Fresno City Council
March 26, 2026

City of Fresno

Fresno, California

Annual Comprehensive Financial Report

For the Year Ended June 30, 2025

Prepared by
Finance Department

Fiscal Year Ended June 30, 2025
Prepared by the Finance Department
Fresno, California
Annual Comprehensive Financial Report Team
Santino Danisi
Controller/Finance Director
Kaleb Neufeld
Assistant Controller/Finance Director
Kamaljit Kaur, Division Manager
Philip Leung, Program Administrator
Roberta Cope, Principal Accountant
Enrique Herrera, Principal Accountant
Tricia Kelsey, Principal Accountant
Crystal Flores, Principal Accountant
Matthew Tamberi, Principal Accountant
Leslie Velasquez, Principal Accountant
Documents can be made accessible in alternative ADA Compliant format upon request. To request documents in alternative ADA Compliant format contact the Finance Department at (559) 621 -7001 or via email at [email protected].

Brandon Sisk, Grants Manager
Asuncion Ramos, Senior Accountant-Auditor
Stephanie Sumner, Management Analyst II
Larry Keomanyvanh, Accountant-Auditor II
Matthew Diaz, Accountant-Auditor II
Courtney Espinoza, Administrative Manager
Tracy bÍŽÍŘŘĺ, Management Analyst II
Jane Mouanoutoua, Payroll Manager
City of Fresno
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025

Table of Contents

i

Page

INTRODUCTORY SECTION (Unaudited)

Table of Contents ........................................................................................................................................................ i Controller's Transmittal Letter .................................................................................................................................... v City Operating Fund Structure ................................................................................................. .............................. xiv City Organizational Chart ......................................................................................................................................... xv Directory of City Officials ...................................................................................................................................... xvi Certificate of Achievement - Government Finance Officers Association ............................................................. xvii

FINANCIAL SECTION

Independent Auditor’s Report ................................................................................................................................ 1

Management’s Discussion and Analysis – Required Supplementary Information (Unaudited) ....................... 5

Basic Financial Statements:

Government-Wide Financial Statements:

Statement of Net Position ............................................................................................................................ 30 Statement of Activities ..................................................................................................... ........................... 32

Fund Financial Statements:

Governmental Funds Financial Statements:

Balance Sheet .............................................................................................................. .......................... 39 Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position ...................................................................... 40 Statement of Revenues, Expenditures, and Changes in Fund Balances ................................................ 41 Reconciliation of the Government al Funds Statement of Revenues, Expenditures, and Changes in Fund Balances of Government-Wide Statement of Activities a nd Changes in Net Position ..................................................................... 42 Proprietary Funds Financial Statements:

Statement of Net Position .................................................................................................. ................... 44 Statement of Revenues, Expen ses and Changes in Net Position .......................................................... 48 Statement of Cash Flows .................................................................................................... ................... 50 Fiduciary Funds Financial Statements:

Statement of Fiduciary Net Position ........................................................................................ ............. 57 Statement of Changes in Fiduciary Net Position .................................................................................. 58

Notes to the Basic Financial Statements ......................................................................................................... 65

City of Fresno
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025

Table of Contents (Continued)

ii

Page
FINANCIAL SECTION (Continued)

Required Supplementary Information (Unaudited):

Budgetary Information ........................................................................................................ ............................. 149

Schedule of Revenues, Expenditures, and Ch ange in Fund Balance – Budget and Actual:

General Fund ................................................................................................................ ............................. 151 Grants Special Revenue Fund ................................................................................................. ................... 152

Schedule of Investment Returns ............................................................................................... ........................ 153

Schedule of Changes in the Net Pens ion Liability (Asset) and Related Ratios:

Fire and Police Retirement System ........................................................................................... ................ 154 Employees Retirement System ................................................................................................. ................. 156

Schedule of Employer Contribut ions - Pension Trust Funds:

Fire and Police Retirement Systems .......................................................................................... ................ 158 Employees Retirement Systems ................................................................................................ ................ 158

Schedule of Changes in the Net OPEB Liability and Related Ratios .............................................................. 159

Supplementary Information:

Combining and Individual Fund Financial Statements and Schedules:

Non-Major Governmental Funds:

Combining Balance Sheet ..................................................................................................... .................... 164 Combining Statement of Reve nues, Expenditures and Changes in Fund Balances ........................................................................................................... ...................... 167

Schedule of Revenues, Expenditures and Changes in
Fund Balances – Budget and Actual:

High Speed Rail Special Revenue Fund ....................................................................................... ...... 170 Special Gas Tax Special Revenue Fund ....................................................................................... ....... 171 Measure C Speci al Revenue Fund ...................................................................................................... 172 Measure P Special Revenue Fund ............................................................................................. .......... 173 Community Services Special Revenue Fund .................................................................................... .. 174 UGM Impact Fees Sp ecial Revenue Fund .......................................................................................... 175 Low and Moderate Income H ousing Special Revenue Fund .............................................................. 176 Special Assessments Special Revenue Fund ................................................................................... .... 177 City Combined Capital Projects Fund ........................................................................................ ......... 178

Nonmajor Enterprise Funds:

Combining Statement of Net Position ......................................................................................... .............. 180 Combining Statement of Revenues, Expen ses and Changes in Fund Net Position ................................... 183 Combining Statement of Cash Flows ........................................................................................... ............. 184 City of Fresno
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025

Table of Contents (Continued)

iii
Page
FINANCIAL SECTION (Continued)

Supplementary Information (Continued):

Internal Service Funds:

Combining Statement of Net Position ......................................................................................... .............. 188 Combining Statement of Revenues, Expe nses, and Changes in Net Position ........................................... 191 Combining Statement of Cash Flows ........................................................................................... ............. 192

Fiduciary Funds:

Combining Statement of Fiduciary Net Position –
Fiduciary Funds - Pension Trust Funds ...................................................................................... ........ 197 Combining Statement of Changes in Fiduciary Net Position – Fiduciary Funds - Pension Trust Funds ...................................................................................... ........ 198 Combining Statement of Fiduciary Net Position –
Fiduciary Funds - Private Purpose Trust Funds .............................................................................. .... 201 Combining Statement of Changes in Fiduciary Net Position – Fiduciary Funds - Private Purpose Trust Funds .............................................................................. .... 202

STATISTICAL SECTION (Unaudited)

Table of Contents .................................................................................................................................................... 205

Financial Trends:

Net Position by Component – Last Ten Fiscal Years ............................................................................ .......... 206 Changes in Net Position – Last Ten Fiscal Years .............................................................................. .............. 208 Fund Balances of Governmental Funds – Last Ten Fiscal Years .................................................................. .. 212 Changes in Fund Balances of Government al Funds – Last Ten Fiscal Years ................................................. 214

Revenue Capacity:

Gross Assessed Value and Estimated Actual Value of Taxable Property – Last Ten Fiscal Years ................. 217 Direct and Overlapping Property Tax Rates – Last Ten Fiscal Years ............................................................ . 218 Principal Property Taxpayers – Cu rrent Year and Nine Years Ago ................................................................ 219 Property Tax Levies and Collecti ons – Last Ten Fiscal Years ........................................................................ 220

Debt Capacity:

Ratios of Outstanding Debt by Ty pe – Last Ten Fiscal Years ......................................................................... 221 Ratios of General Bonded Debt Ou tstanding – Last Ten Fiscal Years ............................................................ 224 Direct and Overlapping Governmental Activities Debt .......................................................................... ......... 225 Debt Coverage Ratio – Airports ............................................................................................... ........................ 226 Debt Coverage Ratio - Water System ........................................................................................... ................... 228 Debt Coverage Ratio - Sewer System ........................................................................................... ................... 230 Pledged Revenue Coverage – Last Ten Fiscal Years ....................................................................................... 232 Legal Debt Margin Information ................................................................................................ ....................... 233

Demographic and Economic Information:

Demographic and Economic Statis tics – Last Ten Fiscal Years ...................................................................... 234 Principal Employers – Curren t Year and Nine Years Ago .............................................................................. 235 City of Fresno
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025

Table of Contents (Continued)

iv
Page

STATISTICAL SECTION (Unaudited) (Continued)

Operating Information:

Full Time Equivalent City Government Empl oyees by Function – Last Ten Fiscal Years ............................. 237 Operating Indicators by Function/Pr ogram – Last Ten Fiscal Years ............................................................... 238 Capital Asset Statistics by Function/ Program – Last Ten Fiscal Years ........................................................... 242

CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2025

V LETTER OF TRANSMITTAL

Jerry Dyer Georgeanne A. White
Mayor City Manager

2600 Fresno Street, Suite 2156 - Fresno, California 93721-3622

March 19, 2026

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 (the “City”) for the fiscal year ended June 30, 2025 (fiscal year 2024-2025), 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 of America (U.S. 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.

CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2025

VI LETTER OF TRANSMITTAL 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 117.2 square miles. With over half a million residents, (557,032 as of January 1, 2025), 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.

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.

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, 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.

CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2025

VII LETTER OF TRANSMITTAL 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.

Industry and Economy

The Fresno Metropolitan Statistical Area continues to see increasing number of industrial, manufacturing and service industries moving to the region. Additionally, Fresno is the economic hub of Fresno County and the San Joaquin Valley, with much of the surrounding areas in the Metropolitan region tied to large- scale agricultural production. While agriculture still makes up a large component of the region's employment base (12.4% of jobs), the Fresno economy continues to diversify, as evidenced by the fact that services (28.5% of jobs) and government (19.4% of jobs) employ more people than agriculture.

2016 vs. 2025 Estimated Number of Workers by Industry

Source: CA Employment Development Department

Distribution continues to play 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 continue to be major contribut ors to the City’s economy. The following table lists the principal employers of the City:

CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2025

VIII LETTER OF TRANSMITTAL Principal Employers (Public & Private Sector)
Employer Employees
Fresno Unified School District 15 ,748
Community Medical Centers 10,780
County of Fresno 9,156
Clovis Unified School District 8,470
Amazon 6,500
City of Fresno College 5,596
California State University, Fresno 5,297
State Community College District 5,187
Internal Revenue Service Center 4,477
Saint Agnes Medical Center 3,382

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 300 different commodities providing gross production of $9.0 billion in 2024, an increase of 5.7% from 2023.

Almonds took the lead on Fresno County's Top Ten crop ranking with $1.5 billion gross value in 2024, followed by grapes at $1.0 billion.

Fresno County continues to supply the highest-qua lity agricultural products nationwide and abroad.

California produces most of the grapes grown in the United States with a significant percentage of raisins coming from Fresno County. Additionally, the region is a significant exporter to many countries throughout the world. In Calendar Year 2024, Fresno County exported 96 unique agricultural commodities to 91 countries around the world.

CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2025

IX LETTER OF TRANSMITTAL

Fiscal Year 2025 Economic Conditions & Financial Impact

The Fresno economy continued its steady expansion throughout fiscal year 2025, continuing momentum and showing growing stability across major sectors, as illustrated in the table below.

Economic Indicator 2024 2025 Change (%)
Assessed Value (in Billions) $49.29 $52.15 5.8%
Taxable Sales (In Billions) $27.30 $26.67 (2.3)%
Unemployment Rate 8.1% 8.6% 6.2%
Building Permits 14,617 15,552 6.4%

Source: Fresno County Agriculture Department CY 2024

CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2025

X LETTER OF TRANSMITTAL Local economic improvements were similarly on display when considering key City of Fresno finance indicators, as summarized below, though fiscal year 2025 revenues and expenses reflect a modest decrease from the prior year:

• Total Assets increased $268.9 million (5.4%) from the fiscal year 2024 year-end Total Assets balance of $4.99 billion.
• Revenues decreased $121.1 million (-8.24%) from Revenues for fiscal year 2024, which totaled $1.47 billion.
• Expenses decreased $168.0 million (-13.5%) to $1.01 billion. • Total Net Position increased $271.3 million (8.3%) from fiscal year 2024’s total of $3.27 billion.

Summarized below are key metrics reflecting changes within the City's General Fund:

• Total Assets increased $12.7 million (7.1%) over the fiscal year 2024 Total Assets year-end balance of $178.7 million. An increase in Accounts Receivable of $8.1 million, along with a $2.4 million rise in Intergovernmental Receivable, was the primary driver of the overall growth in Total Assets. • Total Liabilities increased $7.5 million (18.0%) from the fiscal year 2024 year-end Total Liabilities of $41.5 million. A $6.9 million increase in Accrued Liabilities was the primary reason for this increase.
• Revenues increased $18.8 million (4.1%) from fiscal year 2024’s Revenues of $459.0 million. This was primarily related to Property Tax, which increased by $11.9 million (6.6%) over fiscal year 2024. • Expenditures increased by $10.2 million (2.2%) from the fiscal year 2024 level of $457.1 million.

Growth in Community Development and Public Ways and Facilities spending were the primary drivers 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, 2025

XI LETTER OF TRANSMITTAL How Fresno Compares to the 25 Largest California Cities

Although the City of Fresno’s financial position has continued to strengthen, it still trails other large California cities in the level of resources available to support its residents. As shown in the table on page VII, the gap between Fresno’s population ranking and its assets per capita remains one of the widest among the state’s 25 largest cities. Fresno’s standing is further influenced by the presence of a Net Pension Asset—an advantage unique among the cities surveyed—which elevates the City’s reported asset levels.

Even with this benefit, the City continues to face a structural disadvantage in its ability to provide services, as the overall asset base remains insufficient to fully and efficiently meet community needs. Maintaining disciplined fiscal management is therefore essential. The City must continue its long-term strategy to build and preserve all asset categories, with particular focus on strengthening cash reserves and investing in capital assets.

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, 2024. This was the 32
nd 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, 2025

XII LETTER OF TRANSMITTAL Total Government-Wide Assets per Capita
Top 25 California Cities Comparison (in Thousands)
City Total Assets ACFR
Year
Population
California
Department
of Finance
As of January 1,
2025
Assets per
Capita
Population
Ranking
Per Capita
Asset Rank
Net Pension
Asset/(Liability)
Los Angeles $ 95,587,79 2025 3,835,263 $ 25 1 2 $ (7,307,365) San Diego $ 19,996,38 2025 1,408,937 $ 14 2 10 $ (3,167,066) San Jose $ 11,398,09 2025 979,415 $ 12 3 11 $ (2,962,050) San Francisco $ 57,994,64 2025 835,987 $ 69 4 1 $ (4,283,424) Fresno $ 5,264,202 2025 557,032 $ 9 5 16 $ 347,590 Sacramento $ 6,044,508 2025 527,979 $ 11 6 12 $ (1,180,222) Long Beach $ 10,643,14 2024 458,813 $ 23 7 3 $ (1,487,532) Oakland $ 4,790,589 2025 426,457 $ 11 8 13 $ (1,774,610) Bakersfield $ 3,073,009 2023 411,109 $ 7 9 20 $ (537,204) Anaheim $ 6,007,934 2025 341,773 $ 18 10 5 $ (893,308) Stockton $ 3,179,679 2024 324,975 $ 10 11 15 $ (627,937) Riverside $ 5,017,218 2024 316,690 $ 16 12 8 $ (331,262) Irvine $ 4,536,737 2024 314,621 $ 14 13 9 $ (174,600) Santa Ana $ 2,256,182 2025 232,377 $ 9 14 23 $ (385,754) Chula Vista $ 2,788,133 2025 280,840 $ 10 15 14 $ (68,108) Santa Clarita $ 2, 012,636 2025 232,377 $ 9 16 17 $ (38,801) Fremont $ 1,591,679 2025 230,000 $ 7 17 22 $ (437,318) San Bernardino $ 1,345,989 2025 224,000 $ 6 18 24 $ (523,741) Modesto $ 2,082,831 2025 219,765 $ 9 19 16 $ (405,315) Fontana $ 1,773,787 2025 219,172 $ 8 20 21 $ (201,703) Moreno Valley $ 1,598,969 2025 210,823 $ 8 21 18 $ (81,163) Oxnard $ 3,272,386 2024 197,536 $ 17 22 7 $ (346,559) Huntington Beach $ 1,525,252 2025 196,276 $ 8 23 19 $ (180,704) Glendale $ 3,525,499 2025 192,212 $ 18 24 6 $ (650,370) Ontario $ 3,576,692 2025 184,404 $ 19 25 4 $ (123,229)

Note: Only figures for each Primary Government were used as of June 30, 2025, AFCR's (2024 or 2023 when 2025 not available). Component units were excluded in instances where they were reflected in separate columns.

CITY OF FRESNO | ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2025

XIII LETTER OF TRANSMITTAL

Acknowledgments

The preparation of the City of Fresno’s Annual Comprehensive Financial Report (ACFR) represents a major collaborative effort and reflects the dedication of many individuals across the organization. Producing a report of this scope requires sustained focus, technical expertise, and a strong commitment to accuracy.

The Finance Department staff demonstrated all of these qualities, working diligently throughout the year and navigating complex challenges to ensure the successful completion of the ACFR.

Recognition is also due to the numerous City departments whose partnership was essential to assembling the financial statements. Their timely responses, thoughtful contributions, and careful review of information played a critical role in maintaining the integrity and com pleteness of the report. This cross-departmental cooperation underscores the shared responsibility we hold in presenting transparent and reliable financial information to the community.

Appreciation is also extended to The Pun Group for their professional guidance and support during the preparation of the ACFR. In addition, sincere thanks are also due to the Mayor, the City Council, and the City Manager’s Office for their continued leadership and commitment to strong financial stewardship.

Respectfully submitted,

City Operating Fund Structure
Special
Revenue Fund
Internal
Services Fund
General Fund
Enterprise Fund
The General Fund is used to
account for unrestricted
revenues. Revenues received by
the City that have no legal or
contractual restriction are placed
in the various funds within the
General Fund.

Appropriations may
be made
from the General Fund for any
legal City activity. Revenues such
as sales tax, property tax, and
business tax are a few examples
of General Fund revenues.
x Mayor
x City Manager
x City Council
x City Clerk
x City Attorney
x Animal Center
x Capital Projects
x Finance
x Fire
x Planning & Development
x General City Purpose
x PARCS
x Police
x Personnel Services
Proprietary Fund Types operate
as if they were private
businesses. One type is
Enterprise Funds.

These funds provide services to
other governmental and
non­governmental entities,
including individuals and
businesses.
x Airports
x Transportation (FAX)
x Convention Center
x Stadium
x Public Utilities
x Park (Golf Course)
The Propriety Fund types operate
as if they were private
businesses. One type of
Proprietary Fund is the Internal
Service Funds that provide
services to departments within
the City.
x Retirement
x Personnel Services
(Risk Management)
x General Services
(Fleet Management)
x Information Services
x City Clerk
(Central Printing)
x Finance
(Utility Billing & Collection)
x Public Works
(Facilities Management)
This fund type accounts for a
significant amount of revenue
that the City receives which is
restricted as to its use. Examples
of this type of revenue would be
assessment districts,
Community Development Block
Grant, and various gas taxes.
x Public Works
x Planning & Development
x PARCS
xiv
City Organizational Chart

City Council Mayor
OƯice of Communications
Public Relations
Council
Assistants
City Attorney
Litigation
Administration
Transactions
Code Enforcement
Secretary to:

City Council
Successor Agency to the
RDA
Records Management
Administration
Central Printing (ISF)
City Departments
Support Services for Mayor and City Council
Citywide Project Management
OƯice of Independent Review
OƯice of Community AƯairs
OƯice of Emergency Preparedness
OƯice of Special Events
City Manager
Administration
Airport Projects Management
Airport Security & Safety
Fresno Chandler Executive
FYI Operations
Transportation
(FAX)
Bus Service
Bus Repair/Maintenance
Planning Administration
Paratransit
Planning &
Development
Airports Information
Services
Computer Services
Systems & Network Security
Help Desk
Systems & Applications I
Programming
Communications
One Call Center
City Clerk
Parks, After School,
Recreation &
Community Services
Administration
Capital Improvements
Park Maintenance
Sports & Recreation Programs
Community Services
Park Operations
Golf Course (Enterprise)
Convention
Center & Stadium
CC managed by ASM Global
Sporting Events
Conventions
Concerts
Emergency Shelter/Hosp
Services
Personnel
Services
Recruitment & Exam
Job & Salary Analysis
Civil Service Board
Employee Benefits
Training
Labor Relations
Risk Management (ISF)
Finance Fire Police
Economic
Development
Public Utilities
General
Services
Planning
Building & Safety Inspection
Development Review
Parking Services
Historic Preservation
Community Investment
Housing & Homeless
Public
Works
Accounting
Financial Reporting/Grants
Business Tax/Permits
Purchasing
Internal Audit
Utility, Billing & Collection (ISF)
Budget
Patrol & Crime Suppression
Investigative Services
Special Operations Admin.

Fire Suppression &
Emergency Response
HazMat
Prevention & Investigation
Training & Support Admin.

Street Maintenance
TraƯic Operations Center
ADA Citywide Program
TraƯic Signals & Streetlights
Urban Growth Management
Community Revitalization
Sustainable Fresno
GraƯiti
Water Production, Quality ,
Delivery
Wastewater & Sewer
Management
Solid Waste Services:

Recycling Program
Operation Clean-Up
Litter Control
Purchasing
DBE Program
Lease Administration
Facilities Management (ISF)
Fleet Management (ISF)
General City
Purpose
Fresno Revitalization Corporation
Support
Intergovernmental Relations
Citywide Resources & Appropriations
Retirement OƯice (Fiduciary)
Special Revenue Fund Internal Services Fund General Fund Enterprise Fund Citizens of
Fresno
Capital Projects
Animal Center
Administration
Design Services
Transportation Project
Management
Construction Management
Utilities & On-Site Project
Management
xv
Annalisa Perea
District 1
Mike Karbassi
District 2
Miguel Arias
District 3
Jerry Dyer
Mayor
Appointed Executive OƯicials
Georgeanne A. White, City Manager
TJ Miller, Assistant City Manager
Ruth F. Quinto, CPA, Assistant City Manager
Nick Mascia, Assistant City Manager
Andrew Janz, City Attorney
Amy Cobb, Interim City Clerk
Santino Danisi, Finance Director/Controller
Tyler Maxwell
District 4
As of June 30, 2025
Elected OƯicials
City of Fresno Directory of City OƯicials
Nelson Esparza
District 7
Nick Richardson
District 6
Brandon Vang
District 5
JD
xvi
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Fresno
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2024
Executive Director/CEO
xvii

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6 Hutton Centre Drive, Suite 1200
Santa Ana, California 92707

INDEPENDENT AUDITOR’S REPORT

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

Report on the Audit of the Financial Statements

Opinions

We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Fresno, California (the “City”), as of and for the year ended June 30, 2025, and the related notes to the basic financial statements , which collectively comprise the City’s basic financial statements as listed in the table of contents.

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2025, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting prin ciples generally accepted in the United States of America.

We did not audit the financial statements of the Successor Agency to the Fresno Re development Agency Private- Purpose Trust Fund (Successor Agency), the Low and Moderate Income Housing Special Revenue Fund (Low and Moderate Income Housing), the Fire and Police Retirement System Pension Trust Fund (Fire and Police Pension Trust), or the Employees Retirement System Pension Trust Fund (Employee Pension Trust) which collectively represent the following percentages of assets/deferred outflows of resources, net position/fund balance, and revenues/additions of the following opinion unit as of June 30, 2025:

Assets/
Deferred Ouflows Net Position/ Revenues/
Opinion Unit of Resources Fund Balance Additions
Aggregate Remaining Fund Information 88.47% 96.27% 87.18%

Those statements were audited by other auditors whose report has been furnished to us, and our opinions, insofar as it relates to the amounts included for the Successor Agency, Low and Moderate Income Housing, Fire and Police Pension Trust, and Employee Pension Trust, are based solely on the report of the other auditors.

Basis for Opinions

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

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

2 Responsibilities of Management for the Financial Statements

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

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

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whet her the financial statements as a whole are free from material misstatement, whether due to fraud or error, a nd to issue an auditor’s report that includes our opinions.

Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with auditing standards ge nerally accepted in the United States of America and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the ove rride of internal control. Misstatements are considered material if there is a substantial like lihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with auditing standards generally accepted in the United States of America and Government Auditing Standards, we

 exercise professional judgment and maintain professional skepticism throughout the audit.

 identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to t hose risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

 obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpo se of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed.

 evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

 conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.

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

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

3 Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the Management’s Discussion and Analysis, Budgetary Comparison Schedules, Schedule of Investment Returns, Schedules of Changes in Net Pension Liability (Asset) and Related Ratios, Schedules of Contributi ons – Pension, and Schedule of Changes in Total OPEB Liability and Related Ratios, as listed in the accompanying ta ble of contents, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Boar d who considers it to be an essential part of financial reporting for placing the basic financial statements in an appr opriate operational, economic, or histori cal context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inqui ries of management about the methods of preparing the information and comparing the informa tion for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Supplementary Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The Combining and Individual Non-major Fund Financial Statements and Schedules, are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The informa tion has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlyi ng accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the Combining and Individual Non-Major Fund Financial Statements and Schedules are fairly st ated, in all material respects, in relation to the basic financial statements as a whole.

Other Information

Management is responsible for the other information included in the annual report. The other information comprises the Introductory and Statistical Sections but does not include the basic financial statements and our auditor’s report thereon.

Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.

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

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

4 Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards , we have also issued our repor t dated March 19, 2026, on our consideration of City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the r esults of that testing, and not to provide an opinion on the effectiveness of City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering City’s internal control over financial reporting and compliance.

Santa Ana, California
March 19, 2026

City of Fresno
Management’s Discussion and Analysis (Unaudited)
For the Fiscal Year Ended June 30, 2025

5 CITY OF FRESNO, CALIFORNIA

This section of the City of Fresno’s (City) Annual Co mprehensive Financial Report (ACFR) presents a narrative overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2025. 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 transm ittal at the front of this report. This discussion and analysis provide comparisons primarily for th e previous two years, but it may include more extensive comparisons in some instances.

FINANCIAL HIGHLIGHTS

• The assets of the City surpassed $5.00 billion, reaching a total of approximately $5.26 billion.

• Overall, the City experienced a decline in revenue driven primarily by a combined $145.0 million (-27.4%) decrease in Operating Grants, Capital Grants, and Contributions. However, the City also experienced a $161.7 million (-19.6%) reduction in governmental activities. With these changes and prudent strategic planning, the City’s net position increased by $273.8 million (8.4%), reaching $3.54 billion.

• The City continues to record a Net Pension Asset. For fiscal year 2025, the Net Pension Asset was $347.6 million, an increase of $51.2 million (17.3%). The City of Fresno remains one of very few government entities in the country with a Net Pension Asset.

OVERVIEW OF FISCAL YEAR 2025 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 long-term a nd 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 be tween them is reported as net position. Over time, increases or decreases in net position ma y 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 dur ing 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.

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, and stadium.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

6 The Government-Wide Financial Statements include not on ly 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, and Fresno Revitalization Corporation. The co mponent units have been “blended” in to the City’s financial statements because the governing board (although legally separate from the City) is substantia lly the same as the City’s, or they provide services entirely or almost exclusively for the bene fit 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 th e Successor Agency would pay all “enfor ceable obligations” of the former RDA. The Successor Agency is consid ered 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 30-33 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 f unctions 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 Stat ements is narrower than that of the Government-Wide Financial Statements, it is helpful to compare the info rmation 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 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 40 and 42.

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, aggregat ed 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 plans for taxpayers/ratepayers resources. Budgetary comparison sch edules 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.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

7 • 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 th e private sector businesses: the accrual basis of accounting.

The City maintains the following two types of Proprietary Funds:

† Enterprise Funds 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.

† 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 Acti vities in the Government-Wide Financial Statements, whereas Billing and Collection is included in the Busi ness-Type Activities in the Government-Wide Financial Statements. The Internal Service Funds are combined into a single, aggreg ated 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-rela ted trust activity, such as payroll withholding and bid deposits. Custodial Funds also include Speci al Assessment Funds that account for debt service transactions involving special assessment districts within the City.

The basic financial statements can be found on pages 30-33 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 65-146 of this report.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

8 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 151-161 of this report.

Combining and Individual Fund Statements and Schedules

The combining statements referred to earlier in connection with non ma jor 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 166-171 of this report.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

9 GOVERNMENT-WIDE FINANCIAL ANALYSIS

The City presents its financial statements under the reporting model required by th e Governmental Accounting Standards Board Statement No. 34 (GASB 34), Basic Fina ncial Statements - and Ma nagement’s Discussion and Analysis (MD&A) - for State and Local Governments.

Net Position - Government-Wide / Primary Government
(in thousands)
2024 2025 2024 2025 2024 2025 $ %
Assets:

Current and Other Assets 871,602 $ 880,121 $ 1,001,464 $ 1,048,091 $ 1,873,066 $ 1,928,212 $ 55,146 $ 2.9% Net Pension Asset 234,411 276,338 62,015 71,252 296,426 347,590 51,164 17.3% Capital Assets:

Not Being Depreciated 463,730 628,684 245,989 333,591 709,719 962,275 252,556 35.6% Net of Accumulated Depreciation 684,052 661,597 1,432,074 1,364,528 2,116,126 2,026,125 (90,001) -4.3% Total Capital Assets 1,147,782 1,290,281 1,678,063 1,698,119 2,825,845 2,988,400 162,555 5.8% Total Assets 2,253,795 $ 2,446,740 $ 2,741,542 $ 2,817,462 $ 4,995,337 $ 5,264,202 $ 268,865 $ 5.4% Deferred Outflows of Resources:

Deferred Outflow s - Pension 122,445 154,976 29,499 34,365 151,944 189,341 37,397 24.6% Deferred Outflows - OPEB 18,646 15,506 7,801 6,476 26,447 21,982 (4,465) -16.9% Total Deferred Outflow s of Resources 141,091$ 170,482 $ 37,300 $ 40,841 $ 178,391 $ 211,323 $ 32,932 $ 18.5% Liabilities:

Long-T erm Liabilities Due Within One
Year 99,077 60,799 31,506 28,643 130,583 89,442 (41,141) -31.5% Long-T erm Liabilities Due in More than
One Year 588,984 627,617 686,568 678,802 1,275,552 1,306,419 30,867 2.4% Other Liabilities 271,227 217,862 123,247 131,566 394,474 349,428 (45,046) -11.4% Total Liabilities 959,288 $ 906,278 $ 841,321 $ 839,011 $ 1,800,609 $ 1,745,289 $ (55,320) $ -3.1% Deferred Inflows of Resources:

Pension Revenue Applicable to Future
Years 16,304 81,072 7,066 18,583 23,370 99,655 76,285 326.4% Unamortized OPEB Expense 44,313 49,786 19,213 21,176 63,526 70,962 7,436 11.7% Leases 3,837 6,050 20,990 13,858 24,827 19,908 (4,919) -19.8% Total Deferred Inflow s of Resources 64,454 $ 136,908 $ 47,269 $ 53,617 $ 111,723 $ 190,525 $ 78,802 $ 70.5% Net Position:

Net Investment in Capital Assets 881,764 1,273,621 987,193 1,021,386 1,868,957 2,295,007 426,050 22.8% Restricted 454,508 634,897 62,015 71,252 516,523 706,149 189,626 36.7% Unrestricted 34,872 (334,482) 845,548 873,037 880,420 538,555 (341,865) -38.8% Total Net Position 1,371,144 $ 1,574,036 $ 1,894,756 $ 1,965,675 $ 3,265,900 $ 3,539,711 $ 273,811 $ 8.4% T otal Change from Prior
YearTo t a l
Governmental
Activities
Business-T ype
Activities

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

10 Changes in Net Position - Government-Wide / Primary Government (in thousands)
2024 2025 2024 2025 2024 2025 $ %
Rev enues
Program Revenues:

Charges for S ervices 116,371 $ 104,383 $ 313,377 $ 316,409 $ 429,748 $ 420,792 $ (8,956) $ -2.1% Operating G rants & Contributions 132,944 101,077 52,958 50,395 185,902 151,472 (34,430) -18.5% Capital G rants & Contributions 101,289 185,283 242,831 48,267 344,120 233,550 (110,570) -32.1% G eneral Revenues:

Property Taxes 180,976 192,854 - - 180,976 192,854 11,878 6.6% Business T ax 23,197 30,653 - - 23,197 30,653 7,456 32.1% S ales Taxes - S hared Revenues 197,924 193,373 - - 197,924 193,373 (4,551) -2.3% Other Local Taxes 42,627 42,112 - - 42,627 42,112 (515) -1.2% Investment Earnings 26,928 24,098 39,051 51,591 65,979 75,689 9,710 14.7% G ain on S ale of Capital Assets 172 1,330 - 19 172 1,349 1,177 684.3% Total Revenues 822,428 $ 875,163 $ 648,217 $ 466,681 $ 1,470,645 $ 1,341,844 $ (128,801) $ -8.8% Ex pe n s e s
G eneral G overnment 92,381 $ 58,969 $ - $ - $ 92,381$ 58,969 $ (33,412) $ -36.2% Public Protection 367,609 344,765 - - 367,609 344,765 (22,844) -6.2% Public Ways and Facilities 173,153 77,644 - - 173,153 77,644 (95,509) -55.2% Culture and Recreation 68,735 89,147 - - 68,735 89,147 20,412 29.7% Community Development 109,567 81,272 - - 109,567 81,272 (28,295) -25.8% Interest on Long-Term Debt 13,423 11,399 - - 13,423 11,399 (2,024) -15.1% S ewer, Water and S olid Waste - - 269,930 245,542 269,930 245,542 (24,388) -9.0% Trans it - - 83,681 90,131 83,681 90,131 6,450 7.7% Airports - - 45,359 47,953 45,359 47,953 2,594 5.7% Fresno Convention Center - - 8,750 9,088 8,750 9,088 338 3.9% Community S anitation - - 10,445 8,509 10,445 8,509 (1,936) -18.5% Parks and Recreation - - 385 472 385 472 87 22.6% St adium - - 2,862 3,142 2,862 3,142 280 9.8% Total Expenses 824,868 $ 663,196 $ 421,412 $ 404,837 $ 1,246,280 $ 1,068,033 $ (178,247) $ -14.3% Increase (Decrease) in Net Position
Before Transfers (2,440) 211,967 226,805 61,844 224,365 273,811 49,446 22.0% Transfers (6,580) (9,075) 6,580 9,075 - - - Change in Net Position (9,020) 202,892 233,385 70,919 224,365 273,811 49,446 22.0% Net Position - Beginning 1,380,164 1,371,144 1,661,371 1,894,756 3,041,535 3,265,900 224,365 7.4% Net Position - E nding 1,371,144$ 1,574,036 $ 1,894,756 $ 1,965,675 $ 3,265,900 $ 3,539,711 $ 273,811 $ 8.4% Governmental
Activities
Business-T ype
Activities To t a l T otal Change from Prior
Year

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

11 Analysis of Changes in Government-Wide Net Position

The City’s overall Net Position increased to $3.54 billion: a $273.8 million (8.4%) increase from fiscal year 2024’s Net Position of $3.27 billion. This was mainly due to an increase in the Restricted Net Position, going from $516.5 million in fiscal year 2024 to $706.1 million in fiscal year 2025.

Several factors contributed to the overall increase in Net Position:

• The City’s overall revenue decreased (8.8%) from $1.47 billion in fiscal year 2024 to $1.34 billion in fiscal year 2025. Contributing factors include a decrease in Charges for Services from $429.7 million in fiscal year 2024 to $420.7 million in fiscal year 2025 and increase in General Revenue due to Property Taxes increasing $11.9 million (6.6%), going from $180.9 million in fi scal year 2024 to $192.8 m illion in fiscal year 2025.

Operating grants decreased by $34.4 million from $185.9 million in fiscal year 2024 to $151.4 million in fiscal year 2025, Capital Grants decreased by $110.5 million from $344.1 million in fiscal 2024 to $233.5 million in fiscal year 2025.

• City Expenses decreased from $1.25 billion in fiscal y ear 2024 to $1.07 billion in fiscal year 2025. This was the result of a decrease of $161.7 million (19.6%) in Governmental Activities Expenses and a decrease of $16.5 million (3.9%) in Business-Type Activities Expenses. Th e primary driver of the decrease in Governmental Activities Expenses was a $33.4 million decrease in General Government expenses, a $22.8 million decrease in Public Protection expenses, a $95.5 million decre ase in Public Way and Facility expenses, $20.4 million increase in Culture and Recreation expenses, and a $28.2 million decrease in Community Development expenses. Business-Type Activities resulted in a $24.3 million decrease in Sewer, Water and Solid Waste expenses and $1.9 million decrease in Community Sanitation expenses.

• Total Assets increased from $5.0 billion in fiscal year 2024 to approximately $5.26 billion in fiscal year 2025, a $ 268.8 million (5.4%) increase. The increase in Total Assets was the result of a $162.5 million increase Total Capital Assets, a $26.1 million increase in Restricted Cash and Investments and a $51.2 million increase in Net Pension Asset.

• Total Deferred Outflows of Resources increased by $32. 8 million (18.4%) from fiscal year 2024's amount of $178.4 million, mainly due to a $37.4 million increase of Deferred Outflows – Related to Pensions.

• Total Liabilities decreased by $55.3 million (3.1%) from $1.80 billion in fiscal year 2024 to $1.75 billion in fiscal year 2025. The overall decrease in Total Liabilities was mainly attributable to a decrease of $71.4 million in Unearned Revenue.

• A $78.8 million (70.5%) increase in the Deferred Inflow s of Resources, primarily caused by an increase in Pension Revenue Applicable to Future Years.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

12 Governmental Activities

In fiscal year 2025, the Net Position for Governmental Activities increased by $202.8 million (14.8%) to $1.57 billion.

The increase in Net Position occurred primarily within P ublic Ways and Facilities, which increased by $192.4 million to fiscal year 2025’s Public Ways and Facilities ending Ne t Position of $206.9 million. Key factors impacting the Unrestricted Net Position Deficit were:

• Revenues increased from $815.8 million in fiscal year 2024 to $866.1 million in fiscal year 2025, a $50.3 million (6.2%) increase. The overall increase was prim arily due to an increase in Capital Grants and Contributions of $83.9 million (82.9%) to $185.2 million.

• Expenses decreased from $824.9 million in fiscal year 2024 to $663.2 million in fiscal year 2025, led by a

55.2% decrease in Public Ways and Facilities expenses, going from $173.2 million in fiscal year 2024 to $77.6 million in fiscal year 2025, and a decrease in General Government expenses, going from $92.3 million in fiscal year 2024 to $58.9 million in fiscal year 2025, and a decrease in Community Development from $109.5 million in fiscal year 2024 to $81.2 million in fiscal year 2025.

• Total Assets increased by $192.9 million (8.5%) from fiscal year 2024’s Total Assets amount of $2.25 billion.

The overall increase in Total Assets was primarily caused by an increase of $43.9 million (51.8%) in Loans and Notes Receivable from $84.7 million in fiscal year 2024 to $128.6 million in fiscal year 2025, an increase of $10.7 million in Accounts Receivable from $126.9 million in fiscal year 2024 to $137.7 million in fiscal year 2025, and an increase of $51.1 million (17.3%) in the Ne t Pension Asset from $234.4 million in fiscal year 2024 to $276.3 million in fiscal year 2025.

• Total Liabilities decreased by $53.0 million, from fiscal year 2024’s Total Liabilities of $959.2 million. The primary drivers include a $72.2 million decrease in Unearned Revenue from $192.3 million in fiscal year 2024 to $120.0 million in fiscal year 2025.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

13 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 demonstrated below, Public Protection is by far the largest function reflecting the City’s greatest overall expenses.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

14 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 $ $109.0 millio n in fiscal year 2024 to $110.2 million in fiscal year 2025. The Unassigned Fund Balance decreased from $39.0 million in fiscal year 2024 to $33.6 million in fiscal year 2025, a $5.4 million (-13.8%) decrease.

Fiscal year 2025's revenues continued to show growth wh en compared to fiscal year 2024’s revenues, increasing by $11.2 million (2.4%) from fiscal year 2024’s total of $459.0 million. The increase was found primarily in Taxes, which increased $7.7 million (2.0%). The main driver in the overall increase in Ta x Revenue came from an $11.9 million increase in Property Taxes, due to increased property assessed valuations. This tax category continues to be a strong and stable source of total revenue sources.

General Fund expenditures experienced a slight increase of $2.5 million, or 0.5%, to a total of $459.6 million.

Summarized below are the various changes in expenditure categories:

• A decrease in Public Protection expenditures, which decreased from $315.9 million in fiscal year 2024 to $298.3 million in fiscal year 2025, a $17.6 million, or 5.5 decrease. • An increase in Capital Outlay expenditures, whic h increased from $10.8 million in fiscal year 2024 to $18.4 million in fiscal year 2025, a $7.6 million or 70.0% increase. • An increase in Public Ways and Facilities expenditure, which increased from $16.0 million in fiscal year 2024 to $20.2 million in fiscal year 2025, a $4.1 million or 25.8% increase.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

15 A large portion of the difference between actual expenditur es and actual revenues was funded by transfers from other funds. Overall, Transfers-In decreased $0.3 million (-6.1%) to $5.9 million.

Total Assets increased by $12.7 million (7.1%) to $191.4 million. The increase was driven by the following:

• Accounts Receivable, which increased $5.2 million (21.0%) to $30.1 million • Cash and Investments, which increased $3.8 million (8.6%) to $48.0 million

Total Liabilities increased compared to the prior fiscal year. Total Liabilities increased by $7.5 million (18.0%) to $48.9 million. The overall increase in Total Liabilities can be attributed to an increase in amounts payable of $6.8 million.

Significant committed fund balance amounts of the General Fund include:

• $47.7 million for the General Fund Emergency Reserve, • $5.3 million for the 27th Pay Period Reserve.

General Fund Budget to Actual Comparison

The fiscal year 2025 Adopted Budget was made up of $522 .5 million of budgeted re venues and $537.4 million of appropriations. After various amendments were made throughout the fiscal year, the General Fund ended the fiscal year with $523.6 million of budgete d revenues and $554.9 million of appropriations. Actual results on a budgetary (cash) basis of accounting were $470.2 million of revenues and $459.6 million of expenditures.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

16 The major differences between the budget and the actual results are noted below (Actual Budgetary Basis excludes all FY25 activity that posted after June 30, 2025):

Comparison of Revenues and Expenditures - Budget to Actual / General Fund (in thousands)

Budgeted
Original
Budgeted
Final
Actual
Budgetary
(Cash)
Basis
Over (Under)
Final Budget Explanation
Revenues:

Property Taxes $189,806 $180,806 $190,137 $331 Assessed values of homes continued to increase due to the strong demand for housing in the Central Valley.

Sales Tax $151,746 $151,146 $146,400 ($5,346)
Lower than anticipated sales tax due to economic uncertainty and rising inflation costs which has resulted in less consumer spending.

Charges for
Services $43,572 $43,572 $37,933 ($5,639)
Lower than expected demand for specific services (i.e., Police Event Services) and growth in service-related activities, contributed to the rise in revenue.

Expenditures:

Public Ways &
Facilities
$24,018

$24,437

$20,167

$4,270

Delays in the completion of planned infrastructure projects, such as road repairs and facility upgrades, resulted in expenditures being deferred to future periods. Additionally, some projects were either scaled back or adjusted to align with changing priorities, leading to lower than expected costs.

Community
Development
$74,127

$77,851

$47,742

$30,109

Delays in the execution of planned community projects and programs led to lower-than-expected expenditures. In
addition, some initiatives were postponed or scaled back in response to shifting priorities or adjustments in available funding.

Capital Outlay
$10,160

$14,577

$18,398

($3,821)

Increase is mainly attributed to planned capital projects, including infrastructure improvements, equipment purchases, and building upgrades.

A more detailed look at the budget versus actual co mparison for the General Fund can be found on page 151 in the Required Supplementary Information section.

Grants Special Revenue Fund

Fund Balance in the Grants Special Revenue Fund increased from $42.6 million in fiscal year 2024 to $65.1 million in fiscal year 2025. Total Liabilities decreased from $188.2 millio n in fiscal year 2024 to $135.4 million in fiscal year 2025, a $52.8 million (28.0%) decrease. Th is is mainly due to Unearned Revenue decreasing from $170.0 million in fiscal year 2024 to $108.1 million in fiscal year 2025, a 36.4% decrease.

Fiscal year 2025 revenues, in the Grants Special Reve nue Fund, increased $26.4 million (16.6%) to $184.9 million.

Expenditures increased by $2.7 million (1.7%) from fiscal year 2024’s total of $158.3 million to fiscal year 2025’s total of $161.1 million. Large increases in Public protection (increase of $25.7 million or 138.6%), were offset by decreases for the General Government category (down $9.7 million or 62.3%), and Public ways and facilities (down $5.4 million or 21.2%).

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

17 Other Governmental Funds

Fund Balance for the Other Governmental Funds increased $28.7 million between fiscal year 2024 and fiscal year 2025 ($275.7 million versus $304.4 million, r espectively). The growth in the Fund Balance was primarily due to a $10.1 million increase in the UGM Impact Fees Fund and a $6.9 million increase in Fund Balance for the Measure P Fund.

Business-Type Activities

Business-Type Activities for fiscal year 2025 increased the Net Position by $70.9 million (0.1%) over fiscal year 2024’s Business-Type Activities Net Position of $1.9 billion. Key factors affecting the Net Position were:

• Total Assets increased by $75.9 million (2.8%) from fiscal year 2024’s Total Asset balance of $2.74 billion.

This growth was primarily due to a $24.1 million (4.7%) increase in Restricted C ash, to the fiscal year 2025 amount of $537.8 million; a $25.1 million (6.0%) increase in Cash and Inv estments, compared to the fiscal year 2024 figure of $414.5 million; and a $87.6 milli on (35.6%) increase in assets Not Being Depreciated, compared to the fiscal year 2024 figure of $245.9 million. This was offset by a $36.6 million (38.1%) decrease in Receivables, Net to the fiscal year 2025 figure of $59.4 million.

• Total Liabilities decreased by $2.3 million (0.2%), from fiscal year 2024’s Total Liabilities of $841.3 million.

• Revenues went from $609.2 million in fiscal year 2024 to $415.1 million in fiscal year 2025; a $194.1 million (31.9%) decrease. This decrease is largely attributed to a $180.5 million (97.8%) decrease in Water Capital Grants and Contributions Revenues, due to one-time revenues.

• Expenses went from $421.4 million in fiscal year 2024 to $404.8 million in fiscal year 2025; a $16.6 million (3.9%) decrease. The primary driver behind this d ecrease was a $13.2 million (9.3 %) decrease in the Water Fund's expenses. Additionally, a decrease of $6.9 million (16.2%) in Solid Wast Management's expenses.

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.

As shown below, Sewer, Water and Solid Waste are the la rgest Business-Type Activities reflecting the City’s greatest overall expenses.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

18 City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

19 The following is an analysis of some of the funds within the Business-Type Activities category:

Water System

The Water System Fund's (Water) Net Position showed an increase over fiscal year 2024 levels. Net Position increased from $723.8 million in fiscal year 2024 to $756.7 million in fiscal year 2025, an increase of $32.9 million (4.5%). The change in Net Position was driven by the following factors:

• Total Assets increased by $17.4 million (1.5%) over the fiscal year 2024 balance of $1.15 billion. This was primarily due to a $56.6 million (20.6%) increase in Restricted Cash, partially offset by a $21.5 million (13.0%) decrease in Cash and Investments and an $18.9 million (2.9%) decrease in Total Capital Assets.

• Operating Expenses decreased by $11.9 million (9.3%) to $116.8 million in fiscal year 2025. The decrease was primarily driven by a $4.1 million (10.1%) reduction in Contractual Services, a $2.9 million (17.7%) decrease in Interdepartmental Charges, a $2.3 million (12.6%) decrease in Personnel Services, and a $2.2 million (14.7%) decrease in Materials and Supplies.

• Non-Operating Revenue (Expenses) increased from $2.2 million to $15.7 million; a $13.5 million (618.7%) increase. This was primarily due to a $5.6 million (57.1%) increase in Interest Income, increasing from $9.8 million in fiscal year 2024 to $15.4 million in fiscal year 2025. In addition, Unrealized Gain/Loss increased from $2.8 million in fiscal year 2024 to $10.8 million in fiscal year 2025, a $8.0 million (283.8%) difference.

• Total Liabilities decreased from $431.2 million in fiscal y ear 2024 to $414.4 million in fiscal year 2025, a reduction of $16.8 million (3.9%). This was mainly driv en by a $12.4 million (3.2%) decrease in Long-Term debt related to the paydown of various notes and lo ans, and a $2.0 million (22. 6%) decrease in Unearned Revenue.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

20 Sewer System

The Sewer System Fund's (Sewer) Net Position increased by $12.4 million (1.6%), rising from $761.6 million in fiscal year 2024 to $773.9 million in fiscal y ear 2025. The increase in Net Position was driven by a $35.7 million (4.0%) increase in Total Assets, primarily due to increases in Cash and Cash Equivalents of $42.4 million (26.6%). These increases were partially offset by a $0.9 million (6.0%) decrease in Accounts Receivable.

Total Liabilities also increased by $21.9 million (18.4%), primarily due to a $22.54 million Finance purchase agreement.

Operating Revenues declined by $10.4 m illion or (11.6%), driven by decrease in Customer User Charges. Operating Expense also decreased, falling from $84.4 million to $79.4 million, a reduction of $4.9 million (5.9%), mainly due to a $1.9 million (10.5%) decrease in Contractual Services.

Solid Waste Management

The Solid Waste Management Fund's (Solid Waste) Net Position increased from $18.8 million in fiscal year 2024 to $25.6 million in fiscal year 2025; a $6.8 million (35.9%) increase. This improve ment was primarily driven by a $3.9 million (8.9%) increase in Total Assets, which included a $4.3 million (99.8%) increase in Cash and Cash Equivalents over the fiscal year 2024 balance of $4.3 million. In addition, Total Capital Assets increased by $2.3 million (46.3%) to $7.4 million, largely due to a $2.4 millio n (155.4%) increase in Buildings and Im provements compared to fiscal year 2024.

Solid Waste's Operating Expenses decreased by $6.1 million (14.8%) in fiscal year 2025, mainly due to a $5.6 million (43.1%) decrease in Contractual Services. Additionally, Operating Revenues increased by $9.4 million (30.2%), rising from $30.9 million to $40.3 million. The primary driver of this increase was an $8.2 million (22.9%) rise in Customer User Charges.

Transit

The Transit Fund continues to experience increased ridershi p in 2025. Transit transporte d 10.4 million passengers in fiscal year 2025, a 28% increase from fiscal year 2024 riders hip of 8.1 million passengers. Overall, transit ridership continues to grow and has nearly returned to pre-pandemic levels.

Transit's Operating Revenues decreased slightly, falling $1.1 million (29.9%) from $3.6 million to $2.5 million in fiscal year 2025. Operating Expenses increased by $7.1 million (8.6%) over the prior fiscal year’s activity of $82.4 million.

In addition, Non-Operating Revenues decreased by $1.7 million (3.5%), mainly due to a $1.1 million (2.4%) decrease in Operating Grant Revenue.

Total Assets decreased by $25.7 million (10.7%), primarily due to a $22.9 million (99.5%) decrease in Cash and Cash Equivalents. This decline was partially offset by a $3.2 million (19.0%) increase in Net Pension Asset and a $1.6 million (18.2%) increase in Grants Receivable.

The combined impact of fiscal year 2025 activity caused the Transit Fund's Net Position to decrease by $21.4 million (11.6%), falling from $185.1 million in fiscal year 2024 to $163.7 million in fiscal year 2025.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

21 Airports

Airports' Fund set an all-time annual record for passenger levels with fiscal year 2025’s origin and destination passengers of 2.7 million, 5.1% higher than the prior fiscal year. In addition, the number of plane landings increased by 114.8%, going from 16,527 in fiscal 20 24 to 18,973 in fiscal year 2025. Th e Airport Fund's passenger performance continues to outpace other small hub airports in the Western Pacific Region. The increase in passengers also translated into an increase in non-airline revenues.

The increase in passenger traffic had an impact on Operating Revenues, which increased $5.1 million (12.7%) to $45.4 million. The overall increase in Operating Revenues was powered by increases in passenger driven and airline activity revenues, particularly Landing Fees, which rose to $8.0 million, a 47.3% increase from $5.4 million in the prior fiscal year. Operating Expenses increased by $6.8 million (17.8%), to a total of $ 44.8 million. The increase in Operating Expenses was mainly driven by an increase of $7.8 million (95.2%) in Contractual Services and a $1.1 million (10.49%) increase in Personnel Service expenses. The increase in Operating Expenditures was offset by a $4.3 million (28.7%) increase in Non-Operating Expenditures, mainly due to a decrease of $4.0 million (56.9%) in Interest Expense.

The increase in revenues and expenses ha d a predictable effect on Total Assets, which increased $41.0 million (9.9%) to $456.1 million. The overall increase in Total Assets was due to several factors:

• A $59.5 million (74.4%) increase in Construction in Progress, • A $12.7 million (24.8%) increase in Cash and Investments, • A $3.0 million (79.7%) increase in Accounts Receivable, Net. • A $23.8 million (23.5%) decrease in Restricted Cash, and • A $11.5 million (6.6%) decrease in Accumulated Depreciation

In addition to the increase in Total Assets, Airports experienced an increase in Total Liabilities, which rose $7.3 million (4.3%) to $174.7 million. This increase was primarily dr iven by a $4.2 million (33.7%) increase in Accounts payable compared to the prior year’s balance of $12.4 million. These increases were partia lly offset by a $3.9 million (2.7%) decrease in Long-Term Bonds Payable from the fiscal year 2024 balance of $144.2 million, due to the Airport Revenue Bonds 2023 A and B issued for the terminal expansion.

The net effect of these changes resu lted in the Total Net Position increasi ng by $34.8 million (14.6%), rising from $238.3 million in fiscal year 2024 to $273.1 million in fiscal year 2025.

Fresno Convention Center

Fresno Convention Center recorded $5.3 million of revenue in fiscal year 2025, a $0.66 million (1.2%) decrease from the fiscal year 2024 total of $5.4 million. Operating Expenditures increased in fiscal year 2025 to $8.7 million, up from $8.6 million in fiscal year 2024, an increase of $0.14 million (1 .6%). The rise in expenditures was driven primarily by a $0.11 million (3.8%) increase in Personnel Services and a $0.05 million (1.4%) increase in Contractual Services.

The Fresno Convention Center's Net Position increased from $5.5 million in fiscal year 2024 to $5.7 million in fiscal year 2025, reflecting a $0.15 million (2.8%) improvement. This growth was larg ely attributable to a $2.1 million (15.9%) reduction in Total Liabilities, mainly due to a $2.0 million decrease in Bonds Payable resulting from scheduled debt service payments. Total Assets decreased by $1. 9 million (10.5%) from the fiscal year 2024 balance of $18.9 million.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

22 Stadium

The Stadium Fund continued to build on the improvement in Net Position demonstrated in fiscal year 2024. Net Position increased from $12.1 million in fiscal year 2024 to $12.8 milli on in fiscal year 2025, an improvement of $0.7 million (5.6%). This improvement was driven by a decrease in Long-Term Debt of $2.3 million (14.7%) resulting from annual debt principal payments. This improvement was partially offset by a $0.89 million (3.1%) decrease in Capital Assets.

Internal Service Funds

The Net Position deficit in the Internal Service Funds grew by $8.6 million (7.9%) to $116.3 million in fiscal year 2025.

The increase in the Net Position deficit was primarily due to an increase of $20.7 million (9.4%) in the Short-Term and Long-Term (combined) Liability for Self-Insurance.

CAPITAL ASSETS AND DEBT ADMINISTRATION

Capital Assets

The City’s capital assets for its Governmental and Bu siness-Type Activities, before Component Units, as of June 30, 2025, amount to $2.99 billion (net of accumulated depreciation and amortization). Capital assets include land, buildings and improvements, machinery an d 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

1.6% (a 12.3% increase for Governmental Activities, a 1. 2% decrease for Business-Type Activities) as shown in the table below. Capital assets for the fiscal year ended June 30, 2024 amounted to $2.83 billion million (net of accumulated depreciation and amortization).

2024 2025 2024 2025 2024 2025
Land 298,236 $ 322,358 $ 53,503 $ 53,535 $ 351,739 $ 375,893 $ Intangibles (Indefinite Life) - - 21,629 21,629 21,629 21,629 Construction In Progress 165,494 306,326 170,859 258,427 336,353 564,753 Buildings and Improvements, Net 174,521 171,139 781,224 725,974 955,745 897,113 Machinery and Equipment, Net 98,811 101,904 31,535 52,147 130,346 154,051 Infrastructure, Net 395,551 368,439 616,847 584,497 1,012,398 952,936 Rig hts to Use Assets Being Amortized 15,169 20,115 2,466 1,910 17,635 22,025 Total 1,147,782 $ 1,290,281 $ 1,678,063 $ 1,698,119 $ 2,825,845 $ 2,988,400 $ Total
Government-Wide
Changes in Capital Assets, Net of Depreciation and Amortization Asset Categ ory
Governmental
Activities
Business-Type
Activities
(in thousands)

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

23 Major capital asset events during fiscal year 2025, some of which were in progress during the previous fiscal year, included the following:

† Downtown Redevelopment Grant Water and Sewer Improvements Project The Project will bring water and sewer facilities to cu rrent standards. The scope of work includes the replacement of 14,315 linear feet of water mains and 5,576 linear feet of sanitary sewer mains, including trenching, excavation, water and sewer service transfers, pavement restoration, re pair and reconstruction of existing improvements affected by the Project, and incidentals for complete construction. Additionally, the work includes the rehabilitation of the existing sewer and manhole facilities. Funding for this Project is provided by dollars received by the State of California for the Downtown Public Infrastructure Improvements Projects.

† FYI Terminal Expansion Project
The City’s Airport Department is currently in the Construction phase of expansion of over 116,000 square feet if terminal facility. This $150 million Terminal Expansion project, the largest in the history of the airport, is funded with $70 million in Airport Re venue Bonds with the balance coming from other sources including federal grants and passenger facility charges. The expa nsion project will result in a new terminal concourse with two jet bridge gates for domestic and international use, new concessions, and tenant facilities; new federal inspection service facility, with attached arrivals lobby and outdoor plaza; an expanded passenger screening checkpoint; and a new Checked Baggage Inspection Sy stem (CBIS). Construction is underway with an expected opening in Fall 2025.

† North Ave Sewer Trunk Main Realignment
The Department of Public Utilities, Wastewater Management Division worked to design and construct a realignment of the sewer main and repair to divert flow away from an extremely deteriorated section of sewer pipe. Work began on the Installation of a 66" sewer pi pe diversion on North Ave sewer trunk main between Cedar and Maple Avenues. Emergency work include d the installation of a sewer bypass facility, video inspections for assessing the feasibility of performing re pairs, obtaining railroad permits, and the construction repair. The project is designed to convey the flow thr ough a new pipe structure and allow for the replacement of the existing main and will run in parallel with another large diameter pipeline.

† Fire Station No. 12 Relocation Project

The City continued progress on the relocation and construction of the new Fire Station No. 12, a long-planned replacement for the temporary facility that has ser ved the area since 1977. The project consists of a 15,842-square-foot, single-story, wood-frame Fire Station No. 12. The facility will include four apparatus bays, turnout and equipment rooms, living quarters, recreat ion space, office space for 11 personnel, and a public lobby. It will be constructed on City -owned property at Ashlan Ave nue and Valentine Avenue in the northwestern area of the City. This new fire station w ill replace the existing Station No. 12 located at Acacia Avenue and Marks Avenue. The new facility will be significantly larger than the current station.

† 911 Emergency Call Center Project

The City is working towards constructing a new 911 Em ergency Call Center. The plan is to construct a new 12,072-square-foot 911 Emergency Call Center for the Police Department on a 1.25-acre project site located in the eastern portion of the City’s Municipal Service Center located at 1515 El Dorado Street. The 911 Emergency Call Center will consist of a single-story building with a large call center space, office space for managers and supervisors, a conference room, a training room, breakrooms, restrooms, an exercise and fitness room, a server room, an electrical room, and an outdoor courtyard. The 911 Emergency Call Center would be operational 24 hours a day, every day of the calendar year, and would be operated and maintained by the Police Department.

Operation of the 911 Emergency Call Center would i nvolve transferring certain existing operations from the police department. Design of the 911 Emergency Call Cent er is complete, and constr uction is expected to be completed Fall of 2026.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

24 At June 30, 2025, the City had commitm ents related to various construction projects associated with Governmental Activities totaling $87.8 million. Commitments connected w ith Business-Type Activities at fiscal year-end amounted to $149.0 million. The most significant of the Governmental Activities project was the Citywide Senior Center project ($27.1 million). The most significant of the Business-Type Activities projects were Phase 2 of the FYI Terminal Expansion ($48.3 million) and the Fire Station #12 Relocation project ($14.3 million). A complete list of projects appear in Note 13(F) - Commitments and Contingencies, page 162, under Construction and Other Significant Commitments.

Debt Administration

At the end of the current fiscal year, the City had total long-term bond obliga tions and notes and leases/subscriptions payable outstanding of $873.6 million. Of this amount, $72.3 million is obligati on bonds backed by the full faith and credit of the City, $654.7 million is revenue bonds and notes of the City’s business enterprises and $896 thousand are tax allocation debt issued by the Successor Agency of the Redevelopment Agency. The remaining $145.7 million includes lease revenue bonds, notes and capital leases for gene ral governmental projects. For detailed information on the City's debt, see Note 6-Long Term Liabilities, pages 101-113.

During fiscal year 2025, the City’s total bonded debt decreased by approximately $17 million. The decrease was due to normal debt service payments and a $4.5 million increase in capital financed purchases made during the year.

The City took the following actions in fiscal year 2025:

• Borrowed an additional $18.2 million through the Master Equipment Lease Purchase Agreement with Banc of America Public Capital Corp. in fiscal year 2025 for public safety vehicles. • The Sewer Division obtained $23.4 m illion in financing during fiscal year 2025 from Flagstar Funding Corp. to support energy-efficiency upgrades and critical infrast ructure improvements at the Wastewater Treatment Plant.

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 follows (as stated in thousands):

Fiscal Year
2025 2024 2023
General Bonded Debt (Par Amount) $55,400 $67,190 $78,255 General Bonded Debt per Capita $100.71 $122.84 $142.48
Debt Service Tax Rate per $100 Taxable Valuation $0.11 $0.14 $0.17

The City's outstanding general obligatio n bonds cannot exceed 20% of the assessed value of property within the City.

Although the City's Charter imposes a statutory limit on th e amount of general obligatio n bonds the City can have outstanding, the City also considers the potential impacts of all general obligation bonds on its tax base. Currently, there are no outstanding general obligation bonds.

Fitch’s May 3, 2024 upgrades of the City’s Lease Revenue Bond rating from A to AA and its General Obligation rating from A+ to AA remain in place, with bo th ratings continuing to hold a Stable outlook. Over the past year, Fitch has maintained its positive view of the City’s financial position. Similarly, Standard & Poor’s reaffirmation of the Airport bonds’ A rating on April 26, 2024 has remained unchanged throughout the year.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

25 The rating continues to be supported by an increase in enplanement performance, with passenger boardings rising from

2.4 million to 2.6 million, along with solid liquidity levels and a manageable debt burden. Over the past year, the City’s financial position remained positive, supported by ongoing development activity and continued economic diversification—particularly within lo gistics and fulfillment operations—which ar e expected to contribute to long-term revenue stability. The City’s long-term liability profile also remains strong, reinforced by low pension liabilities.

As of June 30, 2025
City's debt ratings by rating agencies

Moody's
Ratings
S&P Global
Ratings Fitch Ratings
Kroll Bond
Rating
Agency
Governmental Activities
General Obligation Bonds A1 AA- AA ---
Lease Revenue Bonds A2 A+ AA ---
Business-Type Activities
Airport Revenue Bonds A3 A BBB+ A+
Water Revenue Bonds A3 AA- A+ ---
Wastewater Revenue Bonds A1 AA+ AA ---

FINANCIAL OUTLOOK

The City continued to demonstrate solid performance desp ite ongoing uncertainties. Property taxes are a source of stable revenue generation a nd continue to show sustained growth. Si milarly, sales tax revenues show continued resilience despite economic challenges in the region. This performance is expected to carry over into fiscal year 2026, though the city acknowledges growing uncertainties remain.

While the local and national economic landscape remains uncer tain, the City's financial management practices will continue to remain crucial in maintaining stability. By employing disciplined financial policies such as implementing recurring cost controls, the City is poised to manage financial pressures well. The Fresno region has demonstrated strong foundational performance and continued e volution for support innovation and infrastructure, but it’s important to acknowledge risks remain. Risks associated with geopolitical tensions and federal policy are ever present and looming impacts exist for the region’s employment, housing and c onsumer spending activity. These conditions underscore the importance of prudent financial manage ment with a sound reserve management policy. The City concluded the 2025 fiscal year with a $47.6 million General Fund Emergency Reserve. This reserve provides a foundation for managing economic uncertainties and allows for a proactive response to unexpected fiscal challenges. The City's prudent approach to budgeting and planning ensures that it remains well-positioned to handle unforeseen economic shifts.

The City will continue to m onitor 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. As the national and local economies adjust to evolving conditions, the City remains committed to preserving its financial health, supporting its residents, and maintaining its status as a thriving and resilient city.

Fiscal year 2025 continued to reflect ongoing financial stability . While this is promising, there are still risks ahead.

Alongside the national economic challenges mentioned earlier, there are substantial geopolitical factors that pose risks to economic growth. These challenges are significant and will continue to play a key role in shaping future planning as the City works to ensure a high level of services for its residents.

City of Fresno
Management’s Discussion and Analysis (Unaudited) (Continued) For the Fiscal Year Ended June 30, 2025

26 REQUESTS FOR INFORMATION

This financial report is designed to pr ovide citizens, taxpayers, customers, i nvestors 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 co mpliant 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

BASIC FINANCIAL STATEMENTS
27 This page intentionally left blank.
28 GOVERNMENT-WIDE FINANCIAL STATEMENTS
29 Governmental Business-Type
Activities Activities Total
ASSETS
Current assets:

Cash and investments 385,040 $ 439,606 $ 824,646 $ Accounts receivables, net 33,045 59,395 92,440 Interest receivable 4,645 7,358 12,003 Lease receivable - current 603 1,643 2,246 Grants receivable 39,462 15,804 55,266 Intergovernmental receivable 59,965 17,085 77,050 Inventories and prepaid items 3,774 13,412 17,186 Internal balances 66,464 (66,464) - Total current assets 592,998 487,839 1,080,837 Noncurrent assets:

Restricted cash and investments 154,070 537,773 691,843 Restricted interest receivable - 949 949 Lease receivable - non-current 5,850 12,554 18,404 Loan, note, and other receivables, net - non-current 122,762 1,653 124,415 Property held for resale 3,126 - 3,126 Due from Fiduciary Fund 1,315 - 1,315 Net pension asset 276,338 71,252 347,590 Unamortized CVP water settlement - 879 879 Solid waste rate payers - 5,794 5,794 Other assets - 650 650 Capital assets:

Non-depreciable 628,684 333,591 962,275 Depreciable/amortizable, net 661,597 1,364,528 2,026,125 Total capital assets 1,290,281 1,698,119 2,988,400 Total noncurrent assets 1,853,742 2,329,623 4,183,365 Total assets 2,446,740 2,817,462 5,264,202

DEFERRED OUTFLOWS OF RESOURCES
Related to pensions 154,976 34,365 189,341 Related to OPEB 15,506 6,476 21,982 Total deferred outflows of resources 170,482 40,841 211,323

June 30, 2025
Statement of Net Position
City of Fresno
Primary Government
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 30 Governmental Business-Type
Activities Activities Total

LIABILITIES
Current liabilities:

Accounts payable 52,125 36,862 88,987 Salaries payable 17,908 4,704 22,612 Interest payable 2,056 4,455 6,511 Retention payable 6,281 6,933 13,214 Unearned revenue 120,066 54,495 174,561 Long-term liabilities - due within one year 99,485 32,903 132,388 Total current liabilities 297,921 140,352 438,273 Noncurrent liabilities:

Deposits held for others 19,426 24,117 43,543 Long-term liabilities - due in more than one year 588,931 674,542 1,263,473 Total noncurrent liabilities 608,357 698,659 1,307,016 Total liabilities 906,278 839,011 1,745,289

DEFERRED INFLOWS OF RESOURCES
Related to leases 6,050 15,219 21,269 Related to pensions 81,072 17,222 98,294 Related to OPEB 49,786 21,176 70,962 Total deferred inflows of resources 136,908 53,617 190,525

NET POSITION
Net investment in capital assets 1,273,621 1,021,386 2,295,007 Restricted:

General government 9,689 - 9,689 Public protection 10,023 - 10,023 Public ways and facilities 206,963 - 206,963 Culture and recreation 72,077 - 72,077 Community development 57,395 - 57,395 Debt service 2,412 - 2,412 Net pension asset 276,338 71,252 347,590 Total restricted 634,897 71,252 706,149 Unrestricted (deficit) (334,482) 873,037 538,555 1,574,036$ 1,965,675 $ 3,539,711 $ Total net position Primary Government
June 30, 2025
City of Fresno
Statement of Net Position (Continued)
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 31 Operating Capital
Charges for Grants an d Grants and
Functions/Programs Expenses Services Contributions Contributions Total Primary government:

Governmental activities:

General government 58,969$ 27,581 $ 1,450 $ 58,903 $ 87,934 $ Public protection 344,765 25,107 305 20,010 45,422 Public ways and facilities 77,644 34,315 87,734 67,735 189,784 Culture and recreation 89,147 2,096 1,400 2,530 6,026 Community development 81,272 15,284 10,188 36,105 61,577 Interest on long-term debt 11,399 - - - - Total governmental activities 663,196 104,383 101,077 185,283 390,743 Business-type activities:

Water system 127,689 131,153 236 4,054 135,443 Sewer system 81,819 78,806 - 3,285 82,091 Solid waste management 36,034 40,333 555 - 40,888 Transit 90,131 2,517 44,418 19,796 66,731 Airports 47,953 48,295 5,186 21,132 74,613 Fresno Convention Center 9,088 5,288 - - 5,288 Stadium 3,142 100 - - 100 Community sanitation 8,509 9,431 - - 9,431 Parks and recreation 472 486 - - 486 Total business-type activities 404,837 316,409 50,395 48,267 415,071 Total primary government 1,068,033$ 420,792 $ 151,472 $ 233,550 $ 805,814 $

City of Fresno
Statement of Activities
For the Year Ended June 30, 2025
Program Revenues
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 32 Governmental Business-Type
Functions/Programs Activities Activities Total
Primary government:

Governmental activities:

General government 28,965$ - $ 28,965$ Public protection (299,343) - (299,343) Public ways and facilities 112,140 - 112,140 Culture and recreation (83,121) - (83,121) Community development (19,695) - (19,695) Interest on long-term debt (11,399) - (11,399) Total governmental activities (272,453) - (272,453) Business-type activities:

Water system - 7,754 7,754 Sewer system - 272 272 Solid waste management - 4,854 4,854 Transit - (23,400) (23,400) Airports - 26,660 26,660 Fresno Convention Center - (3,800) (3,800) Stadium - (3,042) (3,042) Community sanitation - 922 922 Parks and recreation - 14 14 Total business-type activities - 10,234 10,234 Total primary government (272,453) 10,234 (262,219) General Revenues and Transfers:

General revenues:

Taxes:

Property taxes 192,854 - 192,854 Sales taxes - shared revenues 193,373 - 193,373 Franchise taxes 23,657 - 23,657 Business taxes 30,653 - 30,653 Room taxes 15,415 - 15,415 Other taxes 3,040 - 3,040 Total taxes 458,992 - 458,992 Investment income 24,098 51,591 75,689 Gain (loss) on sale of capital assets 1,330 19 1,349 Transfers (9,075) 9,075 - Total general revenues and transfers 475,345 60,685 536,030 Change in net position 202,892 70,919 273,811 Net Position:

Beginning of year 1,371,144 1,894,756 3,265,900 End of year 1,574,036$ 1,965,675 $ 3,539,711 $ For the Year Ended June 30, 2025
Statement of Activities (Continued)
City of Fresno
Net (Expense) Revenue
and Changes in Net Position
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 33 This page intentionally left blank.
34 FUND FINANCIAL STATEMENTS
35 This page intentionally left blank.
36 GOVERNMENTAL FUNDS FINANCIAL STATEMENTS
37 This page intentionally left blank.
38 Grants Non-major Total
General Special Revenue Governmental Governmental
Fund Fund Funds Funds
ASSETS
Cash and investments 48,045 $ 503 $ 261,658 $ 310,206 $ Restricted cash and investments 59,306 87,515 7,249 154,070 Accounts receivables, net 30,070 2,182 501 32,753 Interest receivable 734 934 2,120 3,788 Lease receivable 5,757 82 288 6,127 Grants receivable - 31,603 7,859 39,462 Intergovernmental receivable 44,324 - 15,641 59,965 Loan, note, and other receivables, net - 98,715 24,024 122,739 Inventories and prepaid items 384 14 70 468 Property held for resale - - 3,126 3,126 Due from other funds 2,747 - - 2,747 Advances to other funds - 420 - 420 Due from Fiduciary Fund - 1,315 - 1,315 Total assets 191,367$ 223,283 $ 322,536 $ 737,186 $

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES, AND FUND BALANCES
Liabilities:

Accounts payable 10,406 $ 22,977 $ 10,543 $ 43,926 $ Salaries payable 12,810 936 1,651 15,397 Retention payable 86 3,333 2,667 6,086 Deposits from others 19,389 6 31 19,426 Unearned revenue 5,655 108,119 432 114,206 Due to other funds - - - - Advances from other funds 616 - 263 879 Total liabilities 48,962 135,371 15,587 199,920

DEFERRED INFLOWS OF RESOURCES
Unavailable revenue 26,737 22,689 2,365 51,791 Related to leases 5,511 78 155 5,744 Total deferred inflows of resources 32,248 22,767 2,520 57,535

Fund Balances:

Nonspendable 384 14 3,196 3,594 Restricted - 65,131 268,374 333,505 Committed 54,224 - - 54,224 Assigned 21,902 - 32,859 54,761 Unassigned 33,647 - - 33,647 Total fund balances 110,157 65,145 304,429 479,731 Total liabilities, deferred inflows of
resources, and fund balances 191,367$ 223,283 $ 322,536 $ 737,186 $ Major Funds
(amounts in thousands)
Governmental Funds
Balance Sheet
City of Fresno
June 30, 2025
See accompanying Notes to the Basic Financial Statements. 39 Total Fund Balances - Total Governmental Funds 479,731$ Unavailable revenue recorded in the fund financial statements resulting from activities in which revenues were earned but funds were not available are reclassified as revenues in the Government-Wide Financial Statements. 51,791 Capital Assets used in the governmental activities were not financial resources and therefore were not reported in the Governmental Funds Balance Sheet.

Government-Wide Statement of Net Position 1,290,281
Less: amount reported in Internal Service Funds (151,420) Total capital assets 1,138,861
Long-term liabilities are not due and payable in the current period and therefore were not reported in the Governmental Funds Balance Sheet.

Bonds from public borrowings, net unamortized issuance premiums/(discounts) (145,684) Finance purchase agreements (70,307)
Compensated absences and health retirement arrangement (97,901) Total OPEB liability (67,458)
Lease and subscription liability (15,152)
Less: amounts reported in Internal Service Funds:

Finance purchase agreements 42,917
Compensated absences and health retirement arrangement 6,197 Total OPEB liability 1,682
Lease and subscription liability 2,871
Total long-term liabilities (342,835)
Prepaid bond insurance are not current financial resource. Therefore, they were not reported in the Governmental Funds Balance Sheet. 808
Interest payable on long-term debt did not require current financial resources. Therefore, interest payable was not reported as a liability in the governmental funds.

Government-Wide Statement of Net Position (2,056)
Less: amount reported in Internal Service Funds 420
Total interest payable (1,636)
Net pension asset used in the governmental activities were not financial resources and therefore were not reported in the Governmental Funds Balance Sheet.

Government-Wide Statement of Net Position 276,338
Less: amount reported in Internal Service Funds (9,908) Total net pension asset 266,430
Deferred outflows and inflows of resources related to OPEB and pensions are not available for current period and, therefore, are deferred in the governmental funds or not recorded in the governmental funds.

Deferred outflows of resources related to pensions 154,976 Deferred outflows of resources related to OPEB 15,506
Deferred inflows of resources related to pensions (81,072) Deferred inflows of resources related to OPEB (49,786)
Less: amounts reported in Internal Service Funds:

Deferred outflows of resources related to pensions (8,699) Deferred outflows of resources related to OPEB (1,138)
Deferred inflows of resources related to pensions 4,205 Deferred inflows of resources related to OPEB 5,302
Total deferred outflows and inflows of resources 39,294 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. (58,408)
Net Position of Governmental Activities 1,574,036$
Amounts reported for Governmental Activities in the Statement of Net Position were different because:

City of Fresno
Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position
(amounts in thousands)
June 30, 2025
See accompanying Notes to the Basic Financial Statements. 40 Grants Non-major Total
General Special Revenue Governmental Governmental
Fund Fund Funds Funds
REVENUES:

Taxes 406,388 $ - $ 107,170$ 513,558 $ Licenses and permits 9,699 - - 9,699 Intergovernmental 3,073 184,473 32,994 220,540 Charges for services 37,933 - 41,525 79,458 Fines, forfeitures and penalties 3,997 - 346 4,343 Use of money and property 7,261 25 13,142 20,428 Miscellaneous 1,835 364 550 2,749 Total revenues 470,186 184,862 195,727 850,775

EXPENDITURES:

Current:

General government 51,416 5,881 559 57,856 Public protection 298,282 44,268 4,683 347,233 Public ways and facilities 20,167 1,714 25,517 47,398 Culture and recreation 13,511 11,341 59,347 84,199 Community development 47,742 28,154 5,300 81,196 Capital outlay 18,398 69,073 73,647 161,118 Debt service:

Principal 8,538 631 17,940 27,109 Interest 1,502 40 8,611 10,153 Total expenditures 459,556 161,102 195,604 816,262

REVENUES OVER (UNDER) EXPENDITURES 10,630 23,760 123 34,513 OTHER FINANCING SOURCES (USES):

Proceeds from sale of property - - 1,311 1,311 Capital financing activity 19,574 - - 19,574 Transfers in 5,922 3,530 34,462 43,914 Transfers out (35,008) (4,754) (7,210) (46,972) Total other financing sources (uses) (9,512) (1,224) 28,563 17,827 NET CHANGE IN FUND BALANCES 1,118 22,536 28,686 52,340 FUND BALANCES:

Beginning of year 109,039 42,609 275,743 427,391 End of year 110,157 $ 65,145 $ 304,429 $ 479,731 $ (amounts in thousands)
Governmental Funds
Statement of Revenues, Expenditures, and Changes in Fund Balances City of Fresno
Major Funds
For the Year Ended June 30, 2025
See accompanying Notes to the Basic Financial Statements. 41 Net Change in Fund Balances - Total Governmental Funds 52,340$ Governmental funds reported capital outlay as expenditures. However, in the Government-Wide Statement of Activities and Changes in Net Position the cost of those assets was allocated over their estimated useful lives as depreciation expenses. This is the amount of capital assets recorded in the current period (net of $31,231 added in internal service funds) ($27,198 of the governmental fund additions were recorded as functional expenditures). 188,316 Depreciation and amortization expense on capital assets was reported in the Government-Wide Statement of Activities and Changes in Net Position, but they did not require the use of current financial resources. Therefore, depreciation and amortization expense, net of internal service funds of $24,183, was not reported as expenditures in the Governmental Funds. (49,093) The net effect of various miscellaneous transactions involving capital assets (i.e. sales, trade-ins, and donations) decreased net position (net of $3,738 reported in the internal services fund). (33) Issuance of long-term liabilities provides current financial resources to governmental funds, but the issuance increased long- term liabilities in the Government-Wide Statement of Net Position.

Finance purchase agreements (net of $8,329 reported in the internal services fund) (9,837) Lease and subscription liability (net of $5,916 reported in the internal services fund) (9,737) Repayment of long-term liabilities was an expenditures in governmental funds, but the repayment reduced long-term liabilities in the Government-Wide Statement of Net Position.

Principal payment of long-term debt 27,109
Amortization of bond premium 738
Interest expense on long-ter
m debt was reported in the Government-Wid e Statement of Activities, but it did not require the use of current financial resources. This amount represented the changes in accrued interest from prior year.

Prepaid bond insurance (99)
Interest payable 84
Compensated absences expenses reported in the Government-Wid e Statement of Activities do not require the use o f current financial resources and, therefore, are not reported as expenditures in the governmental funds. 858 Revenues that are not considered to be available are reported as unavailable revenues in the governmental funds, however, these amounts are recognized in the Government-Wide Statement of Activities. This amount represents the change in unavailable revenues. 782
Certain
pension expenses reported in the Government-Wid e Statement of Activities do not require the use o f current financial resources and therefore, are not reported as expenditures in governmental funds.

Changes in pension related deferred outflows of resources 29,902 Changes in net pension assets 39,380
Changes in pension related deferred inflows of resources (60,684) Certain OPEB expenses reported in the Government-Wid e Statement of Activities do not require the use o f current financial resources and therefore, are not reported as expenditures in governmental funds.

Changes in OPEB related deferred outflows of resources (2,924) Changes in total OPEB liabilities 10,054
Changes in OPEB related deferred inflows of resources (5,318) 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. (8,946)
Chan
ge in Net Position of Governmental Activities 202,892$ Amounts reported for Governmental Activities in the Statement of Net Position were different because:

City of Fresno
Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Government-Wide Statement of Activities and Changes in Net Position (amounts in thousands)
For the Year Ended June 30, 2025
See accompanying Notes to the Basic Financial Statements. 42 PROPIETARY FUNDS FINANCIAL STATEMENTS
43 Water Sewer Solid Waste
System System Management Transit Airports
Fund Fund Fund Fund Fund
ASSETS
Current assets:

Cash and investments 143,235 $ 202,087 $ 8,660 $ 104 $ 64,051 $ Accounts receivables, net 24,849 13,737 8,893 738 6,845 Interest receivable 3,822 1,519 121 374 1,286 Lease receivable 148 152 - - 1,020 Grants receivable 296 - 6 10,206 5,296 Intergovernmental receivable - 613 - 16,275 197 Inventories and prepaid items 4,534 5,946 - 1,626 1,144 Total current assets 176,884 224,054 17,680 29,323 79,839 Noncurrent assets:

Restricted cash and investments 331,947 70,599 6,936 45,048 77,641 Restricted interest receivable 278 671 - - - Lease receivable - non-current 1,258 2,024 - - 7,759 Other receivable 1,148 505 - - - Net pension asset 14,684 13,363 9,560 19,966 6,113 Unamortized CVP water settlement 879 - - - - Solid waste rate payers - - 5,794 - - Other assets - - - - 399 Advances to other funds 1,005 4,696 - - - Capital assets:

Land and intangibles 34,030 17,181 2,803 2,216 14,049 Buildings, systems and improvements 509,487 596,724 4,003 80,130 218,854 Machinery and equipment 1,487 6,250 5,699 112,957 5,583 Infrastructure 445,280 365,271 - - 89,404 Intangible assets, being amortized - 121 - - 3,135 Construction in progress 30,991 61,172 456 20,663 139,431 Less: accumulated depreciation and amortization (377,079) (446,178) (5,591) (95,260) (186,116) Total capital assets 644,196 600,541 7,370 120,706 284,340 Total noncurrent assets 995,395 692,399 29,660 185,720 376,252 Total assets 1,172,279 916,453 47,340 215,043 456,091

DEFERRED OUTFLOWS OF RESOURCES
Pension contributions 3,782 3,634 2,651 8,072 2,447 Related to pensions 1,841 1,772 1,268 3,886 1,140 Related to OPEB 1,038 957 720 2,374 560 Total deferred outflows of resources 6,661 6,363 4,639 14,332 4,147

June 30, 2025
Major Funds
(amounts in thousands)
City of Fresno
Statement of Net Position
Proprietary Funds
See accompanying Notes to the Basic Financial Statements. 44 Water Sewer Solid Waste
System System Management Transit Airports
Fund Fund Fund Fund Fund

LIABILITIES
Current liabilities:

Accounts payable 8,490 $ 4,719 $ 2,639 $ 2,702 $ 16,625 $ Salaries payable 761 695 511 1,742 483 Interest payable 465 262 - - 3,134 Retention payable 592 1,040 135 980 4,186 Unearned revenue 6,921 12,826 1,577 33,171 - Due to other funds - - - 93 - Compensated absences and HRA 471 375 402 730 422 Lease and subscription liabillity - 21 - - 649 Finance purchase agreement - 764 - - - Notes payable 12,442 2,657 - - - Bonds payable 4,260 - - - 3,523 Liability for self-insurance - - - - - Accrued closure cost - - 900 - - Total OPEB liability 126 120 77 251 61 Total current liabilities 34,528 23,479 6,241 39,669 29,083 Noncurrent liabilities:

Deposits held for others 966 17,070 - - 487 Advances from other funds - - 5,242 - - Pollution remediation obligation - - - - 220 Compensated absences and HRA 2,049 2,028 1,405 3,556 1,654 Lease and subscription liabillity - 20 - - 671 Finance purchase agreement - 22,536 - - - Notes payable 290,139 71,341 - - - Bonds payable 82,244 - - - 140,381 Accreted interest on capital appreciation bonds - - - - - Liability for self-insurance - - - - - Accrued closure cost - - 6,097 - - Total OPEB liability 4,494 4,302 2,753 8,960 2,172 Total noncurrent liabilities 379,892 117,297 15,497 12,516 145,585 Total liabilities 414,420 140,776 21,738 52,185 174,668

DEFERRED INFLOWS OF RESOURCES
Related to leases 3,195 2,996 2,213 5,627 2,189 Related to pensions 1,354 2,146 - - 8,419 Related to OPEB 3,260 2,991 2,458 7,881 1,843 Total deferred inflows of resources 7,809 8,133 4,671 13,508 12,451

NET POSITION
Net investment in capital assets 254,519 521,408 7,235 119,726 103,957 Restricted for net pension asset 14,684 13,363 9,560 19,966 6,113 Unrestricted (deficit) 487,508 239,136 8,775 23,990 163,049 Total net position 756,711$ 773,907 $ 25,570 $ 163,682 $ 273,119 $ June 30, 2025
Major Funds
City of Fresno
Statement of Net Position (Continued)
Proprietary Funds
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 45 Fresno Non-major Total Internal
Convention Stadium Enterprise Enterprise Service
Center Fund Fund Funds Funds Funds
ASSETS
Current assets:

Cash and investments 2,604 $ 959 $ 7,057 $ 428,757 $ 85,683 $ Accounts receivables, net 678 323 2,093 58,156 1,531 Interest receivable 6 1 40 7,169 1,046 Lease receivable - 84 239 1,643 9 Grants receivable - - - 15,804 - Intergovernmental receivable - - - 17,085 - Inventories and prepaid items 162 - - 13,412 2,498 Total current assets 3,450 1,367 9,429 542,026 90,767 Noncurrent assets:

Restricted cash and investments 1,458 3 1,864 535,496 2,277 Restricted interest receivable - - - 949 - Lease receivable - non-current - 1,006 507 12,554 317 Other receivable - - - 1,653 23 Net pension asset - - 3,812 67,498 13,662 Unamortized CVP water settlement - - - 879 - Solid waste rate payers - - - 5,794 - Other assets 113 127 11 650 - Advances to other funds - - - 5,701 - Capital assets:

Land and intangibles 4,163 710 12 75,164 - Buildings, systems and improvements 86,932 43,899 3,743 1,543,772 24,411 Machinery and equipment 309 2,782 67 135,134 217,762 Infrastructure - - 122 900,077 - Intangible assets, being amortized - - - 3,256 19,543 Construction in progress - 5,535 - 258,248 30,281 Less: accumulated depreciation and amortization (79,497) (25,235) (2,862) (1,217,818) (140,291) Total capital assets 11,907 27,691 1,082 1,697,833 151,706 Total noncurrent assets 13,478 28,827 7,276 2,329,007 167,985 Total assets 16,928 30,194 16,705 2,871,033 258,752

DEFERRED OUTFLOWS OF RESOURCES
Pension contributions - - 892 21,478 7,283 Related to pensions - - 466 10,373 3,930 Related to OPEB 10 - 280 5,939 1,675 Total deferred outflows of resources 10 - 1,638 37,790 12,888

Major Funds
City of Fresno
Statement of Net Position (Continued)
Proprietary Funds
June 30, 2025
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 46 Fresno Non-major Total Internal
Convention Stadium Enterprise Enterprise Service
Center Fund Fund Funds Funds Funds

LIABILITIES
Current liabilities:

Accounts payable 1,116 $ 96 $ 96 $ 36,483$ 8,578 $ Salaries payable - - 202 4,394 2,821 Interest payable 445 134 15 4,455 420 Retention payable - - - 6,933 195 Unearned revenue - - - 54,495 5,860 Due to other funds - - - 93 2,654 Compensated absences and HRA - - 72 2,472 931 Lease and subscription liabillity - - - 670 1,366 Finance purchase agreement - - - 764 6,021 Notes payable - - - 15,099 - Bonds payable 1,859 2,230 70 11,942 - Liability for self-insurance - - - - 50,719 Accrued closure cost - - - 900 - Total OPEB liability 2 - 30 667 105 Total current liabilities 3,422 2,460 485 139,367 79,670 Noncurrent liabilities:

Deposits held for others 596 - - 19,119 4,998 Advances from other funds - - - 5,242 - Pollution remediation obligation - - - 220 - Compensated absences and HRA - - 665 11,357 6,933 Lease and subscription liabillity - - - 691 1,505 Finance purchase agreement - - - 22,536 36,896 Notes payable - - - 361,480 - Bonds payable 5,172 13,845 1,238 242,880 - Accreted interest on capital appreciation bonds 2,010 - - 2,010 - Liability for self-insurance - - - - 241,195 Accrued closure cost - - - 6,097 - Total OPEB liability 66 - 1,090 23,837 3,733 Total noncurrent liabilities 7,844 13,845 2,993 695,469 295,260 Total liabilities 11,266 16,305 3,478 834,836 374,930

DEFERRED INFLOWS OF RESOURCES
Related to leases - - 1,002 17,222 306 Related to pensions - 1,063 876 13,858 5,566 Related to OPEB 20 - 878 19,331 7,147 Total deferred inflows of resources 20 1,063 2,756 50,411 13,019

NET POSITION
Net investment in capital assets 2,865 11,616 (226) 1,021,100 112,505 Restricted for net pension asset - - 3,812 67,498 15,939 Unrestricted (deficit) 2,787 1,210 8,523 934,978 (244,753) Total net position 5,652$ 12,826 $ 12,109 $ 2,023,576 (116,309) $ Adjustment to reflect the consolidation of internal
service funds activities related to enterprise funds (57,901) Net position of business-type activities 1,965,675 $
June 30, 2025
Major Funds
City of Fresno
Statement of Net Position (Continued)
Proprietary Funds
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 47 Water Sewer Solid Waste
System System Management Transit Airports
Fund Fund Fund Fund Fund
OPERATING REVENUES:

Charges for services 131,153 $ 78,806 $ 40,333 $ 2,517 $ 45,410 $ Total operating revenues 131,153 78,806 40,333 2,517 45,410 OPERATING EXPENSES:

Personnel services 15,507 15,817 14,170 45,531 11,628 Contractual services 36,663 16,948 7,373 15,043 14,789 Materials and supplies 12,650 8,492 1,136 8,433 1,033 Interdepartmental charges 13,454 9,230 12,062 11,163 5,164 Claims - - - - - Amortization - 74 - - 665 Depreciation 38,546 28,870 510 9,326 11,487 Total operating expenses 116,820 79,431 35,251 89,496 44,766

OPERATING INCOME 14,333 (625) 5,082 (86,979) 644 NONOPERATING REVENUES (EXPENSES):

Operating grants 236 - 555 44,418 5,186 Interest income 15,394 6,804 343 880 6,084 Net increase (descrease) in cash fair value 10,774 5,714 334 1,829 2,220 Interest expense (10,721) (2,181) (134) - (3,042) Passenger facility charges - - - - 6,052 Customer facility charges - - - - 2,885 Gain (loss) on sale of capital assets - 22 - (3) - Total nonoperating revenues (expenses) 15,683 10,359 1,098 47,124 19,385

INCOME BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS 30,016 9,734 6,180 (39,855) 20,029

CAPITAL CONTRIBUTIONS AND TRANSFERS
Capital contributions 4,054 3,285 - 19,796 15,080 Transfers in 924 1,176 2,487 7 - Transfers out (2,068) (1,840) (1,916) (1,357) (296) Total capital contributions and transfers 2,910 2,621 571 18,446 14,784 Changes in net position 32,926 12,355 6,751 (21,409) 34,813 NET POSITION:

Beginning of year 723,785 761,552 18,819 185,091 238,306 End of year 756,711 $ 773,907 $ 25,570 $ 163,682 $ 273,119 $ Major Fund
For the Year Ended June 30, 2025
Proprietary Funds
Statement of Revenues, Expenses, and Changes in Net Position (amounts in thousands)
City of Fresno
See accompanying Notes to the Basic Financial Statements. 48 Fresno Non-major Total Internal
Convention Stadium Enterprise Enterprise Service
Center Fund Fund Funds Funds Funds
OPERATING REVENUES:

Charges for services 5,288 $ 100 $ 9,917 $ 313,524 $ 276,770 $ Total operating revenues 5,288 100 9,917 313,524 276,770 OPERATING EXPENSES:

Personnel services 2,960 - 5,351 110,964 44,749 Contractual services 3,736 387 (211) 94,728 38,939 Materials and supplies - 448 512 32,704 18,942 Interdepartmental charges 3 - 2,943 54,019 13,709 Claims - - - - 143,940 Amortization - - - 739 5,201 Depreciation 2,021 1,376 189 92,325 18,989 Total operating expenses 8,720 2,211 8,784 385,479 284,469

OPERATING INCOME (3,432) (2,111) 1,133 (71,955) (7,699) NONOPERATING REVENUES (EXPENSES):

Operating grants - - - 50,395 165 Interest income 15 27 148 29,695 3,933 Net increase (descrease) in cash fair value - 29 83 20,983 1,570 Interest expense (368) (931) (48) (17,425) (1,969) Passenger facility charges - - - 6,052 - Customer facility charges - - - 2,885 - Gain (loss) on sale of capital assets - - - 19 52 Total nonoperating revenues (expenses) (353) (875) 183 92,604 3,751

INCOME BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS (3,785) (2,986) 1,316 20,649 (3,948)

CAPITAL CONTRIBUTIONS AND TRANSFERS
Capital contributions - - - 42,215 - Transfers in 3,940 3,669 4,447 16,650 1,965 Transfers out - - (1,510) (8,987) (6,570) Total capital contributions and transfers 3,940 3,669 2,937 49,878 (4,605) Changes in net position 155 683 4,253 70,527 (8,553) NET POSITION:

Beginning of year 5,497 12,143 7,856 (107,756) End of year 5,652 $ 12,826 $ 12,109 $ (116,309) $ Adjustment to reflect the consolidation of internal
service fund activities related to enterprise funds 392 Change in net position of business-type activities 70,919$ Major Fund
(amounts in thousands)
City of Fresno
Statement of Revenues, Expenses, and Changes in Net Position (Continued) Proprietary Funds
For the Year Ended June 30, 2025
See accompanying Notes to the Basic Financial Statements. 49 Water Sewer Solid Waste
System System Management Transit Airports
Fund Fund Fund Fund Fund
CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from customers 130,270 $ 83,885 $ 42,929 $ 9,197 $ 45,558 $ Cash payments to suppliers for goods and services (59,725) (34,890) (21,451) (43,868) (11,811) Cash payments to employees for services (17,945) (18,012) (15,808) (50,749) (15,025) Cash payments for claims and refunds - - - - - Net cash provided by (used in) operating activities 52,600 30,983 5,670 (85,420) 18,722

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Capital contributions 4,054 3,285 - 19,796 15,080 Passenger and customer facility charges - - - - 8,937 Interest payments on capital-related debt (10,659) (2,181) - - (3,485) Proceeds from issuance of capital-related debt - 23,474 - - 183 Principal payments on capital-related debt (16,375) (2,921) - - (4,327) Proceeds from sale of capital assets 432 80 48 274 13 Acquisition and construction of capital assets (20,119) (21,763) (2,801) (8,861) (57,116) Net cash (used in) capital and related financing activities (42,667) (26) (2,753) 11,209 (40,715) CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:

Operating grants received 148 262 549 44,196 3,275 Interest payments on noncapital-related debt - - (134) - - Interfund borrowing (lending) 949 995 1 12 - Repayment of interfund borrowing (lending) (626) (163) (2,306) (50) (62) Transfers in 924 1,176 2,487 7 - Transfers out (2,068) (1,840) (1,916) (1,357) (296) Net cash provided by noncapital financing activities (673) 430 (1,319) 42,808 2,917 CASH FLOWS FROM INVESTING ACTIVITIES:

Interest from investments 25,762 12,317 635 2,938 7,964 Net cash provided by investing activities 25,762 12,317 635 2,938 7,964 Net change in cash and cash equivalents 35,022 43,704 2,233 (28,465) (11,112) CASH AND CASH EQUIVALENTS:

Beginning of year 440,160 228,982 13,363 73,617 152,804 End of year 475,182 $ 272,686 $ 15,596 $ 45,152 $ 141,692 $

RECONCILIATION OF CASH AND CASH
EQUIVALENTS TO STATEMENT OF NET POSITION:

Cash and cash investments 143,235 $ 202,087 $ 8,660 $ 104 $ 64,051$ Restricted cash and investments 331,947 70,599 6,936 45,048 77,641 Total cash and cash equivalents 475,182$ 272,686 $ 15,596 $ 45,152 $ 141,692 $ City of Fresno
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2025
Major Funds
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 50 Water Sewer Solid Waste
System System Management Transit Airports
Fund Fund Fund Fund Fund

RECONCILIATION OF OPERATING INCOME (LOSS) TO NET
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:

Operating income (loss) 14,333 $ (625) $ 5,082 $ (86,979)$ 644 $ Adjustments to reconcile operating income to net
cash provided by operating activities:

Depreciation and amortization 38,546 28,944 510 9,326 12,152 Changes in operating assets and liabilities, and
deferred outflows and inflows of resources:

Accounts receivables, net (533) 883 (577) (394) (3,036) Lease receivable 201 (90) - - 1,931 Other receivable 8 82 - - - Inventories and prepaid items 283 579 - (271) (254) Net pension asset (1,513) (1,456) (1,042) (3,194) (965) Unamortized CVP water settlement (184) - - - - Solid waste rate payers - - 2,361 - - Other assets - - - - 27 Deferred outflows - pension related (753) (726) (498) (1,588) (609) Deferred outflows - OPEB related 217 203 135 480 114 Accounts payable 2,759 (799) 1,367 (8,958) 9,487 Salaries payable 129 73 56 136 90 Unearned revenue (2,026) 676 (338) 2,542 31 Deposits held for others - 1,848 - - 15 Pollution remediation obligation - - - - (58) Compensated absences and HRA 46 (37) (65) (152) 142 Liability for self-insurance - - - - - Accrued closure cost - - (2,247) - - Total OPEB liability (678) (603) (595) (1,643) (387) Deferred inflows - lease related 1,651 1,680 1,150 4,532 1,180 Deferred inflows - pension related (180) 117 - - (1,960) Deferred inflows - OPEB related 294 234 371 743 178 Total adjustments 38,267 31,608 588 1,559 18,078 Net cash provided by (used in) operating activities 52,600$ 30,983 $ 5,670 $ (85,420)$ 18,722 $ NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES:

Amortization of bond premium and discount 88 $ - $ - $ - $ (334)$ Borrowing under capital financing - $ 23,474$ - $ - $ - $ Change in unamortized CVP water settlment receivable/payable (184)$ - $ - $ - $ - $ Total noncash capital and related financing activities (96)$ 23,474$ - $ - $ (334)$ City of Fresno
Statement of Cash Flows (Continued)
Major Funds
Proprietary Funds
For the Year Ended June 30, 2025
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 51 Fresno Non-major Total Internal
Convention Stadium Enterprise Enterprise Service
Center Fund Fund Funds Funds Funds
CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from customers 4,945 $ 1,075 $ 11,026 $ 328,885 $ 264,929 $ Cash payments to suppliers for goods and services (3,266) (975) (3,520) (179,506) (70,142) Cash payments to employees for services (2,961) (358) (6,236) (127,094) (44,987) Cash payments for claims and refunds - - - - (118,700) Net cash provided by (used in) operating activities (1,282) (258) 1,270 22,285 31,100

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Capital contributions - - - 42,215 - Passenger and customer facility charges - - - 8,937 - Interest payments on capital debt (549) (1,104) (62) (18,040) (1,419) Proceeds from capital finance activity - - - 23,657 14,245 Principal payments on capital finance obligations (2,181) (2,100) (70) (27,974) (20,291) Proceeds from sale of capital assets - - - 847 3,790 Acquisition and construction of capital assets - (485) - (111,145) (31,438) Net cash (used in) capital and related financing activities (2,730) (3,689) (132) (81,503) (35,113) CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:

Operating grants received - - - 48,430 497 Interest payments on noncapital-related debt - - - (134) - Interfund borrowing (lending) - - - 1,957 3,833 Repayment of interfund borrowing (lending) - - (140) (3,347) (10,863) Transfers in 3,940 3,669 4,447 16,650 1,965 Transfers out - - (1,510) (8,987) (6,570) Net cash provided by noncapital financing activities 3,940 3,669 2,797 54,569 (11,138) CASH FLOWS FROM INVESTING ACTIVITIES:

Interest from investments 13 55 230 49,914 5,380 Net cash provided by investing activities 13 55 230 49,914 5,380 Net change in cash and cash equivalents (59) (223) 4,165 45,265 (9,771) CASH AND CASH EQUIVALENTS:

Beginning of year 4,121 1,185 4,756 918,988 97,731 End of year 4,062 $ 962 $ 8,921 $ 964,253 $ 87,960 $

RECONCILIATION OF CASH AND CASH
EQUIVALENTS TO STATEMENT OF NET POSITION:

Cash and cash investments 2,604 $ 959 $ 7,057 $ 428,757 $ 85,683 $ Restricted cash and investments 1,458 3 1,864 535,496 2,277 Total cash and cash equivalents 4,062$ 962 $ 8,921 $ 964,253 $ 87,960 $ Major Funds
City of Fresno
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2025
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 52 Governmental
Fresno Non-major Total Activities
Convention Stadium Enterprise Enterprise Internal
Center Fund Fund Funds Funds Service Funds

RECONCILIATION OF OPERATING INCOME (LOSS) TO NET
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:

Operating income (loss) (3,432) $ (2,111) $ 1,133 $ (71,955)$ (7,699) $ Adjustments to reconcile operating income to net
cash provided by operating activities:

Depreciation and amortization 2,021 1,376 189 93,064 24,190 Changes in operating assets and liabilities, and
deferred outflows and inflows of resources:

Accounts receivables, net (108) 602 281 (2,882) 1,739 Lease receivable - 371 465 2,878 6 Other receivable - - - 90 - Inventories and prepaid items 1 - - 338 464 Net pension asset - - (384) (8,554) (3,231) Unamortized CVP water settlement - - - (184) - Solid waste rate payers - - - 2,361 - Other assets 13 22 1 63 - Deferred outflows - pension related - - (302) (4,476) (3,020) Deferred outflows - OPEB related 2 - 60 1,211 330 Accounts payable 472 (140) (276) 3,912 984 Salaries payable - - (3) 481 521 Unearned revenue - (20) - 865 (13,372) Deposits held for others (248) - - 1,615 - Pollution remediation obligation - - - (58) - Compensated absences and HRA - - 102 36 870 Liability for self-insurance - - - - 25,240 Accrued closure cost - - - (2,247) - Total OPEB liability (3) - (168) (4,077) (1,198) Deferred inflows - lease related - - 362 10,555 (214) Deferred inflows - pension related - (358) (247) (2,628) 5,249 Deferred inflows - OPEB related - - 57 1,877 241 Total adjustments 2,150 1,853 137 94,240 38,799 Net cash provided by (used in) operating activities (1,282)$ (258) $ 1,270 $ 22,285 $ 31,100 $ NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES:

Amortization of bond premium and discount (168) $ (155) $ (14) $ (583) $ - $ Borrowing under capital financing - $ - $ - $ 23,474$ 14,245 $ Change in unamortized CVP water settlment receivable/payable - $ - $ - $ (184)$ - $ Total noncash capital and related financing activities (168)$ (155) $ (14) $ 22,707$ 14,245 $ City of Fresno
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2025
(amounts in thousands)
Major Funds
See accompanying Notes to the Basic Financial Statements. 53 This page intentionally left blank.
54 FIDUCIARY FUNDS FINANCIAL STATEMENTS
55 This page intentionally left blank.
56 Successor Agency
to the Fresno
Redevelopment Agency
Pension Private-Pur pose Custodial
Trust Funds Trust Fund Funds
ASSETS
Cash and investments 1,425 $ 1,810 $ 3,404 $ Restricted cash and investments held by fiscal agent - - 637 Total cash and investments 1,425 1,810 4,041 Receivables:

Receivables for investments sold 17,972 - - Interest and dividends receivable 4,125 - 25 Other receivables 2,170 - 5 Due from other governments - - 829 Total receivables 24,267 - 859 Investments, at fair value:

Short-term investments 19,557 - - Domestic equity 1,080,888 - - International equities 850,932 - - Private equity 342,135 - - Fixed income 544,053 - - Private debt/credit 523,907 - - Real estate 915,468 - - Multi-assets 88,934 - - Total investments 4,365,874 - - Collateral held for securities lent 48,148 - - Capital assets, net 152 - - Other assets 102 - - Property held for resale - 293 - Total assets 4,439,968 2,103 4,900

DEFERRED OUTFLOWS OF RESOURCES
Pension contributions - 70 - Related to pensions - 127 - Total deferred outflow of resources - 197 -

LIABILITIES
Accounts payable 19,687 160 - Salaries payable - 13 62 Interest payable - - - Collateral held for securities lent 48,148 - - Due to other governments - - 483 Other liabilities 2,315 - - Due to City - 1,315 - Long-term liabilities:

Due within one year - 103 - Due in more than one year - 871 - Net pension liability - 727 - Total liabilities 70,150 3,189 545

DEFERRED INFLOWS OF RESOURCES
Related to pensions - 40 - Total deferred inflow of resources - 40 -

NET POSITION
Restricted for pension benefits 4,369,818 - - Restricted for individuals, organizations,
and other governments - - 4,355 Held in trust for redevelopment dissolution - (929) - Total net position (deficit) 4,369,818$ (929) $ 4,355 $ City of Fresno
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2025
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 57 Successor Agency
to the Fresno
Redevelopment Agency
Pension Private-Purpose Custodial
Trust Funds Trust Fund Funds
ADDITIONS:

Contributions:

Employer 63,337$ - $ - $ System members 34,351 - - Total contributions 97,688 - - Investments income:

Net appreciation in fair value of investments 477,059 - - Interest 20,401 - - Dividends 13,420 - - Other investment related 166 - - Total investment income 511,046 - - Less: investment expense (71,050) - - Total net investment income 439,996 - - Securities lending income:

Securities lending earnings 3,488 - - Less: securities lending expense (3,259) - - Total net securities lending income 229 - - Property taxes - 1,115 - Fees collected for organizations and other governments - - 5,300 Taxes collected for organizations and other governments - - 200 Special assessments for organizations and other governments - - 632 Investment income - - 89 Other additions - 48 - Total additions 537,913 1,163 6,221 DEDUCTIONS:

Benefit payments (including post-retirement
supplemental benefits) 178,047 - - Refunds of contributions 3,133 - - General and administrative expenses 5,391 206 - Redevelopment expenses - 76 - Payments to individuals, organizations, and other governments - 10 5,722 Interest expense - 32 - Total deductions 186,571 324 5,722 Changes in net position 351,342 839 499 NET POSITION (DEFICIT):

Beginning of year 4,018,476 (1,768) 3,856 End of year 4,369,818$ (929) $ 4,355 $ City of Fresno
Statement of Changes in Fiduciary Net Position
Fiduciary Funds
For the Year Ended June 30, 2025
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 58 59

NOTES TO THE BASIC FINANCIAL STATEMENTS

60 This page intentionally left blank.

City of Fresno
Index of Notes to the Basic Financial Statements
For the Year Ended June 30, 2025

61 Page

Note 1 – Summary of Significant Accounting Policies ............................................................................................. 65

A. Financial Reporting Entity ......................................................................................................................... 65 B. Government-Wide and Fund Financial Statements ................................................................................... 65 C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation .................................... 66 D. Component Units ....................................................................................................................................... 69 E. Budgetary Data ................................................................................................................ .......................... 71 F. Deposits and Investments ........................................................................................................................... 72 G. Loans Receivable ....................................................................................................................................... 73 H. Inventories .................................................................................................................................................. 73 I. Former Redevelopment Agency Property Held for Resale ........................................................................ 73 J. Restricted Assets ........................................................................................................................................ 74 K. Capital Assets ............................................................................................................................................. 74 L. Bond Prepaid Insurance, Bond Premiums and Discounts and Accreted Interest Payable ......................... 75 M. Deferred Outflows of Resources ................................................................................................................ 75 N. Unearned Revenues .................................................................................................................................... 76 O. Deferred Inflows of Resources ................................................................................................. ................. 76 P. Interfund Transfers ..................................................................................................................................... 76 Q. Cash Flows ................................................................................................................................................. 76 R. Pensions ...................................................................................................................... ............................... 77 S. Other Post-Employment Benefits (OPEB) ................................................................................................. 77 T. Regulatory Assets and Liabilities ............................................................................................. ................. 77 U. Property Taxes ........................................................................................................................................... 77 V. Net Position ................................................................................................................................................ 78 W. Fund Balance .................................................................................................................. ........................... 78 X. Estimates .................................................................................................................................................... 80 Y. Implementation of New GASB Pronouncements for the Year Ended June 30, 2025 ................................ 81

Note 2 – Cash and Investments ................................................................................................. ................................. 81

A. City Cash and Investments ......................................................................................................................... 81 B. Investments Authorized by Debt Agreements ........................................................................................... 84 C. Types of Risk Associated with the Treasury Pool’s Investments .............................................................. 85 D. Investment in State Investment Pool .......................................................................................................... 89 E. Pension Trust (Retirement Systems) Deposits and Investments ................................................................ 89 F. Stewardship, Compliance and Accountability ........................................................................................... 91 G. Restricted Assets ........................................................................................................................................ 91

Note 3 – Receivables .................................................................................................................................................... 91

Note 4 – Capital Assets ................................................................................................................................................ 93

A. Citywide Capital Assets ............................................................................................................................. 93 B. Governmental Activities ............................................................................................................................ 94 C. Business-Type Activities ........................................................................................................................... 95 D. Fiduciary Funds ............................................................................................................... .......................... 96 E. Construction in Progress ............................................................................................................................ 96 City of Fresno
Index of Notes to the Basic Financial Statements (Continued) For the Year Ended June 30, 2025

62 Page

Note 5 – Leases and Subscription-Based Information Technology Arrangements ............................................... 97

A. Leases ......................................................................................................................................................... 97 B. Subscription-Based Information Technology Arrangements (SBITA) - GASB 96 ................................... 98 C. City as SBITA Service Receiver ................................................................................................................ 99 D. Discount Rate ............................................................................................................................................. 99 E. Variable Payments ..................................................................................................................................... 99 F. Regulated Leases ........................................................................................................................................ 99

Note 6 – Long-Term Liabilities ................................................................................................................................ 101

A. Summary of Long-Term Liabilities ......................................................................................................... 101 B. Debt Service Requirements (Excluding Capital Financing Activities) .................................................... 107 C. Debt Compliance................................................................................................................ ...................... 107 D. Debt Management Policy ......................................................................................................................... 107 E. Legal Debt Limit and Legal Debt Margin ................................................................................................ 108 F. Arbitrage .................................................................................................................................................. 108 G. Capital Financing Activities ..................................................................................................................... 108 H. General Fund Short-Term Borrowing Obligations .................................................................................. 111 I. Unused Lines of Credit ............................................................................................................................ 111 J. Debt Collateral ......................................................................................................................................... 111 K. Significant Events of Default, Termination and Subjective Acceleration Clauses .................................. 112

Note 7 – Defeasances .................................................................................................................................................. 113

Note 8 – Interfund Activity ....................................................................................................................................... 113

A. Due to/from Other Funds ......................................................................................................................... 113 B. Advances To and From Other Funds ....................................................................................................... 114 C. Transfers ..................................................................................................................... ............................. 116

Note 9 – Due from Fiduciary Fund .......................................................................................................................... 117

Note 10 – Risk Management Fund ........................................................................................................................... 118

Note 11 – Employee Benefit Programs ........................................................................................... ......................... 120

A. Retirement Plans ...................................................................................................................................... 120 B. Deferred Compensation Plan ................................................................................................................... 132 C. Compensated Absences ............................................................................................................................ 133 D. Termination Benefits ................................................................................................................................ 134 E. Health Benefit Plan .................................................................................................................................. 134 F. Other Post-Employment Benefits ............................................................................................................ 135 G. Healthcare Plan Claims Liability ............................................................................................................. 138

City of Fresno
Index of Notes to the Basic Financial Statements (Continued) For the Year Ended June 30, 2025

63 Page

Note 12 – No-Commitment Debt .............................................................................................................................. 139

Note 13 – Commitments and Contingencies ............................................................................................................ 139

A. Closure and Post-Closure Care Cost ........................................................................................................ 139 B. CVP Water Contract ................................................................................................................................ 139 C. Other Litigation ........................................................................................................................................ 140 D. Toxics Mitigation ..................................................................................................................................... 140 E. Measure Z, Zoo Accreditation, Fresno Chaffee Zoo Corporation ........................................................... 142 F. Construction and Other Significant Commitments .................................................................................. 143 G. Discolored Water ..................................................................................................................................... 143 H. City of Fresno Fire and Police Retirement System – Contribution Rate and Related Litigation ............. 144

Note 14 – Securities Lending .................................................................................................................................... 144

Note 15 – Other Information .................................................................................................................................... 145

Note 16 – Deficit Fund Equity .................................................................................................................................. 145

Note 17 – Net Investment in Capital Assets ............................................................................................................. 146

Note 18 – Subsequent Events .................................................................................................................................... 146

64 This page intentionally left blank.

City of Fresno
Notes to the Basic Financial Statements
For the Year Ended June 30, 2025

65 Note 1 – Summary of Significant Accounting Policies

The financial statements of the City of Fresno (City) have been prepared in conform ity 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 standa rd-setting body for establishing governmental accounting and financial reporting principles.

The more significant accounting policies of the City are described below.

A. Financial 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 presen t 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, alt hough legally separate entities, are substantia lly 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 th e 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 pro cess. Governmental Activities, which normally are supported by taxes and inter-governmental revenues, are reported separ ately from Business-Type Activities, which rely to a significant extent on fees and charges for support.

The Statement of Activities demonstrates the degree to whic h 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, serv1ices, 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 include d 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 establishe d for the purpose of accounting for specific activities in accordance with applicable regulations, restrictions, or lim itations. Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds (though the latter are excluded from the Government- Wide Financial Statements). Major individual governme ntal funds and major individual enterprise funds are reported by separate columns in the Fund Financial Statements.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

66 Note 1 – Summary of Significant Accounting Policies (Continued)

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.

Governmental Fund Financial Statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues ar e 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 measura ble and available only when the City receives cash. Expenditures gene rally are recorded when a liability is incurred. However, debt service, vacation, sick leave, claims and judgments expenditures are recorded only when paym ent is due. Prepaids are reported using the purchases method.

Major governmental funds of the City are outlined below:

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.

Major proprietary funds of the City are outlined below:

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, a nd 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 th e City's mass transportation service. Primary revenue sources are rider fares, federal grants, and state operating grants.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

67 Note 1 – Summary of Significant Accounting Policies (Continued)

C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation (Continued)

Major proprietary funds of the City are outlined below:

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 main tenance of the City’s baseball stadium.

Revenues are derived from the leasing of the facilities, supplemented by General Fund support.

Nonmajor governmental funds of the City are outlined below:

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 inte rest. 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.

Nonmajor proprietary funds of the City are outlined below:

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.

Internal Service Funds account for the financing of goods or ser vices 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 activiti es 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

68 Note 1 – Summary of Significant Accounting Policies (Continued)

C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation (Continued)

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 accounti ng used for fiduciary funds is much like that used for other Proprietary Funds.

The City Departmental and Special Purpose Fund account fo r 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. Custodial Fund Financial Statements use the economic resources measurement focus and the accrual basis of accounting. When both restricted and unrestri cted resources are available for use, it is the City’s policy to use restricted resources first, then unrestricted resources as they are needed.

Fiduciary funds of the City are outlined below:

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 acc ounted for in essentially the same manner as other Proprietary Funds. The City has the following Pension Trust Funds as of June 30, 2025.

 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 saf ety employees and retirees of the City. Fire and Police is maintained and governed by Articles 3 and 4 of Chap ter 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 appo inted by the Mayor, an elected police member, an elected fire member and a board-appointed member.

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 gene ral 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 bene fits. 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 fi nancial statements are prepared for the Employees Retirement System and may be obtained from the Re tirement 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 responsibiliti es 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

69 Note 1 – Summary of Significant Accounting Policies (Continued)

D. Component Units

In addition to the primary governmental unit, the City also has several component units whose functions are described below:

Blended Component Units

Although the following component units are legally sep arate 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 fi nancial 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 prim ary 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.

Fresno Joint Powers Financing Authority (Authority): The Authority, an independe nt public entity created in 1988, acquires telecommunications equipment, office furniture, and str eetlights; constructs facilities; and installs street improvements through the issuance of lim ited obligation bonds, certificates of participation and revenue bonds. The Authority currently is leasing these assets to the City. The Au thority’s three member governing board, consisting of the Mayo r and two Council Members, is responsible for the Authority’s fiscal and administrative decisions. The financial activity for th e Authority is included in the Financing Authorities and Corporations Debt Service Fund. All lease obligati ons 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 devel oping a revitalization policy and assisting with the downtown Fresno area development, redevelopment and renewal. The or ganization 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, mainta in, and rehabilitate a 118- unit low income multi-family comple x. 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

70 Note 1 – Summary of Significant Accounting Policies (Continued)

D. Component Units (Continued)

Blended Component Units (Continued)

The RDA and FRC Canyon Crest, LLC marketed the property for sale upon rehabilitation and stabilization to a qualified affordable housing de veloper for ongoing management and property improvements. In September 2011, the FRC and FRC Canyon Crest, LLC en tered 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.

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 exclusiv ely 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 th at will fund approximately $100 million (present value dollars) in multi-modal transportation, mobility, and re lated 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 2025 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.

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 comp rised 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
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

71 Note 1 – Summary of Significant Accounting Policies (Continued)

D. Component Units (Continued)

Fiduciary Component Unit (Continued)

In general, the Successor Agency’s assets can only be used to pay enforceable obl igations in existence at the date of dissolution (including the completion of any unfinish ed 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 Agen cy and has the sole legal authority to administer the former RDA’s housing assets. The City may move forward with completi ng projects under contract at the time of the dissolution and liquidate surplus real estate for the purpose of dist ributing 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 capac ity for others and cannot be used to support the City’s government’s own programs. The housing activity of the fo rmer RDA is presented within the Low and Moderate Income Housing Fund, a special revenue fund.

Separate financial statements are prepared for th e 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.

E. Budgetary Data

The budget of the City is a detailed operating plan which identifies estimated costs a nd results in relation to estimated revenues. The budget includes (1) programs, proj ects, 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.

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 fo r presentation of information to the public. Budget adoption and subsequent administration is carried out on a fund basis.

Basis of Accounting

The City adopts annual budgets for most governmental and business-type funds on the cash basis of accounting plus encumbrances. Major General Fund revenues, such as sales tax and property tax, are budgeted on the modified accrual basis of accounting. Supplemental appropriations dur ing the year must be approved by the City Council.

Budgeted amounts are reported as amended.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

72 Note 1 – Summary of Significant Accounting Policies (Continued)

E. Budgetary Data (Continued)

Basis of Accounting (Continued)

Encumbrances are commitments related to executed cont racts for goods or services. Encumbrance accounting is utilized for budgetary control and accountability and to f acilitate cash planning and control. Encumbrances outstanding at year-end are reported as part of restricted, committed, or assigned fund balance. As of June 30, 2025, encumbrances totaled $34.3 million in the General Fund, $92.9 million in the Grants Special Revenue Fund, and $81.3 million in the Non major Governmental Funds.

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 ta x (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 r eceive 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.

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 existe nce 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 disbursemen t. 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.

F. 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 c onsists of two components: 1) pooled deposits and investments and 2) dedicated investment funds. The de dicated 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
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

73 Note 1 – Summary of Significant Accounting Policies (Continued)

F. Deposits and Investments (Continued)

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 follow ing authorized investment instrumentalities: obligations of the U.S. Treasury, ag encies, 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 par ticipant’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.

G. Loans Receivable

For the purposes of the Fund Financial Statements, Speci al 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.

H. Inventories

Inventories recorded in the Proprietary Funds primarily consist of construction materials and maintenance supplies.

Generally, Proprietary Funds value inventory at cost or aver age cost. Inventory is expensed as it is consumed (the consumption method of inventory acc ounting). The City uses the purchases method of accounting for inventories in governmental fund types, where by inventory items are considered e xpenditures when purchased and are not reported in the balance sheet.

I. Former Redevelopment Agency Property Held for Resale

Property of the former RDA, some of which was allocat ed to Low and Moderate Income Housing (LMIH) ($3.1 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 Propert y Management Plan (LRPMP). The LRPMP addresses the anticipated disposition and use of the real properties of the former RDA. At J une 30, 2025, the adjusted value of the property was $3.4 million.

Property held for sale may, during the period it is held by th e 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

74 Note 1 – Summary of Significant Accounting Policies (Continued)

J. 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.

K. Capital Assets

Capital assets, which include land, buildings and improve ments, machinery and equipment, infrastructure, and intangible assets, are reported in the applicable Govern mental 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 A ssets, regardless of the acquisition cost of the land. All other acquisitions or construc tions (excluding Infrastructure) with an in itial 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 financing are capitalized in bulk and not on an individual basis.

Infrastructure with an initial cost of more than $50,0 00 is capitalized. Improvements that extend an asset’s life or efficiency by over 25% are also capitalized. Such assets are reco rded at historical cost or estimated historical cost if purchased or constructed unless they fall below the initial cost threshold.

Asset Category Capitalization Threshol d
Land All Lan d
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 receiv ed 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 Fu nds and as assets in the G overnment-Wide Financial Statements to the extent the City’s capitalization threshold is met. In prior years, inte rest 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 unde r finance purchase is included in depreciation and amortization.

Buildings and improvements, infrastructure, and machiner y 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:

Useful Life
Asset Category (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 exhi bition, 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

75 Note 1 – Summary of Significant Accounting Policies (Continued)

K. Capital Assets (Continued)

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 cons ists 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 2025, $21.6 million has been capitali zed as an intangible asset. Included in this amount are noise mitigation assets of $5.4 million and Water Rights in the amount of $16.2 million.

Capital Financing Activities

Property, plant and equipment include the following property held under finance purchase agreements at June 30, 2025 (in thousands):

Governmental
Activities
Machinery and equipment 251,776 $
Less: accumulated depreciation (202,397)
Machinery and equipment, net 49,379 $

L. 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, l ong-term debt and other long-term oblig ations are reported as liabilities in the applicable Governmental Activities, Business-Type Activities, or 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 th e applicable bond issuance premium or discount. Interest accrued on capital appreciation bonds is reported as accreted interest paya ble in the Proprietary Fund and as Long-Term Liabilities, Due In More Than One Year in the Government-Wide Statements.

M. Deferred Outflows of Resources

Pension and OPEB

In the Government-Wide Financial Statements and the Pr oprietary Fund type in the Fund Financial Statements, deferred outflows of resources are recorded for the current year employer pension contri butions to the retirement systems, which represent contributions made after th e measurement period in acco rdance with GASB Statement No. 71. For the OPEB plan, the employer contribution made after the measurement period is the implicit subsidy for the current fiscal year. Refer to Note 1 (R) and 1 (S) for additional information.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

76 Note 1 – Summary of Significant Accounting Policies (Continued)

N. Unearned Revenues

Unearned revenues arise when resources are received by the Ci ty before it has a legal claim to them (i.e., upfront grants or when the City bills certain fixed rate ser vices in advance). Amounts billed, but not yet earned, are amortized over the service period.

O. Deferred Inflows of Resources

The City records deferred inflows of resources in its G overnmental, 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, unamortized OPEB expense, and unamortized leases revenue.

In the governmental fund statements, the deferred inflows of resource unavailable revenue consists of revenue not collected within the availability pe riod after fiscal year-end. The deferred inflows of resources balance as of June 30, 2025 consists of the following unavailable revenue (in thousands):

Grants Non-major
General Special Revenue Governmental
Unavailable Revenue Fund Fund Funds Total
Property Taxes 2,540 $ - $ - $ 2,540$ Franchise Taxes 4,007 - - 4,007 Business Tax 5,351 - - 5,351 Measure C and Other Tax - - 2,365 2,365 Code Enforcement Revenue 10,326 - - 10,326 Fire Revenue 2,439 - - 2,439 Grant Revenue - 22,689 - 22,689 Parking Citations, Fines and Other Revenue Leases 2,074 - - 2,074 Total 26,737$ 22,689 $ 2,365 $ 51,791 $

P. 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:

- Charges for services are recorded as both revenues of th e 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.

- Reimbursements for expenditures initially made by one fund which are properly applicable to another fund are recorded both as expenditures in the reimbursing fund a nd as a reduction of expenditures in the fund that is reimbursed.

Q. Cash Flows

The Statements of Cash Flows are presented for Proprieta ry 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

77 Note 1 – Summary of Significant Accounting Policies (Continued)

R. Pensions

For purposes of measuring the net pension asset, deferred out flows/inflows of resources related to pensions and pension revenue/expense, information a bout the fiduciary net position of the C ity’s two pension plans, City of Fresno Employees Retirement System and the City of Fr esno 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 ear ned. The net appreciation in fair value of investments held by the Plans is recorded as an in crease to investment income based on th e valuation of investments at fiscal year-end, which includes both realized and unrealized ga ins and losses on investments. Retirement benefits and refunds are recognized when due and payable under the terms of the Plans.

S. Other Post-Employment Benefits (OPEB)

For purposes of measuring the net OPEB liability, deferre d outflows/inflows of resources related to OPEB, and OPEB revenue/expense, information about the fiduciar y 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.

T. Regulatory Assets and Liabilities

At June 30, 2025, the Statement of Net Position Business-Type Activities refl ected approximately $0.9 million in regulatory assets related to the Central Valley Project (C VP) 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 a nd 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.

U. 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 ma y 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 collect ed, adjusted for any amounts deemed uncollectible and amounts expected to be collected more than 60 days after the fiscal year.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

78 Note 1 – Summary of Significant Accounting Policies (Continued)

V. Net Position

The financial statements utilize a net position presentation. Net position is classified as follows:

Net Investment in Capital Assets - This category of net position consists of capital assets, net of accumulated depreciation and amortization, and reduced by any debt outstanding and any deferred outflows/inflows of resources related to such borrowings that are attributable to the acquisition, construction or im provement of those assets. If there are significant unspent related debt proceeds at yea r-end, the portion of the debt attributable to the unspent proceeds is not included in the calculation of net investment in capital assets. Rather, that portion of the debt is offset by unspent proceeds.

Restricted Net Position - This category presents restricted assets re duced by liabilities and deferred inflows of resources related to those assets. Those assets are restricted due to external restrictions imposed by creditors (such as through bond covenants), grantors or laws and regulations of other governments and restrictions imposed through constitutional provisions or enabling legislation.

Unrestricted - This category represents net position of the City that is not restricted for any project or other purpose.

When both restricted and unrestricted resources are available for use, the City’s policy is to use restricted resources first, then unrestricted resources that are needed.

W. Fund Balance

In the fund financial statements, fund balances of th e 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:

Nonspendable - Includes amounts that are either not in spendable form or are legally/contractually required to be maintained intact. These items include t hose not expected to be converted to cash, such as inventories, prepaid items, and certain long-term receivables.

Restricted - Includes amounts which have constraints placed on the use of the resources. The constraints are either externally imposed by creditors, gran tors, contributors, the le gally enforceable laws or regulations of other governments, or by the legally enforceable laws or enabling legislation of the government itself.

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 reser ve 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 al so defined several “qualifying events” under which the City’s Emergency Reserve could be used. Qualifying even ts 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

79 Note 1 – Summary of Significant Accounting Policies (Continued)

W. Fund Balance (Continued)

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, 2025, the Reserve balance identified as Committed Fund Balance was at $59.0 million, including $47.7 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 pr operty with proceeds greater than $15,000, which would otherwise be deposited into the General Fund, shall inst ead 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, 2025 includes $0.2 million within this fund.

In addition to the City's Emergency Reserve, the Committed Fund Balance as of June 30, 2025 also consists of $5.3 million designated exclusively for use in a year when a 27th 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 27th pay period is fiscal year 2028.

The Committed Fund Balance as of June 30, 2025 also includes $1.3 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.

Assigned - Includes amounts that are not classified as nonspend able, 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 h as delegated the authority to assign amounts for specific purposes.

Unassigned - The residual classification for fund balance, which includes all amounts not reported as nonspendable, restricted, committed, or assigned. The General Fund ma y report either a positive or negative unassigned fund balance. Unassigned amounts are available for any pur pose. 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. Other governmental funds may not report positive unassigned fund balances.

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
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

80 Note 1 – Summary of Significant Accounting Policies (Continued)

W. Fund Balance (Continued)

Fund Balances of the governmental funds at June 30, 2025 consisted of the following (in thousands):

Grants Non-major
General Special Revenue Governmental
Fund Fund Funds Total
Nonspendable
Inventories and prepaid items 384 $ 14 $ 70 $ 468 $ Property held for sale - - 3,126 3,126 Total nonspendable 384 14 3,196 3,594 Restricted
Debt Service - - 2,412 2,412 Fire - - 1,058 1,058 PARCS - - 68,870 68,870 Public Works - - 94,750 94,750 Police - 491 4,816 5,307 ARPA and Public Safety Grants - 7,715 - 7,715 Capital Projects and Community Revitalization Grants - 2,271 96,356 98,627 Planning and Development Grants - 54,654 112 54,766 Total restricte d - 65,131 268,374 333,505 Committe d
27th Pay Period Reserve 5,267 - - 5,267 Emergency Reserve General Fund 47,665 - - 47,665 Housing General Fund 1,292 - - 1,292 Total committe d 54,224 - - 54,224 Assigned
Animal Care 55 - - 55 Capital Projects - - 17,111 17,111 Economic Development - - 1,392 1,392 Fire - - 8,773 8,773 General Purpose 19,388 - 248 19,636 Ma yor a nd Ci ty Ma na g e r - - 187 187 Neighborhood and Community Service - - 248 248 PARCS - - 209 209 Personnel - - - - Police 140 - 5 145 Public Works 2,319 - 4,686 7,005 Total assigne d 21,902 - 32,859 54,761 Unassigned 33,647 - - 33,647 Total fund balances 110,157$ 65,145 $ 304,429 $ 479,731 $

X. Estimates

The preparation of financial statemen ts, in conformity with GAAP, requir es management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

81 Note 1 – Summary of Significant Accounting Policies (Continued)

Y. Implementation of New GASB Pronouncements for the Year Ended June 30, 2025

The requirements of the following accounting standards are effective for the purpose of implementation, if applicable to the City, for the year ended June 30, 20 25. The financial statements included herein apply the requirements and provisions of these statements, including necessary retroactive adjustments to financial statement classifications and presentations.

GASB Statement No. 101 – In June 2022, GASB issued Statement No. 101, Compensated Absences . The objective of this Statement is to better meet the information needs of financial statement users by updating the recognition and measurement guidance for compensated absences. That objective is achieved by aligning the recognition and measurement guidance under a unified model and by amending certa in previously required disclosures. Implementation of this Statement did not have a significant effect on the City's financial statements for the fiscal year ended June 30, 2025.

GASB Statement No. 102 – In December 2023, GASB issued Statement No. 102, Certain Risk Disclosures .

This Statement requires a government to assess whether a concentration or constraint makes the primary government reporting unit or other reporting units that report a liability for revenue debt vulnerable to the risk of a substantial impact. Additionally, this Statement requires a government to assess whether an event or events associated with a concentration or constraint that could cause the substantial impact have occurred, have begun to occur, or are more likely than not to begin to occur within 12 months of the date the financial statements are issued. Implementation of this Statement did not have a significant effect on the City's financial statements for the fiscal year ended June 30, 2025.

Note 2 – Cash and Investments

A. City Cash and Investments

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 Exch ange 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. Partic ipants’ 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 fina ncial 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, 2025 (in thousands):

Fiduciary
Governmental Business-Type Fund Financial
Activities Activities Total Statements Total
Cash and investments 385,040 $ 439,606 $ 824,646 $ 6,639 $ 831,285 $ Restricted cash and investments 154,070 537,773 691,843 637 692,480 Pension trust investments at fair value - - - 4,365,874 4,365,874 Collateral held for securities lent - - - 48,148 48,148 Total 539,110$ 977,379 $ 1,516,489 $ 4,421,298 $ 5,937,787 $ Government -Wide Statement of Net Position

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

82 Note 2 – Cash and Investments (Continued)

A. City Cash and Investments (Continued)

Cash, Deposits, and Investments

At year-end, the City's bank balance was $37.2 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, 2025 financial statements was $35.6 million. The difference is due to deposits in transit and outstanding checks.

Cash includes amounts in demand and time deposits. Inv estments 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.

Changes in fair value that occur dur ing a fiscal year are recognized as in come 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.

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 th at are observable for an asset or liability, either directly or indirectly. Inputs to th e valuation include prices that are b ased 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 lia bility 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 techni que in the application of GASB Statement No. 72. This method uses prices and other relevant information gene rated by market transactions involving identical or comparable assets or group of assets. Fair value is the pri ce that would be received to sell an asset in an orderly transaction between market participants at the measuremen t 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 logi c 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.

According to GASB Statement No. 72, money market inv estments 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 invest ment in LAIF is also not subject to the fair value hierarchy, as the amount available for withdrawal is based on the amortized cost.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

83 Note 2 – Cash and Investments (Continued)

A. City Cash and Investments (Continued)

Fair Value Hierarchy (Continued)

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, 2025 Level 1 Level 2 Federal Farm Credit Bank Bonds $ 63,826 $ - $ 63,826 Federal Home Loan Bank Bonds 169,345 - 169,345 Federal Home Loan Mortgage Corporation Bonds 33,808 - 33,808 Federal National Mortgage Association Bonds 19,862 - 19,862 Federal AG Mortgage Corporation 75,242 - 75,242 U.S. Treasury Securities 58,392 58,392 - Medium Term Corporate Notes 264,462 - 264,462 Negotiable Certificate of Deposit 24,710 - 24,710 Total pooled investments by fair value 709,647 58,392 651,255 Pooled investment not subject to the fair value hierarchy State Local Agency Investment Fund 81,193 Time Deposits 6,256
Municipal Bonds 130,811
Supranational 23,954
Money Market Funds 454,000
Total pooled investments not subject to the fair value hierarchy 696,214 Total pooled inv estments 1,405,861
Inv estments held outside the Treasurer's pool
not subject to the fair value hierarchy
Money Market Mutual Funds 30,944
30,944
Total inv estments held outside the Treasurer's pool 30,944 Grand total of investments $ 1,436,805
Fair Value Measurements Using

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 matu rity. A copy of the City’s current investment policy can be found at www.fresno.gov/finance/investmentpolicy.pdf.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

84 Note 2 – Cash and Investments (Continued)

A. City Cash and Investments (Continued)

Investments Authorized by the California Government Code and the City’s Investment Policy (Continued)

The table below identifies the investment types that are authorized for the City by the California Government Code and the City's investment policy. The table also identifies certain provisions of the California Government Code (or the City's investment policy, if more restrictive) that address interest rate risk and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustees that are governed by the provisions of debt agreements of the City, rather than the general pr ovisions of the California Government Code or the City's investment policy.

Minimum Maximum Maximum
Maximum Credit Percentage Investment
Authorized Investment Type Maturity Quality of Portfolio in One Issuer United States Treasury Bills, Bonds, Notes 5 years None 100% No Limit Federal Agency Obligations or U.S. Government-
Sponsored Enterprise Obligations (GSE) 5 years None 100% 25% M unicipal Securities 5 years A 30% 5%
Bankers' Acceptances 180 days A/A-1 or higher 40% 5%
Commercial Paper 270 days A/A-1 or higher 25% 5% (A)
Negotiable Certificates of Deposit (NCDs) 5 years A/A-1 or higher 30% (B) 5% Federally Insured Non - Negotiable Certificates
of Deposit 5 years None 20% (C) (D)
Collateralized Non-Negotiable Certificates of
Deposit 5 years None 20% (C) No Limit
Certificate of Deposit Placement Service (CDARS) 5 years None 30% (B) No Limit Repurchase Agreements 1 year None 100% 10%
Local Agency Investment Fund N/A None $75 million $75 million Local Government Investment Pools N/A None 100% No Limit Medium-Term Corporate Notes 5 years A 30% 5%
Asset -Backed, M ort gage-Backed, M ort gage Pass-
Through Securities, and Collaterized M ortgage
Obligations 5 years A/AA or higher 20% 5% (E)
Mutual Funds N/A Highest Category 20% 10%
Money Market Mutual Funds N/A Highest Category 20% 20%
Sup ranational Securities 5 years AA 30% 10%
(A) The City may purchase no more than 10% of the outstanding commercial paper of any single issuer. (B) Combined limit for NCD and CDARS.
(C) Combined limit for Federally Insured and Collateralized Non-Negotiable Certificates of Deposit. (D) The amount per institution is limited to the maximum covered under federal insurance. (E) No issuer limitation on any mortgage security where the issuer is the U.S. Treasury or a Federal Agency/GSE.

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 Gove rnment 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 acco rdance with the permitted investment provisions of the specific bond indentures, which are prep ared in accordance with numerous safeguards to reduce the risk associated with a provider’s ability to meet its contractual obligations.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

85 Note 2 – Cash and Investments (Continued)

B. Investments Authorized by Debt Agreements (Continued)

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 structur e 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. Du ring fiscal year 2025, total interest of $49.1 million was earned for the City’s investments.

C. Types of Risk Associated with the Treasury Pool’s Investments

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.

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.

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 Califor nia 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 No tes, 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):

Issuer Investment Type Amount % of Total
Treasurer's Pool Investments:

Federal Farm Credit Bank Bonds U.S. Government Agency $ 63,826 17.63 % Federal Home Loan Bank Bonds U.S. Government Agency 169,345 46.77 % Federal Home Loan Mortgage
Corporation Bonds U.S. Government Agency 33,808 9.34 % Federal National Mortgage Association U.S. Government Agency 19,862 5.49 % Federal AG Mortgage Corporation U.S. Government Agency 75,242 20.78 % $ 362,083 100.00 %
Treasurer's Pool Investments

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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

86 Note 2 – Cash and Investments (Continued)

C. Types of Risk Associated with the Treasury Pool’s Investments (Continued)

Concentration of Credit Risk (Continued)

One of the ways that the City manages its exposure to in terest 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 in terest rate risk inherent in its portfolio by measuring the weighted average maturity of its portfolio. The I nvestment 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.

Interest Rate Risk

Interest rate risk for the Treasurer’s Pool and for investme nts with trustees is disclosed in the following table. As of June 30, 2025, the City had the following cash and investments in its portfolio (in thousands):

More than 10
Treasurer’s Pool Fair Value Less than 1 Year 1 to 5 Years 5 to 10 Years Years Cash accounts $ 45,446
Treasurer’s Pool Investments
U.S. Government Agencies:

Federal Farm Credit Bank 63,826 $ 34,608 $ 29,218 $ - $ - Federal Home Loan Bank 169,345 55,445 113,900 - - Federal Home Loan Mortgage Corporation 33,808 9,780 24,028 - - Federal National Mortgage Association 19,862 19,862 - - - Federal AG Mortgage Corporation 75,242 4,918 70,324 - - Subtotal of U.S. Government Agencies 362,083 124,613 237,470 - - U.S. Treasury Securities 58,392 19,886 38,506 - - Medium Term Corporate Notes 264,462 36,202 228,260 - - Negotiable Certificate of Deposit 24,710 9,855 14,855 - - State Local Agency Investment Fund (CA LAIF) 81,193 81,193 - - - Time Deposits 6,256 6,256 - - - Municipal Bonds 130,811 41,700 89,111 - - Supranational 23,954 4,884 19,070 - - Money Market Mutual Funds 454,000 454,000 - - - Total Treasurer's Pool Investments 1,405,861 778,589 627,272 - - Investments held outside the Treasurer’s pool
Debt Service Funds/Bond proceeds:

Mutual Funds 30,944 30,944 - - - $ 30,944 $ 30,944 $ - $ - $ - Other deposits 46,964
Outstanding checks (5,833)
Deposits in transit 190
Petty cash 193
Pension trust assets (See Separate ACFRs) 4,414,022 Subtotal $ 4,455,536
Total cash and investments $ 5,937,787

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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

87 Note 2 – Cash and Investments (Continued)

C. Types of Risk Associated with the Treasury Pool’s Investments (Continued)

Default Credit Risk (Continued)

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:

Minimum Rating at Total Investment
Treasurer's Pool Investments Market Value Legal Rating Year End Portfolio U.S. Government Agency Securities:

Federal Farm Credit Bank $ 63,826 A AA+ 4.54 % Federal Home Loan Bank 169,345 A AA+ 12.05 % Federal Home Loan Mortgage Corporation 33,808 A AA+ 2.40 % Federal National Mortgage Association 19,862 A AA+ 1.41 % Federal AG Mortgage Corporation 75,242 A Unrated 5.35 % U.S. Treasury Securities 58,392 A Aaa 4.15 % Medium Term Corporate Notes:

Toyota Motor Credit Corp 4,882 A A+ 0.35 % JP Morgan Chase 4,865 A AA- 0.35 % Bank of America 4,854 A A- 0.35 % Bank of America 4,854 A A- 0.35 % Protective Life 4,894 A AA- 0.35 % Bank of America 4,821 A A- 0.34 % Bank of New York 4,847 A A 0.34 % Met Life Glob 4,832 A AA- 0.34 % Apple Inc 9,829 A AA+ 0.70 %
U.S. Bancorp 9,823 A A 0.70 %
Toyota Motor Credit Corp 9,813 A A+ 0.70 % New York Life 5,849 A AA+ 0.42 % Meta Platforms Inc 9,904 A AA- 0.70 % National Secs Clearing 5,116 A AA+ 0.36 % Massmutual Global Fund 10,203 A AA+ 0.73 % Toyota Motor Credit Corp 10,295 A A+ 0.73 % Guardian Life 9,328 A AA+ 0.66 % Northwestern Mutual Glbl 9,847 A AA+ 0.70 % Pacific Life 5,175 A AA- 0.37 %
Amazon.Com Inc 4,918 A AA 0.35 % Massmutual Global Fund 10,158 A AA+ 0.72 % JP Morgan Chase 10,004 A A 0.71 %
Emerson Electric Co 8,039 A A 0.57 % Athene Global Funding 1,200 A A+ 0.09 % Athene Global Funding 461 A A+ 0.03 % Massmutual Global Funding Ii 1,260 A AA+ 0.09 % Athene Global Funding 3,074 A A+ 0.22 % Bank of New York 4,986 A A 0.35 % Met Life Glob 4,832 A AA- 0.34 % New York Life Global Funding 2,034 A AA+ 0.14 % John Deere Capital Corp 1,769 A A 0.13 % Athene Global Funding 2,768 A A+ 0.20 % Met Life Global Funding I 1,015 A AA- 0.07 % National Australia Bank Lmtd NY 2,003 A AA- 0.14 % National Australia Bank Lmtd NY 1,327 A AA- 0.09 % National Australia Bank Lmtd NY 1,685 A AA- 0.12 % Guardian Life 1,183 A AA+ 0.08 % Guardian Life 1,654 A AA+ 0.12 % Bank of New York 2,991 A A 0.21 % Equitable Financial Life 3,737 A A 0.27 % John Deere Capital Corp 3,136 A A+ 0.22 % Protective Life 11,925 A AA- 0.85 % Jackson Natl Life Global Fundin 4,985 A A 0.35 % John Deere Capital Corp 5,121 A A 0.36 % American Honda Finance 7,207 A A- 0.51 % Protective Life 14,807 A AA- 1.05 % Massmutual Global Fund 12,152 A AA+ 0.86 % City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

88 Note 2 – Cash and Investments (Continued)

C. Types of Risk Associated with the Treasury Pool’s Investments (Continued)

Default Credit Risk (Continued)

Minimum Rating at Total Investment
Treasurer's Pool Investments Market Value Legal Rating Year End Portfolio Municipal Bonds:

Antelope Vally Union High 1,772 A Aa2 0.13 % County of Westchester NY 1,940 A AAA 0.14 % Chaffey Community College 2,818 A Aa1 0.20 % State of Hawaii 6,188 A AA+ 0.44 % State of California 9,685 A AA- 0.69 % Golden State Tobacco 1,951 A A+ 0.14 % Los Angles Unified School Dist 3,355 A Aa2 0.24 % State of New York 6,825 A AA+ 0.49 % Golden State Tobacco 6,147 A A+ 0.44 % University of California 8,800 A AA 0.63 % Los Angles Unified School Dist 13,860 A AA- 0.99 % Golden State Tobacco 8,909 A A+ 0.63 % Kern County CA Pension Obllg 14,915 A AA- 1.06 % Marin CA Cmnty Clg Dist 2,972 A Aaa 0.21 % Contra Costa CA Cmnty Clg Dist 2,692 A AA+ 0.19 % State of Hawaii 8,738 A AA+ 0.62 % State of Connecticut 9,953 A AA- 0.71 % State of Hawaii 4,513 A AA+ 0.32 % State of California 9,457 A AA- 0.67 % Chabot-Las Positas Calif Cmnty 948 A AA 0.07 % City of Los Angeles CA 1,139 A AA- 0.08 % California State University 3,234 A AA- 0.23 % Supranational:

Intl Bk Recon & Develop 4,883 AA AAA 0.35 % Intl Bk Recon & Develop 3,424 AA AAA 0.24 % Intl Bk Recon & Develop 5,706 AA AAA 0.41 % Intl Finance Corp 9,941 AA AAA 0.71 % Negotiable Certificate of Deposit: 24,710 N/A Unrated 1.76 % State Local Agency Investment Pool: 81,193 N/A Unrated 5.78 % Time deposits: 6,256 N/A Unrated 0.44 % Money Market Funds: 454,000 N/A Unrated 32.29 % Total treasurer's pool investments $ 1,405,861 100.00 % Investments with Trustees
Money Market Funds $ 30,944 N/A Unrated 100.00 % Total: $ 30,944 100.00 %
1Standard & Poor's rating of SP-1 indicates a strong capacity to pay princip al and interest. An issue determined to p ossess a very strong capacity to pay debt service is given a plus (+) designation.

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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

89 Note 2 – Cash and Investments (Continued)

C. Types of Risk Associated with the Treasury Pool’s Investments (Continued)

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 Govern ment 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 1 10% 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 co llateral pledged to cover the public fund deposits in California is held in the name of the California Collatera l Pool Administrator and is held in their name by the Federal Reserve Bank as custodian. The City had no uncollate ralized cash at June 30, 20 25. As of June 30, 2025, the City’s deposits with institutions in excess of fede ral depository insurance limits were $36.3 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, 2025 , 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 Yo rk Trust Company (BNY) as a third-party custody and safekeeping service for its investment securities. Custodial cr edit risk is the risk that the City will not be able to recover the value of its investments in the event of a B NY 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 participant in LAIF which is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. As of June 30, 2025, the City had $81,193,247 invested in LAIF. LAIF determines fair value on its investment portfolio based on market quotations for those securities where market quotations are readily available and based on amor tized cost or best estimate for those securities where market value is not readily available. LAIF is reported at amortized cost, which approximates fair value.

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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

90 Note 2 – Cash and Investments (Continued)

E. Pension Trust (Retirement Systems) Deposits and Investments (Continued)

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 Syst em'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 Fi xed Income, Direct Lending, and Real Estate. Any class may be held in direct form, pooled form, or both. The Systems have 15 external i nvestment managers, managing 19 individual portfolios.

Investments at June 30, 2025 consist of the following (in thousands):

Domestic equities $ 1,080,888
International equities 850,932
Private equity 342,135
Fixed income 544,053
Private debt/credit 523,907
Real estate 915,468
Multi-assets 88,934
Short-term investments 19,557
Total investments at fair value $ 4,365,874 Inv estments at Fair Value

Both Retirement Boards have established policies for inves ting, specifying the following target allocations with a minimum and maximum range for each of these asset classes:

Asset Class Minimum Target Maximum
Domestic equities 15.0% 22.5% 36.0%
International equities 10.0% 18.0% 25.0%
Private equity 0.0% 6.5% 10.0%
Core fixed income 5.0% 13.0% 20.0%
Private debt/credit 5.0% 14.0% 20.0%
Core real estate 5.0% 9.0% 15.0%
Non-core real estate 2.0% 6.0% 8.0%
Infrastructure 2.0% 7.0% 10.0%
Alternative credit 0.0% 4.0% 7.0%
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’ classifi cation 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 Sy stems are also exposed to cr edit risk and market risk associated with their derivatives invest ments. 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
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

91 Note 2 – Cash and Investments (Continued)

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. Rest ricted interest receivable is interest earned with the trustee.

Restricted assets are reported in the following funds at June 30, 2025 (in thousands):

Cash and
Investments
Current and Interest
Noncurrent Receivable Total
Governmental activities:

General Fund 59,306 $ - $ 59,306$ Grants Special Revenue Fund 87,515 - 87,515 Nonmajor Governmental Funds 7,249 - 7,249 Internal Services Funds - - - Subtotal 154,070 - 154,070 Business-type activities:

Water System Fund 331,947 278 332,225 Sewer System Fund 70,599 671 71,270 Solid Waste Management Fund 6,936 - 6,936 Transit Fund 45,048 - 45,048 Airports Fund 77,641 - 77,641 Convention Center Fund 1,458 - 1,458 Stadium Fund 3 - 3 Nonmajor Enterprise Funds 1,864 - 1,864 Internal Service Funds 2,277 - 2,277 Subtotal 537,773 - 538,722 Fiduciary:

Custodial Funds 637 - 637 Subtotal 637 - 637 Total 692,480$ - $ 693,429$

Note 3 – 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, 2025 were $7.4 million for the General Fund, $0.1 million for Water System, $0.1 million for Sewer System, $0.1 million for Solid Waste Management, $0.5 million for Airports, and $0.1 million for Other Enterprise Funds. The uncollectible account s related notes receivables at June 30, 2025 were $8.2 million for Grants Special Revenue Fund and $ 1.8 million for Other Governmental Funds. Accounts not scheduled for collection during the subsequent year are $121.8 million for Governmental notes and loans and $8.9 million for Business-Type notes and loans.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

92 Note 3 – Receivables (Continued)

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, pa rticularly in the near term. The amount of the allowance for each fund is a determination made by mana gement 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.

Receivables, net of amounts uncollectible, (in thousands) as of June 30, 2025 were as follows:

Loan, Note ,
Accounts Interest Lease Grants Property and Other
Receiv able Receiv able Receiv able Receiv able Taxes Other Receiv able Total Gove rnme ntal Acti vi ti e s:

General Fund 30,070$ 734 $ 5,757 $ - $ 4,914$ 39,410 $ - $ 80,885$ Grants Special Revenue Fund 2,182 934 82 31,603 - - 98,715 133,516 Nonmajor Governmental Funds 501 2,120 288 7,859 - 15,641 24,024 50,433 Internal Services Funds 292 857 326 - - - 23 1,498 Subtotal 33,045 4,645 6,453 39,462 4,914 55,051 122,762 266,332 Business-Type Activities:

Water System Fund 24,849 4,100 1,406 296 - - 1,148 31,799 Sewer Sy stem Fund 13,737 2,190 2,176 - - 613 505 19,221 Solid Waste M anagement Fund 8,893 121 - 6 - - - 9,020 Transit Fund 738 374 - 10,206 - 16,275 - 27,593 Airports Fun d 6,845 1,286 8,779 5,296 - 197 - 22,403 Convention Center Fund 678 6 - - - - - 684 Stadium Fund 323 1 1,090 - - - - 1,414 Nonmajor Enterprise Funds 2,093 40 746 - - - - 2,879 Internal Service Funds 1,239 189 - - - - - 1,428 Subtotal 59,395 8,307 14,197 15,804 - 17,085 1,653 116,441 Total 92,440$ 12,952 $ 20,650 $ 55,266 $ 4,914 $ 72,136 $ 124,415 $ 382,773 $ Intergov ernmental Receiv able

Receivables are presented on the Statement of Net Position as follows (in thousands):

Governmental Business-Type
Activities Activities Total
Accounts receivables, net $ 33,045 $ 59,395 $ 92,440 Interest receivable 4,645 8,307 12,952 Lease receivable 6,453 14,197 20,650 Grants receivable 39,462 15,804 55,266 Intergovernmental receivable 59,965 17,085 77,050 Loan, note, and
other receivables, net 122,762 1,653 124,415 Total $ 266,332 $ 116,441 $ 382,773

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

93 Note 4 – Capital Assets

A. Citywide Capital Assets

The following is a summary of capital assets as of June 30, 2025 (in thousands):

Governmental Business-Type Fiduciary
Activities Activities Funds Total
Capital assets, not being depreciated
Land 322,358 $ 53,535 $ - $ 375,893$ Intangibles, indefinite life - 21,629 - 21,629 Construction in progress 306,326 258,427 - 564,753 Total capital assets, not being depreciated 628,684 333,591 - 962,275 Capital assets, being depreciated
Building and improvements 373,537 1,543,897 - 1,917,434 Machinery and equipment 257,581 135,255 2,997 395,833 Infrastructure 1,552,890 900,077 - 2,452,967 Intang ible assets
Lease assets 18,183 121 - 18,304 Subscription assets 24,341 3,135 - 27,476 Total capital assets, being depreciated 2,226,532 2,582,485 2,997 4,812,014 Accumulated depreciation: - -
Building and improvements (202,398) (817,923) - (1,020,321) Machinery and equipment (155,677) (83,108) (2,845) (241,630) Infrastructure (1,184,451) (315,580) - (1,500,031) Intang ible assets
Lease assets (6,052) (44) - (6,096) Subscription assets (16,357) (1,302) - (17,659) Total accumulated depreciation (1,564,935) (1,217,957) (2,845) (2,785,737) Total capital assets, being depreciated, net 661,597 1,364,528 152 2,026,277 Total capital assets, net 1,290,281$ 1,698,119 $ 152 $ 2,988,552$

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

94 Note 4 – Capital Assets (Continued)

B. Governmental Activities

Capital asset activity related to governmental activities fo r the fiscal year ended June 30, 2025 was as follows (in thousands):

Balance Balance
July 1, 2024 Additions Deletions Transfers June 30, 2025 Capital assets, not being depreciated:

Land 298,236 $ 24,122 $ - $ - $ 322,358$ Construction in progress 165,494 146,797 (33) (5,932) 306,326 Total capital assets, not being depreciated 463,730 170,919 (33) (5,932) 628,684 Capital asse ts, being depre ciate d:

Building and improvements 365,082 8,455 - - 373,537 M achinery and equipment 236,705 24,519 (5,124) 1,481 257,581 Infrastructure 1,548,439 - - 4,451 1,552,890 Intang ible assets
Lease assets 9,275 9,001 (93) - 18,183 Subscription assets 18,068 6,652 (379) - 24,341 Total capital assets, being depreciated 2,177,569 48,627 (5,596) 5,932 2,226,532 Accumulated depreciation:

Building and improvements (190,561) (11,837) - - (202,398) Machinery and equipment (137,918) (19,146) 1,387 - (155,677) Infrastructure (1,152,864) (31,587) - - (1,184,451) Intang ible assets
Lease assets (3,665) (2,480) 93 - (6,052) Subscription assets (8,509) (8,227) 379 - (16,357) Total accumulated depreciation (1,493,517) (73,277) 1,859 - (1,564,935) Total capital assets, being depreciated, net 684,052 (24,650) (3,737) 5,932 661,597 Total capital assets, net 1,147,782$ 146,269 $ (3,770) $ - $ 1,290,281$

Depreciation/Amortization was charged to functions/funds as follows (in thousands):

General government 11,364 $
Public protection 3,229
Public ways and facilities 30,273
Culture and recreation 4,183
Community development 44
Internal service funds 24,184
Total depreciation/amortization
expense ‐ governmental activities 73,277$
City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

95 Note 4 – Capital Assets (Continued)

C. Business-Type Activities

Capital asset activity related to Business-Type Activities for the fiscal year ended June 30, 2025 was as follows (in thousands):

Balance Balance
July 1, 2024 Additions Deletions Transfers June 30, 2025 Capital assets, not being depreciated:

Land 53,503 $ 32 $ - $ - $ 53,535$ Intangibles, indefinite life 21,629 - - - 21,629 Construction in progress 170,859 104,941 (1,405) (15,968) 258,427 Total capital assets, not being depreciated 245,991 104,973 (1,405) (15,968) 333,591 Capital assets, being depreciated:

Building and improvements 1,533,698 2,946 - 7,253 1,543,897 M achinery and equipment 120,115 6,720 (295) 8,715 135,255 Infrastructure 900,077 - - - 900,077 Intangible assets
Lease assets 717 - (596) - 121 Subscription assets 2,952 183 - - 3,135 Total capital assets, being depreciated 2,557,559 9,849 (891) 15,968 2,582,485 Accumulated depreciation:

Building and improvements (752,474) (52,583) - (12,866) (817,923) M achinery and equipment (88,580) (7,412) 18 12,866 (83,108) Infrastructure (283,230) (32,350) - - (315,580) Intangible assets
Lease assets (552) (74) 582 - (44) Subscription assets (651) (651) - - (1,302) Total accumulated depreciation (1,125,487) (93,070) 600 - (1,217,957) Total capital assets, being depreciated, net 1,432,072 (83,221) (291) 15,968 1,364,528 Total capital assets, net 1,678,063$ 21,752 $ (1,696) $ - $ 1,698,119$

Depreciation/Amortization was charged to funds as follows (in thousands):

Water System Fund 38,546 $
Sewer System Fund 28,944
Solid Waste Management Fund 510
Transit Fund 9,326
Airports Fund 12,152
Convention Center Fund 2,021
Stadium Fund 1,376
Nonmajor Enterprise Funds 189
Internal Service Funds 6
Total depreciation/amortization
expense ‐ business-t ype activities 93,070$
City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

96 Note 4 – Capital Assets (Continued)

D. Fiduciary Funds

Capital asset activity related to fiduciary funds for the fiscal year ended June 30, 2025 was as follows (in thousands):

Balance Balance
July 1, 2024 Additions Deletions Transfers June 30, 2025 Capital assets, being depreciated:

Machinery and equipment 3,207 $ - $ (210)$ - $ 2,997$ Total capital assets, being depreciated 3,207 - (210) - 2,997 Accumulated depreciation:

Machinery and equipment (2,573) (272) - - (2,845) Total accumulated depreciation (2,573) (272) - - (2,845) Total capital assets, net 634$ (272) $ (210) $ - $ 152 $

Depreciation was charged to functions as follows (in thousands):

Fire & Police Retirement System Pension Trust Funds 136 $ Employee Retirement System Pension Trust Funds 136
Total depreciation/amortization
expense ‐ fiduciary funds 272$

E. Construction in Progress

At June 30, 2025, Construction in Progress consisted of the following (in thousands):

Construction
Project Title Cost To Date
Gove rnme ntal Acti vi ti e s:

Neighborhood improvements 4,147 $
Parks improvements 30,236
Public protection 7,752
Public works improvements 234,088
Other miscellaneous projects 30,103
Subtotal 306,326
Business-Type Activities:

Water capital projects 30,991
Sewer/wastewater capital projects 61,172
Transit capital projects 20,663
Airports capital projects 139,431
Stadium capital projects 5,535
Other capital projects 635
Subtotal 258,427
Total construction in progress 564,753$

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

97 Note 5 – Leases and Subscription-Based Information Technology Arrangements

A. Leases

The accounts for leases in accordance with GASB Statement No. 87, which re quires the recognition of a lease liability and an intangible right-to-use (RTU) asset for l ease agreements. The City con tinues to account for lease agreements under these guidelines, recognizing leases as financings of the right-to-use underlying assets.

As a lessee, the City has entered into various lease agreements for land, buildings, and other properties, with lease terms expiring between 2025 and 2065. These agreements do not contain variable payments or guaranteed residual values. In fiscal year 2025, the City recognized lease liabilities and corresponding intangible right-to-use assets for the value of leased assets and the obligations to make future lease payments. Short-term leases (12 months or less) are excluded from the lease liabilities and recognized as outflows of resources (expenditures) in the period incurred.

The City has accounted for any renewal options based on th e likelihood of their exercise, where renewal periods that are reasonably certain to be exercised are included in the lease term.

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):

Year Ending
June 30, Principal Interest Principal Interest
2026 1,828 $ 319 $ 21 $ 1 $ 2027 1,452 261 20 - 2028 1,317 217 - - 2029 1,230 183 - - 2030 1,294 148 - - 2031-2035 2,419 441 - - 2036-2040 861 292 - - 2041-2045 809 212 - - 2046-2050 1,056 108 - - 2051-2054 428 15 - - Total 12,694$ 2,196 $ 41 $ 1 $ Governmental Activities Business-Type Activities

As a lessor, the City recognizes a lease receivable and a de ferred inflow of resources at the commencement of the lease term, excluding regulated leases subject to external laws or regulations, such as aviation leases. The City continues to follow GASB 87’s guidelines, recognizing re venue from both fixed and variable lease payments (excluding usage-based variables). The lease receivable is measured at the present value of expected payments during the lease term.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

98 Note 5 – Leases and Subscription-Based Information Technology Arrangements (Continued)

A. Leases (Continued)

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):

Year Ending
June 30, Principal Interest Principal Interest
2026 603 $ 152 $ 1,643 $ 103 $ 2027 638 146 1,338 100 2028 496 123 1,233 84 2029 378 113 737 76 2030 229 106 565 71 2031-2035 1,268 451 2,895 304 2036-2040 1,228 303 2,445 217 2041-2045 1,242 148 2,152 154 2046-2050 371 14 381 107 2051-2055 - - 297 75 2056-2060 - - 331 41 2061-2065 - - 180 6 Total 6,453$ 1,556 $ 14,197 $ 1,338 $ Governmental Activities Business-Type Activities

In fiscal year 2025, the City recognized $3.9 million in am ortization expense related to its lease agreements. The City’s leases include agreements with various organizations, such as the New Towers Radio Hut and Carlulu LLC, for governmental purposes. For business purposes, signifi cant agreements include the DHL Building and the Loperena Antenna Site. As of June 30, 2025, the balance of the deferred infl ow of resources related to leases was $19.9 million.

B. Subscription-Based Information Technology Arrangements (SBITA) - GASB 96

In fiscal year 2025, the City recognized significant subscr iption expense as part of the ongoing SBITA contracts.

The City has ensured that variable payments (based on usage) are exclude d from the SBITA liability calculation, and prepaid amounts are properly recognized as part of the subscription asset. In addition, the City recognizes Subscription-Based Information Technology Arrangements (SBITAs) in accordance with GASB Statement No. 96.

SBITA liabilities and intangible right-to-use (RTU) subscription assets are recognized at the commencement of the subscription term, with the liabilities measured as the present value of subscription payments expected to be made during the subscription term. If not explicitly stated in the contract, the City's incremental borrowing rate (IBR) is used for discounting the liability.

The City’s SBITA agreements include Tyler Technologies, Soundthinking, Inc., and Dell, with terms expiring in fiscal year 2027. These agreements are non-cancellable and include fixed, prepaid, and fixed-in-substance components. The City has recognized corresponding subscription liabilities and intangible RTU subscription assets in accordance with GASB 96, with amortization of the assets on a straight-line basis over the shorter of the subscription term or the useful life of the underlying IT systems.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

99 Note 5 – Leases and Subscription-Based Information Technology Arrangements (Continued)

C. City as SBITA Service Receiver

The City recognizes a subscription liability and an intangible RTU subscription asset at the beginning of an SBITA unless it is considered a short-term SBITA. A subscription liability is measured at the present value of subscription payments expected to be made during the subscription term using the City's incremental borrowing rate. The City's SBITA contracts have terms expiring through 2028.

A subscription asset is amortized on a straight-line basis over the shorter of the subscription term or the useful life of the underlying subscription asset. Remeasurement of subscr iption liability occurs when there is a change in the subscription term and/or other changes that are likely to have a significant impact on the subscription liability.

Variable payments based on the usage of the underlyi ng assets are not included in the subscription liability calculations but are recognized as outflows of resources in the period in which the obligation was incurred.

As of June 30, 2025, the City's SBITA RTU subscr iption assets are $27.5 million with accumulated amortization of $17.7 million, while the City's principal and interest requirements to maturity for the SBITA liability are as follows (in thousands):

Year Ending
June 30, Principal Interest Principal Interest
2026 2,458 $ 76 $ 649 $ 38 $ 2027 - - 671 19 Total 2,458$ 76 $ 1,320$ 57 $ Governmental Activities Business-Type Activities

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 en d of each fiscal year. As of June 30, 2025, the City's incremental borrowing rate was 2.21%. This was the discount rate utilized for applicable leases reported in fiscal year 2025.

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. 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 Transpor tation and the Federal Aviation Administration, regulated aviation leases between airports and air carriers and other aeronautical users.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

100
Note 5 – Leases and Subscription-Based Information Technology Arrangements (Continued)

F. Regulated Leases (Continued)

During the year ended June 30, 2025, the City recognized the following related to its regulated lease agreements (in thousands):

Year Ending
June 30, Principal Interest Total
Airlines:
2026 130 $ - $ 130 $
2027 65 - 65
Airlines total 195$ - $ 195 $ General Aviation
2026 864 $ - $ 864 $
2027 864 - 864
2028 764 - 764
2029 264 - 264
2030 264 - 264
2031-2035 1,307 - 1,307 2036-2040 1,043 - 1,043 2041-2045 861 - 861
2046-2050 244 - 244
General Aviation total 6,475$ - $ 6,475$ Government:
2026 173 $ - $ 173 $
2027 173 - 173
2028 173 - 173
2029 173 - 173
2030 174 - 174
2031-2035 217 - 217
Government total 1,083$ - $ 1,083$ Real Estate:
2026 764 $ - $ 764 $
2027 127 - 127
Real Estate total 891$ - $ 891 $ Total 8,644$ - $ 8,644$

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

101
Note 6 – 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, 2025 (in thousands):

Governmental Business-Type Fiduciary
Activities Activities Funds Total
Long-Te rm De bt:

Bonds from public borrowings 139,495 $ 218,457 $ - $ 357,952$ Bonds from direct placements - 30,974 - 30,974 Accreted interest - 2,010 - 2,010 Issuance premiums/(discounts) 6,189 5,391 - 11,580 Notes payable from direct borrowings - 376,579 896 377,475 Finance purchase agreements 70,307 23,300 - 93,607 Total long-term debt 215,991 656,711 896 873,598 Other L ong-Term L iabilities:

Compensated absences and
health retirement arrangement 97,901 15,496 78 113,475 Total OPEB liability 67,458 26,660 - 94,118 Liabilities for self-insurance 291,914 - - 291,914 Accrued closure cost - 6,997 - 6,997 Pollution remediation - 220 - 220 Lease and subscription liability 15,152 1,361 - 16,513 Total other long-term liabilities 472,425 50,734 78 523,237 Due within one year 99,485 32,903 103 132,491 Due in more than one year 588,931 674,542 871 1,264,344 Total long-term liab ilities 688,416$ 707,445 $ 974 $ 1,396,835$ Primary Government

Internal service funds (ISFs), except for Utility Billing a nd 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 claims/j udgments 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
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

102
Note 6 – Long-Term Liabilities (Continued)

A. Summary of Long-Term Liabilities (Continued)

Balance Balance Due within Due in More
July 1, 2024 Additions Reductions June 30, 2025 One Year Than One Year Gove rnme ntal Acti vi ti e s:

Bonds Payable from Public Borrowings:

Lease Revenue Bonds, Series 2004 7,650 $ - $ (1,110)$ 6,540 $ 1,180 $ 5,360 $ Taxable Pension Obligation Bonds
Refunding, Series 2002 67,190 - (11,790) 55,400 12,560 42,840 Lease Revenue Bonds 2017A, City Hall Refunding,
Fresno Bee Building, Granite Park, Improvements 14,155 - (1,805) 12,350 1,865 10,485 Lease Revenue Bonds, Series 2017A Parks Projects 18,240 - (930) 17,310 975 16,335 Lease Revenue Bonds, Series 2017A, Police
and Fire/Public Safety 25,360 - (1,175) 24,185 1,235 22,950 Lease Revenue Bonds, Series 2017A Various 8,880 - (695) 8,185 - 8,185 Lease Revenue Bonds, Series 2020A, Animal Svcs 15,960 - (435) 15,525 455 15,070 Total bonds payable from public borrowings 157,435 - (17,940) 139,495 18,270 121,225 Unamortized issuance premiums/(discounts) on bonds 6,927 - (738) 6,189 - 6,189 Finance purchase agreements 64,832 18,166 (12,691) 70,307 10,941 59,366 Total long-term debt 229,194 18,166 (31,369) 215,991 29,211 186,780 Other L ong-Term L iabilities:

Compensated absences
health retirement arrangement* 97,547 354 - 97,901 13,177 84,724 Net OPEB liability 78,378 7,288 (18,208) 67,458 2,092 65,366 Liabilities for self-insurance 266,674 145,840 (120,600) 291,914 50,719 241,195 Lease and subscription liability 16,268 15,653 (16,769) 15,152 4,286 10,866 Total other long-term liabilities 458,867 169,135 (155,577) 472,425 70,274 402,151 Total long-term liabilities 688,061$ 187,301 $ (186,946) $ 688,416 $ 99,485 $ 588,931 $ * - The change in compensated absences and health retirement arrangement above is a net change for the year.

Classification

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

103
Note 6 – Long-Term Liabilities (Continued)

A. Summary of Long-Term Liabilities (Continued)

Balance Balance Due within Due in More
July 1, 2024 Additions Reductions June 30, 2025 One Year Than One Year Business-T ype Activities:

Bonds Payable from Public Borrowings:

Water System Revenue Bonds and
(Taxable BABs) 2010 A-2 91,340 $ - $ (4,090)$ 87,250 $ 4,260 $ 82,990 $ Lease Revenue Bonds 1998, Exhibit Hall
Expansion Project 901 - (199) 702 189 513 Lease Revenue Bonds 2001 A and B, Stadium Project 9,785 - (1,130) 8,655 1,210 7,445 Airport Revenue Bonds 2007 - Cons. Rental Car 18,880 - (645) 18,235 725 17,510 Airport Revenue Bonds 2023 A & B, Terminal
Expansion & Federal Inspection Station 91,085 - (1,620) 89,465 1,915 87,550 Lease Revenue Bonds 2017A, Exhibit Hall
Expansion Project 6,060 - (1,095) 4,965 1,155 3,810 Lease Revenue Bonds 2017A - Convention Center 1,545 - (490) 1,055 515 540 Lease Revenue Bonds 2017A, Stadium Project 7,895 - (970) 6,925 1,020 5,905 Lease Revenue Bonds 2017A - Riverside Golf Course 1,275 - (70) 1,205 70 1,135 Total bonds payable from public borrowings 228,766 - (10,309) 218,457 11,059 207,398 Bonds Payable from Direct Placements:

Airport Revenue Bonds 2019 - Airport Parking 31,830 - (856) 30,974 883 30,091 Accreted interest on capital appreciation bonds 2,407 154 (551) 2,010 - 2,010 Unamortized issuance premiums/(discounts) on bonds 5,973 96 (678) 5,391 - 5,391 Finance purchase agreements - 23,474 (174) 23,300 764 22,536 Notes Payable from Direct Placements:

Construction of Water Supply Disinfection Buildings 837 $ - $ (104)$ 733 $ 105 $ 628 $ Improvements on the Enterprise and Jefferson Canals 535 - (66) 469 68 401 Water Meter Project 25,703 - (2,570) 23,133 2,570 20,563 Southeast S urface Water Treatment Facility 149,501 - (4,982) 144,519 5,065 139,454 Tertiary Treatment Facility 25,297 - (1,034) 24,263 1,044 23,219 Northeast Surface Water Treatment Facility 12,770 - (380) 12,390 383 12,007 Friant-Kern Canal Raw Water Pipeline 17,900 - (617) 17,283 627 16,656 Regional Transmission Mains 59,268 - (1,899) 57,369 1,929 55,440 Kings River Pipeline 48,352 - (1,667) 46,685 1,694 44,991 Southwest Quadrant Recycled
Water Distribution System 51,333 - (1,598) 49,735 1,614 48,121 Total notes payable from direct placements 391,496 - (14,917) 376,579 15,099 361,480 Total long-term debt 660,472 23,724 (27,485) 656,711 27,805 628,906 Other L ong-Term L iabilities:

Compensated absences and
health retirement arrangement* 14,790 706 - 15,496 2,802 12,694 Net OPEB liability 31,071 2,942 (7,353) 26,660 726 25,934 Accrued closure cost 9,244 - (2,247) 6,997 900 6,097 Pollution remediation 279 - (59) 220 - 220 Lease and subscription liability 2,498 183 (1,320) 1,361 670 691 Total other long-term liab ilities 57,882 3,831 (10,979) 50,734 5,098 45,636 Total lon g-term liabilities 718,354$ 27,555 $ (38,464) $ 707,445 $ 32,903 $ 674,542 $ * - The change in compensated absences and health retirement arrangement above is a net change for the year.

Classification

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

104
Note 6 – Long-Term Liabilities (Continued)

A. Summary of Long-Term Liabilities (Continued)

Balance Balance Due within Due in More
July 1, 2024 Additions Reductions June 30, 2025 One Year Than One Year Fiduciary Funds:

Successor Agency to the Fresno
Redevelopment Agency:

Notes payable from dire ct place me nts:

California Infrastructure Bank 979 $ - $ (83)$ 896 $ 86 $ 810 $ Total notes payable from direct placements 979 - (83) 896 86 810 Other L ong-Term L iabilities:

Compensated absences* 67 16 (5) 78 17 61 Total other long-term liabilities 67 16 (5) 78 17 61 Total long-term liabilities 1,046$ 16 $ (88) $ 974 $ 103 $ 871 $ * - The change in compensated absences above is a net change for the year.

Classification

The following is a description of Long-Term Debt, Ex cluding Capital Financing Obligations, Leases and Subscription-based Information Technology Arrangements, which had activity in 2025 (in thousands):

Issuance Net FY 2025
Rate Issue Maturity Annual Outstanding Disc/(Prem) / Principal Payments Debt Service Debt Series Purpose Range Date Date Note Principal Principal Accreted Int Due to Maturity Payment Governmental
Bonds from public borrow
Taxable Pension Obligation
Bonds 2002
$205,335
tax able
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. During 2025 $13,710 was used from
General Fund and $2,481 was used from Enterprise Funds and Internal Service Funds to make the 2025 debt service payment of $16,191.
$12,560 to
$15,195
55,400$ - $ 55,400$ 64,759 $ 16,191 $ Fresno Joint Powers
Financing Authority: Lease
Financing Refunding 2017 B,
Bee Bldg & Granite Park
B =
$21,980
tax able
Fresno Bee Building and
Granite Park

3.48%
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 2025. $1,865 to
$2,270
12,350 - 12,350 14,181 2,364 Fresno Joint Powers
Financing Authority: Lease
Revenue Bonds 2004 C,
Convention Center Parking
Garage
C =
$28,870
tax able
Convention Center
Parking Garage

5.90% 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 $1,528 was equal to debt service in 2025. $1,180 to
$1,400
6,540 3 6,543 7,538 1,528 Fresno Joint Powers
Financing Authority: Lease
Revenue Refunding Bonds
2017 A, Convention Center
Parking Garage
A =
$12,435
tax -ex empt
Refinance Convention
Center Parking Garage

5.00% 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 $1,139 was equal to debt service in 2025. $40 to
$1,785
8,185 811 8,996 11,491 1,139 Fresno Joint Powers
Financing Authority: Lease
Revenue Refunding Bonds
(Parks Projects) 2017 A,
Parks Impact Fee Projects
A =
$22,965
tax -ex empt
Refinance Improvements
to Various Park Facilities

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.

Lease revenue of $1,820 was equal to debt service in 2025. $975 to
$1,755
17,310 1,459 18,769 23,670 1,820 Fresno Joint Powers
Financing Authority: Lease
Revenue Refunding Bonds
2017 A, Police and Fire/Public
Safety
A =
$32,065
tax -ex empt
Refinance Public Safety
Capital Improvement
Projects (Police & Fire)

5.00% 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 $2,386 was equal to debt service in 2025. $1,235 to
$2,300
24,185 1,931 26,116 33,422 2,386 Fresno Joint Powers
Financing Authority: Lease
Revenue Bonds 2020 A,
Animal Services Facility
A =
$17,145,00
0 tax -ex empt
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 $1,121 was equal to debt service in 2025. $435 to
$1,075
15,525 1,985 17,510 23,509 1,121 Revenue and other bonds total 139,495 6,189 145,684 178,570 26,549 Governmental total 139,495 6,189 145,684 178,570 26,549 City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

105
Note 6 – Long-Term Liabilities (Continued)

A. Summary of Long-Term Liabilities (Continued)

Issuance Net FY 2025
Rate Issue Maturity Annual Outstanding Disc/(Prem) / Principal Payments Debt S ervice Debt S eries Purpose Range Date Date Note Principal Principal Accreted Int Due to Maturity Payment Business-Type
Revenue and Other Bonds
Fresno Joint Powers
Financing Authority: Lease
Revenue Refunding Bonds
2017 A, Convention Center
A = $4,260
tax -ex empt
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 2025 the City chose to make these lease payments from the General Fund in the amount of $567, which was
equal to debt service in 2025. 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. $515 to
$540
1,055 41 1,096 1,135 567 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 2025, 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
$189
702 1,995 2,697 3,000 750 Fresno Joint Powers
Financing Authority: Lease
Revenue Refunding Bonds
2017 A, Exhibit Hall
Expansion Project Refunding
A =
$11,665
tax -ex empt
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 $1,398, which was equal to debt service in 2025. 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.
$1,155 to
$1,330
4,965 283 5,248 5,600 1,398 Fresno Joint Powers
Financing Authority: Lease
Revenue Refunding Bonds
2017 A, Stadium Project
A =
$13,510
tax -ex empt
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 2025, the City chose to make these lease payments from the General Fund in the amount of $1,365, 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. $1,020 to
$1,300
6,925 489 7,414 8,186 1,365 Fresno Joint Powers
Financing Authority: Lease
Revenue Bonds 2001 A & B,
Stadium Project
A =
$23,615
tax-exempt;
B
= $22,235
tax able
Acquire and construct a
M ultiPurpose Outdoor
St adium

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 2025, the City chose to make these lease payments from the General Fund in the amount of $1,818, 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.
$1,210 to
$1,700
8,655 5 8,660 10,905 1,818 Airport Revenue Bonds 2007,
Consolidated Rental Car
Facility
$22,000
tax able
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 2025 $1,728 of CFC revenues was used to fully cover the debt service payment.
$725 to
$2,265
18,235 - 18,235 26,502 1,728 Fresno Joint Powers
Financing Authority: Lease
Revenue Refunding Bonds
(Riverside Golf Course) 2017
A, Riverside Golf Course
A = $1,615
tax -ex empt
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 2025, the City chose to make these lease payments from the General Fund in the amount of $132, 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. $70 to
$125
1,205 103 1,308 1,648 132 Water System Revenue Bonds
(Taxable Build America
Bonds) 2010 A-2, Water
A-2 =
$91,340
tax able
Improvements to the
Water Sy stem

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 2025, a federal Build America Bonds subsidy of $1,020,467 was received.
$4,260 to
$7,715
87,250 (745) 86,505 138,831 10,187 Airport Revenue Bonds 2019,
Airport Parking
$35,000
tax able
Construction of a Parking
Garage

3.45% 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.
$883 to
$1,802
30,974 - 30,974 45,370 1,939 Airport Revenue Bonds 2023,
Airport Concourse & Federal
Inspection Station
A =
$94,485
AMT B =
$5,690 Non
-
AMT
Construction of
Concourse and Federal
Inspection Station

5.00% 5/25/2023 7/1/2053 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).
$1,915 to
$4,830
89,465 5,230 94,695 158,909 6,055 Revenue and other bonds total 249,431 7,401 256,832 400,086 25,939 City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

106
Note 6 – Long-Term Liabilities (Continued)

A. Summary of Long-Term Liabilities (Continued)

Issuance Net FY 2025
Rate Issue Maturity Annual Outstanding Disc/(Prem) / Principal Payments Debt Service Debt S eries Purpose Range Date Date Note Principal Principal Accreted Int Due to Maturity Payment Business-Type
Notes Payable
Water: Safe Drinking Water
Prog ram
$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
733 - 733 794 122 Water: Safe Drinking Water
Prog ram
$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
469 - 469 507 78 Water: Safe-Drinking Water
Prog ram
$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 7/16/2034 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 to
$2,570
23,133 - 23,133 23,132 2,570 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 in parity with State loans for Sewer. Principal and interest due in annual installments of $1,286.
$1,043 to
$1,282
24,263 - 24,263 27,022 1,286 Sewer: Clean Water State
Revolving Fund Project No.
8061-110
$54,484
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 in parity with State loans for Sewer. Principal and interest due in semiannual installments of $1,056.
$1,613 to
$2,090
49,735 - 49,735 56,998 2,111 Water: Drinking Water State
Revolving Fund Project
1010007-029C
$21,379
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 $407.
$627 to
$890
17,283 - 17,283 20,726 813 Water: Drinking Water State
Revolving Fund Project
1010007-031C
$57,615
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.
$1,694 to
$2,405
46,685 - 46,685 55,984 2,434 Water: Drinking Water State
Revolving Fund Project
1010007-028C
$177,894
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 $3,722. $3 million of the loan was forgiven by the State Water Resources Control
Board.
$3,691 to
$7,292
144,519 - 144,519 174,926 7,444 Water: Drinking Water State
Revolving Fund Project
1010007-030C
$67,437
Loaned
Contract between the
State Water Resources
Control Board and the
City for construction of a
ra w water pipe line to
replace the Enterprise
Canal for the Northeast
Surface Water Treatment
Facility

1.60% 8/23/2016 1/1/2050 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 $1,420.
$1,409 to
$2,784
57,369 - 57,369 69,573 2,840 Water: Drinking Water State
Revolving Fund Project
1010007-032C
$13,652
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. Principal and interest due in semiannual installments of $273.
$383 to
$635
12,390 - 12,390 13,778 545 Notes payable total 376,579 - 376,579 443,440 20,243 Business-Type total 626,010 7,401 633,411 843,526 46,182 Notes Payable
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

3.53% 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.
$80 to
$114
896 - 896 1,045 116 Notes payable total 896 - 896 1,045 116 Fiduciary total 896 - 896 1,045 116 Grand total 766,401$ 13,590 $ 779,991 $ 1,023,141 $ 72,847 $ Fiduciary

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

107
Note 6 – Long-Term Liabilities (Continued)

B. Debt Service Requirements (Excluding Capital Financing Activities)

The annual debt service requirements excluding capital fi nancings, leases and subscription-based information technology arrangements, for the City 's long-term debt outstanding as of June 30, 2025 are as follows (in thousands):

Ye ar Ending
June 30, Principal Interest Principal
Interest
Accretion Interest Principal Interest
2026 18,270 $ 7,546 $ 11,059 $ 561 $ 13,048 $ - $ - $ 2027 19,370 6,450 12,945 570 12,346 - - 2028 20,535 5,285 13,071 579 11,605 - - 2029 21,775 4,040 13,752 588 10,852 - - 2030 6,855 2,711 12,905 - 9,559 - - 2031-2035 29,230 9,188 50,780 - 37,541 - - 2036-2040 17,595 3,008 53,460 - 21,691 - - 2041-2045 4,790 805 14,430 - 10,611 - - 2046-2049 1,075 43 18,070 - 6,843 - - 2051-2055 - - 17,985 - 1,853 - - 2056-2059 - - - - - - - S ubtotal - Public Borrowings 139,495$ 39,076 $ 218,457 $ 2,298 $ 135,949 $ - $ - $ Principal Interest Principal Interest Principal Interest 2026 - $ - $ 15,792$ 6,081 $ 86 $ 30 $ 2027 - - 16,201 5,918 89 27 2028 - - 16,423 5,698 92 24 2029 - - 16,649 5,476 96 21 2030 - - 16,879 5,249 99 17 2031-2035 - - 84,698 22,731 434 31 2036-2040 - - 80,400 16,544 - - 2041-2045 - - 87,266 9,786 - - 2046-2049 - - 68,277 2,662 - - 2051-2055 - - 4,968 66 - - 2056-2059 - - - - - - Subtotal - Direct Placements - - 407,553 80,211 896 150 Issuance premiums/(discounts) 6,189 - 5,391 - - - Unaccreted interest - - 2,010 - - - Total 145,684$ 39,076 $ 633,411 $ 2,298 $ 216,160 $ 896 $ 150 $ Business-Type Activities
Direct Placements
Governmental Activities Business-Type Activities
Gove rnme ntal Acti vi ti e s
Pub lic Borrowings
Fiduciary Funds
Fiduciary Funds

C. Debt Compliance

There are a number of limitations and restrictions contained in the various loan, note and bond indentures. The City is in compliance with all significant limitations, restrictions and covenants.

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 directi on 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, fac ilities and equipment which are beneficial to the City and necessary for providing essential services.

The Policy integrates the best practices of other debt mana gement 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 re financing that took place in 2017, the City’s Debt Management Policy was reviewed to ensure compliance with Senate B ill 1029 (SB 1029). That update was approved by Council on April 6, 2017.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

108
Note 6 – Long-Term Liabilities (Continued)

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 indebtedn ess or liability that in any y ear exceeds the income and revenue provided for such year unless th e local agency first obtains two-thirds voter approval for the obligation.

This general limitation has several important exceptions as descr ibed 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 paymen t 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, 2025, the City’s debt limit (20% of valuation subject to taxation) was $10.4 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 $9.9 billion in 2024. The City’s legal debt margin is equal to the City’s debt limit because it has no debt subject to the limitation.

F. Arbitrage

Under U.S. Treasury Department regulations, all governmen tal 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 h as deferred credits and other liabilities in the governmental funds. Each Enterprise Fund has perfo rmed 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 b een recorded as a liability in the resp ective 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, 2025, the City had no arbitrage liability.

G. Capital Financing Activities

The Fresno Yosemite International Airport received $7 0 million from the issuance of 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 minimu m 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 6 – Long-Term Liabilities (Continued)

G. Capital Financing Activities (Continued)

 A new FIS facility with a target throughput of 400 arriva ls 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.

Additional costs for this project will be paid by grants and cash on hand.

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.

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 equipmen t 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 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 u sed 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 M aster 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 pur chases is to finance new and replacement equipment throughout the City. To date, there have been twenty one schedules executed totaling $38.97 million with interest rates ranging from 1.66% to 4.52% and terms of five to ten years. This new master agreement was amended to add $20 million to not to exceed amount during fiscal year 2024. This agreement expires on December 31, 2024.

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-k ey 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 fo r 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.

On July 18, 2024, the City entered into a new $23,474,520 lease purchase agreement with Flagstar Public Funding Corporation at a rate of 5.28%. The funds were for the acquisition and construction of energy efficiency improvements for the City's Wastewater Treatment Plant.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 6 – Long-Term Liabilities (Continued)

G. Capital Financing Activities (Continued)

The following table lists the City’s capital financing activities by lender as of June 30, 2025 (in thousands):

Loan Te rm Interest Annual
Lender Date (Years) Purchased Rate (P&I Payment)
Community First National Bank 7/13/2015 10 2015 Smeal Engines on Spartan Metrostar Chassis (4) 2.92% 105 $ Alliance Funding Solutions, Inc. 2/21/2020 15 Energy Efficient Equipment & Solar PPA (City Hall & MSC) 2.95% 474 Alliance Funding Solutions, Inc. 2/16/2022 15 Energy Efficiency Project Lease 2.62% 1,287 Flagstar Public Funding Corp. 7/18/2024 15 Energy Efficiency Project Lease 5.28% 1,589 Banc of America Public Capital Corp 5/2/2017 10 2017 Fire Engines & Pumpers BofA 2.52% 464 Banc of America Public Capital Corp 6/26/2018 10 2018 Fire Ladder Truck & Pumpers (3) 3.16% 371 Banc of America Public Capital Corp 5/29/2019 10 2019 Fire Pumper Trucks (3) 2.83% 239 Banc of America Public Capital Corp 5/15/2020 10 2020 Fire Engines (4) 1.34% 311 Banc of America Public Capital Corp 8/17/2020 10 2020 Type III Fire Engines (2) 1.26% 82 Banc of America Public Capital Corp 11/19/2020 5 2020 Ford Transit Van PARCS (1) 0.92% 8 Banc of America Public Capital Corp 11/19/2020 5 2021 Freightliner Street Sweepers (2) 0.92% 163 Banc of America Public Capital Corp 1/19/2021 5 2020 Fire Ford F-250 (1) 0.91% 21 Banc of America Public Capital Corp 2/19/2021 5 2021 Fire Squad Vehicle 0.92% 15 Banc of America Public Capital Corp 2/19/2021 5 2021 Fire Squad Vehicle 0.92% 15 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 2021 Engines (2) & 2021 Truck (1) 1.73% 319 Banc of America Public Capital Corp 6/18/2021 5 2021 Fire Light Duty Vehicles (3) 1.06% 60 Banc of America Public Capital Corp 11/3/2021 5 Undercover Police Vehicles (5) 1.32% 42 Banc of America Public Capital Corp 2/8/2022 5 2022 Ford Fire Dept Vhcls (8) 1.66% 153 Banc of America Public Capital Corp 5/11/2022 5 2022 Ford Fire Vehicles (13) 2.76% 163 Banc of America Public Capital Corp 6/16/2022 5 2022 Dodge Durango's (33) BMW Motorcycle (7) 2.70% 622 Banc of America Public Capital Corp 12/3/2022 10 2023 Fire Engines (2) & Fire Truck (1) 3.75% 374 Banc of America Public Capital Corp 1/20/2023 5 2023 Police Vehicles (27) - Closed 05/09/2025 3.86% 336 Banc of America Public Capital Corp 4/20/2023 5 2023 Fire Ford F-250 (1) 3.66% 28 Banc of America Public Capital Corp 6/29/2023 5 2023 BMW Motorcycle's (26) - Closed 05/09/2025 3.86% 224 Banc of America Public Capital Corp 6/29/2023 5 2023 Ford Maverick (2) - Closed 05/09/2025 3.81% 17 Banc of America Public Capital Corp 6/29/2023 5 2023 Trolley's (3) 3.86% 192 Banc of America Public Capital Corp 7/5/2023 5 2023 Dodge Durango's (105) NorthStar Veh (1) - Closed 05/13/2025 3.93% 1,958 Banc of America Public Capital Corp 7/12/2023 5 2023 Toyota Camry (3) 4.04% 23 Banc of America Public Capital Corp 10/2/2023 5 2023 Toyota Prius (10) - Closed 05/13/2025 4.27% 67 Banc of America Public Capital Corp 10/5/2023 10 Self Contained Breathing Aparatus (SCBA) 4.36% 551 Banc of America Public Capital Corp 10/11/2023 5 2023 Isuzu Truck (1) - Closed 05/15/2025 4.36% 19 Banc of America Public Capital Corp 11/28/2023 10 2023 Smeal Ladder Truck (1) 4.43% 175 Banc of America Public Capital Corp 1/3/2024 5 2023 Undercover Vehicles (70) - Closed 05/09/2025 4.00% 668 Banc of America Public Capital Corp 1/8/2024 10 2023 Fire Engines (2) - Closed 05/15/2025 3.92% 216 Banc of America Public Capital Corp 1/8/2024 10 2023 Spartan Rescue (1) 4.12% 160 Banc of America Public Capital Corp 2/26/2024 5 2024 F350 (4) F250 (1) Maverick (1) Van (1) 3.82% 148 Banc of America Public Capital Corp 5/24/2024 5 2024 Durangos (50) BMW R 1250 RT-P (15) 4.41% 1,260 Banc of America Public Capital Corp 5/24/2024 10 2024 Bearcat (1) 4.52% 55 Banc of America Public Capital Corp 7/23/2024 10 Spartan ERV SVI Incident Support 4.24% 46 Banc of America Public Capital Corp 8/1/2024 4 Cisco SMARTNet 1.00% 675 Banc of America Public Capital Corp 8/26/2024 10 (2) Type 6 Firetruck Pumpers 3.92% 42 Banc of America Public Capital Corp 9/9/2024 5 (1) Kenworth Pump Hoist Truck and (2) CAT Loaders 3.92% 108 Banc of America Public Capital Corp 10/30/2024 10 Spartan-Hazmat Fire Truck Pumper ERV SVI 3.85% 89 Banc of America Public Capital Corp 12/20/2024 10 (1) 2025 Airbus Helicopters Model AS350B3 4.16% 428 Community First National Bank 7/13/2015 10 2015 Smeal Engines on Spartan Metrostar Chassis (4) 2.92% 210 Community First National Bank 9/22/2015 10 2015 Smeal Engines on Metrostar (4) & Aerial on Gladiator (1) 2.69% 340 Community First National Bank 2/22/2016 10 2015 Smeal Engine on Spartan & 2016 Water Tender on Kenworth 2.09% 157 Total 15,482$

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 6 – Long-Term Liabilities (Continued)

G. Capital Financing Activities (Continued)

Capital Financing Activities debt service requirements are presented below (in thousands). Interest rates range from

0.91% to 5.28%.

Year Ending
June 30, Principal Interest Principal Interest
2026 10,941 $ $2,091 764 $ $1,226 2027 12,056 1,941 901 1,174 2028 10,325 1,504 670 1,134 2029 8,744 1,169 800 1,097 2030 4,845 913 942 1,053 2031-2035 20,528 2,200 7,864 4,247 2036-2040 2,868 95 11,359 1,602 Subtotal 70,307$ 9,913 $ 23,300 $ 11,533 $ Gove rnme ntal Acti vi ti e s Busi ne ss-Type Acti vi ti e s

H. General Fund Short-Term Borrowing Obligations

The City did not issue any short-term debt during fiscal year 2025 and did not have any short-term debt outstanding during the fiscal year.

I. Unused Lines of Credit

The following table lists the City's unused lines of credit as of June 30, 2025 (in thousands):

Contract
Line of Credit Amount Used Unused
Banc of America Public Capital Corporation
Public Safety 22,477 $ 13,659 $ 8,818 $ Non-Public Safety 1,848 1,108 740 Information Service Department Leases 4,036 - 4,036 Total 28,361$ 14,767 $ 13,594 $

J. 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, 2024 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
Police Regional Training Center, 6375 W. Central Ave April 1, 2039 Chukchansi Park, 1800 Tulare Street April 1, 2031
Valdez Hall, 702 M Street April 1, 2039
2020 A Animal Services Center Fresno City Hall, 2600 Fresno St. April 1, 2046

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 6 – Long-Term Liabilities (Continued)

K. Significant Events of Default, Termination and Subjective Acceleration Clauses

The City’s debt agreements contain the following terms re garding significant Events of Default, Termination and Subjective Acceleration Clauses:

Bonds

For all City bonds, an Event of Default is generally classifi ed 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 C ity 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 and Loans

For City loans associated with the construction of Wa ter 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 inst allment when due, (2) failure to make any remittances required by the agreement, (3) substant ial breach to the agreement, (4) maki ng 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 Ca lifornia may do any or all of the following: (1) declare the City’s obligations due and payable immediately, (2) terminate any obligatio n 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 Rive r 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 inte rest payment delinquencies, (2) unscheduled draws on debt service reserves, (3) bankrupt cy 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.

The City’s note and loan agreements do not contain Subjective Acceleration Clauses.

Capital Financing Activities

For all City's financed purchases associ ated 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 Ci ty 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 6 – Long-Term Liabilities (Continued)

K. Significant Events of Default, Termination and Subjective Acceleration Clauses (Continued)

Capital Financing Activities

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, represen tation 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 finance agreements do not contain Subjective Acceleration Clauses.

Note 7 – Defeasances

Current Year Defeasances

In fiscal year 2025, the City did not engage in any def easances or refundings of outstanding debt. A defeasance is typically used to set aside funds to pay off bonds early, while a refunding involves issuing new bonds to replace existing ones, often to take advantage of more favorable interest rat es. However, for this particular fiscal year, the City did not pursue either of these strategies, maintaining its existi ng debt structure without making early redemptions or restructuring through new bond issuances. This decision re flects the City's approach to managing its financial obligations without altering the terms of its outstanding debt during this period.

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. These amounts have been recorded when timing di fferences between when services are provided and when they are paid for/reimbursed causes the funds to tempor arily 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.

Due from and to other funds as of June 30, 2025, was as follows:

Receivable Fund Payable Fund Amount
General Fund Transit Enterprise Fund $ 93 Risk Management Internal Service Fund 2,654 Total due to/from other funds $ 2,747

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 8 – Interfund Activity (Continued)

B. Advances To and From Other Funds

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 F und 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 Lo an Agreement. Each year, Fire Station 18 Construction Fund shall pay at least 1/5th of the principal balance of th e loan plus interest accrued to the payment date. To the UGM Area Wide Oversized Sewer Fund, the annual princi pal payment is $480,000, while the annual payment to the UGM Wellhead Treatment Area 101S Fund is $291,540. As of June 30, 2025, $3.9 million of proceeds from this loan had been transferred to the Fire Station 18 Construction Fund, $3.6 million had been repaid and $0.3 million remains outstanding.

DPU Facility

On April 1, 2021, a loan was execute d between the City's Water Division a nd 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 Utility services that can be merged, into one facility. Th e term of the loan will be 5 years fro m 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 1st and April 1st of each fiscal year. As of June 30, 2025, all $3.7 million of proceeds from this loan had been transferred to the Solid Waste Fund, $3.0 million had been repaid and $.7 million remains outstanding.

Interfund Loan

On June 30 2024, a loan was executed between the City of Fresno Sewer System Rate Stabilization Connection Fee (CIP Reserve) Fund, and the City of Fresno Solid Wast e Management Division Solid Waste Operating Enterprise Fund, whereby funds were loaned to the Solid Waster Operating Enterprise Fund to cover operating costs necessary to continue services and to avoid depleting reserves. An amount not to exceed $5 Million was borrowed from Sewer System Rate Stabilization Connection Fee Fund. The term of the loan will be 5 years from the effective date of the loan and will accrue interest at a rate equal to the City's pooled rate, which was 3.40% at the loan agreement effective date. The term of the loan will be 5 years from the effec tive date of the loan, or June 30, 2029. The Solid Waste Operating Enterprise Fund shall make payments in the amount of 1/10th of the loan amount and interest payments twice per year on January 1st and July 1st of each fiscal year. As of June 30, 2025, all $5.0 million of proceeds from this loan had been transferred to the Solid Waste Operating Enterprise Fund, $.5 million had been repaid and $4.5 million remains outstanding.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 8 – Interfund Activity (Continued)

B. Advances To and From Other Funds (Continued)

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. Princi pal, at not less than 1/29th 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. As of June 30, 2025, $196 thousand remains outstanding.

Advances to and from other funds as of June 30, 2025, was as follows:

Receivable Fund Payable Fund Amount
Grants Special Revenue Fund General Fund $ 420 Water System Nonmajor Governmental Funds 263 Solid Waste 742
1,005
Sewer System General Fund 196
Solid Waste 4,500
4,696
Total Advances $ 6,121
City of Fresno
Notes to the Basic Financial Statements (Continued)
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Note 8 – Interfund Activity (Continued)

C. Transfers

Transfers represent subsidies by one fund to another in acco rdance with the budget a nd provide for various City programs and provide resources for the payment of debt service. Transfers in and out for the year ended June 30, 2025, was as follows:

Transfers In Transfers Out Amount
General Fund Grants Special Revenue Fund $ 1,869 Nonmajor Governmental Funds 888
Water System 26
Sewer System 26
Solid Waste Management 708
Transit 605
Internal Service Funds 1,800
5,922
Grants Special Revenue Fund General Fund 204 Nonmajor Governmental Funds 2,518
Sewer System 808
3,530
Nonmajor Governmental Funds General Fund 25,689 Grants Special Revenue Fund 2,315
Nonmajor Governmental Funds 3,803
Water System 470
Sewer System 268
Solid Waste Management 243
Transit 752
Airports 296
Nonmajor Enterprise Funds 83
Internal Service Funds 543
34,462
Water System General Fund 18
Grants Special Revenue Fund 168
Sewer System 738
924
Sewer System General Fund 19
Grants Special Revenue Fund 401
Water System 756
1,176
Solid Waste Management General Fund 1,060
Nonmajor Enterprise Funds 1,427
2,487
Transit General Fund 7
Fresno Convention Center General Fund 3,940 Stadium General Fund 3,669
Nonmajor Enterprise Funds Solid Waste Management 220 Internal Service Funds 4,227
4,447
Internal Service Funds General Fund 402 Grants Special Revenue Fund 1
Nonmajor Governmental Funds 1
Water System 816
Solid Waste Management 745
1,965
Total transfers $ 62,529

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 8 – Interfund Activity (Continued)

C. Transfers (Continued)

The General Fund transferred $25.69 million to Nonmajor Governmental Funds to provide support for debt service payments and capital projects; $3.94 million to the Convention Center for debt service as well as general operating support; $0.40 million to Internal Service Funds for pr ovided services; $0.20 million to Grants Special Revenue Fund; $1.06 million to Solid Waste; $0.22 million to Nonmajor Enterprise Funds; and $3.67 million to the Stadium Fund for debt service payments.

Nonmajor Governmental Funds transferred $7.21 million for debt service and miscellaneous purposes. Internal Service Funds transferred $0.54 million to Nonmajor Governmental Funds for debt service payments.

Note 9 – Due from Fiduciary Fund

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 rev italizing 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 betw een 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 allo wed limited, conditional repayment of loan s 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 curre nt. 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 been rendered, which further defined an "enforceab le obligation", staff revisited that initial allowance for doubtful accounts amount and refined it. At the end of fiscal year 2025, the allowance for doubtful accounts stood at $6.8 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 2024, this amount totaled $0.4 million. The repayment is reflected in the ACFR on the Combining Stat ement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental F unds, under the Special Revenue Low and Moderate Income Housing Fund.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 9 – Due from Fiduciary Fund (Continued)

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 Fund rela ted loans would go toward the rebuilding of the City’s Emergency Reserve Fund. Through June 30, 2025, the City had received $38.1 million in loan repayments from the SA. With the adoption of the fiscal year 2019 budget a nd the corresponding achievement of a 10% reserve, these repayments became a General Fund revenue source. Due from Fiduciary as of June 30, 2025, was as follows:

Total Allowance Receiv able
Beginning Receipts/ Ending Beginning Accruals/ Payments/ Ending for Doubtful (Net of Receivable Fund Balance Payments Balance Balance Adjustments Write-offs Balance Receivable Accounts Allowance) General Fund:

General Fund $ 838 $ - $ 838 $ 696 $ 25 $ - $ 721 $ 1,559 $ (1,559) $ - Parking Trust 150 - 150 125 5 - 130 280 (280) - Subtotal 988 - 988 821 30 - 851 1,839 (1,839) - Grants Special Revenue Fund 1,042 - 1,042 3,758 31 (1,251) 2,538 3,580 (2,265) 1,315 Gas Tax Special Revenue Fund 1,150 - 1,150 962 3 5 - 997 2,147 (2,147) - Fresno Convention Center 304 - 304 246 9 - 255 559 (559) - Total $ 3,484 $ - $ 3,484 $ 5,787 $ 105 $ (1,251) $ 4,641 $ 8,125 $ (6,810) $ 1,315 Principal Cumulativ e
City of Fresno Adv ances to Former Redev elopment Agency (In Thousands) TotalInterest Cumulati ve

Note 10 – Risk Management Fund

The City is exposed to various risks of loss related to to rts; 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 policy of the City to use a combination of self-insurance a nd purchased commercial insurance agai nst 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 thr ough annual appropriati ons and supplemental appropriations. The City maintains limited coverage for 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.

For Fiscal Year 2024-25, the City maintains General Liability insurance, with limits of liability of $25 million per occurrence and $25 million aggregate in Excess Liability coverage. There is a $5 million self-insured retention (“SIR”).

Coverage is provided by the Safety National Insurance Company ($5 million per occurrence /$5 million aggregate), Allied World Insurance Company ($10 million per occurrence /$10 million aggregate), StarStone Specialty ($5 million per occurrence /$5 million aggregate), and Gemini Insura nce ($5 million per occurrence /$5 million aggregate). The City has procured Automobile Physical Damage cove rage 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/Indian Harbor with a $500,000 SIR and a $5 million limit and excess Cyber liability coverage through St arr Surplus Lines Insurance Compa ny ($5 million per occurrence/$5 million aggregate). The City also maintains Airport Owners and Operators General Li ability 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

119
Note 10 – Risk Management Fund (Continued)

Furthermore, the City maintains Property insurance and Bo iler and Machinery insurance, with Travelers Insurance, with total insured values of $2,498,583,679 with aggr egate coverage of $500,000,000/$50,000,000 per occurrence.

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 mainta ins Aviation (Aircraft Hull) insurance for two helicopters, with limits of liability of $50 million in aggregate. Each claim is subject to a deductible of 1.0% of the insured value of each helicopter, up to a maximum of $15,000. This includes a rotors in-motion deductible of $15,000 and a $0 deductible for rotors not- in-motion. Coverage is provided by Old Republic Insurance Company through Old Republic.

The City’s Workers’ Compensation Program consists of $2 million SIR, with purchased excess insurance layers up to the statutory limits. With the exception of one pending claim, settled claims have not exceeded the SIR in any of the last four Fiscal Years. The claims liabilities and worker s’ 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, 2025, are determined by the City based on recommendations from an independent act uarial evaluation. The liabilities are b ased on estimates of the ultimate cost of claims (including future claim adju stments expenses) that have been reporte d but not settled, and claims that have been incurred but not reported (IBNR). The claims liability of $283.6 million reported in the Risk Management Internal Service Fund at June 30, 2025 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, 2025 are as follows (in thousands):

Workers' compensation* 186,174 $
Liability and property damage* 97,440
Total 283,614$
* 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):

Current Year
Fiscal Year Beginning of Claims and Balance at Due in
Ended Fiscal Year Changes in Claim Fiscal Year Due Within More than June 30, Liability Estimates Payments End One Year One Year 2025 260,274 $ 70,406 $ (47,066) $ 283,614 $ 42,419 $ 241,195 $ 2024 230,160 78,526 (48,412) 260,274 39,736 220,538

See Note 11 Section G for changes in funds claims liability related to Employees Healthcare Plan.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

120
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 Po lice 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 C ouncil. 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 A ugust 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 beco me fully vested after earning 5 years of service credit.

Employees working in limited, interim, provisional, temporar y, seasonal or part-time pos itions are not eligible to participate in the Systems. Participa tion is mandatory if an employee is e ligible, 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, 2025:

Employees Fire & Police Total
Active Members
Vested 1,461 834 2,295 Non-vested 1,591 385 1,976 Total active members 3,052 1,219 4,271 Retirees and Beneficiaries of Deceased Retirees
Retirees, currently receiving benefits 2,344 1,246 3,590 Inactive vested members 253 65 318 Total retirees and inactive members 2,597 1,311 3, 908 Grand total 5,649 2,530 8,179

Benefit Provisions

The retirement (pension) benefits that Employees memb ers 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 furt her based upon the tier and option selected by the participant.

Members' contributions, including interest, are 100% vest ed 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 actuarial equivalent service retirement benefit.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

121
Note 11 – Employee Benefit Programs (Continued)

A. Retirement Plans (Continued)

Benefit Provisions (Continued)

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 benef its upon completion of at least five years of service upon termination of service (if they have left their contribut ions 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 al so be eligible for service retirement benefit if they have less than five years of service with the City, have establishe d 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 y ears 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 comp ensation 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 equa l to 2.70% of final compensation times years of accrued retirement service credit. The maximum m onthly retirement allowance is 75% of final compensation. Tier 2 final average compensation consists of the highest consecutive 36 months of comp ensation earnable before the date of retirement.

The members of each System may elect an unmodified re tirement 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 member s the ability to provide certain benef its to a surviving spouse, domestic partner, or named beneficiary having an insurable inter est 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 member s, the unmodified retirement allowance also provides the highest monthly benefit and a 66 2/3% continuance to an eligible surviving spouse or domestic partner.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

122
Note 11 – Employee Benefit Programs (Continued)

A. Retirement Plans (Continued)

Member Retirement Benefits (Continued)

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 benef its 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.

Death and Disability Benefits

Death benefits are based upon whether the death occurred be fore 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 usi ng the accrual basis of accounting and in accordance with Generally Accepted Accounting Principles Generally A ccepted 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

123
Note 11 – Employee Benefit Programs (Continued)

A. Retirement Plans (Continued)

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 secur ities are accounted for on a trade date basis. Dividends declared but not received are accrued on the ex-dividend da te. 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 Cust odial 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, 2025, the annual money-weighted rate of return on pension plan investments, net of investment expense was 10.94%, for the Employees and Fi re and Police. The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested.

Reporting

The following data is for employer reporting as required by GASB Statement No. 68 as of June 30, 2025. The results used in preparing the GASB St atement No. 68 report are comparable to those used in preparing the GASB Statement No. 67 report for the plan based on a reporti ng date and measurement date as of June 30, 2024. The valuation is based upon:

 The benefit provisions of the Systems as administered by the Boards;  The characteristics of covered active members, term inated vested members, and retired members and beneficiaries as of June 30, 2024;
 The assets of each Plan as of June 30, 2024;
 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’ Fiducia ry 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 N PL 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, 2024 and determined from the actuarial valuations as of June 30, 2024. 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, 2024 were not adjusted or rolled forward to the June 30, 2025 reporting date.

The discount rates used for each Plan to determine the TPL and NPL as of June 30, 2024 was 6.75%, following the same assumptions used by the Retirement Systems in the funding valuations as of the same dates.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

124
Note 11 – Employee Benefit Programs (Continued)

A. Retirement Plans (Continued)

Funding Policy

See comments in section H of Note 13 – Commitments and C ontingencies regarding the current status of the City of Fresno employer contributions to The Systems.

For the Employees System, the average employer contributio n rate as of June 30, 202 5, for 2024-2025 (based on the June 30, 2022 valuation) was 13.4% of compensation. The average employee member contribution rate as of June 30, 2025 for 2024-2025 (based on the June 30, 2022 valuation) was 8.9% of compensation.

For the Fire and Police System, the average employer c ontribution rate as of June 30, 2025, for 2024-2025 (based on the June 30, 2022 valuation) was 21.0% of compensa tion. The average employee me mber contribution rate as of June 30, 2025 for 2024-2025 (based on the June 30, 2022 valuation) was 9.0% of compensation.

All active Fire and Police members are required to make contributions to the System. Employee contribution rates vary in the First Tier according to entr y age. The Tier 1 average member cont ribution rate as of June 30, 2025 for 2024-2025 (based on the June 30, 2022 valuation) was 0.0% of compensati on. Employee contribution rates in the Second Tier are established at 9.0% of pensionable base pay.

The aggregate employer contribution rate for the Fire and Police System as of June 30, 2025 for 2024-2025 (based on the June 30, 2022 valuation) was 21.1% of compensation.

Funding Status and Method

The Employees System Board adopted a Comprehensive Actu arial 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 Co mprehensive 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 Boar ds 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 component s 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, 2025, the Systems did not have UAAL.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

125
Note 11 – Employee Benefit Programs (Continued)

A. Retirement Plans (Continued)

Funding Requirements and Policy Components (Continued)

The Boards adopted an Amortization Policy, which set s forth the amortization procedures for funding any UAAL or amortization and allocation of any available Surplus in the Systems. A detailed description of the policy can be found in the Notes to the Financial Statements fo r 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 a nd losses above and below the assumed actuarial rate of return to derive the actuarial value of assets. As of the fiscal year end on June 30, 2025, the actuarial valuation value of the Employees’ System assets was $1.6 billion with a f unded percentage of 109.8% on a valuation value of assets, whereas the actuarial value of Fire and Police asset s was $2.0 billion with a funded percentage of 114.9% on a valuation value of assets.

Contributions Required and Contributions Made

The employer’s required normal contributions to the Sy stems have two components: basic and COLA. For fiscal year 2025, the City’s required normal contributions (basic and COLA) to the Systems were as follows (in thousands):

Normal Cost
E mployees
System
FY 2025
Employer contributions $ 31,558
Prior year contribution (surplus)/shortfall - Net employer contributions $ 31,558 Pensionable payroll $ 235,019
Member contributions 20,771
Employer contribution rate 14.09%

Employer and employee contributions re presented 13.4% and 8.9% respectively, of the fiscal year 2025 covered payroll for the Employees System.

Normal Cost
Fire and Police
System
FY 2025
Tier 2
Employer contributions $ 37,048
Prior year contribution (surplus)/shortfall (6,359) Net employer contributions $ 30,689 Pensionable payroll $ 210
Member contributions 13
Employer contribution rate 30.25%

Employer and employee contributions re presented 21.0% and 9.0%, respectivel y, of the fiscal year 2025 covered payroll for the Fire and Police System.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

126
Note 11 – Employee Benefit Programs (Continued)

A. Retirement Plans (Continued)

Net Pension Asset

The net pension liability (asset) reported as of June 30, 2 025 was measured as of June 30, 2024, and determined based upon the total pension liability (on GASB Statemen t No. 68 basis) from actuarial valuations as of June 30, 2024.

The City’s total pension liability, plan fiduciary net position, and net pension liability (asset) for each System as of June 30, 2025 were as follows (in thousands):

Employees Fire and Police
System System Total
Total pension liability $ 1,674,885 $ 1,996,001 $ 3,670,886 Plan fiduciary net position (1,815,105) (2,203,371) (4,018,476) Net pension liability (asset) $ (140,220) $ (207,370) $ (347,590) Plan fiduciary net position as a percentage of the
total pension liability -108.37% -110.39% -109.47%

Changes in Net Pension Liability (Asset)

The components of the net pension liability (asset) for each System as of June 30, 2025 and a measurement date of June 30, 2024 were as follows (in thousands):

Employees Fire and Police
System System Total
Total Pension L iability (Asset)
Beginning balance $ 1,566,984 $ 1,865,740 $ 3,432,724 Service cost 44,235 45,611 89,846 Interest 105,949 125,971 231,920 Differences between expected & actual experience 40,919 48,898 89,817 Benefit payments, including refunds (83,202) (90,219) (173,421) Net change in total pension liability 107,901 130,261 238,162 Ending balance $ 1,674,885 $ 1,996,001 $ 3,670,886 Plan Fiduciary Net Position
Beginning balance $ 1,683,314 $ 2,045,836 $ 3,729,150 Contributions - employer 28,621 30,635 59,256 Contributions - employee 18,833 13,108 31,941 Net investment income 169,857 206,468 376,325 Benefit payments (including refunds, PRSB) (83,202) (90,219) (173, 421) Administrative & professional expense (2,318) (2,457) (4,7 75) Net change in plan fiduciary net position 131,791 157,535 289, 326 Ending balance 1,815,105 2,203,371 4,018,476 Net pension liability (asset) $ (140,220) $ (207,370) $ (347,590) City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

127
Note 11 – Employee Benefit Programs (Continued)

A. Retirement Plans (Continued)

Discount Rate and Sensitivity of the Net Pension Liability (Asset) to Changes in the Discount Rate

The discount rate used to measure the TPL was 6.75% as of June 30, 2025 and June 30, 2024. The projection of cash flows used to determine the disco unt rate assumed plan member contribu tions 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 cont ributions that are intended to fund the service costs for future plan members and their beneficiaries, as well as pr ojected contributions from future plan members, are not included. Based on those assumptions, the pension Plan Fi duciary Net Position was projected to be available to make all projected future benefit paym ents for current plan members. Theref ore, the long-term expected rate of return on pension plan investments was applied to all pe riods of projected benefit payments to determine the TPL as of both June 30, 2025 and June 30, 2024.

The following presents the NPL of the Employees and Fire and Police Retirement Systems as of June 30, 2025.

The Systems use the current discount ra te to measure the TPL for the measurement date of June 30, 2024, as well as what the NPL would be if it were calculated using a discount rate that is 1-percentage-point lower (5.75%) or 1- percentage-point higher (7.75%) than the current rate:

Current
1% Decrease Discount Rate 1% Increase

5.75% 6.75% 7.75%
Employees system $ 59,686 $ (140,220) $ (303,754) Fire and police system 69,861 (207,370) (430,418) Total $ 129,547 $ (347,590) $ (734,172) (In Thousands)
NPL of E mployees and Fire and Police Retirement Systems As of June 20, 2025

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 pens ion 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-t erm expected rate of return assumption are summarized in the following table:

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

128
Note 11 – Employee Benefit Programs (Continued)

A. Retirement Plans (Continued)

Long-Term Expected Real Rate of Return (Continued)

W eighted Av erage
Long-Te rm
Expe cte d
Target Asset Rate of Return
Asset Class Allocation (Arithmetic)
Large Cap U.S. Equity 18.00% 5.59%
Small Cap U.S. Equity 3.00% 6.45%
Developed International Equity 13.00% 6.23%
Emerging Market Equity 5.00% 7.89%
Core Bonds 12.00% 2.47%
Private Equity 8.00% 9.31%
Private Debt/Direct Lending 14.00% 6.47%
Core Real Estate 6.00% 4.58%
Non-Core Real Estate 9.00% 8.19%
Absolute Return Fixed Income 1.00% 3.50%
Private Debt - Credit Opportunities 3.00% 7.09%
Private Real Estate - Infrastructure/Land 7.00% 4.63%
Cash 1.00% 0.98%
Total 100.00%
Asset Class/Target Allocation/Long-Term Expected
Rate Return Table
As of June 30, 2025

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-Weighte d 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 femal es) for healthy members, projected generationally with the two-dimensional mortality improvement scale MP-2018. For Beneficiaries, Pub- 2010 General Healthy Retiree Amount Wei ghted Mortality Table (separate ta bles for males and females) times 105%, projected generationally with the two-dimensional mortality impr ovement scale MP-2018. For disabled members, Pub-2010 Safety Disabled Retiree Amount-Weight ed Mortality Table (separate tables for males and females), projected generationally with the two-di mensional 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.

Actuarial Assumptions

The TPL as of June 30, 2024 was determined by an actua rial valuation as of June 30, 2024. The actuarial assumptions used in the valuation were based on the results of an experience study for the period from July 1, 2018 through June 30, 2021.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

129
Note 11 – Employee Benefit Programs (Continued)

A. Retirement Plans (Continued)

Actuarial Assumptions (Continued)

In particular, the following actuarial assumptions were applied to all periods included in the measurement:

Inflation 2.50%
Salary increases 3.75% to 11.50%, varying by service, including inflation (Emp loyees).

Investment rate of return
Other assumptions

4.00% to 13.00%, varying by service, including inflation (Fire and Police).

6.75%, net of pension plan investment expense, including inflation.

See Appendix A in the ACFR for the Employee's Plan and the Fire/Police Plan 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 segrega ted 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 c ontributions 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, 2025, the City in curred pension expense of $25.8 million for the Employees Plan and $23.5 million for the Fire and Police Plan for a total pension expense of $49.3 million.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 11 – Employee Benefit Programs (Continued)

A. Retirement Plans (Continued)

Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)

As of and for the year ended June 30, 2025, the City has pension expense and deferred outflows and deferred inflows of resources related to the pensions as follows:

Pe nsion Expe nse and Defe rre d Outflows and Inflows
(in thousands) Employees Fire and Police
Components of Pension Expense System System Total
Service cost $ 44,235 $ 45,611 $ 89,846 Interest on the total pension liability 105,949 125,971 231,92 0 Expensed portion of current-period difference between
actual experience in the total pension liability 9,321 10,360 19,681 Actual member contributions (18,833) (13,108) (31,941) Projected earnings on plan investments (112,339) (136,442) (248,781) Expensed portion of current-period differences between
projected earnings on plan investments (11,504) (14,005) (25,509 ) Administrative expense 2,318 2,458 4,776 Recognition of beginning of year deferred outflows
of resources as pension expense 85,058 95,912 180,970 Recognition of beginning of year deferred inflows of
resources as pension expense (78,414) (93,291) (171,705) Pension expense $ 25,791 $ 23,466 $ 49,257 Deferred outflows of resources:

Contributions subsequent to measurement date $ 29,068 $ 28,884 $ 57,952 Changes of assumptions or other outputs - 178 178 Difference between expected and actual experience
in the total pension liability 58,006 73,205 131,211 Deferred outflows of resources 87,074 102,267 189,341 Deferred inflows of resources
Net difference between projected and actual
earnings on pension plan investments 43,781 53,230 97,01 1 Changes of assumptions 880 - 880 Difference between expected and actual experience
in the total pension liability - 403 403 Deferred inflows of resources $ 44,661 $ 53,633 $ 98,294

For the Employees Plan and Fire and Police Plan, $29, 068 and $28,884, respectively, was reported as deferred outflows of resources related to pensions resulting from City ’s contributions subsequent to the measurement date and will be recognized as a increase in the net pension asset in the year ended June 30, 2026. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Fiscal E mployees Fire and Police
Y ear System System Total
2026 $ (10,175) $ (16,415) $ (26,590) 2027 45,051 55,348 100,399 2028 (13,662) (12,637) (26,299) 2029 (7,869) (6,546) (14,415) Totals $ 13,345 $ 19,750 $ 33,095 Deferred Outflows/(Inflows) of Resources
City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 11 – Employee Benefit Programs (Continued)

A. Retirement Plans (Continued)

Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)

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 wh ich they occur. Differences between expected and actual experiences are recognized over the average of the exp ected remaining service lives of all employees that are provided with pensions through the Re tirement Systems determined as of J une 30, 2023 (the beginning of the measurement period ending June 30, 2024) and is 4.39 years for the Employees System and 4.72 years for the Fire & Police System.

Administrative Expenses

The Fresno Municipal Code (FMC) provides that all administ rative costs of the Systems shall be a charge against the assets of the Systems. Per the FMC, the Administrative expenses are a co mponent 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, 2024), the net pension liability for the Plan is $733,631.

For the measurement period ended June 30, 2025 (the measurement date), the net pension liability for the Plan is $727,489 and the Successor Agency incurred pension expense of $126,373 for the Plan.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 11 – Employee Benefit Programs (Continued)

A. Retirement Plans (Continued)

Successor Agency Retirement Plan (Continued)

As of June 30, 2025, the Successor Agency reports othe r amounts for the Plan as deferred outflows and deferred inflows of resources related to pensions as follows (in thousands):

Deferred Deferred
Outflows of Inflows of
Resources Resources
Contribution made after the measurement date 70 $ - $ Difference between expected and actual
experience 63 2
Changes of assumptions 18 - Net difference between projected and actual
earnings on pension plan investments 42 - Employer contributions in excess/(under)
proportionate share of contributions - 32 Adjustments due to difference in proportions 4 6 Total 197 $ 40 $

For more detailed information related to the Successor Ag ency’s retirement plan, refer to the Successor Agency’s separate audited financial statements which can be ob tained 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 Inte rnal 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 emergenc y, 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 Ad ministration 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 11 – Employee Benefit Programs (Continued)

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, wh ich 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). Otherw ise, employees do not receive any value from their sick leave balances at termination.

Annual leave, which may be accumulated up to 1,200 hours, depending upon bargaining unit and length of service, is payable upon termination or retirem ent. Holiday leave may be accumula ted 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, professi onals 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 Memo randa of Understanding (MOU’s) or the current Salary Resolution. The balance is payable at termination/retirem ent 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 valu e 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 spou se 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 employ ees' rights to receive compensation for leave balances attributable to services already rendered is accrued wh en 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 citywi de history of payouts (approximately $2 million per year). Accruals are reviewed by bargaining unit and the $2 million base is allo cated 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
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 11 – Employee Benefit Programs (Continued)

C. Compensated Absences (Continued)

Accrued Employee Leave balances as of June 30, 2025, are as follows (in thousands):

Total Accrued
S ick Leave, Current
Department/Activity and HRA Portion
Governmental Activities:

General Fund $ 83,656 $ 11,805 Grants Special Revenue Fund 3,549 262 Special Gas Tax 1,082 122 Measure C 1,446 216 Measure P 997 76 Community Services 525 44 Special Assessment 449 51 General Services 5,866 562 Risk Management 331 39 Total Governmental Activities 97,901 13,177 Business-Type Activities:

Water System 2,520 471 Sewer System 2,403 375 Solid Waste Management 1,807 402 Transit 4,286 730 Airports 2,076 422 Community Sanitation 728 69 Parks and Recreation 9 3 Billing and Collection 1,667 330 Total Business-Type Activities 15,496 2,802 Fiduciary Funds:

Private-Purpose Trust Fund 78 17 Total $ 113,475 $ 15,996

Accrued employee leave balances re lated to governmental activities are recorded in the Government-Wide Financial Statements under Long-Term Liabilities.

D. Termination Benefits

During fiscal year 2025, 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 empl oyees. 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

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Note 11 – Employee Benefit Programs (Continued)

E. Health Benefit Plan (Continued)

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 ch arges and the employee is responsible for 20% of the covered charges. Once a cove red 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 contri bution, the medical benefits are reduced by 30%. This reduction results in the plan paying 56% of covered char ges 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 c overed charges. Employees in the FCEA hired before July 11, 2011, continue to have an 80% - 20% contribution split as described above.

City retirees are also eligible for participation in th e 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 associ ated with one case that totaled more than $500,000. In addition to the stop-loss insurance, the Health and Welf are 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 as sets 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.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

136
Note 11 – Employee Benefit Programs (Continued)

F. Other Post-Employment Benefits (Continued)

Plan Description (Continued)

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 actu arially determined expense on the Statement of Activities when a future retiree earns their pos t-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 h ealthcare 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 ba rgaining 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.

Employees Covered

As of June 30, 2023, valuation date, the following employees were covered by the benefit terms:

Inactive employees or beneficiaries currently receiving benefit payments 401 Inactive employees entitled to but not yet receiving benefit payments - Active employees 3,873
Total participants covered by OPEB Plan 4,274

Total OPEB Liability

The City's net OPEB liability of $ 94.1 million was measured as of June 30, 2024, and was determined by an actuarial valuation as of June 30, 2023 to determine the June 30, 2025 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:

Measurement date June 30, 2024
Valuation date June 30, 2023
Discount rate 5.20%
Healthcare cost trend rates:

Current year trend 8.00% / 5.00%
Decrement N/A
Ultimate trend 4.54%
Year ultimate trend is reached 2090
Salary increases 3.50%
Actuarial cost method Entry Age Normal (Percent of Salary)

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

137
Note 11 – Employee Benefit Programs (Continued)

F. Other Post-Employment Benefits (Continued)

Actuarial Assumptions and Other Inputs

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, 2023 (valuation date).

Mortality rates were based on the SOA RP-2014 Total Dataset Mortality with Scale MP-2019 (Base Year 2006).

Sensitivity of the Total OPEB Liability to Changes in the Discount Rate

The June 30, 2023 valuation was prepared using a discount rate of 5.20%. If the discount rate were 1% higher than what was used in this valuation, the Total OPEB Liab ility would decrease to $81.1 million or by 13.8%. If the discount rate were 1% lower than was used in this valuation, the Total OPEB Liability would increase to $109.9 million, or by 12.7%.

1% Decrease Discount Rate 1% Increase

4.20% 5.20% 6.20%
Net OPEB liability (in thousands) $ 109,853 $ 94,118 $ 81,140

0.167% 0.160% -0.138%

Sensitivity of the Total OPEB Liability to Changes in the Healthcare Cost Trend Rates

The June 30, 2023 valuation was prepared using an initial trend rate of 5.04% / 4.82%. If the trend rate were 1% higher than what was used in this valuation, the Total OPEB Liability would increase to $110.0 million or by 17.0%.

If the trend rate were 1% lower than was used in this valuation, the Total OPEB Liability would decrease to $81.2 million or by 16.7%.

Healthcare Cost
1% Decrease Trend Rates 1% Increase
-1% 8.00% / 5.00% 1%
Net OPEB liability (in thousands) $ 81,187 $ 94,118 $ 110,094 -0.137% 0.170%

Changes in the Total OPEB Liability

The changes in the Total OPEB Liability for the City OPEB Plan are as follows:

Increase/(Decrease)
(in thousands)
OPEB liability as of June 30, 2023 $ 109,448 Changes for the year:

Service cost 5,506
Interest 4,725
Assumption changes (22,624)
Benefit payments (2,937)
Net changes (15,330)
OPEB liability as of June 30, 2024 (measurement date) $ 94,118 City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

138
Note 11 – Employee Benefit Programs (Continued)

F. Other Post-Employment Benefits (Continued)

OPEB Expense, Deferred Outflows of Resources, and Deferred Inflows of Resources

For the year ended June 30, 2025, the City recognized an OPEB expense of $5.0 million. At June 30, 2025, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources (in thousands):

Deferred Outflows Deferred Inflows
of Resources of Resources
OPEB contributions subsequent to the measurement date $ 3,587 $ - Changes of assumptions 17,045 57,872 Difference between actual and expected experience 1,350 13,090 Total $ 21,982 $ 70,962

The $3.6 million reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the total OPEB liability during the fiscal year ending June 30, 2026. Other amounts reported as deferred outflows of resources and de ferred inflows of resources related to OPEB will be recognized in OPEB expense as follows (in thousands):

Deferred
Fiscal Outflows/(Inflows)
Year of Resources
2026 (10,074) $
2027 (8,614)
2028 (8,530)
2029 (8,878)
2030 (7,049)
Thereafter (9,422)
Total (52,567)$

G. Healthcare Plan Claims Liability

The recorded liability for the Employ ees Healthcare Plan at June 30, 2025 for employee health benefit claim payments for direct provider care is $8.3 million.

Changes in the funds claims liability amount for the last two fiscal years are as follows (in thousands):

Current Year
Fiscal Year Beginning of Claims and Claims
Ended Fiscal Year Changes Claims End of Fiscal
June 30 Liability in Estimates Payments Year Liability
2025 6,400 $ 75,434 $ (73,534) $ 8,300 $ 2024 7,900 69,512 (71,012) 6,400 City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

139
Note 12 – No-Commitment Debt

The City is not liable for repayment of any of the following bond s, and accordingly, they are not reflected in the accompanying basic financial statements.

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/assessmen ts, forwarding the collections to the trus tee/paying agent, and initiating foreclosure proceedings, if appropriate. Special District debt payable to bond holders was $1.8 million at June 30, 2025, as compared to $2.1 million at June 30, 2024.

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, 2025 to be $7.0 million.

A liability in this amount has been recorded in the Solid Waste Manageme nt Fund. It is anticipated that approximately $0.9 million in monitoring costs and landfill site closure costs will be paid in fiscal year 2026. The Fresno sanitary landfill has not received solid waste sin ce 1987. It was redesigned as part of a 350-acre “green” facility to integrate the Fresno sanitary landfill site into a championship caliber sports complex/regional park. The estimated total remaining post-closure care costs are b ased on the equipment, facilities, and services required to monitor/maintain the closed landfill. Th e 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 remain ing monitoring costs. A receivable totaling $5.9 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 res ource 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:

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.

Pricing benefits - Certain components of the Bureau water rate structure, such as tiered pricing, are eliminated.

Financing cost savings - Under the previous Bureau rate structure, the City paid certain financing costs and interest on the outstanding capital and operation and mainte nance obligations that the Bureau attributed to the City. Under a Repayment Contract, those costs are not passed on to the City.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

140
Note 13 – Commitments and Contingencies (Continued)

B. CVP Water Contract (Continued)

Because repayment contracts do not require periodic re newal, 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 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 $0.6 million on June 30, 2025.

C. Other Litigation

There are various other lawsuits and claims pending against the City. Alth ough the outcome of these claims and lawsuits is not presently determinable, management, after consultation with lega l counsel, is of the opinion that a majority of these matters will not have a material adve rse effect on the financial condition of the City at June 30, 2025.

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 th e subject of investigation and cleanup efforts which had previously been jointly funded by the Boeing Company (B oeing), the U.S. Army Corps of Engineers and the City of Fresno. The area had been used for the repair, overhau l, maintenance, refurbishing and construction of aircraft during and after World War II. The California Departme nt 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 coordi nating further efforts to implement the State-Approved Remedial Action Plan to obtain Site Closure. All parti es 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 2025 ACFR in the amount of $220,000. 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 tim e frame has also been es timated and is expected to continue for 20 to 40 years. Cleanup costs totaled $57,000 in fiscal year 2025.

The City will re-evaluate this accrual annually and make adjustments as necessary.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

141
Note 13 – Commitments and Contingencies (Continued)

D. Toxics Mitigation (Continued)

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 exceed s 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. Subj ect 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 a nd 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 “cl eanup” 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 h as not occurred during the fiscal year; therefore, no liability exists.

Pollution Remediation

Although the Successor Agency is generally not involved w ith operations that pose a high risk for environmental liabilities, properties acquired for redevelopment purpo ses 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 Environmen tal 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 federa l 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 Clos ure” letter that officially declares the property free of hazardous substances or petroleum products.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

142
Note 13 – Commitments and Contingencies (Continued)

D. Toxics Mitigation (Continued)

Pollution Remediation (Continued)

During fiscal year 2016, the Successor Agency held one par cel 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 th e four 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 C ity 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 th e 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 Chaff ee 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 be tween the City and FCZC, with respect to the Zoo premises and any expansion that might occur in a desi gnated 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, struct ures, 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 ot herwise 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
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

143
Note 13 – Commitments and Contingencies (Continued)

F. Construction and Other Significant Commitments

On June 30, 2025, the City had commitments for the following major construction projects (in thousands):

Remaining
Construction
Project Title Committed
Governmental:

Citywide Senior Center 27,104 $
Milburn & Dakota Park 7,011
Peach Property-Phase 1 6,566
MLK Cnt Active Trans Infrastr 4,165
Peach Ave Widening 2,863
Blackstone AC Overlay-Minarets 2,733
DPU O&M Building Fleet Paving 2,585
Sewer Rehab-Downtown Infrastructure Grant 2,461
Total governmental - major projects 55,488
Other gov ernmental projects 32,277
Total gov ernmental projects 87,765$
Proprietary:

Terminal/FIS Expansion 48,329 $
Fire Station #12 Relocation 14,300
North Trunk Rehab- North Maple 13,750
911 Call Center 12,936
Sewer Main-Orange 10,829
WM R Clinton/Univ/West/Teilman 5,525
MLK Magnet Park 4,855
Maint Facility H2 Detection 3,464
Milburn & Dakota Park 2,939
Citywide Senior Center 2,412
Olive Ave Emergency Sewer Repair 2,400
Merced Office Renovation 2,346
Total proprietary - major projects 124,085
Other proprietary projects 24,961
Total proprietary projects 149,046$
Total committed construction projects 236,811$

G. 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 Protecti on 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, multip le community meetings a nd presentations, and public distribution of information and education materials.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

144
Note 13 – Commitments and Contingencies (Continued)

G. Discolored Water (Continued)

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 s upply. Litigation is currently ongoing. The City will continue to vigorously defend itself in these matters.

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 s upply. 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.

The City has spent $5.1 million cumulati vely through the year ended June 30, 2025 to investigate and address the discolored water complaints. All of these costs have been and will continue to be recorded in the Water Fund.

H. City of Fresno Fire and Police Retirement System – Contribution Rate and Related Litigation

The City of Fresno participates as the plan sponsor of th e City of Fresno Fire and Police Retirement System (the "System"). Under the City’s municipal code, the C ity is responsible for re mitting employer and employee contributions to the System based on rates adopted by the System’s Board of Retirement (the "Board"). These rates are established in accordance with the System’s funding policy and are based on an independent actuarial valuation.

The System has initiated litigation seeki ng to compel the City to remit empl oyer contributions in accordance with the actuarially determined rate adopted by the Board. As of June 30, 2025, this litigation remains pending and the ultimate outcome cannot presently be determined. The City does not agree that the Retirement Systems are "subject to a constraint related to the inflow of resources from its plan sponsor" or that there was a "shortfall in contributions received during fiscal year 2024-25" as presented in the System’s Annual Comprehensive Finance Report (ACFR).

Note 14 – Securities Lending

The City does not engage in securities lending with any i nvestment 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 Syst ems’ security lending policies and the financial effect of such lending, please see the Retirement Sy stems’ 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
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

145
Note 15 – Other Information

Construction Retainage Escrow Accounts

The City enters into construction contr acts with various outside third-party contractors with respect to major capital projects. As the construction progresses, progress payments ar e 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 th e 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 be nefit of suppliers and subcont ractors. 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 and expended by the City as of June 30, 2024.

American Rescue Plan Act (ARPA) funding the Coronaviru s State and Local Fiscal Recovery Funds (SLFRF) – In March 2021, the City was awarded $170.8 million of SLFRF fundi ng and has allocated all funding to various City led and Community Based Organization led projects. As of June 30, 2025, the City has expended $149.9 million in SLFRF funding and continues to implement identified projects throughout the City of Fresno.

American Rescue Plan Act (ARPA) funding the HOME I nvestment Partnerships – American Rescue Plan (HOME- ARP) – In September 2021, the City was awarded $11.9 million of HOME-ARP funding. Funding is anticipated to be used for supportive services, acquisition and development of non-congregate shelter, development of affordable rental housing, and administration and planning. As of June 30, 2025, the City has expended $403 thousand in HOME-ARP funding and continues to implement identified projects throughout the City of Fresno.

Coronavirus Aid, Relief and Economic Security Act (CARES Act) funding the Community Development Block Grant- Coronavirus (CDBG-CV) – In April 2021, the City was aw arded $7.9 million of CDBG-CV in two trenches. Funding is anticipated to be used for emergency shelter operations and supportive services, a mobile medical clinic, tenant and landlord counseling, homeless facility ac quisition and rehabilitation, and program administration and compliance. As of June 30, 2025, the City has e xpended $5.6 million in CDBG-CV funding a nd continues to implement projects throughout the City of Fresno.

Note 16 – Deficit Fund Equity

The Risk Management Internal Service Fund had a deficit net position as of June 30, 2025.

The deficit net position in the Risk Management Fund at June 30, 2025 was $288.7 million, an increase of $25.6 million.

The increase was due to the City reflecting a Liability for Self-Insurance on its Combini ng Statement of Net Position in the amount of $283.6 million. This liability grew by $ 23.3 million between fiscal years 2024 and 2025.

City management continues to carefully monitor this fund and evaluate strategies for reducing and eliminating this deficit net position balance.

City of Fresno
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2025

146
Note 17 – Net Investment in Capital Assets

Net Investment in Capital Assets at June 30, 2025 consisted of the following:

Governmental Business-Type
Activities Activities
Net investment in capital assets:

Capital assets, nondepreciable 658,786 $ 333,591 $ Capital assets, depreciable/amortizable, net 782,915 1,364,528 Unspent bond proceeds on capital-related debt 13,944 19,247 Capital-related liabilities:

Retention payable (6,281) (37,907)
Bonds from public borrowings, of premium/(discount) (90,284) (285,797) Bonds from direct placements - 30,974 Accreted interest - (2,010)
Notes payable from direct borrowings - (376,580) Lease and subscription liability (15,152) (1,360) Finance purchase agreements (70,307) (23,300) Total net investment in capital assets 1,273,621 $ 1,021,386 $

Note 18 – Subsequent Events

Fresno Joint Powers Financing Authority, Lease Revenue Bonds, Series 2025A&B (Public Safety Projects)

On August 28, 2025, the Authority issuing $53,230,000 prin cipal amount of Fresno Joint Powers Financing Authority Lease Revenue Bonds (Public Safety Projects), Series 2025A (the “Series 2025A Bonds”) and $1,750,000 principal amount of Fresno Joint Powers Financing Authority L ease Revenue Bonds (Public Safety Projects), Series 2025B (Federally Taxable) (the “Series 2025B Bonds” and, together with the Series 2025A Bonds, the “Series 2025 Bonds”) to: (i) pay the costs of constructing a new Fire Station No. 12 and a new 911 Emergency Call Center, and constructing and installing certain improvements to the Police Departme nt Headquarters Building (collectively, the “Series 2025 Projects”) located in the City of Fresno (the “City”); (ii) capitalize interest on the Series 2025 Bonds through April 1, 2029; and (iii) pay certain costs associated with the issuance of the Series 2025 Bonds, including premiums.

The Series 2019A Bonds are scheduled to mature on each April 1 from 2030 to 2055 with serial bonds from 2030 to 2045 with principal amounts ranging from $200,000 to $2,230 ,000 and term bonds maturing in 2050 in the amount of $12,985,000 and 2055 in the amount of $16,645,000. The Seri es 2019A Bonds interest is paid semi-annually with interest rates ranging from 4.63% to 5.25%. The Series 2019B Bonds are serial bonds scheduled to mature on each April 1 from 2030 to 2031 with principal amounts ranging from $860,000 to $890,000. The Series 2019B Bonds included interest is paid semi-annually with interest rates ranging from 4.18% to 4.41%.

The Series 2025A bonds were sold with a net original issue premium of $2,282,334 and costs of issuance of $1,072,204 (including the underwriter’s discount, th e fee for bond insurance and a surety fee for the reserve fund). The Series 2025A bonds were sold with costs of issuance of $34,644 (including the underwriter’s discount, the fee for bond insurance and a surety fee for the r eserve fund). The Series 2025A and 2025B bonds are secured by a pledge of lease revenues pursuant to Master Facilities Sublease, dated September 1, 2025.

147

REQUIRED SUPPLEMENTARY INFORMATION

148
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City of Fresno
Required Supplementary Information (Unaudited)
Budgetary Information
For the Year Ended June 30, 2025

149
Budgetary Control and Budgetary Accounting

Budgets are legally adopted and formal budgetary integration is employed as a management control device during the year for all governmental fund types. The budget is pr epared in accordance with accounting principles generally accepted in the United States of America. From the effective date of the budget, the amounts stated therein as proposed expenditures become appropriations to the various City departments.

The City has five-year business plan development procedur e. The five-year business plan process requires that each department submit their five-year expe nditure plans and revenue estimates to be provided to the City Council for approval. Only the first year of the five-year business plan will be adopted. The remaining years represent a projected plan which is expected to be appropriated by resolution in the following years. As a part of the five-year business plan, the focus in year one is on the operating budget, while the focus on years two through five is the City’s CIP.

The City controls its budget at the fund and department level. The City Council is the sole budget authority. Activities of the General Fund, Special Revenue Funds, Debt Servi ce Funds, Proprietary Funds, and Capital Funds are included in the annual budget. The City does not adopt budgets for the Fresno Revitalization Corporation and Fresno E.I.F.D.

Special Revenue Funds.

150
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City of Fresno
Required Supplementary Information (Unaudited) (Continued) Schedule of Revenues, Expenditures, and Change in Fund Balance Budget and Actual – General Fund
For the Year Ended June 30, 2025
(amounts in thousands)

151

Variance with
Final Budget
Actual Favorable/
Original Final Amounts (Unfavorable)
REVENUES :

Tax es:

Property taxes 189,806 $ 189,806 $ 190,137 $ 331 $ Sales taxes 151,746 151,746 146,400 (5,346) Other taxes 41,566 41,566 46,460 4,894 Franchise taxes 22,064 22,064 23,391 1,327 Licenses and permits 9,610 9,796 9,699 (97) Intergovernmental:

Federal g rants 13 13 129 116 State grants - - 3 3 State motor vehicle in-lieu - - 1,699 1,699 Local support 35 535 500 (35) Other state revenue 536 536 742 206 Other intergovernmental 48 48 - (48) Charges for services 43,572 43,572 37,933 (5,639) Fines, forfeitures and penalties 2,995 2,995 3,997 1,002 Use of money and property 2,640 2,640 7,261 4,621 Miscellaneous 57,951 58,293 1,835 (56,458) Total revenues 522,582 523,610 470,186 (53,424) EXPENDITURES :

Current:

General government 67,668 73,384 51,416 21,968 Public protection:

Police Department 72,463 73,755 66,264 7,491 Fire Department 251,015 251,119 232,018 19,101 Public ways and facilities 24,018 24,437 20,167 4,270 Culture and recreation 37,966 39,816 13,511 26,305 Community development 74,127 77,851 47,742 30,109 Capital outlay 10,160 14,577 18,398 (3,821) Debt service:

Principal - - 8,538 (8,538) Interest - - 1,502 (1,502) Total expenditures 537,417 554,939 459,556 95,383

REVENUES OVER
(UNDER) EXPENDITURES (14,835) (31,329) 10,630 41,959

OTHER FINANCING S OURCES (US ES ):

Capital financing activity - - 19,574 19,574 Transfers in 7,197 7,197 5,922 (1,275) Transfers out (24,091) (24,091) (35,008) (10,917) Total other financing sources (uses) (16,894) (16,894) (9,512) 7,382 NET CHANGE IN FUND BALANCE (31,729)$ (48,223) $ 1,118 7,382 $ FUND BALANCE:

Beginning of y ear 109,039
End of year 110,157$
Budgeted Amounts

City of Fresno
Required Supplementary Information (Unaudited) (Continued) Schedule of Revenues, Expenditures, and Change in Fund Balance Budget and Actual – Grants Fund
For the Year Ended June 30, 2025
(amounts in thousands)

152
Variance with
Final Budget
Actual Favorable/
Original Final Amounts (Unfavorable)
REVENUES :

Intergovernmental:

Federal grants 86,584 $ 92,331 $ 90,094 $ (2,237) $ State grants 199,133 204,651 94,572 (110,079) Local support 117 170 137 (33) Other state revenue 24,078 25,384 145 (25,239) Other intergovernmental - - (475) (475) Charges for services 2,025 2,025 - (2,025) Use of money and property 1,887 1,887 25 (1,862) Miscellaneous 1,008 1,008 364 (644) Total revenues 314,832 327,456 184,862 (142,594) EXPENDITURES :

Current:

General government 5,865 5,865 5,881 (16) Public protection 44,268 44,268 44,268 - Public ways and facilities 7,075 6,919 1,714 5,205 Culture and recreation 35,879 50,762 11,341 39,421 Community development 196,610 220,763 28,154 192,609 Capital outlay 113,365 177,737 69,073 108,664 Debt service:

Principal - - 631 (631) Interest - - 40 (40) Total expenditures 403,062 506,314 161,102 345,212

REVENUES OVER
(UNDER) EXPENDITURES (88,230) (178,858) 23,760 202,618

OTH E R F I NA NCI NG SOU R CE S (U SE S):

Transfers in 216 216 3,530 3,314 Transfers out (175) (175) (4,754) (4,579) Total other financing sources (uses) 41 41 (1,224) (1,265) NE T CHANGE IN FUND BALANCE (88,189)$ (178,817) $ 22,536 201,353 $ FUND BALANCE:

Beginning of year 42,609
End of year 65,145$
Budgeted Amounts

City of Fresno
Required Supplementary Information (Unaudited) (Continued) Schedule of Investment Returns
Last Ten Fiscal Years

153

Fiscal Year Annual Money-Weighted Rate of Return Annual Money-Weighted Rate of Return Ending June 30 Gross of Investment Expenses Net of Investment Expense 2025 11.07% 10.92%
2024 10.56% 10.38%
2023 9.74% 9.52%
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 14.73% 14.35%
2016 0.82% 0.53%
All Retirement S ystems (Combined)
Last Te n Fi scal Ye ars
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 (2015-2024). 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 subperiod 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.

Pension Trust Funds

City of Fresno
Required Supplementary Information (Unaudited) (Continued) Schedule of Changes in the Net Pension Liability (Asset) and Related Ratios Last Ten Fiscal Years
(amounts in thousands)

154

Change in Net Pension L iability (Asset) (in thousands) For the Fiscal Year Ended: 6/30/2025 6/30/2024 6/30/2023 6/30/2022 6/30/2021 Reporting Date: 6/30/2025 6/30/2024 6/30/2023 6/30/2022 6/30/2021 Measurement Date: 6/30/2024 6/30/2023 6/30/2022 6/30/2021 6/30/2020 Total Pension Liability:

Service Cost $45,611 41,190 $ 38,322 $ 37,563 $ 37,619 $ Interest 125,971 117,304 114,608 109,740 105,570 Differences between expected & actual experience 48,898 51,061 22,226 (5,449) 260 Changes of assumptions - - 624 - (14,745) Benefit payments, including refunds (90,219) (80,937) (75,178) (70,963) (67,202) Net changes in Total Pension L iability 130,261 128,618 100,602 70,891 61,502 Beginning of Year 1,865,741 1,737,123 1,636,521 1,565,630 1,504,128 End of Ye ar 1,996,002$ 1,865,741 $ 1,737,123 $ 1,636,521 $ 1,565,630 $ Plan Fiduciary Net Position:

Contributions - employer 30,635 $ 27,068 $ 27,556 $ 26,315 $ 22,324 $ Contributions - employee 13,108 12,054 10,973 10,256 10,012 Net Investment Income 206,468 198,976 (160,517) 491,744 24,206 Benefit Payments including Refunds, PRSB (90,219) (80,937) (75,178) (70,963) (67,202) Administrative & Professional Expense (2,459) (2,401) (2,126) (2,282) (1,839) Net changes in Plan Fiduciary Net Position 157,533 154,760 (199,292) 455,070 (12,499) Beginning of Year 2,045,839 1,891,079 2,090,371 1,635,301 1,647,800 End of Ye ar 2,203,372$ 2,045,839
$ 1,891,079 $ 2,090,371 $ 1,635,301 $ Net Pension L iability (Asset) (207,370)$ (180,098) $ (153,956) $ (453,850) $ (69,671) $ Fiduciary Net Position as a
percentage of Total Pension Liability 110.39% 109.65% 108.86% 127.73% 104.45% Covered Payroll 145,669$ 134,252 $ 122,634 $ 115,341 $ 113,843 $ Net Pension Liability (Asset) as a % of Payroll -142.36% -134.15% -125.54% -393.49% -61.20% * 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.

Pension Trust Funds
Fire and Police Retirement S ystem
(Last Ten Fiscal Years)
(1) Covered payroll represents payroll in which contributions to the Systems are based.

City of Fresno
Required Supplementary Information (Unaudited) (Continued) Schedule of Changes in the Net Pension Liability (Asset) and Related Ratios (Continued) Last Ten Fiscal Years
(amounts in thousands)

155

Change in Net Pension L iability (Asset) (in thousands) For the Fiscal Year Ended: 6/30/2020 6/30/2019 6/30/2018 6/30/2017 6/30/2016 Reporting Date: 6/30/2020 6/30/2019 6/30/2018 6/30/2017 6/30/2016 Measurement Date: 6/30/2019 6/30/2018 6/30/2017 6/30/2016 6/30/2015 Total Pension Liability:

Service Cost $33,211 $30,298 $28,838 $26,569 $26,518
Interest 100,609 95,274 90,184 88,363 86,772 Differences between expected & actual experience (7,067) 6,722 10,896 (42,953) (36,528) Changes of assumptions 55,856 2,891 - 49,427 - Benefit payments, including refunds (65,962) (63,071) (59,273) (56,581) (54,612) Net changes in Total Pension L iability 116,647 72,114 70,645 64,825 22,150 Beginning of Year 1,387,481 1,315,367 1,244,722 1,179,897 1,157,747 End of Ye ar 1,504,128$ 1,387,481 $ 1,315,367 $ 1,244,722 $ 1,179,897 $ Plan Fiduciary Net Position:

Contributions - employer $20,604 $19,697 $18,543 $18,738 $18,967 Contributions - employee 9,597 8,964 8,169 7,748 7,385 Net Investment Income 82,872 129,163 192,315 6,063 39,164 Benefit Payments including Refunds, PRSB (65,962) (63,071) (59,273) (56,581) (54,612) Administrative & Professional Expense (1,897) (1,710) (1,500) (1,397) (1,108) Net changes in Plan Fiduciary Net Position 45,214 93,043 158,254 (25,429) 9,796 Beginning of Year 1,602,586 1,509,543 1,351,289 1,376,718 1,366,922 End of Ye ar 1,647,800$ 1,602,586 $ 1,509,543 $ 1,351,289 $ 1,376,718 $ Net Pension L iability (Asset) (143,672)$ (215,105) $ (194,176) $ (106,567) $ (196,821) $
Fiduciary Net Position as a
percentage of Total Pension Liability 109.55% 115.50% 51.17% 108.56% 116.68% Covered Payroll 109,803$ 103,934 $ 97,369 $ 94,266 $ 91,075 $ Net Pension Liability (Asset) as a % of Payroll -130.85% -206.96% -199.42% -113.05% -216.11% Pension Trust Funds
Fire and Police Retirement S ystem
(Last Ten Fiscal Years)
City of Fresno
Required Supplementary Information (Unaudited) (Continued) Schedule of Changes in the Net Pension Liability (Asset) and Related Ratios Last Ten Fiscal Years
(amounts in thousands)

156
Change in Net Pension L iabilit y (Asset) (in thousands) For the Fiscal Year Ended: 6/30/2025 6/30/2024 6/30/2023 6/30/2022 6/30/2021 Reporting Date: 6/30/2025 6/30/2024 6/30/2023 6/30/2022 6/30/2021 Measurement Date: 6/30/2024 6/30/2023 6/30/2022 6/30/2021 6/30/2020 Total Pension Liability:

Service Cost 44,235 $ 37,299 $ 32,382 $ 30,993 $ 28,762 $ Interest 105,949 99,304 96,311 93,357 89,222 Differences between expected & actual experience 40,919 35,440 40,833 (12,980) 5,748 Changes of assumptions - - (4,262) - - Benefit payments, including refunds (83,202) (77,873) (71,884) (69,246) (64,519) Net changes in Total Pension L iabilit y 107,901 94,170 93,380 42,124 59,213 Beginnin g of Year 1,566,983 1,472,813 1,379,433 1,337,309 1,278,096 End of Ye ar 1,674,884$ 1,566,983 $ 1,472,813 $ 1,379,433 $ 1,337,309 $ Plan Fiduciary Net Position:

Contributions - employer 28,621 $ 22,236 $ 22,017 $ 20,144 $ 16,554 $ Contributions - employee 18,833 14,894 15,493 13,750 11,028 Net Investment Income 169,858 164,014 (132,625) 407,811 20,109 Benefit Payments including Refunds, PRSB (83,202) (77,873) (71,884) (69,246) (64,519) Administrative & Professional Expense (2,319) (2,146) (2,050) (2,058) (1,749) Net changes in Plan Fiduciar y Net Position 131,791 121,125 (169,049) 370,401 (18,577) Beginnin g of Year 1,683,313 1,562,188 1,731,237 1,360,836 1,379,413 End of Ye ar 1,815,104$ 1,683,313 $ 1,562,188 $ 1,731,237 $ 1,360,836 $ Net Pension L iability (Asset) (140,220)$ (116,330) $ (89,375) $ (351,804) $ (23,527) $ Fiduciary Net Position as a
pe rcentage of Total Pension L iability 108.37% 107.42% 106.07% 125.50% 101.76% Covered Payroll 213,088$ 186,219 $ 164,642 $ 154,031 $ 149,403 $ Net Pension L iability (Asset) as a % of Payroll -65.80% -62.47% -54.28% -228.40% -15.75% (1) Covered payroll represents payroll in which contributions to the Systems are based. * 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.
(Last Ten Fiscal Years)
Pension Trust Funds
Empl oyees Retirement S ystem
City of Fresno
Required Supplementary Information (Unaudited) (Continued) Schedule of Changes in the Net Pension Liability (Asset) and Related Ratios (Continued) Last Ten Fiscal Years
(amounts in thousands)

157
Change in Net Pension L iabilit y (Asset) (in thousands) For the Fiscal Year Ended: 6/30/2020 6/30/2019 6/30/ 2018 6/30/2017 6/30/2016 Reporting Date: 6/30/2020 6/30/2019 6/30/2018 6/30/2017 6/30/2016 Measurement Date: 6/30/2019 6/30/2018 6/30/2017 6/30/2016 6/30/2015 Total Pension Liability:

Service Cost 23,509 $ 21,275 $ 18,885 $ 18,687 $ 18,476 $ Interest 86,110 82,833 79,266 79,762 78,212 Differences between expected & actual experience (446) (4,164) 5,264 (24,394) (24,691) Changes of assumptions 35,773 2,939 - 9,612 - Benefit payments, including refunds (62,144) (57,666) (55,550) (52,529) (50,546) Net changes in Total Pension L iabilit y 82,802 45,217 47,865 31,138 21,451 Beginnin g of Year 1,195,294 1,150,077 1,102,212 1,071,074 1,049,623 End of Ye ar 1,278,096$ 1,195,294 $ 1,150,077 $ 1,102,212 $ 1,071,074 $ Plan Fiduciary Net Position:

Contributions - employe r 14,627$ 14,609 $ 15,205 $ 13,060 $ 12,327 $ Contributions - employee 10,516 10,329 10,181 9,098 8,750 Net Investment Income 69,389 108,915 162,373 5,089 33,309 Benefit Payments including Refunds, PRSB (62,144) (57,666) (55,550) (52,529) (50,546) Administrative & Professional Expense (1,663) (1,619) (1,387) (1,346) (1,071) Net changes in Plan Fiduciar y Net Position 30,725 74,568 130,822 (26,628) 2,769 Beginnin g of Year 1,348,688 1,274,120 1,143,298 1,169,926 1,167,157 End of Ye ar 1,379,413$ 1,348,688 $ 1,274,120 $ 1,143,298 $ 1,169,926 $ Net Pension Liabilit y (Asset) (101,317)$ (153,394) $ (124,043) $ (41,086) $ (98,852) $ Fiduciary Net Position as a
percentage of Total Pension L iability 107.93% 112.83% 110.79% 103.73% 109.23% Covered Payroll 138,396$ 128,461 $ 119,007 $ 108,541 $ 105,820 $ Net Pension Liabilit y (Asset) as a % of Payroll -73.21% -119.41% -104.23% -37.85% -93.42% Pension Trust Funds
Empl oyees Retirement S ystem
(Last Ten Fiscal Years)

City of Fresno
Required Supplementary Information (Unaudited) (Continued) Schedule of Employer Contribution - Pension Trust Funds Last Ten Fiscal Years
(amounts in thousands)

158

Actuarially Contributions in Contribution Contributions as Fiscal Year Determined Relation to Deficiency Covered a Percentage of Ending June 30 Contribution (ADC)
1 the ADC (Excess) Payroll Covered Payroll
2025 $ 28,884 $ 28,884 - 150,039$ 19.25% 2024 30,635 30,635 - 145,669 21.03% 2023 27,068 27,068 - 134,252 20.16% 2022 27,556 27,556 - 122,634 22.47% 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% Actuarially Contributions in Contribution Contributions as Fiscal Year Determined Relation to Deficiency Covered a Percentage of Ending June 30 Contribution (ADC)
1 the ADC (Excess) Payroll Covered Payroll
2025 $ 29,068 $ 29,068 - 219,481$ 13.24% 2024 28,621 28,621 - 213,088 13.43% 2023 22,236 22,236 - 186,219 11.94% 2022 22,017 22,017 - 164,642 13.37% 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% 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, 2023, will impact the contribution rate for the fiscal year ended June 30, 2025.

Fire and Police Retirement S ystem
Empl oyee Retirement S ystem
City of Fresno
Required Supplementary Information (Unaudited) (Continued) Schedule of Changes in the Total OPEB Liability and Related Ratios Last Ten Fiscal Years
(amounts in thousands)

159

2025 2024 2023 2022 2021 2020 2019 2018
For the Measurement Period: 2023-2024 2022-2023 2021-2022 2020-2021 2019-2020 2018-2019 2017-2018 2016-20172 Total OPE B L iability:

Service cost 5,506 $ 8,243 $ 6,908 $ 6,603 $ 10,052 $ 10,885 $ 5,777 $ 4,769 $ Interest on the total OPEB liability 4,725 4,179 3,946 3,221 3,045 3,012 3,688 2,996 Difference between expected
and actual experience - 1,645 - (19,028) - (7,800) - 416 Changes in assumptions (22,624) (13,448) 2,444 (40,728) (6,622) 30,936 13,406 - Benefit payments (2,937) (2,153) (2,077) (2,912) (2,542) (2,061) (1,991) - Net changes in Total OPEB Liability (15,330) (1,534) 11,221 (52,844) 3,933 34,972 20,880 8,181 Beginning of year 109,448 110,982 99,761 152,605 148,672 113,700 92,820 84,639 End of year 94,118$ 109,448 $ 110,982 $ 99,761 $ 152,605 $ 148,672 $ 113,700 $ 92,820 $ Covered-employee payroll
as of December 31
1 372,439$ 359,844 $ 304,801 $ 294,493 $ 257,132 $ 250,860 $ 236,134 $ 223,664 $ Total OPEB liability as a % of payroll 25.27% 30.42% 36.41% 33.88% 59.35% 59.26% 48.15% 41.50% 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. 1Covered-employee payroll used in the most recent valuation was calculated based on mid-year, as it was considered representative of the payroll duri ng the fiscal year.

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.
2Information only presented from the implementation year.

160
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SUPPLEMENTARY INFORMATION
161
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162

NON-MAJOR GOVERNMENTAL FUNDS
163
Fresno
High Speed Revitalization Special
Rail Corporation Gas Tax Measure C Measure P
Fund Fund Fund Fund Fund
ASSETS
Cash and investments 5,011 $ - $ 22,227$ 22,754 $ 61,829 $ Restricted cash and investments - 155 - - - Accounts receivables, net - - - - - Interest receivable 40 - 195 140 531 Lease receivable - - - - - Grants receivable 12 - - 6,646 - Intergovernmental receivable - - 3,909 3,215 8,349 Loan, note, and other receivables, net - - - - - Inventories and prepaid items - - - 70 - Property held for resale - - - - - Total assets 5,063$ 155 $ 26,331 $ 32,825 $ 70,709 $

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES, AND FUND BALANCES
Liabilities:

Accounts payable 75 $ - $ 1,597$ 2,059 $ 2,152 $ Salaries payable 28 112 306 241 707 Retention payable - - 845 668 339 Deposits from others - - - - - Unearned revenue - - - - - Advances from other funds - - - - - Total liabilities 103 112 2,748 2,968 3,198

DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - - - 1,196 - Related to leases - - - - - Total deferred inflows of resources - - - 1,196 -

Fund Balances:

Nonspendable - - - 70 - Restricted 4,960 43 23,583 28,591 67,511 Assigned - - - - - Total fund balances 4,960 43 23,583 28,661 67,511 Total liabilities, deferred inflows of
resources, and fund balances 5,063$ 155 $ 26,331 $ 32,825 $ 70,709 $ (Continued)
(amounts in thousands)
Special Revenue Funds
City of Fresno
June 30, 2025
Non-Major Governmental Funds
Combining Balance Sheet
See accompanying Notes to the Basic Financial Statements. 164
Low and
Community UGM Fresno Moderate Income Special
Services Impact Fees E.I.F.D. Housing Assessments
Fund Fund Fund Fund Fund
ASSETS
Cash and investments 10,827 $ 84,328 $ 1,389 $ - $ 17,199$ Restricted cash and investments - - - 6,856 - Accounts receivables, net 501 - - - - Interest receivable 75 720 3 - 134 Lease receivable 288 - - - - Grants receivable 1,201 - - - - Intergovernmental receivable 4 - - - 164 Loan, note, and other receivables, net - - - 24,024 - Inventories and prepaid items - - - - - Property held for resale - - - 3,126 - Total assets 12,896$ 85,048 $ 1,392 $ 34,006 $ 17,497 $

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES, AND FUND BALANCES
Liabilities:

Accounts payable 2,982 $ 504 $ - $ - $ 213 $ Salaries payable 94 19 - - 125 Retention payable 44 408 - - - Deposits from others 31 - - - - Unearned revenue 432 - - - - Advances from other funds - 263 - - - Total liabilities 3,583 1,194 - - 338

DEFERRED INFLOWS OF RESOURCES
Unavailable revenue 1,169 - - - - Related to leases 155 - - - - Total deferred inflows of resources 1,324 - - - -

Fund Balances:

Nonspendable - - - 3,126 - Restricted 7,989 83,854 1,392 30,880 17,159 Assigned - - - - - Total fund balances 7,989 83,854 1,392 34,006 17,159 Total liabilities, deferred inflows of
resources, and fund balances 12,896$ 85,048 $ 1,392 $ 34,006 $ 17,497 $ (Continued)
Special Revenue Funds
(amounts in thousands)
City of Fresno
June 30, 2025
Combining Balance Sheet (Continued)
Non-Major Governmental Funds
See accompanying Notes to the Basic Financial Statements. 165
Capital Projects
Funds
Financing Total
Authorities City Non-Major
City Debt and Corporations Combined Governmental
Fund Fund Fund Funds
ASSETS
Cash and investments 42 $ 2,152 $ 33,900 $ 261,658 $ Restricted cash and investments 43 195 - 7,249 Accounts receivables, net - - - 501 Interest receivable 10 - 272 2,120 Lease receivable - - - 288 Grants receivable - - - 7,859 Intergovernmental receivable - - - 15,641 Loan, note, and other receivables, net - - - 24,024 Inventories and prepaid items - - - 70 Property held for resale - - - 3,126 Total assets 95$ 2,347 $ 34,172 $ 322,536 $

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES, AND FUND BALANCES
Liabilities:

Accounts payable - $ 30 $ 931 $ 10,543 $ Salaries payable - - 19 1,651 Retention payable - - 363 2,667 Deposits from others - - - 31 Unearned revenue - - - 432 Advances from other funds - - - 263 Total liabilities - 30 1,313 15,587

DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - - - 2,365 Related to leases - - - 155 Total deferred inflows of resources - - - 2,520

Fund Balances:

Nonspendable - - - 3,196 Restricted 95 2,317 - 268,374 Assigned - - 32,859 32,859 Total fund balances 95 2,317 32,859 304,429 Total liabilities, deferred inflows of
resources, and fund balances 95$ 2,347 $ 34,172 $ 322,536 $ (Concluded)
Non-Major Governmental Funds
Debt Service Funds
(amounts in thousands)
City of Fresno
June 30, 2025
Combining Balance Sheet (Continued)
See accompanying Notes to the Basic Financial Statements. 166
Fresno
High Speed Revitalization Special
Rail Corporation Gas Tax Measure C Measure P
Fund Fund Fund Fund Fund
REVENUES:

Taxes - $ - $ - $ 57,841$ 46,117 $ Licenses and permits - - - - - Intergovernmental 44 - 29,864 8 - Charges for services 1,429 204 - - 17 Fines, forfeitures and penalties - - - - - Use of money and property 231 - 1,298 803 1,955 Miscellaneous - - 321 182 1 Total revenues 1,704 204 31,483 58,834 48,090

EXPENDITURES:

Current:

General government - - - - - Public protection - - - - - Public ways and facilities - - - - 24,047 Culture and recreation 418 - 19,837 15,807 2,184 Community development - 215 - - 929 Capital outlay 959 - 9,084 40,577 13,677 Debt service:

Principal - - - - - Interest - - - - - Total expenditures 1,377 215 28,921 56,384 40,837

REVENUES OVER (UNDER) EXPENDITURES 327 (11) 2,562 2,450 7,253 OTHER FINANCING SOURCES (USES):

Proceeds from sale of property - - - 1,311 - Transfers in 1,280 - 367 702 22 Transfers out (186) - (852) (1,516) (338) Total other financing sources (uses) 1,094 - (485) 497 (316) NET CHANGE IN FUND BALANCES 1,421 (11) 2,077 2,947 6,937 FUND BALANCES:

Beginning of year 3,539 54 21,506 25,714 60,574 End of year 4,960 $ 43 $ 23,583$ 28,661 $ 67,511 $ (Continued)
City of Fresno
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Non-Major Governmental Funds
For the Year Ended June 30, 2025
Special Revenue Funds
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 167
Low and
Community UGM Fresno Moderate Income Special
Services Impact Fees E.I.F.D. Housing Assessments
Fund Fund Fund Fund Fund
REVENUES:

Taxes 2,152 $ - $ 1,060$ - $ - $ Licenses and permits - - - - - Intergovernmental 3,078 - - - - Charges for services 3,992 21,970 - 1 12,200 Fines, forfeitures and penalties 346 - - - - Use of money and property 826 4,562 20 16 884 Miscellaneous 10 19 - - 8 Total revenues 10,404 26,551 1,080 17 13,092

EXPENDITURES:

Current:

General government 552 - - - - Public protection 2,793 291 - - - Public ways and facilities 1,105 207 - - - Culture and recreation 835 9,375 25 - 10,637 Community development 2,810 - - 1,319 - Capital outlay 1,736 4,860 - - 132 Debt service:

Principal - - - - - Interest - - - - - Total expenditures 9,831 14,733 25 1,319 10,769

REVENUES OVER (UNDER) EXPENDITURES 573 11,818 1,055 (1,302) 2,323 OTHER FINANCING SOURCES (USES):

Proceeds from sale of property - - - - - Transfers in 1,213 1,252 - 250 4 Transfers out (1,112) (2,961) - - (177) Total other financing sources (uses) 101 (1,709) - 250 (173) NET CHANGE IN FUND BALANCES 674 10,109 1,055 (1,052) 2,150 FUND BALANCES:

Beginning of year 7,315 73,745 337 35,058 15,009 End of year 7,989 $ 83,854 $ 1,392 $ 34,006 $ 17,159 $ (Continued)
Special Revenue Funds
City of Fresno
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Non-Major Governmental Funds
For the Year Ended June 30, 2025
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 168
Capital Projects
Funds
Financing Total
Authorities City Non-Major
City Debt and Corporations Combined Governmental
Fund Fund Fund Funds
REVENUES:

Taxes -$ - $ - $ 107,170$ Licenses and permits - - - - Intergovernmental - - - 32,994 Charges for services - - 1,712 41,525 Fines, forfeitures and penalties - - - 346 Use of money and property 83 (24) 2,488 13,142 Miscellaneous - - 9 550 Total revenues 83 (24) 4,209 195,727

EXPENDITURES:

Current:

General government 1 6 - 559 Public protection - - 1,599 4,683 Public ways and facilities - - 158 25,517 Culture and recreation - - 229 59,347 Community development - - 27 5,300 Capital outlay - - 2,622 73,647 Debt service:

Principal 11,790 6,150 - 17,940 Interest 4,402 4,209 - 8,611 Total expenditures 16,193 10,365 4,635 195,604

REVENUES OVER (UNDER) EXPENDITURES (16,110) (10,389) (426) 123 OTHER FINANCING SOURCES (USES):

Proceeds from sale of property - - - 1,311 Transfers in 16,147 10,336 2,889 34,462 Transfers out - - (68) (7,210) Total other financing sources (uses) 16,147 10,336 2,821 28,563 NET CHANGE IN FUND BALANCES 37 (53) 2,395 28,686 FUND BALANCES:

Beginning of year 58 2,370 30,464 275,743 End of year 95 $ 2,317 $ 32,859 $ 304,429 $ (Concluded)
Debt Service Funds
City of Fresno
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Non-Major Governmental Funds
For the Year Ended June 30, 2025
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 169
Variance with
Final Budget
Actual Favorable/
Original Final Amounts (Unfavorable)
REVENUES:

Intergovernmental 1,001 $ 1,001 $ 44 $ (957) $ Charges for services 950 1,160 1,429 269 Use of money and property 78 78 231 153 Total revenues 2,029 2,239 1,704 (535) EXPENDITURES:

Current:

Culture and recreation 1,788 2,004 418 1,586 Capital outlay 481 481 959 (478) Total expenditures 2,269 2,485 1,377 1,108

REVENUES OVER
(UNDER) EXPENDITURES (240) (246) 327 573

OTHER FINANCING SOURCES (USES):

Transfers in 23 23 1,280 1,257 Transfers out - - (186) (186) Total other financing sources (uses) 23 23 1,094 1,071 NET CHANGE IN FUND BALANCES (217)$ (223) $ 1,421 1,644 $ FUND BALANCES:

Beginning of year 3,539
End of year 4,960$
City of Fresno
Schedule of Revenues, Expenditures, and Changes in Fund Balance ‐ Budget and Actual High Speed Rail Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
(amounts in thousands)
170
Variance with
Final Budget
Actual Favorable/
Original Final Amounts (Unfavorable)
REVENUES:

Intergovernmental 27,448 $ 27,448 $ 29,864 $ 2,416 $ Use of money and property 164 164 1,298 1,134 Miscellaneous 355 355 321 (34) Total revenues 27,967 27,967 31,483 3,516 EXPENDITURES:

Current:

Culture and recreation 26,494 28,877 19,837 9,040 Capital outlay 7,651 14,977 9,084 5,893 Total expenditures 34,145 43,854 28,921 14,933

REVENUES OVER
(UNDER) EXPENDITURES (6,178) (15,887) 2,562 18,449

OTHER FINANCING SOURCES (USES):

Transfers in - - 367 367 Transfers out - - (852) (852) Total other financing sources (uses) - - (485) (485) NET CHANGE IN FUND BALANCES (6,178)$ (15,887) $ 2,077 17,964 $ FUND BALANCES:

Beginning of year 21,506
End of year 23,583$
City of Fresno
Schedule of Revenues, Expenditures, and Changes in Fund Balance ‐ Budget and Actual Special Gas Tax Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
(amounts in thousands)
171
Variance with
Final Budget
Actual Favorable/
Original Final Amounts (Unfavorable)
REVENUES:

Taxes - $ - $ 57,841$ 57,841 $ Intergovernmental 1,650 1,650 8 Use of money and property 144 144 803 659 Miscellaneous 205 205 182 (23) Total revenues 1,999 1,999 58,834 58,477 EXPENDITURES:

Current:

Culture and recreation 24,748 32,352 15,807 16,545 Community development 400 423 - 423 Capital outlay 61,345 83,759 40,577 43,182 Total expenditures 86,493 116,534 56,384 60,150

REVENUES OVER
(UNDER) EXPENDITURES (84,494) (114,535) 2,450 116,985

OTHER FINANCING SOURCES (USES):

Proceeds from sale of property - - 1,311 1,311 Transfers in 35 35 702 667 Transfers out (375) (375) (1,516) (1,141) Total other financing sources (uses) (340) (340) 497 837 NET CHANGE IN FUND BALANCES (84,834)$ (114,875) $ 2,947 117,822 $ FUND BALANCES:

Beginning of year 25,714
End of year 28,661$
City of Fresno
Schedule of Revenues, Expenditures, and Changes in Fund Balance ‐ Budget and Actual Measure C Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
(amounts in thousands)
172
Variance with
Final Budget
Actual Favorable/
Original Final Amounts (Unfavorable)
REVENUES:

Taxes - $ - $ 46,117$ 46,117 $ Charges for services 9 9 17 8 Use of money and property 652 652 1,955 1,303 Miscellaneous - - 1 1 Total revenues 661 661 48,090 47,429 EXPENDITURES:

Current:

Public ways and facilities 45,102 47,342 24,047 23,295 Culture and recreation 2,608 2,806 2,184 622 Community development 1,344 1,344 929 415 Capital outlay 38,441 43,813 13,677 30,136 Total expenditures 87,495 95,305 40,837 54,468

REVENUES OVER
(UNDER) EXPENDITURES (86,834) (94,644) 7,253 101,897

OTHER FINANCING SOURCES (USES):

Transfers in - - 22 22 Transfers out - - (338) (338) Total other financing sources (uses) - - (316) (316) NET CHANGE IN FUND BALANCES (86,834)$ (94,644) $ 6,937 101,581 $ FUND BALANCES:

Beginning of year 60,574
End of year 67,511$
City of Fresno
Schedule of Revenues, Expenditures, and Changes in Fund Balance ‐ Budget and Actual Measure P Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
(amounts in thousands)
173
Variance with
Final Budget
Actual Favorable/
Original Final Amounts (Unfavorable)
REVENUES:

Taxes 529 $ 529 $ 2,152 $ 1,623 $ Intergovernmental 3,599 3,599 3,078 (521) Charges for services 8,560 10,155 3,992 (6,163) Fines, forfeitures and penalties 75 75 346 271 Use of money and property 169 169 826 657 Miscellaneous - 10 10 - Total revenues 12,932 14,537 10,404 (4,133) EXPENDITURES:

Current:

General government 552 552 552 - Public protection 2,794 2,794 2,793 1 Public ways and facilities 1,827 1,987 1,105 882 Culture and recreation 5,096 6,360 835 5,525 Community development 2,550 2,550 2,810 (260) Capital outlay 2,270 4,390 1,736 2,654 Total expenditures 15,089 18,633 9,831 8,802

REVENUES OVER
(UNDER) EXPENDITURES (2,157) (4,096) 573 4,669

OTHER FINANCING SOURCES (USES):

Transfers in 616 616 1,213 597 Transfers out (701) (701) (1,112) (411) Total other financing sources (uses) (85) (85) 101 186 NET CHANGE IN FUND BALANCES (2,242)$ (4,181) $ 674 4,855 $ FUND BALANCES:

Beginning of year 7,315
End of year 7,989$
City of Fresno
Schedule of Revenues, Expenditures, and Changes in Fund Balance ‐ Budget and Actual Community Services Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
(amounts in thousands)
174
Variance with
Final Budget
Actual Favorable/
Original Final Amounts (Unfavorable)
REVENUES:

Charges for services 13,786 $ 13,786 $ 21,970 $ 8,184 $ Use of money and property 661 661 4,562 3,901 Miscellaneous - - 19 19 Total revenues 14,447 14,447 26,551 12,104 EXPENDITURES:

Current:

Public protection 291 291 291 - Public ways and facilities 465 489 207 282 Culture and recreation 9,871 19,079 9,375 9,704 Capital outlay 30,981 38,745 4,860 33,885 Total expenditures 41,608 58,604 14,733 43,871

REVENUES OVER
(UNDER) EXPENDITURES (27,161) (44,157) 11,818 55,975

OTHER FINANCING SOURCES (USES):

Transfers in - - 1,252 1,252 Transfers out (4,437) (4,437) (2,961) 1,476 Total other financing sources (uses) (4,437) (4,437) (1,709) 2,728 NET CHANGE IN FUND BALANCES (31,598)$ (48,594) $ 10,109 58,703 $ FUND BALANCES:

Beginning of year 73,745
End of year 83,854$
City of Fresno
Schedule of Revenues, Expenditures, and Changes in Fund Balance ‐ Budget and Actual UGM Impact Fees Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
(amounts in thousands)
175
Variance with
Final Budget
Actual Favorable/
Original Final Amounts (Unfavorable)
REVENUES:

Charges for services - $ - $ 1 $ 1 $ Use of money and property - - 16 16 Total revenues - - 17 17 EXPENDITURES:

Current:

Community development - - 1,319 (1,319) Total expenditures - - 1,319 (1,319)

REVENUES OVER
(UNDER) EXPENDITURES - - (1,302) (1,302)

OTHER FINANCING SOURCES (USES):

Transfers in - - 250 250 Total other financing sources (uses) - - 250 250 NET CHANGE IN FUND BALANCES -$ - $ (1,052) (1,052) $ FUND BALANCES:

Beginning of year 35,058
End of year 34,006$
City of Fresno
Schedule of Revenues, Expenditures, and Changes in Fund Balance ‐ Budget and Actual Low and Moderate Income Housing Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
(amounts in thousands)
176
Variance with
Final Budget
Actual Favorable/
Original Final Amounts (Unfavorable)
REVENUES:

Charges for services 8,673 $ 8,673 $ 12,200 $ 3,527 $ Use of money and property 173 173 884 711 Miscellaneous 11 11 8 (3) Total revenues 8,857 8,857 13,092 4,235 EXPENDITURES:

Current:

Culture and recreation 12,254 14,662 10,637 4,025 Capital outlay 1,316 1,316 132 1,184 Total expenditures 13,570 15,978 10,769 5,209

REVENUES OVER
(UNDER) EXPENDITURES (4,713) (7,121) 2,323 9,444

OTHER FINANCING SOURCES (USES):

Transfers in 406 406 4 (402) Transfers out (240) (240) (177) 63 Total other financing sources (uses) 166 166 (173) (339) NET CHANGE IN FUND BALANCES (4,547)$ (6,955) $ 2,150 9,105 $ FUND BALANCES:

Beginning of year 15,009
End of year 17,159$
City of Fresno
Schedule of Revenues, Expenditures, and Changes in Fund Balance ‐ Budget and Actual Special Assessments Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
(amounts in thousands)
177
Variance with
Final Budget
Actual Favorable/
Original Final Amounts (Unfavorable)
REVENUES:

Charges for services 2,648 $ 2,648 $ 1,712 $ (936) $ Use of money and property 37 37 2,488 2,451 Miscellaneous 16 16 9 (7) Total revenues 2,701 2,701 4,209 1,508 EXPENDITURES:

Current:

Public protection 1,599 1,599 1,599 - Public ways and facilities 230 236 158 78 Culture and recreation 128 151 229 (78) Community development 2,677 2,677 27 2,650 Capital outlay 27,782 51,291 2,622 48,669 Total expenditures 32,416 55,954 4,635 51,319

REVENUES OVER
(UNDER) EXPENDITURES (29,715) (53,253) (426) 52,827

OTHER FINANCING SOURCES (USES):

Capital financing activity 12,206 34,171 - (34,171) Transfers in 1,188 1,188 2,889 1,701 Transfers out - - (68) (68) Total other financing sources (uses) 13,394 35,359 2,821 (32,538) NET CHANGE IN FUND BALANCES (16,321)$ (17,894) $ 2,395 20,289 $ FUND BALANCES:

Beginning of year 30,464
End of year 32,859$
City of Fresno
Schedule of Revenues, Expenditures, and Changes in Fund Balance ‐ Budget and Actual City Combined Capital Projects Fund
For the Year Ended June 30, 2025
Budgeted Amounts
(amounts in thousands)
178

NON-MAJOR ENTERPRISE FUNDS
179
Total
Community Parks and Non-major
Sanitation Recreation Enterprise
Fund Fund Funds
ASSETS
Current assets:

Cash and investments 7,057 $ - $ 7,057$ Accounts receivables, net 2,093 - 2,093 Interest receivable 24 16 40 Lease receivable - 239 239 Total current assets 9,174 255 9,429 Noncurrent assets:

Restricted cash and investments - 1,864 1,864 Lease receivable - non-current - 507 507 Net pension asset 3,812 - 3,812 Other assets - 11 11 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 and amortization (67) (2,795) (2,862) Total capital assets - 1,082 1,082 Total noncurrent assets 3,812 3,464 7,276 Total assets 12,986 3,719 16,705

DEFERRED OUTFLOWS OF RESOURCES
Pension contributions 892 - 892 Related to pensions 466 - 466 Related to OPEB 280 - 280 Total deferred outflow of resources 1,638 - 1,638 June 30, 2025
Non-Major Enterprise Funds
Combining Statement of Net Position
City of Fresno
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 180
Total
Community Parks and Non-major
Sanitation Recreation Enterprise
Fund Fund Funds

LIABILITIES
Current liabilities:

Accounts payable 96$ - $ 96 $ Salaries payable 192 10 202 Interest payable - 15 15 Compensated absences and HRA 69 3 72 Bonds payable - 70 70 Total OPEB liability 30 - 30 Total current liabilities 387 98 485 Noncurrent liabilities:

Compensated absences and HRA 659 6 665 Bonds payable - 1,238 1,238 Total OPEB liability 1,090 - 1,090 Total noncurrent liabilities 1,749 1,244 2,993 Total liabilities 2,136 1,342 3,478

DEFERRED INFLOWS OF RESOURCES
Related to leases 1,002 - 1,002 Related to pensions - 876 876 Related to OPEB 878 - 878 Total deferred inflows of resources 1,880 876 2,756

NET POSITION
Net investment in capital assets - (226) (226) Restricted for net pension asset 3,812 - 3,812 Unrestricted 6,796 1,727 8,523 Total net position 10,608$ 1,501 $ 12,109 $ (amounts in thousands)
June 30, 2025
City of Fresno
Combining Statement of Net Position (Continued)
Non-Major Enterprise Funds
See accompanying Notes to the Basic Financial Statements. 181
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182
Total
Community Parks and Non-major
Sanitation Recreation Enterprise
Fund Fund Funds
OPERATING REVENUES:

Charges for services 9,431 $ 486 $ 9,917 $ Total operating revenues 9,431 486 9,917 OPERATING EXPENSES:

Personnel services 5,123 228 5,351 Contractual services (211) - (211) Materials and supplies 512 - 512 Interdepartmental charges 2,936 7 2,943 Depreciation - 189 189 Total operating expenses 8,360 424 8,784

OPERATING INCOME 1,071 62 1,133 NONOPERATING REVENUES (EXPENSES):

Interest income 85 63 148 Net increase (descrease) in cash fair value 83 - 83 Interest expense - (48) (48) Total nonoperating revenues (expenses) 168 15 183

INCOME BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS 1,239 77 1,316

CAPITAL CONTRIBUTIONS AND TRANSFERS
Transfers in 4,447 - 4,447 Transfers out (1,510) - (1,510) Total capital contributions and transfers 2,937 - 2,937 Changes in net position 4,176 77 4,253 NET POSITION:

Beginning of year 6,432 1,424 7,856 End of year 10,608$ 1,501 $ 12,109 $ Non-Major Enterprise Funds
For the Year Ended June 30, 2025
City of Fresno
Combining Statement of Revenues, Expenses, and Changes in Net Position (amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 183
Total
Community Parks and Non-major
Sanitation Recreation Enterprise
Fund Fund Funds
CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from customers 10,074 $ 952 $ 11,026 $ Cash payments to suppliers for goods and services (3,502) (18) (3,520) Cash payments to employees for services (5,770) (466) (6,236) Net cash provided by operating activities 802 468 1,270

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Interest payments on capital-related debt - (62) (62) Principal payments on capital-related debt - (70) (70) Net cash (used in) capital and related financing activities - (132) (132) CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:

Repayment of interfund borrowing (lending) (140) - (140) Transfers in 4,447 - 4,447 Transfers out (1,510) - (1,510) Net cash provided by noncapital financing activities 2,797 - 2,797 CASH FLOWS FROM INVESTING ACTIVITIES:

Interest from investments 171 59 230 Net cash provided by investing activities 171 59 230 Net change in cash and cash equivalents 3,770 395 4,165 CASH AND CASH EQUIVALENTS:

Beginning of year 3,287 1,469 4,756 End of year 7,057$ 1,864 $ 8,921 $

RECONCILIATION OF CASH AND CASH
EQUIVALENTS TO STATEMENT OF NET POSITION:

Cash and cash investments 7,057 $ - $ 7,057$ Restricted cash and investments - 1,864 1,864 Total cash and cash equivalents 7,057$ 1,864 $ 8,921 $ For the Year Ended June 30, 2025
City of Fresno
Combining Statement of Cash Flows
Non-Major Enterprise Funds
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 184
Total
Community Parks and Non-Major
Sanitation Recreation Enterprise
Fund Fund Funds

RECONCILIATION OF OPERATING INCOME TO NET
CASH PROVIDED BY OPERATING ACTIVITIES:

Operating income 1,071$ 62 $ 1,133 $ Adjustments to reconcile operating income to net
cash provided by operating activities:

Depreciation and amortization - 189 189 Changes in operating assets and liabilities, and
deferred outflows and inflows of resources:

Accounts receivables, net 281 - 281 Lease receivable - 465 465 Net pension asset (384) - (384) Other assets - 1 1 Deferred outflows - pension related (302) - (302) Deferred outflows - OPEB related 60 - 60 Accounts payable (265) (11) (276) Salaries payable (3) - (3) Compensated absences and HRA 93 9 102 Total OPEB liability (168) - (168) Deferred inflows - lease related 362 - 362 Deferred inflows - pension related - (247) (247) Deferred inflows - OPEB related 57 - 57 Total adjustments (269) 406 137 Net cash provided by operating activities 802$ 468 $ 1,270 $ NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES:

Amortization of bond premium and discount (14) $ - $ (14) $ Total noncash capital and related financing activities (14)$ - $ (14) $ (amounts in thousands)
For the Year Ended June 30, 2025
City of Fresno
Combining Statement of Cash Flows (Continued)
Non-Major Enterprise Funds
See accompanying Notes to the Basic Financial Statements. 185
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186

INTERNAL SERVICE FUNDS
187
Employees Retirees Total
Billing and General Risk Healthcare Healthcare Internal Collection Services Management Plan Plan Service
Fund Fund Fund Fund Fund Funds
ASSETS
Current assets:

Cash and investments 10,849 $ 45,604 $ - $ 29,230$ - $ 85,683$ Accounts receivables, net 1,239 20 242 30 - 1,531 Interest receivable 189 533 40 284 - 1,046 Lease receivable - 9 - - - 9 Inventories and prepaid items - 2,375 123 - - 2,498 Total current assets 12,277 48,541 405 29,544 - 90,767 Noncurrent assets:

Restricted cash and investments 2,277 - - - - 2,277 Lease receivable - non-current - 317 - - - 317 Other receivable - 23 - - - 23 Net pension asset 3,754 9,908 - - - 13,662 Capital assets:

Buildings, systems and improvements 125 24,286 - - - 24,411 Machinery and equipment 121 217,641 - - - 217,762 Intangible assets, being amortized - 19,543 - - - 19,543 Construction in progress 179 30,102 - - - 30,281 Less: accumulated depreciation
and amortization (139) (140,152) - - - (140,291) Total capital assets 286 151,420 - - - 151,706 Total noncurrent assets 6,317 161,668 - - - 167,985 Total assets 18,594 210,209 405 29,544 - 258,752

DEFERRED OUTFLOWS OF RESOURCES
Pension contributions 1,683 5,600 - - - 7,283 Related to pensions 831 3,099 - - - 3,930 Related to OPEB 537 1,031 107 - - 1,675 Total deferred outflow of resources 3,051$ 9,730 $ 107 $ - $ - $ 12,888$ City of Fresno
Combining Statement of Net Position
Internal Service Funds
June 30, 2025
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 188
Employees Retirees Total
Billing and General Risk Healthcare Healthcare Internal Collection Services Management Plan Plan Service
Fund Fund Fund Fund Fund Funds

LIABILITIES
Current liabilities:

Accounts payable 379 $ 7,220 $ 979 $ - $ - $ 8,578$ Salaries payable 310 1,216 1,295 - - 2,821 Interest payable - 420 - - - 420 Retention payable - 195 - - - 195 Unearned revenue - 5,846 - 14 - 5,860 Due to other funds - - 2,654 - - 2,654 Compensated absences and HRA 330 562 39 - - 931 Lease and subscription liabillity - 1,366 - - - 1,366 Finance purchase agreement - 6,021 - - - 6,021 Liability for self-insurance - - 42,419 8,300 - 50,719 Total OPEB liability 59 62 (16) - - 105 Total current liabilities 1,078 22,908 47,370 8,314 - 79,670 Noncurrent liabilities:

Deposits held for others 4,998 - - - - 4,998 Compensated absences and HRA 1,337 5,304 292 - - 6,933 Lease and subscription liabillity - 1,505 - - - 1,505 Finance purchase agreement - 36,896 - - - 36,896 Liability for self-insurance - - 241,195 - - 241,195 Total OPEB liability 2,097 2,199 (563) - - 3,733 Total noncurrent liabilities 8,432 45,904 240,924 - - 295,260 Total liabilities 9,510 68,812 288,294 8,314 - 374,930

DEFERRED INFLOWS OF RESOURCES
Related to leases - 306 - - - 306 Related to pensions 1,361 4,205 - - - 5,566 Related to OPEB 1,845 4,427 875 - - 7,147 Total deferred inflows of resources 3,206 8,938 875 - - 13,019

NET POSITION
Net investment in capital assets 286 112,219 - - - 112,505 Restricted for net pension asset 6,031 9,908 - - - 15,939 Unrestricted (deficit) 2,612 20,062 (288,657) 21,230 - (244,753) Total net position (deficit) 8,929$ 142,189 $ (288,657) $ 21,230 $ - $ (116,309)$ June 30, 2025
(amounts in thousands)
Combining Statement of Net Position (Continued)
Internal Service Funds
City of Fresno
See accompanying Notes to the Basic Financial Statements. 189
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190
Employees Retirees Total
Billing and General Risk Healthcare Healthcare Internal Collection Services Management Plan Plan Service
Fund Fund Fund Fund Fund Funds
OPERATING REVENUES:

Charges for services 12,967 $ 117,914 $ 65,607 $ 70,863 $ 9,419 $ 276,770 $ Total operating revenues 12,967 117,914 65,607 70,863 9,419 276,770 OPERATING EXPENSES:

Personnel services 7,608 30,966 6,175 - - 44,749 Contractual services (323) 17,534 11,893 9,187 648 38,939 Materials and supplies 1,209 17,676 57 - - 18,942 Interdepartmental charges 4,049 8,834 826 - - 13,709 Claims - - 70,406 64,763 8,771 143,940 Amortization - 5,201 - - - 5,201 Depreciation 6 18,983 - - - 18,989 Total operating expenses 12,549 99,194 89,357 73,950 9,419 284,469

OPERATING INCOME 418 18,720 (23,750) (3,087) - (7,699) NONOPERATING REVENUES (EXPENSES):

Operating grants - 165 - - - 165 Interest income 685 2,159 (17) 1,106 - 3,933 Net increase (descrease) in cash fair value 228 1,342 - - - 1,570 Interest expense - (1,969) - - - (1,969) Gain (loss) on sale of capital assets - 52 - - - 52 Total nonoperating revenues (expenses) 913 1,749 (17) 1,106 - 3,751

INCOME BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS 1,331 20,469 (23,767) (1,981) - (3,948)

CAPITAL CONTRIBUTIONS AND TRANSFERS
Transfers in 1,573 392 - - - 1,965 Transfers out (161) (4,583) (1,826) - - (6,570) Total capital contributions and transfers 1,412 (4,191) (1,826) - - (4,605) Changes in net position 2,743 16,278 (25,593) (1,981) - (8,553) NET POSITION (DEFICIT):

Beginning of year 6,186 125,911 (263,064) 23,211 - (107,756) End of year 8,929 $ 142,189$ (288,657) $ 21,230 $ - $ (116,309)$ Internal Service Funds
City of Fresno
Combining Statement of Revenues, Expenses, and Changes in Net Position For the Year Ended June 30, 2025
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 191
Employees Retirees Total
Billing and General Risk Healthcare Healthcare Internal Collection Services Management Plan Plan Service
Fund Fund Fund Fund Fund Funds
CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from customers 14,248 $ 104,787 $ 65,612 $ 70,863 $ 9,419 $ 264,929$ Cash payments to suppliers for goods and services (4,774) (42,942) (12,591) (9,187) (648) (70,142) Cash payments to employees for services (7,612) (31,222) (6,153) - - (44,987) Cash payments for claims and refunds - - (47,066) (62,863) (8,771) (118,700) Net cash provided by (used in) operating activities 1,862 30,623 (198) (1,187) - 31,100

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Interest payments on capital-related debt - (1,419) - - - (1,419) Proceeds from issuance of capital-related debt - 14,245 - - - 14,245 Principal payments on capital-related debt - (20,291) - - - (20,291) Proceeds from sale of capital assets - 3,790 - - - 3,790 Acquisition and construction of capital assets (180) (31,258) - - - (31,438) Net cash (used in) capital and related financing activities (180) (34,933) - - - (35,113) CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:

Operating grants received - 497 - - - 497 Interfund borrowing (lending) - 3,833 - - - 3,833 Repayment of interfund borrowing (lending) (13) (12,904) 2,054 - - (10,863) Transfers in 1,573 392 - - - 1,965 Transfers out (161) (4,583) (1,826) - - (6,570) Net cash provided by (used in) noncapital financing
activities 1,399 (12,765) 228 - - (11,138) CASH FLOWS FROM INVESTING ACTIVITIES:

Interest from investments 922 3,413 (30) 1,075 - 5,380 Net cash provided by (used in) investing activities 922 3,413 (30) 1,075 - 5,380 Net change in cash and cash equivalents 4,003 (13,662) - (112) - (9,771) CASH AND CASH EQUIVALENTS:

Beginning of year 9,123 59,266 - 29,342 - 97,731 End of year 13,126 $ 45,604 $ - $ 29,230$ - $ 87,960$

RECONCILIATION OF CASH AND CASH
EQUIVALENTS TO STATEMENT OF NET POSITION:

Cash and cash investments 10,849 $ 45,604 $ - $ 29,230$ - $ 85,683$ Restricted cash and investments 2,277 - - - - 2,277 Total cash and cash equivalents 13,126$ 45,604 $ - $ 29,230$ - $ 87,960$ City of Fresno
For the Year Ended June 30, 2025
Internal Service Funds
Combining Statement of Cash Flows
(amounts in thousands)
See accompanying Notes to the Basic Financial Statements. 192
Employees Retirees Total
Billing and General Risk Healthcare Healthcare Internal Collection Services Management Plan Plan Service
Fund Fund Fund Fund Fund Funds

RECONCILIATION OF OPERATING INCOME (LOSS) TO NET
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:

Operating income (loss) 418 $ 18,720$ (23,750) $ (3,087) $ - $ (7,699)$ Adjustments to reconcile operating income (loss) to net cash provided by operating activities:

Depreciation and amortization 6 24,184 - - - 24,190 Changes in operating assets and liabilities, and
deferred outflows and inflows of resources:

Accounts receivables, net 1,755 (7) 5 (14) - 1,739 Lease receivable - 6 - - - 6 Inventories and prepaid items - 565 (101) - - 464 Net pension asset (683) (2,548) - - - (3,231) Deferred outflows - pension related (390) (2,630) - - - (3,020) Deferred outflows - OPEB related 114 195 21 - - 330 Accounts payable 161 537 286 - - 984 Salaries payable 21 343 157 - - 521 Unearned revenue (75) (13,311) - 14 - (13,372) Compensated absences and HRA (181) 1,046 5 - - 870 Liability for self-insurance - - 23,340 1,900 - 25,240 Total OPEB liability (332) (805) (61) - - (1,198) Deferred inflows - lease related (399) 185 - - - (214) Deferred inflows - pension related 1,361 3,888 - - - 5,249 Deferred inflows - OPEB related 86 255 (100) - - 241 Total adjustments 1,444 11,903 23,552 1,900 - 38,799 Net cash provided by (used in) operating activities 1,862$ 30,623 $ (198) $ (1,187) $ - $ 31,100$ NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES:

Borrowing under capital financing - $ 14,245$ - $ - $ - $ 14,245$ Total noncash capital and related financing activities -$ 14,245$ - $ - $ - $ 14,245$ (amounts in thousands)
Combining Statement of Cash Flows (Continued)
Internal Service Funds
For the Year Ended June 30, 2025
City of Fresno
See accompanying Notes to the Basic Financial Statements. 193
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194

FIDUCIARY FUNDS - PENSION TRUST FUNDS
195
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196
Employees Fire and Police
Retirement Retirement
System System Total
ASSETS
Cash and investments 629$ 796 $ 1,425 $ Total cash and investments 629 796 1,425 Receivables:

Receivables for investments sold 8,490 9,482 17,972 Interest and dividends receivable 1,863 2,262 4,125 Other receivables 980 1,190 2,170 Total receivables 11,333 12,934 24,267 Investments, at fair v\alue:

Short-term investments 8,833 10,724 19,557 Domestic equities 488,147 592,741 1,080,888 International equities 384,295 466,637 850,932 Private equity 154,514 187,621 342,135 Fixed income 245,703 298,350 544,053 Private debt/credit 236,605 287,302 523,907 Real estate 413,795 501,673 915,468 Multi-assets 40,164 48,770 88,934 Total investments 1,972,056 2,393,818 4,365,874 Collateral held for securities lent 21,744 26,404 48,148 Capital assets, net 76 76 152 Other assets 51 51 102 Total assets 2,005,889 2,434,079 4,439,968

LIABILITIES
Accounts payable 8,891 10,796 19,687 Collateral held for securities lent 21,744 26,404 48,148 Other liabilities 1,042 1,273 2,315 Total liabilities 31,677 38,473 70,150

NET POSITION
Restricted for pension benefits 1,974,212 2,395,606 4,369,818 Total net position 1,974,212$ 2,395,606 $ 4,369,818 $ City of Fresno
Combining Statement of Fiduciary Net Position
Fiduciary Funds - Pension Trust Funds
June 30, 2025
(amounts in thousands)
197
Employees Fire and Police
Retirement Retirement
System System Total
ADDITIONS:

Contributions:

Employer 31,558$ 31,779 $ 63,337 $ System members 20,771 13,580 34,351 Total contributions 52,329 45,359 97,688 Investments income:

Net appreciation in fair value of investments 215,446 261,613 477,059 Interest 9,227 11,174 20,401 Dividends 6,060 7,360 13,420 Other investment related 83 83 166 Total investment income 230,816 280,230 511,046 Less: investment expense (32,115) (38,935) (71,050) Total net investment income 198,701 241,295 439,996 Securities lending income:

Securities lending earnings 1,575 1,913 3,488 Less: securities lending expense (1,472) (1,787) (3,259) Total net securities lending income 103 126 229 Total additions 251,133 286,780 537,913 DEDUCTIONS:

Benefit payments (including post-retirement
supplemental benefits) 87,217 90,830 178,047 Refunds of contributions 2,192 941 3,133 General and administrative expenses 2,617 2,774 5,391 Total deductions 92,026 94,545 186,571 Changes in net position 159,107 192,235 351,342 NET POSITION:

Beginning of year 1,815,105 2,203,371 4,018,476 End of year 1,974,212$ 2,395,606 $ 4,369,818 $ City of Fresno
Combining Statement of Changes in Fiduciary Net Position Fiduciary Funds - Pension Trust Funds
For the Year Ended June 30, 2025
(amounts in thousands)
198

FIDUCIARY FUNDS - CUSTODIAL FUNDS
199
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200
City Special Assessment
Departmental Distric t Total
ASSETS
Cash and investments 3,282$ 122 $ 3,404$ Restricted cash and investments - 637 637 Interest receivable 24 1 25 Other receivable 5 - 5 Due from other governments 234 595 829 Total assets 3,545 1,355 4,900

LIABILITIES
Salaries payable 62$ - $ 62$ Due to other governments 3 480 483 Total liabilities 65 480 545

NET POSITION
Restricted for individuals, organizations,
and other governments 3,480 875 4,355 Total net position 3,480$ 875 $ 4,355 $ City of Fresno
Combining Statement of Fiduciary Net Position
Fiduciary Funds - Private Purpose Trust Funds
June 30, 2025
(amounts in thousands)
201
City Special Assessment
Departmental Distric t Total
ADDITIONS:

Fees collected for organizations and other governments 5,300 $ - $ 5,300$ Taxes collected for organizations and other governments 200 - 200 Special assessments for organizations and other governments - 632 632 Investment income 87 2 89 Total additions 5,587 634 6,221 DEDUCTIONS:

Payments to individuals, organizations, and other governments 4,672 1,050 5,722 Total deductions 4,672 1,050 5,722 Changes in net position 915 (416) 499 NET POSITION:

Beginning of year 2,565 1,291 3,856 End of year 3,480$ 875 $ 4,355 $ City of Fresno
Combining Statement of Changes in Fiduciary Net Position Fiduciary Funds - Private Purpose Trust Funds
For the Year Ended June 30, 2025
(amounts in thousands)
202

STATISTICAL SECTION
203
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204
Contents Page
Financial Trends 206
These schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time.

Revenue Capacity 217
These schedules contain information to help the reader assess the City's most significant local revenues source: property tax.

Debt Capacity 221
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.