ 197,131 $ 168,971 $ 12,457 $ 69,502 $ 67,153 Noncash Investing, Capital, and Financing Activities:
Acquisition/construction of capital assets on accounts payable $ 1,036 $ 2,632 $ 49 $ 988 $ 1,756 Amortization of bond premium, discount and loss on refunding 88 — — — (39) Borrowing under capital financing — — — — —
Decrease (increase) in fair value of investments (9,100) (7,830) (597) (3,331) (2,643) Decrease in unamortized CVP water settlement receivable and decrease in CVP litigation settlement payable (127) The notes to the financial statements are an integral part of this statement. 45 Business-Type Activities - Enterprise Funds
Fresno
Convention
Center
Stadium
Other
Enterprise
Funds
Totals
Internal
Service
Funds
Reconciliation of Operating Income (Loss) to Net Cash
Provided by (Used for) Operating Activities:
$ (2,666) $ (1,422) $ 2,629 $ (12,708) $ (13,487) Operating income (loss) Adjustment to reconcile operating income (loss) to net cash provided by (used for) operating activities:
2,023 1,275 188 77,867 14,145 Depreciation expense
— — — 184 — Amortization expense
Change in assets and liabilities:
1,042 (1,584) (1,767) (25,834) (173) Decrease (increase) in accounts receivable — — — 3,687 — Decrease (increase) in other receivables — — (910) (21,066) 1,315 Decrease (increase) in due from other funds — — — (11,980) — Decrease (increase) in due from other governments (35) — — (119) (186) Decrease (increase) in material and supplies inventory 15 — 6 666 22 Decrease (increase) in prepaid items
4 — (4,774) (107,896) (29,686) Decrease (increase) in net pension asset & deferred outflows — 21 — 1,340 — Decrease (increase) in advances to other funds — — 1 28 — Decrease (increase) in prepaid insurance 334 (273) (202) 3,504 (2,153) (Decrease) increase in accounts payable (28) — (112) 1,523 765 (Decrease) increase in salaries payable — — 421 (596) 21,396 (Decrease) increase in due to other funds — — — (2,689) — (Decrease) increase in other liabilities — — — 13 — (Decrease) increase in retention payable — (929) — (Decrease) increase in accrued closure costs (23) — — 11,474 4,290 (Decrease) increase in unearned revenue — — 15,694 (Decrease) increase in liability for self-insurance (3,002) — — (2,994) 195 (Decrease) increase in deposits — (45) — (Decrease) increase in pollution remediation liability (15) — (717) (14,749) (6,761) (Decrease) increase in net OPEB liability 12 1,648 6,009 124,165 30,570 (Decrease) increase in deferred inflows of resources $ (2,339) $ (335) $ 772 $ 22,846 $ 35,946 Net Cash Provided by (Used For) Operating Activities Reconciliation of Cash and Cash Equivalents to the
Statement of Net Position:
Cash and Investments:
$ 1,942 $ 80 $ 2,767 $ 286,636 $ 131,346 Unrestricted
1,350 907 969 236,593 5,326 Restricted - Current and Noncurrent Cash and Cash Equivalents at End of Year on Statement
$ 3,292 $ 987 $ 3,736 $ 523,229 $ 136,672 of Cash Flows Noncash Investing, Capital, and Financing Activities:
$ — $ 578 $ — $ 7,039 $ 2,899 Acquisition/construction of capital assets on accounts payable (260) (207) (16) (434) — Amortization of bond premium, discount and loss on refunding — — — — 20,827 Borrowing under capital financing
— (47) (133) (23,681) (4,283) Decrease (increase) in fair value of investments — (127) —
Decrease in unamortized CVP water settlement receivable and decrease in CVP litigation settlement payable
The notes to the financial statements are an integral part of this statement. 46 CITY OF FRESNO, CALIFORNIA
Statement of Fiduciary Net Position
Fiduciary Funds - Trust and Custodial Funds
June 30, 2022
(in thousands)
Pension
Trust Funds
Successor Agency
to the Fresno
Redevelopment
Agency Private-
Purpose Trust Fund
Custodial
Funds
Assets
Cash and Investments $ 1,968 $ 3,182 $ 3,300
Restricted Cash and Investments Held by Fiscal Agent — 443 554 Total Cash and Investments 1,968 3,625 3,854
Receivables:
Receivables for Investments Sold 28,983 — —
Interest and Dividends Receivable 5,598 — 9
Other Receivables 2,339 47 —
Due from Other Governments — — 379
Total Receivables 36,920 47 388
Investments, at Fair Value:
Short-Term Investments 13,112 — —
Domestic Equity 1,055,209 — —
Corporate Bonds 371,511 — —
International Developed Market Equities 443,289 — —
Government Bonds 205,016 — —
Alternatives 848,560 — —
Real Estate 532,153 — —
Total Investments 3,468,850 — —
Collateral Held for Securities Lent 131,286 — —
Capital Assets, Net of Accumulated Depreciation 964 — — Other Assets 312 — —
Property Held for Resale — 293 —
Total Assets 3,640,300 3,965 4,242
Deferred Outflows of Resources
Charge on Refunding — 2 —
Pension Contributions — 109 —
Total Deferred Outflows of Resources — 111 —
Liabilities
Accrued Liabilities 52,128 181 20
Collateral Held for Securities Lent 131,286 — —
Due To Other Funds 103
Due to Other Governments — — 3
Other Liabilities 3,623 — —
Long-Term Debt:
Due Within One Year — 512 —
Due in More than One Year — 1,098 —
Advances From Other Funds (Due to City of Fresno) — 6,848 — Net Pension Liability — 318 —
Total Liabilities 187,037 8,957 126
Deferred Inflows of Resources
Unamortized Pension Expense — 335 —
Net Position
Restricted for Pension Benefits 3,453,263 — —
Restricted for Individuals, Organizations, and Other
Governments 4,116
Held in Trust for Redevelopment Dissolution — (5,216) — Total Net Position $ 3,453,263 $ (5,216) $ 4,116
The notes to the financial statements are an integral part of this statement. 47 CITY OF FRESNO, CALIFORNIA
Statement of Changes in Fiduciary Net Position
Fiduciary Funds - Trust Funds
Fiscal Year Ended June 30, 2022
(in thousands)
Pension
Trust Funds
Successor Agency
to the Fresno
Redevelopment
Agency Private-
Purpose Trust Fund
Custodial
Funds
Additions
Contributions:
Employer $ 49,573 $ — $ —
System Members 26,466 — —
Total Contributions 76,039 — —
Investment Income:
Net Appreciation in Fair Value of Investments (305,756) — — Interest 18,399 — 23
Dividends 30,943 — —
Other Investment Related 124 — —
Total Investment Income (256,290) — 23
Less Investment Expense (37,447) — —
Total Net Investment Income (293,737) — 23
Securities Lending Income:
Securities Lending Earnings 884 — —
Less Securities Lending Expense (291) — —
Net Securities Lending Income 593 — —
Property Taxes — 3,365
Taxes Collected for Organizations and Other
Governments 701
Fees Collected for Organizations and Other
Governments 4,744
Other Income — 43 —
Total Additions (217,105) 3,408 5,468
Deductions
Benefit Payments (including post retirement
supplemental benefits) 145,049 — —
Refund of Contributions 2,014 — —
Redevelopment Expenses — 167 —
General and Administrative Expenses 4,176 304 —
Deposits Held for Others — — 4,883
Principal on Debt 270
Interest on Debt — 193 167
Total Deductions 151,239 664 5,320
Change in Net Position (368,344) 2,744 148
Net Position - Beginning, Restated 3,821,607 (7,960) 3,968 Net Position - Ending $ 3,453,263 $ (5,216) $ 4,116
The notes to the financial statements are an integral part of this statement. 48 This page intentionally left blank
49 Note 1. Summary of Significant Accounting Policies
The financial statements of the City of Fresno (City) have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), as applied to governmental agencies. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.
The more significant accounting policies of the City are described below.
A. Reporting Entity
The City is a political subdivision chartered by the State of California and, as such, can exercise the powers specified by the Constitution and laws of the State of California. The City operates under its own Charter and is governed by a directly elected strong Mayor and a seven-member City Council (Council). The City Manager serves as the head of the administrative branch of the City and is appointed by the Mayor.
As required by GAAP, these basic financial statements present the financial status of the City (the primary government) and its component units (entities for which the City is considered to be financially accountable). The blended component units, although legally separate entities, are substantially part of the City's operations. Thus, data from these units are combined with data of the primary government.
As a government agency, the City is exempt from both federal income taxes and state franchise taxes.
B. Government-Wide and Fund Financial Statements
The Government-Wide Financial Statements (the Statement of Net Position and the Statement of Activities) report information on all of the non-fiduciary activities of the primary government and its blended component units. For the most part, the effect of interfund activity has been removed from these statements. Interfund services provided and used are not eliminated in the consolidation process. Governmental Activities, which normally are supported by taxes and inter-governmental revenues, are reported separately from Business-Type Activities, which rely to a significant extent on fees and charges for support.
The Statement of Activities demonstrates the degree to which the clearly identifiable direct expenses of a given function or segment is offset by program revenues. Program revenues include (1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and (2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not included among program revenues are reported instead as general revenues. The accounts of the City are organized on the basis of funds. A fund is a separate accounting entity with a self- balancing set of accounts. Each fund was established for the purpose of accounting for specific activities in accordance with applicable regulations, restrictions, or limitations. Separate financial CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 50 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES statements are provided for governmental funds, proprietary funds, and fiduciary funds (though the latter are excluded from the Government-Wide Financial Statements). Major individual governmental funds and major individual enterprise funds are reported by separate columns in the Fund Financial Statements.
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation The Government-Wide, Proprietary Fund, and Trust Fund Financial Statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied.
Grants and similar items are recognized as revenue as soon as all eligibility requirements have been met. Proprietary Funds distinguish operating revenues and expenses from non-operating items.
Operating revenues and expenses generally result from providing services in connection with the fund’s principal, ongoing operations. The principal operating revenues of the City’s enterprise and internal service funds are charges to customers for sales and for services. Operating expenses for enterprise funds and internal service funds include the cost of services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses.
Custodial Fund Financial Statements use the accrual basis of accounting and a measurement focus on the periodic determination of additions, deductions, and net position restricted for benefits.
Governmental Fund Financial Statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period.
The City considers property tax revenues, local taxes, licenses, interest, and other intergovernmental revenues to be available if they are collected within 60 days of the end of the current fiscal period.
All other revenue items are considered to be measurable and available only when the City receives cash. Expenditures generally are recorded when a liability is incurred. However, debt service, vacation, sick leave, claims and judgments expenditures are recorded only when payment is due.
The City reports on the following major governmental funds, proprietary (enterprise) funds, and fiduciary funds:
1. Major Governmental Funds
General Fund is the City’s primary operating fund. It accounts for all financial resources of the City except those required to be accounted for in another fund.
Grants Special Revenue Fund accounts for grants received from federal, state, and other agencies, which are to be used for various purposes identified within the confines of the individual grant.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 51 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
2. Major Proprietary (Enterprise) Funds
Water System Fund accounts for the construction, operation, and maintenance of the City's water distribution system. Revenues are derived from water service fees and various installation charges.
Sewer System Fund accounts for the construction, operation, and maintenance of the City's sewer system. Revenues are derived from sewer service fees and various installation charges.
Solid Waste Management Fund accounts for the operations of the City's residential solid waste disposal service. Revenues are primarily derived from solid waste service fees.
Transit Fund accounts for the operation and maintenance of the City's mass transportation service. Primary revenue sources are rider fares, federal grants, and state operating grants.
Airports Fund accounts for the City's two airport operations. Revenues are primarily derived from fees and rents.
Fresno Convention Center Fund accounts for the operation and maintenance of the City's convention center. Revenues are primarily derived from fees charged for using the facilities, supplemented by General Fund support.
Stadium Fund accounts for the construction, operation and maintenance of the City’s baseball stadium. Revenues are derived from the leasing of the facilities, supplemented by General Fund support.
3. Nonmajor Governmental Funds
Nonmajor Special Revenue Funds are used to account for the proceeds of revenue sources that are restricted or committed to expenditure for specified purposes other than debt service and capital projects. Funds listed under Special Revenue Funds include High Speed Rail Fund, Fresno Revitalization Corporation Fund, Special Gas Tax Fund, Measure C Fund, Community Services Fund, Urban Growth Management (UGM) Impact Fees Fund, Low and Moderate Income Housing Fund, and Special Assessments Fund.
Debt Service Funds are used to account for and report financial resources that are restricted, committed, or assigned to expenditures for principal and interest. Numbers for City debt and Financing Authorities/Corporations debt are presented in separate columns on the financial statements.
Capital Projects Funds are used to account for and report financial resources that are restricted, committed, or assigned to expenditure for capital outlays.
4. Nonmajor Proprietary Funds
Nonmajor Enterprise Funds account for operations that are financed and operated in a manner similar to private business enterprises. Costs are financed or recovered primarily through user charges. Funds listed under Nonmajor Enterprise Funds include Community Sanitation Fund and Parks and Recreation Fund.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 52 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Internal Service Funds account for the financing of goods or services provided by one City department to another City department on a cost reimbursement basis. The General Services Fund accounts for the activities of the equipment maintenance services, centralized telecommunications, information services, and central printing. The Risk Management Fund accounts for the City’s self-insurance, including provision for losses on property, liability, workers’ compensation, and unemployment compensation. The Billing and Collection Fund accounts for the billing, collecting, and servicing activities for the Water System, Sewer System, Solid Waste Management, and Community Sanitation Funds.
The Employees’ Healthcare Plan Fund and the Retirees’ Healthcare Plan Fund account for the assets held on behalf of the City of Fresno Employees’ Healthcare Plan for claim payments on behalf of qualified employees and retirees. While there is only one plan, there is separate accounting for active employees and retirees. There are no standalone financial reports issued for either Healthcare Plan Fund.
5. Fiduciary Funds
Fiduciary Funds are used to account for resources held for the benefit of parties outside the government. Fiduciary Funds are not reflected in the Government-Wide Financial Statements because the resources of those funds are not available to support the City’s own programs. The accounting used for fiduciary funds is much like that used for other Proprietary Funds.
The City Departmental and Special Purpose Fund account for City-related trust activity, such as fees collected for other entities. The Special Assessments District Fund accounts for the receipts and disbursements for the debt service activity of bonded assessment districts within the City.
Custodial Funds use the economic resources measurement focus.
When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, then unrestricted resources as they are needed.
Pension Trust Funds account for the assets held on behalf of the City of Fresno Fire and Police Retirement System and the City of Fresno Employees Retirement System for pension benefit payments to qualified employees and retirees. Pension Trust Funds are accounted for in essentially the same manner as other Proprietary Funds. • City of Fresno Fire and Police Retirement System (Fire and Police): Fire and Police was established on July 1, 1955, to provide benefits to the public safety employees and retirees of the City. Fire and Police is maintained and governed by Articles 3 and 4 of Chapter 3 of the Fresno Municipal Code. Fire and Police responsibilities include: administration of the trust fund; delivery of retirement, death and disability benefits to eligible members; administration of programs; and general assistance in retirement and related benefits. The governing board is made up of two members appointed by the Mayor, an elected police member, an elected fire member and a board-appointed member.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 53 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The activity for Fire and Police is reflected within Fiduciary Funds. Separate financial statements are prepared for the Fire and Police Retirement System and may be obtained from the Retirement Office at 2828 Fresno Street, Fresno, CA 93721-3604 or at https:// www.cfrs-ca.org/fire-and-police-retirement-system/financial/. • City of Fresno Employees Retirement System (Employees): Employees was established on June 1, 1939, to provide benefits to the general employees and retirees of the City.
Employees is governed by Article 5 of Chapter 3 of the Fresno Municipal Code. Employees responsibilities include: administration of the trust fund; delivery of retirement, disability, and death benefits to eligible members; administration of programs; and general assistance in retirement and related benefits. The governing board is made up of two Mayor- appointed members, two elected members and one board-appointed member. The activity for Employees is reflected within Fiduciary Funds. Separate financial statements are prepared for the Employees Retirement System and may be obtained from the Retirement Office at 2828 Fresno Street, Fresno, CA 93721-3604, or at https://www.cfrs-ca.org/ employee-retirement-system/ers-financial/.
Private-Purpose Trust Funds account for the custodial responsibilities that are assigned to the Successor Agency to the Redevelopment Agency with the passage of the Redevelopment Dissolution Act.
Custodial Funds account for assets held by the City in a custodial capacity on behalf of individuals or other governmental units.
6. Component Units
In addition to the primary governmental unit, the City also has several component units whose functions are described below:
a. Blended Component Units
Although the following component units are legally separate from the City, the component units have been "blended" into the City's basic financial statements for financial reporting purposes because the governing board is substantially the same as the City Council, there is a financial benefit/burden relationship between the component unit and the City, or City management has the operational responsibility for the component unit. In addition, the component unit provides services exclusively to the primary government or the component unit’s total debt outstanding is expected to be repaid with resources of the primary government.
All potential component units were evaluated, resulting in the inclusion of the following entities in the basic financial statements.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 54 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Fresno Joint Powers Financing Authority (Authority): The Authority, an independent public entity created in 1988, acquires telecommunications equipment, office furniture, and streetlights; constructs facilities; and installs street improvements through the issuance of limited obligation bonds, certificates of participation and revenue bonds. The Authority currently is leasing these assets to the City. The Authority’s three member governing board, consisting of the Mayor and two Council Members, is responsible for the Authority’s fiscal and administrative decisions. The financial activity for the Authority is included in the Financing Authorities and Corporations Debt Service Fund. All lease obligations between the Authority and the City have been eliminated in the financial statements. The Authority does not issue separate financial statements.
City of Fresno Employees Healthcare Plan: This component unit provides healthcare to City employees not represented by the Stationary Engineers Local and retired employees who elect to be covered or are covered by the Fresno City Employees Health and Welfare Trusts (Trusts). The Trusts are self-insured trusts administered by an outside third party administrator. The activity for the Trusts is reflected within Internal Service Funds.
Fresno Revitalization Corporation: The Fresno Revitalization Corporation (FRC) is a non-profit public benefit corporation created in 1995 for the purpose of developing a revitalization policy and assisting with the downtown Fresno area development, redevelopment and renewal. The organization received a substantial portion of its support from the former Redevelopment Agency (RDA) and the general public. The seven Council Members of the City and the Mayor became members of the FRC’s Governing Board on January 26, 2012.
FRC Canyon Crest, LLC: FRC Canyon Crest, LLC is a special purpose limited liability company owned by the FRC. The purpose of FRC Canyon Crest, LLC was to acquire, operate, maintain, and rehabilitate a 118-unit low income multi-family complex. The complex was owned by a lender in Chicago as a result of a foreclosure of the previous owner. On March 4, 2010, the City Council approved the award of $2.7 million in Neighborhood Stabilization Program (NSP) set aside funds to the FRC to acquire the property. FRC Canyon Crest, LLC acquired the property, while the RDA guaranteed the loan from the seller. The RDA also provided administrative, financial, and technical support to FRC Canyon Crest, LLC in the acquisition and operation of the property through a contractual services agreement. The Agency Loan Guarantee and Operating Agreement also contained a Declaration of Restrictions creating the affordability covenants and long-term maintenance and operating restrictions, which were recorded against and run with the property.
The RDA and FRC Canyon Crest, LLC marketed the property for sale upon rehabilitation and stabilization to a qualified affordable housing developer for ongoing management and property improvements. In September 2011, the FRC and FRC Canyon Crest, LLC entered into an Assignment/Assumption Agreement with a developer as required by the U.S. Department of Housing and Urban Development (HUD). Final purchase of the property by the developer occurred on April 2012. However, the FRC and FRC Canyon Crest, LLC still hold a $500,000 residual receipts note on the property.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 55 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES As the City is the sole member of FRC Canyon Crest, LLC, the seven City Council members and the Mayor are Board members of FRC Canyon Crest, LLC, the activities of FRC Canyon Crest, LLC are blended into the FRC (and, by extension, the City) because: (1) its governing board is substantially the same as the City Council; (2) it provides services exclusively or almost exclusively for the benefit of the City even though it does not provide services directly to the City; and (3) the City is financially accountable for FRC Canyon Crest, LLC.
Fresno Enhanced Infrastructure Financing District (Fresno EIFD): On September 17, 2020, the Fresno City Council approved the creation of the Fresno EIFD. The Fresno EIFD is intended to serve as a catalyst for private sector investment and critical infrastructure in the City’s Downtown Planning Area and the southern portion of the Blackstone Avenue Bus Rapid Transit (BRT) Corridor as characterized in the City General Plan. The Fresno EIFD encompasses approximately 4,237 acres of land, representing approximately 5.8% of the City’s total (approximately) 73,400 acres. The Fresno EIFD obtains its funding through property tax increment that is generated above the base fiscal year (2021) amount of property tax. The Fresno EIFD intends to utilize the tax increment revenue stream to issue bonds that will fund approximately $100 million (present value dollars) in multi-modal transportation, mobility, and related improvements, including but not limited to the following:
• Safety and accessibility improvements for car, bicycle, and pedestrian travel modes. • Roadway and bus infrastructure investments.
• Streetscape, urban greening, and lighting enhancements. • Improved gateway and wayfinding signage.
The Fresno EIFD is governed by a five member board, which is made up of three City councilmembers and two appointed members of the public that live within the Fresno EIFD.
While there are no financial results from the Fresno EIFD in the Fiscal Year 2022 Annual Comprehensive Financial Report (ACFR), there will be results in future fiscal years as the district receives tax increment, issues bonds, and completes projects. The Fresno EIFD will be reported as a Debt Service Fund.
b. Fiduciary Component Unit
Successor Agency to the Redevelopment Agency of the City of Fresno (Successor Agency): The Successor Agency was created to serve as custodian for the assets and to wind down the affairs of the former RDA. The Governing Board of the Successor Agency consists of the City Council. Over the Successor Agency's Governing Board is the Countywide Oversight Board, which replaced the fifteen oversight boards previously created by successor agencies in Fresno County. Fresno County Oversight Board is comprised of six-member representatives:
a representative from the County Board of Supervisors, a representative from the cities within Fresno County, a representative from the independent special district within Fresno County, a representative from the County Office of Education, a representative of the California Community College districts in Fresno County, and a resident of Fresno County.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 56 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES In general, the Successor Agency’s assets can only be used to pay enforceable obligations in existence at the date of dissolution (including the completion of any unfinished projects that were subject to legally enforceable contractual commitments). In future fiscal years, the Successor Agency will only be allocated revenue in the amount that is necessary to pay the estimated annual installment payments on enforceable obligations of the former RDA until all of those enforceable obligations have been paid in full and all assets have been liquidated.
The City became the Housing Successor Agency and has the sole legal authority to administer the former RDA’s housing assets. The City may move forward with completing projects under contract at the time of the dissolution and liquidate surplus real estate for the purpose of distributing proceeds to taxing entities, pursuant to approval of repayment of the RDA's obligations to the City.
The Successor Agency is a separate legal entity under Assembly Bill (AB) 1484. The Successor Agency is reported as a Private-Purpose Trust Fund in the City’s financial statements. This means that the Successor Agency’s assets are considered to be held in a trustee or agency capacity for others and cannot be used to support the City’s government’s own programs. The housing activity of the former RDA is presented within the Low and Moderate Income Housing Fund, a special revenue fund.
Separate financial statements are prepared for the Successor Agency and can be obtained from the Successor Agency Office at 2344 Tulare Street, Suite 200, Fresno, CA 93721. There is no separate financial report prepared for the Housing Successor Agency.
D. Budgetary Data
The budget of the City is a detailed operating plan which identifies estimated costs and results in relation to estimated revenues. The budget includes (1) programs, projects, services, and activities to be provided during the fiscal year, (2) the estimated resources (inflow) and amounts available for appropriation, and (3) the estimated charges to appropriations. The budget represents a process through which policy decisions are made, implemented, and controlled. The City Charter prohibits expending funds for which there is no legal appropriation.
1. Fund Structure
The budget document is organized to reflect the fund structure of the City’s finances. Fund revenues and expenditures are rolled up to the various object levels by division and department for presentation of information to the public. Budget adoption and subsequent administration is carried out on a fund basis.
2. Basis of Accounting
The City adopts annual budgets for most governmental and business-type funds (except Financing Authorities/Corporations and City Debt Service) on the cash basis of accounting plus CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 57 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES encumbrances. Major General Fund revenues, such as sales tax and property tax, are budgeted on the modified accrual basis of accounting. Supplemental appropriations during the year must be approved by the City Council. Budgeted amounts are reported as amended.
Encumbrances are commitments related to executed contracts for goods or services.
Encumbrance accounting is utilized for budgetary control and accountability and to facilitate cash planning and control. Encumbrances outstanding at year-end are reported as part of restricted, committed, or assigned fund balance. As of June 30, 2022 , encumbrances totaled $19.2 million in the General Fund, $53.1 million in the Grants Special Revenue Fund, and $51.8 million in the Non major Governmental Funds.
3. Revenue Estimation
The methodology for calculating revenue estimates varies depending on the source of revenue. Considerable weight generally has been given to historical trends. This emphasis on historical trends is used because of the composition of the Fresno economy, which differs from California in general.
The General Fund is the City’s most versatile funding source, since it has the fewest restrictions. Its revenue comes from property and sales taxes, business tax fees, room tax (Transient Occupancy Tax), charges for services, development fees, and revenues from other governmental agencies. Property tax is the largest revenue source in the General Fund. The main source for projecting this revenue is assessed value information received from the County of Fresno.
Revenue estimates for Enterprise and Internal Service Funds are also rooted in historical trends. As those funds are generally self-supporting (meaning, they do not generally receive tax dollars to cover operational costs), revenue estimates also take into account any adjustments to fees assessed by the Enterprise or the Internal Service Funds. Additionally, any anticipated changes in service levels are also reflected in the revenue estimates.
4. Budget Administration
The budget establishes appropriation and expenditure levels. Expenditures may be below budgeted amounts at year-end due to unanticipated or mandated savings. The existence of a particular appropriation in the budget does not automatically mean funds are expended.
Because of the time span between preparing the budget and the subsequent adoption by the governing body, actual expenditures are likely to be different than the budgeted amounts.
Each expenditure is reviewed prior to any disbursement. These expenditure review procedures assure compliance with the City’s requirements and provide some degree of flexibility for modifying programs to meet changing needs and priorities.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 58 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES E. New Accounting Pronouncements - Implemented
1. GASB Statement No. 87 - Leases
The objective of GASB Statement No. 87 is to better meet the informational needs of financial statement users by improving accounting and financial reporting for leases by governments.
This statement increases the usefulness of governments’ financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract. It also establishes a single model for lease accounting based on the foundational principle that leases are financings of the right to use an underlying asset. Implementation of this Statement had a significant effect on the City’s financial statements for the year ended June 30, 2022.
2. GASB Statement No. 89 - Accounting for Interest Cost Incurred Before the End of a Construction Period
Under this GASB Statement, the City will no longer book capitalized interest with respect to construction cost and said interest will no longer be capitalized as part of the assets implementation costs. This statement is effective for reporting periods beginning after December 15, 2020 (was originally December 15, 2019), which for the City is June 30, 2022. The City early implemented GASB Statement No. 89 in fiscal year 2019.
3. GASB Statement No. 92 - Omnibus 2020
The primary objectives of this Statement are to enhance comparability in accounting and financial reporting and to improve consistency of authoritative literature by addressing practice issues that have been identified during implementation and application of certain GASB Statements. Application of this statement did not have a material effect on the City’s financial statements for the fiscal year ending June 30, 2022.
4. GASB Statement No. 93 - Replacement of Interbank Offered Rates Some governments have entered into agreements in which variable payments made or received depend on an interbank offered rate (IBOR)—most notably, the London Interbank Offered Rate (LIBOR). As a result of global reference rate reform, LIBOR is expected to cease to exist in its current form at the end of 2021, prompting governments to amend or replace financial instruments for the purpose of replacing LIBOR with other reference rates, by either changing the reference rate or adding or changing fallback provisions related to the reference rate. The objective of this Statement is to address those and other accounting and financial reporting implications that result from the replacement of an IBOR. Application of this statement did not have a material effect on the City’s financial statements for the fiscal year ending June 30, 2022.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 59 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
5. GASB Statement No. 97 - Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans – An Amendment of GASB Statements No. 14 and No. 84, and a Supersession of GASB Statement No. 32
The primary objectives of this Statement are to (1) increase consistency and comparability related to the reporting of fiduciary component units in circumstances in which a potential component unit does not have a governing board and the primary government performs the duties that a governing board typically would perform; (2) mitigate costs associated with the reporting of certain defined contribution pension plans, defined contribution other postemployment benefit (OPEB) plans, and employee benefit plans other than pension plans or OPEB plans (other employee benefit plans) as fiduciary component units in fiduciary fund financial statements; and (3) enhance the relevance, consistency, and comparability of the accounting and financial reporting for Internal Revenue Code (IRC) Section 457 deferred compensation plans (Section 457 plans) that meet the definition of a pension plan and for benefits provided through those plans. Application of this statement did not have a material effect on the City’s financial statements for the fiscal year ending June 30, 2022.
F. New Accounting Pronouncements - Issued But Not Yet Adopted The City is assessing what effect, if any, the implementation of the following standards will have on the City’s financial statements.
1. GASB Statement No. 91 - Conduit Debt Obligations
The primary objectives of this Statement are to provide a single method of reporting conduit debt obligations by issuers and eliminate diversity in practice associated with (1) commitments extended by issuers, (2) arrangements associated with conduit debt obligations, and (3) related note disclosures. This Statement achieves those objectives by clarifying the existing definition of a conduit debt obligation; establishing that a conduit debt obligation is not a liability of the issuer; establishing standards for accounting and financial reporting of additional commitments and voluntary commitments extended by issuers and arrangements associated with conduit debt obligations; and improving required note disclosures. Application of this statement is effective for the City’s fiscal year ending June 30, 2023.
2. GASB Statement No. 94 - Public-Private and Public-Public Partnerships and Availability Payment Arrangements
The primary objective of this Statement is to improve financial reporting by addressing issues related to public-private and public-public partnership arrangements (PPPs). As used in this Statement, a PPP is an arrangement in which a government (the transferor) contracts with an operator (a governmental or nongovernmental entity) to provide public services by conveying control of the right to operate or use a nonfinancial asset, such as infrastructure or other capital asset (the underlying PPP asset), for a period of time in an exchange or exchange-like transaction. Application of this statement is effective for the City’s fiscal year ending June 30, 2023.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 60 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
3. GASB Statement No. 96 - Subscription-Based Information Technology Arrangements
This Statement provides guidance on the accounting and financial reporting for subscription- based information technology arrangements (SBITAs) for government end users (governments). This Statement (1) defines a SBITA; (2) establishes that a SBITA results in a right-to-use subscription asset—an intangible asset—and a corresponding subscription liability; (3) provides the capitalization criteria for outlays other than subscription payments, including implementation costs of a SBITA; and (4) requires note disclosures regarding a SBITA. Application of this statement is effective for the City’s fiscal year ending June 30, 2023.
4. GASB Statement No. 99 - Omnibus 2022
The objectives of this Statement are to enhance comparability in accounting and financial reporting and to improve the consistency of authoritative literature by addressing (1) practice issues that have been identified during implementation and application of certain GASB Statements and (2) accounting and financial reporting for financial guarantees. Application of this statement is effective for the Authority’s fiscal year ending June 30, 2023.
5. GASB Statement No. 100 - Accounting Changes and Error Corrections – an Amendment of GASB Statement No. 62
The primary objective of this Statement is to enhance accounting and financial reporting requirements for accounting changes and error corrections to provide more understandable, reliable, relevant, consistent, and comparable information for making decisions or assessing accountability. Application of this statement is effective for the Authority’s fiscal year ending June 30, 2024.
6. GASB 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. Application of this statement is effective for the Authority’s fiscal year ending June 30, 2025.
G. Deposits and Investments
1. Investment in the Treasurer’s Pool - The City Controller/Treasurer invests on behalf of most funds of the City in accordance with the City’s investment policy and the California Government Code Section 53601. The City Treasurer, who reports investments and earnings on a monthly basis to the City Council, manages the Treasurer’s Investment Pool. The Treasurer’s Investment Pool consists of two components: 1) pooled deposits and investments and 2) dedicated investment funds. The dedicated investment funds represent restricted funds related to bond issuances of Enterprise Funds. In addition to the Treasurer’s Investment Pool, the City has other funds that are held by trustees. These funds are related to the issuance of Non-Enterprise Fund bonds and certain loan programs of the City.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 61 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
2. Investment Valuation - The City categorizes its investments at fair value measurement within the fair value hierarchy established by generally accepted accounting principles as codified in GASB Statement No. 72, Fair Value Measurement and Application.
All City investments are authorized by statute. The City is invested in the following authorized investment instrumentalities: obligations of the U.S. Treasury, agencies, state and local agencies, and supranationals, negotiable and non-negotiable certificates of deposit, medium term corporate notes, money market mutual funds, and the State Treasurer's investment pool. All are stated at fair value except for the non-negotiable certificates of deposit and money mutual fund which are stated at amortized cost.
3. Investment Income - Cash balances of each of the City’s funds, except for certain Trust and Custodial Funds and other restricted accounts, are pooled and invested by the City. Interest income from pooled investments is allocated to the individual funds based on the fund participant’s average daily cash balance at month end in relation to total pooled investments.
The City’s policy is to charge interest to those funds that have a negative average daily cash balance at month end. Fiscal year-end deficit cash balances are reclassified as Due to Other Funds and funded by operating funds with positive cash balances.
H. Loans Receivable
For the purposes of the Fund Financial Statements, Special Revenue and Capital Projects Funds expenditures relating to long-term loans arising from loan subsidy programs are recorded as loans receivable net of an estimated allowance for potentially uncollectible loans. In some instances, amounts due from external participants are recorded with an offset to an allowance account. The balance of long-term loans receivable includes loans that may be forgiven if certain terms and conditions of the loans are met.
I. Inventories
Inventories recorded in the Proprietary Funds primarily consist of construction materials and maintenance supplies. Generally, Proprietary Funds value inventory at cost or average cost.
Inventory is expensed as it is consumed (the consumption method of inventory accounting). The City uses the purchases method of accounting for inventories in governmental fund types, whereby inventory items are considered expenditures when purchased and are not reported in the balance sheet.
J. Former Redevelopment Agency Property Held for Resale Property of the former RDA, some of which was allocated to Low and Moderate Income Housing (LMIH) ($3.6 million) and some to the Successor Agency ( $0.3 million), is being held for resale per the law dissolving the RDA. The property is recorded at the current determination of the lower of estimated cost or market as documented in its approved Long-Range Property Management Plan (LRPMP). The LRPMP addresses the anticipated disposition and use of the real properties of the former RDA. At June 30, 2022, the adjusted value of the property was $3.9 million.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 62 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Property held for sale may, during the period it is held by the City, generate rental income. This rental income is recognized as it becomes due and is considered collectible. The property held by the LMIH appears on the Nonmajor Governmental Fund Financial Statements and Government-Wide Financial Statements as Property Held for Resale. Property held for resale by the Successor Agency is included in the fiduciary funds.
K. Restricted Assets
Restricted cash is classified as restricted assets on the financial statements because it is maintained in separate bank accounts or tracked separately in the City Treasury group of accounts. Use of the proceeds is limited by applicable bond covenants and resolutions. Restricted assets account for the principal and interest amounts accumulated to pay debt service, unspent bond proceeds and amounts restricted for future capital projects. Restricted grants and interest receivable represent cash and receivables contributed for capital projects and the associated interest.
L. Capital Assets
Capital assets, which include land, buildings and improvements, machinery and equipment, infrastructure, and intangible assets, are reported in the applicable Governmental Activities or Business-Type Activities columns in the Government-Wide Financial Statements and in the Private- Purpose Trust Fund (former RDA). All land not included in property held for resale is defined as Capital Assets, regardless of the acquisition cost of the land. All other acquisitions or constructions (excluding Infrastructure) with an initial cost of $15,000 or more (excluding bundled purchases) and having an estimated useful life in excess of two years are defined as Capital Assets. Computer purchases acquired through a capital lease are capitalized in bulk and not on an individual basis.
Infrastructure with an initial cost of more than $50,000 is capitalized. Improvements that extend an asset’s life or efficiency by over 25% are also capitalized. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed unless they fall below the initial cost threshold.
Asset Category Capitalization
Threshold
Land All Land
Buildings, Improvements, and Machinery & Equipment More than $15,000 Infrastructure More than $50,000
Donated capital assets, donated works of art and similar items, and capital assets received in a service concession arrangement are recorded at acquisition value at the date of donation. Capital outlay is recorded as expenditures of the General, Special Revenue, and Capital Projects Funds and as assets in the Government-Wide Financial Statements to the extent the City’s capitalization threshold is met.
In prior years, interest cost incurred during the construction phase of capital assets of Business-Type Activities was included as part of the capitalized value of the assets constructed. Amortization of assets acquired under capital lease is included in depreciation and amortization.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 63 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Buildings and improvements, infrastructure, and machinery and equipment of the primary government, as well as the component units, are depreciated using the straight-line method over the following estimated used lives:
Asset Category Useful Life
(Years)
Buildings and Improvements 20 to 40
Infrastructure 15 to 55
Machinery and Equipment 3 to 12
Works of art and historical treasures held for public exhibition, education, or research in furtherance of public service, rather than financial gain, are not capitalized. These items are protected, kept unencumbered, cared for and preserved by the City.
Airports Department capitalizes noise mitigation costs consistent with GASB Statement No. 51 - Intangible Assets. Water Rights, in the Water Fund, are also capitalized as Intangible Assets with indefinite useful lives and no amortization. The Airports' Noise Mitigation program consists of improvements made to properties falling within Federal Aviation Administration (FAA) designated high noise impact areas. Although the properties do not belong to Airports, noise insulation measures are installed to reduce the impact of sound decibels inside properties located within the flight path of the airport. In exchange, property owners grant aviation easements to the Airports Department with the easement having an indefinite life. Funding for the program is provided through federal grants.
As of fiscal year end 2022, $18.9 million has been capitalized as an intangible asset. Included in this amount are noise mitigation assets of $2.7 million and Water Rights in the amount of $16.2 million.
Capital Financing Activities
Property, plant and equipment include the following property held under capital financing obligation at June 30, 2022 (in thousands):
Governmental
Activities
Machinery and Equipment $ 42,215
Less: Accumulated Depreciation (27,013)
Net Machinery and Equipment $ 15,202
M. Bond Prepaid Insurance, Bond Premiums and Discounts and Accreted Interest Payable In the Government-Wide Financial Statements, as well as in the Proprietary Fund type and the Fiduciary Fund type in the Fund Financial Statements, long-term debt and other long-term obligations are reported as liabilities in the applicable Governmental Activities, Business-Type Activities, or CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 64 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Proprietary Fund and Fiduciary Fund Statement of Net Position. Bond prepaid insurance is reported as other assets and amortized over the term of the related debt. Bond issuance premiums and discounts are amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond issuance premium or discount. Interest accrued on capital appreciation bonds is reported as accreted interest payable in the Proprietary Fund and as Long-Term Liabilities, Due In More Than One Year in the Government-Wide Statements.
N. Deferred Outflows of Resources
1. Refunding of Debt
The City records deferred outflows of resources in its Proprietary, Fiduciary, and Government- Wide Financial Statements which represent a consumption of net assets that applies to future periods. These financial statement elements are distinct from assets.
Unamortized losses occurring from advance refunding of debt are reported as deferred outflows of resources. As of June 30, 2022, the ending balance of refunding charges yet to be amortized into expense consists of the following (in thousands):
Bonds Charge on Refunding
Governmental Activities:
Lease Revenue Bonds 2017 A&B, NNLB $ 14
Lease Revenue Bonds 2017, Parks Impact 716
Lease Revenue Bonds 2017, Various Capital Projects 15
Lease Revenue Bonds 2017, City Hall Chiller 35
Lease Revenue Bonds 2017, Public Safety 2,389
Total Governmental Activities 3,169
Business-Type Activities:
Airport Revenue Refunding Bonds 2013 10
Lease Revenue Bonds 2017, Convention Center (4)
Convention Center Improvements 2008 E&F 6
Lease Revenue Bonds 2017, Stadium 20
Lease Revenue Bonds 2017, Exhibit Hall 56
Lease Revenue Bonds 2017, Golf Course 50
Total Business-Type Activities 138
Fiduciary Funds:
Successor Agency to the Fresno Redevelopment Agency:
Tax Allocation Bonds Series 2003, Mariposa Project Area 2 Total Charge on Refunding $ 3,309
2. Pension and OPEB
In the Government-Wide Financial Statements and the Proprietary Fund type in the Fund Financial Statements, deferred outflows of resources are recorded for the current year employer pension contributions to the retirement systems, which represent contributions CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 65 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES made after the measurement period in accordance with GASB Statement No. 71. For the OPEB plan, the the employer contribution made after the measurement period is the implicit subsidy for the current fiscal year. Refer to Note 1 (V) and 1 (W) for additional information.
O. Unearned Revenues
Unearned revenues arise when resources are received by the City before it has a legal claim to them (i.e., upfront grants or when the City bills certain fixed rate services in advance). Amounts billed, but not yet earned, are amortized over the service period.
P. Deferred Inflows of Resources
The City records deferred inflows of resources in its Governmental, Proprietary, and Government- Wide Financial Statements which represent an acquisition of net assets that applies to future periods.
In the Government-Wide Financial Statements and the Proprietary Fund type in the Fund Financial Statements, deferred inflows of resources are recorded for unamortized pension revenue and unamortized OPEB expense.
In the governmental fund statements, deferred inflows of resources consist of revenues not collected within the availability period after fiscal year-end. The deferred inflows of resources balance as of June 30, 2022 consists of the following unavailable resources (in thousands):
Deferred Inflows of Resources
General
Fund
Grants Special
Revenue Fund
Other
Governmental
Funds
Total
Governmental
Funds
Property Taxes $ 4,276 $ — $ — $ 4,276
Franchise Taxes 3,123 — — 3,123
Business Tax 5,210 — — 5,210
Measure C and Other Tax — — 1,321 1,321
Code Enforcement Revenue 8,641 — — 8,641
Fire Revenue 857 — — 857
Grant Revenue 180 18,334 953 19,467
Parking Citations, Fines and Other Revenue 682 — — 682 Leases 205 — 653 858
Total $ 23,174 $ 18,334 $ 2,927 $ 44,435
Q. Interfund Transfers
Interfund transfers are generally recorded as transfers in (out). The following types of transactions would not be considered Interfund Transfers, and therefore would not be recorded as an interfund item in the external financial statements. These exceptions include the following:
1. Charges for services are recorded as both revenues of the performing fund and expenditures of the requesting fund. Unbilled costs are recognized as an asset of the performing fund at the end of the fiscal year.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 66 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
2. Reimbursements for expenditures initially made by one fund which are properly applicable to another fund are recorded both as expenditures in the reimbursing fund and as a reduction of expenditures in the fund that is reimbursed.
R. Fund Balance (Deficit)
In the fund financial statements, fund balances of the governmental funds are reported in a hierarchy of classifications which are based on the extent to which the City is bound to honor constraints on the specific purposes for which the amounts in the funds can be spent. Governmental fund balance classifications consist of the following:
1. Nonspendable - Includes amounts that are either not in spendable form or are legally/ contractually required to be maintained intact. These items include those not expected to be converted to cash, such as inventories, prepaid items, and certain long-term receivables.
2. Restricted - Includes amounts which have constraints placed on the use of the resources.
The constraints are either externally imposed by creditors, grantors, contributors, the legally enforceable laws or regulations of other governments, or by the legally enforceable laws or enabling legislation of the government itself.
3. Committed - Includes amounts that can only be used for specific purposes. Various reserves, including the City’s Emergency Reserve, are included as a committed reserve.
Resolution No. 2011-64 established the Reserve Management Act which set forth policy with stringent limitations on the reserve funds. This Act increased the minimum reserve balance to 10% of the adopted budget for the next year’s General Fund appropriations.
A November 16, 2012 ballot measure amended Section 1212 of the City Charter to require that the Council establish a policy for managing the City Reserves. The measure also defined several “qualifying events” under which the City’s Emergency Reserve could be used.
Qualifying events were deemed to be 1) Natural catastrophe; 2) An immediate threat to health and public safety; or 3) A significant decline in General Fund Revenues, which in the opinion of the City Manager, impairs his/her ability to administer the Council adopted budget.
All qualifying events must be declared by the Mayor and ratified by a super majority Council vote.
The Reserve Management Act (the Act) was further amended through Resolution 2015-77, which was adopted on May 15, 2015. The amendment to the Act permitted the use of the Emergency Reserve for year-end cash balancing purposes, with the approval of the Council.
On June 30, 2022 , the Reserve balance identified as Committed Fund Balance was at $48.4 million, including $39.9 million for the General Fund Emergency Reserve.
On December 7, 2017, with the adoption of Resolution No. 2017-334, the Act was again amended. The Resolution stated that any real or personal asset sale of City property with CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 67 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES proceeds greater than $15,000, which would otherwise be deposited into the General Fund, shall instead be deposited into an Asset Sale/Special Windfall Reserve Fund. Proceeds deposited into this new fund are amortized over a five-to-ten year period and used to provide a revenue stream for General Fund items deemed necessary to deliver core City services for the protection and benefit of the citizens of Fresno. Monies from the Asset Sale/Special Windfall Reserve Fund are currently being used to fund salaries of additional police dispatchers. The Committed Fund Balance as of June 30, 2022 includes $1.3 million within this fund.
In addition to the City's Emergency Reserve, the Committed Fund Balance as of June 30, 2022 also consists of $2.6 million designated exclusively for use in a year when a 27 th pay period occurs. Monies are set aside each year to fund the extra pay period that is a product of paying employees bi-weekly. The next fiscal year containing a 27 th pay period is fiscal year 2028.
The Committed Fund Balance as of June 30, 2022 also includes $4.5 million for the Housing Reserve. Funds in this reserve are to be used exclusively for construction of low-income housing, or subsidizing private sector development of low-income housing.
4. Assigned - Includes amounts that are not classified as nonspendable, restricted, or committed, but which are intended by the City to be used for specific purposes. Intent is expressed by legislation or action of the City Council, the Mayor, or the City Manager which legislation has delegated the authority to assign amounts for specific purposes.
5. Unassigned - The residual classification for fund balance, which includes all amounts not reported as nonspendable, restricted, committed, or assigned. The General Fund may report either a positive or negative unassigned fund balance. Unassigned amounts are available for any purpose. Other governmental funds may report only negative unassigned fund balances if expenditures incurred for specific purposes exceeded amounts restricted, committed or assigned for those purposes.
When multiple classifications of resources are available for use, it is the City’s policy to use resources in the order of restricted, committed, assigned, and unassigned.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 68 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Fund Balances of the governmental funds at June 30, 2022 consisted of the following (in thousands):
Grants Other Total
General Special Revenue Governmental Governmental
Fund Fund Funds Funds
Fund Balances:
Restricted:
Debt Service $ — $ — $ 5,020 $ 5,020
CDBG and Home Loans — 8,995 — 8,995
Revitalization — — 627 627
Culture and Recreation — — 31,203 31,203
Street Works — — 16,337 16,337
Transportation — — 25,548 25,548
Pedestrian and Bicycle Program — — 1,166 1,166
Prop 42 Traffic Congestion Relief — — 215 215
AD #131 UGM Reimbursement — — 1,868 1,868
Forfeitures — — 39 39
CASP Program Senate Bill 1186 — — 758 758
Grants — 3,202 — 3,202
CARES, Emergency Rental Assist, ARPA Grants — 11,086 — 11,086 Housing and NSP Grants — 9,016 — 9,016
Impact Fees — — 54,133 54,133
Special Assessment Projects — — 13,959 13,959
Low to Moderate Income Housing — — 33,750 33,750
Committed:
27th Pay Period Reserve 2,566 — — 2,566
Emergency Reserve General Fund 39,913 — — 39,913
Asset Sale Reserve Fund 1,342 — — 1,342
Housing Reserve 4,539 — — 4,539
Assigned:
Public Works Maintenance 3,355 — — 3,355
Median Island Maintenance — — 4 4
Parks Maintenance 1,654 — 1,085 2,739
Right of Ways Acquisition — — 2,556 2,556
Street Tree Fees — — 86 86
Public Protection 309 — 1,026 1,335
Public Works Projects — — 2,388 2,388
General Purpose 11,648 — — 11,648
Enterprise Zone — — 4 4
City Hall Improvements — — 176 176
Various Capital Projects — — 678 678
Miscellaneous Paving — — 4,233 4,233
PD Capital Projects — — 126 126
Fire Capital Projects — — 25,246 25,246
Parking Garage 7 — — 108 108
Woodward & Japanese Garden Projects — — 92 92
Police Administration & Patrol 454 — — 454
Planning & Community Revitalization 1,795 — — 1,795 Local Agency Protects — — 6 6
Unassigned 37,116 — (2,678) 34,438
Total Fund Balance (Deficit) $ 104,691 $ 32,299 $ 219,567 $ 356,557 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 69 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES S. Net Position/(Deficit)
Net position/(deficit) represents the difference between assets/deferred outflows of resources and liabilities/deferred inflows of resources in the Government-Wide and Proprietary Fund Statements of Net Position. Net investment in capital assets consists of capital assets, net of accumulated depreciation, reduced by the outstanding balances of any borrowings used for the acquisition, construction or improvement of those assets. The restricted component of net position consists of restricted assets reduced by liabilities and deferred inflows of resources related to those assets.
Generally, a liability relates to restricted assets if the asset results from a resource flow that also results in the recognition of a liability or if the liability will be liquidated with the reported restricted assets. Unrestricted net position represents net position elements which are not restricted.
T. Cash Flows
The Statements of Cash Flows are presented for Proprietary Fund types. Cash and cash equivalents include all unrestricted and restricted highly liquid investments with original purchase maturities of three months or less. Pooled cash and investments in the City’s Treasury represent monies in a cash management pool and such accounts are similar in nature to demand deposits.
U. Regulatory Assets and Liabilities
At June 30, 2022, the Statement of Net Position Business-Type Activities reflected approximately $0.8 million in regulatory assets related to the Central Valley Project (CVP) Water Settlement. These assets will continue to have an impact on water rates which are to be charged to customers over approximately the next 20 years. The settlement for past deficiencies was negotiated between the City and the United States Bureau of Reclamation (USBR). Under GASB Statement No. 62, Codification of Accounting and Financial Reporting Guidance , regulatory assets represent future revenue associated with certain costs (CVP Litigation Settlement) that will be recovered from customers through the ratemaking process.
V. Pensions
For purposes of measuring the net pension asset, deferred outflows/inflows of resources related to pensions and pension revenue/expense, information about the fiduciary net position of the City’s two pension plans, City of Fresno Employees Retirement System and the City of Fresno Fire and Police Retirement System (Plans), and additions to/deductions from the Plans’ fiduciary net position have been determined on the same basis as they are reported by the Plans, which is the accrual basis of accounting. Employer and employee contributions are recognized as revenue when due.
Contributions are recorded in the period the related salaries are earned and become measurable.
Investment income is recognized when it is earned. The net appreciation in fair value of investments held by the Plans is recorded as an increase to investment income based on the valuation of investments at fiscal year-end, which includes both realized and unrealized gains and losses on investments. Retirement benefits and refunds are recognized when due and payable under the terms of the Plans.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 70 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES W. Other Post-Employment Benefits (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows/inflows of resources related to OPEB, and OPEB revenue/expense, information about the fiduciary net position of the City’s OPEB Plan, and additions to/deductions from the OPEB Plan's fiduciary net position have been determined on the same basis, which is the accrual basis of accounting. For this purpose, the OPEB Plan recognizes benefit payments when due and payable in accordance with the benefit terms. While participant retirees pay 100% of their premium costs, they are allowed to purchase insurance at blended premium rates. Thus, the City's contribution is deemed to be equal to the implicit subsidy, which is that portion of retiree claims costs over premiums contributed by retirees.
X. Estimates
The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 71 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Note 2. Cash and Investments
A. City Cash and Investments
1. Sponsored Investment Pool
As part of the City’s total cash and investment portfolio, the Treasury Officer and staff, under the supervision of the Controller, manage an investment pool that includes only internal investors and is available for use by all funds. The pool is not registered with the Securities and Exchange Commission as an investment company. Investment activity is reported monthly to the City Council by posting reports to the City’s web page and annually through an investment policy submitted to the Council for review and approval. The investments are reported at fair value, which is determined monthly. Participants’ shares are determined by the daily cash balance deposited in the pool (the value of its pool shares). Investment income earned by the pooled investments is allocated to the various funds on a monthly basis, based on each fund's daily cash balance. Interest payments are paid to the various funds also on a monthly basis. The value of the pool shares is based upon amortized cost in day-to-day operations, but is adjusted to the fair value at year-end. The value of the shares is supported by the value of the underlying investments. Each fund type's portion of this pool is displayed on the financial statements as “Cash and Investments.” In addition, certain funds related to debt issues have investments with trustees.
The following is a summary of cash, deposits, and investments at June 30, 2022 (in thousands):
(in thousands) Primary Government
Category
Governmental
Activities
Business-Type
Activities
Fiduciary
Funds Total
Cash and Investments $ 346,173 $ 307,108 $ 8,450 $ 661,731 Restricted Cash and Investments 133,207 241,030 997 375,234 Pension Trust Investments at Fair Value — — 3,468,850 3,468,850 Collateral Held for Securities Lent — — 131,286 131,286 Total $ 479,380 $ 548,138 $ 3,609,583 $ 4,637,101
2. Cash and Deposits
At year-end, the City's bank balance was $ 63.1 million inclusive of Successor Agency to the Fresno Redevelopment Agency Private-Purpose Trust Fund and pension trust funds. The recorded balance reflected in the June 30, 2022 financial statements was $65.2 million. The difference is due to deposits in transit and outstanding checks.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 72 NOTE 2 - CASH AND INVESTMENTS
3. Fair Value Hierarchy
The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. These principles recognize a three-tiered fair value hierarchy, as follows:
• Level 1: Investments reflect prices quoted (unadjusted) for identical assets or liabilities in active markets.
• Level 2: Inputs other than quoted prices included in Level 1 that are observable for an asset or liability, either directly or indirectly. Inputs to the valuation include prices that are based on a similar observable asset either directly or indirectly, which may include inputs in markets that are not considered to be active. • Level 3: Inputs are unobservable inputs for an asset or liability where there are little market activities. The inputs into the determination of fair value are based upon unobservable sources and may require estimation.
The City uses the market approach as a valuation technique in the application of GASB Statement No. 72. This method uses prices and other relevant information generated by market transactions involving identical or comparable assets or group of assets. Fair value is the price that would be received to sell an asset in an orderly transaction between market participants at the measurement date. Securities listed on the fair value hierarchy are valued by the custodial bank using Data Feed purchased from Interactive Data Corporation (IDC). The Level 2 Data Feed provides end of day independent valuations utilizing rules based on logic and standard valuation techniques. It maximizes the use of relevant observable inputs including quoted prices for similar assets, benchmark yield curves, and market corroborated inputs.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 73 NOTE 2 - CASH AND INVESTMENTS The following is a summary of the fair value of the City’s investments using the hierarchy previously discussed (in thousands):
Pooled Investments by Fair Value Level June 30, 2022 Level 1 Level 2 Federal Farm Credit Bank Bonds $ 105,015 $ — $ 105,015
Federal Home Loan Bank Bonds 170,113 — 170,113
Federal Home Loan Mortgage Corporation Bonds 33,193 — 33,193 Federal National Mortgage Association Bonds 23,149 — 23,149 Federal Ag Mortgage Corporation 23,326 — 23,326
U.S. Treasury Securities 82,243 82,243 —
U.S. Sovereign Bonds 4,981 — 4,981
Medium Term Corporate Notes 255,296 — 255,296
Negotiable Certificates of Deposit 54,041 — 54,041
Total Pooled Investments by Fair Value 751,357 82,243 669,114 Pooled Investments Not Subject to the Fair Value Hierarchy State Local Agency Investment Fund (LAIF) 42,296
Time Deposits 2,800
Municipal Bonds 113,360
Supranationals 27,928
Money Market Funds 6,000
Total Pooled Investments Not Subject to the Fair Value Hierarchy 192,384 Total Pooled Investments 943,741
Investments Held Outside the Treasurer's Pool by Fair Value Level U.S. Treasury Securities 443 443
Investments Held Outside the Treasurer's Pool Not Subject to the Fair Value Hierarchy
Money Market Mutual Funds 27,371
Total Investments Held Outside the Treasurer's Pool Not Subject to the Fair Value Hierarchy 27,371
Total Investments Held Outside the Treasurer's Pool 27,814 Grand Total of Investments $ 971,555 $ 82,686 $ 669,114 Note: There are no level 3 investments.
According to GASB Statement No. 72, money market investments and participating interest- earning investment contracts that have a remaining maturity at the time of purchase of one year or less should be measured at amortized cost, and as such, are not shown in the fair value hierarchy. In addition, the City's investment in LAIF is also not subject to the fair value hierarchy, as the amount available for withdrawal is based on the amortized cost.
4. Cash, Deposits, and Investments
Cash includes amounts in demand and time deposits. Investments are reported in the accompanying financial statements at fair value, except for certain certificates of deposit and investment contracts that are reported at cost because they are not transferable and they have terms that are not affected by changes in market interest rates.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 74 NOTE 2 - CASH AND INVESTMENTS Changes in fair value that occur during a fiscal year are recognized as income from property and investments. Income from property and investments includes interest earnings; changes in fair value; any gains or losses realized upon the liquidation, unrealized gains and losses, maturity, or sales of investments; property rentals and the sale of City owned property.
5. Investments Authorized by the California Government Code and the City’s Investment Policy The City maintains a formal investment policy, which is adopted annually by the City Council.
All investments held in the Treasurer's Pool are consistent with the City's investment policy objectives of preservation of principal, adequacy of liquidity, and achievement of an average market rate of return.
The policy addresses the soundness of financial institutions in which the City will deposit funds, types of investment instruments as permitted by the California Government Code, and the percentage of the portfolio that may be invested in certain instruments with longer terms to maturity. A copy of the City’s current investment policy can be found at www.fresno.gov/ finance/investmentpolicy.pdf.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 75 NOTE 2 - CASH AND INVESTMENTS The following graphs depict the allocation of the Treasury Pool’s assets among the various authorized investments, as well as maturity periods, as of June 30, 2021 and June 30, 2022:
City of Fresno Treasurer's Pool (Fair Value)
June 30, 2022
5.20%
3.95%
24.32%
4.81%
5.56%
0.66%
17.42%
5.97%
5.95%
0.57%11.95%
0.65%
0.73%
10.96%
1.32%
Federal Home Loan Mortgage CorporationState Local Agency Investment Fund Medium Term Corporate NotesNegotiable Certificates of Deposit Federal Home Loan BankFederal National Mortgage Association Money Market FundsFederal Farm Credit Bank
Cash AccountsTime Deposits
U.S. Treasury SecuritiesCollateralized Mortgage Obligations U.S. Sovereign BondsMunicipal Bonds
Supranationals
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 76 NOTE 2 - CASH AND INVESTMENTS City of Fresno Treasurer's Pool (Fair Value)
June 30, 2021
3.37%
4.30%
25.96%
5.49%
17.30%
2.35%
0.61%
10.68%
6.42%
0.28%8.36%
0.51%
11.53%
2.84%
Federal Home Loan Mortgage CorporationState Local Agency Investment Fund Medium Term Corporate NotesNegotiable Certificates of Deposit Federal Home Loan BankFederal National Mortgage Association Money Market FundsFederal Farm Credit Bank
Cash AccountsTime Deposits
U.S. Treasury SecuritiesCollateralized Mortgage Obligations U.S. Sovereign BondsMunicipal Bonds
Supranationals
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 77 NOTE 2 - CASH AND INVESTMENTS City of Fresno
Treasurer's Pool Maturity Schedule
As of June 30, 2022
35.91%
16.41%
16.34%
17.14%
14.21%Less than 1 Year
1 - 2 Years
2 - 3 Years
3 - 4 Years
4 - 5 Years
As of June 30, 2021
26.01%
15.38%
21.04%
19.46%
18.11%
B. Investments Authorized by Debt Agreements
Investment of debt proceeds held by bond trustees is governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City’s investment policy. Investments held outside the Treasurer's Pool consist mainly of required reserve funds for various bond issues. They are held by trustees, and are not available for the City's general expenditures.
Investment agreements are used for the investment of bond proceeds in accordance with the permitted investment provisions of the specific bond indentures, which are prepared in accordance with numerous safeguards to reduce the risk associated with a provider’s ability to meet its contractual obligations.
The City has invested bond trust monies into securities with maturity periods of one to three years under a “ladder” approach to investing. Such a structure allows for reinvestment in the short- term until interest rates begin to rise. Staff believes that investing in the long-term at this time would commit the City into low earnings, instead of taking advantage of opportunities in case rates begin to rise. During fiscal year 2022, total interest of $ 0.02 million was earned from the following instruments:
• Money Market Funds - $0.02 million
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 78 NOTE 2 - CASH AND INVESTMENTS C. Types of Risk Associated with the Treasury Pool’s Investments
1. Investment Risk
The City invests in no derivatives other than structured (step-up) notes, which guarantee coupon payments. These are minimal risk instruments. All investments are held by a third- party custodian in the City’s name.
2. Deposit and Investment Risk
The risk disclosures below apply to the City's internal investment pool and deposits as well as investments held by trustees for debt service funds or bond proceeds. Portfolio investments are exposed to four main types of risk: concentration, interest rate, default, and custodial risk.
Deposits are exposed primarily to custodial credit risk.
3. Concentration of Credit Risk
The investment policy of the City contains limitations on the amount that can be invested in any one issuer, which are more restrictive than those stipulated by the California Government Code. While the State has no limit on the percentage of the portfolio that can be invested in a single U.S. Government Agency Security, the City’s Investment Policy limits investment in any one issuer to 50% of the portfolio. Also, while the State limits investments to 30% of the Portfolio for any single issuer of Medium Term Notes, the City's Investment Policy limits investments to 20% of the portfolio invested in any single issuer. Investments in any one issuer (other than U.S. Treasury securities, money market funds, and external investment pools) that represent 5% or more of the total Treasurer’s Pool investments or investments with trustees are as follows (in thousands):
Treasurer's Pool Investments
Issuer Investment Type Amount % of Total
Treasurer's Pool Investments:
Federal Farm Credit Bank U.S. Government Agency $ 105,015 10.43 % Federal Home Loan Bank U.S. Government Agency 170,113 16.90 % Federal Home Loan Mortgage Corp. (FHLMC) U.S. Government Agency 33,193 3.30 % Federal National Mortgage Association (FNMA) U.S. Government Agency 23,149 2.30 % Federal Ag Mortgage Corporation U.S. Government Agency 23,326 2.32 % $ 354,796 35.25 %
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 79 NOTE 2 - CASH AND INVESTMENTS
4. Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally the longer the maturity of an investment, the greater will be the sensitivity of its fair value to changes in market interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of shorter term and longer term investments. Another way the City mitigates this risk is by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time to provide the cash flow and liquidity needed for operations. The City monitors the interest rate risk inherent in its portfolio by measuring the weighted average maturity of its portfolio. The Investment Policy limits the portfolio's weighted average maturity to three years, except for debt agreements held by trustees which are governed by the indentures and may be longer.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 80 NOTE 2 - CASH AND INVESTMENTS Interest rate risk for the Treasurer’s Pool and for investments with trustees is disclosed in the following table. As of June 30, 2022, the City had the following cash and investments in its portfolio (in thousands):
Investment Maturities
Treasurer's Pool Fair Value
Less than 1
Year
1 to 5
Years
5 to 10
Years
More than
10 Years
Cash Accounts $ 63,120
Treasurer's Pool Investments
U.S. Government Agencies:
Federal Farm Credit Bank 105,015 $ 14,564 $ 90,451 $ — $ — Federal Home Loan Bank 170,113 14,957 155,156 — —
Federal Home Loan Mortgage Corp. 33,193 — 33,193 — — Federal National Mortgage Association 23,149 — 23,149 — — Federal Ag Mortgage Corporation 23,326 — 23,326 — — Subtotal of U.S. Government Agencies 354,796 29,521 325,275 — — U.S. Treasury Securities 82,243 24,915 57,328 — —
U.S. Sovereign Bonds 4,981 — 4,981 — —
Medium Term Corporate Notes 255,296 37,700 217,596 — — Negotiable Certificates of Deposit 54,041 4,966 49,075 — — State Local Agency Investment Fund (CA LAIF) 42,296 42,296 — — — Time Deposits 2,800 2,800 — — —
Municipal Bonds 113,360 17,644 95,716 — —
Supranationals 27,928 4,957 22,971 — —
Money Market Mutual Funds 6,000 6,000 — — —
Total Treasurer's Pool Investments 1,006,861 $ 170,799 $ 772,942 $ — $ — Investments Held Outside the Treasurer's Pool
Debt Service Funds/Bond Proceeds:
Mutual Funds 27,371 27,371 — — —
U.S. Government & Agency Securities 443 443 — — —
$ 27,814 $ — $ — $ —
Other Deposits 16,993
Outstanding Checks (16,748)
Deposits in Transit 1,868
Petty Cash 177
Pension Trust Assets (See separate ACFRs) 3,600,136
Total Cash and Investments $ 4,637,101
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 81 NOTE 2 - CASH AND INVESTMENTS
5. Default Credit Risk
Generally, default credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This risk is measured by the assignment of a rating by a nationally recognized statistical rating organization.
The following table represents the minimum rating required by (where applicable) the California Government Code, the City’s investment policy, or debt agreements, and the actual rating as of year-end for each investment type:
Treasurer's Pool Investments:
U.S. Government Agency Securities:
Federal Farm Credit Bank $ 105,015 A AA+ 10.43%
Federal Home Loan Bank 170,113 A AA+ 16.90%
Federal Home Loan Mortgage Corporation 33,193 A AA+ 3.30% Federal National Mortgage Association 23,149 A AA+ 2.30% Federal Ag Mortgage Corporation 23,326 Unrated Unrated 2.32% U.S. Treasury Securities 82,243 A Aaa 8.17%
U.S. Sovereign Bonds 4,981 A AA+U 0.49%
Medium Term Corporate Notes:
AIG Global Funding 4,674 A A+ 0.46%
Apple Inc 18,057 A AA+ 1.79%
Bank of America 17,909 A A- 1.78%
Bank of New York 7,554 A A 0.75%
Berkshire Hathaway Inc 5,000 A AA 0.50%
Caterpillar, Inc. 4,740 A A 0.47%
Chevron Corp 4,996 A AA- 0.50%
CIT Group Holdings Inc 10,017 A A 0.99%
Credit Suisse 4,894 A A 0.49%
Equitable Financial Life 4,796 A A+ 0.48%
Estee Lauder Co 5,000 A A+ 0.50%
Exxon Mobil Corporation 4,925 A AA- 0.49%
Florida Power & Light 4,913 A A+ 0.49%
Harvard Pres & Fellows 3,976 A AAA 0.39%
HSBC USA Inc. 4,972 A A- 0.49%
JP Morgan Chase 9,036 A A- 0.90%
Lloyds Bank 4,950 A A+ 0.49%
Massmutual Global Fund 4,886 A AA+ 0.49%
Met Life Global 4,544 a AA- 0.45%
New York Life 17,766 A AA+ 1.76%
Novartis Capital Corp 5,002 A AA- 0.50%
Pacific Life 4,832 A AA- 0.48%
Pricoa Global Funding 5,001 A AA- 0.50%
Principal Lfe Glb Fnd 4,596 A A+ 0.46%
Protective Life 4,517 A AA- 0.45%
Royal Bank of Canada 14,053 A A 1.40%
Sanofi Pharmaceutical 5,002 A AA 0.50%
Shell International Fin 9,894 A A+ 0.98%
Toyota Motor Credit Corp 25,454 A A+ 2.53%
U.S. Bank Corp 9,637 A A+ 0.96%
UBS Finance Delaware 4,840 A A+ 0.48%
U.S. Bank Na Cincinnati 9,890 A AA- 0.98%
Wal-Mart Stores 4,974 A AA 0.49%
Issuer Amount
(in thousands)
Minimum
Legal
Rating
Rating at
Year-End
% of
Treasurer's
Pool
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 82 NOTE 2 - CASH AND INVESTMENTS Municipal Bonds
Antelope Valley Union High 1,722 NA NA 0.17%
Chaffey Community College 2,688 NA NA 0.27%
City of Vallejo 1,481 NA AA 0.15%
County of Riverside Ca 4,851 NA AA 0.48%
County of Westchester Ny 1,801 NA AA+ 0.18%
Golden State Tobacco 1,828 NA A+ 0.18%
Golden State Tobacco 5,760 NA A+ 0.57%
Los Altos School Dist 4,769 NA NA 0.47%
Los Angels Unified School Dist 3,132 NA Aa3 0.31%
Los Angels Unified School Dist 14,563 NA A+ 1.45%
New York State Dormitory 1,534 NA AA+ 0.15%
New York State Dormitory 980 NA AA+ 0.10%
New York State Urban Dev 4,898 NA Aa1 0.49%
New York State Urban Dev 1,230 NA Aa1 0.12%
State of California 4,951 NA AA- 0.49%
State of California 4,980 NA AA- 0.49%
State of California 9,468 NA AA- 0.94%
State of Connecticut 5,007 NA A+ 0.50%
State of Hawaii 5,786 NA AA+ 0.57%
State of New York 6,644 NA AA+ 0.66%
State of Wisconsin 3,969 NA AA 0.39%
Texas A&M University 4,977 NA AAA 0.49%
Texas A&M University 2,965 NA AAA 0.29%
University of California 13,375 NA AA 1.33%
Supranational
Inter American Development Bank 9,827 AA AAA 0.98%
International Bank for Reconstruction & Dev 18,101 AA AAA 1.80% Negotiable Certificates of Deposit 54,041 NA Unrated 5.37% State Local Agency Investment Pool 42,296 NA Unrated 4.20% Time Deposits 2,800 NA Unrated 0.28%
Money Market Mutual Funds 6,000 NA Unrated 0.60%
Total Treasurer's Pool Investments $ 943,741 93.75%
Issuer Amount
(in thousands)
Minimum
Legal
Rating
Rating at
Year-End
% of
Investments
with Trustees
Investments with Trustees:
Money Market Funds $ 27,371 NA Unrated 98.41%
U.S. Government & Treasury Securities 443 NA AAA 1.59% Total Investments with Trustees $ 27,814 100.00%
1Standard & Poor's rating of SP-1 indicates a strong capacity to pay principal and interest. An issue determined to possess a very strong capacity to pay debt service is given a plus (+) designation.
Issuer Amount
(in thousands)
Minimum
Legal
Rating
Rating at
Year-End
% of
Treasurer's
Pool
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 83 NOTE 2 - CASH AND INVESTMENTS The City of Fresno’s Investment Policy requires that the City only invest in high quality obligations, which means only those with a rating category of “A” or better by a nationally recognized rating service.
6. Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The City maintains cash accounts at Bank of America. The City maintains separate accounts for payment of general accounts payable checks, payroll checks, and utility refund checks. Amounts in excess of $250,000 are securitized in accordance with California Government Code Section 53652. The California Government Code and the City’s investment policy contain legal or policy requirements that limit the exposure to custodial credit risk for deposits. The California Government Code requires that a financial institution 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 (unless so waived by the governmental unit). The market 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 collateral pledged to cover the public fund deposits in California is held in the name of the California Collateral Pool Administrator and is held in their name by the Federal Reserve Bank as custodian. The City had no uncollateralized cash at June 30, 2022 .
As of June 30, 2022 , the City’s deposits with institutions in excess of federal depository insurance limits were $59.9 million held in accounts collateralized in accordance with California law as described above.
The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer) to the transaction, a government will not be able to recover the value of its investment of securities that are in the possession of the counterparty. As of June 30, 2022, in accordance with the City's investment policy, none of the City's investments were held with a counterparty. All of the City's investments were held with an independent third party custodian bank. The City uses Bank of New York Trust Company (BNY) as a third- party custody and safekeeping service for its investment securities. Custodial credit risk is the risk that the City will not be able to recover the value of its investments in the event of a BNY failure. All City investments held in custody and safe-keeping by BNY are held in the name of the City and are segregated from securities owned by the bank. This is the lowest level of custodial credit risk exposure.
D. Investment in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF), which is regulated by the California Government Code under the oversight of the Treasurer of the State of California. The fair value of the City's investment in this pool is reported in the accompanying financial statements at amounts based upon the City's pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawal is CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 84 NOTE 2 - CASH AND INVESTMENTS based on the accounting records maintained by LAIF, which are recorded on a fair value cost basis.
The total amount invested by all public agencies in LAIF as of June 30, 2022, was $35.8 billion. LAIF is part of the California Pooled Money Investment Account (PMIA), which at June 30, 2022 , had a balance of $234.5 billion . Of that amount, 1.88% was invested in medium-term and short-term structured notes and asset-backed securities. The average maturity of PMIA investments was 311 days as of June 30, 2022.
LAIF has the following restrictions on withdrawals:
• For same day transactions, the requesting agency must contact LAIF by 10 a.m. PST. • Transaction calls received after 10 a.m. are processed the following business day. • A requesting agency can only conduct a maximum of 15 transactions (combination of deposits and withdrawals) per month.
• 24-hour notice is needed for withdrawals of $10 million or more. • The minimum transaction amount is $5,000, with amounts above the minimum transacted in increments of $1,000.
• Prior to the funds transfer, an authorized person from the requesting agency must call LAIF to do a verbal transaction.
E. Pension Trust (Retirement Systems) Deposits and Investments The investment guidelines for the City of Fresno’s Retirement Systems (Systems) reflect the duties imposed by an investment standard known as the “prudent expert rule.” The prudent expert rule includes anyone who has discretionary authority with respect to the Systems’ investments.
The Fire and Police Retirement System's Investment Policy can be found at https://www.cfrs- ca.org/fire-and-police-retirement-system_investments, while the Employees Retirement System's Investment Policy can be found at https://www.cfrs-ca.org/employee-retirement-system/investments.
Both investment policies can also be obtained by contacting the Retirement Office at 2828 Fresno Street, Suite 201, Fresno, CA 93721.
Northern Trust serves as custodian of the Systems’ investments. The Systems’ asset classes include U.S. Equity, International Equity, U.S. Fixed Income, International Fixed Income, Direct Lending, and Real Estate. Any class may be held in direct form, pooled form, or both. The Systems have 15 external investment managers, managing 19 individual portfolios.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 85 NOTE 2 - CASH AND INVESTMENTS Investments at June 30, 2022 consist of the following (in thousands):
Investments at Fair Value
Domestic Equity $ 1,055,209
International Developed Market 443,289
Real Estate 532,153
Government Bonds 205,016
Corporate Bonds 371,511
Short-Term Investments 13,112
Alternatives 848,560
Total Investments at Fair Value $ 3,468,850
Both Retirement Boards have established policies for investing, specifying the following target allocations with a minimum and maximum range for each of these asset classes:
Asset Class Minimum Target Maximum
Domestic Large Cap Equities 15.0% 25.0% 36.0%
International Developed Market Equities 10.0% 23.0% 25.0% Core Fixed Income 5.0% 13.0% 20.0%
High Yield Bonds 0.0% 3.0% 5.0%
Core Real Estate 5.0% 10.0% 15.0%
Value Add Real Estate/REITs 2.0% 4.0% 8.0%
Infrastructure 2.0% 5.0% 10.0%
MLPs 0.0% 4.0% 7.0%
Private Equity 0.0% 3.0% 10.0%
Direct Lending/Private Debt 5.0% 10.0% 20.0%
100.0%
The Retirement Systems have investments in Tiers 1, 2, and 3 as defined under GASB Statement No.
72. For further information regarding the Retirement Systems’ classification of investment, please see the Retirement Systems’ Annual Comprehensive Financial Reports (Systems' ACFRs).
Investments of the Systems are exposed to custodial credit risk, credit and interest rate risk, concentration risk, and foreign currency risk. In addition to those risks, the Systems are also exposed to credit risk and market risk associated with their derivatives investments. For a detailed description of all of the risks associated with the Systems’ investments, please see the Systems’ ACFRs which can be found at https://www.cfrs-ca.org/fire-and-police-retirement-system/financial/ and https:// www.cfrs-ca.org/employee-retirement-system/ers-financial/ or by contacting the Retirement Office at 2828 Fresno Street, Suite 201 Fresno, CA 93721.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 86 NOTE 2 - CASH AND INVESTMENTS F. Stewardship, Compliance and Accountability
There have been no material violations of finance-related legal or contractual provisions.
G. Restricted Assets
Restricted cash includes funds held by trustees relating to bonds payable and those amounts held by each fund for which a specific, non-operating use has been determined. Restricted interest receivable is interest earned with the trustee.
Restricted assets are reported in the following funds at June 30, 2022 (in thousands):
Cash and
Investments
Current and
Noncurrent
Interest
Receivable Total
Governmental Activities:
General Fund $ 48,180 $ — $ 48,180
Grants Special Revenue Fund 82,852 — 82,852
Nonmajor Governmental Funds 1,286 — 1,286
Internal Service Funds 889 — 889
Subtotal 133,207 — 133,207
Business-Type Activities
Water System 67,638 245 67,883
Sewer System 63,405 220 63,625
Solid Waste Management 10,207 — 10,207
Transit 53,804 — 53,804
Airports 38,313 — 38,313
Convention Center 1,350 — 1,350
Stadium 907 — 907
Nonmajor Enterprise Funds 969 — 969
Internal Service Funds 4,437 — 4,437
Subtotal 241,030 465 241,495
Fiduciary:
Private-Purpose Trust Fund 443 — 443
Custodial Funds 554 — 554
Subtotal 997 — 997
Total $ 375,234 $ 465 $ 375,699
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 87 NOTE 2 - CASH AND INVESTMENTS Note 3. Property Taxes
Article XIII of the California Constitution (Proposition 13) limits ad valorem taxes on real property to 1% of value plus taxes necessary to pay indebtedness approved by voters prior to July 1, 1978. The Article also established the 1975/1976 assessed valuation as the base and limits annual increases to the cost-of-living adjustment, not to exceed 2% 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 two-thirds of the qualified electors.
All property taxes are collected and allocated by the County of Fresno to the various taxing entities.
Property taxes are determined annually as of January 1 and attached as enforceable liens on real property. Taxes are due November 1 and February 1 and are delinquent if not paid by December 10 and April 10, respectively. Secured property taxes become a lien on the property on January 1.
Property taxes on the unsecured roll are due on the January 1 (lien date) and become delinquent if unpaid on August 31. Property tax revenues are recognized in the governmental funds in the fiscal period for which they are levied and collected, adjusted for any amounts deemed uncollectible and amounts expected to be collected more than 60 days after the fiscal year.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
88 NOTE 3 - PROPERTY TAXES Note 4. Receivables
Receivables are presented in the financial statements net of the allowance for uncollectible accounts. The uncollectible accounts related to accounts receivable at June 30, 2022 were $ 3.4 million for the General Fund, $ 3.5 million for Water System, $ 3.7 million for Sewer System, $ 2.8 million for Solid Waste Management, $ 0.4 million for Airports, and $ 2.5 million for Other Enterprise Funds. The uncollectible accounts related to notes receivable at June 30, 2022 were $8.4 million for Grants Special Revenue Fund and $ 1.8 million for Other Governmental Funds.
Accounts not scheduled for collection during the subsequent year are $ 75.1 million for Governmental notes and loans and $17.4 million for Business-Type notes and loans.
The allowance for doubtful accounts is a Statement of Net Position and/or Balance Sheet account that reduces the reported amount of a receivable. Providing an allowance for doubtful accounts presents a more realistic picture of how much of the receivable is likely to be turned into cash, particularly in the near term. The amount of the allowance for each fund is a determination made by management at the end of the fiscal year through a review of past collections received on each account. This analysis includes reviewing the aging of the receivable balance, past account write- offs and other known variables.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
89 NOTE 4 - RECEIVABLES
Receivables, net of amounts uncollectible, (in thousands) as of June 30, 2022 were as follows:
Intergovernmental
Receivable
Interest
Accounts
Receivable
Grants
Receivable
Property
Taxes Other
Notes,
Loans &
Other
Receivable
Operating
Lease
Receivable Total
Governmental Activities
General Fund $ 382 $ 17,617 $ 180 $ 8,041 $ 34,635 $ — $ 208 $ 61,063 Grants Special Revenue
Fund 485 — 18,354 — — 54,460 — $ 73,299
Other Governmental Funds 686 637 1,315 — 17,511 20,084 569 $ 40,802 Internal Service Funds 426 945 — — — — — $ 1,371 Subtotal $ 1,979 $ 19,199 $ 19,849 $ 8,041 $ 52,146 $ 74,544 $ 777 $ 176,535 Advances to Successor
Agency and Due To(From)
Fiduciary Funds 6,953
Total $ 183,488
Business-Type Activities
Water System $ 909 $ 22,325 $ — $ — $ — $ 2,029 $ 3,034 $ 28,297 Sewer System 753 13,103 — — 921 3,089 2,800 $ 20,666 Solid Waste Management 85 6,607 — — — 10,258 — $ 16,950 Transit 240 211 5,671 — 7,006 — — $ 13,128
Airports 238 1,944 763 — 137 — 16,217 $ 19,299
Fresno Convention Center — 317 — — — — — $ 317
Stadium 6 397 — — — — 1,655 $ 2,058
Other Enterprise Funds 18 1,914 — — — — 1,597 $ 3,529 Internal Service Funds 95 533 — — — — 347 $ 975
Total $ 2,344 $ 47,351 $ 6,434 $ — $ 8,064 $ 15,376 $ 25,650 $ 105,219 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
90 NOTE 4 - RECEIVABLES
Receivables are presented on the Statement of Net Position as follows (in thousands):
Governmental
Activities
Business-Type
Activities Total
Accounts Receivables, Net $ 108,166 $ 89,378 $ 197,544
Restricted Interest Receivable — 465 465
Loans, Notes, Leases and Other Receivables, Net 75,321 15,376 90,697 Total $ 183,487 $ 105,219 $ 288,706
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
91 NOTE 4 - RECEIVABLES
Note 5. Property, Plant and Equipment - Capital Assets A. Citywide Capital Assets
The following is a summary of capital assets as of June 30, 2022 (in thousands):
Primary Government
Governmental
Activities
Business-Type
Activities
Fiduciary
Funds Total
Capital Assets Not Being Depreciated:
Land $ 270,918 $ 53,867 $ — $ 324,785
Intangibles (Indefinite Life) — 18,897 — 18,897
Construction in Progress 85,336 243,040 — 328,376
Total Capital Assets Not Being Depreciated 356,254 315,804 — 672,058 Capital Assets Being Depreciated:
Buildings and Improvements 346,036 1,505,044 — 1,851,080 Machinery and Equipment 184,421 102,881 2,978 290,280 Infrastructure 1,485,807 745,682 — 2,231,489
Total Capital Assets Being Depreciated 2,016,264 2,353,607 2,978 4,372,849 Less: Accumulated Depreciation for:
Buildings and Improvements (167,511) (657,712) — (825,223) Machinery and Equipment (118,439) (63,083) (2,014) (183,536) Infrastructure (1,088,092) (224,375) — (1,312,467)
Total Accumulated Depreciation (1,374,042) (945,170) (2,014) (2,321,226) Total Capital Assets Being Depreciated, Net 642,222 1,408,437 964 2,051,623 Total Capital Assets, Net $ 998,476 $ 1,724,241 $ 964 $ 2,723,681 Right to Use Assets Being Amortized
Land 1,273 209 — (63)
Buildings and Improvements 6,039 508 — (976)
Machinery and Equipment 1,962 — — (392)
Total Right to Use Assets Being Amortized 9,274 717 — 9,991 Less: Accumulated Amortization for:
Land (44) (19) — (63)
Buildings and Improvements (811) (165) — (976)
Machinery and Equipment (392) — — (392)
Total Accumulated Amortization (1,247) (184) — (1,431) Total Right to Use Assets, Net $ 8,027 $ 533 $ — $ 8,560 Total Capital and Right to Use Assets $ 1,006,503 $ 1,724,774 $ 964 $ 2,732,241 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
92 NOTE 5 - PROPERTY, PLANT & EQUIPMENT - CAPITAL ASSETS B. Governmental Activities
Capital asset activity related to governmental activities for the fiscal year ended June 30, 2022 was as follows (in thousands):
Beginning
Balance
as restated
Increases Transfers Decreases Ending
Balance
Capital Assets Not Being Depreciated:
Land $ 263,040 $ 7,878 $ — $ — $ 270,918
Construction in Progress 71,103 51,580 — (37,347) 85,336 Total Capital Assets Not Being Depreciated 334,143 59,458 — (37,347) 356,254 Capital Assets Being Depreciated:
Buildings and Improvements 307,178 46,992 (8,134) — 346,036 Machinery and Equipment 165,773 19,404 (682) (74) 184,421 Infrastructure 1,451,934 25,057 8,816 — 1,485,807
Total Capital Assets Being Depreciated 1,924,885 91,453 — (74) 2,016,264 Less: Accumulated Depreciation for:
Buildings and Improvements (162,229) (9,498) 4,216 — (167,511) Machinery and Equipment (104,901) (14,237) 625 74 (118,439) Infrastructure (1,049,826) (33,425) (4,841) — (1,088,092) Total Accumulated Depreciation (1,316,956) (57,160) — 74 (1,374,042) Total Capital Assets Being Depreciated, Net 607,929 34,293 — — 642,222 Total Capital Assets, Net $ 942,072 $ 93,751 $ — $ (37,347) $ 998,476 Right to Use Assets Being Amortized
Land 1,273 — — — 1,273
Buildings and Improvements 6,039 — — — 6,039
Machinery and Equipment 1,962 — — — 1,962
Total Right to Use Assets Being Amortized 9,274 — — — 9,274 Less: Accumulated Amortization for:
Land — (44) — — (44)
Buildings and Improvements — (811) — — (811)
Machinery and Equipment — (392) — — (392)
Total Accumulated Amortization — (1,247) — — (1,247) Total Right to Use Assets Being Amortized, Net $ 9,274 $ (1,247) $ — $ — $ 8,027 Total Capital and Right to Use Assets $ 951,346 $ 92,504 $ — $ (37,347) $ 1,006,503 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
93 NOTE 5 - PROPERTY, PLANT & EQUIPMENT - CAPITAL ASSETS Depreciation/Amortization was charged to functions as follows (in thousands):
Function Amount
General Government $ 13,503
Public Protection 4,688
Public Ways and Facilities 35,206
Culture and Recreation 4,242
Community Development 768
Total Governmental Activities Depreciation and
Amortization Expense $ 58,407
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
94 NOTE 5 - PROPERTY, PLANT & EQUIPMENT - CAPITAL ASSETS C. Business-Type Activities
Capital asset activity related to Business-Type Activities for the fiscal year ended June 30, 2022 was as follows (in thousands):
Beginning
Balance
as restated
Increases Transfers Decreases Ending
Balance
Capital Assets Not Being Depreciated:
Land $ 54,426 $ — $ (559) $ — $ 53,867
Intangibles (Indefinite Life) 17,949 389 559 — 18,897 Construction in Progress 408,819 44,741 — (210,520) 243,040 Total Capital Assets Not Being Depreciated 481,194 45,130 (210,520) 315,804 Capital Assets Being Depreciated:
Buildings and Improvements 1,041,179 4,016 459,849 — 1,505,044 Machinery and Equipment 94,579 7,691 611 — 102,881 Infrastructure 1,011,057 195,085 (460,460) — 745,682 Total Capital Assets Being Depreciated 2,146,815 206,792 — — 2,353,607 Less: Accumulated Depreciation for:
Buildings and Improvements (459,892) (46,939) (150,881) — (657,712) Machinery and Equipment (56,846) (5,688) (549) — (63,083) Infrastructure (350,722) (25,083) 151,430 — (224,375) Total Accumulated Depreciation (867,460) (77,710) — — (945,170) Total Capital Assets Being Depreciated, Net 1,279,355 129,082 — — 1,408,437 Total Capital Assets, Net $ 1,760,549 $ 174,212 $ — $ (210,520) $ 1,724,241 Right to Use Assets Being Amortized
Land 209 — — — 209
Buildings and Improvements 508 — — — 508
Machinery and Equipment — — — — —
Total Right to Use Assets Being Amortized 717 — — — 717 Less: Accumulated Amortization for:
Land — (19) — — (19)
Buildings and Improvements — (165) — — (165)
Machinery and Equipment — — — — —
Total Accumulated Amortization — (184) — — (184)
Total Right to Use Assets Being Amortized,
Net $ 717 $ (184) $ — $ — $ 533
Total Capital and Right to Use Assets $ 1,761,266 $ 174,028 $ — $ (210,520) $ 1,724,774 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
95 NOTE 5 - PROPERTY, PLANT & EQUIPMENT - CAPITAL ASSETS Depreciation/Amortization was charged to functions as follows (in thousands):
Function Amount
Water System $ 29,525
Sewer System 25,188
Solid Waste Management 531
Transit 7,435
Airports 11,729
Fresno Convention Center 2,023
Stadium 1,275
Other Enterprise Funds 188
Total Business-Type Activities Depreciation and
Amortization Expense $ 77,894
D. Fiduciary Funds
Capital asset activity related to fiduciary funds for the fiscal year ended June 30, 2022 was as follows (in thousands):
Beginning
Balance Increases Transfers Decreases Ending
Balance
Capital Assets Being Depreciated:
Machinery and Equipment $ 2,850 $ 128 $ — $ — $ 2,978
Less: Accumulated Depreciation for:
Machinery and Equipment (1,742) (272) — (2,014)
Total Capital Assets Being Depreciated, Net 1,108 (144) — — 964 Total Capital Assets, Net $ 1,108 $ (144) $ — $ — $ 964 Depreciation was charged to functions as follows (in thousands):
Function Amount
Fire & Police Retirement System Pension Trust Funds $ 136 Employee Retirement System Pension Trust Funds 136
Total Fiduciary Activities Depreciation Expense $ 272
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
96 NOTE 5 - PROPERTY, PLANT & EQUIPMENT - CAPITAL ASSETS E. Construction in Progress
At June 30, 2022, Construction in Progress consisted of the following (in thousands):
Project Title Construction Costs
To Date*
Governmental Activities:
Bike/Trail Projects $ 294
Neighborhood Improvements 1,775
Public Works Projects 47,919
Parks General Improvements 575
Fire Station Construction Projects 7,516
Other Miscellaneous Projects 27,257
Total Governmental Activities $ 85,336
Business-Type Activities:
Water Capital Projects $ 139,450
Sewer/Wastewater/Solid Waste Capital Projects 43,400
Airports Capital Projects 45,166
Transit Capital Projects 12,951
Miscellaneous Projects 2,073
Total Business-Type Activities $ 243,040
Total Construction in Progress $ 328,376
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
97 NOTE 5 - PROPERTY, PLANT & EQUIPMENT - CAPITAL ASSETS Note 6. Leases
A. Leases
The City has adopted the following policies to account for agreements in accordance with the requirements of GASB 87. The primary objective of this statement is to enhance the relevance and consistency of information about governments' leasing activities. This statement establishes a single model for lease accounting based on the principle that leases are financings of the right-to-use an underlying asset. Under this Statement, a lessee is required to recognize a lease liability and intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources.
B. Basis of Lease Classification
In accordance with GASB No. 87, the City does not recognize a lease receivable and a deferred inflow of resources for short-term leases. Short-term leases are certain leases that, at the commencement of the lease term, has a maximum possible term under the lease contract of 12 months or less, including any options to extend, regardless of their probability of being exercised. The City, being a lessee and lessor, recognizes short-term lease payments as outflows of resources (expenditures) or inflows of resources (revenue), respectively, based on the payment provisions of the lease contract.
C. Term
At the time of lease commencement or conversion, the term of the lease will include possible extension periods that are deemed to be reasonably certain given all available information, regarding the likelihood of renewal.
D. Discount Rate
Unless explicitly stated in the lease agreement, known by the City, or the City is able to determine the rate implicit within the lease, the discount rate used to calculate lease right-to-use assets and liabilities and related lease receivable is the City’s incremental borrowing rate at the end of each fiscal year. As of June 30, 2022, the City's incremental borrowing rate was 2.21%. This was the discount rate utilized for applicable leases reported in fiscal year 2022.
E. Variable Payments
Variable payments based on the future performance of the lessee or lessor or usage of the underlying asset are not included in the measurement of lease assets or liabilities.
F. The City of Fresno as Lessee
The City, as lessee, has entered into various agreements for land and buildings with lease terms expiring between 2022 and 2053, with some leases containing options to renew. The terms and conditions for these leases vary by the type of underlying asset. All these agreements have fixed, periodic payments over the lease term, and do not contain variable payments or guaranteed residual CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 98 Note 6 - Leases values in the lease agreements. For those agreements that are cancellable by the lessors or the City with an advance notice, they are considered as non-cancellable in accordance with GASB Statement No. 87. In accordance with GASB No. 87, as lessee, the City recognized $1.4 million of amortization expense in the year ended June 30, 2022. More information on the value of leased assets and their associated amortization can be found in Note 5, beginning on page 93.
Future payments, under these non-regulated leases for each of the next five years and in five- year increments thereafter are as follows (amounts in thousands):
Beginning Balance Payments Interest Ending Balance
2023 $ 8,688 $ 1,518 $ 178 $ 7,348
2024 7,348 1,448 148 6,048
2025 6,048 1,220 122 4,951
2026 4,950 1,179 98 3,869
2027 3,869 747 79 3,200
2028-2032 3,200 2,425 225 1,001
2033-2037 1,001 395 90 695
2038-2042 695 313 63 445
2043-2047 445 313 34 167
2048-2052 167 172 5 —
G. The City of Fresno as Lessor
The City, as a lessor, recognizes a lease receivable and a deferred inflow of resources at the commencement of the lease term, with certain exceptions for regulated leases and short-term leases. As lessor, the asset underlying the lease is not derecognized. The lease receivable is measured at the present value of the lease payments expected to be received during the lease term.
The leases typically include provisions for rent changes based on the consumer price index or other market indexes, resulting in additional variable lease revenues that are not included in the measurement of the lease receivables. These variable payments based on index are considered to be 'fixed in substance' and are included in the calculation of the lease receivable. The deferred inflow of resources is measured at the value of the lease receivable in addition to any payments received at or before the commencement of the lease term that relate to future periods.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 99 Note 6 - Leases Future receipts, under these non-regulated leases for each of the next five years and in five- year increments thereafter are as follows (amounts in thousands):
Beginning Balance Lease Receipt Interest Income Ending Balance 2023 $ 26,427 $ 5,181 $ 518 $ 21,765
2024 21,765 5,192 415 16,987
2025 16,987 2,410 337 14,915
2026 14,915 1,720 304 13,499
2027 13,499 1,679 274 12,095
28-32 12,095 5,455 1,022 7,662
33-37 7,662 4,170 642 4,134
38-42 4,134 2,567 332 1,899
43-47 1,899 1,320 107 508
48-52 508 471 30 67
53-57 67 68 1 —
H. Regulated Leases
In accordance with GASB Statement No. 87, The City does not recognize a lease receivable and a deferred inflow of resources for regulated leases. Regulated leases are certain leases that are subject to external laws, regulations, or legal rulings, e.g. the U.S. Department of Transportation and the Federal Aviation Administration, regulated aviation leases between airports and air carriers and other aeronautical users.
During the year ended June 30, 2022, the City recognized the following related to its regulated lease agreements:
Regulated – Hangar Rentals (Fixed)
Lease revenue $2,161,472 Revenue from variable payments excluded from the
schedule of expected future minimum payments $36,277 Future expected minimum payments related to the City’s regulated leases at June 30, 2022 are as follows:
Regulated – Hanger Rentals (Fixed)
Principal Interest Total
2023 $ 1,828 $ — $ 1,828
2024 1,613 — 1,613
2025 1,599 — 1,599
2026 1,590 — 1,590
2027 3,989 — 3,989
2028 701 — 701
2029 85 — 85
Report Total $ 13,424 $ — $ 13,424
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 100 Note 6 - Leases Note 7. Long-Term Liabilities
A. Summary of Long-Term Liabilities
The following is a summary of the City's Long-Term Liabilities as of June 30, 2022 (in thousands):
Primary Government
Governmental
Activities
Business-Type
Activities
Fiduciary
Funds
Total Primary
Government
Long-Term Debt
Revenue and Other Bonds $ 196,090 $ 170,220 $ — $ 366,310 Bonds From Direct Placements — 33,464 — 33,464
Tax Allocation Bonds — — 418 418
Notes Payable From Direct Borrowings 1,440 425,341 1,137 427,918 Subtotal Net Principal Due 197,530 629,025 1,555 828,110 Accreted Interest — 3,078 — 3,078
Issuance Premiums (Discounts) 8,712 1,259 (1) 9,970 Subtotal Accreted Interest, Issuance Prem/(Disc) 8,712 4,337 (1) 13,048 Capital Financing Activities 52,568 — — 52,568
Total Long-Term Debt 258,810 633,362 1,554 893,726
Other Long-Term Liabilities
Retention Payable 3,460 — — 3,460
Compensated Absences and Health Retirement
Arrangement (HRA) 84,121 13,883 56 98,060
Net OPEB Liability 71,680 28,080 — 99,760
Liabilities for Self-Insurance 207,927 — — 207,927
CVP Litigation Settlement — 127 — 127
Accrued Closure Cost — 11,174 — 11,174
Pollution Remediation — 407 — 407
Operating Leases 8,149 539 8,688
Total Other Long-Term Liabilities 375,337 54,210 56 429,603 Total Long-Term Liabilities Government-Wide
Statement of Net Position $ 634,147 $ 687,572 $ 1,610 $ 1,323,329 Due Within One Year $ 82,890 $ 24,902 $ 512 $ 108,304
Due Within More Than One Year 551,257 662,670 1,098 1,215,025 Total Long-Term Liabilities Government-Wide
Statement of Net Position $ 634,147 $ 687,572 $ 1,610 $ 1,323,329
Internal service funds (ISFs), except for Utility Billing and Collection, primarily serve the governmental funds. Accordingly, Long-Term Liabilities for ISFs are included as part of the above totals for governmental activities, while the long-term liabilities for Utility Billing and Collection are included as part of the totals for Business-Type Activities. Governmental Activities also reflect compensated absences which are generally liquidated by the General Fund, claims/judgments which are liquidated by Risk Management and the Employees Healthcare Plan, and net OPEB liability which is liquidated by the Employees Healthcare Plan.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
101 NOTE 7 - LONG-TERM LIABILITIES Activity of Long-Term Liabilities - Governmental (In Thousands) Beginning
Balance
as restated Additions Reductions
Ending
Balance
Due Within
One Year
Governmental Activities:
Bonds Payable (Revenue and Other Bonds):
Lease Revenue Bonds, Series 2004 $ 10,625 $ — $ 935 $ 9,690 $ 990 Taxable Pension Obligation Bonds Refunding
Series 2002 98,395 — 9,755 88,640 10,385
Lease Revenue Bonds 2017A, City Hall Refunding,
Fresno Bee Building, Granite Park, Improvements 19,240 — 1,645 17,595 1,690 Lease Revenue Bonds, Series 2017A, City Hall
Chiller 2,710 — — 2,710 610
Lease Revenue Bonds, Series 2017A Parks
Projects 20,775 — 805 19,970 845
Lease Revenue Bonds, Series 2017A&B, NNLB 5,535 — 2,705 2,830 2,830 Lease Revenue Bonds, Series 2017A, Police and
Fire/Public Safety 28,875 — 1,170 27,705 1,230
Lease Revenue Bonds, Series 2017A, Various 10,785 — 605 10,180 635 Lease Revenue Bonds, Series 2020A, Animal Svcs 17,145 — 375 16,770 395 Total Revenue and Other Bonds 214,085 — 17,995 196,090 19,610 Less: Unamortized Amounts:
For Issuance Premiums/(Discounts) 9,774 — 1,062 8,712 — Notes Payable From Direct Borrowings:
California Infrastructure Bank - City 1,397 — 87 1,310 90 HUD Sec 108 Note Neighborhood Streets/Parks 251 — 121 130 130 Total Notes Payable From Direct Borrowings 1,648 — 208 1,440 220 Capital Financing Activities 41,153 20,827 9,412 52,568 9,654 Total Long-Term Debt 266,660 20,827 28,677 258,810 29,484 Other Liabilities:
Retention Payable 2,358 1,102 — 3,460 3,460
Compensated Absences and Health Retirement
Arrangement 70,378 25,791 12,049 84,120 11,042
Net OPEB Liability 108,178 — 36,498 71,680 —
Liability for Self-Insurance 192,233 95,695 80,001 207,927 37,746 Operating Leases 9,275 — 1,126 8,149 1,158
Total Other Liabilities 382,422 122,588 128,548 367,187 53,406 Governmental Long-Term Liabilities Total $ 649,082 $ 143,415 $ 157,225 $ 625,997 $ 82,890 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
102 NOTE 7 - LONG-TERM LIABILITIES Activity of Long-Term Liabilities - Business-Type (In Thousands) Beginning
Balance
as restated Additions Reductions
Ending
Balance
Due Within
One Year
Business-Type Activities:
Bonds Payable (Revenue and Other Bonds):
Water System Revenue Bonds 2010 $ 91,340 $ — $ — $ 91,340 $ — Sewer System Revenue Bonds 1993 A 885 — — 885 885
Lease Revenue Bonds 1998 - Exhibit Hall Expansion 1,569 — 234 1,335 222 Airport Revenue Refunding Bonds 2013 23,515 — 1,670 21,845 1,750 Lease Revenue Bonds 2001 A and B - Stadium 12,750 — 925 11,825 985 Airport Revenue Bonds 2007 - Cons. Rental Car 20,385 — 435 19,950 500 Lease Revenue Bonds 2008 - Convention Center 3,545 — 2,175 1,370 1,370 Lease Revenue Bonds 2017A - Exhibit Hall Expansion 9,060 — 950 8,110 1,000 Lease Revenue Bonds 2017A - Convention Center 2,880 — 425 2,455 445 Lease Revenue Bonds 2017A - Stadium 10,550 — 845 9,705 885 Lease Revenue Bonds 2017A - Riverside Golf Course 1,455 — 55 1,400 60 Total Revenue and Other Bonds 177,934 — 7,714 170,220 8,102 Bonds Payable From Direct Placements:
Airport Revenue Bonds 2019 - Airport Parking 34,244 — 780 33,464 804 Plus Accreted Interest:
Accreted Interest on Capital Appreciation Bonds 3,355 239 516 3,078 — Less: Unamortized Amounts
For Issuance Premiums/(Discounts) 1,693 — 434 1,259 — Notes Payable From Direct Borrowings:
Construction of Water Supply Disinfection Buildings 1,133 — 96 1,037 99 Improvements on the Enterprise and Jefferson Canals 724 — 62 662 63 Water Meter Project 33,414 — 2,571 30,843 2,570
Southeast Surface Water Treatment Facility 163,753 — 4,740 159,013 4,820 Tertiary Treatment Facility 28,336 — 1,003 27,333 1,013 Enterprise Canal Raw Water Pipeline 19,693 — 588 19,105 598 Regional Transmission Mains 64,787 — 1,810 62,977 1,839 Kings River Pipeline 53,187 10 1,590 51,607 1,615
Southwest Quadrant Recycled Water Dist. System 59,525 8,798 — 68,323 — Northeast Surface Water Treatment Facility — 4,520 79 4,441 — Total Notes Payable From Direct Borrowings 424,552 13,328 12,539 425,341 12,617 Total Long-Term Debt 641,778 13,567 21,983 633,362 21,523 Other Long-Term Liabilities:
Compensated Absences & Health Retirement
Arrangement 13,530 3,151 2,798 13,883 2,397
Net OPEB Liability 44,426 — 16,346 28,080 —
CVP Litigation Settlement 113 14 — 127 —
Accrued Closure Cost 12,104 — 930 11,174 800
Pollution Remediation 452 — 45 407 —
Operating Leases 716 — 177 539 182
Total Other Long-Term Liabilities 71,341 3,165 20,296 54,210 3,379 Business-Type Long-Term Liabilities Total $ 713,119 $ 16,732 $ 42,279 $ 687,572 $ 24,902 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
103 NOTE 7 - LONG-TERM LIABILITIES Activity of Long-Term Liabilities - Fiduciary (In Thousands) Beginning
Balance Additions Reductions
Ending
Balance
Due Within
One Year
Fiduciary Funds:
Successor Agency to the Fresno
Redevelopment Agency:
Tax Allocation Bonds:
Series 2003, Mariposa Project Area $ 815 $ — $ 397 $ 418 $ 418 Total Tax Allocation Bonds 815 — 397 418 418
Less: Unamortized Amounts:
For Issuance Premiums/(Discounts) (1) — 1 — —
Total Unamortized Amounts (1) — 1 — —
Notes Payable From Direct Borrowings:
California Infrastructure Bank 1,212 — 75 1,137 78 Total Notes Payable From Direct Borrowings 1,212 — 75 1,137 78 Total Long-Term Debt 2,026 — 473 1,555 496
Other Liabilities:
Compensated Absences 56 14 15 55 16
Total Other Long-Term Liabilities 56 14 15 55 16
Fiduciary Funds Long-Term Liabilities Total $ 2,082 $ 14 $ 488 $ 1,610 $ 512 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
104 NOTE 7 - LONG-TERM LIABILITIES The following is a description of Long-Term Debt, Excluding Capital Financing Obligations, which had activity in 2022 (in thousands):
Governmental
Revenue and Other Bonds
Taxable Pension
Obligation Bonds 2002
$205,335
taxable
Refund 2000
Taxable Pension
Obligation Bonds
6.55% 2/21/2002 6/1/2029 Repayment of bonds not limited to any special source of City funds. Principal due annually, interest due
semiannually. City uses funds throughout the City based on full-time employees assigned to funds. For the General Fund, the City uses dedicated Property Tax Override
(PTO) revenue first, and then other General Fund
revenues to make its portion of the bond payment. Other citywide revenues make up the difference between total
debt service and the General Fund portion. During 2022 $14,033 of PTO revenue was used. In addition to PTO
revenue, $0 of General Fund and $2,158 of Enterprise
Fund/Internal Service Fund revenues were used to make
the 2022 debt service payment of $16,191.
$10,385 to
$15,195
$ 88,640 $ 0 $ 88,640 $ 113,332 $ 16,191
Fresno Joint Powers
Financing Authority:
Lease Revenue
Refunding Bonds 2017
A&B, No Neighborhood
Left Behind (NNLB)
A = $11,010
tax-exempt; B
= $1,940
taxable
Refinance No
Neighborhood Left
Behind Projects
3.18% to
5.00%
5/10/2017 4/1/2023 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. Lease revenue of $2,966 was equal to debt service in 2022.
$2,830 2,905 (75) 2,830 2,964 2,966
Fresno Joint Powers
Financing Authority:
Lease Revenue
Refunding Bonds
(Chiller) 2017 A, City Hall
Chiller
A = $2,710
tax-exempt
Refinance City Hall
Chiller
5.000% 5/10/2017 4/1/2024 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. Lease revenue of $136 was equal to debt
service in 2022.
$610 to
$2,100
2,838 (128) 2,710 2,951 136
Fresno Joint Powers
Financing Authority:
Lease Financing
Refunding 2017 A&B,
City Hall, Garage #7,
Bee Bldg & Granite Park
A = $10,125
tax-exempt; B
= $21,980
taxable
Refinance City Hall,
Parking Garage #7,
Fresno Bee Building
and Granite Park
3.18% to
4.16%
5/10/2017 4/1/2031 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. Lease revenue of $2,364 was equal to debt service in 2022.
$1,690 to
$2,270
17,595 0 17,595 21,273 2,364
Fresno Joint Powers
Financing Authority:
Lease Revenue
Refunding Bonds 2017
A, Various Capital
Projects
A = $12,435
tax-exempt
Refinance Various
Capital
Improvement
Projects
5.000% 5/10/2017 4/1/2035 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. Lease revenue of $1,144 was equal to debt service in 2022.
$40 to $1,785 11,342 (1,162) 10,180 14,917 1,144
Fresno Joint Powers
Financing Authority:
Lease Revenue Bonds
2004 A,B,C, Various
Capital Projects
A = $15,810
tax-exempt; B
= $8,100 tax-
exempt; C =
$28,870
taxable
Calcot Project, Fire
Department
Projects, Downtown
Parking Projects,
Santa Fe Depot
Project, Roeding
Business Park
Project Area, other
capital projects
5.900% 4/28/2004 10/1/2034 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. Lease revenue of $1,534 was equal to debt service in 2022.
$990 to
$1,400
9,697 (7) 9,690 12,132 1,534
Fresno Joint Powers
Financing Authority:
Lease Revenue
Refunding Bonds (Parks
Projects) 2017 A, Parks
Impact Fee Projects
A = $22,965
tax-exempt
Refinance
Improvements to
Various Park
Facilities
5.000% 5/10/2017 4/1/2038 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. Lease revenue of $1,822 was equal to debt service in 2022.
$845 to
$1,755
22,072 (2,102) 19,970 29,131 1,822
Fresno Joint Powers
Financing Authority:
Lease Revenue
Refunding Bonds 2017
A, Police and Fire/Public
Safety
A = $32,065
tax-exempt
Refinance Public
Safety Capital
Improvement
Projects (Police &
Fire)
5.000% 5/10/2017 4/1/2039 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. Lease revenue of $2,557 was equal to debt service in 2022.
$1,115 to
$2,300
30,431 (2,726) 27,705 40,750 2,557
Series Purpose
Rate
Range Issue Date
Maturity
Date Note
Annual
Principal
Outstanding
Principal
Issuance
Disc/(Prem)
Accreted Int
Net Principal
Due
Payments to
Maturity
Fiscal Year
2022 Debt
Service
Payment
105 NOTE 7 - LONG-TERM LIABILITIES Fresno Joint Powers
Financing Authority:
Lease Revenue Bonds
2020 A, Animal Services
Facility
A =
$17,145,000
tax-exempt
Animal Services
Facility
4.00% to
5.00%
11/3/2020 4/1/2046 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. Lease revenue of $1,120 was equal to debt service in 2022.
$395 to
$1,075
$ 19,282 $ (2,512) $ 16,770 $ 26,874 $ 1,120
Revenue and Other Bonds Total $ 204,802 $ (8,712) $ 196,090 $ 264,324 $ 29,834 Notes Payable
HUD: Neighborhood
Streets/Parks
$1,500
Loaned
Section 108 Note to
be used for
improvements to
various
neighborhood
streets & parks
6.12% 8/8/2002 8/1/2022 Annual principal payments, semiannual interest payments. $121 to $130 $ 130 $ 0 $ 130 $ 134 $ 133 Roeding Business Park $2,441
Loaned
Loaned from the
California
Infrastructure and
Economic
Development Bank
to be used to
complete the
Roeding Business
Park
3.53% 3/18/2004 8/1/2033 Secured by Facility Lease on City Hall Annex. Annual principal payments, semiannual interest payments.
$87 to $131 1,310 0 1,310 1,607 134
Notes Payable Total $ 1,440 $ 0 $ 1,440 $ 1,741 $ 267
Governmental Total $ 206,242 $ (8,712) $ 197,530 $ 266,065 $ 30,101 Business-Type
Revenue and Other Bonds
Water System Revenue
Bonds (Taxable Build
America Bonds) 2010
A-2, Water
A-2 = $91,340
taxable
Improvements to
the Water System
6.50% to
6.75%
2/3/2010 6/1/2040 Repayment of bonds solely from revenues derived from the operation of the City Water System, except connection fees and charges, refundable deposits and capital
contributions. Principal payable annually, interest
semiannually. During Fiscal Year 2022, a federal Build
America Bonds subsidy of $2,017 was received.
$4,090 to
$7,715
$ 90,329 $ 1,011 $ 91,340 $ 161,213 $ 6,097
Sewer System Revenue
Bonds 1993 A
A = $196,280
tax-exempt
Rehabilitation and
expansion of the
City's Wastewater
Treatment Facility
4.50% 10/6/1993 9/1/2023 Repayment of bonds solely from revenues derived from the operation of the City Sewer System, except connection fees and charges, refundable deposits and capital
contributions. Principal payable annually, interest
semiannually.
$885 885 0 885 905 40
Fresno Joint Powers
Financing Authority:
Lease Revenue
Refunding Bonds 2017
A, Convention Center
A = $4,260
tax-exempt
Refinance
Convention Center
Improvement
Projects (Phase I)
5.00% 5/10/2017 4/1/2027 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. During 2022 the City chose to make these
lease payments from the General Fund in the amount of
$569, which was equal to debt service in 2022. While the City has the right to use any unencumbered funding
source it wishes to use for future lease payments, it is anticipated that General Fund revenues will be used to
make these future payments, which the Authority will then use to make the debt service payment.
$445 to $540 2,649 (194) 2,455 2,835 569
Fresno Joint Powers
Financing Authority:
Lease Revenue Bonds
(Conv. Ctr.) 2008 F,
Convention Center
F = $21,410
taxable
Refund a portion of
2006 Convention
Center Bonds &
finance various
Convention Center
improvements
6.70% 8/14/2008 4/1/2023 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. During 2022, the City chose to make these lease payments from the General Fund in the amount of
$2,413, which was equal to debt service in 2022. While the City has the right to use any unencumbered funding
source it wishes to use for future lease payments, it is anticipated that General Fund revenues will be used to
make these future payments, which the Authority will then use to make the debt service payment.
$1,370 1,369 1 1,370 1,462 2,413
Series Purpose
Rate
Range Issue Date
Maturity
Date Note
Annual
Principal
Outstanding
Principal
Issuance
Disc/(Prem)
Accreted Int
Net Principal
Due
Payments to
Maturity
Fiscal Year
2022 Debt
Service
Payment
106 NOTE 7 - LONG-TERM LIABILITIES Fresno Joint Powers
Financing Authority:
Lease Revenue
Refunding Bonds 2017
A, Exhibit Hall Expansion
Project Refunding
A = $11,665
tax-exempt
Refinance Exhibit
Hall Expansion
Project
5.00% 5/10/2017 4/1/2029 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. Lease revenue of $1,403, which was equal to debt service in 2022. While the City has the right to use any unencumbered funding source it wishes to use for
future lease payments, it is anticipated that General Fund revenues will be used to make these future payments,
which the Authority will then use to make the debt service payment.
$1,000 to
$1,330
$ 8,869 $ (759) $ 8,110 $ 9,809 $ 1,403
Fresno Joint Powers
Financing Authority:
Lease Revenue Bonds
1998, Exhibit Hall
Expansion Project
$32,610 tax-
exempt
Construction of an
Exhibit Hall
N/A 9/1/1998 9/1/2028 Current Interest Serial Bonds ($25,395) and Capital Appreciation Serial Bonds ($7,215). Repayment payable
solely by revenues pledged in trust agreement, primarily Base Rental Payments pursuant to a Facilities Lease.
Principal due annually, Interest due semiannually. During 2022, the City chose to make these lease payments from
the General Fund in the amount of $750, which was equal to the debt service payment. All remaining bonds are
Capital Appreciation Bonds, so interest is accreted. While the City has the right to use any unencumbered funding
source it wishes to use for future lease payments, it is anticipated that General Fund revenues will be used to
make future lease payments, which the Authority will then use to make the debt service payment.
$162 to $222 4,368 (3,033) 1,335 5,250 750
Fresno Joint Powers
Financing Authority:
Lease Revenue
Refunding Bonds 2017
A, Stadium Project
A = $13,510
tax-exempt
Refinance
MultiPurpose
Stadium Project
5.00% 5/10/2017 4/1/2031 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. During 2022, the City chose to make these lease payments from the General Fund in the amount of
$1,373, which was equal to the debt service payment.
While the City has the right to use any unencumbered
funding source it wishes to use for future lease payments, it is anticipated that General Fund revenues will be used to make future lease payments, which the Authority will then use to make the debt service payment.
$885 to
$1,300
10,708 (1,003) 9,705 12,287 1,373
Fresno Joint Powers
Financing Authority:
Lease Revenue Bonds
2001 A & B, Stadium
Project
A = $23,615
tax-exempt; B
= $22,235
taxable
Acquire and
construct a
MultiPurpose
Outdoor Stadium
6.93% to
7.03%
6/12/2001 6/1/2031 Repayment payable solely by revenues pledged in trust agreement, primarily Base Rental Payments pursuant to a Facilities Lease. Principal due annually, interest due
semiannually. During 2022, the City chose to make these lease payments from the General Fund in the amount of
$1,819, which was equal to the debt service payment.
While the City has the right to use any unencumbered
funding source it wishes to use for future lease payments, it is anticipated that General Fund revenues will be used to make future lease payments, which the Authority will then use to make the debt service payment.
$985 to
$1,700
11,836 (11) 11,825 16,355 1,819
Fresno Joint Powers
Financing Authority:
Lease Revenue
Refunding Bonds
(Riverside Golf Course)
2017 A, Riverside Golf
Course
A = $1,615
tax-exempt
Refinance
Improvements to
Riverside Golf
Course
5.00% 5/10/2017 4/1/2038 Repayment payable solely by revenues pledged under Master Facilities Sublease agreement, primarily Base
Rental Payments. Principal due annually, interest due
semiannually. During 2022, the City chose to make these lease payments from the General Fund in the amount of
$126, which was equal to the debt service payment. While the City has the right to use any unencumbered funding
source it wishes to use for future lease payments, it is anticipated that General Fund revenues will be used to
make future lease payments, which the Authority will then use to make the debt service payment.
$60 to $125 1,548 (148) 1,400 2,040 126
Airport Revenue
Refunding Bonds 2013,
Concourse Expansion
A = $10,810
Non-AMT; B =
$22,820 AMT
(Subject to
Alternative
Minimum Tax)
Refund 2000 Airport
Revenue Bonds
4.00% to
5.125%
8/6/2013 7/1/2030 Repayment of bonds solely from operation of the City Airport System. Bond Indenture requires a minimum
$1,600 of PFC Contribution toward annual debt service
from Passenger Facility Charges (PFC). During Fiscal Year 2022 $1,600 of PFC and $1,163 of eligible Airports
operation revenues were used to make the debt service
payment.
$1,750 to
$5,335
22,045 (200) 21,845 27,497 2,763
Series Purpose
Rate
Range Issue Date
Maturity
Date Note
Annual
Principal
Outstanding
Principal
Issuance
Disc/(Prem)
Accreted Int
Net Principal
Due
Payments to
Maturity
Fiscal Year
2022 Debt
Service
Payment
107 NOTE 7 - LONG-TERM LIABILITIES Airport Revenue Bonds
2007, Consolidated
Rental Car Facility
$22,000
taxable
Construction of a
Consolidated Rental
Car Facility and
related
improvements
5.83% 6/14/2007 7/1/2037 Repayment of bonds solely from operation of the City Airport System. While not required under the Bond
Indenture, Airports uses Customer Facility Charge (CFC) revenues first to meet the debt payment, and then uses
other permitted revenues to cover any difference between CFC's and the debt payment. Principal due annually,
interest due semiannually. During Fiscal Year 2022 $1,611 of CFC revenues was used to fully cover the debt service payment.
$500 to
$2,265
$ 19,950 $ 0 $ 19,950 $ 31,566 $ 1,611
Airport Revenue Bonds
2019, Airport Parking
$35,000
taxable
Construction of a
Parking Garage
3.450% 5/3/2019 7/1/2048 Bonds privately placed with the California Infrastructure and Development Bank (I-Bank). Interest rate includes
3.15% charged by the I-Bank for interest plus 0.30%
charged by the I-Bank as a fee. Repayment of bonds
solely from operation of the City Airport System. Principal due annually, interest due semiannually.
$804 to
$1,802
33,464 0 33,464 51,197 1,948
Revenue and Other Bonds Total $ 208,020 $ (4,336) $ 203,684 $ 322,416 $ 20,912 Notes Payable
Water: Safe-Drinking
Water Program
$51,405
Loaned
Contract between
the State Water
Resources Control
Board and the City
for installation of
water meters
throughout the City
of Fresno
0.00% 4/10/2012 10/1/2022 No interest loan. Repayment of the loan is funded from revenues of the Water Fund. Pledged in parity with the
pledges securing the 2010 Bonds and other State loans for Water. Principal due in semiannual installments of $1,285. $2,570 $ 30,843 $ 0 $ 30,843 $ 30,843 $ 2,570
Water: Safe Drinking
Water Program
$1,947
Loaned
Contract between
the State Water
Resources Control
Board and the City
to protect the City's
drinking water
supplies from
Possible
Contaminating
Activities (PCA's)
2.29% 7/1/2009 7/1/2031 Repayment of loan is funded from revenues of the Water Fund. Pledged in parity with the pledges securing the
2010 Bonds and other State loans for Water. Principal and interest due in semiannual installments of $61.
$61 to $119 1,037 0 1,037 1,160 122
Water: Safe Drinking
Water Program
$1,245
Loaned
Contract between
the State Water
Resources Control
Board and the City
for improvements
on the Enterprise
and Jefferson
Canals
2.29% 7/1/2009 1/1/2032 Repayment of loan is funded from revenues of the Water Fund. Pledged in parity with the pledges securing the
2010 Bonds and other State loans for Water. Principal and interest due in semiannual installments of $39.
$39 to $76 662 0 662 741 78
Water: Drinking Water
State Revolving Fund
Project 1010007-029C
$26,520
Loaned
Contract between
the State Water
Resources Control
Board and the City
for construction of
the Friant-Kern
Canal Raw Water
Pipeline
1.60% 4/5/2016 7/1/2048 Repayment of loan is funded from the revenues of the Water Fund. Pledged in parity with the pledges securing the 2010 Bonds and other State loans for Water. Principal and interest due in semiannual installments of $451.
$588 to $889 19,105 0 19,105 23,258 901
Water: Drinking Water
State Revolving Fund
Project 1010007-028C
$195,489
Loaned
Contract between
the State Water
Resources Control
Board and the City
for construction of a
Southeast Surface
Water Treatment
Facility
1.66% 7/15/2015 1/1/2049 Repayment of loan is funded from the revenues of the Water Fund. Pledged in parity with the pledges securing the 2010 Bonds and other State loans for Water. Principal and interest due in semiannual installments of $3,631. $3 million of the loan was forgiven by the State Water
Resources Control Board.
$3,691 to
$7,292
159,013 0 159,013 187,065 7,444
Series Purpose
Rate
Range Issue Date
Maturity
Date Note
Annual
Principal
Outstanding
Principal
Issuance
Disc/(Prem)
Accreted Int
Net Principal
Due
Payments to
Maturity
Fiscal Year
2022 Debt
Service
Payment
108 NOTE 7 - LONG-TERM LIABILITIES Water: Drinking Water
State Revolving Fund
Project 1010007-030C
$75,900
Loaned
Contract between
the State Water
Resources Control
Board and the City
for construction of a
raw water pipeline
to replace the
Enterprise Canal for
the Northeast
Surface Water
Treatment Facility
1.60% 8/23/2016 1/1/2049 Repayment of loan is funded from the revenues of the Water Fund. Pledged in parity with the pledges securing the 2010 Bonds and other State loans for Water. Principal and interest due in semiannual installments $1,413.
$1,409 to
$2,784
$ 62,977 $ 0 $ 62,977 $ 61,916 $ 2,840
Water: Drinking Water
State Revolving Fund
Project 1010007-031C
$65,876
Loaned
Contract between
the State Water
Resources Control
Board and the City
for construction of a
Kings River Pipeline
1.60% 4/5/2016 7/1/2048 Repayment of loan is funded from the revenues of the Water Fund. Pledged in parity with the pledges securing the 2010 Bonds and other State loans for Water. Principal and interest due in semiannual installments of $1,217.
$1,589 to
$2,415
51,607 0 51,607 56,859 2,434
Water: Drinking Water
State Revolving Fund
Project 1010007-032C
$14,000
Loaned
Contract between
the State Water
Resources Control
Board and the City
for construction of a
Northeast Surface
Water Treatment
Facility
1.80% 11/26/2016 1/1/2051 Repayment of loan is funded from the revenues of the Water Fund. Pledged in parity with the pledges securing the 2010 Bonds and other State loans for Water. Project is not yet complete.Principal and interest due in semiannual installments to begin once project is completed and
continue for 30 years. Until completion, interest is due semiannually on the amount drawn down through the
interest payment date.
No amortiza-
tion schedule
available until
project is
complete.
4,441 0 4,441 4,441 100
Sewer: Clean Water
State Revolving Fund
Project
$33,213
Loaned
Contract between
the State Water
Resources Control
Board and the City
for construction of a
tertiary treatment
facility
1.00% 10/17/2015 7/12/2046 Repayment of loan solely from all revenues derived from the operation of the City Sewer System, except connection fees and charges, refundable deposits and capital
contributions. Pledged subordinate to the pledge securing the 1993 Bonds and in parity with State loans for Sewer.
Principal and interest due in annual installments of $1,286. $1,003 to
$1,282
27,333 0 27,333 30,881 1,286
Sewer: Clean Water
State Revolving Fund
Project No. 8061-110
$70,600
Loaned
Contract between
the State Water
Resources Control
Board and the City
for construction of a
recycled water
distribution system
in the southwest
quadrant of the City
1.00% 8/19/2015 5/30/2047 Repayment of loan solely from all revenues derived from the operation of the City Sewer System, except connection fees and charges, refundable deposits and capital
contributions. Pledged subordinate to the pledge securing the 1993 Bonds, and in parity with State loans for Sewer.
Principal and interest due in semiannual installments to begin once project is completed and continue for 30 years.
Until completion, interest is due semiannually on the
amount drawn down through the interest payment date.
No amortiza-
tion schedule
available until
project is
complete.
68,323 0 68,323 68,323 0
Notes Payable Total $ 425,341 $ 0 $ 425,341 $ 465,487 $ 17,775 Business-Type Total $ 633,361 $ (4,336) $ 629,025 $ 787,903 $ 38,687 Fiduciary
Tax Allocation Bonds
Tax Allocation Refunding
Bonds 2003, Mariposa
Project Area
$5,005 tax-
exempt
Refund the
Agency's 1993 Tax
Allocation Bonds
(Mariposa Project
Area)
5.625% 2/1/2012 2/1/2023 Principal is due in annual installments, interest is due semiannually. Repayment of bonds is payable solely from tax increment revenues allocated by the Successor
Agency to the City of Fresno Redevelopment Agency's
Mariposa Project area. All such revenues are pledged. Tax increment in Mariposa Project Area of $443 was equal to debt service in 2022.
$418 $ 418 $ 0 $ 418 $ 442 $ 443
Tax Allocation Bonds Total $ 418 $ 0 $ 418 $ 442 $ 443
Notes Payable
Series Purpose
Rate
Range Issue Date
Maturity
Date Note
Annual
Principal
Outstanding
Principal
Issuance
Disc/(Prem)
Accreted Int
Net Principal
Due
Payments to
Maturity
Fiscal Year
2022 Debt
Service
Payment
109 NOTE 7 - LONG-TERM LIABILITIES RDA: Roeding Business
Park
$2,118
Loaned
Loaned from the
California
Infrastructure and
Economic
Development Bank
to be used to
complete the
Roeding Business
Park
3.530% 3/18/2004 8/1/2033 Principal and interest due in annual installments. Secured by Tax Increment revenue received into the Roeding
Business Park Project area.
$75 to $114 $ 1,137 $ 0 $ 1,137 $ 1,394 $ 117
Notes Payable Total $ 1,137 $ 0 $ 1,137 $ 1,394 $ 117
Fiduciary Total $ 1,555 $ 0 $ 1,555 $ 1,836 $ 560
Grand Total $ 841,158 $ (13,048) $ 828,110 $ 1,055,804 $ 69,348 Series Purpose
Rate
Range Issue Date
Maturity
Date Note
Annual
Principal
Outstanding
Principal
Issuance
Disc/(Prem)
Accreted Int
Net Principal
Due
Payments to
Maturity
Fiscal Year
2022 Debt
Service
Payment
110 NOTE 7 - LONG-TERM LIABILITIES B. Debt Service Requirements (Excluding Capital Financing Activities) The annual debt service requirements excluding capital financings for the City's long-term debt outstanding as of June 30, 2022 are as follows (in thousands):
Governmental Activities Business-Type Activities Fiduciary Funds Year Ending
June 30 Principal Interest Principal
Interest
Accretion Interest Principal Interest
2023 $ 19,610 $ 10,830 $ 8,102 $ 526 $ 10,809 $ 418 $ 24 2024 19,045 9,716 6,177 539 10,399 — —
2025 17,940 8,610 10,614 551 10,091 — —
2026 18,270 7,546 11,149 561 9,500 — —
2027 19,370 6,450 11,700 570 8,872 — —
2028-2032 61,450 16,548 57,353 1,167 32,094 — —
2033-2037 25,810 6,460 40,550 — 16,126 — —
2038-2042 10,535 1,658 24,575 — 3,109 — —
2043-2047 4,060 414 — — — — —
2048-2052 — — — — — — —
2053-2057 — — — — — — —
Subtotal 196,090 68,232 170,220 3,914 101,000 418 24 Direct Direct Direct Direct Direct Direct
Borrowings Borrowings Borrowings Borrowings Borrowings Borrowings Principal Interest Principal Interest Principal Interest 2023 220 49 12,617 5,059 78 39
2024 92 41 12,776 4,899 81 36
2025 96 38 12,938 4,737 83 33
2026 99 35 13,103 4,573 86 30
2027 103 31 13,270 4,405 89 27
2028-2032 572 97 68,858 19,421 496 84
2033-2037 258 9 64,789 14,878 224 8
2038-2042 — — 64,513 10,013 — —
2043-2047 — — 136,826 4,746 — —
2048-2052 — — 25,651 383 — —
2053-2057 — — — — — —
Subtotal 1,440 300 425,341 73,114 1,137 257
Issuance
Premiums/
(Discounts) 8,712 — 1,259 — — — —
Unaccreted Interest — — — (837) — — —
Total $ 206,242 $ 68,532 $ 596,820 $ 3,078 $ 174,114 $ 1,555 $ 281 C. Debt Compliance
There are a number of limitations and restrictions contained in the various loan, note and bond indentures. The City believes it is in compliance with all significant limitations, restrictions and covenants.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 111 NOTE 7 - LONG-TERM LIABILITIES D. Debt Management Policy
The City maintains a Debt Management Policy (Policy) which sets forth certain debt management objectives, establishes overall parameters, and provides general direction in the planning, issuing, and administering of the City’s debt. The purpose of the Policy is to assist in the City’s ability to incur debt and other long-term obligations at favorable interest rates for capital improvements, facilities and equipment which are beneficial to the City and necessary for providing essential services.
The Policy integrates the best practices of other debt management plans utilized by similar California cities and is consistent with the provisions of the City Charter, and any enabling legislation.
As part of the Lease Revenue Bond refinancing that took place in 2017, the City’s Debt Management Policy was reviewed to ensure compliance with Senate Bill 1029 (SB 1029). That update was approved by Council on April 6, 2017.
E. Legal Debt Limit and Legal Debt Margin
Article XVI, Section 18 of the California Constitution, (the “debt limit”) prohibits cities (including chartered cities), counties, and school districts from entering into indebtedness or liability that in any year exceeds the income and revenue provided for such year unless the local agency first obtains two-thirds voter approval for the obligation. This general limitation has several important exceptions as described below. It is important to remember that this limitation applies not only to traditional bonds, but could apply to many forms of indebtedness or liability, such as installment payment obligations, long-term service or construction contracts, letter-of-credit reimbursement agreements, and other types of arrangements commonly seen in public finance transactions. In determining whether the arrangement under consideration might pose a problem under the debt limit it is useful to ask the following questions:
• Does the arrangement provide for payment in future fiscal years that comes out of revenue generated in those years?
• Does the arrangement call for payments by a city, county, or school district (as opposed to other types of governmental agencies)?
If the answer to these two questions is “yes", then the analysis should proceed to determine if one of the exceptions to the debt limit applies. There are three major exceptions to the debt limit that have been recognized by California courts: the Offner-Dean lease exception, the special fund doctrine, and the “obligations imposed by law” exception.
As of June 30, 2022, the City’s debt limit (20% of valuation subject to taxation) was $ 8.48 billion. This number was calculated by taking the Total Assessed Values (Gross) from the County of Fresno Tax Rate Book, page 14 multiplied by 20%. This is in comparison with debt limits of $ 8.17 billion in 2021.
The City’s legal debt margin is equal to the City’s debt limit because it has no debt subject to the limitation.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 112 NOTE 7 - LONG-TERM LIABILITIES F. Arbitrage
Under U.S. Treasury Department regulations, all governmental tax-exempt debt issued after August 31, 1986 is subject to arbitrage rebate requirements. The requirements stipulate, in general, the earnings from the investment of tax-exempt bond proceeds that exceed related interest expenditures on the bonds must be remitted to the federal government on every fifth anniversary of each bond issue. The City has evaluated each general obligation bond and lease revenue bond issue subject to the arbitrage rebate requirements and has deferred credits and other liabilities in the governmental funds. Each Enterprise Fund has performed a similar analysis of the debt the respective enterprise has issued which is subject to arbitrage rebate requirements. Any material arbitrage liability related to the debt of the Enterprise Funds has been recorded as a liability in the respective fund. In addition, the Successor Agency to the former Redevelopment Agency records any arbitrage liability in deferred credits and other liabilities. As of June 30, 2022, the City had an arbitrage liability of $68,919 related to the 1993A Sewer Revenue Bonds.
G. State Loan Program (Projects Currently In Progress)
On July 15, 2015 , the City entered into a 30-year agreement to borrow $ 195,489,000 from the California State Water Resources Control Board for construction of a new surface water treatment facility in southeast Fresno. The interest rate is fixed at 1.663% for the term of the loan. Principal and interest is due in semiannual installments for 30 years. As of June 30, 2022, the City has received $177,894,081 in proceeds. This amount is net of $3,000,000 in loan forgiveness by the State Water Resources Control Board. The loan forgiveness was part of the loan agreement with the State. Debt service payments will be funded from revenues of the Water Enterprise. Construction is now complete and annual debt service is $7,262,903.
On August 19, 2015, the City entered into a 30-year agreement to borrow $ 70,600,000 from the California State Water Resources Control Board’s Clean Water State Revolving Fund for construction of a recycled water distribution system in the southwest quadrant of the City. The interest rate is fixed at 1.0% for the term of the loan. Principal and interest is due in semiannual installments on the amount received by the City through the interest payment date. As of June 30, 2022 , the City has received $68,322,664 in proceeds. Debt service payments will be funded from revenues of the Sewer Enterprise. Once construction is completed, annual debt is estimated to be $2,028,979.
On April 5, 2016 , the City entered into a 30-year agreement to borrow $ 26,520,000 from the California State Water Resources Control Board for construction of a raw water pipeline to replace the Enterprise Canal as a primary conveyance system for the Northeast Surface Water Treatment Facility. The interest rate is fixed at 1.6% for the term of the loan. Principal and interest is due in semiannual installments for 30 years. As of June 30, 2022 , the City has received $21,379,590 in proceeds. Debt service payments will be funded from revenues of the Water Enterprise.
Construction is now completed, the annual debt is $1,116,533.
On April 5, 2016, the City entered into a 30-year agreement to borrow $65,875,669 from the California State Water Resources Control Board for construction of a pipeline from Kings River to the Southeast Water Treatment Facility. The interest rate is fixed at 1.6% for the term of the loan. Principal and CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 113 NOTE 7 - LONG-TERM LIABILITIES interest is due in semiannual installments for 30 years. As of June 30, 2022 , the City has received $57,615,335 in proceeds. Debt service payments will be funded from revenues of the Water Enterprise. The project is now complete and the annual debt is $2,773,546.
On August 23, 2016 , the City entered into a 30-year agreement to borrow $75,900,000 from the California State Water Resources Control Board for construction of regional transmission mains to transport water from facilities throughout the City. The interest rate is fixed at 1.6% for the term of the loan. Principal and interest is due in semiannual installments for 30 years. As of June 30, 2022 , the City has received $67,436,972 in proceeds. Debt service payments will be funded from revenues of the Water Enterprise. The project is now complete and the annual debt is $3,195,506.
On November 26, 2016 , the City entered into a 30-year agreement to borrow $14,000,000 from the California State Water Resources Control Board for construction of a new surface water treatment facility in the northeast portion of the City. The interest rate is fixed at 1.6% for the term of the loan.
Principal and interest due in semiannual installments will begin once the project is completed and continue for 30 years. Until completion, interest is due semiannually on the amount received by the City through the interest payment date. As of June 30, 2022 , the City has received $4,520,433 in proceeds. Debt service payments will be funded from revenues of the Water Enterprise. Even though the project was not fully completed, the City was required to make a payment of $79,570 plus interest of $20,303. Once construction is completed, the annual debt is estimated to be $606,000.
H. Capital Financing Activities
The City has entered into several Master Lease Agreements that allowed for a set amount of financing over the term of the Master Lease. Several financings took place under these Master Leases whose maturities exceeded the term of the agreement. These agreements qualify as capital financing activities for accounting purposes. Prior capital financing agreements with outstanding balances are with Community Leasing Partners and Key Government Finance, Inc.
On December 13, 2013, the City entered into a Master Lease Agreement with Dell Financial Services to finance the purchase of computers. Each schedule represents a separate capital financing purchase with annual upfront payment terms provided by the lender at the time the computers are purchased. To date, there have been forty-five schedules executed totaling $1,166,318 with interest rates ranging from 3.96% to 10.15% and terms between three and five years. As of June 30, 2022, four of these financed purchases remain outstanding.
On January 13, 2017, the City entered into a Master Equipment Lease-Purchase Agreement with Banc of America Public Capital Corp. (BAPCC). Each schedule represents a separate capital financing with annual upfront payment terms provided by the lender at the time the equipment is purchased.
There were nineteen schedules executed totaling $25,184,972 with interest rates ranging from 1.92% to 3.16% and terms between five and ten years. Early in fiscal year 2019, the City reached the maximum amount available to borrow under this master agreement which was $25 million.
On December 6, 2018, the City entered into a new Master Equipment Lease-Purchase Agreement with BAPCC. This agreement expired at an aggregate on December 31, 2021. There were twenty schedules executed totaling $17,832,047 with interest rates ranging between 0.91% and 2.83%.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 114 NOTE 7 - LONG-TERM LIABILITIES On October 14, 2019, the City entered into a new $134,076 lease purchase agreement with AT&T Capital Services, Inc. at a rate of 3.87%. The funds were used to update communication equipment on fire vehicles.
On February 21, 2020, the City entered into a new $5.6 million lease purchase agreement with Alliance Funding Solution, Inc., at a rate of 2.95%. The funds were used to install solar equipment and other energy efficient equipment at both City Hall and the City's Municipal Service Center.
On January 13, 2022, the City entered into a new Master Equipment Lease-Purchase Agreement with BAPCC. Each schedule represents a separate capital financing with annual upfront payment terms provided by the lender at the time of financing. The purpose of these finance purchases is to finance new and replacement equipment throughout the City. To date, there have been three schedules executed totaling $4.4 million with interest rates ranging from 1.66% to 2.76% and terms of five years. This new master agreement will expire at an aggregate of $35 million financed or December 31, 2024, whichever comes first.
On February 10, 2022, the city entered into a 15-year agreement to borrow $19.9 million from Alliance Building Solutions, Inc for a design-build contract to build turn-key PARCS and Public Safety facilities which will include upgrades to lighting to convert to LED efficient lighting, HVAC upgrades and replacements, system controls and monitoring, lighting controls, and transformer upgrades for implementation of a robust list of energy related and sustainability services. The interest rate is fixed at 2.62% for the term of the lease. Principal and interest due in semiannual installments that begin on August 16, 2022. Expected energy bill savings are expected to exceed $23 million over the life of the agreement by creating 3.5 million kilowatt hours per year, which is equivalent to taking 539 gas- powered vehicles off the road every year or powering nearly 300 homes annually. This aligns with the City's GHG Reduction Plan (Climate Action Plan) Municipal Strategies section 5.1.7 which targets GHG emissions generated at City facilities and operations.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 115 NOTE 7 - LONG-TERM LIABILITIES The following table lists the City’s capital financing activities by lender as of June 30, 2022 (in thousands):
Community First National Bank 7/13/2015 10 2015 Smeal Engines on Spartan Metrostar Chassis (4) 2.92% $ 105 Community First National Bank 9/22/2015 10 2015 Smeal Engines on Metrostar (3) & Aerial on Gladiator (1) 2.69% 340 Community First National Bank 2/22/2016 10 2015 Smeal Engine & 2016 Water Tender on Kenworth 2.09% 157 Dell Financial Services 9/1/2018 5 Dell OptiPlex 5050SFF(36) & Latitude 3580 (6) 5.63% 10 Dell Financial Services 3/1/2020 4 Dell Latitude Laptops (3) 3.96% 1 Dell Financial Services 5/1/2020 4 Computers Various Models (55) 4.28% 14 Dell Financial Services 5/1/2020 3 Computers Various Models (85) 5.32% 37 Key Government Finance, Inc. 4/10/2019 5 City-Wide Date System 3.88% 1,950 Banc of America Public Capital Corp 4/10/2017 5 Fire Chevy Silverado Pickup 2.07% 10 Banc of America Public Capital Corp 5/2/2017 10 Fire Engines & Pumpers 2.52% 464 Banc of America Public Capital Corp 5/11/2017 5 Police Vehicles (84) 1.96% 692 Banc of America Public Capital Corp 11/20/2017 5 Police Vehicles (55) 2.14% 587 Banc of America Public Capital Corp 8/1/2017 5 Police Motorcycles (14) & Fire Vehicles (9) 1.92% 164 Banc of America Public Capital Corp 11/29/2017 5 DARM Ford F-150 Pickup Trucks (24) 2.14% 115 Banc of America Public Capital Corp 11/23/2017 7 Microwave Date & Radio Console Network 2.46% 783 Banc of America Public Capital Corp 2/2/2018 5 Police MAGEC Vehicles (4) 2.44% 28 Banc of America Public Capital Corp 4/24/2018 5 DARM Ford-150 Pickup Trucks (14) & Parks (4) 2.62% 95 Banc of America Public Capital Corp 6/26/2018 10 Fire Ladder Truck & Pumpers (3) 3.16% 371 Banc of America Public Capital Corp 7/2/2018 5 Police CIT Vehicles (5) 2.76% 134 Banc of America Public Capital Corp 7/17/2018 5 Parks Ford Transit Wagon (1) 2.74% 4 Banc of America Public Capital Corp 7/17/2018 5 Police MAGEC Vehicle (1) 2.74% 7 Banc of America Public Capital Corp 9/14/2018 5 Fire Light Duty Vehicles (5) 2.73% 34 Banc of America Public Capital Corp 9/28/2018 5 Parks John Deere Tractor (1) 2.75% 9 Banc of America Public Capital Corp 10/5/2018 5 Police Vehicles (50) 2.84% 540 Banc of America Public Capital Corp 10/11/2018 5 Police Motorcycles (10) 2.86% 67 Banc of America Public Capital Corp 11/2/2018 5 DARM Ford-150 Pickup Trucks (27) 2.91% 147 Banc of America Public Capital Corp 11/9/2018 5 Police Undercover Vehicles (33) 2.90% 193 Banc of America Public Capital Corp 3/20/2019 5 Police SRO Vehicles (16) & Undercover (2) 2.73% 204 Banc of America Public Capital Corp 4/2/2019 5 Police F-150 Super Crew Pickup Trucks (15) 2.72% 118 Banc of America Public Capital Corp 5/29/2019 10 Fire Pumper Trucks (3) 2.83% 239 Banc of America Public Capital Corp 6/6/2019 5 Police Undercover Vehicles (10) 2.43% 109 Banc of America Public Capital Corp 8/30/2019 5 2019 Police Motorcycles (10) 1.90 % 75 Banc of America Public Capital Corp 11/12/2019 5 2020 Fire Ford Escapes (4), Ford F-250's (2) 1.95 % 60 Banc of America Public Capital Corp 2/11/2020 5 2020 Police U.C. Vehicles (28) 1.97 % 197 Banc of America Public Capital Corp 4/10/2020 5 2020 Police Vehicles (30) 1.11 % 359 Banc of America Public Capital Corp 4/21/2020 5 2020 Police U.C. Vehicles (3) 1.09 % 26 Banc of America Public Capital Corp 5/4/2020 5 2020 Fire Ford F-350 (1) & Ford Interceptor (1) 1.03 % 31 Banc of America Public Capital Corp 5/15/2020 10 2020 Fire Engines (4) 1.34 % 311 AT&T Capital Services, Inc. 10/14/2019 5 Cradlepoint System 3.87 % 33 Alliance Funding Solutions, Inc. 2/21/2020 15 Energy Efficient Equipment and Solar PPA (City Hall & MSC) 2.95 % 417 Banc of America Public Capital Corp 8/17/2020 10 Type III Fire Engines (2) 1.26% 82 Banc of America Public Capital Corp 11/19/2020 5 PARCS Ford Transit Van (1) 0.92% 8 Banc of America Public Capital Corp 11/19/2020 5 Freightliner Street Sweepers (2) 0.92% 163 Banc of America Public Capital Corp 1/19/2021 5 Fire Ford F-250 (1) 0.91% 10 Banc of America Public Capital Corp 2/19/2021 5 Fire Squad Vehicle (1) 0.92% 29 Banc of America Public Capital Corp 3/25/2021 5 IPS Parking Meters 1.03% 413 Banc of America Public Capital Corp 6/9/2021 10 Fire Engines (2) & Truck (1) 1.73% 319 Banc of America Public Capital Corp 6/18/2021 5 Fire Light Duty Vehicle (3) 1.06% 60 Banc of America Public Capital Corp 11/3/2021 5 2021 Undercover Vehicles (5) 1.32% 21 Lender
Date of
Loan
Term
(Years) Purchased
Interest
Rate
Annual
(P&I Payment)
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 116 NOTE 7 - LONG-TERM LIABILITIES Banc of America Public Capital Corp 2/8/2022 5 2021 Fire Ford F-350 Chassis (8) 1.66% 730 Banc of America Public Capital Corp 5/11/2022 5 2022 Fire Ford Vehicles (13) 2.76% 757 Banc of America Public Capital Corp 6/16/2022 5 2022 Dodge Durangos (33) 2.70% 2,891 Total $ 14,720
Lender
Date of
Loan
Term
(Years) Purchased
Interest
Rate
Annual
(P&I Payment)
Capital Financing Activities debt service requirements are presented below (in thousands). Interest rates range from 0.91% to 5.63%.
Year Ended Governmental Activities
June 30 Principal Interest
2023 $ 9,654 $ 1,218
2024 9,326 993
2025 6,246 785
2026 4,959 653
2027 4,057 544
2028-2032 10,231 1,712
2033-2037 8,095 573
Total $ 52,568 $ 6,478
I. General Fund Short-Term Borrowing Obligations
The City did not issue any short-term debt during fiscal year 2022 and did not have any short-term debt outstanding during the fiscal year.
J. Unused Lines of Credit
The following table lists the City's unused lines of credit as of June 30, 2022 (in thousands):
Line of Credit Contract Amount Used Unused
CA State Water Resources Control Board
Drinking Water State Revolving Fund (1010007-32C) $ 14,000 $ 4,520 $ 9,480 Banc of America Public Capital Corporation
Police Vehicles 9,233 5,626 3,607
Fire Vehicles 583 517 66
Microwave Data & Radio Console Network 5,018 4,685 333 Key Government Finance, Inc
Citywide Data System 9,500 9,189 311
Alliance Funding Solutions, Inc.
Energy Efficient Equipment & Solar 21,803 9,361 12,442 Total $ 60,137 $ 33,898 $ 26,239
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 117 NOTE 7 - LONG-TERM LIABILITIES K. Debt Collateral
The following table lists the City's assets that are pledged as collateral for various City debts:
Debt Asset Pledged Expiration Date
JPFA Lease Revenue Bonds
1998 B Exhibit Hall Expansion Project Fresno Convention Center, 848 M. Street September 1, 2028 2001 A&B Stadium Project Fire Station #19, 2187 W. Belmont Ave June 1, 2031 Saroyan Theater, 730 M. Street June 1, 2031
2004 A,B,C Various Capital Projects Convention Center Parking Garage, Inyo & O Streets October 1, 2034 Fire Station #15, 5630 E. Park Circle October 1, 2024
Fire Station #17, 10512 N. Maple Ave October 1, 2024
2008 F Convention Center Fresno City Hall, 2600 Fresno Street April 1, 2046 2017 A Various Refunding Bond Fire Station #16, 2510 N. Polk Ave April 1, 2039 Fresno Memorial Auditorium, 2425 Fresno Street April 1, 2039 Fresno Municipal Center, 1325 El Dorado Street April 1, 2039 Parking Garage #4, 1919 Tulare Street April 1, 2039
Parking Garage #8, 1077 Van Ness Ave April 1, 2024
Police Regional Training Center, 6375 W. Central Ave April 1, 2039 Selland Arena, 700 M Street April 1, 2024
Chukchansi Park, 1800 Tulare Street April 1, 2031
Valdez Hall, 702 M Street April 1, 2039
Southern Portion of Woodward Park, 7775 N. Friant Road April 1, 2024 2020 A Animal Services Center Fresno City Hall, 2600 Fresno St. April 1, 2046 California Infrastructure & Development Bank
Roeding Business Park Loan City Hall Annex, 2326 Fresno Street August 1, 2033 U.S. Department of Housing and Urban
Development
Neighborhood Streets & Parks Loan Al Radka Park, 5897 E. Belmont Ave August 1, 2022 Jaswant Singh Khalra Park, 3861 W. Clinton Ave August 1, 2022 Todd Beamer Park, 1890 E. Plymouth Way August 1, 2022
Romain Playground, 745 N. First Ave August 1, 2022
L. Significant Events of Default, Termination and Subjective Acceleration Clauses The City’s debt agreements contain the following terms regarding significant Events of Default, Termination and Subjective Acceleration Clauses:
Bonds
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 118 NOTE 7 - LONG-TERM LIABILITIES For all City bonds, an Event of Default is generally classified as one or more of the following (1) nonpayment or late payment of principal and/or interest due on the bonds, (2) failure to be in compliance with debt covenants and agreements, and (3) the City filing for bankruptcy. If an Event of Default occurs, the majority owners of the bonds (not less than 51%) may declare the principal amount of all bonds outstanding and the interest accrued on them to be due and payable immediately. This applies to all City bonds except for the Series 2003 Tax Allocation Bonds. Only 25% of bond owners are required to declare the bonds due and payable immediately.
The City’s bond agreements do not contain Subjective Acceleration Clauses.
Notes & Loans
For City loans associated with the construction of Water Supply Disinfection Buildings, improvements to the Enterprise and Jefferson Canals, and the City’s Water Meter Project, an Event of Default is generally classified as one or more of the following: (1) nonpayment of any installment when due, (2) failure to make any remittances required by the agreement, (3) substantial breach to the agreement, (4) making any false warranty, representation, or statement with respect to the agreement, and (5) loss, theft or damages to any collateral given as security under the agreement. In an Event of Default, the State of California may do any or all of the following: (1) declare the City’s obligations due and payable immediately, (2) terminate any obligation to make further cash disbursements to the City, and (3) exercise all rights and remedies available to a secured creditor after default.
For City loans associated with the Southeast Surface Water Treatment Facility, the Regional Transmission Mains, the Enterprise Canal Raw Water Pipeline, the Kings River Pipeline, the Southwest Quadrant Recycled Water Distribution System, and the Tertiary Treatment Facility, the agreements can be terminated by the State Water Resources Control Board (SWRCB) if the City violates any material provision of the agreement. Some examples of violations would be if the City fails to notify the SWRCB of (1) principal and interest payment delinquencies, (2) unscheduled draws on debt service reserves, (3) bankruptcy or insolvency of the City. If a termination event occurs, the City can be demanded by the SWRCB to immediately repay an amount equal to the funds disbursed to them plus accrued interest and penalties.
For City loans associated with HUD Section 108, an Event of Default under these agreements is generally classified as one or more of the following: (1) failure to pay an installment of principal or interest due, (2) failure to properly comply with any covenant or condition of the agreement, and (3) failure to comply substantially with Title I of The Housing and Community Development Act of 1974.
In an Event of Default, the Department of Housing and Urban Development Secretary (Secretary) may do any or all of the following: (1) use funds or security pledged under the agreement to (a) continue to make payments due on the note, (b) make an acceleration payment of the principal amount subject to Optional Redemption, (c) pay any interest due for late payment, or (d) pay any other expense incurred by the Secretary as a result of the City’s default; (2) withhold the grants not yet disbursed; (3) direct the City’s financial institution to refuse to honor any draws on the Guaranteed Loan Funds Account or the Loan Repayment Account by the City; (4) accelerate the note amount subject to Optional Redemption, and (5) exercise any other remedies available by law including recovery of Guaranteed Loan Funds or reimburse any expense incurred as a result of City’s default.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 119 NOTE 7 - LONG-TERM LIABILITIES For the City loan associated with Roeding Business Park, an Event of Default under this agreement is classified as one or more of the following: (1) failure to pay principal and interest on the loan, (2) the occurrence of an event of default with any parity debt or subordinate debt which causes all principal of parity or subordinate debt to become due and payable immediately, (3) failure to comply with any of the covenants or conditions of the agreement, (4) filing for bankruptcy, (5) any false representation by the City, and (6) failure to pay amounts due under any other City debt if unpaid amount shall exceed $50,000. In an Event of Default, the California Infrastructure Bank may (1) declare the principal of the loan and the accrued interest on all unpaid balances to be due and payable immediately and (2) exercise any other remedies available by law.
The City’s note and loan agreements do not contain Subjective Acceleration Clauses.
Capital Financing Activities
For all City's financed purchases associated with Banc of America Public Capital Corp (BAPCC), an Event of Default is classified as one or more of the following: (1) failure to pay in full the rental payment due, (2) failure to comply with any covenant or agreement of the lease, (3) filing for bankruptcy, (4) any warranty, representation or statement made by the City to be found materially incorrect, (5) any default occurring under any other debt agreement the City has, and (6) the City selling, leasing, or encumbering any of the equipment under the lease. In an Event of Default, BAPCC may do any or all of the following: (1) immediately terminate the lease and repossess the equipment and (2) exercise any other remedies available by law.
For the City's financed purchases associated with Key Government Finance, Inc., an Event of Default is classified as one or more of the following: (1) failure to pay any rental payment, (2) failure to observe and perform any covenant or condition under the agreement, (3) any warranty, representation or statement made by the City to be found materially incorrect, and (4) filing for bankruptcy by the City. In an Event of Default, Key Government Finance, Inc. may do any or all of the following: (1) declare all rental payments and other amounts payable to the end of the then current budget year to be due, (2) retake possession of the property under the lease, (3) instruct the escrow agent to release all proceeds and any earnings thereon to Key Government Finance, Inc. and (4) take any action that is permitted by law to protect its rights under the agreement.
For the City's financed purchases associated with Alliance Funding Solutions, Inc., an Event of Default is classified as one or more of the following: (1) failure to make rental payments when due, (2) failure to maintain insurance on leased property, (3) failure to perform or observe any obligations, covenants or conditions under the lease, (4) filing for bankruptcy by the City, and (5) any warranty, representation or statement made by the City to be found materially incorrect. In an Event of Default, lessor may do any or all of the following: (1) require the City to pay all amounts currently due and all payments remaining due during the fiscal year in which default occurs, (2) exercise any other remedies available under the law, (3) take possession of the equipment and sell or lease it to pay for past due lease payments owed by the City, (4) terminate the lease, and (5) terminate the escrow fund and apply any remaining amount to the balance owed by the City.
The City’s capital lease agreements do not contain Subjective Acceleration Clauses.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 120 NOTE 7 - LONG-TERM LIABILITIES Note 8. Interfund Activity
A. Due to/from Other Funds
Due to/from Other Funds represents short-term borrowings resulting from a fund’s temporary need for additional cash. Primarily, these amounts have been recorded when timing differences between when the services are provided and when they are paid for/reimbursed causes the funds to temporarily overdraw their share of pooled cash. These balances are generally expected to be repaid within the next few months and not longer than a 12-month fiscal operating cycle.
The composition of interfund balances as of June 30, 2022, is as follows (in thousands):
General Fund Grants Special Revenue Fund $ 3,734
Nonmajor Governmental Funds 2,310
Nonmajor Enterprise Funds 512
Internal Service Funds 8,035
14,591
Grants Special Revenue Fund Internal Service Funds 1,749 Nonmajor Governmental Funds Grants Special Revenue Fund 161 Internal Service Funds 2,518
Fiduciary Funds 103
2,782
Water System Grants Special Revenue Fund 78
Internal Service Funds 9,738
9,816
Sewer System Grants Special Revenue Fund 88
Solid Waste Management 1
Internal Service Funds 6,624
6,713
Solid Waste Grants Special Revenue Fund 41
Internal Service Funds 2,983
3,024
Transit Grants Special Revenue Fund 107
Internal Service Funds 54
161
Receivable Fund Payable Fund Amount
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
121 NOTE 8 - INTERFUND ACTIVITY Airports Grants Special Revenue Fund 43
Internal Service Funds 400
443
Nonmajor Enterprise Funds Grants Special Revenue Fund 8 Internal Service Funds 901
909
Internal Service Funds General Fund 1,100
Grants Special Revenue Fund 133
Nonmajor Government Funds 345
Water System 115
Sewer System 136
Solid Waste Management 563
Transit 139
Airports 35
Nonmajor Enterprise Funds 133
Internal Service Funds 145
2,844
Total Due to/from Other Funds $ 43,032
Receivable Fund Payable Fund Amount
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
122 NOTE 8 - INTERFUND ACTIVITY B. Advances
Advances represent long-term borrowing between funds.
Fire Headquarters
In fiscal year 2018, the General Fund borrowed $3.1 million from the Wastewater Operation Fund and the Sewer Stabilization Fund in order to provide sufficient funding for the purchase of the Fire Department's Headquarters Building. The governing resolution formalizing this advance was adopted by Council on May 10, 2018. The term of the advance is five years and the rate of interest is equal to the rate of interest paid on the City's pooled deposits and investments. As of the effective date of the agreement (June 25, 2018) the interest rate was 1.35%. As of June 30, 2022, $2.5 million has been repaid and $0.6 million remains outstanding.
Fire Station No. 18
On November 14, 2019, a loan was executed between the City's UGM Area Wide Oversized Sewer fund, the City's UGM Wellhead Treatment Area 101S Fund, and the City of Fresno's Fire Station 18 Construction Fund, whereby funds were loaned to the Fire Station 18 Construction Fund to cover building costs of Fire Station 18. An amount not to exceed $2.4 million was borrowed from the UGM Area Wide Oversized Sewer Fund and $1.46 million was borrowed from the UGM Wellhead Treatment Area 101S Fund. The term of the loan will be not more than five (5) years and shall be repaid in full by July 31, 2024. Interest will accrue at a rate equal to the City's Pooled Investment Rate, which was
2.325% as of the effective date of the Loan Agreement. Each year, Fire Station 18 Construction Fund shall pay at least 1/5 th of the principal balance of the loan plus interest accrued to the payment date.
To the UGM Area Wide Oversized Sewer Fund, the annual principal payment is $480,000, while the annual payment to the UGM Wellhead Treatment Area 101S Fund is $291,450. As of June 30, 2022, $3.9 million of proceeds from this loan had been transferred to the Fire Station 18 Construction Fund and $1.4 million had been repaid.
Animal Shelter
On June 1, 2020, a loan was budgeted between the City's Water Enterprise Fund and the City of Fresno Animal Shelter Construction Fund, whereby funds were loaned to the Animal Shelter Construction Fund to cover building costs of a new Animal Shelter. An amount not to exceed $18.5 million was budgeted to be borrowed from the Water Enterprise Fund. The term of the loan will be not more than five (5) years. Interest will accrue at a rate equal to the City's Pooled Investment Rate, which was 2.042% as of March 2020. Each year, the Animal Shelter Construction Fund shall pay at least 1/5th of the principal balance of the loan plus interest accrued to the payment date. During fiscal year 2021, bond proceeds from the 2020-A Animal Services Facility Lease Revenue Bonds became available to fund construction. As of June 30, 2021, no proceeds from the Water Fund had been or are expected to be transferred to the Animal Shelter Construction Fund.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
123 NOTE 8 - INTERFUND ACTIVITY DPU Facility
On April 1, 2021, a loan was executed between the City's Water Division and the Solid Waste Division, whereby $3.7 million was loaned to the Solid Waste Division for the joint purchase of a facility to bring all Utilities services that can be merged into one facility. The term of the loan will be 5 years from the effective date of the loan, or April 1, 2026, and will accrue interest at a rate equal to the City's pooled rate, which was 1.78% as of the effective date of the loan agreement. The Solid Waste Division shall make principal payments in the amount of 1/10th of the loan amount and interest payments twice per year on October 1 and April 1 of each fiscal year. As of June 30, 2022, all $ 3.7 million of proceeds from this loan had been transferred to the Solid Waste Fund and $0.7 million had been repaid.
Valley Inn
On June 29, 2021, a loan was executed between the City's Sewer Operations Fund and the General Fund, whereby $10 million was loaned to the General Fund for the purchase of a local motel for the purpose of housing the City's homeless population, as well as providing rehabilitation and property management services. The term of the loan was originally set to expire on June 30, 2022 but was amended in FY '22 and now will expire on December 31, 2022. The loan will accrue interest at a rate equal to the City's pooled rate, which was 1.78% as of the effective date of the loan agreement. As of June 30, 2022, all $10 million of proceeds from this loan had been transferred to the General Fund and $0 had been repaid.
Redevelopment Agency
Advances over the years between the City and the former Redevelopment Agency (RDA) were made to provide funds for the purpose of eliminating blight and developing, constructing, rehabilitating, and revitalizing Fresno’s inner city neighborhoods, downtown, and industrial areas. The advances had all been secured by and payable from the incremental property tax revenues of the redeveloped properties. Interest rates varied between 5% and 9%, with payments on the advances and related interest based upon budgetary priority as approved by the former RDA.
In June 2011, all California RDAs were required to dissolve effective February 1, 2012. The law dissolving the RDAs called for the creation of a Successor Agency (SA) to wind down RDA business.
The initial dissolution law provided that the SA would pay “enforceable obligations” of the former RDA. However, the law initially excluded debt a former agency owed to the city that created it from the definition of enforceable obligations, unless the debt was created in the first two years following the agency’s creation or was debt that represented third party obligations. Subsequent legislation allowed limited, conditional repayment of loans by the SA to the community that created it.
When the RDA dissolution process began, City staff considered it to be premature to consider the debt owed by the former RDA to the City as being current. Thus, an allowance for doubtful accounts was created by the City, which at June 30, 2011, totaled $80.1 million. This amount, which was equal to the calculated amount of the debt, was reflective primarily of principal and interest accrued over the years on the advances. As payments on the debt have been received and legal decisions have CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
124 NOTE 8 - INTERFUND ACTIVITY been rendered, which further defined an "enforceable obligation", staff revisited that initial allowance for doubtful accounts amount and refined it. At the end of fiscal year 2022, the allowance for doubtful accounts stood at $6.5 million.
As the funds are received, 20% of any loan repayment received by the City must be deducted from the loan repayment amount and be transferred to the Low and Moderate Income Housing Fund. In fiscal year 2022, this amount totaled $ 0.4 million. The repayment is reflected on the ACFR on the Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds, under the Special Revenue Low and Moderate Income Housing Fund.
On June 23, 2016, the City Council approved a resolution requiring any amount of the annual repayments of RDA debt that are received and not related to Enterprise Funds related loans would go toward the rebuilding of the City’s Emergency Reserve Fund. Through June 30, 2022, the City had received $ 32.4 million in loan repayments from the SA. With the adoption of the fiscal year 2019 budget and the corresponding achievement of a 10% reserve, these repayments became a General Fund revenue source.
City of Fresno Advances to Former Redevelopment Agency (In Thousands) Principal Cumulative Interest Cumulative Total
Receivable Fund
Beginning
Balance
Advances/
Adjustments
Payments/
Write-offs
Ending
Balance
Beginning
Balance
Accruals/
Adjustments
Payments/
Write-offs
Ending
Balance
Total
Receivable
Allowance
for
Doubtful
Receivable
(Net of
Allowance)
General Fund:
General Fund $ 838 $ — $ — $ 838 $ 621 $ 25 $ — $ 646 $ 1,484 $ (1,484) $ — Parking Trust 150 — — 150 111 5 — 116 266 (266) — 988 — — 988 732 30 — 762 1,750 (1,750) —
Grants Special
Revenue Fund 4,769 — — 4,769 6,273 143 (2,165) 4,251 9,020 (2,172) 6,848 Nonmajor
Governmental Funds:
Gas Tax 1,150 — — 1,150 858 34 — 892 2,042 (2,043) (1) 1,150 — — 1,150 858 34 — 892 2,042 (2,043) (1) Fresno Convention
Center 304 — — 304 219 9 — 228 532 (532) —
304 — — 304 219 9 — 228 532 (532) —
Total $ 7,211 $ — $ — $ 7,211 $ 8,082 $ 216 $ (2,165) $ 6,133 $ 13,344 $ (6,497) $ 6,847 Subsequent to fiscal year-end, the City received a reimbursement on loans made to the former RDA.
The amount received was $ 2.3 million, of which $ 1.9 million was paid to the City and $ 0.5 million was paid to the Housing Successor.
Redevelopment Agency - Housing Assets
The City became the “Housing Successor” of the former RDA’s Housing Assets. These assets were transferred to the City, who has sole legal authority to administer housing assets pursuant to the Redevelopment Dissolution Laws. This allows the City to complete projects under contract, liquidate surplus real estate and distribute proceeds to taxing entities, pursue repayment of RDA obligations to the City, and administer housing assets.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
125 NOTE 8 - INTERFUND ACTIVITY Other Advances
The Sewer System sold land to the General Fund for the purpose of constructing a regional public safety training facility. Interest for the advance is equal to two percent (2%) above the City’s monthly Pooled Investment Rate. The first interest only payment was due July 31, 2008. Principal, at not less than 1/29 th of the original principal, and interest payments are due annually thereafter. The remaining advances are interest free and payable on demand. The amounts are not expected to be repaid within the next twelve-month fiscal operating cycle.
The composition of interfund balances (advances from/to other funds) as of June 30, 2022 , is as follows (in thousands):
Receivable Fund Payable Fund Amount
Grants Special Revenue Fund Fiduciary Funds $ 6,848
Nonmajor Governmental Funds Nonmajor Governmental Funds 62 Water System Nonmajor Governmental Funds 1,050
Solid Waste 2,969
4,019
Sewer System General Fund 10,862
NonMajor Governmental Funds 1,440
12,302
Total Advances $ 23,231
C. Transfers
Transfers represent subsidies by one fund to another in accordance with the budget and provide for various City programs and provide resources for the payment of debt service.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
126 NOTE 8 - INTERFUND ACTIVITY The following is a summary of interfund transfers for the fiscal year ended June 30, 2022 (in thousands):
Receiving Fund Paying Fund Amount
General Fund Grants Special Revenue Fund $ 4,291
Nonmajor Governmental Funds 2,643
Solid Waste Management 708
Transit 597
Internal Service Funds 348
8,587
Grants Special Revenue Fund General Fund 334
Nonmajor Governmental Funds 1,748
Internal Service Funds 18
2,100
Nonmajor Governmental Funds General Fund 26,120
Grants Special Revenue Fund 695
Nonmajor Governmental Funds 24,040
Water System 378
Sewer System 346
Solid Waste Management 325
Transit 856
Airports 268
Nonmajor Enterprise Funds 97
Internal Service Funds 888
54,013
Water System General Fund 1
Sewer System General Fund 1
Solid Waste Management General Fund 666
Nonmajor Enterprise Funds 928
1,594
Airports General Fund —
Fresno Convention Center General Fund 6,122
Stadium General Fund 3,694
Nonmajor Enterprise Funds General Fund 1,300
Internal Service Funds General Fund 1,783
Grants Special Revenue Fund 1,252
Water System 1,095
4,130
Total Transfers $ 81,542
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
127 NOTE 8 - INTERFUND ACTIVITY The General Fund transferred $ 26.1 million to Nonmajor Governmental Funds to provide support for debt service payments and capital projects; $ 6.1 million to the Convention Center for debt service as well as general operating support; $ 1.8 million to Internal Service Funds for provided services; $ 0.7 million to Solid Waste for transverse charges and $ 3.7 million to the Stadium Fund for debt service payments.
The Grants Special Revenue Fund transferred $68.3 million to the General Fund, $0.1 million to Nonmajor Governmental Funds, and $7.4 million to Proprietary Funds for Coronavirus Aid Relief, and Economic Security (CARES) Act eligible expenses.
Nonmajor Governmental Funds transferred $ 28.4 million for debt service and miscellaneous purposes. Internal Service Funds transferred $ 0.9 million to Nonmajor Governmental Funds for debt service payments. Enterprise Funds transferred $2.3 million to Nonmajor Governmental Funds for debt service payments.
D. Recap of Interfund Activity
The following schedule recaps Interfund Activity at June 30, 2022 (in thousands):
Due from
Other
Funds
Due to
Other
Funds
Advances
Receivable
from Other
Funds
Advances
Payable to
Other
Funds
Transfers
In
Transfers
Out
Governmental Funds:
General Fund $ 14,591 $ 1,100 $ — $ 10,862 $ 8,587 $ 40,021 Grants Special Revenue Fund 1,749 4,393 6,848 — 2,100 6,238 Nonmajor Governmental Funds 2,782 2,655 62 2,552 54,013 28,431 Total Governmental Funds 19,122 8,148 6,910 13,414 64,700 74,690 Proprietary Funds:
Water System 9,816 115 4,019 — 1 1,473
Sewer System 6,713 136 12,302 — 1 346
Solid Waste Management 3,024 564 — 2,969 1,594 1,033 Transit 161 139 — — — 1,453
Airports 443 35 — — — 268
Fresno Convention Center — — — — 6,122 —
Stadium — — — — 3,694 —
Nonmajor Enterprise Funds 909 645 — — 1,300 1,025 Internal Service Funds 2,844 33,147 — — 4,130 1,254 Total Proprietary Funds 23,910 34,781 16,321 2,969 16,842 6,852 Fiduciary Funds:
Major Governmental Funds — — — 6,848 — —
Total Fiduciary Funds — 103 — 6,848 — —
Total $ 43,032 $ 43,032 $ 23,231 $ 23,231 $ 81,542 $ 81,542 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
128 NOTE 8 - INTERFUND ACTIVITY Note 9. Defeasances
Current Year Defeasances
The City had no defeasance or refunding of debt for the fiscal year ending June 30, 2022.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
129 NOTE 9 - DEFEASANCES Note 10. Risk Management Fund
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; business interruption; errors and omissions; automobile liability and accident claims; natural disasters; employee health benefit claim payments; and injuries to employees (workers’ compensation). With certain exceptions, it is the policy of the City to use a combination of self- insurance and purchased commercial insurance against property, liability, or workers’ compensation risks. The City believes it is more economical to manage its risks internally and set aside funds as needed for estimated current claim settlements and unfavorable judgments through annual appropriations and supplemental appropriations. The City maintains limited coverage for certain risks that cannot be eliminated. The Risk Management Division investigates and manages all liability claims and property losses, evaluates risk exposure and insurance needs, protects against contractual loss by reviewing/preparing insurance and indemnification portions of contractual documents, emphasizes ongoing operational loss control, and purchases all insurance coverage for the City.
The City maintains General Liability insurance, with limits of liability of $ 25 million per occurrence and $35 million aggregate in Excess Liability coverage. There is a $ 5 million self-insured retention (SIR).
Coverage is provided by the Safety National Insurance Company ($ 2 million /$4 million ) or Safety Specialty ($2 million), depending on the line of coverage, and thereafter Safety Specialty Insurance Company ($ 3 million /$6 million ), Allied Insurance Company ($ 10 million /$10 million ), Hallmark Insurance ($5 million / $ 5 million) and Gemini Insurance ($ 5 million/$5 million). The City has procured Automobile Physical Damage coverage through Hanover Insurance Company with a $ 10 million limit.
For this policy, the deductible is $ 50,000 for vehicles valued at less than $ 150,000, while the deductible is $ 100,000 for vehicles valued at $ 150,000 or more. The City carries Government Crime coverages with a $ 5 million limit secured through Zurich Insurance Company with a $ 50,000 deductible. The City has Cyber liability coverage under AXA XL with a $ 500,000 SIR and a $ 5 million limit and excess Cyber liability coverage under Illinois Union Insurance Company ($ 5 million /$5 million). The City also maintains Airport Owners and Operators General Liability insurance and Aviation (Aircraft Liability), with limits of liability of $ 100 million . There is no deductible or SIR.
Coverage is provided by Old Republic Insurance Company through Phoenix Aviation Managers (Texas), Inc.
Furthermore, the City maintains Property insurance and Boiler and Machinery insurance with Travelers Insurance, with total insured values of $ 2,189,263,752 and limits of liability of $ 500,000,000.
There is a $ 100,000 deductible for most losses. Flood losses have a $ 250,000 deductible. Property insurance does not cover losses due to seismic events. Finally, the City maintains Aviation (Aircraft Hull) insurance for two helicopters, with limits of liability of $ 50 million . There is a 1.0% of insured value each claim, subject to a maximum of $ 15,000, rotors in-motion deductible and $ 0 rotors not in- motion deductible of each helicopter. Coverage is provided by Old Republic Insurance Company through Phoenix Aviation Managers (Texas), Inc.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
130 NOTE 10 - RISK MANAGEMENT FUND The City’s Workers’ Compensation Program consists of $ 2 million SIR, with purchased excess insurance layers up to the statutory limits. Settled claims have not exceeded the SIR in any of the last five fiscal years. The claims liabilities and workers’ compensation liabilities reported on the Statement of Net Position have been actuarially determined and include an estimate of incurred but not reported losses.
The estimated liabilities of the Risk Management ISF as of June 30, 2022 are determined by the City based on recommendations from an independent actuarial evaluation. The liabilities are based on estimates of the ultimate cost of claims (including future claim adjustments expenses) that have been reported but not settled, and claims that have been incurred but not reported (IBNR). The claims liability of $ 200.5 million reported in the Risk Management Internal Service Fund at June 30, 2022 is based on the requirement that claims be reported if information prior to the issuance of the financial statements indicates it is probable that a liability has been incurred at the date of the financial statements and the amount of loss can be reasonably estimated.
The recorded liabilities for each program at June 30, 2022 are as follows (in thousands):
Workers' Compensation * $ 145,151
Liability and Property Damage * 55,376
Total $ 200,527
* The liabilities for workers' compensation and general liability are presented at present value, using a discount rate of 3%.
Changes in the funds claims liability amount for the last two fiscal years are as follows (in thousands):
Fiscal Year
Ended June 30
Beginning of
Fiscal Year
Liability
Current Year Claims
and Changes in
Estimates
Claims
Payments
End of Fiscal
Year Liability
2021 $ 150,308 $ 59,722 $ 24,297 $ 185,733
2022 $ 185,733 45,009 30,215 200,527
See Note 10 Section G for changes in funds claims liability related to Employees Healthcare Plan.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
131 NOTE 10 - RISK MANAGEMENT FUND Note 11. Employee Benefit Programs
A. Retirement Plans
The City sponsors two single-employer, contributory, defined benefit pension plans. The City of Fresno Employees Retirement System and the City of Fresno Fire and Police Retirement System (Systems) were established under Charter Section 910 and are governed by Article 5 Chapter 3 (Employees) and Articles 3 and 4 Chapter 3 (Fire and Police) of the City of Fresno Municipal Code, respectively. The Systems provide lifetime retirement, disability, and death benefits to its members.
The Systems are administered by their respective Retirement Boards (Boards) which operate in compliance with the City of Fresno Municipal Code, and also in accordance with the California Pension Protection Act of 1992. The Boards do not operate under the control of the City Council. Rather, the Boards have the sole and exclusive responsibility to administer the respective Systems in a manner that will assure prompt delivery of benefits and related services to the members and their beneficiaries.
Membership and Benefit Eligibility
All permanent full-time employees of the City, except sworn Fire and Police personnel, are eligible to participate in the Employees’ plan. The Fire and Police is one System with two tiers. Effective August 28, 2008, the City of Fresno added the Fire and Police Tier 2 for all full-time sworn Fire, Police and Airport safety personnel hired on or after that date (and closed the Fire and Police Tier 1 to new entrants). Employees become eligible for membership on their first day of full-time regular employment, and become fully vested after earning 5 years of service credit. Employees working in limited, interim, provisional, temporary, seasonal or part-time positions are not eligible to participate in the Systems. Participation is mandatory if an employee is eligible, except in the case of the City Manager, City Attorney, City Clerk, Department Heads and Council Assistants who may negotiate other retirement benefits if such an agreement is established by resolution of the Council as provided for in the Fresno Municipal Code (FMC) Section 5-318.
Total participants in each System were comprised of the following, as of June 30, 2022:
Employees Fire & Police Total
Active Members
Vested 1,384 856 2,240
Non-Vested 1,051 280 1,331
Total Active Members 2,435 1,136 3,571
Retirees and Beneficiaries of Deceased Retirees
Retirees, Currently Receiving Benefits 2,167 1,154 3,321 Inactive Vested Members 202 58 260
Total Retirees and Inactive Members 2,369 1,212 3,581 Grand Total 4,804 2,348 7,152
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 132 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Benefit Provisions
The retirement (pension) benefits that Employees members receive are based upon a combination of age at retirement, years of credited service, final average monthly salary, and the distribution option selected by the participant. For Fire and Police, the benefits are further based upon the tier and option selected by the participant. Members' contributions, including interest, are 100% vested at all times. Employer contributions do not become vested until completion of five years of credited service, and are not payable until the member attains the age of 55. Effective January 28, 2008, members may retire between ages 50-55 with an actuarially equivalent service retirement benefit.
For Fire and Police, the employer contributions do not become vested until completion of ten years of credited service under Tier 1 and five years of credited service under Tier 2. Those benefits are not payable until the member attains the age of 50 under both tiers. Contributions are made by the members and the employer at rates recommended by the Systems’ actuary and adopted by the Boards.
Member Retirement Benefits
Employee members are eligible for service retirement benefits upon completion of at least five years of service upon termination of service (if they have left their contributions and interest with the System) and are at least age 55. They are also eligible if their permanent termination from City service was caused by a layoff. In those cases, they can retire at age 50 at a reduced benefit. They may also be eligible for service retirement benefit if they have less than five years of service with the City, have established reciprocity with a prior employer, and are eligible to retire from that agency.
The service retirement monthly benefit calculated pursuant to the provisions of the Fresno Municipal Code is equal to 2% of final compensation times each of the first 25 years of accrued retirement service credit plus 1% of final compensation times any years of accrued retirement service credit in excess of 25 years, multiplied by the age factor at retirement age. Final average compensation consists of the highest average consecutive 36 months of earnable compensation calculated using the rate of pay in effect at the time of retirement.
Fire and Police members of Tier 1 are eligible to retire once they attain the age of 65 regardless of service, or at age 50 and have acquired ten or more years of retirement service credit. The Tier 1 monthly benefit for a member with at least 20 years of service who retires from active status is equal to 55% of final compensation plus 2% of final compensation for each year of service in excess of 20 years completed after age 50. For Tier 1, final average compensation consists of the final highest consecutive 36 months of compensation earnable calculated using the rate of pay actually earned by the member in effect at the time of retirement. Some members can elect to have their final compensation based on a rank average. Members of Tier 2 are eligible to retire once they attain the age of 65 regardless of service or at age 50 and have acquired 5 or more years of retirement service credit. The Tier 2 monthly benefit for a member who is age 55 or older is equal to 2.70% of final compensation times years of accrued retirement service credit. The maximum monthly retirement allowance is 75% of final compensation. Tier 2 final average compensation consists of the highest consecutive 36 months of compensation earnable before the date of retirement.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
133 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS The members of each System may elect an unmodified retirement allowance, or choose one of four optional retirement allowances. Each of the optional retirement allowances require a reduction in the unmodified retirement allowance in order to allow the members the ability to provide certain benefits to a surviving spouse, domestic partner, or named beneficiary having an insurable interest in the life of the member. For Employee members, the unmodified retirement allowance provides the highest monthly benefit and 50% continuance to an eligible surviving spouse or domestic partner.
For Fire and Police members, the unmodified retirement allowance also provides the highest monthly benefit and a 66 2/3% continuance to an eligible surviving spouse or domestic partner.
The Municipal Code provides that the Retirement staff must research the percentage change in the Consumer Price Index (CPI) (US city-average for urban wage earners and clerical workers - all items) and propose that percentage to the appropriate Boards as the cost-of-living adjustments (COLA) to be adopted for the following year. This procedure must be completed by the end of April of each year for implementation in July (employees) or January (public safety). The COLA is limited to a 5% maximum change per year (employee) or 3% maximum change (public safety). Any excess over the maximum change is “banked” for use in a year where the percent of CPI change is less than the maximum.
The Fire and Police Tier 1 COLA depends on the type of method chosen by the member at retirement.
If the member chose the Career Rank method, the COLA is a recalculation of his/her retirement based on the new salaries adopted for the current year. If the method chosen by the retiree is the final 3- year method, the COLA is based on the change in the weighted mean average compensation attached to all ranks in the department, with a cap of 5% per year. Any excess over the 5% is “banked” for use in years when the COLA calculated is less than 5%.
Each System also has a Deferred Retirement Option Program (DROP), which is an optional voluntary program that allows the member to have his or her retirement benefits deposited in a special account within the Systems while the member continues to work in his or her current position. It is a voluntary method of receiving a distribution of their retirement benefits; it is not an additional retirement benefit. Additional information on DROP may be found in the ACFR for each respective System.
Terminated Member Benefits
If a member terminates before earning five years of credited service, the member forfeits the right to receive his or her service retirement benefit and is entitled to withdraw refundable contributions made, together with accumulated interest. If the member enters a reciprocal retirement system within 180 days (6 months) of terminating employment with the City and elects to leave their accumulated contributions on deposit with the System, then the member will receive a deferred retirement allowance when eligible.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
134 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Death and Disability Benefits
Death benefits are based upon whether the death occurred before or after retirement. Disability benefits are based upon whether the member has at least ten years of credited service, over or under age 55 and whether the permanent incapacity is found to be service or non-service connected.
Basis of Accounting
The Systems’ financial statements are prepared using the accrual basis of accounting and in accordance with generally accepted accounting principles in the United States of America (GAAP), under which revenues are recognized when earned and deductions are recorded when the liability is incurred. Securities lending transactions are accounted for in accordance with GASB Statement No. 28, Accounting and Financial Reporting for Securities Lending Transactions.
Valuation of Investments
For financial reporting purposes, the Systems’ investments are reported at fair value. Fair value for investments of publicly traded securities is based upon closing sales prices reported on recognized securities exchanges on the last business day of the period or, for listed securities having no sales reported and for unlisted securities, based upon last reported bid prices. All purchases and sales of securities are accounted for on a trade date basis. Dividends declared but not received are accrued on the ex-dividend date. Short-term investments are reported at cost, which approximates fair value.
Securities traded on national or international exchanges are valued at the last reported sales price at current exchange rates. Investments in both bonds and mortgage backed pass-through certificates are carried at fair value. Cost values are derived from Master Custodial Transaction Records. The fair value of real estate investments is based on independent appraisals. Investments that do not have an established market are reported at estimated fair values.
For asset/liability calculation purposes and for actuarial purposes, asset valuation is based on market value of assets less unrecognized returns from each of the last five years. Unrecognized returns are equal to the difference between the actual market return and the expected return on a market value basis and are recognized over a five-year period. The Actuarial Value of Assets is reduced by the value of the non-valuation reserves.
Rate of Return
For the fiscal year ended June 30, 2022 , the annual money-weighted rate of return on pension plan investments, net of investment expense was 7.28%, for the Employees and Fire and Police. The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
135 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Reporting
The following data is for employer reporting as required by GASB Statement No. 68 as of June 30, 2022. The results used in preparing the GASB Statement No. 68 report are comparable to those used in preparing the GASB Statement No. 67 report for the plan based on a reporting date and measurement date as of June 30, 2021. The valuation is based upon:
• The benefit provisions of the Systems as administered by the Boards; • The characteristics of covered active members, terminated vested members, and retired members and beneficiaries as of June 30, 2021;
• The assets of each Plan as of June 30, 2021;
• Economic assumptions regarding future salary increases and investment earnings; and • Other actuarial assumptions, regarding employee termination, retirement, death, etc.
The Total Pension Liability (TPL) and the Plans’ Fiduciary Net Positions include liabilities and assets held for DROP, Post-Retirement Supplemental Benefits (PRSB) and City Surplus reserves. The Net Pension Liability (NPL) is equal to the difference between the TPL and the each Plan’s Net Position.
Each Plan’s Fiduciary Net Position is equal to the market value of assets and, therefore, the NPL measure is very similar to an Unfunded/(Prefunded) Actuarial Accrued Liability calculated on a market value basis. The NPL was measured as of June 30, 2021 and determined from the actuarial valuations as of June 30, 2021 . The Plans’ Fiduciary Net Positions (Plan Assets) were valued as of the measurement dates. Consistent with the provisions of GASB Statement No. 68, the assets and liabilities measured as of June 30, 2021 were not adjusted or rolled forward to the June 30, 2022 reporting date. The discount rates used for each Plan to determine the TPL and NPL as of June 30, 2021 was 7.00%, following the same assumptions used by the Retirement Systems in the funding valuations as of the same dates.
Funding Policy
The City contributes to the retirement plans based upon actuarially determined contribution rates adopted by the Boards. Employer contribution rates are adopted annually based upon recommendations received from the Retirement Systems' actuary after the completion of the annual actuarial valuation.
For the Employees System, the average employer contribution rate as of June 30, 2022, for 2021-2022 (based on the June 30, 2019 valuation) was 13.35% of compensation. The average employee member contribution rate as of June 30, 2022 for 2021-2022 (based on the June 30, 2019 valuation) was 9.49% of compensation.
For the Fire and Police System, the average employer contribution rate as of June 30, 2022 , for 2021-2022 (based on the June 30, 2019 valuation) was 22.56% of compensation. The average employee member contribution rate as of June 30, 2022 for 2021-2022 (based on the June 30, 2019 valuation) was 8.89% of compensation.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
136 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS All active Fire and Police members are required to make contributions to the System. Employee contribution rates vary in the First Tier according to entry age. The Tier 1 average member contribution rate as of June 30, 2022 for 2021-2022 (based on the June 30, 2019 valuation) was 0.00% of compensation. Employee contribution rates in the Second Tier are established at 9% of pensionable base pay.
The aggregate employer contribution rate for the Fire and Police System as of June 30, 2022 for 2021-2022 (based on the June 30, 2019 valuation) was 22.56% of compensation.
Actuarial Funding Policy and Actuarial Cost Methodology for Funding Purposes The City currently funds, at a minimum, the amounts recommended by the actuary and approved by the Boards. These minimum contributions are recognized currently in each System’s statement of changes in fiduciary net position. Employees' contributions are funded and recognized currently through payroll deductions in amounts recommended by the actuary. Costs of administering the System are charged against System assets.
Funding Status and Method
The Employees System Board adopted a Comprehensive Actuarial Funding Policy on November 7, 2012. For the Employees Retirement System, this policy included a change in actuarial cost methodology from the Projected Unit Credit (PUC) method previously used for funding purposes to the Entry Age Normal (EAN) method.
On the same date, the Fire and Police Board adopted a Comprehensive Actuarial Funding Policy. For the Fire and Police Retirement System, this policy included a change in actuarial cost methodology from the aggregate EAN funding method to the individual EAN method. The Boards made the change due to the adoption of GASB Statement No. 67 in fiscal year 2014.
Funding Requirements and Policy Components
The Systems’ annual funding requirements are comprised of a payment of the Normal Cost and a payment on the Unfunded Actuarial Accrued Liability (UAAL), if applicable. The Normal Cost and the amount of the payment on UAAL are determined by three components of the respective Board’s funding policy: 1) Actuarial Cost Method - the techniques used to allocate the cost/liability of retirement benefits to a given period; 2) Asset Smoothing Method - the techniques that spread the recognition of investment gains or losses over a period of time for the purposes of determining the Actuarial Value of Assets used in the actuarial valuation process; and 3) Amortization Policy - the decisions on how, in terms of duration and pattern, to fund the difference between the UAAL and the Actuarial Value of Assets in a systematic manner.
As of June 30, 2022, the Systems did not have UAAL.
The Boards adopted an Amortization Policy, which sets forth the amortization procedures for funding any UAAL or amortization and allocation of any available Surplus in the Systems. A detailed CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
137 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS description of the policy can be found in the Notes to the Financial Statements for the Retirement Systems, which are located at http://www.cfrs-ca.org/Employee/Communications/Reports.asp for the Employees System or at http://www.cfrs-ca.org/Fire-Police/Communications/Reports.asp for the Fire and Police System.
The Systems use a 5-year smoothing of market gains and losses above and below the assumed actuarial rate of return to derive the actuarial value of assets. As of the fiscal year ended June 30, 2022, the actuarial valuation value of the Employees’ System assets was $ 1.450 billion with a funded percentage of 113.7% on a valuation value of assets, whereas the actuarial value of Fire and Police assets was $1.791 billion with a funded percentage of 120.5% on a valuation value of assets.
Contributions Required and Contributions Made
The employer’s required normal contributions to the Systems have two components: basic and COLA.
For fiscal year 2022, the City’s required normal contributions (basic and COLA) to the Systems were as follows (in thousands):
Normal Cost
Employees System
FY 2022
Employer Contributions $ 21,950
Prior Year Contribution (Surplus)/Shortfall 70
Net Employer Contributions $ 22,020
Pensionable Payroll $ 154,031
Member Contributions $ 15,493
Employer Contribution Rate 13.33%
Employer and employee contributions represented 13.35% and 9.49% respectively, of the fiscal year 2022 covered payroll for the Employees System.
Normal Cost
Fire and Police System
(In Thousands)
FY 2022
Tier 1 Tier 2 Total
Employer Contributions $ 340 $ 30,594 $ 30,934
Prior Year Contribution (Surplus)/Shortfall (93) (3,285) (3,378) Net Employer Contributions $ 247 $ 27,309 $ 27,556
Pensionable Payroll $ 1,563 $ 121,070 $ 122,633
Member Contributions $ 92 $ 10,881 $ 10,973
Employer Contribution Rate 28.76% 25.27 %
Employer and employee contributions represented 22.56% and 8.89%, respectively, of the fiscal year 2022 covered payroll for the Fire and Police System.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
138 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Net Pension Asset
The net pension liability (asset) reported as of June 30, 2022 was measured as of June 30, 2021 , and determined based upon the total pension liability (on GASB Statement No. 68 basis) from actuarial valuations as of June 30, 2021.
The City’s total pension liability, plan fiduciary net position, and net pension liability (asset) for each System as of June 30, 2022 were as follows (in thousands):
Employees
System
Fire and Police
System
Total Pension Liability $ 1,379,432 $ 1,636,521
Plan Fiduciary Net Position (1,731,238) (2,090,370)
Net Pension Liability (Asset) $ (351,806) $ (453,849)
Plan Fiduciary Net Position as a percentage of the total pension liability 125.5% 127.73%
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
139 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Changes in Net Pension Liability (Asset)
The components of the net pension liability (asset) for each System as of June 30, 2022 and a measurement date of June 30, 2021 were as follows (in thousands):
Employees
System
Fire and Police
System
Total Pension Liability (Asset)
Beginning Balance $ 1,337,308 $ 1,565,630
Service Cost 30,993 37,563
Interest 93,357 109,740
Differences Between Expected & Actual Experience (12,980) (5,449) Benefit Payments, Including Refunds (69,246) (70,963) Changes of Assumptions — —
Net Change in Total Pension Liability 42,124 70,891
Ending Balance $ 1,379,432 $ 1,636,521
Plan Fiduciary Net Position
Beginning Balance $ 1,360,837 $ 1,635,300
Contributions - Employer 20,144 26,315
Contributions - Employee 13,750 10,256
Net Investment Income 407,811 491,744
Benefit Payments (Including Refunds, PRSB) (69,246) (70,963) Administrative & Professional Expense (2,058) (2,282) Net Change in Plan Fiduciary Net Position 370,401 455,070 Ending Balance 1,731,238 2,090,370
Net Pension Liability (Asset) $ (351,806) $ (453,849) CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
140 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Discount Rate and Sensitivity of the Net Pension Liability to Changes in the Discount Rate The discount rate used to measure the TPL was 7.00% as of June 30, 2021 and June 30, 2020 . The projection of cash flows used to determine the discount rate assumed plan member contributions will be made at the current contribution rate and that employer contributions will be made at rates equal to the actuarial determined contribution rates. For this purpose, only employer contributions that are intended to fund benefits for current plan members and their beneficiaries are included.
Projected employer contributions that are intended to fund the service costs for future plan members and their beneficiaries, as well as projected contributions from future plan members, are not included. Based on those assumptions, the pension Plan Fiduciary Net Position was projected to be available to make all projected future benefit payments for current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the TPL as of both June 30, 2021 and June 30, 2020.
The following presents the NPL of the Employees and Fire and Police Retirement Systems as of June 30, 2021. The Systems use the current discount rate to measure the TPL for the measurement date of June 30, 2021 , as well as what the NPL would be if it were calculated using a discount rate that is 1- percentage-point lower (6.00%) or 1-percentage-point higher (8.00%) than the current rate:
NPL of Employees and Fire and Police Retirement Systems As of June 20, 2021
(In Thousands)
1% Decrease Current
Discount Rate 1% Increase
6.00% 7.00% 8.00%
Employees System $ (190,533) $ (351,806) $ (483,823)
Fire and Police System (228,661) (453,849) (634,724) Long-Term Expected Real Rate of Return
The long-term expected rate of return on the Systems’ investments was determined using a building- block method in which expected future real rates of return (expected returns, net of pension plan investment expense and net of inflation) are developed for each major asset class. This information is combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation and deducting expected investment expenses and a risk margin. The target allocation and projected arithmetic real rates of return for each major asset class, after deducting inflation, but before deducting investment expense, used in the derivation of the long-term expected rate of return assumption are summarized in the following table:
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
141 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Asset Class/Target Allocation/Long-Term Expected
Rate Return Table
As of June 30, 2022
Asset Class
Target Asset
Allocation
Weighted Average
Long-Term Expected
Rate of Return
(Arithmetic)
Large Cap U.S. Equity 18.0% 5.4%
Small Cap U.S. Equity 3.0% 6.17%
Developed International Equity 13.0% 6.13%
Emerging Market Equity 5.0% 8.17%
Private Equity 8.0% 7.18%
U.S. Core Bonds 1.3% 9.53%
Domestic Fixed Income 12.0% 39%
High Yield Bonds —% —%
Private Debt/Direct Lending 14.0% 5.93%
Midstream Energy —% —%
Real Estate 15.0% 4.59%
Private Real Assets - Infrastructure/Land 7.0% 6.19%
Private Credit - Credit Opportunities 2.5% 7.18%
Hedge Fund Macro 1.3% 2.72%
Total 100.0%
Mortality Rates
For the Employees System, the mortality rates used in the latest actuarial valuation are based on Pub-2010 General Healthy Retiree Amount-Weighted Mortality Table (separate tables for males and females) times 105% for healthy members and beneficiaries, projected generationally with the two- dimensional mortality improvement scale MP-2018. For disabled members, the mortality rates used in the latest actuarial valuation are based on Pub-2010 Non-Safety Disabled Retiree Amount-Weighted Mortality Table (separate tables for males and females), projected generationally with the two- dimensional mortality improvement scale MP-2018.
For the Fire and Police System the mortality rates used in the latest actuarial valuation are based on Pub-2010 Safety Healthy Retiree Amount-Weighted Mortality Table (separate tables for males and females) for healthy members, projected generationally with the two-dimensional mortality improvement scale MP-2018. For Beneficiaries, Pub-2010 General Healthy Retiree Amount Weighted Mortality Table (separate tables for males and females) times 105%, projected generationally with the tw0-dimentional mortality improvement scale MP-2018. For disabled members, Pub-2010 Safety Disabled Retiree Amount-Weighted Mortality Table (separate tables for males and females), projected generationally with the two dimensional mortality improvement scale MP-2018. These mortality tables were adjusted to future years using the generational projection to reflect future mortality improvement between the measurement date and those years.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
142 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Actuarial Assumptions
The TPL as of June 30, 2021 was determined by an actuarial valuation as of June 30, 2021 . The actuarial assumptions used in the valuation were based on the results of an experience study for the period from July 1, 2015 through June 30, 2018.
In particular, the following actuarial assumptions were applied to all periods included in the measurement:
Inflation 2.75%
Salary increases
3.75% to 11.25%, varying by service, including inflation (Employees).
4.00% to 12.75%, varying by service, including inflation (Fire and Police).
Investment rate of return 7.00%, net of pension plan investment expense, including inflation.
Other assumptions
See the Employees' Plan and the Fire and Police Plan June 30, 2022 Actuary Reports for the service retirement rates after they have been adjusted to treat DROP participation as service retirement.
Net Position Restricted for Pension Benefits
Net position restricted for pension benefits is segregated into Active Members Reserve (members’ accumulated contributions) and reserves established by the Boards for various benefit payments.
Reserves are established by the Systems from member and employer contributions and the accumulation of investment income after satisfying investment and administrative expenses.
Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions For the fiscal year ending June 30, 2022 , the City incurred pension expense of $36.2 million for the employees Plan and $39.6 million for the Fire and Police Plan for a total pension expense of $75.8 million.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
143 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS As of June 30, 2022, the City has deferred outflows and deferred inflows of resources related to the pensions as follows:
Pension Expense and Deferred Outflows and Inflows of Resources (in thousands) Employees Fire and Police
Components of Pension Expense System System
Service cost $ 30,993 $ 37,563
Interest on the total pension liability 93,357 109,740 Expensed portion of current-period difference between expected and actual experience in the Total Pension Liability (3,489) (1,261) Actual member contributions (13,750) (10,256)
Projected earnings on plan investments (93,949) (113,187) Expensed portion of current-period differences between actual and projected earnings on plan investments (62,772) (75,711) Expensed portion of current-period effects of Assumption Changes — — Administrative expense 2,058 2,282
Recognition of beginning of year deferred outflows of resources as pension expense 31,922 39,207 Recognition of beginning of year deferred inflows of resources as pension expense (20,541) (28,024) Pension Expense $ (36,171) $ (39,647)
Deferred Outflows of Resources and Deferred Inflows of Resources Deferred Outflows of Resources
Contributions subsequent to Measurement Date $ 20,805 $ 25,539 Changes of assumptions or other outputs 7,605 21,889
Difference between expected and actual experience in the Total Pension Liability 2,564 1,335 Net difference between projected and actual earnings on pension plan investments — — Deferred Outflows of Resources $ 30,974 $ 48,763
Deferred Inflows of Resources
Net difference between projected and actual earnings on pension plan investments $ 198,793 $ 240,358 Changes of assumptions — 8,249
Difference between expected and actual experience in the Total Pension Liability 9,585 6,893 Deferred Inflows of Resources $ 208,378 $ 255,500
The $20.8 million and $25.5 million reported as deferred outflows of resources related to contributions subsequent to the June 30, 2021 measurement date will be recognized as a reduction of the total Pension liability during the fiscal year ending June 30, 2023. Deferred outflows of resources and deferred inflows of resources related to pension will be recognized as follows:
2022 N/A N/A
2023 $ (40,299) $ (48,268)
2024 (44,873) (47,169)
2025 (50,265) (60,724)
2026 (62,772) (76,115)
Thereafter — —
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
144 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Any differences between projected and actual investment earnings on pension plan investments are recognized over a period of five years beginning with the year in which they occur. Differences between expected and actual experiences are recognized over the average of the expected remaining service lives of all employees that are provided with pensions through the Retirement Systems determined as of June 30, 2020 (the beginning of the measurement period ending June 30, 2021) and is 3.61 years for the Employees System and 4.32 years for the Fire & Police System.
Administrative Expenses
The Fresno Municipal Code (FMC) provides that all administrative costs of the Systems shall be a charge against the assets of the Systems. Per the FMC, the Administrative expenses are a component of the City’s contribution calculation.
The Systems issue publicly available financial reports that include financial statements and required supplementary information for the Employees Retirement System and the Fire and Police Retirement System. The reports may be obtained by writing the City of Fresno Retirement Office, 2828 Fresno Street, Suite 201, Fresno, California 93721, or by visiting:
https://www.cfrs-ca.org/employee-retirement-system/ers-financial/ for the Employee System, or https://www.cfrs-ca.org/fire-and-police-retirement-system/financial/ for the Fire and Police System.
Successor Agency Retirement Plan
The Successor Agency participates in a public agency cost-sharing multiple-employer defined benefit pension plan (the Plan) administered by the California Public Employees' Retirement System (CalPERS). Employer contribution rates are determined on an annual basis by an actuary and are effective on the July 1 following notice of a change in the rate.
The Plan fiduciary net position disclosed in the Successor Agency’s accounting valuation may differ from the Plan assets reported in the Successor Agency’s funding actuarial valuation report due to CalPERS keeping various items included in its fiduciary net position which are excluded for rate setting purposes in the Successor Agency’s funding actuarial valuation. Differences may also result from timing of financial reporting by CalPERS and final reconciled reserves.
As of the beginning of the measurement period (July 1, 2021), the net pension liability for the Plan is $574,573. For the measurement period ended June 30, 2022 (the measurement date), the net pension liability for the Plan is $ 317,599 and the Successor Agency incurred pension expense of $83,431 for the Plan.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
145 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS As of June 30, 2022 , the Successor Agency reports other amounts for the Plan as deferred outflows and deferred inflows of resources related to pensions as follows (in thousands):
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Contributions made after the measurement date $ 53 $ —
Difference between expected and actual experience 36 — Changes in assumptions — —
Net difference between projected and actual earnings on pension plan investments 277 Changes in employer's proportions 20 —
Difference between the employer's contributions and the employer's proportionate share of contributions — 58
Total $ 109 $ 335
For more detailed information related to the Successor Agency’s retirement plan, refer to the Successor Agency’s separate audited financial statements which can be obtained by contacting the Successor Agency at 2344 Tulare Street, Suite 200, Fresno, CA 92721.
B. Deferred Compensation Plan
The City offers its employees a deferred compensation plan in accordance with Internal Revenue Code (IRC) Section 457. The deferred compensation plan (the Plan), available to all permanent full- time and part-time employees and Council Members, permits deferral of a portion of the employee’s salary into a tax-deferred program. The deferred compensation is not available to employees or other beneficiaries for withdrawal until termination, retirement, death, or unforeseeable emergency, or loan program. Upon separation from employment with the City, an individual may roll over their deferred account into another IRS Allowable Plan or, upon receipt, the distribution will become taxable.
The Deferred Compensation Board contracted with Fidelity Management Trust Company (Fidelity) as the trustee and plan administrator. The City’s Retirement System Administration assists Fidelity in the administration of the Plan. In addition to the Retirement Office, City staff in the Payroll section of the Finance Department, the City Attorney’s Office, and Information Services Department all assist in the administration of the Plan. The City has no fiduciary accountability for the Plan. Accordingly, the Plan assets and related liabilities to Plan participants are not included in the basic financial statements.
C. Compensated Absences
Vacation pay, which may be accumulated up to 600 hours depending on an employee’s bargaining group and length of service, is payable upon termination. Sick leave, which may be accumulated up to 12 hours per month, has no maximum. If eligible, most bargaining units receive a portion of the value of their sick leave balance at termination in their Health Reimbursement Account (HRA).
Otherwise, employees do not receive any value from their sick leave balances at termination.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
146 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Annual leave, which may be accumulated up to 1,200 hours, depending upon bargaining unit and length of service, is payable upon termination or retirement. Holiday leave may be accumulated indefinitely depending upon the bargaining groups and is payable for active employees as well as at termination or retirement. Annual leave allows for the cashing out of the higher of 10% of the accumulated balance or 48 hours, once per fiscal year. Supplemental sick leave is awarded to unrepresented management, professionals and to white collar employees at the rate of 40 hours at the beginning of each fiscal year. The balance can only be used after other leave balances are exhausted, or for other specific reasons outlined in the various Memoranda of Understanding (MOU’s) or the current Salary Resolution. The balance is payable at termination/retirement or is accounted for as part of an HRA which is unfunded and expended on a pay-as-you-go basis.
Starting in fiscal year 2006, some bargaining units selected to account for some or all of their sick leave and supplemental sick leave balances as an HRA. The book value of these balances is accounted for (by employee) in off-line spreadsheets, administered by HealthComp, is given credit for calculated interest, and is used to pay health premiums for the employee, their spouse and dependents until their individual balance is exhausted. The HRA is not held in a trust, but is funded on a pay-as-you-go-basis.
The portion of the City's obligation relating to employees' rights to receive compensation for leave balances attributable to services already rendered is accrued when incurred in the Government-Wide, Proprietary, and Fiduciary Fund Financial Statements. Compensated absences upon termination are funded through a cost allocation formula which is based upon a citywide history of payouts (approximately $2 million per year). Accruals are reviewed by bargaining unit and the $2 million base is allocated in proportion to each unit’s current liability for a contribution per unit cost. This unit cost is then converted to a cost per employee and becomes part of the budgeted employee service cost in each department’s annual base budget.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
147 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Accrued Employee Leave balances as of June 30, 2022, are as follows (in thousands):
Department/Activity
Total Accrued
Vacation,
Sick Leave, and HRA
Current
Portion
Governmental Activities:
General Fund $ 74,959 $ 10,070
Grants Special Revenue Fund 1,399 104
High Speed Rail — 2
Special Gas Tax 902 100
Measure C 1,692 210
Measure P 269 4
Community Services 394 45
City Combined — 47
Special Assessment 272 1
General Services 4,021 420
Risk Management 212 39
Total Governmental Activities $ 84,120 $ 11,042
Business-Type Activities:
Water System $ 2,250 $ 306
Sewer System 2,248 388
Solid Waste Management 1,755 313
Transit 3,600 693
Airports 1,921 385
Convention Center — —
Community Sanitation 359 36
Parks and Recreation 4 1
Billing and Collection 1,746 275
Total Business-Type Activities $ 13,883 $ 2,397
Fiduciary Funds:
Private-Purpose Trust Fund $ 56 $ 16
Total $ 98,059 $ 13,455
Accrued employee leave balances related to governmental activities are recorded in the Government- Wide Financial Statements under Long-Term Liabilities.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
148 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS D. Termination Benefits
During fiscal year 2022, there were no employees who received severance pay.
E. Health Benefit Plan
The City offers its employees participation in the Fresno City Employees Health and Welfare Trust Plan (Trust). The Trust offers a self-insured medical plan for full-time and permanent part-time employees and their dependents. The Trust also provides dental, vision, pharmacy, mental health, and chiropractic coverage.
There are two medical plan options available to employees. Employees have the opportunity, on an annual basis, to elect either a higher benefit level Preferred Provider Organization (PPO) option or a reduced benefit level PPO option. Employees electing to receive the higher benefit level option pay a percentage of the monthly premium through payroll deductions. Employees electing the lower benefit level pay nothing for their coverage.
The first option is a higher benefit level PPO plan which has a $200 individual annual deductible and a $600 family maximum annual deductible. Under this option, the plan pays 80% of covered charges and the employee is responsible for 20% of the covered charges. Once a covered member incurs $15,000 in covered charges, the plan then pays 100% until the end of the plan year.
The second option is a reduced benefit level PPO plan which has a $1,300 individual annual deductible with a $2,600 family maximum annual deductible. The benefit reduction amount is set by the Board of Trustees for the plan and depends on the amount of contributions received by the Trust on behalf of the employee.
The percentage of the premium the employee is required to pay to receive the higher benefit level is negotiated by each bargaining unit.
During fiscal year 2014, a number of units negotiated a 75% - 25% contribution split. For these units, the City contributes 75% of the premium and the employees, if they wish to have the higher benefit level PPO, contribute 25% of the premium. If they choose not to make the contribution, the medical benefits are reduced by 30%. This reduction results in the plan paying 56% of covered charges and the employee is responsible for 44% of covered charges.
Only one bargaining unit continues to have a different contribution amount than the balance of the Unions. For Fresno City Employees Association, Inc. (FCEA) employees hired after July 11, 2011, the City contributes 70% of the premium and the employees, if they wish to have the higher benefit level PPO, contribute 30% of the premium. If they choose not to make the contribution, the medical benefits are reduced by 35%. This reduction results in the plan paying 52% of covered charges and the employee is responsible for 48% of covered charges. Employees in the FCEA hired before July 11, 2011, continue to have an 80% - 20% contribution split as described above.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
149 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS City retirees are also eligible for participation in the plans by paying the full blended premium cost.
The City continues to assess the impact of the federal healthcare reform legislation on the City’s liabilities.
The Health and Welfare Trust Board approved the purchase of a $500,000 stop-loss insurance policy on May 11, 2016. The policy was purchased in fiscal year 2017. The purpose of the policy was to protect the Trust from having to pay any claim or series of claims associated with one case that totaled more than $500,000. In addition to the stop-loss insurance, the Health and Welfare Trust Board also approved a policy of setting aside a portion of the Health and Welfare Trust Fund's fund balance for the payment of catastrophic health claims.
F. Other Post-Employment Benefits
Plan Description
The City of Fresno Retirees Healthcare Plan is a single-employer defined benefit medical plan administered by HealthComp and funded through the City of Fresno Health and Welfare Trust. It is reported as an Internal Service Fund of the City and provides Other Post-Employment Benefits (OPEB) to eligible retirees and his/her dependents, spouse or domestic partner. The City does not accumulate assets in a dedicated trust, or equivalent arrangement, for the purpose of funding its retirement healthcare obligation. Therefore, the actuarial value of plan assets are zero. The trust does not issue separate publicly available financial statements.
GASB Statement No. 75, Accounting and Financial Reporting by Employers for Post-Employment Benefits Other than Pensions , requires governments to account for OPEB on an accrual basis of accounting, rather than on a pay-as-you-go basis. The effect is the recognition of an actuarially determined expense on the Statement of Activities when a future retiree earns their post- employment benefits, rather than when they use their post-employment benefits. The post- employment benefit liability is recognized on the Statement of Net Position over time.
Contributions
The City provides post-employment healthcare benefits for certain eligible retirees. OPEB includes the authorization for retirees to purchase health insurance through the plan at current employee rates. The establishment and amendment of benefit provisions are negotiated between the employee bargaining units and the City, and are recommended by the City Manager subject to the approval of the Mayor and the City Council. While participant retirees pay 100% of their premium costs, they are allowed to purchase insurance at blended premium rates. Thus, the City's contribution is deemed to be that portion of retiree claims costs over premiums required to be contributed by retirees. Currently, the City does not pre-fund retiree health benefits and instead provides for benefits on a pay-as-you-go basis.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
150 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Employees Covered
As of July 1, 2021, the following employees were covered by the benefit terms:
Inactive employees or beneficiaries currently receiving benefit payments 234 Inactive employees entitled to but not yet receiving benefit payments — Active employees 3,308
Total participants covered by OPEB Plan 3,542
Net OPEB Liability
The City's net OPEB liability of $99.8 million was measured as of June 30, 2021, and was determined by an actuarial valuation as of that date to determine the June 30, 2022 total OPEB liability.
Actuarial Assumptions and Other Inputs
The net OPEB liability was determined using the following actuarial assumptions and other inputs, applied to all periods included in the measurement, unless otherwise specified:
Reporting Date June 30, 2022
Measurement Date June 30, 2021
Valuation Date July 1, 2021
Discount Rate 3.54%
Healthcare Cost Trend Rates:
Current Year Trend 0
Second Year Trend 7.00% / 4/24%
Decrement NA
Ultimate Trend 4.24%
Year Ultimate Trend is Reached 2090 / 2023
Salary Increases 3.00%
Actuarial Cost Method Entry Age Normal (Percent of Salary) The discount rate was based on the index provided by Bond Buyer 20-Year General Obligation Index based on the 20 year AA municipal bond rate as of June 30, 2020.
Mortality rates were based on the SOA RP-2014 Total Dataset Mortality with Scale MP-2019 (Base Year 2006).
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
151 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Sensitivity of the Net OPEB Liability to Changes in the Discount Rate The July 1, 2021 valuation was prepared using a discount rate of 3.54%. If the discount rate were 1% higher than what was used in this valuation, the Net OPEB Liability would decrease to $ 87.8 million or by (12.02)%. If the discount rate were 1% lower than was used in this valuation, the Net OPEB Liability would increase to $114.4 million, or by 14.70%. 1% Decrease Current
Discount Rate 1% Increase
2.54% 3.54% 4.54%
Net OPEB Liability
(in thousands) $ 114,428 $ 99,761 $ 87,774
Sensitivity of the Net OPEB Liability to Changes in the Healthcare Cost Trend Rates The July 1, 2021 valuation was prepared using an initial trend rate of 0.0%. If the trend rate were 1% higher than what was used in this valuation, the Net OPEB Liability would increase to $118.6 million or by (18.93)%. If the trend rate were 1% lower than was used in this valuation, the Net OPEB Liability would decrease to $84.9 million or by 14.94%.
1% Decrease
Current
Healthcare Cost
Trend Rates
1% Increase
-1% 0.0% 1%
Net OPEB Liability
(in thousands) $ 84,858 $ 99,761 $ 118,649
Changes in the Net OPEB Liability
The changes in the Net OPEB Liability for the City OPEB Plan are as follows:
Net OPEB Liability
Increase / (Decrease)
(in thousands)
Net OPEB Liability as of June 30, 2021 $ 152,604
Changes for the Year:
Service Cost 6,604
Interest 3,221
Assumption Changes (40,728)
Benefit Payments (2,912)
Net Changes (52,843)
Net OPEB Liability as of June 30, 2022 $ 99,761
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
152 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS OPEB Expense, Deferred Outflows of Resources, and Deferred Inflows of Resources For the year ended June 30, 2022, the City recognized an OPEB expense of $13.7 million. At June 30, 2022, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources (in thousands):
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
OPEB Contributions Subsequent to the Measurement Date $ 2,078 $ — Changes of Assumptions 29,252 (51,472)
Difference Between Actual and Expected Experience 217 (22,208) Total $ 31,547 $ (73,680)
The $2.1 million reported as deferred outflows of resources related to contributions subsequent to the June 30, 2021 measurement date will be recognized as a reduction of the total OPEB liability during the fiscal year ending June 30, 2023. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows (in thousands):
Fiscal
Year
Deferred
Outflows/(Inflows)
of Resources
2023 $ (6,452)
2024 (6,452)
2025 (6,452)
2026 (6,452)
2027 (4,992)
Thereafter (13,410)
Total: $ (44,210)
G. Healthcare Plan Claims Liability
The recorded liability for the Employees Healthcare Plan at June 30, 2022 for employee health benefit claim payments for direct provider care is $7.4 million.
Changes in the funds claims liability amount for the last two fiscal years are as follows (in thousands):
Fiscal Year
Ended
June 30
Beginning of
Fiscal Year
Liability
Current Year
Claims and
Changes in
Estimates
Claims
Payments
End of
Fiscal
Year
Liability
2021 $ 4,100 $ 52,046 $ 49,646 $ 6,500
2022 6,500 50,685 55,732 7,400
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
153 NOTE 11 - EMPLOYEE BENEFIT PROGRAMS Note 12. No-Commitment Debt
The City is not liable for repayment of any of the following bonds, and accordingly, they are not reflected in the accompanying basic financial statements.
A. Special District Debt
The City is not obligated in any manner for the Special District debt, but is acting as an agent for property owners in collecting the taxes/assessments, forwarding the collections to the trustee/paying agent, and initiating foreclosure proceedings, if appropriate. Special District debt payable to bond holders was $2.57 million at June 30, 2022, as compared to $2.83 million at June 30, 2021.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 154 NOTE 12 - NO-COMMITMENT DEBT Note 13. Commitments and Contingencies
A. Closure and Post-Closure Care Cost
The City continues to monitor a former landfill site as part of the Environmental Protection Agency's (EPA) Superfund program. Management estimates the remaining monitoring costs as of June 30, 2022 to be $11.2 million. A liability in this amount has been recorded in the Solid Waste Management Fund. It is anticipated that approximately $ 0.8 million in monitoring costs and landfill site closure costs will be paid in fiscal year 2023. The former landfill site has not received solid waste since 1987.
It was redesigned as part of a 350-acre “green” facility to integrate the former landfill site into a championship caliber sports complex/regional park. The estimated total remaining post-closure care costs are based on the equipment, facilities, and services required to monitor/maintain the closed landfill. The liability for post-closure care costs is an estimate and subject to change resulting from inflation, deflation, technology or changes in applicable laws.
Fees paid by utility users will be used to cover the remaining monitoring costs. A receivable totaling $10.3 million has been recorded in the Solid Waste Management Fund.
B. CVP Water Contract
The City’s 60,000 acre-foot water supply entitlement from the United States Bureau of Reclamation (USBR, or the Bureau) is equivalent to approximately 40% of the City’s annual water demand. This supply, derived from the Friant Dam on the San Joaquin River, is the primary resource for the operation of the City’s current and future surface water treatment facilities.
The City and the Bureau have what is known as a Repayment Contract. While most traditional federal Reclamation Law provisions continue to apply, the City receives some important benefits by utilizing the Repayment Contract, including:
1. Permanent water supply - The Repayment Contract provides for an ongoing, permanent annual supply of up to 60,000 acre-feet of water from the Friant Division of the CVP. No further periodic renewal negotiations are required.
2. Pricing benefits - Certain components of the Bureau water rate structure, such as tiered pricing, are eliminated.
3. Financing cost savings - Under the previous Bureau rate structure, the City paid certain financing costs and interest on the outstanding capital and operation and maintenance obligations that the Bureau attributed to the City. Under a Repayment Contract, those costs are not passed on to the City.
Because repayment contracts do not require periodic renewal, compliance with the California Environmental Quality Act (CEQA) and the National Environmental Policy Act (NEPA) need not be repeated. This obligation is amortized and included in the volumetric water rates the City pays the USBR. The present value of the City’s debt obligation to the Bureau has been fully capitalized in the CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 155 NOTE 13 - COMMITMENTS AND CONTINGENCIES Water Fund under the caption “Unamortized CVP Water Settlement”, and is being amortized against expected future revenues generated through water rates. The “Unamortized CVP Water Settlement” totaled $ 0.8 million on June 30, 2022 , while the related liability reported as “CVP Litigation Settlement” totaled $0.1 million on June 30, 2022.
C. Other Litigation
There are various other lawsuits and claims pending against the City. Although the outcome of these claims and lawsuits is not presently determinable, management, after consultation with legal counsel, is of the opinion that a majority of these matters will not have a material adverse effect on the financial condition of the City at June 30, 2022.
D. Toxics Mitigation
Old Hammer Field
Contamination, primarily from the common solvent trichloroethylene (TCE), was discovered and identified in 1989 in soils and groundwater beneath property currently owned by the City. The site known as Old Hammer Field (OHF), a prior Army military base in the 1940’s, was the subject of investigation and cleanup efforts which had previously been jointly funded by the Boeing Company (Boeing), the U.S. Army Corps of Engineers and the City of Fresno. The area had been used for the repair, overhaul, maintenance, refurbishing and construction of aircraft during and after World War II. The California Department of Toxic Substances Control (DTSC) was the lead regulatory agency overseeing site cleanup.
After years of legal negotiations, a settlement agreement between the U.S. Army Corps of Engineers, the Boeing Company, and the City was reached. The settlement called for the Airports Department to be responsible, going forward, for 10% of the cleanup costs. The settlement also called for the U.S. Army Corps of Engineers and Boeing to make a joint one-time payment of $1,350,000 for past costs. This payment was made in fiscal year 2011.
The Court approved the settlement agreement which included the one-time payment noted above, covenants not to sue and an operating agreement for purposes of coordinating further efforts to implement the State-Approved Remedial Action Plan to obtain Site Closure. All parties agreed to bear their own costs and expenses, including attorney’s fees in the case.
A liability for future cleanup costs on the Old Hammer Field site is recorded on the fiscal year 2022 ACFR in the amount of $ 405,932. Total costs have been estimated to range between $10 and $20 million, with the City’s share of cleanup costs to be 10%. The cleanup time frame has also been estimated and is expected to continue for 20 to 40 years. Cleanup costs totaled $ 45,187 in fiscal year 2022.
The City will re-evaluate this accrual annually and make adjustments as necessary.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 156 NOTE 13 - COMMITMENTS AND CONTINGENCIES DBCP Groundwater Contamination
The occurrence of DBCP, an agricultural pesticide, in certain groundwater has been identified throughout the Fresno Metropolitan Area. At various City well sites, DBCP exceeds drinking water limits and is removed by Granular Activated Carbon (GAC) treatment. The City fronted the costs of clean up with respect to the known wells and reimbursed itself from a litigation settlement in an original amount of approximately $21 million. $10 million was stipulated to be used toward past costs, and $11 million was to be applied toward the installation of additional GAC treatment units, all of which have been completed. Subject to numerical limits, the settlement arrangement also provides for the City to be reimbursed for the capital costs of the installation of GAC treatments at wells exceeding maximum contaminant levels, with reimbursements ranging from $337,500 to $540,000 depending on the well site. Funding also is provided for the ongoing operation and maintenance cleanup costs of approximately $27,900 to $31,000 per contaminated well (depending on type), adjusted for inflation, with such payment obligations ending on June 26, 2035. The City is not responsible for “cleanup” in the context common to hazardous material remediation.
The City can elect to treat wells or simply shut them down. Future costs to clean up and monitor new discoveries of contamination at existing sites or additional sites that may be identified are eligible for reimbursement under the settlement agreement through June 26, 2035.
An obligating event as defined by GASB Statement No. 49 has not occurred during the fiscal year; therefore, no liability exists.
Pollution Remediation
Although the Successor Agency is generally not involved with operations that pose a high risk for environmental liabilities, properties acquired for redevelopment purposes could be contaminated or may contain hazardous substances, such as petroleum products, lead, and/or asbestos. The former RDA’s due diligence property acquisition policies required that the RDA obtain a Phase I Environmental Site Assessment (ESA) report on all properties to be acquired by the RDA to minimize or avoid potential environmental liabilities. If the Phase I ESA findings and conclusions indicate the need for further environmental investigation, a Phase II ESA is commissioned. In the event of an acquisition leading to demolition, the former RDA obtained a Phase I and/or Phase II report and, if necessary, remediated the property according to state and federal laws prior to demolition. In instances where hazardous substances or petroleum products were detected by the Phase II ESA, environmental remediation (cleanup) is subsequently planned and executed. The Phase II ESA and cleanup work are normally supervised and sanctioned by local environmental agencies such as the California Regional Water Quality Control Board (RWQCB). This agency accepts the completion of the cleanup work by issuing a “Case Closure” letter that officially declares the property free of hazardous substances or petroleum products.
During fiscal year 2016, the Successor Agency held one parcel subject to environmental investigation at 655 “G” Street - Chinatown. In February 2009, the City transferred title to four parcels in the Chinatown project area to the RDA. In October 1995, a Phase II ESA was completed for the four CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 157 NOTE 13 - COMMITMENTS AND CONTINGENCIES parcels. The parcel at 718 “F” Street and two parcels at 705 “G” Street were free of hazardous substances or petroleum products. The fourth parcel at 655 “G” Street was found to be in need of further assessment (Phase II ESA) because suspected leaking gasoline tanks had been removed from the site. The RWQCB advised the City that additional assessment was necessary to further evaluate impacted soils and groundwater and required a work plan outlining the assessment. Recently, the Successor Agency obtained an EPA grant to assess 655 “G” Street, as required by the RWQCB. The work plan and field work have been completed and test results have been received. Monitoring wells have been installed at the site and water samples are to be tested quarterly. RWQCB will review the results and advise if further action is needed. At this time, any potential costs cannot be estimated with any degree of certainty. Until such time as the costs can be estimated with more certainty, no liability will be accrued.
E. Measure Z, Zoo Accreditation, Fresno Chaffee Zoo Corporation In accordance with an agreement between the City and the Fresno Chaffee Zoo Corporation (FCZC), a California benefit corporation, a non-profit board operates the Chaffee Zoo (Zoo). The City and the FCZC also negotiated a lease and a financing arrangement.
The lease agreement, dated January 1, 2006, was negotiated for a 30-year period. There is also a 25- year renewal of the term if the Zoo Tax was reinstated after its initial 10-year term, or two additional 10-year renewal options if the tax was not renewed. On November 4, 2014, a new incarnation of Measure Z which extends the tax for another 10 years was passed triggering the 25-year lease renewal. The lease rate is at $1.00 per year.
The lease agreement sets forth the terms and conditions between the City and FCZC, with respect to the Zoo premises and any expansion that might occur in a designated expansion area. The City is responsible for all maintenance and operation costs in the expansion area, until such time as the FCZC takes possession of the expansion area by exercising its rights in accordance with lease provisions.
The City retained ownership of the land, buildings, structures, permanent fixtures, and improvements in existence at the commencement date of the lease, while the FCZC is the owner of all buildings, structures, and improvements constructed thereafter until the end of the lease term.
The Financing Agreement conveyed the Zoo animals and Zoo personal property to the FCZC, along with all obligations the City had with respect to the animals exhibited, housed or otherwise kept or cared for at the Zoo during the term of the lease. At the termination of the lease or the end of the lease term, should the City decide not to continue operations of the Zoo, the FCZC has the right to sell or dispose of the Zoo animals and keep the proceeds of any sale or disposition at its sole cost or expense. The FCZC also has the authority to acquire, sell or dispose of Zoo animals in the course of the lease so long as the compliment of animals at all times is similar in type and proportion to the Zoo animals on hand upon commencement of the lease.
The FCZC must maintain Association of Zoo & Aquariums (AZA) accreditation of the Chaffee Zoo.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 158 NOTE 13 - COMMITMENTS AND CONTINGENCIES F. Granite Park
In 2005, the City entered into a Contingent Debt Purchase Agreement guaranteeing a loan regarding a 20-acre sports-related complex under development and adjacent to office and commercial retail amenities, known as Granite Park.
On June 30, 2009, a formal demand was made on the City to purchase the Loan Package for a stipulated purchase price. On September 17, 2009, the City deposited $5,105,271 in a loan purchase escrow. The City utilized funds from its cash pool with the intention of ultimately issuing long-term bonds to finance the acquisition over 30 years.
The City proceeded to purchase the Granite Park property at a unified foreclosure sale and took title to and possession of Granite Park sports fields pursuant to a Trustee’s Deed recorded in Fresno County on March 16, 2010. The City paid $5,105,218 and holds the property for possible use, development and/or disposition.
The City entered into a 25-year ground lease and 10-year service contract with Central Valley Community Sports Foundation (CVCSF) on September 24, 2015. The ground lease calls for the CVCSF to make rent payments of $62,500/year, which are increased annually by 2.75%/year. The CVCSF is responsible for maintenance of Granite Park's sports-related complex, as well as the financing of various capital improvements. Under the service contract, the City pays the CVCSF $150,000/year to provide a variety of sports and recreational programming.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 159 NOTE 13 - COMMITMENTS AND CONTINGENCIES G. Construction and Other Significant Commitments
At June 30, 2022 , the City had commitments for the following major construction projects (in thousands):
Project Title
Remaining
Construction
Committed
Governmental:
Ericson Elementary Neighborhood Reconstruction $ 1,065
UGM Fire Station #18 1,153
Pedestrian Trls and Bicycle Lanes-Various Locations 1,381 Fire Regional Training Center Construction 1,449
Traffic Signals- Various Locations 13,819
Total Governmental 18,867
Proprietary:
TCP Plan & Remediation 224
Surface Water Treatment 472
SW Recycled Water Dist Syst 604
South East Fresno Surface Water Treatment Facility 982
Pump Rehabilitations 1,052
Veteran's Boulevard Sewer 1,210
DPU Substation Expansion 2,225
TIRCP- South West Community Connector 3,369
Terminal Renovations & Expansion 3,726
Water Well Construction & Rehabilitation 5,620
FAT Parking Garage 6,512
Regional Wastewater Reclamation Facility Renovations 7,181 Water Main Renewal & Extensions 8,019
PTMISEA 8,236
Collection System Rehabilitation & Extensions 10,995
Total Proprietary 60,427
Total Major Construction Projects $ 79,294
H. Discolored Water
In February 2016, the City undertook a broad investigation into reports of discolored water and the presence of lead in drinking water in certain homes located in Northeast Fresno. The City conducted the investigation with oversight from the State Water Resources Control Board - Division of Drinking Water (DDW), Fresno County Department of Public Health, and the U.S. Environmental Protection Agency (EPA). The investigation has included, for example, water quality sampling, soil sampling, pipe testing, field investigations and home inspections, consultations with national corrosion experts, multiple community meetings and presentations, and public distribution of information and education materials.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 160 NOTE 13 - COMMITMENTS AND CONTINGENCIES In early 2017, the EPA conducted a comprehensive review of the City and the State of California’s oversight of the City’s drinking water treatment and testing program. The EPA concluded that the City has historically complied with the regulatory action level for lead, and that the City’s water system has been optimized for corrosion control since 1996.
In September 2016 and May 2017, groups of residents filed two lawsuits against the City and other parties seeking damages for harm allegedly caused by the City’s water supply. Litigation is currently ongoing. The City will continue to vigorously defend itself in these matters.
The City continues to work with residents by regularly monitoring their water. For more information regarding the City’s continued efforts to resolve discolored water issues, please see https:// www.fresno.gov/publicutilities/water-quality-operations-testing/.
The City has spent $ 5,120,931 through June 30, 2022 to investigate and address the discolored water complaints. All of these costs have been and will continue to be recorded in the Water Fund.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 161 NOTE 13 - COMMITMENTS AND CONTINGENCIES Note 14. Securities Lending
The City does not engage in securities lending with any investment instruments that it holds. The City’s Retirement Systems are permitted under the City’s Municipal Code and Retirement Boards’ policies to enter into securities lending transactions. For a detailed description of the Retirement Systems’ security lending policies and the financial effect of such lending, please see the Retirement Systems’ ACFRS, which can be found at https://www.cfrs-ca.org/fire-and-police-retirement-system/ financial/ for the Fire and Police Retirement System and https://www.cfrs-ca.org/employee- retirement-system/ers-financial/ for the Employees Retirement System.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 162 NOTE 14 - SECURITIES LENDING Note 15. Other Information
Construction Retainage Escrow Accounts
The City enters into construction contracts with various outside third-party contractors with respect to major capital projects. As the construction progresses, progress payments are made to the contractors. Portions of the payments, called retention payments, are paid into an escrow account.
While these funds are earned by the contractors, generally 5% to 10% of the contract amount, they are not released out of the escrow account to the contractor until some agreed upon date, usually the completion of the job. These amounts are retained for a variety of reasons, as an incentive to complete the job in a timely manner, or as a fund for the benefit of suppliers and subcontractors. The City may not convert the funds in these escrow accounts for its use unless a breach of contract occurs.
COVID-Related Funding
The City has received a substantial amount of funding from the Federal and State government since the beginning of the COVID-19 pandemic to offset the pandemic’s health and economic impacts. The following are the major COVID-19 mitigation funding sources that have been awarded to/received by the City as of June 30, 2022.
Coronavirus Aid, Relief, and Economic Security (CARES) Act – The City received $92.8 million in CARES funding in April 2020 and has fully expended all CARES funding as of December 30, 2021. Funding has been used for services such as expanded COVID testing and contact tracing for residents, food assistance, homeless transitional housing, small business assistance, and residential housing retention grants.
Transit CARES - The City’s Transportation Department (Transit) was awarded $32.5 million to assist in Fixed Route Operation, Handy Ride Operating Support, and bus purchases. This funding was intended to offset funding losses caused due to COVID-related shutdowns of service or ridership restrictions.
As of June 30, 2022, Transit has received $31.8M of the awarded amount, which reimbursed expenses incurred in FY20 and FY21.
American Rescue Plan Act (ARPA) – In March 2021, the City was awarded $170.8 million of ARPA funding and has allocated all funding to various City led and Community Based Organization led projects. As of June 30, 2022, the City has expended $223,865.31 in ARPA funding and continues to implement identified projects throughout the City of Fresno.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 163 NOTE 15 - OTHER INFORMATION Emergency Rental Assistance Program (ERAP) – The City was awarded $69.3 million in ERAP funding:
$35.6 million from the Federal government and $33.7 million from the State. As of June 30, 2022, the City had received $54.5 million of its awarded total with the remaining amount expected by December 31, 2022. The program is designed to assist qualified residents in retaining housing and utilities by reimbursing landlords and utility providers for past due billings. As of June 30, 2022, the City had spent $41.7 million of its awarded amount, with $34.6 million paid directly to landlords and utility providers for delinquent rent and utilities.
Coronavirus Response and Relief Supplemental Appropriation Act (CRRSAA) - The City's Transit Department was awarded $5.6 million in CRRSAA funds in 2021. The funds are to be spent on operating expenses incurred during fiscal year 2022. The City's Airports Department was awarded $4.6 million in CRRSAA funds. A portion of the funding ($0.2 million) is reserved for concession relief.
The remaining funds can be spent on debt service payments, COVID-related expenses and operating expenses. As of June 30, 2022, Airports has expended their CRRSAA award in full. As of June 30, 2022 Transit has not received their CRRSAA award.
Prior Period Adjustments
Government-Wide Financial Statements – The beginning net position at July 1, 2021 of the Government-Wide Financial Statements was restated as follows:
Governmental
Activities
Business-Type
Activities
Net position, as previously reported, at July 1, 2021 $ 1,022,873 $ 1,581,864 Change in accounting estimate, corrections to capital
asset useful life and construction in progress 26
Cumulative effect of accounting change related to
revenue recognition - Convention Center 1,235
To implement GASB 87 (82)
Net position at July 1, 2021, as restated $ 1,022,791 $ 1,583,125 Proprietary Fund Financial Statements – The beginning fund balance at July 1, 2021 of the Proprietary Fund Financial Statements was restated as follows:
Sewer
System Transit Airports
Fresno
Convention
Center
Totals
Net position, as previously reported, at July 1, 2021 $ 716,351 $ 144,577 $ 189,885 $ (1,181) Change in accounting estimate, corrections to
capital asset useful life and construction in progress (10) 153 (17) (100) $ 26 Cumulative effect of accounting change related to
revenue recognition 1,235 1,235
Net position at July 1, 2021, as restated $ 716,341 $ 144,730 $ 189,868 $ (46) CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
164 NOTE 15 - OTHER INFORMATION
Fiduciary Fund Financial Statements – The beginning net position at July 1, 2021 of the Fiduciary Fund Financial Statements was restated as follows:
City
Departmental
Special
Assess Dists
Total
Custodial
Funds
Net position, as previously reported, at July 1, 2021 $ — $ — $ — To implement GASB 84. GASB 84 was not fully
implemented as required in fiscal year 2021 2,428 1,540 3,968 Net position at July 1, 2021, as restated $ 2,428 $ 1,540 $ 3,968 CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022
165 NOTE 15 - OTHER INFORMATION
Note 16. Deficit Fund Equity
The Risk Management Internal Service Fund and High Speed Rail Fund had deficit net position/fund balances as of June 30, 2022.
The deficit net position in the Risk Management Fund at June 30, 2022 was $192.9 million, an increase of $19.5 million. The increase was due to the City reflecting a Liability for Self-Insurance on its Combining Statement of Net Position in the amount of $200.5 million . This liability grew by $14.8 million between fiscal years 2021 and 2022. .
The deficit net position in the High Speed Rail Fund at June 30, 2022 was $2.7 million. The deficit net position of this fund at the end of fiscal year 2021 was $3.3 million. The decrease in the deficit net position of $0.6 million is due to a $10 million increase in capital outlay construction projects alongside a $13 million increase in federal reimbursements.
The City management continues to carefully monitor these funds and evaluate strategies for reducing and eliminating these deficit fund equity balances.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 166 NOTE 16 - DEFICIT FUND EQUITY Note 17. Subsequent Events
In compliance with accounting standards, management has evaluated events that have occurred after fiscal year-end to determine if these events are required to be disclosed in the basic financial statements. Events were considered through March 17, 2023 , which is the date the financial statements were available to be issued.
A. Bond Ratings
Moody's upgraded the City's Lease Revenue Bond from A3 to A2, its Pension Obligation Bond rating from Baa1 to A1, and its General Obligation rating from A2 to A1 on December 19, 2022. All three ratings maintained a Stable outlook. Moody's cited the City's strengthened financial performance, conservative debt profile, and growing economy among the reasons why they upgraded the City's credit ratings.
Standard and Poor's upgraded the City's General Obligation rating from A+ to AA-, its Pension Obligation Bond rating from A+ to AA-, and its Lease Revenue Bond from A to A+ on November 14, 2022. All three ratings maintained a Stable outlook. As justification for the rating action, the agency cited the recovery in passenger traffic along with the corresponding improvement in revenues and liquidity.
The most current City ratings are as follows:
Rating
Agency
Effective
Date Rating Outlook
Lease Revenue Bonds
Fitch 6/2016 A- Stable
Standard & Poor’s 11/2022 A+ Stable
Moody’s 12/2022 A2 Stable
General Obligation (GO)
Fitch 6/2016 A Stable
Standard & Poor’s 11/2022 AA- Stable
Moody’s 12/2022 A1 Stable
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 167 NOTE 17 - SUBSEQUENT EVENTS A. Terminal/Federal Inspection Service (FIS) Expansion Project The Fresno Yosemite International Airport expects to receive $70 million from the issuance of proposed Series 2023 Bonds for the capital costs of the Terminal/FIS Expansion Project, net of fund deposits and
Issuance Costs. The total estimated cost of the project is anticipated to be $145.1 million and will provide the design and construction of:
• An expanded security checkpoint to provide a minimum of 5 lanes and related offices for Transportation Security Administration (TSA).
• A new concourse to the east of the expanded security checkpoint, with two additional gates on the second floor equipped with loading bridges.
• A new FIS facility with a target throughput of 400 arrivals per hour compared to the current capacity of 150 arrivals per hour, with a baggage claim unit located on the first floor of the new concourse and the processing facility to the east.
• An in-line baggage screening facility between the expanded security checkpoint and the new concourse.
• Additional airline ticket offices in the existing ticket lobby, converted from prior baggage makeup and screening space.
• Other supporting concession space.
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CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - General Fund
Fiscal Year Ended June 30, 2022
(in thousands)
Budgeted Amounts Actual
Amounts
Budgetary
Basis
Over
(Under)
Final BudgetOriginal Final
Budgetary Fund Balance, July 1 $ 71,154 $ 90,081 $ 90,983 $ 902 Resources (inflows):
Taxes:
Property Taxes 160,000 160,000 154,703 (5,297)
Sales Taxes 116,096 128,436 148,766 20,330
Other Taxes 39,031 39,031 42,127 3,096
Franchise Taxes 14,483 14,483 15,732 1,249
Licenses and Permits 14,215 14,243 9,047 (5,196)
Intergovernmental:
State Motor Vehicle In-Lieu 348 348 632 284
Other State Revenue 1,491 1,504 2,346 842
Other Intergovernmental 3,653 3,779 2,966 (813)
Charges for Services:
Charges for Services 34,238 34,238 33,721 (517)
Fines and Violations 2,641 2,641 2,586 (55)
Use of Money and Property 1,199 1,199 1,615 416
Miscellaneous 26,554 26,646 23,808 (2,838)
Other Financing Sources:
Transfers from Other Funds 7,480 114,217 31,296 (82,921) Total Available for Appropriations 492,583 630,846 560,328 (70,518) Charges to Appropriations (outflows):
General Government:
Mayor and City Council 11,237 12,484 8,742 (3,742)
Other General Government 37,664 52,158 32,070 (20,088) Public Protection:
Police Department 198,425 212,095 209,055 (3,040)
Fire Department 71,969 80,272 79,407 (865)
Public Ways & Facilities 26,308 64,463 19,173 (45,290) Culture and Recreation 23,107 23,928 16,977 (6,951) Community Development 43,159 62,034 36,187 (25,847) Capital Outlay 5,335 44,100 21,324 (22,776)
Other Financing Uses:
Transfers to Other Funds 32,396 35,863 37,823 1,960 Total Charges to Appropriations 449,600 587,397 460,758 (126,639) Less Estimated Attrition Savings — — — —
Excess Resources Over Appropriations $ 42,983 $ 43,449 $ 99,570 $ 56,121 See accompanying notes to the required supplementary information. 171
CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - General Fund
Fiscal Year Ended June 30, 2022 (Continued)
(in thousands)
Explanation of differences between budgetary inflows and outflows and GAAP Revenues and Expenditures:
Sources/Inflows of Resources:
Actual amounts (budgetary basis) available for appropriation from the Budget to Actual Comparison Schedule. $ 560,328
Differences - Budget to GAAP:
The City budgets for taxes, intergovernmental and miscellaneous revenue on the cash basis of accounting, rather than on the modified accrual basis of accounting. (6,863) Interfund reimbursements are not revenues and are expenditures for financial reporting. (20,591) Carryovers are inflows of budgetary resources but are not revenues for financial reporting purposes. (90,983)
Transfers from other funds are inflows of budgetary resources but are not revenues for financial reporting purposes. (31,296)
Nonreciprocal interfund activity is not revenue and is a transfer for financial reporting. (3,038) Total revenues as reported on the Statement of Revenues, Expenditures, and Changes in Fund Balances-Governmental Funds. $ 407,557
Uses/Outflows of Resources:
Actual amounts (budgetary basis) "total charges to appropriations" from the Budget to Actual Comparison Schedule. $ 460,758 Differences - Budget to GAAP:
The City budgets for expenditures on the cash basis of accounting, rather than on the modified accrual basis of accounting. (19,459)
Interfund reimbursements are a reduction of expenditures for financial reporting. (20,591) Pension Obligation bond debt payments and City Hall rent are recognized as transfers out to other funds. (13,575)
Transfers to other funds are outflows of budgetary resources, but are not expenditures for financial reporting purposes. (37,823) Return on capital asset as offset for Advances to Other Funds Capital financing activity additions are expenditures for financial reporting purposes. 5,065 Total charges to appropriations as reported on the Statement of Revenues, Expenditures, and Changes in Fund Balances-Governmental Funds. $ 374,375 See accompanying notes to the required supplementary information. 172
CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - Grants Special Revenue Fund Fiscal Year Ended June 30, 2022
(in thousands)
Budgeted Amounts Actual
Amounts
Budgetary
Basis
Over
(Under)
Final BudgetOriginal Final
Budgetary Fund Balance, July 1 $ (25,018) $ 55,308 $ 76,059 $ 20,751 Resources (inflows):
Intergovernmental:
Federal Grants 100,846 151,309 38,651 (112,658)
State Grants 38,753 60,780 46,548 (14,232)
Local Support 10 1,854 1,843 (11)
Charges for Services 1,405 1,405 1,379 (26)
Use of Money and Property (41) (41) 2,291 2,332
Miscellaneous — 25 4,688 4,663
Other Financing Sources:
Transfers from Other Funds 193 390 2,387 1,997
Total Available for Appropriations 116,148 271,030 173,846 (97,184) Charges to Appropriations (outflows):
General Government 30,273 63,170 36,028 (27,142)
Public Protection 4,889 5,955 4,943 (1,012)
Public Ways & Facilities 46,083 47,703 20,288 (27,415) Culture and Recreation 3,776 4,998 2,061 (2,937)
Community Development 54,908 63,142 16,985 (46,157) Capital Outlay 61,207 64,238 17,883 (46,355)
Other Financing Uses:
Transfers to Other Funds — 106,644 19,329 (87,315)
Total Charges to Appropriations 201,136 355,850 117,517 (238,333) Excess (Deficit) Resources Over Appropriations $ (84,988) $ (84,820) $ 56,329 $ 141,149 See accompanying notes to the required supplementary information. 173
CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - Grants Special Revenue Fund Fiscal Year Ended June 30, 2022 (Continued)
(in thousands)
Explanation of differences between budgetary inflows and outflows and GAAP Revenues and Expenditures:
Sources/Inflows of Resources:
Actual amounts (budgetary basis) available for appropriation from the Budget to Actual Comparison Schedule. $ 173,846
Differences - Budget to GAAP:
Grant reimbursements are budgeted on the cash basis of accounting rather than on the modified accrual basis of accounting. 12,066
Transfers from other funds are inflows of budgetary resources but are not revenues for financial reporting purposes. (2,387)
Interfund reimbursements are not revenues and are expenditures for financial reporting. (1,378) Carryovers are inflows of budgetary resources but are not revenues for financial reporting purposes. (76,059)
Payments from the Successor Agency to the Fresno Redevelopment Agency on advances with full allowance are revenues. (33)
The receipt of loan payments are inflows of budgetary resources but are not revenues for financial reporting purposes. (1,029) Total revenues as reported on the Statement of Revenues, Expenditures, and Changes in Fund Balances-Governmental Funds. $ 105,026
Uses/Outflows of Resources:
Actual amounts (budgetary basis) "total charges to appropriations" from the Budget to Actual Comparison Schedule. $ 117,517 Differences - budget to GAAP:
The City budgets for expenditures on the cash basis of accounting rather than on the modified accrual basis of accounting. 24,367 Interfund reimbursements are a reduction of expenditures for financial reporting. (1,378) Pension Obligation bond debt, HUD debt, and City Hall rent are recognized as transfers out to other funds. (102)
Changes in allowance for doubtful accounts on notes receivable, notes that should become grants, and adjustments are expenditures for financial reporting purposes. 143 Transfers to other funds are outflows of budgetary resources but are not expenditures for financial reporting purposes. (19,329) Total charges to appropriations as reported on the Statement of Revenues, Expenditures, and Changes in Fund Balances-Governmental Funds. $ 121,218 See accompanying notes to the required supplementary information. 174
Notes to the Required Supplementary Information
A. Budgetary Data
The City of Fresno (the City) operates under the Strong-Mayor form of government. Under the Strong-Mayor form of government, the Mayor serves as the City’s Chief Executive Officer, appointing and overseeing the City Manager, recommending legislation, and presenting the annual budget to the City Council.
The City adopts annual budgets for all governmental and business-type funds (except Fresno Revitalization Corporation, Financing Authorities and Corporations, and City Debt Service) on the cash basis of accounting plus encumbrances. The budget includes: (1) the programs, projects, services, and activities to be provided during the fiscal year, (2) the estimated resources (inflows) and amounts available for appropriation, and (3) the estimated charges to appropriations. The budget represents a process through which policy decisions are made, implemented, and controlled. The City Charter (the Charter) prohibits expending funds for which there is no legal appropriation.
The budget of the City of Fresno, within the meaning and context of Section No. 1205 of the Charter, must be adopted by resolution of the City Council by June 30 of a given year. The following procedures are used in establishing the budgetary data reflected in the budgetary comparison schedules.
As provided by Section No. 1206 of the Charter, any adjustments in the amounts appropriated for the purposes indicated at the department/fund level are made only upon a motion to amend the resolution adopted by the affirmative votes of at least five City Council members.
B. Budget Development
The preparation of the budget document is the result of a Citywide effort. Each department is presented with an operating base budget that is used as the foundation for building their requests for the operations of their organizations. All one-time expenditure increases are removed, except for those demonstrable and mandatory. A five-year capital budget is required from all departments.
The purpose is to give the Mayor and City Council a tool to plan for the future as well as to more realistically reflect the timing of many capital projects that take more than one year to complete.
Departments submit their requests to be analyzed and reviewed by the City’s Budget and Management Studies Division (BMSD). Requests are evaluated based on individual operations, City funding resources, and the goals and strategies identified by each organization related to the impact on performance measures. Recommendations are presented to the Mayor and City Manager in a series of review meetings comprised of the Mayor, Mayor’s Chief of Staff, City Manager, Assistant City Managers, Budget Manager, Department Directors and representatives from each department, and BMSD. Upon final decisions of format and content, the Mayor’s Recommended Budget Document is printed and presented to the City Council for deliberation and adoption.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 175 NOTES TO THE
REQUIRED SUPPLEMENTARY INFORMATION
C. Original Budget
Prior to June 1, the Mayor submits to the City Council a recommended detailed operating budget for the fiscal year commencing July 1. The operating budget includes proposed expenditures and the means of financing them.
Public hearings are conducted to obtain taxpayer comment on the proposed annual budget. The Mayor and his staff analyze, review, and refine the budget submittals.
Prior to July 1, the budget is legally enacted through adoption of a resolution by the City Council.
D. Final Budget
Certain annual appropriations are budgeted on a project or program basis. If such projects or programs are not completed at the end of the fiscal year, unexpended appropriations are carried forward to the following year though either an encumbrance or an amendment to the budget. In certain circumstances, other programs and regular annual appropriations may be carried forward after appropriate approval. Annually appropriated funds not authorized to be carried forward lapse at the end of the fiscal year. Appropriations carried forward from the prior year are included in the final budgetary data.
The City Manager is authorized to transfer funds already appropriated within a department's budget within a fund. However, any revisions that alter the total appropriations of a department within a fund must be approved by the City Council. Expenditures may not legally exceed budgeted appropriations at the department level within a fund.
The City adopts an annual budget for all governmental and business-type funds. The Adopted Budget Document is prepared to include all the various changes approved by the City Council. No budgets are legally adopted for Fresno Revitalization Corporation, Financing Authorities and Corporations, and City Debt Service. Budgeted amounts are reported as amended. During the year, several supplementary appropriations were necessary, but were not material in relation to the original appropriations.
E. Budgetary Results Reconciliation
1. Basis Differences
The City’s budgetary process is based upon an accounting basis other than generally accepted accounting principles (GAAP). The results of operations (actual) are presented in the budget and actual comparison schedule in accordance with the budgetary process (Budget basis) to provide a meaningful comparison with the budget, while the financial statements are presented using the GAAP basis. Loan proceeds, loan repayments, transfers, and interfund reimbursements primarily cause the basis differences.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 176 NOTES TO THE
REQUIRED SUPPLEMENTARY INFORMATION
2. Timing Differences
One of the major differences between the Budget basis and GAAP basis are timing differences.
Timing differences represent transactions that are accounted for in different periods for the Budget basis as opposed to the GAAP basis of reporting. Revenues such as grant revenues recognized on a cash basis are unavailable for GAAP reporting, while various expenditures not recognized on a cash basis have been accrued for GAAP reporting.
Administrative amendments within the same department/fund level may be made without approval of the City Council within written guidelines established by the Chief Administrative Officer/City Manager.
For accounting and auditing convenience, appropriations for capital improvements may be established in two or more different funds for the same capital project.
The objective of budgetary controls is to ensure compliance with legal provisions embodied in the annual appropriated budget approved by the City Council. Activities of the General Fund and Special Revenue Funds are included in the annual appropriated budget. Project-length financial plans are adopted for certain capital projects. The level of budgetary controls (the level at which expenditures cannot legally exceed the appropriated amount) is maintained at the department level by major expenditure category. Purchase orders that result in an overrun (encumbrance exceeding available appropriations) of department-level balances by object are not released until additional appropriations are made available. Open encumbrances at June 30 are reported as restricted, committed, or assigned fund balance in the governmental funds Balance Sheet.
The City assumed an attrition savings amount of $6.9 million in its fiscal year 2022 budget. The amount was in recognition of the fact that not all positions budgeted in the General Fund are filled during the entire fiscal year. The attrition savings was established as a negative appropriation in each General Fund department's Personnel Services budget. However, no actual savings accrued against the attrition savings account. For purposes of the Budget-to-Actual report in the Required Supplementary Information, the difference between the negative appropriation and the actual lack of activity results in the account appearing to be over-budget.
Actual Transfers from Other Funds were $ (82.9) million lower than budgeted levels in fiscal year 2022. The overage was mostly due to transfers from the CARES Grant fund for eligible expenditures.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 177 NOTES TO THE
REQUIRED SUPPLEMENTARY INFORMATION
Schedule of Investment Returns
PENSION TRUST FUNDS
EMPLOYEES, FIRE AND POLICE RETIREMENT SYSTEMS
Last Ten Fiscal Years
Fiscal Year
Ending June 30
Annual Money-Weighted Rate of Return
Gross of Investment Expenses
Annual Money-Weighted Rate of Return
Net of Investment Expense
2022 (7.12)% (7.28)%
2021 30.85% 30.43%
2020 1.61% 1.26%
2019 5.54% 5.20%
2018 8.93% 8.57%
2017 17.73% 14.35%
2016 0.82% 0.53%
2015 3.32% 2.93%
2014 17.61% 17.16%
2013 13.65% 13.20%
The Schedule of Investment Returns above shows the annual money-weighted rate of return on the assets of the Systems, both gross and net of investment expense for ten fiscal years ( 2012-2021). The money-weighted rate of return expresses investment performance adjusted for timing of cash flows and the changing amounts actually invested. These returns differ slightly from the time-weighted rate of returns calculated and reported by the Systems' custodian, Northern Trust, and as independently reported by the Systems' investment consulting firm, NEPC, LLC. The Systems' custodian and investment consulting firm must use time-weighted returns as opposed to money-weighted returns in order to meet Global Investment Performance Standards for the purposes of effectively evaluating and reporting the performance of the Systems' investment managers.
The time-weighted return method is a measure of the compound rate of return of a portfolio over a stated period of time. It requires a set of sub- period returns to be calculated whenever there is an external cash flow, such as a deposit or withdrawal from the portfolio. In essence, it calculates the geometric total and mean return as opposed to the arithmetic total and mean return. This method does not include or have any distortions created when money is deposited or withdrawn from a portfolio. This is in contrast to money-weighted returns.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 178
Schedule of Changes in the Net Pension Liability (Asset) and Related Ratios
PENSION TRUST FUNDS
FIRE AND POLICE RETIREMENT SYSTEMS
Schedule of Changes in the Net Pension Liability (Asset) and Related Ratios(2) Change in Net Pension Liability (in thousands)
For the Fiscal Year Ended: 6/30/2022 6/30/2021 6/30/2020 6/30/2019 Reporting Date: 6/30/2022 6/30/2021 6/30/2020 6/30/2019 Measurement Date: 6/30/2021 6/30/2020 6/30/2019 6/30/2018 Total Pension Liability
Service Cost $ 37,563 $ 37,619 $ 33,211 $ 30,298
Interest 109,740 105,570 100,609 95,274
Differences between expected &
actual experience (5,449) 260 (7,067) 6,722
Changes of assumptions — (14,745) 55,856 2,891
Benefit payments, including refunds (70,963) (67,202) (65,962) (63,071) Net Change in Total Pension
Liability 70,891 61,502 116,647 72,114
Total Pension Liability - Beginning 1,565,631 1,504,129 1,387,482 1,315,368 Total Pension Liability - Ending (a)* $ 1,636,522 $ 1,565,631 $ 1,504,129 $ 1,387,482 Plan Fiduciary Net Position
Contributions - employer $ 26,315 $ 22,324 $ 20,604 $ 19,697 Contributions - employee 10,256 10,012 9,597 8,964
Net Investment Income 491,744 24,206 82,872 129,163 Benefit Payments including Refunds,
PRSB (70,963) (67,202) (65,962) (63,071)
Administrative & Professional
Expense (2,282) (1,839) (1,897) (1,710)
Net Change in Plan Fiduciary Net
Position 455,070 (12,499) 45,214 93,043
Plan Fiduciary Net Position - Beginning 1,635,301 1,647,800 1,602,586 1,509,543 Plan Fiduciary Net Position - Ending (b) $ 2,090,371 $ 1,635,301 $ 1,647,800 $ 1,602,586 Plan Net Pension Liability (Asset) -
Ending (a) - (b) $ (453,849) $ (69,670) $ (143,671) $ (215,104) Plan Fiduciary Net Position as a
percentage of Total Pension Liability 127.73 % 104.45 % 109.55 % 115.50 % Covered Payroll (1) $ 115,341 $ 113,843 $ 109,803 $ 103,934 Plan Net Pension Liability as a
percentage of covered payroll (393.48) % (61.20) % (130.84) % (206.96) % * Data above is provided in accordance with provisions of GASB Statement No. 68 for determining Total Pension Liability which for financial reporting purposes uses a version of the Entry Age method whereby the Actuarial Accrued Liability is fully accrued when a member either enters DROP or is expected to elect DROP. (1) Covered payroll represents payroll in which contributions to the Systems are based. (2) Ten year data will be presented in future years as information becomes available.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 179
PENSION TRUST FUNDS
FIRE AND POLICE RETIREMENT SYSTEMS
Schedule of Changes in the Net Pension Liability (Asset) and Related Ratios (cont) Change in Net Pension Liability (in thousands)
6/30/2018 6/30/2017 6/30/2016 6/30/2015 For the Fiscal Year Ended:
6/30/2018 6/30/2017 6/30/2016 6/30/2015 Reporting Date:
6/30/2017 6/30/2016 6/30/2015 6/30/2014 Measurement Date:
Total Pension Liability
$ 28,838 $ 26,569 $ 26,518 $ 28,058 Service Cost
90,185 88,363 86,771 86,092 Interest
10,896 (42,952) (36,528) (49,879)
Differences between expected &
actual experience
— 49,427 — — Changes of assumptions
(59,273) (56,581) (54,612) (52,720) Benefit payments, including refunds 70,646 64,826 22,149 11,551
Net Change in Total Pension
Liability
1,244,722 1,179,896 1,157,747 1,146,196 Total Pension Liability - Beginning $ 1,315,368 $ 1,244,722 $ 1,179,896 $ 1,157,747 Total Pension Liability - Ending (a)* Plan Fiduciary Net Position
$ 18,543 $ 18,738 $ 18,967 $ 18,575 Contributions - employer 8,169 7,748 7,385 7,294 Contributions - employee
192,315 6,063 39,164 201,838 Net Investment Income
(59,273) (56,581) (54,612) (52,720)
Benefit Payments including Refunds,
PRSB
(1,500) (1,397) (1,108) (1,119)
Administrative & Professional
Expense
158,254 (25,429) 9,796 173,868
Net Change in Plan Fiduciary Net
Position
1,351,289 1,376,718 1,366,922 1,193,054 Plan Fiduciary Net Position - Beginning $ 1,509,543 $ 1,351,289 $ 1,376,718 $ 1,366,922 Plan Fiduciary Net Position - Ending (b) $ (194,175) $ (106,567) $ (196,822) $ (209,175)
Plan Net Pension Liability (Asset) -
Ending (a) - (b)
114.76 % 108.56 % 116.68 % 118.07 %
Plan Fiduciary Net Position as a
percentage of Total Pension Liability
$ 97,369 $ 94,266 $ 91,075 $ 91,721 Covered Payroll (1) (199.42) % (113.05) % (216.11) % (228.06) %
Plan Net Pension Liability as a
percentage of covered payroll
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 180
PENSION TRUST FUNDS
EMPLOYEES RETIREMENT SYSTEMS
Schedule of Changes in the Net Pension Liability (Asset) and Related Ratios(2) Change in Net Pension Liability (in thousands)
For the Fiscal Year Ended: 6/30/2022 6/30/2021 6/30/2020 6/30/2019 Reporting Date: 6/30/2022 6/30/2021 6/30/2020 6/30/2019 Measurement Date: 6/30/2021 6/30/2020 6/30/2019 6/30/2018 Total Pension Liability
Service Cost $ 30,993 $ 28,762 $ 23,509 $ 21,275
Interest 93,358 89,222 86,110 82,833
Differences between expected &
actual experience (12,980) 5,748 (446) (4,164)
Changes of assumptions — — 35,773 2,939
Benefit payments, including refunds (69,246) (64,519) (62,144) (57,666) Net Change in Total Pension
Liability 42,125 59,213 82,802 45,217
Total Pension Liability - Beginning 1,337,309 1,278,096 1,195,294 1,150,077 Total Pension Liability - Ending (a)* $ 1,379,434 $ 1,337,309 $ 1,278,096 $ 1,195,294 Plan Fiduciary Net Position
Contributions - employer $ 20,144 $ 16,554 $ 14,627 $ 14,609 Contributions - employee 13,750 11,028 10,515 10,330 Net Investment Income 407,811 20,109 69,389 108,915 Benefit Payments including Refunds,
PRSB (69,246) (64,519) (62,144) (57,666)
Administrative & Professional
Expense (2,058) (1,749) (1,663) (1,619)
Net Change in Plan Fiduciary Net
Position 370,401 (18,577) 30,724 74,569
Plan Fiduciary Net Position - Beginning 1,360,838 1,379,415 1,348,691 1,274,122 Plan Fiduciary Net Position - Ending (b) $ 1,731,239 $ 1,360,838 $ 1,379,415 $ 1,348,691 Plan Net Pension Liability (Asset) -
Ending (a) - (b) $ (351,805) $ (23,529) $ (101,319) $ (153,397) Plan Fiduciary Net Position as a
percentage of Total Pension Liability 125.50 % 101.76 % 107.93 % 112.83 % Covered Payroll (1) $ 154,031 $ 149,403 $ 138,396 $ 128,461 Plan Net Pension Liability as a
percentage of covered payroll (228.40) % (15.75) % (73.21) % (119.41) % * Data above is provided in accordance with provisions of GASB Statement No. 68 for determining Total Pension Liability which for financial reporting purposes uses a version of the Entry Age method whereby the Actuarial Accrued Liability is fully accrued when a member either enters DROP or is expected to elect DROP. (1) Covered payroll represents payroll in which contributions to the Systems are based. (2) Ten year data will be presented in future years as information becomes available.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 181
PENSION TRUST FUNDS
EMPLOYEES RETIREMENT SYSTEMS
Schedule of Changes in the Net Pension Liability (Asset) and Related Ratios (cont) Change in Net Pension Liability (in thousands)
6/30/2018 6/30/2017 6/30/2016 6/30/2015 For the Fiscal Year Ended:
6/30/2018 6/30/2017 6/30/2016 6/30/2015 Reporting Date:
6/30/2017 6/30/2016 6/30/2015 6/30/2014 Measurement Date:
Total Pension Liability
$ 18,885 $ 18,687 $ 18,476 $ 19,342 Service Cost
79,266 79,763 78,212 77,010 Interest
5,263 (24,394) (24,691) (29,889)
Differences between expected &
actual experience
— 9,612 — — Changes of assumptions
(55,550) (52,529) (50,546) (48,581) Benefit payments, including refunds 47,864 31,139 21,451 17,882
Net Change in Total Pension
Liability
1,102,213 1,071,074 1,049,623 1,031,741 Total Pension Liability - Beginning $ 1,150,077 $ 1,102,213 $ 1,071,074 $ 1,049,623 Total Pension Liability - Ending (a)* Plan Fiduciary Net Position
$ 15,205 $ 13,060 $ 12,327 $ 11,440 Contributions - employer 10,181 9,098 8,750 7,945 Contributions - employee
162,374 5,089 33,310 172,773 Net Investment Income
(55,550) (52,529) (50,546) (48,581)
Benefit Payments including Refunds,
PRSB
(1,387) (1,346) (1,071) (1,086)
Administrative & Professional
Expense
130,823 (26,628) 2,770 142,491
Net Change in Plan Fiduciary Net
Position
1,143,299 1,169,927 1,167,157 1,024,666 Plan Fiduciary Net Position - Beginning $ 1,274,122 $ 1,143,299 $ 1,169,927 $ 1,167,157 Plan Fiduciary Net Position - Ending (b) $ (124,045) $ (41,086) $ (98,853) $ (117,534)
Plan Net Pension Liability (Asset) -
Ending (a) - (b)
110.79 % 103.73 % 109.23 % 111.20 %
Plan Fiduciary Net Position as a
percentage of Total Pension Liability
$ 119,007 $ 108,541 $ 105,820 $ 103,597 Covered Payroll (1) (104.23) % (37.85) % (93.42) % (113.45) %
Plan Net Pension Liability as a
percentage of covered payroll
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 182
Schedule of Employer Contribution - Pension Trust Funds
FIRE AND POLICE RETIREMENT SYSTEM
Schedule of Employer Contributions
Last Ten Fiscal Years
(in thousands)
Fiscal Year
Ending
June 30
Actuarially
Determined
Contribution
(ADC)1
Contributions
in Relation to
the ADC
Contribution
Deficiency
(Excess)
Covered
Payroll
Contributions as a
Percentage of
Covered Payroll
2021 $ 26,315 $ 26,315 $ — $ 115,341 22.81%
2020 22,324 22,324 — 113,843 19.61%
2019 20,604 20,604 — 109,803 18.76%
2018 19,697 19,697 — 103,934 18.95%
2017 18,543 18,543 — 97,369 19.04%
2016 18,738 18,738 — 94,266 19.88%
2015 18,967 18,967 — 91,075 20.83%
2014 18,575 18,575 — 91,721 20.25%
2013 18,725 18,725 — 94,368 19.84%
2012 22,875 22,875 — 96,195 23.78%
EMPLOYEES RETIREMENT SYSTEM
Schedule of Employer Contributions
Last Ten Fiscal Years
(in thousands)
Fiscal Year
Ending
June 30
Actuarially
Determined
Contribution
(ADC)1
Contributions
in Relation to
the ADC
Contribution
Deficiency
(Excess)
Covered
Payroll
Contributions as
a Percentage of
Covered Payroll
2021 $ 20,144 $ 20,144 $ — $ 154,031 13.08%
2020 16,554 16,554 — 149,403 11.08%
2019 14,627 14,627 — 138,396 10.57%
2018 14,609 14,609 — 128,461 11.37%
2017 15,205 15,205 — 119,007 12.78%
2016 13,060 13,060 — 108,541 12.03%
2015 12,327 12,327 — 105,820 11.65%
2014 11,440 11,440 — 103,597 11.04%
2013 13,330 13,330 — 105,509 12.63%
2012 11,374 11,374 — 110,492 10.29%
1 Actuarially determined contribution rates are calculated as of June 30, two years prior to the end of the fiscal year in which contributions are reported. As such, the actuarial valuation dated June 30, 2020, will impact the contribution rate for the fiscal year ended June 30, 2022.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 183
SCHEDULE OF CHANGES IN THE NET OPEB LIABILITY AND RELATED RATIOS For Fiscal Year Ending June 30
(in thousands)
2018 2019 2020 2021 2022
Net OPEB Liability Beginning of Year $ 84,639 $ 92,820 $ 113,700 $ 148,672 $ 152,605 Changes for the Year:
Service Cost $ 4,769 $ 5,777 $ 10,885 $ 10,052 $ 6,603
Interest 2,995 3,688 3,012 3,045 3,221
Difference between Actual and
Expected Experience 417 — (7,800) — (19,028)
Assumption Changes 13,406 30,936 (6,622) (40,728)
Benefit Payments — (1,991) (2,061) (2,543) (2,912) Net Changes 8,181 20,880 34,972 3,932 (52,844)
Net OPEB Liability End of Year $ 92,820 $ 113,700 $ 148,672 $ 152,604 $ 99,761 Covered-Employee Payroll as of
December 311 $ 229,256 $ 236,134 $ 250,860 $ 257,132 $ 294,493 Net OPEB Liability as a percentage of
covered-employee payroll 40.49% 48.15% 59.26% 59.35% 33.88% Notes to Schedule
Historical information is required only for measurement periods for which GASB Statement No. 75 is applicable.
Future years information will be displayed up to 10 years as information becomes available.
The City does not accumulate assets in a dedicated trust, or equivalent arrangement, for the purpose of funding its retiree healthcare obligation. Therefore, the actuarial value of plan assets is zero. 1Covered-employee payroll used in the most recent valuation was calculated based on mid-year, as it was considered representative of the payroll during the fiscal year.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 184
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CITY OF FRESNO, CALIFORNIA
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2022
(in thousands)
Special Revenue
High
Speed
Rail
Fresno
Revitalization
Corporation
Special
Gas Tax Measure C Measure P
Community
Services
UGM
Impact Fees
Assets
Cash and Investments $ — $ 676 $ 15,280 $ 19,836 $ 23,633 $ 12,039 $ 54,912 Receivables, Net — — 74 80 78 722 776
Grants Receivable 953 — — — — 89 —
Intergovernmental Receivables — — 1,992 7,859 7,511 8 — Due From Other Funds — 103 587 109 529 243 1,200 Advances to Other Funds — — — — — — —
Property Held for Resale — — — — — — —
Restricted Cash — — — — — 108 —
Loans, Notes, Leases, Other
Receivables, Net — — — — — — —
Total Assets $ 953 $ 779 $ 17,933 $ 27,884 $ 31,751 $ 13,209 $ 56,888 Liabilities
Accrued Liabilities $ 368 $ 90 $ 1,432 $ 891 $ 536 $ 1,309 $ 265 Unearned Revenue — — — — — 15 —
Due to Other Funds 2,310 — 164 124 12 — —
Advances From Other Funds — 62 — — — — 2,490
Deposits From Others — — — — — 31 —
Total Liabilities 2,678 152 1,596 1,015 548 1,355 2,755 Deferred Inflows of Resources
Unavailable Revenue-Other 953 — — 1,321 — 653 —
Total Deferred Inflows of Resources 953 — — 1,321 — 653 — Fund Balances
Restricted — 627 16,337 25,548 31,203 4,046 54,133 Assigned — — — — — 7,155 —
Unassigned (Deficit) (2,678) — — — — — —
Total Fund Balances (2,678) 627 16,337 25,548 31,203 11,201 54,133 Total Liabilities, Deferred Inflows of
Resources and Fund Balances $ 953 $ 779 $ 17,933 $ 27,884 $ 31,751 $ 13,209 $ 56,888 187
Debt Service
Capital
Projects
Low and
Moderate
Income
Housing
Special
Assessments City Debt
Financing
Authorities
and
Corporations
City
Combined
Total
Nonmajor
Governmental
Funds
Assets
$ 10,004 $ 14,030 $ 4 $ 3,820 $ 30,284 $ 184,518 Cash and Investments — 64 4 14 80 1,892 Receivables, Net
— — — — 273 1,315 Grants Receivable
— 141 — — — 17,511 Intergovernmental Receivables
— 11 — — — 2,782 Due From Other Funds
62 — — — — 62 Advances to Other Funds
3,600 — — — — 3,600 Property Held for Resale
— — 2 1,176 — 1,286 Restricted Cash
20,084 — — — — 20,084
Loans, Notes, Leases, Other
Receivables, Net
$ 33,750 $ 14,246 $ 10 $ 5,010 $ 30,637 $ 233,050 Total Assets Liabilities
$ — $ 242 $ — $ — $ 170 $ 5,303 Accrued Liabilities
— — — — — 15 Unearned Revenue
— 45 — — — 2,655 Due to Other Funds
— — — — — 2,552 Advances From Other Funds
— — — — — 31 Deposits From Others
— 287 — — 170 10,556 Total Liabilities
Deferred Inflows of Resources
— — — — — 2,927 Unavailable Revenue-Other
— — — — — 2,927 Total Deferred Inflows of Resources Fund Balances
33,750 13,959 10 5,010 — 184,623 Restricted
— — — — 30,467 37,622 Assigned
— — — — — (2,678) Unassigned (Deficit)
33,750 13,959 10 5,010 30,467 219,567 Total Fund Balances $ 33,750 $ 14,246 $ 10 $ 5,010 $ 30,637 $ 233,050
Total Liabilities, Deferred Inflows of
Resources and Fund Balances
188
CITY OF FRESNO, CALIFORNIA
Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental FundsFiscal Year Ended June 30,
2022
(in thousands)
Special Revenue
High Speed
Rail
Fresno
Revitalization
Corporation
Special
Gas Tax Measure C Measure P
Community
Services
UGM
Impact
Fees
Revenues
Taxes $ — $ — $ 22,226 $ 23,771 $ 43,125 $ 2,288 $ —
Intergovernmental 6,291 — — — — 2,819 4
Charges for Services 436 210 — — — 6,206 21,240
Use of Money and Property — 103 (725) 230 125 (143) (2,647) Miscellaneous (3) 281 282 1,076 14 21 14
Total Revenues 6,724 594 21,783 25,077 43,264 11,191 18,611 Expenditures
Current:
General Government — — — — 886 1,236 —
Public Protection — — — — — 2,621 170
Public Ways and Facilities 1,055 — 15,860 13,099 24 2,698 4,438 Culture and Recreation — — — — 6,114 1,142 382
Community Development 23 214 — — — 2,989 —
Capital Outlay 4,972 — 3,613 1,106 5,028 405 441 Debt Service:
Principal — — — — — — —
Interest — — — — — — 68
Total Expenditures 6,050 214 19,473 14,205 12,052 11,091 5,499 Excess (Deficiency) of Revenues
Over (Under) Expenditures 674 380 2,310 10,872 31,212 100 13,112 Other Financing Sources (Uses)
Transfers In 30 — 27 2,074 — 246 1,363
Transfers Out (86) — (1,764) (3,743) (9) (646) (5,279) Total Other Financing
Sources (Uses) (56) — (1,737) (1,669) (9) (400) (3,916) Net Change in Fund Balances 618 380 573 9,203 31,203 (300) 9,196 Fund Balances (Deficit) - Beginning (3,296) 247 15,764 16,345 — 11,501 44,937 Fund Balances (Deficit) - Ending $ (2,678) $ 627 $ 16,337 $ 25,548 $ 31,203 $ 11,201 $ 54,133 189
Debt Service
Capital
Projects
Low and
Moderate
Income
Housing
Special
Assessments City Debt
Financing
Authorities
and
Corporations
City
Combined
Total
Nonmajor
Governmental
Funds
Revenues
$ — $ — $ — $ — $ — $ 91,410 Taxes
28 — — — 25,000 34,142 Intergovernmental
— 6,577 — — — 34,669 Charges for Services
14 (693) 7 35 (1,405) (5,099) Use of Money and Property — 6 — — 924 2,615 Miscellaneous
42 5,890 7 35 24,519 157,737 Total Revenues
Expenditures
Current:
229 — 7 12 — 2,370 General Government
— — — — — 2,791 Public Protection
— 5,426 — — — 42,600 Public Ways and Facilities
— — — — — 7,638 Culture and Recreation
1,182 — — — — 4,408 Community Development
— 6 — — 16,992 32,563 Capital Outlay
Debt Service:
— — 9,962 8,240 — 18,202 Principal
— — 6,496 5,404 — 11,968 Interest
1,411 5,432 16,465 13,656 16,992 122,540 Total Expenditures (1,369) 458 (16,458) (13,621) 7,527 35,197
Excess (Deficiency) of Revenues
Over (Under) Expenditures
Other Financing Sources (Uses)
433 — 16,465 14,752 18,623 54,013 Transfers In
— (746) — (15,380) (778) (28,431) Transfers Out
433 (746) 16,465 (628) 17,845 25,582
Total Other Financing
Sources (Uses)
(936) (288) 7 (14,249) 25,372 60,779 Net Change in Fund Balances 34,686 14,247 3 19,259 5,095 158,788 Fund Balances (Deficit) - Beginning $ 33,750 $ 13,959 $ 10 $ 5,010 $ 30,467 $ 219,567 Fund Balances (Deficit) - Ending 190
CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - High Speed Rail - Special Revenue Fund Fiscal Year Ended June 30, 2022
(in thousands)
Budgeted Amounts Actual
Amounts
Budgetary
Basis
Over
(Under)
Final Budget
Budget
To GAAP
Reconciliation
Actual
Amounts
GAAP
BasisOriginal Final
Budgetary Fund Balance, July 1 $ (12,369) $ (12,369) $ (8,770) $ 3,599 $ 8,770 $ — Resources (inflows):
Intergovernmental 8,830 10,780 6,291 (4,489) — 6,291 Charges for Services 680 680 436 (244) — 436
Use of Money and Property (43) (43) (29) 14 29 —
Miscellaneous — — (3) (3) — (3)
Other Financing Sources:
Transfers from Other Funds 45 45 30 (15) — 30
Total Available
for Appropriations (2,857) (907) (2,045) (1,138) 8,799 6,754 Charges to Appropriations
(outflows):
Public Ways and Facilities 1,304 1,304 1,013 (291) 42 1,055 Community Development 330 330 23 (307) — 23
Capital Outlay — 1,950 5,849 3,899 (877) 4,972
Other Financing Uses:
Transfers to Other Funds — — 86 86 — 86
Total Charges
to Appropriations 1,634 3,584 6,971 3,387 (835) 6,136 Excess (Deficit) Resources
Over (Under) Appropriations $ (4,491) $ (4,491) $ (9,016) $ (4,525) $ 9,634 $ 618 191
CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - Special Gas Tax - Special Revenue Fund Fiscal Year Ended June 30, 2022
(in thousands)
Budgeted Amounts Actual
Amounts
Budgetary
Basis
Over
(Under)
Final Budget
Budget
To GAAP
Reconciliation
Actual
Amounts
GAAP
BasisOriginal Final
Budgetary Fund Balance, July 1 $ 4,205 $ 6,109 $ 8,221 $ 2,112 $ (8,221) $ — Resources (inflows):
Taxes 23,065 23,065 22,524 (541) (298) 22,226
Use of Money and Property 171 170 180 10 (905) (725) Miscellaneous 219 219 317 98 (35) 282
Other Financing Sources:
Transfers From Other Funds — 32 28 (4) (1) 27
Total Available
for Appropriations 27,660 29,595 31,270 1,675 (9,460) 21,810 Charges to Appropriations
(outflows):
Public Ways and Facilities 19,703 21,526 16,428 (5,098) (568) 15,860 Capital Outlay 5,796 7,150 4,223 (2,927) (610) 3,613 Other Financing Uses:
Transfers to Other Funds 43 43 1,611 1,568 153 1,764 Total Charges
to Appropriations 25,542 28,719 22,262 (6,457) (1,025) 21,237 Excess (Deficit) Resources
Over (Under) Appropriations $ 2,118 $ 876 $ 9,008 $ 8,132 $ (8,435) $ 573 192
CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - Measure C - Special Revenue Fund Fiscal Year Ended June 30, 2022
(in thousands)
Budgeted Amounts Actual
Amounts
Budgetary
Basis
Over
(Under)
Final Budget
Budget
To GAAP
Reconciliation
Actual
Amounts
GAAP
BasisOriginal Final
Budgetary Fund Balance, July 1 $ (2,776) $ (2,317) $ 3,039 $ 5,356 $ (3,039) $ — Resources (inflows):
Taxes 22,192 22,673 20,197 (2,476) 3,574 23,771
Use of Money and Property 199 199 230 31 — 230
Miscellaneous 1,551 1,701 1,089 (612) (13) 1,076
Other Financing Sources:
Transfers from Other Funds 17 125 2,903 2,778 (829) 2,074 Total Available
For Appropriations 21,183 22,381 27,458 5,077 (307) 27,151 Charges to Appropriations
(outflows):
Public Ways and Facilities 15,675 16,740 13,310 (3,430) (211) 13,099 Capital Outlay 31,572 31,855 1,177 (30,678) (71) 1,106 Other Financing Uses:
Transfers to Other Funds 250 250 4,343 4,093 (600) 3,743 Total Charges
to Appropriations 47,497 48,845 18,830 (30,015) (882) 17,948 Excess (Deficit) Resources
Over (Under) Appropriations $ (26,314) $ (26,464) $ 8,628 $ 35,092 $ 575 $ 9,203 193
CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - Measure P - Special Revenue Fund Fiscal Year Ended June 30, 2022
(in thousands)
Budgeted Amounts Actual
Amounts
Budgetary
Basis
Over
(Under)
Final Budget
Budget
To GAAP
Reconciliation
Actual
Amounts
GAAP
BasisOriginal Final
Budgetary Fund Balance, July 1 $ — $ — $ — $ — $ — $ —
Resources (inflows):
Taxes 29,573 29,723 35,614 5,891 7,511 43,125
Use of Money and Property — — 125 125 — 125
Miscellaneous — — 14 14 — 14
Other Financing Sources:
Transfers from Other Funds — 2 — (2) — —
Total Available
For Appropriations 29,573 29,725 35,753 6,028 7,511 43,264 Charges to Appropriations
(outflows):
General Government 1,043 1,043 882 (161) 4 886
Public Ways and Facilities — 902 217 (685) (193) 24 Culture and Recreation 10,476 12,657 6,314 (6,343) (200) 6,114 Capital Outlay 10,653 10,958 4,623 (6,335) 405 5,028 Other Financing Uses:
Transfers to Other Funds — — 5 5 4 9
Total Charges
to Appropriations 22,172 25,560 12,041 (13,519) 20 12,061 Excess (Deficit) Resources
Over (Under) Appropriations $ 7,401 $ 4,165 $ 23,712 $ 19,547 $ 7,491 $ 31,203 194
CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - Community Services - Special Revenue Fund Fiscal Year Ended June 30, 2022
(in thousands)
Budgeted Amounts Actual
Amounts
Budgetary
Basis
Over
(Under)
Final Budget
Budget
to GAAP
Reconciliation
Actual
Amounts
GAAP
BasisOriginal Final
Budgetary Fund Balance, July 1 $ 1,516 $ 2,539 $ 4,048 $ 1,509 $ (4,048) $ — Resources (inflows):
Taxes 2,500 2,500 2,471 (29) (183) 2,288
Intergovernmental 4,162 4,262 2,834 (1,428) (15) 2,819 Charges for Services 6,788 16,282 6,134 (10,148) 72 6,206 Use of Money and Property 351 351 575 224 (718) (143) Miscellaneous 5 6 21 15 — 21
Other Financing Sources:
Transfers from Other Funds 495 495 289 (206) (43) 246 Total Available
For Appropriations 15,817 26,435 16,372 (10,063) (4,935) 11,437 Charges to Appropriations
(outflows):
General Government 1,250 1,250 1,235 (15) 1 1,236 Public Protection 3,116 3,511 2,687 (824) (66) 2,621 Public Ways and Facilities 4,111 4,639 1,747 (2,892) 951 2,698 Culture and Recreation 1,552 1,837 964 (873) 178 1,142 Community Development 3,152 3,152 2,989 (163) — 2,989 Capital Outlay 18,690 28,231 455 (27,776) (50) 405 Other Financing Uses:
Transfers to Other Funds 598 598 616 18 30 646
Total Charges
to Appropriations 32,469 43,218 10,693 (32,525) 1,044 11,737 Excess (Deficit) Resources
Over (Under) Appropriations $ (16,652) $ (16,783) $ 5,679 $ 22,462 $ (5,979) $ (300) 195
CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - UGM Impact Fees - Special Revenue Fund Fiscal Year Ended June 30, 2022
(in thousands)
Budgeted Amounts Actual
Amounts
Budgetary
Basis
Over
(Under)
Final Budget
Budget
To GAAP
Reconciliation
Actual
Amounts
GAAP
BasisOriginal Final
Budgetary Fund Balance, July 1 $ 44,884 $ 45,757 $ 44,420 $ (1,337) $ (44,420) $ — Resources (inflows):
Charges for Services 19,335 20,081 20,917 836 323 21,240 Use of Money and Property 452 452 594 142 (3,241) (2,647) Other Financing Sources:
Transfers from Other Funds 32 32 1,654 1,622 (291) 1,363 Total Available
for Appropriations 64,703 66,322 67,603 1,281 (47,629) 19,974 Charges to Appropriations
(outflows):
Public Protection 170 170 170 — — 170
Culture and Recreation 184 201 52 (149) 330 382
Public Ways and Facilities 11,823 12,601 4,423 (8,178) 15 4,438 Capital Outlay 21,581 22,162 907 (21,255) (466) 441 Debt Service
Interest — — — — 68 68
Other Financing Uses:
Transfers to Other Funds 3,628 6,129 6,320 191 (1,041) 5,279 Total Charges
to Appropriations 37,386 41,263 11,872 (29,391) (1,094) 10,778 Excess (Deficit) Resources
Over (Under) Appropriations $ 27,317 $ 25,059 $ 55,731 $ 30,672 $ (46,535) $ 9,196 196
CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - Low and Moderate Income Housing - Special Revenue Fund Fiscal Year Ended June 30, 2022
(in thousands)
Budgeted Amounts Actual
Amounts
Budgetary
Basis
Over
(Under)
Final Budget
Budget
To GAAP
Reconciliation
Actual
Amounts
GAAP
BasisOriginal
Budgetary Fund Balance, July 1 $ — $ — $ — $ — $ —
Resources (inflows):
Intergovernmental 28 28 — — 28
Use of Money and Property 534 14 (520) — 14
Other Financing Sources:
Transfers from Other Funds 830 433 (397) — 433
Total Available
for Appropriations 1,392 475 (917) — 475
Charges to Appropriations (outflows):
General Government 217 229 12 — 229
Community Development 30 1,182 1,152 — 1,182
Total Charges
to Appropriations 247 1,411 1,164,000 — 1,411
Excess (Deficit) Resources
Over (Under) Appropriations $ 1,145 $ (936) $ (2,081) $ — $ (936) 197
CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - Special Assessments - Special Revenue Fund Fiscal Year Ended June 30, 2022
(in thousands)
Budgeted Amounts Actual
Amounts
Budgetary
Basis
Over
(Under)
Final Budget
Budget
To GAAP
Reconciliation
Actual
Amounts
GAAP
BasisOriginal Final
Budgetary Fund Balance, July 1 $ 11,741 $ 12,507 $ 14,023 $ 1,516 $ (14,023) $ — Resources (inflows):
Charges for Services 6,040 6,102 6,577 475 — 6,577 Use of Money and Property 211 211 166 (45) (859) (693) Miscellaneous 10 10 7 (3) (1) 6
Other Financing Sources:
Transfers from Other Funds 379 397 377 (20) (377) — Total Available
for Appropriations 18,381 19,227 21,150 1,923 (15,260) 5,890 Charges to Appropriations
(outflows):
Public Ways and Facilities 9,162 10,014 5,407 (4,607) 19 5,426 Capital Outlay 1,767 1,766 1 (1,765) 5 6
Other Financing Uses:
Transfers to Other Funds 377 377 1,072 695 (326) 746 Total Charges
to Appropriations 11,306 12,157 6,480 (5,677) (302) 6,178 Excess (Deficit) Resources
Over (Under) Appropriations $ 7,075 $ 7,070 $ 14,670 $ 7,600 $ (14,958) $ (288) 198
CITY OF FRESNO, CALIFORNIA
Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP Budgetary Basis) - City Combined - Capital Projects Fund Fiscal Year Ended June 30, 2022
(in thousands)
Budgeted Amounts Actual
Amounts
Budgetary
Basis
Over
(Under)
Final Budget
Budget
To GAAP
Reconciliation
Actual
Amounts
GAAP
BasisOriginal Final
Budgetary Fund Balance, July 1 $ (13,306) $ (12,895) $ (11,742) $ 1,153 $ 11,742 $ — Resources (inflows):
Intergovernmental — 25,000 25,000 — — 25,000
Use of Money and Property 42 42 132 90 (1,537) (1,405) Miscellaneous 3,219 5,602 16,294 10,692 (15,370) 924 Other Financing Sources:
Transfers Budgeted as
Bond Proceeds 15,609 18,109 3,520 (14,589) 15,103 18,623 Total Available
for Appropriations 5,564 35,858 33,204 (2,654) 9,938 43,142 Charges to Appropriations
(outflows):
Capital Outlay 3,835 34,791 18,593 (16,198) (1,601) 16,992 Other Financing Uses:
Transfers to Other Funds — — 1,031 1,031 (253) 778 Total Charges
to Appropriations 3,835 34,791 19,624 (15,167) (1,854) 17,770 Excess (Deficit) Resources
Over (Under) Appropriations $ 1,729 $ 1,067 $ 13,580 $ 12,513 $ 11,792 $ 25,372 199
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CITY OF FRESNO, CALIFORNIA
Combining Statement of Net Position
Nonmajor Enterprise Funds
June 30, 2022
(in thousands)
Business-Type Activities - Enterprise Funds
Community
Sanitation
Parks and
Recreation
Total Nonmajor
Enterprise Funds
Assets
Current Assets:
Cash and Investments $ 2,767 $ — $ 2,767
Interest Receivable 15 3 18
Accounts Receivable, Net 1,915 1,596 3,511
Due from Other Funds 909 — 909
Total Current Assets 5,606 1,599 7,205
Noncurrent Assets:
Restricted:
Cash and Investments — 969 969
Total Restricted Assets — 969 969
Other Assets:
Other Assets — 14 14
Net Pension Asset 6,825 — 6,825
Total Other Assets 6,825 14 6,839
Capital Assets:
Land and Intangibles — 12 12
Buildings, Systems and Improvements — 3,743 3,743
Machinery and Equipment 67 — 67
Infrastructure — 122 122
Less Accumulated Depreciation (62) (2,225) (2,287)
Total Capital Assets, Net 5 1,652 1,657
Total Noncurrent Assets 6,830 2,635 9,465
Total Assets 12,436 4,234 16,670
Deferred Outflows of Resources
Charge on Refunding — 50 50
Deferred Outflows - Pensions 614 — 614
Deferred Outflows - OPEB 416 — 416
Total Deferred Outflows of Resources 1,030 50 1,080
Liabilities
Current Liabilities:
Accrued Liabilities 157 71 228
Accrued Compensated Absences and HRA 36 1 37
Due to Other Funds 133 512 645
Bonds Payable — 60 60
Total Current Liabilities 326 644 970
Noncurrent Liabilities:
Accrued Compensated Absences and HRA 324 3 327
Bonds Payable — 1,488 1,488
Net OPEB Liability 1,158 — 1,158
Total Noncurrent Liabilities 1,482 1,491 2,973
Total Liabilities 1,808 2,135 3,943
Deferred Inflows of Resources
Unamortized Pension Expense 3,809 — 3,809
Unamortized OPEB Expense 982 — 982
Deferred Inflows - Leases — 1,557 1,557
Total Deferred Inflows of Resources 4,791 1,557 6,348 Net Position
Net Investment in Capital Assets 5 153 158
Unrestricted 6,862 439 7,301
Total Net Position $ 6,867 $ 592 $ 7,459
201
CITY OF FRESNO, CALIFORNIA
Combining Statement of Revenues, Expenses and Changes in Fund Net Position Nonmajor Enterprise Funds
Fiscal Year Ended June 30, 2022
(in thousands)
Business-Type Activities - Enterprise Funds
Community
Sanitation
Parks and
Recreation
Total Nonmajor
Enterprise Funds
Operating Revenues:
Charges for Services $ 10,705 $ 630 $ 11,335
Operating Expenses:
Cost of Services 5,377 108 5,485
Administration 2,971 62 3,033
Depreciation 3 185 188
Total Operating Expenses 8,351 355 8,706
Operating Income (Loss) 2,354 275 2,629
Non-Operating Revenue (Expenses):
Interest Income 36 41 77
Net Increase (Decrease) in Cash Fair Value (168) — (168) Interest Expense — (61) (61)
Total Non-Operating Revenue (Expenses) (132) (20) (152) Income (Loss) Before Transfers 2,222 255 2,477
Transfers In 1,300 — 1,300
Transfers Out (1,025) — (1,025)
Change in Net Position 2,497 255 2,752
Total Net Position - Beginning 4,370 337 4,707
Total Net Position - Ending $ 6,867 $ 592 $ 7,459
202
CITY OF FRESNO, CALIFORNIA
Combining Statement of Cash Flows
Nonmajor Enterprise Funds
Fiscal Year Ended June 30, 2022
(in thousands)
Business-Type Activities - Enterprise Funds
Community
Sanitation
Parks and
Recreation
Total Nonmajor
Enterprise Funds
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash Received from Customers $ 9,563 $ 1,144 $ 10,707
Cash Payments to Suppliers for Services (2,486) (306) (2,792) Cash Paid for Interfund Services Used (2,059) — (2,059) Cash Payments to Employees for Services (5,084) — (5,084) Net Cash Provided by (Used for) Operating Activities (66) 838 772
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:
Interest Payments on Capital Debt — (78) (78)
Payment for Cost of Issuance — 5 5
Principal Payments on Capital Debt-Bonds — (55) (55) Acquisition and Construction of Capital Assets — (53) (53) Net Cash Provided by (Used for) Capital and Related Financing Activities — (181) (181)
CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES:
Borrowing Receipt from (Payment to) Other Funds — (512) (512) Transfers In 1,300 — 1,300
Transfers Out (1,025) — (1,025)
Net Cash Provided by (Used for) Non-Capital Financing
Activities 275 (512) (237)
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest and Dividends Received (Paid) on Investments (135) 42 (93) Net Cash Provided by (Used for) Investing Activities (135) 42 (93) Net Increase (Decrease) in Cash and Cash Equivalents 74 187 261 Cash and Cash Equivalents, Beginning of Year 2,693 782 3,475 Cash and Cash Equivalents, End of Year $ 2,767 $ 969 $ 3,736 203
CITY OF FRESNO, CALIFORNIA
Combining Statement of Cash Flows
Nonmajor Enterprise Funds
Fiscal Year Ended June 30, 2022 (Continued)
Business-Type Activities - Nonmajor Enterprise Funds
Community
Sanitation
Parks and
Recreation
Total Nonmajor
Enterprise Funds
Reconciliation of Operating Income (Loss) to Net Cash
Provided by (Used for) Operating Activities:
Operating income (loss) $ 2,354 $ 275 $ 2,629
Adjustments to reconcile operating income (loss) to net cash provided by operating activities:
Depreciation expense 3 185 188
Change in assets and liabilities:
Decrease (increase) in accounts receivable (171) (1,596) (1,767) Decrease (increase) in prepaid items 6 — 6
Decrease (increase) in net pension asset and deferred outflows pensions (4,774) — (4,774) Decrease (increase) in prepaid insurance — 1 1
(Decrease) increase in accounts payable (74) (128) (202) (Decrease) increase in salaries payable (103) (9) (112) (Decrease) increase in due to other funds (132) 553 421 (Decrease) increase in net OPEB liability (717) — (717) (Decrease) increase in deferred inflows of resources pensions 4,452 1,557 6,009 Net Cash Provided by (Used for) Operating Activities $ (66) $ 838 $ 772 Reconciliation of Cash and Cash Equivalents to
the Statement of Net Position:
Cash and Investments:
Unrestricted $ 2,767 $ — $ 2,767
Restricted - Current and Noncurrent — 969 969
Cash and Cash Equivalents at End of Year on Statement
of Cash Flows $ 2,767 $ 969 $ 3,736
Noncash Investing, Capital, and Financing Activities:
Amortization of bond premium, discount and loss on refunding — (16) (16) Decrease (increase) in fair value of investments (133) — (133) 204
Assets
Current Assets:
Cash and Investments $ 20,472 $ 72,047 $ 8,222 $ 30,605 $ — $ 131,346 Interest Receivable 95 214 51 161 — 521
Accounts Receivable, Net 880 370 248 327 — 1,825
Inventories — 1,073 — — — 1,073
Prepaid Items — 562 — — — 562
Due from Other Funds 186 2,650 8 — — 2,844
Total Current Assets 21,633 76,916 8,529 31,093 — 138,171 Noncurrent Assets:
Restricted:
Cash and Investments 4,437 — 889 — — 5,326
Total Restricted Assets 4,437 — 889 — — 5,326
Other Assets:
Net Pension Asset 9,807 28,871 — — — 38,678
Total Other Assets 9,807 28,871 — — — 38,678
Capital Assets:
Buildings, Systems & Improvements 125 12,401 — — — 12,526 Machinery & Equipment 121 147,589 — — — 147,710
Right to Use Assets Being Amortized — 3,235 — — — 3,235 Construction in Progress 45 27,259 — — — 27,304
Less Accumulated Depreciation and
Amortization (121) (93,226) — — — (93,347)
Total Capital Assets, Net 170 97,258 — — — 97,428 Total Noncurrent Assets 14,414 126,129 889 — — 141,432 Total Assets 36,047 203,045 9,418 31,093 — 279,603 Deferred Outflows of Resources
Pension Contributions 612 1,791 — — — 2,403
Deferred Outflows - Pension 357 890 — — — 1,247
Deferred Outflows - OPEB 792 1,406 148 — — 2,346
Total Deferred Outflows of Resources 1,761 4,087 148 — — 5,996
CITY OF FRESNO, CALIFORNIA
Combining Statement of Net Position
Internal Service Funds
June 30, 2022
(in thousands)
Billing
and
Collection
General
Services
Risk
Management
Employees
Healthcare
Plan
Retirees
Healthcare
Plan Totals
205
Liabilities
Current Liabilities:
Accrued Liabilities 1,033 6,604 1,187 — — 8,824
Accrued Compensated Absences & HRA 274 420 39 — — 733 Liability for Self-Insurance — — 30,346 7,400 — 37,746 Unearned Revenue 1,066 4,778 — — — 5,844
Due to Other Funds 18,085 15,062 — — — 33,147
Capital Finance Obligations — 6,925 — — — 6,925
Lease Liability — 407 — — — 407
Total Current Liabilities 20,458 34,196 31,572 7,400 — 93,626 Noncurrent Liabilities:
Accrued Compensated Absences & HRA 1,472 3,601 173 — — 5,246 Capital Lease Obligations — 29,843 — — — 29,843
Liability for Self-Insurance — — 170,181 — — 170,181 Lease Liability — 2,431 — — — 2,431
Net OPEB Liability 2,198 2,328 (728) — — 3,798
Deposits Held for Others 4,679 — — — — 4,679
Total Noncurrent Liabilities 8,349 38,203 169,626 — — 216,178 Total Liabilities 28,807 72,399 201,198 7,400 — 309,804 Deferred Inflows of Resources
Unamortized Pension Expense 5,889 17,806 — — — 23,695 Unamortized OPEB Expense 2,130 4,976 1,275 — — 8,381 Deferred Inflows - Leases — 343 — — — 343
Total Deferred Inflows of Resources 8,019 23,125 1,275 — — 32,419 Net Position
Net Investment in Capital Assets 170 57,652 — — — 57,822 Unrestricted (Deficit) 812 53,956 (192,907) 23,693 — (114,446) Total Net Position (Deficit) $ 982 $ 111,608 $ (192,907) $ 23,693 $ — $ (56,624)
CITY OF FRESNO, CALIFORNIA
Combining Statement of Net Position
Internal Service Funds
June 30, 2022
(in thousands)
Billing
and
Collection
General
Services
Risk
Management
Employees
Healthcare
Plan
Retirees
Healthcare
Plan Totals
206
CITY OF FRESNO, CALIFORNIA
Combining Statement of Revenues, Expenses and Changes in Fund Net Position Internal Service Funds
Fiscal Year Ended June 30, 2022
(in thousands)
Billing
and
Collection
General
Services
Risk
Management
Employees
Healthcare
Plan
Retirees
Healthcare
Plan Totals
Operating Revenues:
Charges for Services $ 12,531 $ 80,288 $ 42,559 $ 53,003 $ 7,331 $ 195,712 Operating Expenses:
Cost of Services 6,860 45,983 52,032 48,987 6,745 160,607 Administration 5,182 13,834 9,459 5,386 586 34,447 Depreciation — 14,145 — — — 14,145
Total Operating Expenses 12,042 73,962 61,491 54,373 7,331 209,199 Operating Income (Loss) 489 6,326 (18,932) (1,370) — (13,487) Non-Operating Revenue (Expenses):
Interest Income 226 563 117 402 — 1,308
Net Increase (Decrease) in Cash Fair Value (1,303) (3,325) (615) — — (5,243) Interest Expense — (778) — — — (778)
Gain (loss) on Disposal of Capital Assets — — — — — — Total Non-Operating Revenue (Expenses) (1,077) (3,540) (498) 402 — (4,713) Income (Loss) Before Contributions &
Transfers (588) 2,786 (19,430) (968) — (18,200)
Transfers In 1,095 3,035 — — — 4,130
Transfers Out (310) (914) (30) — — (1,254)
Change in Net Position 197 4,907 (19,460) (968) — (15,324) Total Net Position (Deficit) - Beginning 785 106,701 (173,447) 24,661 — (41,300) Total Net Position (Deficit) - Ending $ 982 $ 111,608 $ (192,907) $ 23,693 $ — $ (56,624) 207
CITY OF FRESNO, CALIFORNIA
Combining Statement of Cash Flows
Internal Service Funds
Fiscal Year Ended June 30, 2022
(in thousands)
Billing and
Collection
General
Services
Risk
Management
Employees
Healthcare
Plan
Retirees
Healthcare
Plan Total
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash Received from Customers $ 32,050 $ 64,893 $ — $ 11,815 $ 4,926 $ 113,684 Cash Received from Interfund Services Provided 33 25,351 75,359 41,189 2,405 144,337 Cash Payments from (to) Suppliers for Services 8,799 (38,343) (9,331) (5,140) (586) (44,601) Cash Paid for Interfund Services Used (15,840) (4,857) (168) — — (20,865) Cash Payments to Employees for Services (8,113) (22,808) (6,409) — — (37,330) Cash Payments for Claims and Refunds (63,546) (48,988) (6,745) (119,279) Net Cash Provided by (Used for) Operating
Activities 16,929 24,236 (4,095) (1,124) — 35,946
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:
Capital Contributions — 19,071 — — — 19,071
Interest Payments on Capital Debt — (631) — — — (631) Principal Payments on Capital Lease Obligations — (6,276) — — — (6,276) Acquisition and Construction of Capital Assets (27) (22,935) — — — (22,962) Net Cash Provided by (Used for) Capital and
Related Financing Activities (27) (10,771) — — — (10,798)
CASH FLOWS FROM NON-CAPITAL FINANCING
ACTIVITIES:
Borrowing Receipt from (Payment to) Other Funds (186) 4,692 — — — 4,506 Transfers In 1,095 3,035 — — — 4,130
Transfers Out (310) (914) (30) — — (1,254)
Net Cash Provided by (Used for) Non-Capital
Financing Activities 599 6,813 (30) — — 7,382
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest and Dividends Received (Paid) on Investments (1,088) (2,820) (476) 406 — (3,978) Net Cash Provided by (Used for) Investing
Activities (1,088) (2,820) (476) 406 — (3,978)
Net Increase (Decrease) in Cash and Cash Equivalents 16,413 17,458 (4,601) (718) — 28,552 Cash and Cash Equivalents, Beginning of Year 8,496 54,589 13,712 31,323 — 108,120 Cash and Cash Equivalents, End of Year $ 24,909 $ 72,047 $ 9,111 $ 30,605 $ — $ 136,672 208
CITY OF FRESNO, CALIFORNIA
Combining Statement of Cash Flows
Internal Service Funds
Fiscal Year Ended June 30, 2022 (Continued)
Billing and
Collection
General
Services
Risk
Management
Employees
Healthcare
Plan
Retirees
Healthcare
Plan Total
Reconciliation of Operating Income (Loss) to Net
Cash Provided by (Used for) Operating Activities:
Operating income (loss) $ 489 $ 6,326 $ (18,932) $ (1,370) $ — $ (13,487) Adjustments to reconcile operating income (loss) to net cash provided by (used for) operating activities:
Depreciation expense — 14,145 — — — 14,145
Change in assets and liabilities:
Decrease (increase) in accounts receivable 541 (348) (39) (327) — (173) Decrease (increase) in due from other funds — 1,323 (8) — — 1,315 Decrease (increase) in material and supplies inventory — (186) — — — (186) Decrease (increase) in prepaid items (1) (2) 25 — — 22 Decrease (increase) in net pension asset and deferred
outflows pensions (7,313) (22,352) (21) — — (29,686) (Decrease) increase in accounts payable (792) (969) (65) (327) — (2,153) (Decrease) increase in salaries payable (111) 765 111 — — 765 (Decrease) increase in due to other funds 18,062 3,334 — — — 21,396 (Decrease) increase in unearned revenue 89 4,201 — — — 4,290 (Decrease) increase in liability for self-insurance — — 14,794 900 — 15,694 (Decrease) increase in deposits 195 — — — — 195
(Decrease) increase in net OPEB liability (1,596) (4,007) (1,158) — — (6,761) (Decrease) increase in deferred inflows of resources
pensions 7,366 22,006 1,198 — 30,570
Net Cash Provided by (Used for) Operating
Activities $ 16,929 $ 24,236 $ (4,095) $ (1,124) $ — $ 35,946 Reconciliation of Cash and Cash Equivalents
to the Statement of Net Position:
Cash and Investments:
Unrestricted $ 20,472 $ 72,047 $ 8,222 $ 30,605 $ — $ 131,346 Restricted - Current and Noncurrent 4,437 — 889 — — 5,326 Cash and Cash Equivalents at End of Year
on Statement of Cash Flows $ 24,909 $ 72,047 $ 9,111 $ 30,605 $ — $ 136,672 Noncash Investing, Capital, and Financing Activities:
Acquisition and construction of capital assets on
accounts payable $ 45 $ 2,854 $ — $ — $ — $ 2,899
Borrowing under capital financing — 20,827 — — — 20,827 Decrease (increase) in fair value of investments (1,193) (2,653) (437) — — (4,283) 209
CITY OF FRESNO, CALIFORNIA
Combining Statement of Fiduciary Net Position
Fiduciary Funds - Pension Trust Funds
June 30, 2022
(in thousands)
Pension Trust Funds
Fire and Police Employees
Retirement Retirement Total
System System
Assets
Cash and Investments $ 1,095 $ 873 $ 1,968
Receivables:
Receivables for Investments Sold 15,858 13,125 28,983 Interest and Dividends Receivable 3,066 2,532 5,598
Other Receivables 1,281 1,058 2,339
Total Receivables 20,205 16,715 36,920
Investments, at Fair Value:
Short-Term Investments 7,182 5,930 13,112
Domestic Equity 577,968 477,241 1,055,209
Corporate Bonds 203,487 168,024 371,511
International Developed Market Equities 242,802 200,487 443,289 Government Bonds 112,293 92,723 205,016
Alternatives 464,780 383,780 848,560
Real Estate 291,143 241,010 532,153
Total Investments, at Fair Value 1,899,655 1,569,195 3,468,850 Collateral Held for Securities Lent 71,909 59,377 131,286 Capital Assets, Net of Accumulated Depreciation 482 482 964 Other Assets 156 156 312
Total Assets 1,993,502 1,646,798 3,640,300
Liabilities
Accrued Liabilities 28,552 23,576 52,128
Collateral Held for Securities Lent 71,909 59,377 131,286 Other Liabilities 1,965 1,658 3,623
Total Liabilities 102,426 84,611 187,037
Net Position
Net Position Restricted for Pension Benefits $ 1,891,076 $ 1,562,187 $ 3,453,263 210
CITY OF FRESNO, CALIFORNIA
Combining Statement of Changes in Fiduciary Net Position Fiduciary Funds - Pension Trust Funds
Fiscal Year Ended June 30, 2022
(in thousands)
Pension Trust Funds
Fire and Police Employees
Retirement Retirement Total
System System
Additions
Contributions:
Employer $ 27,556 $ 22,017 $ 49,573
System Members 10,973 15,493 26,466
Total Contributions 38,529 37,510 76,039
Investment Income:
Net Appreciation in Fair Value of Investments (167,440) (138,316) (305,756) Interest 10,070 8,329 18,399
Dividends 16,940 14,003 30,943
Other Investment Related 67 57 124
Total Investment Income (140,363) (115,927) (256,290) Less Investment Expense (20,480) (16,967) (37,447)
Total Net Investment Income (160,843) (132,894) (293,737) Securities Lending Income:
Securities Lending Earnings 484 400 884
Less Securities Lending Expense (159) (132) (291)
Net Securities Lending Income 325 268 593
Total Additions (121,989) (95,116) (217,105)
Deductions
Benefit Payments (including post retirement supplemental benefits) 74,810 70,239 145,049
Refund of Contributions 369 1,645 2,014
General and Administrative Expenses 2,126 2,050 4,176 Total Deductions 77,305 73,934 151,239
Change in Net Position (199,294) (169,050) (368,344) Net Position - Beginning 2,090,370 1,731,237 3,821,607 Net Position - Ending $ 1,891,076 $ 1,562,187 $ 3,453,263 211
CITY OF FRESNO, CALIFORNIA
Combining Statement of Fiduciary Net Position
Custodial Funds
Fiscal Year Ended June 30, 2022
(in thousands)
City Special Total
Departmental Assessment District Custodial Funds
Assets
Cash and Investments $ 3,073 $ 227 $ 3,300
Restricted Cash and Investments Held by Fiscal Agent — 554 554 Interest Receivable 9 — 9
Due From Other Governments — 379 379
Total Assets $ 3,082 $ 1,160 $ 4,242
Liabilities
Accrued Liabilities $ 20 $ — $ 20
Due to Other Funds 103 — 103
Due to Other Governments 3 — 3
Total Liabilities $ 126 $ — $ 126
Net Position
Restricted for:
Individuals, Organizations, and Other Governments 2,956 1,160 4,116 Total Net Position $ 2,956 $ 1,160 $ 4,116
212
CITY OF FRESNO, CALIFORNIA
Combining Statement of Changes in Fiduciary Net Position Custodial Funds
Fiscal Year Ended June 30, 2022
(in thousands)
City Special Total
Departmental Assessment District Custodial Funds
Additions:
Fees Collected for Organizations and Other Governments $ 4,744 $ — $ 4,744 Taxes Collected for Organizations and Other Governments 601 — 601 Special Assessments for Organizations and Other
Governments — 100 100
Investment Income 22 1 23
Total Additions 5,367 101 5,468
Deductions:
Payments on Conduit Bonds - Principal $ — $ 270 $ 270
Payments on Conduit Bonds - Interest — 167 167
Payments to Individuals, Organizations, and Other
Governments 4,839 44 4,883
Total Deductions 4,839 481 5,320
Change in Net Position 528 (380) 148
Net Position:
Beginning of Year, Restated 2,428 1,540 3,968
Restricted for Individuals, Organizations, and Other
Governments $ 2,956 $ 1,160 $ 4,116
213
Statistical Section
This section of the City's Annual Comprehensive Financial Report (ACFR) presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City's financial health.
Contents
Financial Trends
These schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time. (pages 215-219) Revenue Capacity
These schedules contain information to help the reader assess the City's most significant local revenue source: The property tax. (pages 220-223)
Debt Capacity
These schedules present information to help the reader assess the affordability of the City's current levels of outstanding debt and the City's ability to issue additional debt in the future. (pages 224-232) Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the environment within which the City's financial activities take place. (pages 233-234) Operating Information
These schedules contain information about the City's operations and resources to help the reader understand how the City's financial information relates to the services the City provides and the activities it performs. (pages 235-239)
Source(s):
Unless otherwise noted, the information in these schedules is derived from the annual comprehensive financial reports for the relevant year.
CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2022 214
CITY OF FRESNO, CALIFORNIA
Net Position By Component
Last Ten Fiscal Years
(dollars in thousands)
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Governmental Activities
Net Investment in Capital
Assets $ 733,961 $ 744,074 $ 771,198 $ 795,884 $ 787,522 $ 796,242 $ 793,963 $ 787,395 $ 794,759 $ 836,439 Restricted 125,618 141,123 146,174 151,345 168,927 171,473 178,858 239,898 304,925 308,444 Unrestricted (Deficit) (235,759) (215,416) (86,424) (22,058) 28,252 43,380 105,676 27,932 (76,811) 56,963 Total Governmental
Activities $ 623,820 $ 669,781 $ 830,948 $ 925,171 $ 984,701 $ 1,011,095 $ 1,078,497 $ 1,055,225 $ 1,022,873 $ 1,201,846 Business-Type Activities
Net Investment in Capital
Assets $ 829,455 $ 835,290 $ 841,773 $ 896,818 $ 955,128 $ 958,169 $ 1,054,185 $ 1,090,352 $ 1,120,876 $ 1,094,088 Restricted — — — — — — — — — —
Unrestricted (Deficit) 219,983 264,090 300,296 307,315 353,436 440,872 414,184 472,210 460,988 526,841 Total Business-Type
Activities $ 1,049,438 $ 1,099,380 $ 1,142,069 $ 1,204,133 $ 1,308,564 $ 1,399,041 $ 1,468,369 $ 1,562,562 $ 1,581,864 $ 1,620,929 Primary Government
Net Investment in Capital
Assets $ 1,563,416 $ 1,579,364 $ 1,612,971 $ 1,692,702 $ 1,742,650 $ 1,754,411 $ 1,848,148 $ 1,877,747 $ 1,915,635 $ 1,930,527 Restricted 125,618 141,123 146,174 151,345 168,927 171,473 178,858 239,898 304,925 308,444 Unrestricted (Deficit) (15,776) 48,674 213,872 285,257 381,688 484,252 519,860 500,142 384,177 583,804 Total Primary
Government $ 1,673,258 $ 1,769,161 $ 1,973,017 $ 2,129,304 $ 2,293,265 $ 2,410,136 $ 2,546,866 $ 2,617,787 $ 2,604,737 $ 2,822,775 Source(s): City of Fresno, Finance Department
Fiscal Years
$ Dollars
Governmental Activities
Net Investment in Capital AssetsRestrictedUnrestricted
2013201420152016201720182019202020212022
$-400,000,000
$-200,000,000
$0
$200,000,000
$400,000,000
$600,000,000
$800,000,000
$1,000,000,000
Fiscal Years
$ Dollars
Business-Type Activities
Net Investment in Capital AssetsRestrictedUnrestricted
2013201420152016201720182019202020212022
$0
$200,000,000
$400,000,000
$600,000,000
$800,000,000
$1,000,000,000
$1,200,000,000
215
CITY OF FRESNO, CALIFORNIA
Change in Net Position
Last Ten Fiscal Years
(dollars in thousands)
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Expenses
Governmental Activities:
General Government $ 34,308 $ 26,997 $ 28,590 $ 32,206 $ 44,157 $ 31,319 $ 42,785 $ 46,114 $ 90,218 $ 90,035 Public Protection 190,050 192,124 177,829 187,733 196,006 206,163 214,903 271,085 305,172 270,465 Public Ways and Facilities 69,771 68,914 64,430 60,875 72,984 76,289 80,369 93,243 123,068 101,306 Culture and Recreation 16,704 17,895 20,036 20,223 23,500 19,771 23,809 26,039 30,882 30,324 Community Development 26,280 23,757 29,257 28,789 28,913 30,412 29,188 31,102 41,053 57,123 Redevelopment — — — — — — — — — —
Interest on Long-Term Debt 21,037 20,275 19,519 18,787 18,658 14,413 14,101 13,652 12,552 12,683 Total Governmental Activities 358,150 349,962 339,661 348,613 384,218 378,367 405,155 481,235 602,945 561,936 Business-Type Activities:
Water System 60,749 63,375 62,205 64,454 63,753 73,677 94,066 101,406 100,181 112,301 Sewer System 63,736 65,145 66,148 63,980 64,124 65,991 71,793 65,166 74,428 78,646 Solid Waste Management 30,257 33,345 32,976 26,650 26,605 30,353 31,702 36,915 41,713 41,818 Transit 48,398 45,287 45,435 44,191 47,958 53,937 57,864 62,016 66,135 71,038 Airports 32,413 28,498 28,164 28,509 29,938 31,192 33,262 35,984 41,090 40,413 Fresno Convention Center 14,928 9,982 10,147 9,750 10,798 8,856 8,701 7,108 5,096 9,235 Community Sanitation 7,848 7,949 8,235 6,904 8,978 10,077 10,093 9,147 8,698 8,743 Parking — — — — — — — — — —
Parks and Recreation 812 372 340 316 410 283 502 586 572 416 Development Services — — — — — — — — — —
Stadium 3,463 3,336 3,266 3,191 3,539 2,710 2,600 2,702 2,739 2,925 Total Business-Type Activities 262,604 257,289 256,916 247,945 256,103 277,076 310,583 321,030 340,652 365,535 Total Primary Government Expenses $ 620,754 $ 607,251 $ 596,577 $ 596,558 $ 640,321 $ 655,443 $ 715,738 $ 802,265 $ 943,597 $ 927,471 Program Revenues
Governmental Activities:
Charges for Services:
General Government $ 18,634 $ 17,038 $ 23,194 $ 22,580 $ 46,742 $ 17,171 $ 19,075 $ 14,805 $ 15,315 $ 22,040 Public Protection 20,924 18,898 31,872 44,037 22,382 32,275 40,945 15,599 16,544 62,152 Public Ways and Facilities 16,669 14,898 17,426 20,468 21,911 21,009 20,461 22,219 27,060 37,839 Culture and Recreation 3,021 4,680 4,577 4,949 3,645 3,935 3,711 1,742 1,364 4,840 Community Development 19,529 19,432 21,130 25,239 23,496 23,033 20,347 19,400 13,050 32,305 Operating Grants and Contributions 36,639 48,503 39,550 34,015 25,016 26,488 40,278 39,037 40,393 74,245 Capital Grants and Contributions 35,623 49,651 62,472 57,955 44,586 38,584 37,525 49,161 135,064 128,553 Total Governmental Activities Program
Revenues 151,039 173,100 200,221 209,243 187,778 162,495 182,342 161,963 248,790 361,974 Business-Type Activities:
Charges for Services:
Water System 71,667 90,096 74,285 77,959 101,895 107,377 119,029 120,252 127,651 138,492 Sewer System 76,324 76,201 81,955 78,186 83,635 81,651 81,085 77,249 77,940 87,795 Solid Waste Management 29,797 29,404 31,208 31,975 31,170 30,100 31,804 29,546 29,132 35,423 Transit 11,054 10,914 13,089 12,479 11,452 10,746 9,348 2,516 (2,328) 11,242 Airports 23,329 24,991 25,670 27,646 27,835 29,634 32,011 29,192 25,991 40,884 Fresno Convention Center 2,594 2,626 2,960 3,634 3,752 3,318 3,796 2,415 (2) 5,744 Community Sanitation 9,108 8,956 9,746 9,733 9,613 9,422 9,841 8,982 8,786 10,706 Parking — — — — — — — — — —
Parks and Recreation 736 329 329 325 340 323 410 278 411 630 Development Services — — — — — — — — — —
Stadium 1,089 798 1,248 677 1,082 238 406 344 580 279 Operating Grants and Contributions 40,850 44,211 40,215 29,190 37,187 22,939 37,910 80,766 56,334 71,273 Capital Grants and Contributions 22,224 14,754 14,791 18,015 47,576 69,570 33,249 38,027 29,884 17,893 Total Business-Type Activities Program
Revenues 288,772 303,280 295,496 289,819 355,537 365,318 358,889 389,567 354,379 420,361 Total Primary Government Program
Revenues $ 439,811 $ 476,380 $ 495,717 $ 499,062 $ 543,315 $ 527,813 $ 541,231 $ 551,530 $ 603,169 $ 782,335 216
CITY OF FRESNO, CALIFORNIA
Change in Net Position
Last Ten Fiscal Years (Continued)
(dollars in thousands)
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Net (Expense)/Revenue
Governmental Activities $ (207,111) $ (176,862) $ (139,440) $ (139,370) $ (196,440) $ (215,872) $ (222,813) $ (319,272) $ (354,155) $ (199,962) Business-Type Activities 26,168 45,991 38,580 41,874 99,434 88,242 48,306 68,537 13,727 54,826 Total Primary Government Net Expense $ (180,943) $ (130,871) $ (100,860) $ (97,496) $ (97,006) $ (127,630) $ (174,507) $ (250,735) $ (340,428) $ (145,136) General Revenues and Other Changes
in Net Position
Governmental Activities:
Property Taxes $ 103,745 $ 107,635 $ 113,655 $ 117,048 $ 123,858 $ 130,109 $ 138,201 $ 142,250 $ 149,822 $ 154,130 Sales Taxes - Shared Revenues 56,474 59,328 61,571 74,010 86,128 85,512 96,939 98,531 125,279 192,874 In-Lieu Sales Tax 18,216 19,190 19,907 10,559 — — — — — — Franchise Taxes 12,503 12,751 13,469 13,722 14,335 14,811 14,493 16,101 17,729 18,271 Business Tax 16,470 18,868 17,781 16,879 19,101 20,982 18,162 20,868 20,577 21,764 Room Tax 9,560 10,019 11,006 12,045 13,127 13,936 13,998 12,453 12,566 15,205 Other Taxes 2,104 2,324 2,407 2,521 2,348 2,304 2,855 2,241 1,825 3,528 Investment Earnings 1,889 795 879 1,652 1,215 1,348 8,413 11,863 1,786 (10,409) Gain on Sale of Capital Assets 416 42 402 218 214 223 2,517 2 — — Special Item - Loss on Receivable/
Transfer of Assets — — — — — (8,152) — — — —
Extraordinary (Loss):
Redevelopment Agency Net Position
Distributed to Successor Agency — — — — — — — — — — Transfers: (15,662) (5,699) (6,290) (15,061) (4,356) (4,820) (5,363) (8,309) (7,781) (7,899) Total Governmental Activities 205,715 225,253 234,787 233,593 255,970 256,253 290,215 296,000 321,803 387,464 Business-Type Activities:
Investment Earnings 1,596 2,316 2,998 5,129 641 2,614 15,624 17,316 (2,206) (24,697) Debt Forgiveness — — — — — — — — — —
Gain on Sale of Capital Assets 3,832 1 38 — — 36 35 31 — — Transfers: 15,662 5,698 6,290 15,061 4,356 4,820 5,363 8,309 7,781 7,899 Total Business-Type Activities 21,090 8,015 9,326 20,190 4,997 7,470 21,022 25,656 5,575 (16,798) Total Primary Government $ 226,805 $ 233,268 $ 244,113 $ 253,783 $ 260,967 $ 263,723 $ 311,237 $ 321,656 $ 327,378 $ 370,666 Change in Net Position
Governmental Activities $ (1,397) $ 48,391 $ 95,347 $ 94,223 $ 59,530 $ 40,381 $ 67,402 $ (23,272) $ (32,352) $ 187,502 Business-Type Activities 47,259 54,006 47,906 62,064 104,431 95,712 69,328 94,193 19,302 38,028 Total Primary Government $ 45,862 $ 102,397 $ 143,253 $ 156,287 $ 163,961 $ 136,093 $ 136,730 $ 70,921 $ (13,050) $ 225,530 Source(s): City of Fresno, Finance Department
217
CITY OF FRESNO, CALIFORNIA
Fund Balances, Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
(dollars in thousands)
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
General Fund
Nonspendable $ 12,691 $ 12,691 $ 12,691 $ 12,691 $ 18,417 $ 3,919 $ 2,071 $ — $ — $ — Restricted 435 7 105 11 37 16 10 6 — —
Committed 1,903 2,351 5,207 1,610 22,104 25,565 37,004 37,718 40,655 48,360 Assigned 1,095 1,006 1,874 2,811 3,890 2,845 4,562 5,158 19,249 19,215 Unassigned (9,355) 8,192 24,643 31,808 26,749 19,533 25,312 33,046 43,039 37,116 Total General Fund $ 6,769 $ 24,247 $ 44,520 $ 48,931 $ 71,197 $ 51,878 $ 68,959 $ 75,928 $ 102,943 $ 104,691 All other
Governmental Funds
Restricted $ 128,100 $ 145,763 $ 146,002 $ 151,726 $ 163,802 $ 166,207 $ 172,587 $ 197,325 $ 255 $ 216,922 Assigned 17,624 15,752 15,928 15,847 12,177 16,115 16,137 11,194 13 37,622 Unassigned (5,196) (7,749) (9,670) (6,284) (788) (809) (1,950) (5,590) (57) (2,678) Total all other
Governmental Funds $ 140,528 $ 153,766 $ 152,260 $ 161,289 $ 175,191 $ 181,513 $ 186,774 $ 202,929 $ 211 $ 251,866 Source(s): City of Fresno, Finance Department
218
CITY OF FRESNO, CALIFORNIA
Changes in Fund Balances, Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
(dollars in thousands)
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Revenues
Taxes $ 237,956 $ 263,470 $ 276,847 $ 266,521 $ 298,425 $ 289,140 $ 315,903 $ 330,423 $ 366,645 $ 452,241 Licenses and Permits 5,097 6,331 6,569 7,102 7,291 7,829 7,337 7,915 9,276 8,332 Intergovernmental 37,032 48,910 41,915 39,036 38,770 39,318 41,706 55,879 126,391 138,674 Charges for Services 49,995 46,277 44,692 46,398 49,538 51,294 57,413 53,493 64,462 66,961 Fines 4,193 3,746 3,392 4,271 3,487 3,872 3,643 3,315 1,792 2,726 Use of Money and Property 2,539 1,585 1,643 2,105 1,285 1,305 6,542 9,538 1,684 (7,050) Contributions and Donations — — — — — — — — — — Miscellaneous 6,146 5,612 8,800 8,156 36,448 4,504 3,640 2,017 3,125 8,436 Total Revenues 342,958 375,931 383,858 373,589 435,244 397,262 436,184 462,580 573,375 670,320 Expenditures
General Government 13,039 11,742 13,841 17,490 26,257 21,285 28,077 29,286 71,211 65,503 Public Protection 187,189 185,911 188,050 201,656 212,828 221,043 226,108 243,099 256,635 287,640 Public Ways and Facilities 33,332 39,190 35,607 38,293 42,430 41,682 50,561 53,686 63,186 73,443 Culture and Recreation 13,177 14,247 15,433 17,735 16,928 18,257 18,140 20,911 26,131 25,623 Community Development 25,685 23,666 30,320 29,511 29,360 31,483 30,961 32,970 39,983 57,344 Capital Outlays 19,919 28,375 38,984 23,145 29,990 31,401 26,168 27,605 54,776 75,441 Debt Service:
Principal 17,484 17,814 19,218 17,435 19,196 17,568 18,956 19,911 21,191 20,782 Interest 21,134 20,347 19,511 18,629 17,779 14,752 14,515 13,692 12,602 12,357 Total Expenditures 330,959 341,292 360,964 363,894 394,768 397,471 413,486 441,160 545,715 618,133 Excess (Deficiency) of Revenues
Over (Under) Expenditures 11,999 34,639 22,894 9,695 40,476 (209) 22,698 21,420 27,660 52,187 Other Financing Sources (Uses)
Transfers In 46,827 42,716 44,695 45,251 55,930 49,397 41,142 51,823 116,697 64,700 Transfers Out (66,633) (47,267) (50,573) (49,446) (59,055) (57,418) (46,110) (59,145) (128,855) (74,690) Discount on Debt Issued — — — — 835 — — — — — Issuance of Refunding Bonds — — — — 108,903 — — — — — Refunded Bond Redeemed — — — — (128,621) — — — — — Long-Term Debt Issued — — — — — — — — 17,145 — Premium on Debt Issued — — — — 11,528 — — — 2,773 — Capital Lease Financing — 621 966 7,331 4,126 3,162 2,228 9,026 83 — Proceeds for Capital Lease
Obligations 1,088 — — — — — — — — —
Sale of Capital Assets 1,346 8 785 609 2,046 223 2,382 — — — Total Other Financing Sources
(Uses) (17,372) (3,922) (4,127) 3,745 (4,308) (4,636) (358) 1,704 7,843 (9,990) Special Item
Loss on Receivable — — — — (8,152) — — — — —
Net Change in Fund Balances $ (5,373) $ 30,717 $ 18,767 $ 13,440 $ 36,168 $ (4,845) $ 22,340 $ 23,124 $ 35,503 $ 42,197 Debt Service as a Percentage of
Non-Capital Expenditures 12.35 % 12.45 % 11.94 % 11.00 % 10.29 % 9.11 % 8.83 % 8.16 % 6.55 % 6.27 % Source(s): City of Fresno, Finance Department
Note(s): To properly calculate the ratio of total debt service expenditures to non-capital expenditures, only governmental fund expenditures for the acquisition and construction of assets that are classified as capital assets for reporting in the Government-Wide Financial Statements have been subtracted from the total governmental fund expenditures. These figures by fiscal year are as follows: (2012) $15,973,001; (2013) $18,151,306; (2014) $34,893,624; (2015) $46,135,229; (2016) $35,295,704; (2017) $35,500,989; (2018) $42,738,629; (2019) $34,667,433; (2020) $29,289,000 and (2021) $29,973,000. 219
CITY OF FRESNO, CALIFORNIA
Gross Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years
Fiscal Year Secured Estimated
Actual
Unsecured
Estimated Actual
Total Taxable
Assessed Value
Total Direct Tax
Rate
Assessed Value as
a Percent of
Estimated Actual
Value
2013 $ 25,446,100,571 $ 1,511,385,533 $ 26,957,486,104 1.032438 100% 2014 26,754,005,601 1,449,421,705 28,203,427,306 1.032438 100 2015 28,638,669,937 1,444,805,569 30,083,475,506 1.032438 100 2016 30,026,361,027 1,500,061,596 31,526,422,623 1.032438 100 2017 31,344,820,623 1,596,315,117 32,941,135,740 1.032438 100 2018 32,837,504,668 1,616,397,886 34,453,902,554 1.032438 100 2019 34,713,392,408 1,899,808,202 36,613,200,610 1.032438 100 2020 36,659,070,484 1,899,510,831 38,558,581,315 1.032438 100 2021 38,644,667,812 2,225,286,118 40,869,953,930 1.032438 100 2022 40,198,896,767 2,181,351,026 42,380,247,793 1.032438 100 Fiscal Years
$ Dollars
Estimated Value of Taxable Property
SecuredUnsecured
2013201420152016201720152019202020212022
$0
$10,000,000,000
$20,000,000,000
$30,000,000,000
$40,000,000,000
Source(s): County of Fresno
Note(s): Fresno County does not collect Actual Value (Market Value) information on taxable properties or on tax exempt properties. The estimated actual value of taxable property is the same as the gross assessed value. 220
CITY OF FRESNO, CALIFORNIA
Direct and Overlapping Property Tax Rates
Last Ten Fiscal Years
(Percentage per $100 of Assessed Value)
Overlapping Rates
City Direct Rate Schools
Fiscal Year Property Tax
Rate
Fresno
Pension
Total Direct
Tax Rate
Fresno
Unified
School
District
State Center
Community
College
District
Total Direct
and
Overlapping
Property Tax
Rate
2013 1.0 0.032438 1.032438 0.188860 0.009358 1.230656 2014 1.0 0.032438 1.032438 0.188834 0.009602 1.230874 2015 1.0 0.032438 1.032438 0.188860 0.009308 1.230606 2016 1.0 0.032438 1.032438 0.188860 0.008064 1.229362 2017 1.0 0.032438 1.032438 0.188864 0.008480 1.229782 2018 1.0 0.032438 1.032438 0.188864 0.025934 1.247236 2019 1.0 0.032438 1.032438 0.188864 0.022966 1.244268 2020 1.0 0.032438 1.032438 0.178012 0.025786 1.236236 2021 1.0 0.032438 1.032438 0.188864 0.025786 1.247088 2022 1.0 0.032438 1.032438 0.213864 0.018088 1.264390 Source(s): County of Fresno
Note(s): On June 6, 1978, California voters approved a constitutional amendment to Article XIIIA of the California Constitution, commonly known as Proposition 13, which limits the taxing power of California public agencies. Legislation enacted by the California Legislature to implement Article XIIIA (Statutes of 1978, Chapter 292, as amended) provides that, notwithstanding any other law, local agencies may not levy any property tax except to pay debt service on indebtedness approved by voters prior to July 1, 1978, and that each county will levy the maximum tax permitted by Article XIIIA of $1.00 per $100.00 of full cash value. Assessed value is equal to full cash value, pursuant to Senate Bill 1656, Statutes of 1978.
221
CITY OF FRESNO, CALIFORNIA
Principal Property Taxpayers
Current Year and Nine Years Ago
2022 2013
Taxpayer Type of Business
Taxable
Assessed
Value
Rank
% of Total
County
Assessed
Value
Taxable
Assessed
Value
Rank
% of Total
County
Assessed
Value
River Park Properties Commercial,
Miscellaneous $ 175,887,278 1 0.42 % $ 142,041,335 1 0.53 % Gap Inc. Commercial 167,478,600 2 0.40 % 115,758,800 4 0.43 % Macerich Fresno Limited Partnership Commercial 147,314,193 3 0.35 % 132,334,400 2 0.49 % Meganova LP Apartments 145,406,430 4 0.34 % — — — % Gallo E & J Winery
Commercial, Unsecured 143,042,960 5 0.34 % 116,631,937 3 0.43 % Colony 2019 3 Bulk Industrial LLC
Commercial 100,583,357 6 0.24 % — — —
Comcast of Fresno Inc. No Secured Property 95,262,900 7 0.22 % 83,053,900 5 0.0031 Amazoncom Services Inc.
No Secured Property 84,989,400 8 0.20 % — — —
Foster Poultry Farms Industrial 74,725,472 9 0.18 % — — — % RPI Fig Garden LP Commercial 73,268,402 10 0.17 % — — — % Donahue Schriber Realty Group — — — 62,854,390 6 0.23 % M L Street Properties — — — 52,142,312 7 0.19 %
Capri Sun Inc. — — — 51,025,117 8 0.19 %
Zinkin De Wayne & Sandra — — — 50,723,447 9 0.19 %
Fresno Supreme Inc. — — — 49,755,354 10 0.18 %
Total $ 1,207,958,992 2.8600 % $ 856,320,992 3.1700 % Source(s): Avenu Insights & Analytics and California Municipal Statistics, Inc., as compiled by Willdan Financial Services.
Note(s): 2021/22 Taxable Assessed Valuation: $42,380,247,793 2012/13 Taxable Assessed Valuation: $26,957,486,104.
222
CITY OF FRESNO, CALIFORNIA
Property Tax Levies and Collections
Last Ten Fiscal Years
Current Tax Collections
Fiscal
Year
Total Net
Tax Levy
(Original
Levy)
Supplemental
Assessments
Redevelopment
Return of
Increment
Total
Adjusted
Tax Levy
Amount
Collected
Percentage
of Net Tax
Levy
Delinquent
Tax
Collections
Total Tax
Collections
Percent of
Collection
of Adjusted
Tax Levy
2013 $ 86,530,712 $ 10,098,582 $ 2,478,235 $ 99,107,529 $ 98,239,898 99.12 % $ 867,631 $ 99,107,529 100.00 % 2014 90,601,174 9,698,694 2,171,963 102,471,831 101,452,992 99.01 421,496 101,874,488 99.42 2015 96,468,363 11,900,327 1,609,109 109,977,799 106,989,456 97.28 395,578 107,385,034 97.64 2016 100,946,941 12,082,212 2,306,017 115,335,170 113,633,713 98.52 508,181 114,141,894 98.97 2017 105,199,432 13,077,130 2,014,329 120,290,891 119,336,199 99.21 386,236 119,722,435 99.53 2018 109,890,834 13,565,677 2,278,284 125,734,795 123,764,163 98.43 649,161 124,413,324 98.95 2019 116,141,387 14,916,496 2,786,268 133,844,151 132,157,601 98.74 543,876 132,701,477 99.15 2020 122,120,737 14,809,607 3,366,768 140,297,112 136,883,021 97.57 745,241 137,628,262 98.10 2021 128,697,400 17,130,950 5,378,795 151,207,145 144,896,990 95.83 1,443,494 146,340,484 96.78 2022 133,834,626 14,994,674 5,750,554 154,579,854 145,788,069 94.31 41,485 145,829,554 94.34 Average
Collections 98.29 %
Source(s): County of Fresno
Note(s):
Supplemental Assessments include voter approved indebtedness for Fire and Police Pensions and supplemental assessments added whenever new construction is completed and whenever real property changes ownership under Chapter 3.5 of Part 0.5 of Division 1 of the California Revenue and Taxation Code.
Beginning in fiscal year 2014, Delinquent Tax Collections do not include penalties and interest. Property tax collection for fiscal years prior to fiscal year 2014 have been adjusted so as not to exceed the levy.
Beginning in fiscal year 2014, collections only reflect those dollars that are related to the fiscal period in which the tax was levied. 223
CITY OF FRESNO, CALIFORNIA
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
(dollars in thousands, except per capita)
Governmental Activities Business-Type Activities
Fiscal
Year
General
Obligation
Bonds
Lease
Revenue
Bonds
Tax
Allocation
Bonds
Certificates
of
Participation
Notes
Payable
Capital
Leases
Airport
Revenue
Bonds
Solid
Waste
Revenue
Bonds
Sewer
Revenue
Bonds
Water
Revenue
Bonds
2013 $ 160,278 $ 180,456 $ — $ — $ 6,111 $ 6,718 $ 56,459 $ — $ 222,109 $ 156,274 2014 153,930 171,806 — — 5,283 7,738 56,138 — 215,611 152,785 2015 147,177 161,435 — — 4,569 10,113 54,590 — 207,280 147,569 2016 139,999 153,279 — — 3,813 17,220 53,098 — 198,436 142,148 2017 131,840 144,697 — — 3,016 20,884 51,508 — 189,134 136,569 2018 124,245 136,021 — — 2,466 28,271 49,825 — 179,351 130,774 2019 116,160 126,191 — — 2,033 39,338 83,039 — 34,943 124,759 2020 107,555 116,139 — — 1,846 43,121 81,145 — 6,934 118,501 2021 98,395 125,464 — — 1,648 41,153 78,383 — 885 90,241 2022 88,640 116,162 — — 1,440 52,568 75,459 — 885 90,329 Source(s): Debt Information - City of Fresno, Finance Department Population Information - State of California Department of Finance, Demographic Research Unit Note(s): See the Schedule of Demographic and Economic Statistics for personal income and population data on page 233.
Information pertaining to Personal Income is obtained from the Bureau of Economic Analysis (BEA).
Personal income and Per Capita Personal Income figures for fiscal year 2021 & 2022 are not currently available from the BEA.
The City is not obligated in any manner for the Special Assessment debt, but is acting as an agent for property owners in collecting the assessments and forwarding the collections to the trustee or paying agent and initiating foreclosure proceedings, if appropriate.
Beginning in fiscal year 2012, the Tax Allocation Bonds are no longer reported on this schedule, due to the dissolution of the Redevelopment Agency, effective February 1, 2012. The bonds are assumed by the Successor Agency. 224
CITY OF FRESNO, CALIFORNIA
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years (Continued)
(dollars in thousands, except per capita)
Business-Type Activities Primary Government
Fiscal
Year
Lease
Revenue
Bonds
Accreted
Interest
Certificates
of
Participation
Notes
Payable
Capital
Leases
Total
Primary
Government
Percentage
of Personal
Income
Net Debt per
Capita
2013 $ 87,675 $ — $ — $ 46,880 $ — $ 922,960 2.77 % $ 1,815 2014 84,106 — — 54,929 — 902,326 2.57 % 1,750
2015 79,908 — — 52,080 — 864,721 2.31 % 1,662
2016 75,465 — — 82,795 — 866,253 2.20 % 1,664
2017 69,492 — — 208,855 — 955,995 2.33 % 1,818
2018 61,242 — — 364,624 — 1,076,819 2.51 % 2,000 2019 55,832 — — 403,612 — 985,907 2.17 % 1,837
2020 50,211 3,595 — 407,096 — 936,143 1.93 % 1,715 2021 44,362 3,355 — 424,550 — 908,436 1.74 % 1,661 2022 38,270 0 — 425,341 — 889,094 N/A 1,635
225
CITY OF FRESNO, CALIFORNIA
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years
General Bonded Debt
Outstanding
Fiscal Year General Bonded
Debt
Tax Allocation
Bonds Total
Percent of
Actual Taxable
Value of
Property
Population Net Debt per
Capita
2013 $ 160,277,894 $ — $ 160,277,894 0.595 % 508,453 $ 315 2014 153,930,355 — 153,930,355 0.546 % 515,609 299 2015 147,177,000 — 147,177,000 0.489 % 520,159 283 2016 139,998,791 — 139,998,791 0.444 % 520,453 269 2017 131,840,000 — 131,840,000 0.400 % 525,832 251 2018 124,245,000 — 124,245,000 0.361 % 538,330 231 2019 116,160,000 — 116,160,000 0.317 % 536,683 216 2020 107,555,000 — 107,555,000 0.279 % 545,769 197 2021 98,395,000 — 98,395,000 0.241 % 546,770 180
2022 88,640,000 — 88,640,000 0.209 % 543,660 163
Source(s): General Bonded Debt Information - City of Fresno Department of Finance Population Information - State of California Department of Finance, Demographic Research Unit Note(s): Details regarding the City's outstanding debt can be found in the notes to the basic financial statements.
See Gross Assessed Value and Estimated Actual Value of Taxable Property schedule for property value information on page 220.
Beginning in fiscal year 2012, the Tax Allocation Bonds are no longer reported on this schedule, due to the dissolution of the Redevelopment Agency, effective February 1, 2012. The bonds were assumed by the Successor Agency. 226
CITY OF FRESNO, CALIFORNIA
Direct and Overlapping Governmental Activities Debt
As of January 10, 2022
2021-22 Gross Assessed Valuation: $42,380,247,793
Estimated
Percent
Applicable
Debt
Applicable
Combined Direct Debt
City of Fresno Pension Obligation 100% $ 88,640,000
Lease Revenue Bonds 100 116,162
Notes Payable 100 1,440
Capital Leases 100 52,568
Total Combined Direct Debt 88,810,170
Overlapping Tax, and Assessment Debt
City of Fresno Community Facilities District No. 4 100% $ 815,000 City of Fresno Community Facilities District No. 5 100 690,000 City of Fresno Community Facilities District No. 7 100 1,220,000 State Center Community College District 42.443 135,970,395 Clovis Unified School District 47.921 173,661,370
Fresno Unified School District 84.495 631,424,048
Central Unified School District 81.471 194,740,296
Other School Districts Various 79,190,507
California Statewide Communities Development Authority Community Facilities District No. 2012-01 100 4,050,000 Total Overlapping Tax, and Assessment Debt 1,221,761,616 Overlapping General Fund Obligation Debt
Fresno County Pension Obligations 46.526% $ 94,692,269
Fresno County General Fund Obligations 46.526 12,648,093 Clovis Unified School District Certificates of Participation 47.921 57,795,122 Fresno Unified School District Certificates of Participation 84.495 5,289,387 Central Unified School District Certificates of Participation 81.471 22,691,196 Other School District Certificates of Participation Various 13,416,045 Total Overlapping General Fund Debt 206,532,112
Overlapping Tax Increment Debt (Successor Agency)
Fresno Redevelopment Mariposa Medical Project Area 100% $ 1,185,000 Total Overlapping Tax Increment Debt 1,185,000
Total Overlapping Tax and Assessment, General Fund and Tax Increment Debt 1,429,478,728 Total Overlapping and Direct Debt $ 1,518,288,898
Ratios to 2021-22 Assessed Valuation:
Combined Direct Debt 0.210 %
Overlapping Tax, and Assessment Debt 2.883 %
Combined Total Overlapping and Direct Debt 3.580 %
Overlapping Tax Increment Debt (Successor Agency) 0.003 % Note(s): Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the City of Fresno. This process recognizes that, when considering the City's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account.
The percentage of overlapping debt applicable to the City of Fresno is estimated using taxable assessed property value. Applicable percentages were estimated by determining the portion of overlapping district's taxable assessed value that is within the boundaries of the City of Fresno divided by the District's total taxable assessed value.
The Direct and Overlapping Governmental Activities Debt excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds and non-bonded capital lease obligations. Qualified Zone Academy Bonds are included based on principal due at maturity.
The Overlapping Tax, Assessment Debt and General Fund Debt percentages and figures are provided by Cal Municipal Services, Inc. and are as of January 10, 2022. Direct Debt figures are provided by the Finance Department at the City of Fresno and are as of June 30, 2022. 227
CITY OF FRESNO, CALIFORNIA
Debt Coverage Ratio - Airports
Last Ten Fiscal Years (in thousands)
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Revenues (1) (2) $ 19,876 $ 21,216 $ 21,802 $ 22,976 $ 24,500 $ 25,022 $ 27,308 $ 26,789 $ 33,470 $ 41,093 Less Operating Expenses (3) 14,322 14,262 14,428 14,934 16,117 17,355 18,701 19,962 20,626 21,290 Plus: Other Available Funds (4) 51 95 350 359 368 377 386 395 — 416 Net Revenues $ 5,605 $ 7,049 $ 7,724 $ 8,401 $ 8,751 $ 8,044 $ 8,993 $ 7,222 $ 12,844 $ 20,219 Adjusted Debt Service
Series 2000 Bonds $ 3,012 $ — $ — $ — $ — $ — $ — $ — $ — $ — Series 2013 Bonds (5) — 3,288,000 2,805 2,808 2,803 2,801 2,802 2,801 — 2,804 Less
Minimum PFC Contribution (6) (1,100) (1,600) (1,600) (1,600) (1,600) (1,600) (1,600) (1,600) (1,600) (1,600) Additional PFC Contribution (500) (231) — (200) — — — — — — Net Series 2000/2013 Debt Service $ 1,412 $ 1,457 $ 1,205 $ 1,008 $ 1,203 $ 1,201 $ 1,202 $ 1,201 $ (1,600) $ 1,204 Series 2007 Bonds (5) 1,332 1,369 1,399 1,437 1,472 1,509 1,544 1,581 — 1,664 2019 Bonds (5) — — — — — — — — 2,141 —
Annual Adjusted Debt Service (7) $ 2,744 $ 2,826 $ 2,604 $ 2,445 $ 2,675 $ 2,710 $ 2,746 $ 2,782 $ 541 $ — Annual Adjusted Debt Service Coverage (8) 2.02 2.46 2.83 3.44 3.27 2.97 3.27 2.60 23.74 7.05 Note(s):
(1) State of California law requires the exclusion of Customer Facility Charge (CFC) Revenues from the calculation of Debt Service coverage in excess of annual Debt Service on the Series 2007 Bonds. (2) Fiscal year 2021 Revenues include $7.7 million of CARES Act monies. The Indenture of Trust defines Federal operating grants as Revenues. (3) For all fiscal years, reflects Operating Expenses in operating funds only and does not include costs expensed out of Airports capital funds, such as Federal grant-funded Master Plan in fiscal year 2018 and fiscal year 2019.
(4) Per the Indenture, unencumbered funds equal to 25% of Adjusted Debt Service may be designated by the City as Other Available Funds prior to the beginning of any fiscal year, and transferred to the Revenue Fund at the beginning of such fiscal year. Since fiscal year 2015, the City's policy has been to annually designate available CFC funds equal to 25 percent of debt service associated with 2007 Bonds as Other Available Funds.
(5) Fiscal year 2021 Debt Service associated with Series 2013 Bonds, Series 2007 Bonds, and 2019 Bonds was prepaid on September 2020 with existing cash balances. (6) Under the Supplemental Indenture that authorized the 2013 Bonds, the Minimum Passenger Facility Charge (PFC) Contribution was increased from $1.1 million to $1.6 million. (7) Fiscal year 2021 Adjusted Debt Service was prepaid with existing cash balances (and was not paid with fiscal year 2021 Net Revenues). (8) Had fiscal year 2021 Adjusted Debt Service not been prepaid, fiscal year 2021 Debt Service coverage would have been 2.77. 228
CITY OF FRESNO, CALIFORNIA
Debt Coverage Ratio - Water System
Last Ten Fiscal Years (in thousands)
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Revenues
Charges for Services and Other Operating Revenue $ 71,667 $ 90,096 $ 74,285 $ 77,959 $ 101,895 $ 107,377 $ 119,029 $ 120,252 $ 127,651 $ 138,341 Less: Connection Fee Charges for Services (1,331) (1,667) (1,496) (1,563) (1,917) (2,531) (2,138) (2,596) (1,835) (1,641) Net Charges for Services (1) 70,336 88,429 72,789 76,396 99,978 104,846 116,891 117,656 125,816 136,700 Other Operating Revenues and Interest Income 720 329 573 1,147 17 (238) 4,974 6,906 (627) (9,378) Total Revenues 71,056 88,758 73,362 77,543 99,995 104,608 121,865 124,562 125,189 127,322 Operating Expenses
Labor and Benefits 12,679 13,525 11,378 12,437 12,401 12,176 14,581 13,075 15,428 15,171 Pumping Power 9,113 9,292 8,501 8,150 9,064 9,550 8,358 9,419 10,252 11,516 Source of Supply 6,318 1,780 5,613 6,630 4,188 9,751 6,536 9,027 6,531 8,699 All Other Operating and Maintenance (2) 16,821 18,151 17,473 17,166 21,547 17,692 35,143 26,148 24,728 31,266 Total Operating Expenses (3) 44,931 42,748 42,965 44,383 47,200 49,169 64,618 57,669 56,939 66,652 Net Current Revenue $ 26,125 $ 46,010 $ 30,397 $ 33,160 $ 52,795 $ 55,439 $ 57,247 $ 66,893 $ 68,250 $ 60,670 Senior Bond Debt Service (4) $ 1,376 $ 1,378 $ 1,374 $ 1,381 $ 1,380 $ 1,376 $ 1,379 $ 1,379 $ — $ — State Loans Debt Service (5) 259 120 120 120 — — — — — — Total Senior Debt Service 1,635 1,498 1,494 1,501 1,380 1,376 1,379 1,379 — — Senior Coverage Ratio 15.98 30.71 20.35 22.09 38.26 40.29 41.51 48.51 Not Applicable Not Applicable Net Revenue Available for Parity Debt Service $ 24,490 $ 44,512 $ 28,903 $ 31,659 $ 51,415 $ 54,063 $ 55,868 $ 65,514 $ 68,250 $ 60,670 2010 Series A Bond Debt Service (6) $ 12,507 $ 12,509 $ 12,509 $ 12,531 $ 12,508 $ 12,509 $ 12,504 $ 12,510 $ 7,020 $ 6,097 State Loans Debt Service (5) 338 338 2,770 2,786 3,533 6,021 10,937 18,562 16,190 16,489 Total Parity Debt Service $ 12,845 $ 12,847 $ 15,279 $ 15,317 $ 16,041 $ 18,530 $ 23,441 $ 31,072 $ 23,210 $ 22,586 Parity Coverage Ratio 1.96 3.46 1.89 2.07 3.21 2.92 2.38 2.11 2.94 2.69 Note(s): (1) 1993 Indenture defines "Current Revenues" as all revenue from the operation of the Water System except for connection fees and charges. (2) All other operating and Maintenance includes Fleet Depreciation Charge (vehicle replacement fees paid to the Fleet Department). (3) 1993 Indenture defines "Maintenance and Operation Costs" as all costs incurred for maintaining and operating the Water System except for Debt Service, Depreciation and Amortization. (4) 2003 Water Bonds were the only remaining Senior Bond Debt Service after FY 2016, and were paid off in fiscal year 2020. (5) Paid off remaining 2010 Series A-1 Bonds in fiscal year 2021 with surplus cash. 229
CITY OF FRESNO, CALIFORNIA
Debt Coverage Ratio - Sewer System
Last Ten Fiscal Years (in thousands)
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Charges for Services (1) $ 76,324 $ 76,201 $ 81,955 $ 78,186 $ 83,635 $ 81,651 $ 81,085 $ 77,249 $ 77,940 $ 87,795 Interest Income 485 1,547 1,787 2,779 492 2,046 5,548 4,702 (720) (7,943) Less: Wastewater Facility Connection Fee (1,853) (1,981) (1,709) (1,844) (1,968) (1,996) (3,290) (2,600) (3,426) (3,393) Total Senior Lien Revenues 74,956 75,767 82,033 79,121 82,159 81,701 83,343 79,351 73,794 76,459 Operating Expenses (2) 36,431 36,339 37,391 35,935 38,058 37,237 45,835 43,522 44,630 51,088 Net Income Before Debt Service $ 38,525 $ 39,428 $ 44,642 $ 43,186 $ 44,101 $ 44,464 $ 37,508 $ 35,829 $ 29,164 $ 25,371 Senior Lien Debt Service (3) 10,724 10,714 10,695 10,387 10,712 10,701 10,684 373 6,234 40 Coverage Ratio (4) 3.59 3.68 4.17 4.16 4.12 4.16 3.51 96.06 4.68 634.28 100% Coverage-Subordinate Lien:
Net Current Revenue after Senior Lien Debt (before Connection Fees) $ 27,801 $ 28,714 $ 33,947 $ 32,799 $ 33,389 $ 33,763 $ 26,824 $ 35,456 $ 22,930 $ 25,331 Available from Senior Lien Revenues $ 27,802 $ 28,714 $ 33,947 $ 32,799 $ 33,389 $ 33,763 $ 26,824 $ 35,456 $ 22,930 $ 25,331 Subordinate Lien Debt Service (5) $ 7,949 $ 7,949 $ 7,949 $ 7,949 $ 7,949 $ 7,949 $ 667 $ 2,280 $ — $ — State Loan Debt Service (6) — — — — — 1,280 1,286 2,573 1,286 1,286 Coverage Ratio 3.50 3.61 4.27 4.13 4.20 4.25 40.22 15.55 17.83 19.70 120% & 125% Coverage Subordinate Lien:
Net Current Revenue (Excluding Connection Fees) $ 27,802 $ 28,714 $ 33,947 $ 32,799 $ 33,389 $ 33,763 $ 26,824 $ 35,456 $ 22,930 $ 25,331 Wastewater Facility Connection Fee 1,853 1,981 1,709 1,844 1,968 1,996 3,290 2,600 3,426 3,393 Transfers From/To Rate Stabilization Fund — — — — — — — — — — Net Current Revenue (Including Connection Fees) $ 29,655 $ 30,695 $ 35,656 $ 34,643 $ 35,357 $ 35,759 $ 30,114 $ 38,056 $ 26,356 $ 28,724 Available From Senior Lien Revenues $ 29,655 $ 30,695 $ 35,656 $ 34,643 $ 35,357 $ 35,759 $ 30,114 $ 38,056 $ 26,356 $ 28,724 Subordinate Lien Debt Service (5) $ 7,949 $ 7,949 $ 7,949 $ 7,949 $ 7,949 $ 7,949 $ 7,949 $ 7,949 $ — $ — State Loan Debt Service (6) — — — — — 1,280 1,286 2,573 1,286 1,286 Coverage Ratio 3.73 3.86 4.49 4.36 4.45 3.87 3.26 3.62 20.49 22.34 Net Income After Debt Service (7) $ 21,706 $ 22,746 $ 27,707 $ 26,694 $ 27,408 $ 26,530 $ 20,879 $ 27,534 $ 25,070 $ 27,438 Note(s):
(1) Includes revenue paid by the City of Clovis for Operations & Maintenance pursuant to the 1977 Fresno-Clovis Sewerage System Joint Powers Agreement. (2) The 1993 Indenture specifically excludes from Operating Expenditures: Debt Service, Amortization and Depreciation. (3) 1993 Sewer System Revenue Bonds, Series A
(4) Coverage Ratio is calculated by dividing Net Income before Debt Service by Senior Lien Debt Service. (5) 2008 Sewer System Revenue Refunding Bonds, Series A. (6) State Loan Debt Service
(7) Net Income after Debt Service and before cash financed capital expenditures and any other expenditures for lawful purposes. 230
CITY OF FRESNO, CALIFORNIA
Pledged Revenue Coverage - GASB 44 Methodology
Last Ten Fiscal Years (in thousands)
Fresno Convention Center Revenue Bonds
Debt Service
Fiscal
Year
Charges for
Services
Less: Operating
Expenses
Net Available
Revenue Principal Interest Coverage
2013 $ 2,594 $ 3,836 $ (1,242) $ 3,308 $ 2,708 (0.21)
2014 2,626 3,710 (1,084) 2,799 2,586 (0.20)
2015 2,960 3,844 (884) 2,904 2,469 (0.16)
2016 3,634 4,929 (1,295) 3,030 2,346 (0.24)
2017 3,752 4,929 (1,177) 22,762 2,213 (0.05)
2018 3,318 3,958 (640) 2,189 1,171 (0.19)
2019 3,796 4,350 (554) 3,260 1,882 (0.11)
2020 1,911 3,528 (1,617) 3,422 1,716 (0.31)
2021 (2) 1,719 (1,721) 3,596 1,541 (0.34)
2022 5,744 6,387 (643) 3,784 1,351 (0.13)
Stadium Bonds
Debt Service
Fiscal
Year
Charges for
Services
Less: Operating
Expenses
Net Available
Revenue Principal Interest Coverage
2013 $ 1,089 $ 9 $ 1,080 $ 1,120 $ 2,322 0.31
2014 798 30 768 1,185 2,260 0.22
2015 1,248 31 1,217 1,255 2,189 0.35
2016 677 224 453 1,335 2,114 0.13
2017 1,082 224 858 17,210 1,597 0.05
2018 2,488 90 2,398 1,355 1,714 0.78
2019 406 111 295 1,490 1,705 0.09
2020 644 51 593 1,575 1,616 0.19
2021 580 154 426 1,670 1,522 0.13
2022 279 426 (147) 1,770 1,422 (0.05)
Park Bonds
Debt Service
Fiscal
Year
Charges for
Services
Less: Operating
Expenses
Net Available
Revenue Principal Interest Coverage
2013 $ 736 $ 416 $ 320 $ 50 $ 106 2.06
2014 329 82 247 50 104 1.61
2015 329 65 264 55 102 1.68
2016 325 102 223 55 100 1.44
2017 340 102 238 2,030 98 0.11
2018 323 38 285 60 73 2.15
2019 410 256 154 50 79 1.19
2020 278 345 (67) 55 77 (0.51)
2021 411 326 85 55 74 0.66
2022 630 170 460 55 71 3.65
Note(s) Operating Expenses do not include interest, amortization or depreciation expenses.
The City issued new lease-revenue bonds to refinance several existing lease-revenue bonds for economic savings on May 10, 2017. Any bonds that were callable and produced savings were included, even if it meant redeeming one project in part because there was a non-callable portion that could not be redeemed. 231
CITY OF FRESNO, CALIFORNIA
Legal Debt Margin Information
Last Ten Fiscal Years
(Dollars in Thousands)
Legal Debt Limit Calculation for
Fiscal Year 2022
Assessed Value $ 42,380,248
Debt Limit (20% of assessed
value, pursuant to City Charter) 8,476,050
Debt applicable to the limit:
General obligation bonds — Less amount set aside for
repayment of general obligation
debt —
Total net debt applicable to limit —
Legal debt margin $ 8,476,050
Fiscal Year Debt Limit
Total Net Debt
Applicable to
Limit
Legal
Debt Margin
Total Net Debt
Applicable to the
Limit as a
Percentage of
Debt Limit
2013 $ 5,391,497 $ — $ 5,391,497 0.00 %
2014 5,640,685 — 5,640,685 0.00
2015 6,016,695 — 6,016,695 0.00
2016 6,305,285 — 6,305,285 0.00
2017 6,588,227 — 6,588,227 0.00
2018 6,890,781 — 6,890,781 0.00
2019 7,322,640 — 7,322,640 0.00
2020 7,711,716 — 7,711,716 0.00
2021 8,173,990 — 8,173,990 0.00
2022 8,476,049 — 8,476,049 0.00
Source(s): Assessed Valuation Information - County of Fresno, Tax Rate Book Note(s): The City's Judgment and Pension obligation bonds were the result of legal judgments that were financed to be paid out over a period of time.
Per Article XVI, Section 18 of the California Constitution "obligations imposed by law" are deemed exceptions to the debt limit. 232
CITY OF FRESNO, CALIFORNIA
Demographic and Economic Statistics
Last Ten Calendar Years
Calendar Year Population Personal Income
Per Capita
Personal
Income
Unemployment Rate Area Square
Miles
2013 508,453 $ 33,354,677,000 $ 34,886 13.250% 113.13
2014 515,609 35,172,162,000 36,448 11.580% 113.13
2015 520,159 37,359,815,000 38,323 10.200% 114.20
2016 520,453 39,295,335,000 40,101 9.500% 114.34
2017 525,832 41,024,000,000 41,470 8.480% 114.67
2018 538,330 42,842,800,000 43,084 7.500% 115.21
2019 536,683 45,445,944,000 45,487 7.300% 116.48
2020 545,769 48,539,267,000 48,495 12.124% 116.48
2021 546,770 52,120,107,000 51,422 12.131% 116.93
2022 543,660 Not yet available Not yet available 5.600% 116.93 Source(s): Population Information - State of California Department of Finance, Demographic Research Unit Unemployment Information - California Employment Development Department (EDD), Labor Market Information Division
Per Capita Income and Personal Income - Bureau of Economic Analysis (BEA).
Note(s): Personal Income and Per Capita Personal Income information pertains to Fresno, CA, Metropolitan Statistical Area (MSA). 2020-2022 Personal Income and Per Capita Income data is not yet available from the BEA.
The 2022 Unemployment Rate is the average of estimates for the first 8 months of calendar year 2022 as provided by California Employment Development Department as of October 2022.
The 2022 Population is as of 1/1/2022.
233
CITY OF FRESNO, CALIFORNIA
Principal Employers
Current Year and Nine Years Ago
2022 2013
Employer
Employees Rank
Percent of
Total City
Employment
Employees Rank
Percent of Total
City
Employment
Fresno Unified School District 13,669 1 3.55% — — —
Community Medical Centers 9,000 2 2.34% 3,589 2 1.83%
County of Fresno 8,870 3 2.30% 6,064 1 3.10%
Amazon 6,500 4 1.69% — — —
Clovis Unified School District 6,400 5 1.66% — — —
City of Fresno 4,605 6 1.20% 3,100 3 1.58%
Internal Revenue Service 4,230 7 1.10% — — —%
Foster Farms 3,063 8 0.80% — — —%
Valley Children's 3,000 9 0.78% — — —%
Saint Agnes Medical Center 2,900 10 0.75% 1,906 4 0.97% California State University, Fresno — — — 1,525 5 0.78% Kaiser Permanente Medical Center — — — 1,012 7 0.52%
Lyons Magnus — — — 600 8 0.31%
Guarantee Real Estate — — — 455 9 0.23%
Total 62,237 16.17% 19,628 10.03%
Fresno City Employment 384,900 195,800
Source(s): Employer Information - Fresno County Economic Development Corporation (EDC) City of Fresno Employment information - Employment Development Department (EDD) - Labor Market Information, State of California Note(s): Fiscal year 2022 employer information provided by the Fresno County Economic Development Corporation (EDD) and represents private and public sector full- time employees.
The fiscal year 2022 employer information for the County of Fresno is estimated to be within the City of Fresno.
The Employer Information for the Internal Revenue Service includes employees from all Fresno offices.
Fiscal year 2022 Fresno City Employment figures are for June 2022 as currently available from the California EDD for Fresno (MSA). 234
CITY OF FRESNO, CALIFORNIA
Full-Time Equivalent City Government Employees by Function/Program Last Ten Fiscal Years
Fiscal Year
General Government 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Management 78.80 79.50 79.50 80.25 85.25 96.84 101.50 189.00 199.00 226.25 Finance 56.00 56.00 58.00 58.75 60.75 54.75 55.00 118.00 116.00 115.75 Other 89.75 94.80 95.00 96.25 103.50 106.00 112.00 117.00 121.00 130.00 Enterprise Functions
Transportation
Airports
Sworn 5.00 5.00 15.00 15.00 19.00 19.00 19.00 19.00 19.00 21.00 Civilian 72.30 77.40 72.00 72.00 77.35 80.05 82.00 85.65 99.40 95.40 FAX Department 407.00 407.00 422.00 435.50 492.25 508.00 515.50 533.00 534.00 541.00 Public Utilities 602.25 614.75 634.75 640.50 643.80 643.80 646.80 587.75 589.00 613.50 Economic Growth and Expansion
Development and Resource
Management Department 163.10 166.60 174.60 184.60 204.80 218.70 — — — Planning and Development Services — — — — — — 218.20 138.70 141.20 161.35 Public Works 268.00 272.50 292.75 288.75 305.25 315.25 339.50 356.75 358.00 392.50 Culture and Recreation
Parks, Recreation and Community
Services 52.00 52.00 66.00 71.00 73.50 75.00 75.75 76.00 88.00 72.00 Public Protection
Police
Sworn 748.00 717.00 717.00 775.00 804.00 830.00 835.00 835.00 838.00 850.00 Civilian 202.00 238.00 278.80 244.56 274.65 270.34 273.75 292.00 297.60 316.90 Fire
Sworn 309.00 304.00 310.00 314.00 334.00 334.00 334.00 302.00 305.00 347.00 Civilian 42.75 42.20 46.75 45.00 42.91 47.75 42.50 43.50 45.30 48.50 Total 3,095.95 3,126.75 3,262.15 3,321.16 3,521.01 3,599.48 3,650.50 3,693.35 3,750.50 3,931.15 Source(s): City of Fresno Budget Management & Studies Division - Adopted Budgets, Authorized Positions.
Note(s): Figures for Full-Time Equivalents (FTE's) include Permanent and Permanent Part-Time employees only.
Authorized Positions are established by resolution of the City Council and represent the total number of permanent, permanent part-time and permanent intermittent positions in which persons may be employed by the City during a Fiscal Year. Changes in the total number of positions can only be accomplished by resolution of the City Council.
Total permanent positions for each fiscal year are represented as of the following dates: fiscal year 2012 as of May 2012; fiscal year 2013 as of September 2012; fiscal year 2014 as of June 2013; fiscal year 2015 as of September 2014; fiscal year 2016 as of September 2015; fiscal year 2017 as of June 2017; fiscal year 2018 as of June 2018; fiscal year 2019 as of June 2019; fiscal year 2020 as of June 2020 and fiscal year 2021 as of June 2021.
In fiscal year 2017, the Transportation FAX Department added service, management and support staff positions for a variety of service additions such as Bus Rapid Transit (BRT), extended night and weekend service, and increased frequencies on four major avenues.
In fiscal year 2017, positions were added to address reductions that occurred in recent years. Additions to the Police Department included Police Officer Recruits, Police Officer Cadets and a Police Sergeant. Additions to the Fire Department included Firefighters and an administrative position.
In fiscal year 2018, the Budget and Management Studies Division was relocated from the Finance Department to the City Manager's Office.
In fiscal year 2019, Development and Resource Management Department (DARM) became Planning & Development Services. 235
CITY OF FRESNO, CALIFORNIA
Operating Indicators by Function/Program
Last Ten Fiscal Years
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
General Government
Building Permits Issued
Commercial 1,756 1,835 1,878 1,641 1,948 1,876 1,688 1,731 1,387 1,322 Residential 7,167 7,931 9,084 8,313 11,227 10,998 7,770 9,753 9,045 9,458 Police
Physical Arrests 35,489 39,689 43,729 37,816 26,893 27,920 28,337 20,885 18,006 10,939 Traffic Violations (citations issued) 53,485 51,940 44,954 58,927 58,927 39,488 57,691 43,992 21,769 22,892 Calls Received for Police Service 945,989 957,532 950,099 1,026,458 950,099 1,013,411 924,016 920,020 905,206 1,256,230 Fire
Emergency Medical Service Calls 18,129 19,413 20,191 19,174 21,773 21,430 32,071 27,964 21,640 25,487 Fire Incidents 14,518 15,953 16,326 18,257 16,702 16,830 25,194 14,906 19,352 22,281 Fire Inspections 12,414 11,187 9,780 12,581 13,292 12,679 12,747 13,692 11,329 14,871 Fire Hydrant Inspections 30,342 30,420 26,811 17,025 17,000 17,252 17,252 17,381 17,859 17,004 Wastewater Treatment
Average Daily Sewage Treatment
(million gallons per day) 61.9 60.2 57.2 55.9 56.9 57.1 56.2 56.1 58 57.38 Wastewater Treatment Capacity (million
gallons per day) 80 80 80 80 80 80 92 91.5 91.5 94.5
Solid Waste
Refuse Collected (tons per day) 477 451 505 623 650 648 662 650 750 750 Recyclables Collected (tons per day) 147 116 117 154 156 154 156 159 179 180 Green Waste Collected (tons per day) 378 293 275 348 358 353 365 366 368 359 Other Public Works
Street Resurfacing (miles) 10.2 12.3 17.0 18.6 16.8 15.1 28.3 13.8 91.4 13.1 Parking Violations (citations issued) 45,730 49,313 49,326 47,531 53,760 54,865 45,407 34,514 16,524 29,251 Parks and Recreation
Athletic Field Permits Issued 3,281 4,317 5,921 6,949 8,332 5,392 6,795 5,182 556 2,967 Memorial Auditorium User Groups 20 26 16 27 18 13 23 8 1 8 Memorial Auditorium, Audience 15,500 21,600 21,000 45,900 18,900 16,500 19,500 10,800 1,106 5,225 Senior Hot Meal Participants (All Sites) 40,788 38,874 38,103 45,070 44,686 47,605 46,604 29,007 — — Meals Served (Not Senior Hot Meals) — — — — 32,328 40,830 26,879 22,878 — — Picnic Shelter/Table Reservations
(Roeding & Woodward) 2,754 3,058 2,194 2,457 2,053 1,907 1,841 2,438 21 4,838 Average Daily Attendance (Neighborhood
Parks with Centers) — — — 1,653 1,732 1,976 2,083 1,656 357 20 236
CITY OF FRESNO, CALIFORNIA
Operating Indicators by Function/Program
Last Ten Fiscal Years (Continued)
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Convention Center
Event Days 360 322 297 209 313 300 296 170 — 155 Gross Ticket Sales $ 4,987,646 $ 7,905,120 $ 5,594,470 $ 7,272,305 $ 8,049,133 $ 6,741,116 $ 12,048,880 $ 3,792,771 $ — $ 8,537,274 Attendance 553,443 442,070 428,086 455,491 455,587 417,918 478,541 278,299 — 234,718 Water
Number On-Service Accounts 130,530 131,910 133,163 134,381 135,448 136,408 137,251 138,332 140,140 141,196 Main/Service Leaks Repaired 639 705 558 378 408 663 737 776 842 541 Average Daily Per Capita Consumption (gallons) 241 231 208 183 198 208 189 197 203 198 Peak Daily Consumption (MGD - Million Gallons per
Day) 200.46 199.4 187.36 169.88 180.6 183.42 156.91 170.01 174.2 172.44 Transportation
Airports
Number of Commercial Airlines 10 10 9 8 8 8 8 8 9 9
Number of Cargo Carriers 3 3 3 3 3 3 3 3 3 2
Total Number Tenant Aircraft 405 408 408 320 303 277 301 287 287 287 Annual Fuel Consumption (gallons) 9,613,371 10,454,758 9,548,919 10,541,916 10,592,430 8,698,431 2,648,061 2,002,465 2,247,020 2,549,932 Origin and Destination Passengers
Domestic 1,249,960 1,283,770 1,252,962 1,292,784 1,328,929 1,423,248 1,621,990 1,298,554 1,094,020 1,907,434 International 124,453 147,094 153,244 182,225 208,947 212,075 235,667 207,037 200,785 302,571 Origin and Destination Mail (lbs.) 6,661 183 — 316 17,818 9,362 12,649 — — — Origin and Destination Freight (lbs.) 23,621,976 24,393,421 25,843,389 24,546,856 19,873,695 20,965,016 22,399,354 34,921,956 33,956,904 34,348,311 Fresno Area Express (FAX)
Actual Route Miles 4,151,476 4,218,412 4,157,174 4,175,783 4,208,890 4,337,684 4,649,397 4,701,969 4,693,498 4,788,756 Passengers 12,442,248 12,059,050 11,364,431 10,672,577 9,622,874 9,750,800 10,551,665 9,058,367 5,604,780 6,985,740 Mini-Buses - Purchased Transportation 44 48 50 58 63 69 56 48 43 40 Source(s): City of Fresno - Various Departments
Note(s): Building Permits Issued includes individual units and structures and is a composite of new construction, additions, alterations, repairs and relocations.
Police department figures are based on calendar year and are as of January 1 of reported year. FY2020 physical arrest figures are reported as of September 2019.
Information is combined for Fresno Yosemite International (FYI) and Chandler Executive Airport (FCH) for Number of Cargo Carriers, Number of Tenant Aircraft, Annual Fuel Consumption and Origin and Destination Freight.
Fire inspection figures reflect only those performed in the City of Fresno and excludes service calls for neighboring fire districts.
Fire hydrant inspections decreased in FY2016 because of an inspection schedule change. Beginning in FY2016, fire hydrant inspections are scheduled for annual inspections instead of bi-annual inspections.
The FY2016 Mini bus figure includes 8 sedans as is consistent with National Transit Database (NTD) reporting.
The FY2019 increase in FAX functional areas was due to a steady increase in FAX ridership due to strategic planning efforts, namely the addition of Bus Rapid Transit service in February 2018 and an additional line (Route 12) west of highway 99.
The FY2019 drop in fuel consumption was due to a loss of a large fixed based operator and a significant drop in the extent of fires, resulting in less military and forest service.
The FY2020 & FY2021 reduction in parking violations was related to relaxed enforcement due to COVID-19.
The FY2021 decrease in number of mini-buses was due to life cycle retirements. Passenger decrease was a direct result of COVID-19, ridership was restricted to allow for social distancing. Beginning March 2020, the passenger limit affected subsequent months and continued through June 20, 2021.
The FY2021 reduction of Parks & Recreation operations was due to the shuttering of facilities due to COVID-19.
The FY2021 increase in street resurfacing miles was due to the inclusion of Street Paving, Slurry & Construction Management miles.
The FY2021 decrease of Convention Center operations was due to the reduction of events hosted in response to COVID-19.
The FY2021 decrease in Police traffic violations was due to less people on the roads in response to COVID-19 The FY2022 increase of Convention Center operations was due to the increase of events hosted.
Information was not available for all years for all categories. 237
CITY OF FRESNO, CALIFORNIA
Capital Asset Statistics by Function/Program
Last Ten Fiscal Years
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Police Department
Stations 4 4 4 4 5 5 5 5 5 5
Patrol Bureaus 4 4 4 4 5 5 5 5 5 5
Vehicular Patrol Units 261 261 257 276 334 360 356 390 388 435 Plain Cars (No specialty vehicles) 197 175 175 173 198 197 200 228 239 64 Motorcycles 70 71 85 72 70 74 70 66 74 57
Helicopters 2 2 2 2 2 2 2 2 2 2
Fixed Wing Aircraft 1 1 1 1 1 1 — — — —
Fire Department
Fire Stations 20 20 20 20 20 20 20 20 20 20
Squad Companies — — — — — — — — — 3
Engine Companies 16 16 18 18 17 17 18 18 18 18
Truck Companies 4 4 4 4 5 5 5 5 5 5
Public Works
Streets (miles) 1,497 1,490 1,672 1,500 1,511 1,692 1,700 1,714 1,721 1,721 Street Lights 41,556 41,500 42,051 42,207 42,405 43,318 43,450 43,570 43,811 44,048 Traffic Signals 468 466 489 467 468 481 488 486 488 493 Solid Waste Division
Collection Trucks 83 83 84 89 81 85 86 86 88 88
Water Division
Water Mains (miles) 1,782 1,803 1,799 1,801 1,809 1,827 1,859 1,871 1,880 1,889 Wells 273 271 260 261 260 263 262 262 264 271
Fire Hydrants 13,001 13,139 13,170 13,218 13,332 13,484 13,536 13,638 13,717 13,784 Sewer Maintenance Division
Sewer Mainlines (miles) 1,521 1,529 1,533 1,536 1,539 1,613 1,558 1,628 1,579 1,593 Manholes 23,384 23,644 23,776 22,834 23,947 24,146 24,359 25,546 25,546 25,046 Lift Stations 15 15 15 15 15 15 14 16 16 17
Parks
Metropolitan Parks (Regional) 3 3 3 3 3 3 3 3 3 3
Neighborhood Parks 31 31 32 33 34 34 34 34 34 34
Pocket Parks 21 21 21 21 21 21 21 21 21 21
Zoo 1 1 1 1 1 1 1 1 1 1
Golf Courses 2 2 2 2 2 2 2 2 2 2
Community Parks 1 1 1 1 1 1 1 1 1 1
Skate Parks 6 6 6 8 8 8 8 8 8 8
Tennis Courts 40 40 40 42 42 42 42 42 42 42
Acres of Parks 1,535 1,535 1,384 1,392 1,393 1,393 1,393 1,393 1,393 1,393 Neighborhood Centers 12 12 12 12 12 12 12 12 12 12
Community Center 5 5 5 5 5 7 7 7 7 7
Swimming Pools 5 9 9 9 9 9 8 8 8 8
238
CITY OF FRESNO, CALIFORNIA
Capital Asset Statistics by Function/Program
Last Ten Fiscal Years (continued)
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Transportation
Airports 2 2 2 2 2 2 2 2 2 2
Municipal Airport Total Acreage 1,875 1,875 1,875 1,875 1,875 2,050 2,050 2,050 2,050 2,050 Length of Longest Runway (surfaced) -
Linear Feet 9,227 9,539 9,539 9,539 9,539 9,539 13,165 13,165 13,165 13,165 Number of Runways 3 3 3 3 3 3 3 3 3 3
Number of Terminals 2 2 2 2 2 2 2 2 2 2
Terminals (square footage) 193,364 193,364 193,364 193,364 193,364 193,364 193,364 193,364 193,364 193,364 Number of Parking Spaces (surface lot) 2,365 2,365 2,365 2,355 2,664 2,664 2,664 2,812 3,074 4,038 Air Cargo Ramp Spaces 9 9 9 8 8 9 9 9 8 8
Air Cargo Ramp (surface square
footage) 806,390 806,390 806,390 806,390 806,390 806,390 806,390 806,390 806,390 806,309 Number of Hangars 302 302 302 303 303 303 303 303 303 303 Buses - Directly Operated 110 111 105 105 129 138 102 100 102 105 Source(s): City of Fresno - Various Departments
Note(s): Information combined for Fresno Yosemite International (FYI) and Chandler Executive Airport (FCH).
The FY2016 reduction in Street(miles) is due to the non-inclusion of secondary segments on the major divided roads and is not associated with any road removal.
The Regional Sports Complex reported acreage was reduced from 268 acres to 114. While part of the Complex footprint, 154 acres are presently not available for public access.
Three acres were added due to the opening of Martin Ray Reilly Park in FY2015. 8.3 acres were added in FY2016 due to the opening of Inspiration Park.
In FY2020, Airports added stalls to a designated area not previously used for parking. This increased the number of stalls and had no affect on acreage.
In FY2022, there was a significant increase in the number of parking stalls at the airport due to completion of the new parking garage on the current parking lot location. Parking stalls no longer designated Hourly/Daily.
They are now Daily/Economy.
In FY2022, Squad companies were established to respond to medical and fire calls in a pickup rather than an engine or a truck.
Information not available for all years for all categories. 239
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