Fund balances - total governmental funds (page 26) 235,803,523$ Capital assets 983,552,177
Accumulated depreciation (357,522,862)
2,866,388
62,798,700
Long term debt (21,407,014)
Bond premium (1,232,297)
Prepaid bond issuance costs 94,719
Accrued interest payable (322,317)
The pension liability is not due and payable in the current period and, therefore, is not reported in the balance sheet of the governmental funds.
Also, deferred inflows and outflows of resources related to pension costs are deferred and amortized in the statement of activities. This amount is the net effect of the treatment of net pension liability, deferred outflows of resources from pension contributions and deferred inflows of resources for the net difference between projected and actual earnings on pension plan investments. (219,546,286)
Net position of governmental activities 659,757,026$
The notes to basic financial statements are an integral part of this statement.
Certain notes, grants, and accounts receivables are not available to pay for current period expenditures, and therefore are offset by deferred inflows of resources in the governmental funds.
Internal service funds are used by management to charge the costs of various city activities to individual governmental and business-like funds. The assets and liabilities of the internal service funds are included in governmental activities in the statement of net position.
The issuance of long term debt (e.g. bonds, leases) provides current financial resources to governmental funds, while the repayment of the principal of long term debt consumes the current financial resources of governmental funds.
Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts, and similar items when debt is issued, whereas these amounts are deferred and amortized in the statement of activities. This amount is the net effect of these differences in the treatment of long term debt and related items.
The OPEB liability is not due and payable in the current period and, therefore, is not reported in the balance sheet of the governmental funds. Also, deferred inflows and outflows of resources related to OPEB costs are deferred and amortized in the statement of activities. This amount is the net effect of the treatment of OPEB liability and deferred outflows of resources from OPEB contributions. (25,327,705)
Capital assets used in governmental activities are not current financial resources, and therefore are not reported in the governmental funds balance sheet.
CITY OF GARDEN GROVE
RECONCILIATION OF BALANCE SHEET OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF NET POSITION
JUNE 30, 2022
Amounts reported for governmental activities in the statement of net position are different because:
27
CITY OF GARDEN GROVE
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Other Nonmajor Total
General Grants and Governmental Governmental
Fund Contributions Funds Funds
REVENUES:
Taxes 147,355,942$ -$ 3,513,575$ 150,869,517$ Licenses and permits 2,704,550 - 58,149 2,762,699 Fines, forfeits and penalties 1,859,264 686,745 - 2,546,009 Investment earnings (loss) (4,217,678) 149,151 (525,070) (4,593,597) Charges for current services 7,670,580 - 5,630,365 13,300,945 From other agencies 24,654,556 7,419,644 13,247,548 45,321,748 Other revenues 3,367,097 - 127,239 3,494,336 Total revenues 183,394,311 8,255,540 22,051,806 213,701,657 EXPENDITURES:
Current:
Fire 26,975,339 - - 26,975,339 Police 68,181,105 1,001,878 1,938,307 71,121,290 Traffic safety 2,708,284 433,194 2,521,096 5,662,574 Public right of way 6,781,007 2,361,940 9,913,643 19,056,590 Community buildings 3,713,197 - - 3,713,197 Community services 4,805,877 496,624 464,409 5,766,910 Economic development 1,778,841 - 1,812,734 3,591,575 Parks and greenbelts 1,601,155 - 1,351,336 2,952,491 Community planning and development 7,136,889 2,947,235 1,011,380 11,095,504 Municipal support 8,856,198 - 155,063 9,011,261 Debt service:
Principal retirement 541,101 8,837 42,329 592,267 Interest 1,093,121 22 381 1,093,524 Total expenditures 134,172,114 7,249,730 19,210,678 160,632,522 Excess of revenues
over expenditures 49,222,197 1,005,810 2,841,128 53,069,135 OTHER FINANCING SOURCES (USES):
Transfers in 1,443,302 - 831,837 2,275,139 Transfers out (831,837) - (616,344) (1,448,181) Total other financing (uses) 611,465 - 215,493 826,958 Net change in fund balances 49,833,662 1,005,810 3,056,621 53,896,093 Fund balances, beginning of year 112,431,637 5,970,300 63,505,493 181,907,430 Fund balances, end of year 162,265,299$ 6,976,110$ 66,562,114$ 235,803,523$ The notes to basic financial statements are an integral part of this statement. 28
Net change in fund balances - total governmental funds 53,896,093$ Capital outlay 12,475,990
Depreciation expense (11,671,550)
Bond principal payment 592,267
Change in accrued interest 8,591
Amortization of bond premium and deferred items 50,186
152,466
(12,213,949)
(2,804,009)
20,906,388
Change in net position of governmental activities 61,392,473$ The notes to basic financial statements are an integral part of this statement.
The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. This amount is the net effect of these differences in the treatment of long-term debt and related items.
Some revenues in statement of activities that do not provide current financial resources are not reported as revenues in the funds.
Internal service funds are used by management to charge the costs of certain activities, such as workers compensation, fleet management, employee benefits, telephones, information systems, risk management and warehouse operations to individual funds. The net expenses of these internal service funds are reported with governmental activities.
OPEB costs do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds.
Pension costs do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds.
Governmental funds report capital outlays as expenditures. However, in the statement of activities, the cost of those assets is allocated over their estimated useful lives as depreciation expense. This is the amount by which depreciation expenses exceeded capital outlays in the current period.
CITY OF GARDEN GROVE
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Amounts reported for governmental activities in the statement of activities are different because:
29
This page is intentionally blank.
Governmental
Activities -
Water Sewage Housing Total Nonmajor Total Enterprise Internal Service Utility Collection Authority Funds Funds Funds
ASSETS
Current assets:
Cash and cash investments 33,749,549$ 44,704,859$ 3,152,832$ 13,609,548$ 95,216,788$ 112,464,240$ Cash and cash investments with fiscal agents 11,471,505 - - - 11,471,505 - Taxes receivable - 46,332 - 376,800 423,132 - Accounts receivable 6,010,463 1,710,354 5,566 470,915 8,197,298 26,365 Interest receivable 21,623 28,659 1,771 8,564 60,617 74,151 Intergovernmental receivable - - 20,952 - 20,952 - Due from other funds - - - - - 330,941 Inventory - - - 12,589 12,589 476,028 Deposits and prepaid items 6,500 22,672 19,630 89,141 137,943 219,210 Total current assets 51,259,640 46,512,876 3,200,751 14,567,557 115,540,824 113,590,935 Noncurrent assets:
Intercity loans receivable, net - - - - - 4,037,769 Notes receivable - 2,488 - - 2,488 - Capital assets:
Land 1,471,805 537,984 - 3,132,711 5,142,500 - Construction in progress 8,845,483 5,502,366 - 20,325 14,368,174 705,133 Depreciable capital assets, net 86,031,733 65,332,401 202,973 232,050 151,799,157 12,647,083 Total noncurrent assets 96,349,021 71,375,239 202,973 3,385,086 171,312,319 17,389,985 Total assets 147,608,661 117,888,115 3,403,724 17,952,643 286,853,143 130,980,920
DEFERRED OUTFLOWS OF RESOURCES
Unamortized loss on refunding of debt 82,876 - - - 82,876 - OPEB related items 2,125,606 487,844 1,149,918 243,922 4,007,290 1,080,226 Pension related items 2,140,756 1,035,934 850,064 269,056 4,295,810 1,084,025 Total deferred outflows 4,349,238 1,523,778 1,999,982 512,978 8,385,976 2,164,251
LIABILITIES
Current liabilities:
Accounts payable 7,871,579 660,698 97,008 238,778 8,868,063 955,680 Accrued liabilities 364,938 247,688 56,096 9,531 678,253 669,966 Refundable deposits 539,411 - 187,371 1,014,030 1,740,812 - Interest payable 36,887 22,974 - 14 59,875 - Due to other funds 8,406 2,721 1,275 87 12,489 2,177 Current portion of long-term obligations
Leases payable - - 154,675 111,454 266,129 15,976 Accrued compensated absences 610,133 342,005 - - 952,138 7,677,171 Claims payable - - - - - 7,338,593 Long-term debt 1,518,192 717,456 - - 2,235,648 - Total current liabilities 10,949,546 1,993,542 496,425 1,373,894 14,813,407 16,659,563 Noncurrent liabilities:
Noncurrent portion of long-term obligations:
Leases payable - - 33,034 57,586 90,620 - Accrued compensated absences 18,870 10,578 - - 29,448 237,438 Claims payable - - - - - 39,138,753 Intercity loans payable 10,632,394 - - - 10,632,394 1,602,024 Long-term debt 26,823,912 12,840,891 - - 39,664,803 - Net pension liability 10,757,088 5,205,464 4,271,484 1,351,984 21,586,020 5,447,123 OPEB liability 3,524,566 808,917 1,906,732 404,458 6,644,673 1,791,173 Total noncurrent liabilities 51,756,830 18,865,850 6,211,250 1,814,028 78,647,958 48,216,511 Total liabilities 62,706,376 20,859,392 6,707,675 3,187,922 93,461,365 64,876,074
DEFERRED INFLOWS OF RESOURCES
Unamortized gain on refunding of debt - 150,244 - - 150,244 - OPEB related items 817,669 187,662 442,346 93,831 1,541,508 415,537 Pension related items 4,538,450 2,196,202 1,802,154 570,406 9,107,212 2,298,159 Total deferred inflows 5,356,119 2,534,108 2,244,500 664,237 10,798,964 2,713,696
NET POSITION
Net investment in capital assets 68,089,793 57,664,160 202,973 3,216,046 129,172,972 13,336,240 Unrestricted 15,805,611 38,354,233 (3,751,442) 11,397,416 61,805,818 52,219,161 Total net position 83,895,404$ 96,018,393$ (3,548,469)$ 14,613,462$ 190,978,790 65,555,401$ Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds 2,756,701 Net position of business-type activities 193,735,491$
The notes to basic financial statements are an integral part of this statement. - Enterprise Funds
CITY OF GARDEN GROVE
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
JUNE 30, 2022
Business-Type Activities
30
Water Sewage
Utility Collection
Operating revenues:
Charges for services -$ -$
Water sales 43,243,318 -
Section 8 grant revenue - -
Solid waste disposal fees - -
Property assessments 79 4,002,836 Sewer user fees - 8,017,955
Other 12,925 4,240
Total operating revenues 43,256,322 12,025,031
Operating expenses:
Salaries and benefits 7,365,579 3,327,382
Contractual services 7,319,358 2,499,099
Liability claims - -
Materials and supplies 98,052 168,104
Water production expenses 15,639,458 -
Housing - -
Golf course operations - -
Depreciation and amortization 3,869,144 1,890,796 Total operating expenses 34,291,591 7,885,381
Operating income 8,964,731 4,139,650
Nonoperating revenues (expenses):
Investment income (loss) (1,109,708) (1,436,710) Gain on disposal of assets - -
Other nonoperating revenues (expenses) (13,581) - Interest expense (1,248,369) (497,592)
Total nonoperating (expenses) revenues (2,371,658) (1,934,302) Income before transfers and capital contributions 6,593,073 2,205,348 Capital contributions - -
Transfers in - -
Transfers out (38,554) -
Change in net position 6,554,519 2,205,348
Total net position (deficit), beginning of year 77,340,885 93,813,045 Total net position (deficit), end of year 83,895,404$ 96,018,393$ Adjustment to reflect the consolidation of internal service fund activities to enterprise funds.
Change in net position of business-type activities.
The notes to basic financial statements are an integral part of this statement. - Enterprise Funds
CITY OF GARDEN GROVE
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION
PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Business-Type Activities
31
Governmental
Activities -
Housing Total Nonmajor Total Enterprise Internal Service Authority Funds Funds Funds
-$ 1,744,025$ 1,744,025$ 41,609,367$ - - 43,243,318 - 43,355,650 - 43,355,650 -
- 2,519,405 2,519,405 - - 502,231 4,505,146 - - - 8,017,955 - 44,520 919,054 980,739 - 43,400,170 5,684,715 104,366,238 41,609,367
3,414,479 606,783 14,714,223 29,715,440 244,372 1,271,073 11,333,902 3,954,971 - - - 13,968,854 54,608 7,671 328,435 226,517 - - 15,639,458 - 39,647,435 - 39,647,435 -
- 1,647,260 1,647,260 - 162,728 115,522 6,038,190 2,013,626 43,523,622 3,648,309 89,348,903 49,879,408
(123,452) 2,036,406 15,017,335 (8,270,041)
(95,311) (430,490) (3,072,219) (3,707,098) - - - 119,416 - - (13,581) - (261) (376) (1,746,598) (23,370) (95,572) (430,866) (4,832,398) (3,611,052) (219,024) 1,605,540 10,184,937 (11,881,093) - - - 519,953 - - - 38,554 - - (38,554) (826,958) (219,024) 1,605,540 10,146,383 (12,149,544) (3,329,445) 13,007,922 77,704,945
(3,548,469)$ 14,613,462$ 65,555,401$
(454,624)
9,691,759$
Business-Type Activities
- Enterprise Funds
32
Water Sewage
Utility Collection
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers and user departments 44,071,285$ 11,742,438$ Payments to suppliers (20,964,073) (2,745,436)
Payments to employees (8,050,537) (3,342,034)
Payments for employee benefits - -
Net cash provided by operating activities 15,056,675 5,654,968
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES
Cash received from other funds - -
Cash paid to other funds (986,363) (80,237)
Net cash (used) provided by noncapital financing activities (986,363) (80,237)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Purchases of capital assets (8,058,873) (4,641,246) Proceeds from sale of capital assets - 28,183 Principal paid on capital debt (1,068,192) (615,000) Interest paid on capital debt (1,234,317) (582,124)
Net cash (used) by capital and related financing activities (10,361,382) (5,810,187)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest earnings 332,341 519,207
Increase (decrease) in fair value of investments (1,347,001) (1,785,352) Net cash provided by investing activities (1,014,660) (1,266,145) Net (decrease) increase in cash and cash equivalents 2,694,270 (1,501,601) Cash and cash equivalents, beginning of year 42,526,784 46,206,460 Cash and cash equivalents, end of year 45,221,054$ 44,704,859$ The notes to basic financial statements are an integral part of this statement.
CITY OF GARDEN GROVE
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Business-Type Activities
- Enterprise Funds
33
Governmental
Activities -
Housing Total Nonmajor Total Enterprise Internal Service Authority Funds Funds Funds
43,240,138$ 5,681,541$ 104,735,402$ 41,634,588$ (39,872,466) (2,926,159) (66,508,134) (13,696,506) (2,798,013) (697,484) (14,888,068) (14,551,017) - - - (16,109,833) 569,659 2,057,898 23,339,200 (2,722,768)
- - - 2,279,968 (50,407) (21,663) (1,138,670) (469,080) (50,407) (21,663) (1,138,670) 1,810,888
- (56,484) (12,756,603) (1,443,820) - - 28,183 123,884 (163,237) (111,280) (1,957,709) (97,063) (261) (362) (1,817,064) (23,389)
(163,498) (168,126) (16,503,193) (1,440,388)
24,101 145,295 1,020,944 1,347,474 (110,171) (533,508) (3,776,032) (4,619,127) (86,070) (388,213) (2,755,088) (3,271,653) 269,684 1,479,896 2,942,249 (5,623,921) 2,883,148 12,129,652 103,746,044 118,088,161 3,152,832$ 13,609,548$ 106,688,293$ 112,464,240$ (continued)
Business-Type Activities
- Enterprise Funds
34
Water Sewage
Utility Collection
Reconciliation of operating income to net cash
provided by operating activities:
Operating income 8,964,731$ 4,139,650$
Adjustments to reconcile operating income
to net cash provided by operating activities:
Depreciation and amortization expense 3,869,144 1,890,796 Other nonoperating revenues (expenses) (13,581) (28,183) Decrease (increase) in taxes receivable - (8,209) Decrease (increase) in accounts receivable 796,986 (275,937) Decrease (increase) in intergovernmental receivable - - Decrease (increase) in notes receivable - 1,553 Decrease (increase) in inventory - -
Decrease (increase) in prepaid expenses (5,313) (9,065) Increase (decrease) in accounts payable 1,950,285 (58,925) Increase (decrease) in accrued compensated absences 16,009 219,565 Increase (decrease) in accrued liabilities 147,823 17,940 Increase (decrease) in refundable deposits 31,558 - Increase (decrease) in claims payable - - Increase (decrease) in OPEB liability and related
changes in deferred outflows and inflows of resources 332,173 131,481 Increase (decrease) in net pension liability and related changes in deferred outflows and inflows of resources (1,033,140) (365,698) Total adjustments 6,091,944 1,515,318
Net cash provided by operating activities 15,056,675$ 5,654,968$ Non-cash capital and related financing activities
Capital assets contributed from other funds -$ -$ The notes to basic financial statements are an integral part of this statement.
CITY OF GARDEN GROVE
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS (CONTINUED)
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Business-Type Activities
- Enterprise Funds
35
Governmental
Activities-
Housing Total Nonmajor Total Enterprise Internal Service Authority Funds Funds Funds
(123,452)$ 2,036,406$ 15,017,335$ (8,270,041)$ 162,728 115,522 6,038,190 2,013,626 - - (41,764) - - (180,925) (189,134) - 2,554 (281,749) 241,854 25,221 (20,952) - (20,952) - - - 1,553 - - (4,918) (4,918) (46,193) (6,311) 8,104 (12,585) (118,148) 79,464 (3,341) 1,967,483 - - - 235,574 (387,258) 796 (14,078) 152,481 (199,438) (141,634) 459,500 349,424 214,269 - - - 3,920,092 638,396 51,365 1,153,415 150,519 (21,930) (127,988) (1,548,756) (25,417) 693,111 21,492 8,321,865 5,547,273 569,659$ 2,057,898$ 23,339,200$ (2,722,768)$ -$ -$ -$ 519,953$ Business-Type Activities
- Enterprise Funds
36
CITY OF GARDEN GROVE
STATEMENT OF FIDUCIARY NET POSITION
CITY OF GARDEN GROVE AS SUCCESSOR AGENCY
TO THE GARDEN GROVE REDEVELOPMENT AGENCY
PRIVATE PURPOSE TRUST FUND
JUNE 30, 2022
ASSETS
Current assets:
Cash and cash investments 19,115,481$
Cash and cash investments with fiscal agents 4,090,176
Accounts receivable 10,650
Interest receivable 12,394
Total current assets 23,228,701
Noncurrent assets:
Prepaid bond insurance costs 411,885
Land held for resale 25,249,639
Total noncurrent assets 25,661,524
Total assets 48,890,225
DEFERRED OUTFLOWS OF RESOURCES
Unamortized loss on refunding of debt 250,822
Total deferred outflows 250,822
LIABILITIES
Current liabilities:
Accounts payable 97,840
Accrued liabilities 5,103
Interest payable 615,725
Due to other funds 41
Current portion of long-term obligations 5,876,557
Total current liabilities 6,595,266
Noncurrent liabilities:
Noncurrent portion of long-term obligations:
Long-term debt 58,326,007
Total noncurrent liabilities 58,326,007
Total liabilities 64,921,273
NET POSITION
Held in trust for redevelopment dissolution (15,780,226)$ The notes to basic financial statements are an integral part of this statement. 37
CITY OF GARDEN GROVE
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
CITY OF GARDEN GROVE AS SUCCESSOR AGENCY
TO THE GARDEN GROVE REDEVELOPMENT AGENCY
PRIVATE PURPOSE TRUST FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
ADDITIONS
Taxes 3,301,040$
Investment earnings (loss) (618,471)
Other revenues 17,250
Total additions 2,699,819
DEDUCTIONS
Program expenses 580,308
Administrative expenses 508,730
Interest and fiscal agency expenses 1,923,878
Total deductions 3,012,916
CHANGE IN NET POSITION (313,097)
NET POSITION, BEGINNING OF YEAR (15,467,129)
NET POSITION, END OF YEAR (15,780,226)$
The notes to basic financial statements are an integral part of this statement. 38
This page is intentionally blank.
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2022
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
1. Reporting Entity
a.
b.
The City of Garden Grove (the “City”) was incorporated June 18, 1956 as a general law full- service city. The City operates under a council-manager form of government and provides the following services: public safety (police, fire, and paramedics), highways and streets, social services, culture and recreation, parks, planning, zoning, housing, water, solid waste collection and disposal, sewage services and general administration. On May 10, 2016, the City of Garden Grove adopted Ordinance No. 2866 changing the City’s current at-large system of electing City Council Members to a by-district system. It took effect in fiscal year 2016- 2017. The Mayor is elected at-large. City Council members are elected by six districts, and he or she must reside within the designated district boundary.
Accounting principles, generally accepted in the United States of America, require that these financial statements present the City (the primary government) and its component units. Component units generally are legally separate entities for which a primary government is financially accountable. Financial accountability ordinarily involves meeting both of the following criteria: the primary government is accountable for the potential component unit (e.g. the primary government appoints the voting majority of its board) and the primary government is able to impose its will upon the potential component unit, or there is a possibility that the potential component unit may provide specific financial benefits or impose specific financial burdens on the primary government. The component units discussed in this note are included in the City’s reporting entity because of the significance of their operational or financial relationships with the City.
Blended component units:
The Garden Grove Housing Authority (the “Housing Authority”) was established in October 1975, pursuant to the provisions of the Housing and Community Development Act of 1974 and is reported as an enterprise fund as if it were part of the primary government because the governing board is comprised of the City Council, although acting in a different capacity, and two Housing Authority tenants. The Housing Authority governing board approves the Housing Authority budget and the City provides staffing.
The Garden Grove Sanitary District (the “Sanitary District”) began its operations in 1924 as a special district operating under the authority of the State of California. The Health and Safety Code of California (the Sanitary District Act of 1923) is the governing law. The Garden Grove Sanitary District provides the City of Garden Grove, a portion of the City of Santa Ana and County of Orange unincorporated areas with sewer maintenance services including cleaning of sewage collection line and inspection of sewage lines built within the district by developers. Garden Grove has an agreement with Republic Services to provide an exclusive franchise for Solid Waste Handling Services for residents and commercial establishments within the Garden Grove Sanitary District. The district became a subsidiary district and component unit of the City of Garden Grove on May 30, 1997. The Sanitary District is reported as two enterprise funds, the Sewage Collection enterprise fund and Solid Waste Disposal enterprise fund as if it were part of the primary government because the City Council, although acting in a different capacity, is the governing board. Council members approve the Sanitary District budget and the City provides staffing.
39
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
1. Reporting Entity (continued)
c.
2. Government-wide and Fund Financial Statements
3. Measurement Focus, Basis of Accounting, and Financial Statement Presentation The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund and fiduciary fund financial statements. Under the economic resources measurement focus, all (both current and long-term) economic resources and obligations of the reporting government are reported in the government-wide financial statements. Basis of accounting refers to when revenues and expenses are recognized in the accounts and reported in the financial statements. Under the accrual basis of accounting, revenues, expenses, gains, losses, assets, and liabilities resulting from exchange and exchange-like transactions are recognized when the exchange takes place. Expenditure driven grants are recognized as revenue when the qualifying expenditures have been incurred and all other grant requirements have been met. Grant funds received before the revenue recognition criteria have been met are reported as unearned revenues.
The Garden Grove Public Financing Authority (the "Authority") was established on June 22, 1993 as a joint powers agency organized under the laws of the State of California. The Authority was formed to assist in the financing of public and capital improvements. The Authority’s financial data and transactions are included within enterprise funds. The Authority is administered by the Board who are the members of the City Council and the Mayor. Council members approve the Authority budget and the City provides staffing.
Separate reports are not issued for the Garden Grove Housing Authority, the Garden Grove Sanitary District, or the Garden Grove Public Financing Authority.
All components of the reporting entity are reported on a July 1 through June 30 fiscal year.
The government-wide financial statements (i.e. the statement of net position and the statement of activities) report information on all of the non-fiduciary activities of the primary government and its component units. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support.
The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment, 2) operating grants and contributions that are restricted to meeting the operational requirement of a particular function or segment, and 3) capital grants and contributions that are restricted to meeting the capital requirement of a particular function or segment and other miscellaneous revenues that directly benefit a particular function. Taxes and other items not properly included among program revenues are reported instead as general revenues.
Separate financial statements are provided for governmental funds, proprietary funds and the fiduciary fund. Major governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements.
40
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
3. Housing Authority Fund
The Housing Authority Fund accounts for revenues and expenses pertaining to the Federal Section 8 Housing Program.
Other Grants and Contributions Fund
The City is the recipient of numerous other federal, state and county grants, plus contributions from other sources. These grants and contributions are accounted for in this fund.
Water Utility Fund
The purpose of this fund is to account for the City’s water system. Resources of the fund are applied to construction, operation, maintenance and debt service obligations of the water system. Financing is provided by revenue of the water utility.
Sewage Collection Fund
The Garden Grove Sanitary District comprises two funds, the Sewage Collection Fund and the Solid Waste Disposal Fund. Resources of the Sewage Collection Fund are applied to the operation and maintenance of the City’s sewer system.
The General Fund is the government’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in other funds.
Measurement Focus, Basis of Accounting, and Financial Statement Presentation (continued)
Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the government considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as in accrual accounting. However, debt service expenditures are recorded only when payment is due.
Property taxes, franchise taxes, licenses, revenues from other agencies and interest associated with the current fiscal year are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal year. All other revenue items are considered to be measurable and available only when cash is received by the government.
The City reports the following major governmental and enterprise funds:
General Fund
41
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
3. Additionally, the City reports the following fund types:
The Private-Purpose Trust Fund accounts for the fiduciary responsibilities that are assigned to the Successor Agency pursuant to the Dissolution Act.
As a general rule the effect of interfund activity has been eliminated from the government- wide financial statements. Exceptions to this general rule are payments-in-lieu of taxes and other charges between the government’s enterprise funds and various other governmental funds. Elimination of these charges would distort the direct costs and program revenues reported for the function concerned.
Amounts reported as program revenues include 1) charges to customers or applicants for goods, services, or privileges provided; 2) fines, forfeitures and penalties; 3) grants and contributions that are restricted to meeting the operational or capital requirement of a particular function; and 4) other miscellaneous revenues that directly benefit a particular function and do not fit into any other category. General revenues include all taxes, investment income, and gain on sale of assets.
Proprietary funds distinguish operating revenues and expenses from non-operating items.
Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations.
The principal operating revenues of the enterprise funds and internal service funds are charges to customers for sales and services. Operating expenses for enterprise funds and internal service funds include the cost of sales and services, administrative expenses, and depreciation of capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses.
When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, then unrestricted resources as they are needed.
Private-Purpose Trust Fund
Measurement Focus, Basis of Accounting, and Financial Statement Presentation (continued)
Nonmajor Enterprise Funds
Other nonmajor enterprise funds consists of the Solid Waste Disposal Fund and the Golf Course Fund. The Solid Waste Disposal Fund accounts for the operation of trash and solid waste collections, and disposal services. The Golf Course Fund was established to account for the operations of the Willowick Golf Course.
Internal Service Funds
The internal service funds account for workers’ compensation, fleet management, employee benefits, information systems, warehouse operations, telephone system, risk management, and communication replacement services provided to City departments on a cost reimbursement basis.
42
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
4. Assets, Liabilities, and Net Position or Fund Balance a.
b.
c.
Utility accounts are billed on a bi-monthly basis. Receivables for water and sewer are recorded when consumption is billed. Unbilled receivables are recorded at fiscal year- end to adjust for the billing cycle and are included as accounts receivable in the Water and Sewer Funds. Sanitary refuse collection accounts are billed quarterly by the refuse hauler and payments are received by the refuse hauler.
Taxes Receivable
Property taxes in California are levied in accordance with Article 13A of the State Constitution at one percent of county-wide assessed valuations. This one percent is allocated pursuant to state law to appropriate units of local government. A voter- approved property tax of eight cents per hundred dollars actual value is levied against all property in the City for the purpose of providing emergency medical services.
Furthermore, the voters approved a one-cent sale tax measure that commits 100% of the revenue to the City.
Deposits and Investments
The City pools idle cash from all funds in order to maximize income from investment activities. Investments are recorded on the City’s books at fair value (quoted market price or best available estimate thereof). Interest income on investments is allocated to individual funds on the basis of monthly cash and investment balances except for the Employee Benefits, Warehouse Operations, and Telephone System Internal Service Funds by management decision.
The City’s cash and cash equivalents are considered to be cash on hand, demand deposits, and short-term investments with original maturities of three months or less from the date of acquisition.
Receivables and Payables
Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either “due to/from other funds” (i.e., the current portion of inter fund loans) or “intercity loan receivable/payable” (i.e., the non-current portion of inter fund loans). All other outstanding balances between funds are reported as “due to/from other funds”. Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as “internal balances”.
Intercity loans receivable, as reported in the fund financial statements, are offset by a non-spendable fund balance in applicable governmental funds to indicate that they are not in spendable form.
The City Council adopted a Pension Funding Policy in 2019. Accordingly, an Internal Revenue Services Section 115 Trust was established to prefund pension obligations.
The trust is a tax-exempt irrevocable trust, trust assets are to be used exclusive for payment of pension liabilities. Assets held in the trust are reported as restricted cash investments in the General Fund.
43
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
4. Assets, Liabilities, and Net Position or Fund Balance (continued) c.
Lien Date: January 1
Levy Date: July 1
Due Date: First Installment - November 1
Second Installment - February 1
Delinquent Date: First Installment - After December 10
Second Installment - After April 10
d.
e.
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government-wide and fund financial statements.
The City uses the purchase method to record prepaid items.
Capital Assets
Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., streets, sidewalks, medians, traffic signals, storm drains) are reported in the applicable governmental or business-type activities columns in the government-wide financial statements and in the proprietary fund and fiduciary fund financial statements.
The government defines capital assets as assets with an initial, individual cost of more than $5,000 and an estimated useful life in excess of two years. Such assets are capitalized at cost. Donated capital assets are recorded at acquisition value at the date of donation.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized.
Taxes Receivable (continued)
The property tax calendar is as follows:
Inventory, Prepaid Items, and Land Held for Resale
Inventory is valued at cost using the first in, first out (FIFO) method. Inventory in the proprietary funds consists of expendable supplies held for future consumption. The cost is recorded as an expense as inventory items are consumed.
Land held for resale is valued at lower of cost or estimated net realizable value, determined upon execution of a disposition and development agreement, at June 30, 2022 and is located in the General Fund, Housing Successor Agency Capital Projects Fund, and the Successor Agency Trust Fund.
In the governmental fund statements, property tax revenue is recognized in the fiscal year for which taxes have been levied, provided that the revenue is collected in the current period or will be collected within 60 days thereafter. 44
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
4. Assets, Liabilities, and Net Position or Fund Balance (continued) e.
Assets Years
Buildings 30
Building improvements 20
Street infrastructure:
Pavement 30
Curbs & gutters 50
Sidewalks 50
Medians 50
Traffic signals 20
Walls 50
Driveways 50
Storm drain infrastructure 50
Water infrastructure:
Fire hydrants 45
Pump stations 10
Reservoirs 65
Water mains 77
Water meters 25
Water pumps & meters 20
Wells 40
Sewer infrastructure 60
Vehicles 3-20
Right-to-use assets varies
Furniture and equipment 10
f.
Capital Assets (continued)
Major outlays for capital assets and improvements are capitalized as projects when constructed. Prior to the implementation of GASB 89, the net interest costs incurred in the financing of projects during the construction period were only capitalized in the enterprise funds. Interest incurred during the construction phase of capital assets of business-type activities is reflected in the capitalized value of the asset constructed, net of interest earned on the invested proceeds of tax-exempt debt over the same period.
Plant, infrastructure, and equipment of the primary government is depreciated using the straight line method over the following estimated useful lives:
Deferred Outflows/Inflows of Resources
In addition to assets, the statement of net position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represent a consumption of net assets that applies to future period(s) and so, will not be recognized as an outflow of resources (expense/expenditure) until then. The City has three types of items that qualify for reporting in this category. Two of the items are the deferred charge from pension- related items and deferred charges related to OPEB. The other item is the unamortized loss on refunding of debt which is reported in the government-wide statement of net position, proprietary funds’ statement of net position and statement of fiduciary net position. A deferred charge on refunding results from the difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunded or refunding debt. 45
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
4. Assets, Liabilities, and Net Position or Fund Balance (continued) f.
g.
h.
i. Fair Value Measurements
Certain assets and liabilities are required to be reported at fair value. The fair value framework provides a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of fair value hierarchy are described as follows:
Level 1 - Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets.
Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly and fair value is determined through the use of models or other valuation methodologies including:
Deferred Outflows/Inflows of Resources (continued)
In addition to liabilities, the statement of net position or balance sheet of governmental funds will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represent an acquisition of net assets that applies to a future period(s) and so, will not be recognized as an inflow of resources (revenue) until that time. The City has five types of items which qualify for reporting in this category. Three of the items are deferred items from pension-related items, deferred charges related to OPEB and deferred items from lease- related items. The fourth item, unamortized gain on refunding of debt, is presented on the government-wide statement of net position and on the proprietary funds’ statement of net position. The fifth item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from notes, accounts, and grant receivables. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available.
Accrued Compensated Absences
The City accounts for compensated absences (unpaid vacation, annual leave, comp time and sick leave) in an internal service (Employee Benefits) fund. A calculated fringe benefit rate, which includes accrued compensated absences, is applied to all labor charges. The resulting funds are deposited into the Employee Benefits internal service fund and are set aside for corresponding liabilities.
Long-Term Obligation
In the government-wide financial statements, proprietary fund and fiduciary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund and fiduciary fund type statements of net position. Bond premiums and discounts, as well as prepaid insurance costs related to bond issuance costs, are deferred and amortized over the life of the bonds. Bonds payable are reported net of the applicable bond premium or discount. Prepaid insurance costs related to bond issuance costs are reported as prepaid insurance costs and amortized over the term of the related debt.
46
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
4. Assets, Liabilities, and Net Position or Fund Balance (continued) i.
•
•
•
j.
1. Government-wide Financial Statements
•
•
•
2. Fund Balances
• Nonspendable Fund Balance – includes amounts that are (a) not in spendable form, or (b) legally or contractually required to be maintained intact. The “not in spendable form” criterion includes items that are not expected to be converted to cash, for example: inventories, prepaid amounts, and long-term notes receivable.
In the government-wide financial statements, net position is classified in the following categories:
Net Investment in Capital Assets – This category groups all capital assets into one component of net position. Accumulated depreciation on these assets and the outstanding principal of related debt reduce this category.
Restricted Net Position – This category consists of restricted assets reduced by liabilities related to those assets.
Unrestricted Net Position – This category represents the net position of the City that are not externally restricted for any project or other purpose.
Restricted resources are used first to fund appropriations.
As prescribed by GASB Statement No. 54, governmental funds report fund balance in classifications based primarily on the extent to which the City is bound to honor constraints on the specific purposes for which amounts in the funds can be spent. As of June 30, 2022, fund balance for governmental funds are made up of the followings:
Classification of Net Position and Fund Balances
Fair Value Measurements (continued)
Quoted prices for similar assets or liabilities in active markets; Quoted prices for identical or similar assets or liabilities in markets that are inactive; inputs other than quoted prices that are observable for the asset or liability;
Inputs that are derived principally from or corroborated by observable market data by correlation or other means.
Level 3 - Inputs to the valuation methodology are unobservable and significant to the fair value measurement. These unobservable inputs reflect the City’s own assumptions about the inputs market participants would use in pricing the asset or liability (including assumptions about risk). These unobservable inputs are developed based on the best information available in the circumstances and may include the City’s own data. 47
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
4. Assets, Liabilities, and Net Position or Fund Balance (continued) j.
2. Fund Balances (continued)
•
•
•
•
k.
l.
Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures.
Accordingly, actual results could differ from those estimates.
Pensions
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Plan and additions to/deductions from the Plan’s fiduciary net position have been determined on the same basis. For this purpose, benefit payments (including refunds of employee contributions) are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value.
Classification of Net Position and Fund Balances (continued) Restricted Fund Balance – includes amounts that can be spent only for the specific purposes stipulated by external resource providers, constitutionally or through enabling legislation. Restrictions may effectively be changed or lifted only with the consent of resource providers.
Committed Fund Balance – includes amounts that can only be used for the specific purposes determined by a formal action of the City’s highest level of decision-making authority, the City Council. Commitments may be changed or lifted only by the City taking the same formal action via an ordinance that imposed the constraint originally.
Assigned Fund Balance – comprises amounts intended to be used by the City for specific purposes that are neither restricted nor committed. Intent is expressed by the City Council to which the City Council has delegated the authority to assign amounts to be used for specific purposes.
Unassigned Fund Balance – is the residual classification for the General Fund and includes all amounts not contained in the other classifications. Unassigned amounts are technically available for any purpose. The General Fund is the only fund that reports a positive unassigned fund balance amount.
In circumstances when an expenditure is made for a purpose for which amounts are available in multiple fund balance classifications, fund balance is depleted in the order of restricted, committed, assigned, and unassigned. 48
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
4. Assets, Liabilities, and Net Position or Fund Balance (continued) l.
Valuation Date June 30, 2020
Measurement Date June 30, 2021
Measurement Period July 1, 2020 - June 30, 2021
m.
Valuation Date June 30, 2020
Measurement Date June 30, 2021
Measurement Period July 1, 2020 - June 30, 2021
n. Leases
For the year ended June 30, 2022, the financial statements include the adoption of GASB Statement No. 87, Leases. The primary objective of this statement is to enhance the relevance and consistency of information about governments' leasing activities.
This statement establishes a single model for lease accounting based on the principle that leases are financings of the right to use an underlying asset. Under this statement, a lessee is required to recognize a lease liability and an intangible right-to- use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources.
Pensions (continued)
GASB 68 requires that the reported results must pertain to liability and asset information within certain defined timeframe. For this report, the following timeframes are used.
Other Post-Employment Benefits (OPEB)
For purposes of measuring the OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense have been determined by an independent actuary. For this purpose, benefit payments are recognized when currently due and payable in accordance with the benefit terms.
Generally accepted accounting principles require that the reported results must pertain to liability and fiduciary net position information within certain defined timeframes. For this report, the following timeframes are used:
49
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
4. Assets, Liabilities, and Net Position or Fund Balance (continued) n.
B. STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
1. Under Article XIIIB of the California Constitution (the GANN Spending Limitation initiative), the City is restricted as to the amount of annual appropriations, and if certain proceeds of taxes exceed allowed appropriations, the excess must be refunded to the taxpayers either through revised tax rates or revised fee schedules.
The City budget report is prepared under the direction of the City Manager in accordance with generally accepted accounting principles (GAAP) and the requirements of Municipal Code Section 2.08.150. Annual budgets are legally adopted for the General Fund, special revenue funds, and capital projects funds. These funds are budgeted based on the modified accrual basis of accounting and include proposed expenditures and the means of financing them. The City Council approves the total budgeted appropriations and any amendments to total appropriations which may be required during the year. Revenues are budgeted by source, and expenditures are budgeted by program.
The legal level of budgetary control is considered to be at the fund level since management can reassign resources within a fund without special approval from City Council. The City Manager is authorized to transfer budgeted amounts between departments within any fund; however, any revisions which alter the total appropriations of any fund must be approved by City Council. During the year ended June 30, 2022, the Street Lighting and Park Maintenance Special Revenue Funds reported expenditure in excess of appropriations of $365,813 and $333, respectively.
Key estimates and judgments include how the City determines the discount rate it uses to discount the expected lease receipts to present value, lease term and lease receipts.
The City used the estimated incremental borrowing rate as the discount rate for leases.
The lease term includes the noncancellable period of the lease. Lease receipts included the measurement of the lease receivable is composed of fixed payments from the lessee.
Leases (continued)
At the commencement of the lease, the City initially measures the lease receivable at the present value of payments expected to be received during the lease term.
Subsequently, the lease receivable is reduced by the principal portion of lease payments received. The deferred inflow of resources are initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date. Subsequently, the deferred inflows of resources are recognized as revenue over the life of the lease term.
The City monitors changes in circumstances that would require a remeasurement of its leases, and will remeasure the lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the amount of the lease receivable.
Budgetary Information
50
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
B. STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (continued)
2. Type of Fund
Housing Authority Enterprise
Successor Redevelopment Agency Fiduciary
The County Auditor-Controller is charged with establishing a Redevelopment Property Tax Trust Fund (RPTTF) for each Successor Agency. The deposit in the RPTTF is used to pay Successor Agency obligations. It is expected that this deficit will be eliminated with future resources obtained from the RPTTF.
The following funds had a deficit at June 30, 2022:
Deficit Fund Balance
The Housing Authority fund, an enterprise fund, has a deficit fund balance of $3,674,916.
The deficit is due to prior period costs related to the revised allocation of the net pension liability in accordance with GASB 68 and due to prior period costs related to the revised allocation of the OPEB liability in accordance with GASB 75. Until Section 8 administrative revenue granted to the Housing Authority from the Department of Housing and Urban Development increases to enable the Housing Authority to pay down its pension and OPEB liability, there will continue to be a deficit in the Housing Authority Fund.
The City of Garden Grove as Successor Agency to the Garden Grove Redevelopment Agency Private Purpose Trust Fund (Successor Agency), a fiduciary fund, has a deficit balance of $15,780,226. The deficit is due to covenant obligations pursuant to developer disposition agreements and Education Revenue Augmentation Fund and Supplemental Education Revenue Augmentation Fund payables to the Housing Successor Agency.
Fund
Deficit Fund
Balance
(3,548,469)$
(15,780,226)$
51
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS
1. Statement of net position
Cash and investments 381,987,194$
Cash and investments with fiscal agent 12,815,416
Cash and investments for pension trust 2,129,403
396,932,013
Successor Agency (Private Purpose Trust Fund)
Cash and investments 19,115,481
Cash and investments with fiscal agent 4,090,176
23,205,657
Total Cash and Investments 420,137,670$
Cash on hand 44,330$
Deposits with financial institutions 10,152,857
Investments 409,940,483
Total Cash and Investments 420,137,670$
Investments Authorized by the City's Investment Policy
The following table identifies the investment types that are authorized by the California Government Code and the City’s investment policy. The table also identifies certain provisions of the City’s investment policy that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustee that are governed by the provisions of debt agreements of the City, rather than the general provision of the Government Code and City’s investment policy.
Cash and Investments
Cash and investments as of June 30, 2022 are classified in the accompanying financial statements as follows:
52
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
1. Maximum Maximum
Maximum Percentage Investment
Maturity Of Portfolio* in One Issuer
Securities of the U.S. Government
or its Agencies 5 years None None
Federal Home Loan Bank (FHLB) 5 years None None
Federal National Mortgage Association
(FNMA) 5 years None None
Federal Farm Credit Bank (FFCB) 5 years None None
Local Agency Investment Fund (LAIF) N/A None None
Certificates of Deposits (CD) N/A 30% 5%
Bankers Acceptances 180 days 30% 10%
Negotiated Certificates of Deposit N/A 30% 5%
Commercial Paper 10 days ** 15% ** 10%
Medium Term Notes 5 years 30% None
Mutual Funds N/A 20% 10%
Mortgage-backed Securities 5 years 20% None
Repurchase Agreement (Overnight) 30 days ** None None
Passbook Savings Account N/A None None
Maximum Percentage Investment in
Maturity of Portfolio One Issuer
U.S. Treasury None None None
Money Market Funds N/A None None
Investment Contracts 30 years None None
Securities of the U.S. Government
or its Agencies 5 years None None
Local Agency Investment Fund (LAIF) N/A None None
Provisions of the debt agreements, rather than the City’s investment policy, govern investment of debt proceeds held by bond trustee. The table below identifies the investment types that are authorized for investments held by bond trustee. The table also identifies certain provisions of these debt agreements that address interest rate risk, credit risk, and concentration of credit risk.
Authorized
Investment Type
Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of shorter term and longer term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time as necessary to provide the cash flow and liquidity needed for operations. The City monitors the interest rate risk inherent in its portfolio by measuring the weighted average maturity of its portfolio. The City has no specific limitations with respect to this metric.
Investments Authorized by the Debt Agreements
Cash and Investments (continued)
Authorized
Investment Type
*Excluding amounts held by bond trustee that are not subject to City's investment policy ** Represents where the City's investment policy is more restrictive than the California Government Code The City investment policy allows for other investments that are, or may become, legal investments through the California Government Code
53
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
1. U.S. Treasury 2.99
U.S. Agency Securities
FHLB 1.84
FFCB 1.60
FNMA 2.84
FN 2.01
FHMTG 3.24
FACMTN 3.85
FHLMG 3.71
Money Market Funds 0.10
Commercial Paper 0.10
Corporate Bonds 2.02
Municipal Bonds 2.27
Supranationals 3.63
Local Agency Investment Fund (LAIF) 0.50
Restricted cash and investments:
Investment Pool (PARS) 0.10
Held by fiscal Agent:
Money Market Funds 0.50
Total
Amount AAA - Aaa AA+ - AA- A - A+ Not Rated
U.S. Treasury 49,575,865$ N/A 49,575,865$ -$ -$ -$ -$ U.S. Agency Securities
FHLB 39,101,665 N/A - - 39,101,665 - - FFCB 53,370,300 N/A - - 53,370,300 - - FNMA 5,113,080 N/A - - 5,113,080 - - FM 2,932,230 N/A - - 2,932,230 - - FHMTG 2,751,870 N/A - - 2,751,870 - - FACMTN 3,843,775 N/A - - 3,843,775 - - FHLMG 6,779,111 N/A - - 6,779,111 - - Money Market Funds 1,867,057 AA - - 1,867,057 - - Commercial Paper 30,254,122 A - - - 30,254,122 - Corporate Bonds 76,734,481 A - 16,023,375 27,233,973 33,477,133 - Municipal Bonds 35,307,732 A - 20,168,349 13,388,310 1,751,073 - Supranationals 12,302,001 A - - 12,302,001 - - Local Agency Investment
Fund (LAIF) 70,972,201 N/A - - - - 70,972,201 Restricted cash and investments:
Investment Pool (PARS) 2,129,403 N/A - - - - 2,129,403 Held by fiscal agent:
Money Market Fund 16,905,590 AAA - 16,905,590 - - - Total 409,940,483$ 49,575,865$ 53,097,314$ 168,683,372$ 65,482,328$ 73,101,604$ 35,307,732
12,302,001
70,972,201
2,129,403
3,843,775
6,779,111
1,867,057
30,254,122
76,734,481
39,101,665
53,370,300
5,113,080
2,932,230
2,751,870
16,905,590
Disclosures Relating to Credit Risk
Minimum
Legal
RatingInvestment Type
Exempt from
Disclosure
Ratings as of Year End
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is 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. The column marked “Exempt From Disclosure” identifies those investment types for which GASB No. 40 does not require disclosure as to credit risk:
$409,940,483
Cash and Investments (continued)
Weighted
Average
Maturity
(in years)Authorized Investment Type Amount
$49,575,865
54
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
1. FHLB U.S. Agency Securities
FFCB U.S. Agency Securities
39,101,665$
53,370,300
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 custodial credit risk for investments is the risk that, in the event of failure of the counterparty (e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment of collateral securities that are in the possession of another party. The California Government Code and the City’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits. The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The fair value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits.
Cash and Investments (continued)
Concentration of Credit Risk
The investment policy of the City contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code.
Investments in any one issuer (other than U.S. Treasury securities, mutual funds, and external investment pools) that represent 5% or more of total City investments are as follows:
Issuer Investment Type Investment Amount
55
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
1. Total
Significant Other
Observable Inputs
(Level 2)
Significant
Unobservable Inputs
(Level 3)
U.S. Treasury 49,575,865$ 49,575,865$ -$ -$ Commercial Paper 30,254,122 - 30,254,122 - Corporate Bonds 76,734,481 - 76,734,481 - Municipal Bonds 35,307,732 - 35,307,732 - Supranationals 12,302,001 - 12,302,001 - U.S. Agency Securities
FHLB 39,101,665 - 39,101,665 - FFCB 53,370,300 - 53,370,300 - FNMA 5,113,080 - 5,113,080 - FM 2,932,230 2,932,230
FHMTG 2,751,870 - 2,751,870 - FHMTG 3,843,775 - 3,843,775 - FHLMG 6,779,111 - 6,779,111 - Total 318,066,232$ 49,575,865 $ 268,490,367 $ - $ Fair Value Measurement and Application
The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are quoted prices for similar assets in active markets; Level 3 inputs are significant unobservable inputs.
Investment
Type
Quoted Process in
Active Markets for
Identical Assets
(Level 1)
Investment in Pension Trust Pool
The City has established a Section 115 Trust to accumulate resources to stabilize the City's pension liability and offset potential volatility in annual contributions to CalPERS. As of June 30, 2022, the City reported $2,129,403 in cash and investments for pension trust. The pension trust assets are managed by with the City's pension trust administrator, Public Agency Retirement Services (PARS). PARS is an external investment pool, is not rated and is not registered with the Securities Exchange Commission. The City selects the investment strategy and the pool is managed by the PARS Board. The fair value of the City's investments in the pool is reported in the accompanying financial statements at amounts based upon the City's pro-rata share of the fair value provided by PARS for the entire PARS portfolio.
The total amount invested by all public agencies in LAIF as of June 30, 2022 was $35.8 billion. LAIF is part of the California Pooled Money Investment Account (PMIA), which at June 30, 2022 had a balance of $234.5 billion.
Cash and Investments (continued)
Investment in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. The fair value of the City’s investment in this pool is reported in the accompanying financial statements at amounts based upon the City’s pro- rata share of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis. 56
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
2. a.
b.
c. Loan from General Fund to the former redevelopment agency:
On May 21, 1984 the City Council approved an agreement between the City and the Agency for Community Development Community Project capital projects fund wherein the Agency agreed to reimburse the City $2,405,511, plus any accruing unpaid interest at the annual rate of 10%, for capital improvements within the Agency’s redevelopment area which were initially paid for by the General Fund. On March 8, 2011, the City Council authorized a loan amortization schedule. Principal payments ranging from $761,037 to $1,114,235 are due annually. In accordance with Assembly Bill X1 26, existing agreements between the City and the former redevelopment agency have been invalidated. Therefore, the City has set up 100% allowance for this loan on February 1, 2012. 3,048,030 Intercity Loans Receivable/Payable at June 30, 2022 consisted of the following:
Loan from General fund to the Water Utility fund:
On July 1, 1998, the City established an intercity loan between the General Fund and Water Utility Fund in the amount of $14,145,092 for the repayment from the Water Utility Fund to the General Fund for street damage repairs throughout the City that have been a benefit to the Water Utility. The loan accrues interest at 4.1% per annum. Beginning July 1, 2018 monthly payments are $100,208 which includes principal and interest to be paid thru June 2033. $ 10,632,394
Loan from General Fund to the former redevelopment agency:
The General fund has loaned to the former redevelopment agency a total of $2,863,113 to assist in funding the Agency’s operating budget since 2004. The loans accrue interest at a rate of 6.5% per annum. On March 8, 2011, City Council authorized a loan amortization schedule. Principal payments ranging from $699,984 to $900,505 are due annually. In accordance with Assembly Bill X1 26, existing agreements between the City and the former
redevelopment agency have been invalidated. Therefore, the City has set up 100% allowance for this loan on February 1, 2012. 2,539,989
57
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
2. d.
e.
f.
g.
Less Allowance
Total Intercity Loans Receivable 39,978,182
(25,308,019)
Total Intercity Loans Receivable, net 14,670,163$
Loan from Vehicle Replacement Fund to the Communications Replacement Fund:
On January 26, 2016 the City Council approved an agreement between the Vehicle Replacement Fund to the Communications Replacement Fund for the upgrade and purchase of communications equipment for the operation of the 800 MHZ public safety communications system. Current schedule reflects the FY15-16 debt service portfolio rate of 1.26% which will be applied to the FY16-17 debt service. The estimated average portfolio rate will be updated annually once the prior year average portfolio rate is available. The principal will be paid annually in the amount of $400,506 plus interest. The principal may be prepaid without penalty at any time. 1,602,024
Loan from Risk Management Fund to the General Fund:
In July 2018, the City Council approved the General Fund to borrow $2,850,550 from the Risk Management Fund to pay for the energy efficiency project. The amount borrowed will cover the cost of the heating, ventilation, and air conditioning systems and lighting retrofit equipment and installation. The General Fund will repay the loan over 19 years at the simple interest rate of 3.6%. 2,435,745
The former redevelopment agency has a loan from the Water Utility Fund in the amount of $750,000. Interest is paid monthly at an annual rate of 10% and has no fixed amortization date. In accordance with Assembly Bill X1 26, existing agreements between the City and the former redevelopment agency have been
invalidated. Therefore, the City has set up 100% allowance for this loan on February 1, 2012. 750,000
Intercity Loans Receivable/Payable at June 30, 2022 (continued) Loan from the General Fund to the former redevelopment
On February 26, 2002 the City Council approved an agreement between the City and the Agency for Community Development Community Project capital projects fund wherein the City has agreed to advance funds to the Agency for the acquisition and development of certain property within the project areas. The advance is subject to repayment on demand and bears interest at a rate of 6.5%. The Agency is responsible for making payments on the City’s $22,735,000 Certificates of Participation Series A of 2002, (the Certificates), the proceeds of which were used to fund the advances from the City to the Agency. The Agency also reimbursed the City for the $683,739 of issuance costs related to the Certificates of Participation. In accordance with Assembly Bill X1 26, existing agreements between the City and the former
redevelopment agency have been invalidated. Therefore, the City has set up 100% allowance for this loan on February 1, 2012. $ 18,970,000
Loan from Water Utility Fund to the former redevelopment agency:
58
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
3. 4.
$ 6,054,260
The former Redevelopment Agency has loans from the Low Income Housing Assets Capital Project Fund, that were used to make the “Supplemental” Educational Revenue Augmentation (SERAF) payments for the fiscal year 2009-10 ($7,906,610) and 2010-11 ($1,626,274).
These loans were due on May 10, 2015 and June 30, 2016, respectively. These loans which were previously invalidated, have been approved as an allowable Recognized Obligation payment by the State of California Department of Finance (DOF).
The amount due from the Successor Agency at June 30, 2022 is $6,054,260, which represents $6,054,260 of SERAF.
Leases Receivable
Due From Successor Agency
For the year ended June 30, 2022, the financial statements include the adoption of GASB Statement No. 87, Leases. The primary objective of this statement is to enhance the relevance and consistency of information about governments leasing activities. This statement establishes a single model for lease accounting based on the principle that leases are financings of the right to use an underlying asset. Under this Statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources.
Governmental Activities
As of July 1, 2021, the City has four leases; a digital billboard and three building leases located throughout Garden Grove. The interest rate for each lease range from 0.185% to 1.612%. The initial lease agreement term ranges from 17 - 281 months. One building lease has an option to extend for an additional 12 months; one building lease has an option to extend for nine 60 month periods; and one building lease has an option to extend for an additional 12 months. The total amount of lease revenue recognized in the current reporting period from leases is $289,038 and the total amount of interest received related to the leases was $17,907. The balance of the lease receivables at June 30, 2022 is $2,587,837. The City has a deferred inflow of resources associated with these leases that will be recognized as revenue over the term of the leases. The balance of deferred inflow of resources at June 30, 2022 is $2,567,704.
59
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
5. a.
General Fund 244,990$ 71,587$
Other Grants and Contributions - 1,132
Nonmajor Governmental Funds - 488,546
Internal Service Funds 330,941 2,177
Water Utility - 8,406
Sewage Collection - 2,721
Housing Authority - 1,275
Nonmajor Enterprise Funds - 87
Total 575,931$ 575,931$
Interfund Receivables, Payables, and Transfers
The composition of interfund receivable/payable balances as of June 30, 2022 is as follows:
Due From
Other Funds
Due To Other
Funds
The interfund payable balances represent routine and temporary cash flow assistance from the General Fund and Workers’ Compensation internal service fund until the amounts receivable are collected to reimburse eligible expenditures.
They also include fringe collected from other funds that are due to the Employee Benefit and Workers' Compensation internal service funds. 60
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
5. b.
General
Fund
Nonmajor
Governmental
Funds
Internal
Service
Funds Total
General Fund -$ 831,837$ -$ 831,837$ Nonmajor Governmental Funds 616,344 - - 616,344 Internal Service Funds 826,958 - - 826,958 Water Utility Fund - - 38,554 38,554 Total 1,443,302$ 831,837$ 38,554$ 2,313,693$
The Water Fund transferred $38,554 to the Fleet Management Internal Service Fund to partially pay for a new vehicle maintained by the Fleet Fund. The rest of the vehicle cost is paid for by the Fleet Management Internal Service Fund.
Transfers from the Employee Benefit Internal Service Fund were made in the amount of $826,958 to the Section 115 Pension Trust Fund to fund future City pension obligations.
Interfund Receivables, Payables, and Transfers (continued) The composition of interfund transfer balances for the year ended June 30, 2022 is as Transfers out:
Transfers from the General Fund were made to subsidize the Garden Grove Cable Fund in the amount of $438,542 and to subsidize the Park Maintenance Assessment District in the amount of $333. In addition, the General Fund made a transfer to the Street Lighting District Fund in the amount of $392,962 to subsidize the operating costs.
Transfers to the General Fund generated by the Garden Grove Tourism Improvement District Special Revenue Fund in the amount of $616,344 were made to fund future City projects.
Transfers in:
follows:
61
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
6. a.
b.
c.
d.
e. Single Family Rehab (Deferred Loan) - Other nonmajor governmental funds:
At June 30, 2022 twelve Deferred Loan Agreements remain, which are reflected in the Housing Successor Agency fund. These loans provide up to $20,000 in down payment assistance in the form of a silent loan that requires no payment for 15 or 30 years. The loans carry 3% or 5% interest charges. There are five Homebuyer Assistance Loans that were issues for $50,000 each. These loans have a term of 45 years and bear a simple interest of 3%. At each anniversary, 1/45th of the principal and interest are forgiven. 351,614
CalHome Mortgage Assistance (CalHome) Loan - Other
Grants and Contributions Major Special Revenue Fund:
At June 30, 2022, twenty-seven CalHome Agreements are
reflected in the Other Grants and Contributions Major Special Revenue Fund. These loans provide up to $60,000 in down payment assistance in the form of a silent loan that requires no payment for 30 years. The loans carry 3% interest charges. 1,389,746 Rental rehabilitation – Other nonmajor governmental funds:
The City has entered into a Housing Rehabilitation Agreement utilizing HOME funds for the purpose of assisting developers in the acquisition, substantial rehabilitation and continued operation of an existing 78-unit multifamily affordable housing project called Sycamore Court. Due to the multiple project funding sources, when completed the project will be subject to new income restrictions, occupancy and other affordable housing covenants.
Disbursement of loan proceeds of $1,200,000 were made in five installment payments commencing on June 2017. The Note bears simple interest at the rate of 3% per annum from the date of initial disbursement. Interest payments of $36,000 are due on an annual basis and no principal payments are required on the loan maturity date of September 30, 2033. 1,330,937 At June 30, 2022, nine MAP agreements are reflected in the Housing Sucessor Agency fund. These loans provide up to $40,000 in down payment assistance in the form of a silent loan that requires no payment for 5 up to 30 years. The loans carry interest between 0 to 3% annually. 134,776
Notes receivable at June 30, 2022, consisted of the following:
Neighborhood Stabilization Program (NSP) Loan – Other
Grants and Contributions Major Special Revenue Fund:
At June 30, 2022, ten NSP Agreements remain, which are reflected in the nonmajor governmental funds. These loans provide up to $40,000 in down payment assistance in the form of a silent loan that requires no payment for 30 years. The loans carry 0% interest charges. $ 391,128
Mortgage Assistance Program (MAP) Loan – Other nonmajor governmental funds:
62
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
6. f.
g.
h.
i.
j. Rental construction – Other nonmajor governmental funds:
The City has entered into a rental construction loan agreement utilizing HOME and Housing Successor Agency funds. The note was for the purpose of assisting the developer with the construction of new low-income housing for City residents. The note bears a simple annual interest rate of 3%. Loan repayment is based on residual receipts and is contingent upon the release of construction covenants for the project. The note commenced upon the initial disbursement of funds HOME in June 2015. An additional $1.6 million was disbursed in June 2017 and is payable to the Housing Successor Agency Fund. Its maturity will be the fifty-fifth anniversary of the date of the Release of Construction Covenants.
4,370,584
Affordable housing agreement – General Fund:
The City has entered into three Affordable Housing Agreements with developers wherein the developers have agreed to comply to certain affordability covenants including the reimbursement to the City of forgone property taxes which would have been payable for the property, increasing at the rate of approximately 2% annually. 2,393,824 The Low and Moderate Income Housing Asset capital projects fund holds six notes related to property rehabilitation loans, which have been used to assist developers in the rehabilitation of multifamily residential buildings located within the City for the purpose of providing adequate low income housing opportunities for City residents. 3,196,288
Rental rehabilitation – Other Grants and Contributions Major Special Revenue Funds and Other nonmajor governmental
funds:
The City has entered into thirteen Housing Rehabilitation Agreements utilizing CDBG funds, which are reflected in the Housing Successor Agency fund and other nonmajor governmental funds. These loans were for the purpose of assisting developers in the rehabilitation and operation of multifamily apartment buildings for the purpose of providing adequate low-income housing to City residents. Many of these buildings had suffered from serious structural deterioration, overcrowding and high crime. 14,581,244
At June 30, 2022, eleven ADDI Agreements utilizing the American Dream Down payment Initiative funds are reflected in nonmajor governmental funds. These loans provide up to $30,000 in down payment assistance in the form of a silent loan that requires no payment for 15 years. The loans carry 0% interest charges. These loans are forgivable if the recipient complies with all conditions. $ 152,863 Notes receivable at June 30, 2022, consisted of the following: (continued) ADDI Down Payment Rehab (ADDI) Loan – Other Grants and
Contributions Major Special Revenue Funds:
Rental rehabilitation - Other nonmajor governmental funds:
63
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
6. k.
l.
m.
980,000
n.
o.
Less Allowance
Total Notes Receivable, net 32,225,690$
Small Business Assistance Program – General fund and
Other Grants and Contributions Major Special Revenue
The City has entered into loan agreements through the Small Business Assistance Program utilizing CDBG funds as well as General Fund monies for a total loan amount of $1,890,000. The notes bear an interest rate equal to 0% or the highest rate permitted by applicable law compounded annually. 976,207 Private Sewer Lateral Loan Agreement – Sewer Fund:
The Garden Grove Sanitary District has entered into a Private Sewer Lateral Loan Agreement with The Helen Brooks Montgomery Revocable Trust on October 1, 2012, for an original amount of $10,000. The loan is due and payable at the simple annual interest rate of 2.24%. Monthly payments in the amount of $65 are required. Loan principal is amortized over the 15-year life and the principal portion of monthly payment reduces the loan payable. 2,488
Stipulation for Summary Judgement:
The City has entered into an agreement with a low income housing provider to pay damages due to breech of contract pursuant to a summary judgement. The agreement stipulates that the housing provider will pay a total sum of $271,697 over 5 years with an annual interest rate of 2%. 160,147
Total Notes Receivable 33,405,152
The City has entered into a financed sale agreement for the sale of twelve single-family residential parcels on March 12, 2016. The initial loan amount is $2,709,030. The note bears a simple annual interest rate of 4% in 60 equal monthly interest-only payments in the amount of $9,030 with a balloon payment on the 60th month.
On December 10, 2019 the City Council approved an amendment to defer interest payments for a period of 30 months. The new interest payment of $9,476 will begin on July, 2020. Principal and interest payment of $19,476 will begin on July 1, 2025. A balloon payment in the amount of $2,453,305 will be due at the end of the loan term or the maturity date of December 1, 2029. 2,993,305 Notes receivable at June 30, 2022, consisted of the following: (continued) Conveyance of Property Loan Agreement – Other nonmajor
governmental funds:
(1,179,462)
Affordable housing agreement – Home Fund:
The City has entered into an Affordable Housing Loan Agreement utilizing HOME funds for the purpose of assisting the developer with the construction of new low-income housing for City residents. The note bears an interest rate of 0% and is to be repaid in full at the end of the 55-year affordability period. Loan repayment is based on residual receipts and is contingent upon the release of construction covenants for the project. The loan amount is $1,400,000 and $980,000 of the loan was disbursed as of June 30, 2022.
64
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
7. 8.
Beginning
Balance Increases Decreases
Ending
Balance
Governmental activities
Capital assets, not being depreciated:
Land 412,953,682$ -$ -$ 412,953,682$ Construction in progress 3,127,854 13,886,901 (9,726,855) 7,287,900 416,081,536 13,886,901 (9,726,855) 420,241,582 Capital assets, being depreciated:
Infrastructure
Street system 416,772,303 6,479,283 - 423,251,586 Storm drain assets 75,851,672 - - 75,851,672 Buildings and park assets 56,137,731 - - 56,137,731 Right-to-use asset* 262,189 - - 262,189 Furniture and equipment 33,782,306 3,247,572 (877,426) 36,152,452 Total capital assets, being depreciated 582,806,201 9,726,855 (877,426) 591,655,630 Less accumulated depreciation for:
Infrastructure
Street system (260,826,108) (7,732,466) - (268,558,574) Storm drain assets (50,758,371) (1,508,179) - (52,266,550) Buildings and park assets (30,991,342) (1,535,839) - (32,527,181) Right to use asset* - (92,736) - (92,736) Furniture and equipment (17,127,643) (2,815,956) 872,959 (19,070,640) Total accumulated depreciation (359,703,464) (13,685,176) 872,959 (372,515,681) Total capital assets, being depreciated, net 223,102,737 (3,958,321) (4,467) 219,139,949 Governmental activities capital assets, net 639,184,273$ 9,928,580 $ (9,731,322)$ 639,381,531$ Business-type activities
Capital assets, not being depreciated:
Land 5,142,500$ -$ -$ 5,142,500$ Construction in progress 1,662,122 12,759,000 (52,948) 14,368,174 6,804,622 12,759,000 (52,948) 19,510,674 Capital assets, being depreciated:
Building and structures 578,910 11,415 - 590,325 Water system 152,747,997 - - 152,747,997 Sewer system 122,698,977 - - 122,698,977 Right-to-use asset* 631,266 - - 631,266 Machinery and equipment 721,060 39,137 (127,729) 632,468 Total capital assets, being depreciated 277,378,210 50,552 (127,729) 277,301,033 Less accumulated depreciation for:
Building and structures (309,949) (11,131) - (321,080) Water system (63,214,306) (3,843,429) - (67,057,735) Sewer system (55,537,712) (1,878,539) - (57,416,251) Right-to-use asset* - (270,449) - (270,449) Machinery and equipment (411,298) (34,642) 9,579 (436,361) Total accumulated depreciation (119,473,265) (6,038,190) 9,579 (125,501,876) Total capital assets, being depreciated, net 157,904,945 (5,987,638) (118,150) 151,799,157 Business-type activities capital assets, net 164,709,567$ 6,771,362 $ (171,098)$ 171,309,831$ * Beginning balance has been restated to reflect the implementation of GASB 87.
Total capital assets, not being depreciated
Total capital assets, not being depreciated
Land Held for Resale
The City and the Successor Agency land held for resale is an inventory of land intended to be sold to developers. The land is carried at the lower of cost or estimated net realizable value, as determined upon execution of a disposition and development agreement.
City land held for resale is comprised of inventory held by the General Fund and the Housing Successor Agency capital projects fund. City and Successor Agency land held for resale balances at June 30, 2022 are $2,819,063 and $25,249,639, respectively.
Capital Assets
Capital asset activity for the year ended June 30, 2022 was as follows:
65
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
8. Governmental Business-type
Activities Activities
Police Protection 488,587$ -$
Traffic safety 775,705 -
Right of way 7,009,961 -
Drainage 1,508,179 -
Community buildings 1,586,134 -
Municipal support 302,984 -
Water - 3,869,144
Sewage collection - 1,890,796
Golf course - 115,522
Housing Authority - 162,728
Internal service fund 2,013,626 -
Total 13,685,176$ 6,038,190$
9. a.
Beginning
Balance* Additions Reductions Ending Balance
Due Within
One Year
Governmental activities
Lease Revenue Bonds, Series 2015A 21,770,000$ -$ (515,000)$ 21,255,000$ 540,000$ Add: Premium 1,286,663 - (54,366) 1,232,297 54,366 Leases payable 262,189 - (94,199) 167,990 86,842 Governmental activities
long-term debt 23,318,852 - (663,565) 22,655,287 681,208 Other non-current liabilities:
Claims payable 42,557,254 11,583,081 (7,662,989) 46,477,346 7,338,593 Compensated absences 8,114,047 7,748,513 (7,947,951) 7,914,609 7,677,171 Governmental activities
long-term liabilities 73,990,153$ 19,331,594$ (16,274,505)$ 77,047,242$ 15,696,972$ Business-type activities
Water Revenue COP 2015 2,870,000$ -$ (955,000)$ 1,915,000$ 985,000$ Water Revenue Bond 2020 23,220,000 - - 23,220,000 420,000 Add: Premium/(Discount) 3,320,296 - (113,192) 3,207,104 113,192 Sewer Revenue Refunding Bond 2017 13,165,000 - (615,000) 12,550,000 645,000 Add: Premium/(Discount) 1,080,803 - (72,456) 1,008,347 72,456 Leases payable 631,266 - (274,517) 356,749 266,129 Other non-current liabilities:
Compensated absences 746,012 981,438 (745,864) 981,586 952,138 Business-type activities
long-term liabilities 45,033,377$ 981,438$ (2,776,029)$ 43,238,786$ 3,453,915$ Private-purpose trust fund
2016 Tax Allocation Bond 34,640,000$ -$ (1,975,000)$ 32,665,000$ 2,055,000$ Add: Premium/(Discount) 4,419,987 - (360,816) 4,059,171 360,815 2014 Tax Allocation Bond 21,150,000 - (2,905,000) 18,245,000 3,015,000 Add: Premium/(Discount) 2,604,876 - (315,743) 2,289,133 315,742 2008 Subordinate Note 1,010,000 - (120,000) 890,000 130,000 Loan Payable to City 7,054,260 - (1,000,000) 6,054,260 - Private-purpose trust fund
long-term liabilities 70,879,123$ -$ (6,676,559)$ 64,202,564$ 5,876,557$ * Beginning balance restated due to the implementation of GASB 87.
Capital Assets (continued)
Depreciation expense was charged to functions/programs of the primary government as follows:
Long-term Debt
Following is a summary of long-term debt transactions for the City for the year ended June 30, 2022:
66
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
9. b.
21,255,000$
Unamortized bond premium 1,232,297
Total lease revenue bonds 22,487,297$
60,821$
107,169
Total leases payable 167,990
Total Governmental Long Term Debt 22,655,287$
The City entered into two building leases on July 2015 and January 2019. As of June 30, 2022, the value of the lease liability is $60,821. The City is required to make monthly fixed payments of $5,033 and $957. The leases have an interest rate of 0.218%.
The buildings' remaining lease term is two years.
The City entered into four vehicle leases between the dates of April 2018 through April 2022. As of June 30, 2022, the value of the lease liability is $107,169. The City is required to make monthly fixed payments ranging from $460 to $631. The leases have interest rates ranging from 0.308% to 2.015%. The
vehicles lease terms range from 18 months to 60 months.
Long-term Debt
Governmental Long-term Debt at June 30, 2022 consisted of the following:
Lease Revenue Bonds, Series 2015 A
On November 10, 2015, the Garden Grove Public Financing Authority issued $24,790,000 of Lease Revenue Bonds, Series 2015A. The Bonds were issued for the current refunding of $17,100,000 of outstanding Certificates of Participation Series A (2002 Financing Project) and to finance the acquisition/construction of a fire station, police building renovations and other public capital improvements. Principal payments on the Bonds are due annually on March 1 each year, ranging from $515,000 to $1,435,000, and continuing until March 1, 2045. Interest is payable semiannually, beginning on March 1, 2016, with an interest rate ranging from
2.00% to 5.00% over the life of the Bonds. Such bonds are subject to Federal arbitrage regulations, however, no arbitrage liability is reported at June 30, 2022.
Leases Payable - Governmental Activities
67
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
9. c.
1,915,000$
Total 2015 refunding revenue bonds 1,915,000$
Operating Revenue 43,256,322$
Non-operating revenues -
Gross revenue 43,256,322
(31,628,164)
Net revenues 11,628,158$
Debt service requirement for next year:
$1,013,450 x 125% 1,266,813$
Less: Expenses (excluding depreciation
amortization, interest and fiscal charges)
Long-term Debt (continued)
Proprietary long-term debt at June 30, 2022 consisted of the following items:
2015 Revenue Certificates of Participation - Water Utility Enterprise Fund
$8,150,000 Refunding Revenue Bonds, Series 2015 were issued on October 1, 2015, for the current refunding of the remaining outstanding balance of the previously issued $16,845,000 of the Refunding Certificate of Participation Series 2004. The refunding was undertaken to achieve debt service savings. Principal payments for 2015 Revenue certificates range from $930,000 to $985,000 and are due annually each December 15 through 2023. Interest is payable semi-annually on June 15 and December 15, at rates ranging from 1.0% to 5.0% over the life of the certificate. Such certificates are subject to Federal arbitrage regulations; however, no arbitrage liability is reported at June 30, 2022. 2015 Revenue Certificates of Participation - Water Utility Enterprise Fund - Debt Service Coverage
The Refunding Revenue Certificates of Participation were issued on October 1, 2015 for the current refunding of the 2004 Water Revenue Bond Refunding. The prior Refunding Revenue Certificates of Participation were issued on April 20, 2004 for prior refunding of the Water Revenue Bonds, Series 1993. These certificates of participation are to be secured and to be serviced from revenues derived by the ownership and operations of the water system including all connection charges and fees collected by the City through the fiscal year 2023. At June 30, 2022 total interest and principal remaining on the certificates is $1,952,750. The Utility covenants that rates and charges for the water service will be sufficient to yield net revenues equal to 125% of the debt service coming due and payable during the next succeeding bond year. Revenue recognized during the year was $43.256 million against debt service payments of $1,013,450. The following analysis shows the test result for compliance with this covenant:
68
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
9. c.
23,220,000$
Unamortized bond premium 3,207,104
Total 2020 revenue bonds 26,427,104$
2020 Revenue Bonds - Water Utility Enterprise Fund - Debt Service Coverage
The Refunding Revenue Bonds were issued on October 22, 2020 for the current refunding of the 2010 Water Revenue Bond Refunding. The prior Refunding Revenue Certificates of
Participation were issued on April 20, 2004 for prior refunding of the Water Revenue Bonds, Series 1993. These bonds are to be secured and to be serviced from revenues derived by the ownership and operations of the water system including all connection charges and fees collected by the City through the fiscal year 2051. At June 30, 2022 total interest and principal remaining on the bonds is $34,735,163. The Utility covenants that rates and charges for the water service will be sufficient to yield net revenues equal to 125% of the debt service coming due and payable during the next succeeding bond year. Revenue recognized during the year was $43.256 million against debt service payments of $1,258,575. The following analysis shows the test result for compliance with this covenant:
Long-term Debt (continued)
Proprietary long-term debt at June 30, 2022 consisted of the following items:
(continued)
2020 Revenue Bonds - Water Utility Enterprise Fund
$23,220,000 Refunding Revenue Bonds, Series 2020 were issued on November 3, 2020, for the advance refunding of the remaining outstanding balance of the previously issued $16,625,000 Water Revenue Bonds, Series 2010. The refunding was undertaken to reduce the City's total debt service payments over the next 10 years by $2.7 million. The net proceeds of $15.6 million will be used to finance the acquisition, expansion, construction, and improvement of certain additional water facilities of the water system of the City. Principal payments for 2020 Revenue Bonds range from $420,000 to $1,160,000 and are due annually each December 15 through fiscal year 2051. Interest is payable semi- annually on June 15 and December 15, at rates ranging from 3.0% to 4.0% over the life of the bonds. The refunding resulted in a net present value saving of $1.63 million, or 15.3% of the refunded bonds. Such certificates are subject to Federal arbitrage regulations; however, no arbitrage liability is reported at June 30, 2022.
69
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
9. c.
Operating Revenue 43,256,322 $
Non-operating revenues -
Gross revenue 43,256,322
(31,628,164)
Net revenues 11,628,158$
Debt service requirement for next year:
$1,258,575 x 125% 1,573,219$
12,550,000$
Unamortized bond premium 1,008,347
Total 2017 revenue refunding bond 13,558,347$
The certificates are secured and to be serviced from the total revenues for the fiscal year excluding any proceeds of taxes or assessments restricted by law and less the operations and maintenance costs excluding depreciation through the fiscal year 2036.
Long-term Debt (continued)
Proprietary long-term debt at June 30, 2022 consisted of the following items:
(continued)
On March 1, 2017, the Garden Grove Sanitary District issued $15,970,000 in bonds to provide funds to refinance the District’s obligations to the 2006 Sewer Revenue Certificate of Participation.
The Certificates were issued to finance the rehabilitation, replacement and improvement of the wastewater collection system of the Garden Grove Sanitation District. The 2017 Bonds are due in annual principal installments of $615,000 to $1,160,000 beginning June 15, 2017 through 2036. Interest rates range from 2.0% to
5.0% and is payable semiannually on June 15 and December 15.
The net proceeds of the bond issue were used to provide for the prepayment of the 2006 Certificates. The reacquisition price was less than the net carrying amount of the old debt by $206,922.
This amount is being reflected as a deferred inflow of resources and amortized over the life of the refunding debt.
2020 Revenue Bonds - Water Utility Enterprise Fund - Debt Service Coverage (continued)
2017 Refunding Sewer Revenue Bond – Sewage Collection
Less: Expenses (excluding depreciation
amortization, interest and fiscal charges)
70 Page 181 of 324
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
9. c.
Operating Revenue 12,025,031 $
Non-operating revenues -
Gross revenue 12,025,031
(5,958,254)
Net revenues 6,066,777$
Debt service requirement for next year:
$1,196,375 x 115% 1,375,831$
143,782$
43,928
169,039
Total leases payable 356,749
Total Proprietary Long Term Debt 42,257,200$
The Utility covenants that rates and charges for the sewer service will be sufficient to yield net revenues equal to 115% of the debt Less: Expenses (excluding depreciation
amortization, interest and fiscal charges)
Leases Payable - Business-Type Activities
Willowick Golf Management, LLC, through authorization from the City, entered into two lease arrangements in the amount of $280,320 for golf carts and golf maintenance equipment in January 2020 and October 2020. As of June 30, 2022, the value of the lease liability is $169,039. The City is required to make monthly fixed payments of $9,304. The leases have an interest rate ranging from 0.146% to
0.198%. The estimated remaining lease term is 24 to 51 months.
Long-term Debt (continued)
Proprietary long-term debt at June 30, 2022 consisted of the following items:
(continued)
2017 Refunding Sewer Revenue Bond – Sewage Collection
Enterprise fund - Debt Service Coverage
The City entered into a building lease in July 2015. As of June 30, 2022, the value of the lease liability is $143,782. The City is required to make monthly fixed payments of $12,942. The lease is calculated using a discount rate of 0.218%. The remaining term of the lease is two years.
The City entered into two vehicle leases in April 2019. As of June 30, 2022, the value of the lease liability is $43,928. The City is required to make monthly fixed payments of $463 per lease. The leases have an interest rate of 0.577%. The remaining lease term of is five years. 71
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
9. d.
32,665,000$
Unamortized bond premium 4,059,171
Total Tax Allocation Bond Issue of 2016 36,724,171$
Tax Allocation Bonds Issue of 2016
$42,000,000 Tax allocation bonds were issued on March 17, 2016.
The SRDA issued the “2016 Bonds” in the aggregate principal amount necessary to provide net proceeds of $42,000,000 to fund the Water Park Hotel pursuant to the first amended and restated disposition and development agreement dated April 13, 2010. The bonds are due in annual principal installments of $1,975,000 to $3,450,000. Interest on the bonds will be payable semiannually each April 1 and October 1, commencing October 1, 2016. The rates ranging from 1.0% to 5.0%. The “2016 Bonds” will be payable on a parity with the debt service on the 2014 Bonds to the extent set forth in the 2016 Bond Indenture. Such certificates are subject to federal arbitrage regulations. No arbitrage liability is reported at June 30, 2022.
Long-term Debt (continued)
Private-purpose trust activity long-term debt at June 30, 2022 consisted of the following items:
72
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
9. d.
18,245,000$
Unamortized bond premium 2,289,133
Total Tax Allocation Bond Issue of 2014 20,534,133$
890,000
On June 1, 2008, the former redevelopment agency for Community Development entered into a note purchase agreement in the amount of $2,015,000, to refund a note issued to Katella Cottages LLC under a Disposition and Development Agreement dated May 11, 2004. The Note has an annual interest rate of 6% with principal payments due annually on October 1 through October 1, 2027. Principal payments range from $120,000 to $170,000. Upon the dissolution of the former redevelopment agency at February 1, 2012, the outstanding balance of the bonds was transferred to the Successor Agency.
Long-term Debt (continued)
Private-purpose trust activity long-term debt at June 30, 2022 consisted of the following items: (continued)
Tax Allocation Refunding Bonds Issue of 2014
$38,810,000 Tax allocation refunding bonds were issued on July 16, 2014. The bonds were issued for the purpose of refunding the Garden Grove Agency for Community Development’s previously issued $57,025,000 community project tax allocation refunding bonds, Series 2003. Proceeds of the Series 2014 bonds will also be used (i) to fund a debt service reserve fund for the 2014 Bonds and (ii) to pay costs incurred in connection with the issuance, sale, and delivery of the 2014 Bonds.
Principal payments ranging from $1,580,000 to $3,330,000 are due annually through the year 2029. Interest is due semi-annually on October 1 and April 1, at rates ranging from 1.0% to 5.0%.
Such bonds are subject to Federal arbitrage regulations; however, no liability is reported at June 30, 2022.
Subordinate Note
73
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
9. d.
6,054,260
Total Private Purpose Trust Funds Long Term Debt 64,202,564$ e.
Principal Interest Total
2023 540,000$ 966,950$ 1,506,950$ 2024 565,000 939,950 1,504,950 2025 595,000 911,700 1,506,700 2026 625,000 881,950 1,506,950 2027 655,000 850,700 1,505,700 2028-2032 3,805,000 3,735,000 7,540,000 2033-2037 4,675,000 2,860,600 7,535,600 2038-2042 5,695,000 1,836,400 7,531,400 2043-2045 4,100,000 416,750 4,516,750 Total 21,255,000$ 13,400,000$ 34,655,000$ Principal Interest Total
2023 86,842$ 747$ 87,589$ 2024 30,848 471 31,319 2025 28,091 200 28,291 2026 22,209 121 22,330 167,990$ 1,539$ 169,529$ Year
Ending
The former redevelopment agency has five loans from the Low Income Housing Assets capital project fund, that were used to make the fiscal year 2005-06 ($621,376) mandated Educational Revenue Augmentation Fund payments and “Supplemental”
Education Revenue Augmentation Fund payments for the fiscal year 2009-10 ($7,906,610) and 2010-11 ($1,626,274). In
accordance with Assembly Bill X1 26, existing agreements between the City and the former redevelopment agency have previously been invalidated. In fiscal year 2017-18, the California Department of Finance changed its previous
determination and has now approved the repayment of the ERAF and SERAF loans ($13,254,260) as an enforceable obligation. At June 30, 2021 the Successor Agency has repaid $6,200,000 of the loan balance. The amount due to the City at June 30, 2022 is $6,054,260, which represents $6,054,260 of SERAF.
Long-term Debt (continued)
Private-purpose trust activity long-term debt at June 30, 2022 consisted of the following items: (continued)
Loan Payable to City
The scheduled annual requirements to amortize all governmental long-term debt outstanding as of June 30, 2022 including interest payments are as follows:
Year
Ending
Leases Payable - Governmental Activities
Lease Revenue Bonds 2015A
74
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
9. f.
Principal Interest Total
2023 985,000$ 28,450$ 1,013,450$ 2024 930,000 9,300 939,300 Total 1,915,000$ 37,750$ 1,952,750$ Principal Interest Total
2023 420,000$ 838,575$ 1,258,575$ 2024 890,000 812,375 1,702,375 2025 920,000 776,175 1,696,175 2026 960,000 738,575 1,698,575 2027 1,000,000 699,375 1,699,375 2028-2032 4,890,000 2,868,275 7,758,275 2033-2037 2,830,000 2,166,900 4,996,900 2038-2042 3,390,000 1,582,625 4,972,625 2043-2047 4,125,000 839,600 4,964,600 2048-2051 3,795,000 192,688 3,987,688 Total 23,220,000$ 11,515,163$ 34,735,163$ Principal Interest Total
2023 645,000$ 551,375$ 1,196,375$ 2024 680,000 519,125 1,199,125 2025 715,000 485,125 1,200,125 2026 750,000 449,375 1,199,375 2027 785,000 411,875 1,196,875 2028-2032 4,570,000 1,428,625 5,998,625 2033-2036 4,405,000 392,175 4,797,175 Total 12,550,000$ 4,237,675$ 16,787,675$ Principal Interest Total
2023 266,129$ 590$ 266,719$ 2024 36,517 229 36,746 2025 36,618 128 36,746 2026 17,485 38 17,523 Total 356,749$ 985$ 357,734$ Year Ending
June 30
Leases Payable - Business Type Activities
Year Ending
June 30
2017 Sewer Refunding Revenue Bonds
Long-term Debt (continued)
The scheduled annual requirements to amortize all proprietary long-term debt outstanding as of June 30, 2022 including interest payments are as follows:
Year Ending
June 30
2015 Refunding Water Revenue Bonds
Year Ending
June 30
2020 Water Revenue Bonds
75
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
9. g.
Principal Interest Total
2023 2,055,000$ 1,445,875$ 3,500,875$
2024 2,160,000 1,340,500 3,500,500
2025 2,265,000 1,229,875 3,494,875
2026 2,380,000 1,113,750 3,493,750
2027 2,500,000 991,750 3,491,750
2028-2032 14,505,000 2,903,875 17,408,875 2033-2034 6,800,000 205,500 7,005,500 Total 32,665,000$ 9,231,125$ 41,896,125$
Principal Interest Total
2023 3,015,000$ 836,875$ 3,851,875$
2024 3,170,000 682,250 3,852,250
2026 3,330,000 519,750 3,849,750
2026 1,955,000 387,625 2,342,625
2027 1,955,000 289,875 2,244,875
2028-2030 4,820,000 362,500 5,182,500 Total 18,245,000$ 3,078,875$ 21,323,875$
Principal Interest Total
2023 130,000$ 49,500$ 179,500$
2024 135,000 41,550 176,550
2025 145,000 33,150 178,150
2026 150,000 24,300 174,300
2027 160,000 15,000 175,000
2028 170,000 5,100 175,100
Total 890,000$ 168,600$ 1,058,600$
Year Ending
June 30
Subordinate Note 2008
Long-term Debt (continued)
The scheduled annual requirements to amortize all the Successor Agency long-term debt outstanding as of June 30, 2022 including interest payments are as follows:
Year Ending
June 30
Tax Allocation Refunding Bonds Issue of 2016
Year Ending
June 30
Tax Allocation Refunding Bonds Issue of 2014
76
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
10. Compensated Absences
The City accounts for compensated absences (unpaid vacation, annual leave, unused holiday, compensated time off, and sick leave) in the Employee Benefit internal service fund and the enterprise funds. The balance for accrued compensated absences at June 30, 2022 is $8,896,195.
Vacation accrues for all employee groups at 10 hours per month after 1 year of service, 12 hours per month after 9 years, 14 hours per month after 14 years, 17.25 hours per month after 19 years, and 20.50 hours per month after 24 years. The maximum an employee may accumulate is an amount equivalent to two full calendar years of service. The maximum management may accumulate is an amount equivalent to two full calendar years of service plus 40 hours.
Sick leave is accumulated on the basis of eight hours for each month of service beginning from the date of hire for all employee groups other than police. Police employees accumulate on the basis of 10 hours for each month of service beginning from the date of hire. The City has adopted a policy for payment of unused sick leave benefits at time of retirement. Employees can be paid 50% for all unused hours up to 1,000, police employees 100% of up to 750 unused hours, and management employees 50% of all unused hours. Studies have indicated that only 14.39% of all accumulated sick leave is actually used by employees, therefore, the sick leave liability is estimated at 14.39% of the total accumulated benefit, or $2,141,307 at June 30, 2022. 77
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
10. Compensated Absences (continued)
Governmental funds:
Beginning
Balance Additions Reductions
Ending
Balance
Due Within
One Year
6,106,271$ 6,563,631 $ (6,690,490)$ 5,979,412$ 5,800,029$ Sick Leave 2,007,776 1,184,882 (1,257,461) 1,935,197 1,877,142 Total 8,114,047$ 7,748,513$ (7,947,951)$ 7,914,609$ 7,677,171$ Enterprise funds:
Beginning
Balance Additions Reductions
Ending
Balance
Due Within
One Year
592,850$ 699,813$ (517,187)$ 775,476$ 752,212$ Sick Leave 153,162 281,625 (228,677) 206,110 199,926 Total 746,012$ 981,438$ (745,864)$ 981,586$ 952,138$ Totals 8,860,059$ 8,729,951$ (8,693,815)$ 8,896,195$ 8,629,309$ A calculated fringe benefit rate, which includes accrued compensated absences, workers’ compensation, retirement and medical benefits, is applied to all labor charges. The resulting funds are deposited into internal service funds and are set aside for corresponding liabilities, which are fully funded by sufficient cash and investment in that fund. Compensated absences are liquidated using the employee benefits internal service fund’s available net position.
Vacation, Annual
Leave, Benefits, and
Comp Time
Vacation, Annual
Leave, Benefits, and
Comp Time
78
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
11. Risk Management
The City utilizes a program to self-insure for workers’ compensation liability for the first $1 million, per occurrence, for injury or occupational illness to city employees pursuant to Workers’ Compensation Laws of the State of California. The City contracts with a third party who administers the program and acts as the representative of the City in claim hearings and litigation. Excess coverage is placed with a joint powers authority for losses from $1 million up to the statutory limit per occurrence. This self-insurance program is accounted for in the Workers’ Compensation internal service fund. There is an estimated liability of $39,565,247 for workers' claims outstanding including claims incurred but not reported on June 30, 2022, which has been included as liabilities in the Workers’ Compensation internal service fund.
The City also has a self-insured program for its tort and civil liabilities. The City is self- insured for the first $2 million per occurrence. Excess liability insurance is carried thereafter to $33 million per occurrence with commercial insurers. Claims administration and adjusting services are provided by contract with a third-party administrator specializing in public entity liability. Representation in matters of litigation is performed through the retaining of outside law firms and is supervised by the city attorney. This self- insurance program is accounted for in the Risk Management internal service fund.
The City estimates a general liability for claims outstanding, including claims incurred but not reported, on June 30, 2022, in the amount of $6,912,099 which has been included as liabilities in the Risk Management internal service fund.
The City is a defendant in various lawsuits. Attempts are made to settle these cases or proceed to trial as recommended by the attorney. The City believes that it has meritorious defenses to the allegations contained in the cases. However, the City has accrued and reserved reasonable amounts based on the actuarial analysis and attorney recommendations to cover the potential losses to the extent the exposures are deemed probable and estimable.
79
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
11. Risk Management (continued)
Worker's Compensation 2022 2021
Liability, July 1 35,816,024$ 34,780,527$
Cost and claims incurred 8,329,712 5,652,543
Claim payments (4,580,489) (4,617,046)
Liability, June 30 39,565,247$ 35,816,024$
Due within one year 4,832,896$ 4,992,810$
Due in more than one year 34,732,351 30,823,214 39,565,247$ 35,816,024$
Risk Management
Liability, July 1 6,741,230$ 6,751,631$
Cost and claims incurred 3,253,369 1,611,696
Claim payments (3,082,500) (1,622,097)
Liability, June 30 6,912,099$ 6,741,230$
Due within one year 2,505,697$ 2,524,431$
Due in more than one year 4,406,402 4,216,799 6,912,099$ 6,741,230$
Settled claims have not exceeded any of the City’s coverage amounts in any of the last three fiscal years and there were no reductions in the City’s insurance coverage during the year ended June 30, 2022. Changes in the aggregate liability for claims for fiscal year ended June 30, 2022 and June 30, 2021 are as follows:
80
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
12. a.
•
•
•
•
Prohibits certain cash payment from being counted as compensation; and Increases retirement age for all new public employees.
Each employee contributes toward his or her retirement based upon the retirement formula. Under PEPRA, the mandated employee contribution rate is one half of the normal cost as determined annually by CalPERS for the City when the actuarial valuation of the plans are performed. Active PEPRA plan members in the Miscellaneous Plan of the City are required to contribute 6.75% of reportable earnings for a 2.0% at 62 retirement plan. Active PEPRA plan members in the Safety Plan of the City are required to contribute 12.75% of reportable earnings for a 2.7% at 57 retirement plan. Active "Classic" plan members in the Miscellaneous Plan of the City are required to contribute 8.00% of reportable earnings for a 2.5% at 55 retirement plan. Active "Classic" plan members in the Safety Plan of the City are required to contribute 9.00% of reportable earnings for a 3.0% at 50 retirement plan.
The required employer contribution rates for fiscal year ended June 30, 2022 under PEPRA are the same as the employer contribution rates for existing miscellaneous employees and public safety employees.
Public Employees' Retirement System
General Information about the Pension Plans
Plan Description - The City of Garden Grove’s defined benefit pension plans, the Miscellaneous Plan of the City of Garden Grove and the Safety Plan of the City of Garden Grove, provide retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. The Miscellaneous Plan of the City of Garden Grove and the Safety Plan of the City of Garden Grove are part of the Public Agency portion of the California Public Employees Retirement System (CalPERS), an agent multiple-employer plan administered by CalPERS, which acts as a common investment and administrative agent for participating public employers within the State of California. A menu of benefit provisions as well as other requirements are established by State statutes within the Public Employees’ Retirement Law. The City selects optional benefit provisions from the benefit menu by contract with CalPERS and adopts those benefits through local ordinance. CalPERS issues a separate Annual Comprehensive Financial Report.
Copies of CalPERS’ annual financial report may be obtained from the CalPERS Executive Office, 400 P Street, Sacramento, CA 95814.
On September 12, 2012, the California Governor signed the California Public Employees’ Pension Reform Act of 2013 (PEPRA) into law. PEPRA took effect January 1, 2013. Key components of the legislation are as follows:
Establishes PEPRA which applies to all public employers and public pension plans on and after January 1, 2013 (except specific exemptions); Establishes new retirement tiers/benefits for new public employees; 81
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
12. a.
Hire date
Prior to
January 1, 2013
On or after
January 1, 2013
Benefit formula 2.5% @ 55 2.0% @ 62
Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50-55 52 - 67
Monthly benefits, as a % of eligible
compensation 2.0% to 2.5% 1.0% to 2.5%
Required employee contribution rates 8.00% 6.75%
Required employer contribution rates 42.03% 42.03%
Hire date
Prior to
January 1, 2013
On or after
January 1, 2013
Benefit formula 3.0% @ 50 2.7% @ 57
Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50 50 - 57
Monthly benefits, as a % of eligible
compensation 3.00% 2.0% to 2.7%
Required employee contribution rates 9.00% 12.75%
Required employer contribution rates 73.98% 73.98%
Misc Safety
Inactive employees or beneficiaries
currently receiving benefits 681 498 Inactive employees entitled to but
not yet receiving benefits 487 168 Active employees 383 173
Total 1,551 839
Employees covered - At June 30, 2020 (actuarial valuation date), the following employees were covered by the benefit terms for each Plan:
Public Employees' Retirement System (continued)
General Information about the Pension Plans (continued) Benefits provided - CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied as specified by the Public Employees’ Retirement Law.
The Plans’ provisions and benefits in effect at June 30, 2022, are summarized as follows:
Miscellaneous
Safety
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CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
12. a.
b. Net Pension Liability
Actuarial Cost Method
Actuarial Assumptions
Discount Rate 7.15%
Inflation 2.50%
Salary Increase Varies by Entry Age and Service
Mortality Rate Table1 Derived using CalPERS' membership data for all funds 1 Post Retirement Benefit
Increase
The lessor of contract COLA up to 2.50% until Purchasing Power Protection Allowance Floor on Purchasing Power applies, 2.50% thereafter
The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. Pre-retirement and Post-retirement mortality rates include 15 years of projected mortality improvement using 90% of Scale MP-2016 published by the Society of Actuaries. For more details on this table, please refer to the CalPERS Experience Study and Review of Actuarial Assumptions report from December 2017 that can be found on the CalPERS website.
Entry Age Normal in accordance with the requirements of GASB 68 Public Employees' Retirement System (continued)
General Information about the Pension Plans (continued) Contributions - Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability.
The employer is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employer contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan member contribution requirements are classified as plan member contributions.
Actuarial Methods and Assumptions Used to Determine Total The June 30, 2020 valuation was rolled forward to determine the June 30, 2021 total pension liability, based on the following actuarial methods and assumptions:
83
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
12. b. Net Pension Liability (continued)
Long-term Expected Rate of Return
1 Current
Target
Real Return
Years 1 -10 2
Real Return
Years 11+ 3
50.00% 4.80% 5.98%
28.00% 1.00% 2.62%
- 0.77% 1.81%
8.00% 6.30% 7.23%
13.00% 3.75% 4.93%
1.00% - (0.92%)
1 In the system's ACFR, Fixed Income is included in Global Debt Securities; Liquidity is included in Short-term Investments; Inflation Assets are included in both Global Equity Securities and Global Debt Securities.
2 An expected inflation of 2.0% used for this period.
3 An expected inflation of 2.92% used for this period.
Discount Rate
The discount rate used to measure the total pension liability was 7.15%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Public Employees' Retirement System (continued)
The expected real rates of return by asset class are as followed:
Public Equity
The long-term expected rate of return on pension plan investments was determined using a building-block method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.
In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectations as well as the expected pension fund cash flows. Using historical returns of all of the funds’ asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11+ years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equal to the single equivalent rate calculated above and adjusted to account for assumed administrative expenses.
Inflation Assets
Private Equity
Real assets
Liquidity
Fixed Income
Asset Class
84
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
12. b. Net Pension Liability (continued)
Subsequent Events
Amortization of Deferred Outflows and Deferred Inflows of Resources Net Difference between 5 year straight-line amortization projected and actual
earnings on investments
All other amounts
The expected average remaining service lifetime (EARSL) is calculated by dividing the total future service years by the total number of plan participants (active, inactive, and retired). Note that inactive employees and retirees have remaining service lifetimes equal to 0. Also note that total future service is based on the members’ probability of decrementing due to an event other than receiving a cash refund.
Public Employees' Retirement System (continued)
The amortization period differs depending on the source of the gain or loss:
Straight-line amortization over the average expected
remaining service lifetime (EARLS) of all members that
are provided with benefits (active, inactive, and retired) as of the beginning of the measurement period
On July 12, 2021, CalPERS reported a preliminary 21.3% net return on investments for fiscal year 2020-21. Based on the thresholds specified in CalPERS Funding Risk Mitigation policy, the excess return of 14.3% prescribes a reduction in investment volatility that corresponds to a reduction in the discount rate used for funding purposes of 0.20%, from 7.00% to 6.80%. Since CalPERS was in the final stages of the four-year Asset Liability Management (ALM) cycle, the board elected to defer any changes to the asset allocation until the ALM process concluded, and the board could make its final decision on the asset allocation in November 2021.
Under GASB 68, gains and losses related to changes in total pension liability and fiduciary net position are recognized in pension expense systematically over time.
The first amortized amounts are recognized in pension expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to pensions and are to be recognized in future pension expense.
On November 17, 2021, the board adopted a new strategic asset allocation. The new asset allocation along with the new capital market assumptions, economic assumptions and administrative expense assumption support a discount rate of
6.90% (net of investment expense but without a reduction for administrative expense) for financial reporting purposes. This includes a reduction in the price inflation assumption from 2.50% to 2.30% as recommended in the November 2021 CalPERS Experience Study and Review of Actuarial Assumptions. This study also recommended modifications to retirement rates, termination rates, mortality rates and rates of salary increases that were adopted by the board. These new assumptions will be reflected in the GASB 68 accounting valuation reports for the June 30, 2022, measurement date.
85
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
12. Public Employees' Retirement System (continued)
c.
The following table shows the balances related to pension at June 30, 2022:
Miscellaneous Safety
Plan Plan Total
Net Pension Liability 65,313,223$ 152,030,717$ 217,343,940$ Deferred Outflows 12,997,911$ 20,249,012$ 33,246,923$ Deferred Inflows 27,555,861$ 40,952,087$ 68,507,948$ Pension Expense 14,523,967$ 4,648,318$ 19,172,285$ The following table shows the changes in the Net Pension Liability for each plan:
Miscellaneous Plan:
Total Pension
Liability
(a)
Plan Fiduciary Net
Position
(b)
Net Pension
Liability/(Asset)
(c) = (a) - (b)
344,006,348$ 241,360,320$ 102,646,028$
Changes in the year:
5,217,353 - 5,217,353 liability 24,233,252 - 24,233,252 1,014,736 - 1,014,736 Contribution - employer - 11,171,129 (11,171,129) Contribution - employee - 2,341,219 (2,341,219) Net Investment income - 54,526,902 (54,526,902) (17,406,313) (17,406,313) -
Administrative expense - (241,104) 241,104 Net changes 13,059,028 50,391,833 (37,332,805) Balance at June 30, 2021 357,065,376$ 291,752,153$ 65,313,223$ refunds of employee
contributions
Balance at June 30, 2020
Changes in Net Pension Liability
Service cost
Interest on the total pension
Difference between actual and
expected experience
Benefit payments, including
Increase (Decrease)
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CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
12. Public Employees' Retirement System (continued)
c.
Safety Plan:
Total Pension
Liability
(a)
Plan Fiduciary
Net Position
(b)
Net Pension
Liability/(Asset)
(c) = (a) - (b)
Balance at June 30, 2020 $ 571,142,786 364,405,653$ 206,737,133$ Changes in the year:
Service cost 6,799,165 - 6,799,165 Interest on the total pension
liability 39,978,657 - 39,978,657 Difference between actual
and expected experience 280,017 - 280,017 Contribution - employer - 17,486,345 (17,486,345) Contribution - employee - 2,746,214 (2,746,214) Net Investment income - 81,895,715 (81,895,715) Benefit payments, including
refunds of employee
contributions (31,360,647) (31,360,647) -
Administrative Expense - (364,019) 364,019 Net changes 15,697,192 70,403,608 (54,706,416) Balance at June 30, 2021 $ 586,839,978 434,809,261$ 152,030,717$ Changes in Net Pension Liability (continued)
Increase (Decrease)
87
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
12. Public Employees' Retirement System (continued)
c.
Miscellaneous Safety
1% Lower 6.15% 6.15%
Net Pension Liability 112,508,406$ 230,894,689 $ Current Discount Rate 7.15% 7.15%
Net Pension Liability 65,313,223$ 152,030,717 $ 1% Higher 8.15% 8.15%
Net Pension Liability 26,359,200$ 87,539,442$ d.
Deferred Outflows of
Resources
Deferred Inflows of
Resources
12,359,003$ - $
measurement date
Differences between expected
and actual experiences 638,908 (463,926) Net difference between projected and
actual earnings on pension plan
investments - (27,091,935) Total 12,997,911$ (27,555,861)$
Miscellaneous Plan
Pension contributions subsequent to
Sensitivity of the Net Pension Liability to Changes in the Discount Rate– The following presents the net pension liability of each Plan, calculated using the discount rate for each Plan, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage-point lower or 1 percentage-point higher than the current rate:
The Net Pension Liabilities for the City’s pension plans have been primarily liquidated by funding from the General, Water, Sewage Collection and Housing Authority funds based on their proportionate personnel costs of the year.
Changes in Net Pension Liability (continued)
Pension expenses and deferred outflows/inflows of resources related to pensions
At June 30, 2022, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
Pension Plan Fiduciary Net Position – Detailed information about each pension plan’s fiduciary net position is available in the separately issued CalPERS financial reports and can be obtained on the CalPERS website.
88
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
12. Public Employees' Retirement System (continued)
d.
Deferred Outflows of
Resources
Deferred Inflows of
Resources
Pension contributions subsequent to
measurement date 19,491,065$ -$
Differences between expected
and actual experiences 757,947 (307,183) Net difference between projected and
actual earnings on pension plan
investments - (40,644,904)
Total 20,249,012$ (40,952,087)$
Miscellaneous Plan Safety Plan
Measurement Periods Ended June 30
Deferred
Outflow/(Inflows)
of Resources
Deferred
Outflow/(Inflows) of
Resources
2022 (6,906,685) $ (9,731,361)$
2023 (6,012,186) (9,453,731)
2024 (6,511,223) (9,752,730)
2025 (7,486,859) (11,256,318)
12. Other Postemployment Benefits
a. Plan Descriptions
The City administers other post-employment benefit (OPEB) plan which is subject to changes based on the discretion of the Council:
PEMHCA: The City provides an agent multiple-employer defined benefit healthcare plan to retirees through the California Public Employee Retirement System (CalPERS) under the California Public Employees Medical and Hospital Care Act (PEMHCA), commonly referred to as PERS Health.
Pension expenses and deferred outflows/inflows of resources related to pensions (continued)
Safety Plan
The $12,359,003 and $19,491,065 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the fiscal year ending June 30, 2023. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:
89
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
13. Other Postemployment Benefits (continued)
b. Employees Covered
Number of
Participants
Inactive Employees Receiving Benefit Payments 287
-
Participating Active Employees 556
Total Number of Participants 843
c. Contributions
d. Actuarial Methods and Assumptions Used to Determine Total OPEB Liability The City’s total OPEB liability was determined by an actuarial valuation dated June 30, 2021, based on the following actuarial methods and assumptions:
ACTUARIAL METHODS AND ASSUMPTIONS:
ACTUARIAL COST METHOD: GASB 74/75 require use of the entry age actuarial cost method.
Entry age is based on the age at hire for eligible employees. The attribution period is determined as the difference between the expected retirement age and the age at hire. The APVPBP (Actuarial Present Value of Projected Benefit Payments) and present value of future service costs are determined on an employee by employee basis and then aggregated.
Employees are eligible for retiree health benefits if they retire from the City on or after age 50 (unless disabled) and are eligible to begin drawing a PERS pension. The benefits are available only to employees who retire from the City.
As of the June 30, 2021 actuarial valuation, the following current and former employees were covered by the City plan:
The contributions for the City’s other post-employment benefits are based on pay-as- you-go financing requirements.
The contribution requirements of plan members and the City are established and may be amended by the City Council. The City must agree to make a defined monthly payment towards the cost of each retiree’s coverage. The City’s contribution rates were $149 and $143 per month for each retiree for the calendar years ended 2022 and 2021, respectively.
For the fiscal year ended June 30, 2022, the City contributed $505,291 to the plan.
Inactive Employees Entitled to But Not Yet Receiving
Benefit Payments
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CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
13. Other Postemployment Benefits (continued)
d.
MORTALITY
Participant Type Mortality Tables
Police
Firefighters
Miscellaneous
Actuarial Methods and Assumptions Used to Determine Total OPEB Liability (continued)
2017 CalPERS Mortality for Active Safety Employees
2017 CalPERS Mortality for Active Safety Employees
2017 CalPERS Mortality for Active Miscellaneous
Employees
To the extent that different benefit formulas apply to different employees of the same class, the service cost is based on the benefit plan applicable to the most recently hired employees (including future hires if a new benefit formula has been agreed to and communicated to employees). This greatly simplifies administration and accounting; as well as resulting in the correct service cost for new hires.
SUBSTANTIVE
PLAN: As required under GASB 74/75 the valuation is based on the substantive plan. The formulation of the substantive plan was based on a review of written plan documents as well as historical information provided by the City regarding practices with respect to employer and employee contribution and other relevant factors.
INFLATION
: 2.50% per year. Actuarial standards require using the same rate for OPEB that is used for pension.
PAYROLL INCREASE: 2.75% per year.
ECONOMIC ASSUMPTIONS:
INVESTMENT RETURN/DISCOUNT RATE: 2.16% per year net of expenses. This is based on the Bond Buyer 20 Bond Index. The interest assumption changed from
2.2% to 2.16%.
TREND: 4% per year. The long-term trend assumption is based on the conclusion that, while medical trend will continue to be cyclical, the average increase over time cannot continue to outstrip general inflation by a wide margin. Trend increases in excess of general inflation result in dramatic increases in unemployment, the number of uninsured and the number of underinsured. These effects are nearing a tipping point which will inevitably result in fundamental changes in health care finance and/or delivery which will bring increases in health care costs more closely in line with general inflation. We do not believe it is reasonable to project historical trend vs. inflation differences several decades into the future.
IMPLICIT RATE SUBSIDY: GASB 74/75 require use of claims costs or age-adjusted premiums approximating claims costs to determine the plan's liability. Adjusting premiums for age creates an Implicit Subsidy and is reflected as part of the plan's liability. In addition, the common approach amongst actuaries in California is to include an implict subsidy as part of the liability and as such the City requested to have reflected age-adjusted premiums in the calculation of the actuarial values.
Implicit Subsidy is considered a benefit and should be included in OPEB valuation and its recognition will increase OPEB liability.
91
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
13. Other Postemployment Benefits (continued)
d.
Future Retirees Post -65
e.
Changes in the Total OPEB Liability (TOL) arising from certain sources are recognized on a deferred basis. Under GASB 74 & 75 OPEB expense includes service cost, interest cost, change in total OPEB liability due to plan changes; all adjusted for deferred inflows and outflows.
General
Retiree liabilities are based on actual retiree premium plus an implicit rate subsidy of
78.3% of non-Medicare medical premium. Liabilities for active participants are based on the first year costs shown below, which include the implicit rate subsidy.
Subsequent years' costs are based on first year costs adjusted for trend and limited by any City contribution caps.
100% at 5 Years of Service
100% at 5 Years of Service
100% at 5 Years of Service
Police
Firefighters
COSTS FOR RETIREE COVERAGE
Police Officers
Miscellaneous
Employees
$1,752
PEMHCA Minimum: $1,752
Implicit Subsidy: $13,982
$1,752
PEMHCA Minimum: $1,752
Implicit Subsidy: $9,375
Actuarial Methods and Assumptions Used to Determine Total OPEB Liability (continued)
RETIREMENT RATES
Employee Type
Police Officers 2017 CalPERS 3%@50 Rates for Sworn Police Employees or PEPRA rates, as appropriate
Retirement Rate Tables
2017 CalPERS 3%@50 Rates for Sworn Fire Employees or
PEPRA rates, as appropriate
2017 CalPERS 2.5%@55 Rates for Miscellaneous Employees
or PERPRA rates, as appropriate
Service Requirement Tables
General Employees
Firefighters
SERVICE REQUIREMENT
Employee Type
Recognition of Deferred Outflows and Inflows of Resources $1,752
The participation rates per the actuarial report for all employee types for the group that is less than age 65 (Non-Medicare) and for the group that is more than age 65 (Medicare) is 70 percent.
Participant Type
Fire Fighters
PEMHCA Minimum: $1,752
Implicit Subsidy: $13,982
Future Retirees Pre-65
92
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
13. Other Postemployment Benefits (continued)
e.
•
•
•
•
Deferred Outflows of
Resources
Deferred Inflows
of Resources
$ 505,291 $ -
28,869,893 (564,150)
Difference between expected and actual
experience - (10,735,767) Total $ 29,375,184 $ (11,299,917)
Measurement
Periods Ended
June 30
Deferred
Outflows/(Inflows) of
Resources
2022 $ 2,451,536
2023 2,451,536
2024 2,451,536
2025 2,451,536
2026 2,451,536
Thereafter 5,312,296
Investment gains and losses can be deferred five years.
Experience gains and losses can be deferred over the expected average remaining service lives (EARSL) of plan participants. In calculating the EARSL, terminated employees (primarily retirees) are considered to have working lifetime of zero. This often make the EARSL, quite short.
Recognition of Deferred Outflows and Inflows of Resources (continued) The TOL can arise in several ways - e.g., as a result of plan changes or changes in actuarial assumptions. TOL can also arise from actuarial gains and losses. Actuarial gains and losses result from differences between actuarial assumptions and the actual plan experience.
Under GASB 74 and 75, a portion of actuarial gain and losses can be deferred as follows:
Liability changes resulting from changes in economic and demographic assumptions are also deferred based on the average working lifetime.
The $505,291 reported as deferred outflows of resources related to contributions subsequent to the June 30, 2021 measurement date will be recognized as a reduction of the total OPEB liability during the fiscal year ending June 30, 2023. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as OPEB expense as follows:
OPEB Expense a Deferred Outflow/Inflow of Resources to OPEB Liability changes resulting from plan changes, for example, cannot be deferred.
For the fiscal year ended June 30, 2022, the City recognized OPEB expenses of $6,234,992. As of fiscal year ended June 30, 2022, the City reported deferred outflows of resources related to OPEB from the following sources:
OPEB contributions subsequent to measurement
Changes of assumptions
93
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
13. Other Postemployment Benefits (continued)
f.
g.
Increase (Decrease)
Total OPEB
Liability (TOL)
55,245,075$
Changes recognized for the measurement period:
Service Cost 2,563,528
Interest on TOL 1,219,928
Employer Contributions as Benefits (2,112,394)
Experience (Gains)/Losses (11,665,240)
Assumption Changes 3,457,450
Net Changes (6,536,728)
Balance at June 30, 2021 48,708,347$
h.
Discount Rate
1% Lower Valuation Discount
Rate
Discount Rate
1% Higher
OPEB Liability $55,869,420 $48,708,347 $42,870,148
The following presents the OPEB liability with a discount rate that is one percentage point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2021:
Balance at June 30, 2020
Total OPEB Liability
If actuarial assumptions are borne out by experience, the City will fully accrue retiree benefits by expensing an amount each year that equals the service cost. If no accruals had taken place in the past, there would be a shortfall of many years’ accruals, accumulated interest and forfeitures for terminated or deceased employees. This shortfall is called the Total OPEB Liability (TOL). The TOL is calculated as the APVPBP (Acturial Present Value of Projected Benefit Payments) minus the present value of future service costs.
Changes in the OPEB Liability
The changes in the OPEB liability for the City are as follows:
Sensitivity of OPEB Liability to Changes in the Discount Rate Changes in Total OPEB Liability as of June 30, 2021
94
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
13. Other Postemployment Benefits (continued)
i.
Trend Rate 1%
Lower Valuation Trend
Trend Rate 1%
Higher
OPEB Liability $41,528,968 $48,708,347 $57,906,192
14. Commitments and Contingencies
a. Grants
b. Construction Commitments
Remaining
Spent-to-date Commitment
Street Improvements 836,762$ 1,041,407$
Storm Drain Improvements 3,578,869 2,270,777
Park Improvements 1,085,041 213,237
Building Improvements 644,338 1,050,347
Water Improvements 8,845,483 5,110,556
Sewer Improvements 5,502,366 580,068
Total 20,492,859$ 10,266,392$
Sensitivity of OPEB Liability to Changes in the Trend Rate The following presents the OPEB liability of the City if it were calculated using healthcare cost trend rates that are one percentage point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2021:
Under the terms of federal, county and state grants, periodic audits are required and certain costs may be questioned as not appropriate expenditures under the terms of the grants. Such audits could lead to reimbursements to the grantor agencies. If some expenditures were disallowed, the City believes such disallowances, if any, would be immaterial.
The City has active construction projects as of June 30, 2022. City project commitments includes street improvements, storm drain improvements, building improvements, and park improvements. Proprietary fund project commitments include water main improvements, water reservoir rehabilitation projects and sewer main improvements. At fiscal year-end, the City’s construction project commitments with contractors are as follows:
95
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
14. Commitments and Contingencies (continued)
c. Contract Commitments
15. Joint Venture
16. Tax Abatements
In 2010, the Successor Agency entered into an agreement with Garden Grove MXD, LLC for the construction of the Great Wolf Lodge. The performance based assistance began in 2015-16 and is based on the Transient Occupancy Tax rate. If the Transient Occupancy Tax rate charged by the City impacts an agreed upon Transient Occupancy Tax rate differential with a neighboring City, an amount will be rebated to the developer equal to the total room revenue multiplied by that Transient Occupancy Tax differential. The amount of Transient Occupancy Tax rebated to Garden Grove MXD, LLC for the Fiscal Year 2021-22 is $373,458. This amount is an approved enforceable obligation of the Successor Agency, and will be paid via the State of California approved Recognized Obligation Payments Schedule.
The City entered into an agreement with the Orange County Fire Authority (OCFA) on April 9, 2019 for OCFA to provide fire and emergency medical services to the City starting on August 16, 2019. OCFA will lease specified apparatus at no cost and fire stations at $1 per year per station. Annually, the City will pay its share of OCFA’s vehicle replacement program. The City will also pay a monthly fee of $1,931,500 for the fire and emergency medical services. The monthly amount is subject to change on an annual basis and is due at the beginning of each month.
The City participates in the Anaheim-Garden Grove-Orange Fire Training Facility Authority, a joint powers authority created to finance fire training and dispatching facilities. The City Council of each city appoints one representative to the three-member Board of Directors.
The City’s proportionate share is 22.0%. Because the City is not financially accountable, the training facility is not considered part of the City’s reporting entity. Separate financial statements are not issued.
The City of Garden Grove enters into various tax abatement agreements for the purpose of attracting and retaining businesses within the City. The Garden Grove Agency for Community Development also entered into three such agreements specific to hotel developments that are now the enforceable obligations of the Successor Agency pursuant to the 2011 Redevelopment Agency Dissolution Act.
In 2016, the City approved an Amended and Restated Operating Covenant Agreement with California Fuels and Lubricants for business retention purposes pursuant to Senate Bill 562. The Amended Agreement effective July 1, 2016 provides for economic development assistance in form of varying revenue sharing ratios of the amount of sales tax revenue generated in excess of $200,000 annually for a period of 20 years. For Fiscal Year 2021-22, California Fuels and Lubricants received assistance payments of $1,064,255.
96
CITY OF GARDEN GROVE
NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
FISCAL YEAR ENDED JUNE 30, 2022
C. DETAILED NOTES ON ALL FUNDS (continued)
16. Tax Abatements (continued)
17. Prior Period Adjustment
Governmental Business-Type
Activities Golf Fund Total
Net position, beginning
of year 598,364,553$ 3,668,083$ 602,032,636$
Right-to-use assets 229,281 513,117 742,398 Leases payable (229,281) (522,652) (751,933) Net position, beginning
of year, as restated 598,364,553$ 3,658,548$ 602,023,101$ With the implementation of GASB 87 - Leases, the beginning balance of capital assets and long-term liabilities were restated as follows:
In 2017, the City entered into an agreement with Garden Grove Automotive, Inc (GGA) to acquire the site and continue to sell Kia automobiles. Subject to the contingency that GGA fulfills the covenants of the agreement and generate enough sales tax revenue during the fiscal year, the City has agreed to pay an amount equal to 35% of the sales tax revenue in excess of $150,000. The amount paid at June 30, 2022 was $21,500.
97
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Required Supplemental
Information
Required
Supplemental
Information
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Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Taxes 115,783,000$ 138,877,000$ 147,355,942$ 8,478,942$ Licenses and permits 3,225,000 3,925,000 2,704,550 (1,220,450) Fines, forfeits and penalties 2,300,000 1,500,000 1,859,264 359,264 Investment earnings 1,152,684 1,152,684 (4,217,678) (5,370,362) Charges for current services 5,877,401 5,977,401 7,670,580 1,693,179 From other agencies 27,000,000 27,000,000 24,654,556 (2,345,444) Other revenues - - 3,367,097 3,367,097 Total revenues 155,338,085 178,432,085 183,394,311 4,962,226 EXPENDITURES:
Current:
Fire 30,158,332 30,158,332 26,975,339 3,182,993 Police 70,385,534 70,542,611 68,181,105 2,361,506 Traffic safety 2,709,761 2,709,761 2,708,284 1,477 Public right of way 25,663,584 26,163,189 6,781,007 19,382,182 Community buildings 21,748,677 4,248,677 3,713,197 535,480 Community services 5,025,860 5,233,153 4,805,877 427,276 Economic development 1,003,112 1,793,338 1,778,841 14,497 Parks and greenbelts 1,623,917 1,623,917 1,601,155 22,762 Community planning and development 7,692,738 26,527,959 7,136,889 19,391,070 Municipal support 9,282,729 9,304,248 8,856,198 448,050 Debt service:
Principal retirement 515,000 515,000 541,101 (26,101) Interest 1,092,317 1,092,317 1,093,121 (804) Total expenditures 176,901,561 179,912,502 134,172,114 45,740,388 Excess (deficiency) of revenues
over (under) expenditures (21,563,476) (1,480,417) 49,222,197 50,702,614 OTHER FINANCING SOURCES (USES):
Transfers in 1,386,746 1,386,746 1,443,302 56,556 Transfers out (1,542,282) (1,542,282) (831,837) 710,445 Total other financing sources (uses) (155,536) (155,536) 611,465 767,001 Net change in fund balance (21,719,012) (1,635,953) 49,833,662 51,469,615 Fund balance, beginning of year 112,431,637 112,431,637 112,431,637 - Fund balance, end of year 90,712,625$ 110,795,684$ 162,265,299$ 51,469,615$
See accompanying note to required supplementary information.
CITY OF GARDEN GROVE
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
98
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Fines, forfeits and penalties 700,000$ 700,000$ 686,745$ (13,255)$ Investment earnings (loss) - - 149,151 149,151 From other agencies 3,738,792 3,900,941 7,419,644 3,518,703 Other revenues - - - - Total revenues 4,438,792 4,600,941 8,255,540 3,654,599 EXPENDITURES:
Current:
Police 475,644 1,243,820 1,001,878 241,942 Traffic safety 454,962 454,962 433,194 21,768 Public right of way 1,829,367 4,808,221 2,361,940 2,446,281 Community services 533,275 550,070 496,624 53,446 Community planning and development 836,548 7,401,260 2,947,235 4,454,025 Debt service:
Principal retirement - - 8,837 (8,837) Interest - - 22 (22) Total expenditures 4,129,796 14,458,333 7,249,730 7,208,603 Net change in fund balance 308,996 (9,857,392) 1,005,810 10,863,202 Fund balance, beginning of year 5,970,300 5,970,300 5,970,300 - Fund balance (deficit), end of year 6,279,296$ (3,887,092)$ 6,976,110$ 10,863,202$ See accompanying note to required supplementary information.
CITY OF GARDEN GROVE
OTHER GRANTS AND CONTRIBUTIONS SPECIAL REVENUE FUNDS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
99
Measurement Period 2021 2020 2019
TOTAL PENSION LIABILITY
Service cost 5,217,353 $ 5,053,242 $ 5,475,558 $ Interest on total pension liability 24,233,252 23,364,470 22,545,983 Changes of benefit terms - 2,033,512 - Changes of assumptions - - - Difference between expected and actual experience 1,014,736 (1,623,742) 3,673,870 Benefit payments, including refunds of employee contributions (17,406,313) (17,321,101) (16,224,456) Net change in total pension liability 13,059,028 11,506,381 15,470,955 Total pension liability - beginning 344,006,348 332,499,967 317,029,012 Total pension liability - ending (a) 357,065,376$ 344,006,348$ 332,499,967$
PLAN FIDUCIARY NET POSITION
Contribution - Employer 11,171,129$ 10,190,871$ 9,162,242$ Contribution - Employee 2,341,219 2,282,163 2,158,717 Net investment income 54,526,902 11,708,962 14,721,760 Benefit payments, including refunds of employee contributions (17,406,313) (17,321,101) (16,224,456) Net Plan to Plan Resource Movement - - (10,044) Administrative Expense (241,104) (331,053) (160,695) Other Miscellaneous Income/(Expense) 1 - - 522 Net change in fiduciary net position 50,391,833 6,529,842 9,648,046 Plan fiduciary net position - beginning 2 241,360,320 234,830,478 225,182,432 Plan fiduciary net position - ending (b) 291,752,153$ 241,360,320 $ 234,830,478 $ Plan net pension liability - ending (a) - (b) 65,313,223$ 102,646,028$ 97,669,489$ Plan fiduciary net position as a percentage of the total pension liability 81.71% 70.16% 70.63% Covered payroll 3 29,694,668$ 28,436,925$ 30,347,270$ Plan net pension liability as a percentage of covered payroll 219.95% 360.96% 321.84% *Historical information is required only for measurement periods for which GASB 68 is applicable 1 2
3 Includes any beginning of year adjustment.
During Fiscal Year 2017-18, as a result of Governmental Accounting Standards Board Statement (GASB) No. 75, Accounting and Financial Reporting for Postemployment Benefit Plans other than Pensions (GASB 75), CalPERS reported its proportionate share of activity related to postemployment benefits for participation in the State of California's agent OPEB plan. Accordingly, CalPERS recorded a one-time expense as a result of the adoption of GASB
75. Additionally, CalPERS employees participate in various State of California agent pension plans and during Fiscal Year 2017-18, CalPERS recorded a correction to previously reported financial statements to properly reflect its proportionate share of activity related to pensions in accordance with GASB Statement No. 68, Accounting and Financial Reporting for Pensions (GASB68).
AGENT MULTIPLE EMPLOYER DEFINED BENEFIT PENSION PLANS
THE LAST TEN FISCAL YEARS*
Miscellaneous
CITY OF GARDEN GROVE
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS Includes one year's payroll growth using 2.75 percent payroll growth assumption for fiscal years ended June 30, 2018-21, 3.00 percent payroll growth assumption for fiscal years ended June 30, 2014-17.Benefit Changes: The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date. However, offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes) that occurred after the valuation date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary.
Changes of Assumptions: None in 2019 - 2021. In 2018, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study and Review of Assumptions December 2017. There were no changes in the discount rate. In 2017, the discount rate was reduced from 7.65 percent to 7.15 percent. In 2016, there were no changes. In 2015, amounts reported reflect an adjustment of the discount rate from 7.5 percent (net of administrative expense) to 7.65 percent (without a reduction for pension plan administrative expense). In 2014, amounts reported were based on the 7.5 percent discount rate.
Notes to Schedule of Changes in Net Pension Liability and Related Ratios:
100
2018 2017 2016 2015 2014
5,401,390$ 5,295,064 $ 4,717,431 $ 4,505,053 $ 4,722,338$ 21,444,843 20,965,466 20,513,676 19,499,703 18,697,528 - - - - - (1,737,101) 17,855,824 - (4,893,202) - (4,057,535) (5,244,453) 1,501,168 (1,007,886) - (14,088,814) (13,540,154) (12,581,087) (12,134,038) (11,490,804) 6,962,783 25,331,747 14,151,188 5,969,630 11,929,062 310,066,229 284,734,482 270,583,294 264,613,664 252,684,602 317,029,012$ 310,066,229$ 284,734,482$ 270,583,294$ 264,613,664$ 8,199,628$ 7,579,342$ 6,646,792$ 5,948,472$ 5,101,581$ 2,429,785 2,308,262 2,242,990 2,281,790 2,070,127 17,695,861 21,554,042 1,004,774 4,419,750 29,571,239 (14,088,814) (13,540,154) (12,581,087) (12,134,038) (11,490,804) 36,458 (64,848) (69,973) - - (330,147) (286,986) (120,179) (221,880) - (626,954) - - - - 13,315,817 17,549,658 (2,876,683) 294,094 25,252,143 211,866,615 194,316,867 197,193,550 196,899,456 171,647,313 225,182,432$ 211,866,525$ 194,316,867$ 197,193,550$ 196,899,456$ 91,846,580$ 98,199,704$ 90,417,615$ 73,389,744$ 67,714,208$
71.03% 68.33% 68.24% 72.88% 74.41%
29,746,612$ 29,037,915$ 28,573,176$ 27,094,801$ 27,060,561$ 308.76% 338.18% 316.44% 270.86% 250.23%
Miscellaneous
101
Measurement Period 2021 2020 2019
TOTAL PENSION LIABILITY
Service cost 6,799,165$ 8,470,387$ 9,117,082$ Interest on total pension liability 39,978,657 38,866,660 37,632,892 Changes of benefit terms - 1,572,470 - Changes of assumptions - - - Difference between expected and actual experience 280,017 (691,163) 4,129,559 Benefit payments, including refunds of employee contributions (31,360,647) (31,097,422) (29,007,470) Net change in total pension liability 15,697,192 17,120,932 21,872,063 Total pension liability - beginning 571,142,786 554,021,854 532,149,791 Total pension liability - ending (a) 586,839,978$ 571,142,786$ 554,021,854$
Contribution - Employer 17,486,345$ 15,875,859$ 15,698,349$ Contribution - Employee 2,746,214 2,639,127 2,644,271 Net investment income 81,895,715 17,702,544 22,658,615 Benefit payments, including refunds of employee contributions (31,360,647) (31,097,422) (29,007,470) Net Plan to Plan Resource Movement - - 10,044 Administrative Expense (364,019) (507,220) (248,366) Other Miscellaneous Income/(Expense) 1 - - 808 Net change in fiduciary net position 70,403,608 4,612,888 11,756,251 Plan fiduciary net position - beginning 2 364,405,653 359,792,765 348,036,514 Plan fiduciary net position - ending (b) 434,809,261$ 364,405,653 $ 359,792,765$ Plan net pension liability - ending (a) - (b) 152,030,717$ 206,737,133$ 194,229,089$ Plan fiduciary net position as a percentage of the total pension liability 74.09% 63.80% 64.94% Covered payroll 3 27,646,663$ 27,964,303 $ 29,663,516 $ Plan net pension liability as a percentage of covered payroll 549.91% 739.29% 654.77% *Historical information is required only for measurement periods for which GASB 68 is applicable 1 2
3 Benefit Changes: The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date. However, offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes) that occurred after the valuation date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary.
Changes of Assumptions: None in 2019 - 2021. In 2018, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study and Review of Assumptions December 2017. There were no changes in the discount rate. In 2017, the discount rate was reduced from 7.65 percent to 7.15 percent. In 2016, there were no changes. In 2015, amounts reported reflect an adjustment of the discount rate from 7.5 percent (net of administrative expense) to 7.65 percent (without a reduction for pension plan administrative expense). In 2014, amounts reported were based on the 7.5 percent discount rate.
Safety
Includes any beginning of year adjustment.
Notes to Schedule of Changes in Net Pension Liability and Related Ratios:
During Fiscal Year 2017-18, as a result of Governmental Accounting Standards Board Statement (GASB) No. 75, Accounting and Financial Reporting for Postemployment Benefit Plans other than Pensions (GASB 75), CalPERS reported its proportionate share of activity related to postemployment benefits for participation in the State of California's agent OPEB plan. Accordingly, CalPERS recorded a one-time expense as a result of the adoption of GASB 75.
Includes one year's payroll growth using 2.75 percent payroll growth assumption for fiscal years ended June 30, 2018-21, 3.00 percent payroll growth assumption for fiscal years ended June 30, 2014-17.
Additionally, CalPERS employees participate in various State of California agent pension plans and during Fiscal Year 2017-18, CalPERS recorded a correction to previously reported financial statements to properly reflect its proportionate share of activity related to pensions in accordance with GASB Statement No. 68, Accounting and Financial Reporting for Pensions (GASB68).
CITY OF GARDEN GROVE
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS
AGENT MULTIPLE EMPLOYER DEFINED BENEFIT PENSION PLANS
THE LAST TEN FISCAL YEARS*
102
2018 2017 2016 2015 2014
8,706,648$ 8,648,153 $ 7,378,575 $ 7,025,519 $ 7,433,857 $ 36,094,312 35,007,255 33,944,797 32,447,673 31,439,433 - - - - - (2,221,006) 29,556,856 - (4,660,010) - (961,074) (2,081,126) 2,203,036 (8,032,852) - (26,226,816) (24,371,140) (22,718,361) (21,846,674) (20,185,546) 15,392,064 46,759,998 20,808,047 4,933,656 18,687,744 516,757,727 469,997,729 449,189,682 444,256,026 425,568,282 532,149,791$ 516,757,727$ 469,997,729$ 449,189,682$ 444,256,026$ 14,147,727$ 13,302,274$ 11,468,654$ 10,155,643$ 9,427,732$ 2,873,704 2,823,680 2,915,098 2,611,738 2,439,710 27,492,574 33,837,324 1,532,436 6,960,883 47,553,580 (26,226,816) (24,371,140) (22,718,361) (21,846,674) (20,185,546) (37,788) - - - - (516,231) (452,000) (190,840) (352,473) - (980,332) - - - - 16,752,838 25,140,138 (6,993,013) (2,470,883) 39,235,476 331,283,676 306,143,539 313,136,552 315,607,435 276,371,959 348,036,514$ 331,283,677$ 306,143,539$ 313,136,552$ 315,607,435$ 184,113,277$ 185,474,050$ 163,854,190$ 136,053,130$ 128,648,591$
65.40% 64.11% 65.14% 69.71% 71.04%
28,541,707$ 28,636,267$ 27,481,750$ 26,325,623$ 26,592,225$ 645.07% 647.69% 596.23% 516.81% 483.78%
Safety
103
Schedule of Plan Contributions for the Fiscal Years Ended June 30 2022 2021 2020 2019
Actuarially determined contributions $ 12,359,003 $ 11,167,273 $ 10,190,871 $ 9,153,245 Contributions in relation to the
actuarially determined contributions (12,359,003) (11,167,273) (10,190,871) (9,153,245) Contribution deficiency (excess) $ - $ - $ - $ - Covered payroll $ 30,863,494 $ 29,694,668 $ 28,436,925 $ 30,347,270 Contributions as a percentage of
covered payroll 40.04% 37.61% 35.84% 30.16%
* Historical information is required only for measurement periods for which GASB 68 is applicable Notes to Schedule of Plan Contributions:
Valuation date:
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry age normal
Amortization method/period For details, see June 30, 2019 Funding Valuation Report.
Asset valuation method Fair value of assets. For details, see June 30, 2019 Funding Valuation Report.
Inflation
Salary Increases
Payroll growth
Investment rate of return
Retirement age
Mortality
Other information
CITY OF GARDEN GROVE
For changes to previous year's information, refer to past GASB 68 reports. 6/30/2019
2.50%
Varies by entry age and service
2.75%
Miscellaneous
The probabilities of retirement are based on the 2017 CalPERS Experience Study which are incorporated in the current valuation. The pre-retirement mortality non-industrial death rates vary by age and gender. Industrial death rates vary by age. The non-industrial death rates are used for all plans. The industrial death rates are used for safety plans. Miscellaneous plans usually have industrial death rates set to zero unless the agency has specifically contracted for industrial death benefits. The post-retirement mortality rates include 15 years of projected on-going mortality improvement using 90 percent of Scale MP 2016 published by the Society of Actuaries.
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS
AGENT MULTIPLE EMPLOYER DEFINED BENEFIT PENSION PLANS
THE LAST TEN FISCAL YEARS*
The probabilities of retirement are based on the 2017 CalPERS Experience Study which are incorporated in the current valuation.
7.00%, net of pension plan investment administrative expenses; includes inflation.
104
2018 2017 2016 2015 2014
$ 8,199,628 $ 7,579,342 $ 6,646,792 $ 5,948,472 $ 5,101,581 (8,199,628) (7,579,342) (6,646,792) (5,948,472) (5,101,581) $ - $ - $ - $ - $ - $ 29,746,612 $ 29,037,915 $ 28,573,176 $ 27,094,801 $ 27,060,561
27.56% 26.10% 23.26% 21.95% 18.85%
Miscellaneous
105
Schedule of Plan Contributions for the Fiscal Years Ended June 30 2022 2021 2020 2019
Actuarially determined contributions $ 19,491,065 $ 17,489,949 $ 15,875,859 $ 15,691,168 Contributions in relation to the
actuarially determined contributions (19,491,065) (17,489,949) (15,875,859) (15,691,168) Contribution deficiency (excess) $ - $ - $ - $ - Covered payroll $ 23,476,513 $ 21,764,291 $ 27,964,303 $ 29,663,516 Contributions as a percentage of
covered payroll 83.02% 80.36% 56.77% 52.90%
* Historical information is required only for measurement periods for which GASB 68 is applicable
Notes to Schedule:
Valuation date:
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry age normal
Amortization method/period For details, see June 30, 2019 Funding Valuation Report.
Asset valuation method
Inflation
Salary Increases
Payroll growth
Investment rate of return
Retirement age
Mortality
Other information
Safety
Fair value of assets. For details, see June 30, 2019 Funding Valuation Report.
7.00%, net of pension plan investment administrative expenses; includes inflation.
The probabilities of retirement are based on the 2017 CalPERS Experience Study which are incorporated in the current valuation.
For changes to previous year's information, refer to past GASB 68 reports. 6/30/2019
2.50%
Varies by entry age and service
2.75%
The probabilities of retirement are based on the 2017 CalPERS Experience Study which are incorporated in the current valuation. The pre-retirement mortality non- industrial death rates vary by age and gender. Industrial death rates vary by age.
The non-industrial death rates are used for all plans. The industrial death rates are used for safety plans. Miscellaneous plans usually have industrial death rates set to zero unless the agency has specifically contracted for industrial death benefits. The post-retirement mortality rates include 15 years of projected on-going mortality improvement using 90 percent of Scale MP 2016 published by the Society of Actuaries.
CITY OF GARDEN GROVE
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS
AGENT MULTIPLE EMPLOYER DEFINED BENEFIT PENSION PLANS
THE LAST TEN FISCAL YEARS*
106
2018 2017 2016 2015 2014
$ 14,147,727 $ 13,302,273 $ 11,468,654 $ 10,155,643 $ 9,427,732 (14,147,727) (13,302,273) (11,468,654) (10,155,643) (9,427,732) $ - $ - $ - $ - $ - $ 28,541,707 $ 28,636,267 $ 27,481,750 $ 26,325,623 $ 26,592,225
49.57% 46.45% 41.73% 38.58% 35.45%
Safety
107
2021 2020 2019 2018 2017
TOTAL OPEB LIABILITY
Service cost 2,563,528$ 1,831,165$ 627,266$ 669,889$ 651,960$ Interest on Total OPEB Liability 1,219,928 1,596,249 695,181 695,599 610,096 Employer Contributions - - (467,790) (420,642) - Expected Minus Actual Benefit Payments - - 22,763 - - Experience (Gains)/Losses (11,665,240) (94,837) (216,121) - - Changes in Assumptions 3,457,450 8,191,623 26,892,575 (922,346) - Benefit payments (2,112,394) (2,036,122) - - (391,489) (6,536,728) 9,488,078 27,553,874 22,500 870,567 55,245,075 45,756,997 18,203,123 18,180,623 17,310,056 48,708,347$ 55,245,075$ 45,756,997$ 18,203,123$ 18,180,623$ Plan fiduciary net position as a percentage of the total OPEB liability 0.00% 0.00% 0.00% 0.00% 0.00% 56,905,216 56,638,122 55,122,260 55,704,304 57,674,182 Net OPEB liability as a percentage of covered-employee payroll 85.60% 97.54% 83.01% 32.68% 31.52% Notes to Schedule:
Net change in total OPEB liability
Total OPEB liability - beginning
Total OPEB liability - ending
Covered-employee payroll
*Historical information is required only for measurement periods for which GASB 75 is applicable. Future years' information will be displayed up to 10 years as information becomes available.
** Liabilities reflect an impilcit rate subsidy for Pre-Medicare retirees. GASB 74 and 75 require use of claims costs or age-adjusted premiums approximating claims costs to determine the plan's liability. Adjusting premiums for age creates Implicit Subsidy and is reflected as part of the plan's liability.
Measurement Period
CITY OF GARDEN GROVE
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN THE TOTAL OPEB LIABILITY AND RELATED RATIOS for the Measurement Periods Ended June 30
THE LAST TEN FISCAL YEARS*
108
CITY OF GARDEN GROVE
NOTE TO REQUIRED SUPPLEMENTARY INFORMATION
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Under Article XIIIB of the California Constitution (the GANN Spending Limitation Initiative), the City is restricted as to the amount of annual appropriations, and if certain proceeds of taxes exceed allowed appropriations, the excess must be refunded to the taxpayers either through revised tax rates or revised fee schedules.
The City budget report is prepared under the direction of the City Manager in accordance with generally accepted accounting principles (GAAP) and the requirements of Municipal Code Section 2.08.150. Annual budgets are legally adopted for the general fund, special revenue funds, and capital projects funds. These funds are budgeted based on the modified accrual basis of accounting and include proposed expenditures and the means of financing them. The City Council approves the total budgeted appropriations and any amendments to total appropriations which may be required during the year. Revenues are budgeted by source, and expenditures are budgeted by program.
The legal level of budgetary control is considered to be at the fund level since management can reassign resources within a fund without special approval from City Council. The City Manager is authorized to transfer budgeted amounts between departments within any fund; however, any revisions which alter the total appropriations of any fund must be approved by City Council.
109
Other Supplemental
Information
Other
Supplemental
Information
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CITY OF GARDEN GROVE
SPECIAL REVENUE FUNDS
Public Safety Fund
Revenues received from the City's share of drug forfeit and seizure money, revenues received from the state under SB172, and various police grants are accounted for in this fund. These funds are used to help support the City's public safety operations.
State Gas Tax Fund
State gasoline taxes received by the City are accounted for in this fund. Revenue received is used for street maintenance, construction, and/or right of way acquisition.
Developer Fees Fund
Traffic mitigation and developer fees used to alleviate traffic and sewer problems caused by new development, cultural art fees to be used for City cultural arts projects and programs, park fees which are to be used for park development, drainage fees which are to be used to alleviate City drainage problems are some of the fees that are accounted for in the fund.
Garden Grove Cable Fund
This fund represents a grant from a private cable corporation of 2% and its cable usage revenue.
Expenditures are for public, educational, and governmental access.
Street Lighting Fund
The purpose of this fund is to provide an accounting for the installation, operation, and maintenance of street lighting within the City. Revenues for this fund are received from property taxes collected by the County of Orange.
Park Maintenance
The purpose of this fund is to provide an accounting for the maintenance of parks within the City.
Revenues for this fund are received from property taxes collected by the County of Orange.
Main Street District Fund
This fund is used to account for the maintenance of improvements on Main Street in downtown Garden Grove. Revenue for this fund are received from a property tax levy on the main street area.
Air Quality Improvement Fund
This fund is used to account for revenue received from the South Coast Air Quality Management District for the primary purpose of establishing a ride share program for City employees. 110
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CITY OF GARDEN GROVE
SPECIAL REVENUE FUNDS (CONTINUED)
Garden Grove Tourism Improvement District
This fund is used to account for the tourism marketing efforts through the Anaheim/Orange County Visitors and Convention Bureau and other activities and improvements that promote tourism in the Garden Grove Tourism Improvement District area.
Street Rehabilitation Fund
This fund is used to account for revenues received and expenditures made for various street rehabilitation projects.
HOME Grant Special Revenue Fund
The HOME Grant special revenue fund is used to account for the revenues received and expenditures made for the housing assistance program, which is funded by the U.S. Department of Housing and Urban Development.
CAPITAL PROJECTS FUNDS
Housing Authority Assets Fund
Capital projects with the Civic Center area are accounted for in this fund.
Housing Successor Agency Low/Mod Fund
Capital projects for low and moderate income housing are accounted for in this fund.
Public Safety Fund
Capital projects with Public Safety are accounted for in this fund. 111
Public State Developer Garden Grove
Safety Gas Tax Fees Cable
ASSETS
Cash and investments 2,658,489$ 5,811,353$ 12,970,425$ 2,788$ Cash with fiscal agents - - - - Taxes receivable 173,330 920,373 - - Accounts receivable - - - 3,965 Interest receivable 1,706 3,715 8,326 - Due from Successor Agency - - - - Deposits and prepaid items 11,120 - - 13,505 Intergovernmental receivable - - - - Notes receivable, net - - - - Land held for resale - - - - Total assets 2,844,645$ 6,735,441$ 12,978,751$ 20,258$
Liabilities:
Accounts payable 363,260$ 812,895$ 560,135$ 3,287$ Accrued liabilities 4,366 121,619 53,602 7,153 Due to other funds 254 1,714 13 62 Total liabilities 367,880 936,228 613,750 10,502 Deferred Inflows of Resources:
Unavailable revenue - - - - Total deferred inflows - - - - Fund balances:
Non-Spendable:
Deposits and Prepaid items 11,120 - - 13,505 Restricted:
Public safety 2,465,645 - - - Public right of way - 5,799,213 2,466,921 - Drainage - - 106,625 - Community planning and development - - 1,856,644 - - - 7,934,811 - Unassigned - - - (3,749) Total fund balances 2,476,765 5,799,213 12,365,001 9,756 Total liabilities and fund balances 2,844,645$ 6,735,441$ 12,978,751$ 20,258$ Community services
LIABILITIES AND FUND BALANCES
CITY OF GARDEN GROVE
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
JUNE 30, 2022
Special Revenue Funds
112
Street Park Main Street Air Quality
Lighting Maintenance District Improvement
245,970$ 116,927$ 211,716$ 440,977$ - - - -
13,193 6,450 - -
2,045 - - - 153 75 136 283 - - - -
- - - -
- - - 56,727 - - - -
- - - -
261,361$ 123,452$ 211,852$ 497,987$ 133,344$ 13,041$ 1,702$ 1,370$ 3,702 21,649 - 2,326 73 1,675 - 26 137,119 36,365 1,702 3,722 - - - -
- - - - - - - - - - - - 124,242 - 210,150 494,265 - - - - - 87,087 - - - - - - - - - -
124,242 87,087 210,150 494,265 261,361$ 123,452$ 211,852$ 497,987$ Special Revenue Funds
113
GG Tourism HOME Grant
Improvement Street Special Revenue
District Rehabilitation Fund
ASSETS
Cash and investments 240,503$ 1,816,744$ -$ Cash with fiscal agents - - - Taxes receivable 313,871 - - Accounts receivable - - - Interest receivable - 1,181 - Due from Successor Agency - - - Deposits and prepaid items - - - Intergovernmental receivable - 1,349,051 577,404 Notes receivable, net - - 18,466,076 Land held for resale - - - Total assets 554,374$ 3,166,976$ 19,043,480$
Liabilities:
Accounts payable 268,990$ 329,698$ 116,209$ Accrued liabilities - 36,335 - Due to other funds - 41 239,694 Total liabilities 268,990 366,074 355,903 Deferred Inflows of Resources:
Unavailable revenue - 740,732 - Total deferred inflows - 740,732 - Fund balances:
Non-Spendable:
Prepaid items - - - Restricted
Public safety - - - Public right of way - 2,060,170 - Drainage - - -
285,384 - 18,687,577
- - -
Unassigned - - -
Total fund balances 285,384 2,060,170 18,687,577 Total liabilities and fund balances 554,374$ 3,166,976$ 19,043,480$
CITY OF GARDEN GROVE
Special Revenue Funds
LIABILITIES AND FUND BALANCES
Community planning and development
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS (CONTINUED)
JUNE 30, 2022
Community services
114
Total
Housing Housing Nonmajor
Successor Successor Agency Public Governmental
Agency Low/Mod Safety Funds
679,014$ 8,061,942$ -$ 33,256,848$ - - 1,343,869 1,343,869 - - - 1,427,217 1,714 300 - 8,024 435 5,172 - 21,182 - 6,054,260 - 6,054,260 - - 6,250 30,875 - - - 1,983,182 1,922,258 5,751,812 - 26,140,146 - 519,063 - 519,063 2,603,421$ 20,392,549$ 1,350,119$ 70,784,666$
-$ 17,892$ 95,795$ 2,717,618$ - 624 24,280 275,656 - 4 244,990 488,546 - 18,520 365,065 3,481,820 - - - 740,732 - - - 740,732 - - 6,250 30,875 - - 978,804 3,444,449 - - - 11,154,961 - - - 106,625 2,603,421 20,374,029 - 43,894,142 - - - 7,934,811 - - - (3,749) 2,603,421 20,374,029 985,054 66,562,114 2,603,421$ 20,392,549$ 1,350,119$ 70,784,666$ Capital Project Funds
115
Public State Developer Garden Grove
Safety Gas Tax Fees Cable
REVENUES:
Taxes 932,404$ -$ -$ -$
Licenses and permits - - 58,149 - Investment earnings (loss) (85,963) (188,796) (426,054) - Charges for current services - - 3,529,940 - From other agencies 303,206 7,817,898 - - Other revenues - 5,208 - 32,154 Total revenues 1,149,647 7,634,310 3,162,035 32,154 EXPENDITURES:
Current:
Police 1,289,109 - - -
Traffic safety - 164,428 510,827 - Public right of way - 7,398,768 150,159 - Community services - - - 429,234 Economic development - - - - Parks and greenbelts - - 651,003 - Community planning and development - - 83,328 - Municipal support - - - - Debt service:
Principal - - - 42,329 Interest and fiscal charges - - - 381 Total expenditures 1,289,109 7,563,196 1,395,317 471,944 Excess (deficiency) of revenues
over (under) expenditures (139,462) 71,114 1,766,718 (439,790) OTHER FINANCING SOURCES (USES):
Transfers in - - - 438,542 Transfers out - - - - Total other financing sources (uses) - - - 438,542 Net change in fund balances (139,462) 71,114 1,766,718 (1,248) Fund balance (deficit), beginning of year 2,616,227 5,728,099 10,598,283 11,004 Fund balance (deficit), end of year 2,476,765$ 5,799,213$ 12,365,001$ 9,756$ Special Revenue Funds
CITY OF GARDEN GROVE
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
116
Street Park Main Street Air Quality
Lighting Maintenance District Improvement
- $ -$ -$ -$
- - - -
(1,239) (3,957) (6,816) (14,338) 1,364,858 708,643 26,924 -
- - - 223,763 - - - -
1,363,619 704,686 20,108 209,425 - - - -
1,681,664 - - -
- - 32,214 -
- - - -
- - - -
- 700,333 - -
- - - 16,182 22,497 - - 132,566 - - - -
- - - -
1,704,161 700,333 32,214 148,748 (340,542) 4,353 (12,106) 60,677 392,962 333 - -
- - - -
392,962 333 - -
52,420 4,686 (12,106) 60,677 71,822 82,401 222,256 433,588 124,242$ 87,087$ 210,150$ 494,265$ Special Revenue Funds
117
GG Tourism
Improvement Street
District Rehabilitation HOME Grant
REVENUES:
Taxes 2,581,171$ -$ -$
Licenses and permits - - - Investment earnings (loss) - (64,259) 394,390 Charges for current services - - - From other agencies - 3,498,197 1,404,484 Other revenues - - - Total revenues 2,581,171 3,433,938 1,798,874 EXPENDITURES:
Current:
Police - - -
Traffic safety - 164,177 - Public right of way - 2,332,502 - Community services - 35,175 - Economic Development 1,812,383 - - Parks and greenbelts - - - Community planning and development - - 612,435 Municipal support - - - Debt service:
Principal - - -
Interest and fiscal charges - - - Total expenditures 1,812,383 2,531,854 612,435 Excess (deficiency) of revenues
over (under) expenditures 768,788 902,084 1,186,439 OTHER FINANCING SOURCES (USES):
Transfers in - - - Transfers out (616,344) - - Total other financing sources (uses) (616,344) - - Net change in fund balances 152,444 902,084 1,186,439 Fund balance (deficit), beginning of year 132,940 1,158,086 17,501,138 Fund balance (deficit), end of year 285,384$ 2,060,170$ 18,687,577$
CITY OF GARDEN GROVE
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS (CONTINUED)
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Special Revenue Funds
118
Total
Housing Housing Nonmajor
Authority Successor Agency Public Governmental
Assets Low/Mod Safety Funds
-$ -$ -$ 3,513,575$ - - - 58,149 51,175 (179,294) 81 (525,070) - - - 5,630,365 - - - 13,247,548 - 89,877 - 127,239 51,175 (89,417) 81 22,051,806 - - 649,198 1,938,307 - - - 2,521,096 - - - 9,913,643 - - - 464,409 351 - - 1,812,734 - - - 1,351,336 - 299,435 - 1,011,380 - - - 155,063 - - - 42,329 - - - 381 351 299,435 649,198 19,210,678 50,824 (388,852) (649,117) 2,841,128 - - - 831,837 - - - (616,344) - - - 215,493 50,824 (388,852) (649,117) 3,056,621 2,552,597 20,762,881 1,634,171 63,505,493 2,603,421$ 20,374,029$ 985,054$ 66,562,114$ Capital Project Funds
119
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Taxes 774,000$ 774,000$ 932,404$ 158,404$ Investment earnings (loss) - - (85,963) (85,963) From other agencies 300,000 300,000 303,206 3,206 Total revenues 1,074,000 1,074,000 1,149,647 75,647 EXPENDITURES:
Current:
Police 1,086,304 1,598,993 1,289,109 309,884 Total expenditures 1,086,304 1,598,993 1,289,109 309,884 Net change in fund balance (12,304) (524,993) (139,462) 385,531 Fund balance, beginning of year 2,616,227 2,616,227 2,616,227 - Fund balance, end of year 2,603,923$ 2,091,234$ 2,476,765$ 385,531$
CITY OF GARDEN GROVE
PUBLIC SAFETY SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
120
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Investment earnings (loss) -$ -$ (188,796)$ (188,796)$ From other agencies 7,567,000 7,567,000 7,817,898 250,898 Other revenues - - 5,208 5,208 Total revenues 7,567,000 7,567,000 7,634,310 67,310 EXPENDITURES:
Current:
Traffic safety 181,833 181,833 164,428 17,405 Public right of way 7,718,167 12,432,384 7,398,768 5,033,616 Total expenditures 7,900,000 12,614,217 7,563,196 5,051,021 Net change in fund balance (333,000) (5,047,217) 71,114 5,118,331 Fund balance, beginning of year 5,728,099 5,728,099 5,728,099 - Fund balance, end of year 5,395,099$ 680,882$ 5,799,213$ 5,118,331$
CITY OF GARDEN GROVE
STATE GAS TAX SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
121
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Licenses and permits 50,000$ 50,000$ 58,149$ 8,149$ Investment earnings (loss) - - (426,054) (426,054) Charges for current services 2,075,000 2,075,000 3,529,940 1,454,940 Total revenues 2,125,000 2,125,000 3,162,035 1,037,035 EXPENDITURES:
Current:
Traffic safety 795,000 1,579,379 510,827 1,068,552 Public right of way 100,000 154,123 150,159 3,964 Parks and greenbelts 1,700,400 2,282,721 651,003 1,631,718 Community planning and development 223,817 819,608 83,328 736,280 Total expenditures 2,819,217 4,835,831 1,395,317 3,440,514 Net change in fund balance (694,217) (2,710,831) 1,766,718 4,477,549 Fund balance, beginning of year 10,598,283 10,598,283 10,598,283 - Fund balance, end of year 9,904,066$ 7,887,452$ 12,365,001$ 4,477,549$
CITY OF GARDEN GROVE
DEVELOPER FEES SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
122
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Other revenues 65,000$ 65,000$ 32,154$ (32,846)$ Total revenues 65,000 65,000 32,154 (32,846) EXPENDITURES:
Current:
Community services 510,021 510,021 429,234 80,787 Debt service: -
Principal retirement - - 42,329 (42,329) Interest 43,550 43,550 381 43,169 Total expenditures 553,571 553,571 471,944 81,627 Excess (deficiency) of revenues
over (under) expenditures (488,571) (488,571) (439,790) 48,781 OTHER FINANCING SOURCES (USES):
Transfers in 488,572 488,572 438,542 (50,030) Total other financing sources (uses) 488,572 488,572 438,542 (50,030) Net change in fund balance 1 1 (1,248) (1,249) Fund balance, beginning of year 11,004 11,004 11,004 - Fund balance, end of year 11,005$ 11,005$ 9,756$ (1,249)$
CITY OF GARDEN GROVE
GARDEN GROVE CABLE SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
123
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Investment earnings (loss) -$ -$ (1,239)$ (1,239)$ Charges for current services 1,338,348 1,338,348 1,364,858 26,510 Total revenues 1,338,348 1,338,348 1,363,619 25,271 EXPENDITURES:
Current:
Traffic safety 1,313,110 1,313,110 1,681,664 (368,554) Municipal support 25,238 25,238 22,497 2,741 Total expenditures 1,338,348 1,338,348 1,704,161 (365,813) Excess (deficiency) of revenues
over (under) expenditures - - (340,542) (340,542) OTHER FINANCING SOURCES (USES):
Transfers in - - 392,962 392,962 Total other financing sources (uses) - - 392,962 392,962 Net change in fund balance - - 52,420 52,420 Fund balance, beginning of year 71,822 71,822 71,822 - Fund balance, end of year 71,822$ 71,822$ 124,242$ 52,420$
CITY OF GARDEN GROVE
STREET LIGHTING SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
124
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Investment earnings (loss) -$ -$ (3,957)$ (3,957)$ Charges for current services 708,000 708,000 708,643 643 Total revenues 708,000 708,000 704,686 (3,314) EXPENDITURES:
Current:
Parks and greenbelts 700,000 700,000 700,333 (333) Total expenditures 700,000 700,000 700,333 (333) Excess (deficiency) of revenues
over (under) expenditures 8,000 8,000 4,353 (3,647) OTHER FINANCING SOURCES (USES):
Transfers in - - 333 333 Total other financing sources (uses) - - 333 333 Net change in fund balance 8,000 8,000 4,686 (3,314) Fund balance, beginning of year 82,401 82,401 82,401 - Fund balance, end of year 90,401$ 90,401$ 87,087$ (3,314)$
CITY OF GARDEN GROVE
PARK MAINTENANCE SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
125
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Investment earnings (loss) -$ -$ (6,816)$ (6,816)$ Charges for current services 26,700 26,700 26,924 224 Total revenues 26,700 26,700 20,108 (6,592) EXPENDITURES:
Current:
Public right of way 36,600 153,415 32,214 121,201 Total expenditures 36,600 153,415 32,214 121,201 Net change in fund balance (9,900) (126,715) (12,106) 114,609 Fund balance, beginning of year 222,256 222,256 222,256 - Fund balance, end of year 212,356$ 95,541$ 210,150$ 114,609$
CITY OF GARDEN GROVE
MAIN STREET DISTRICT SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
126
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Investment earnings (loss) -$ -$ (14,338)$ (14,338)$ From other agencies 240,000 240,000 223,763 (16,237) Total revenues 240,000 240,000 209,425 (30,575) EXPENDITURES:
Current:
Community planning and development 17,235 158,235 16,182 142,053 Municipal support 259,352 434,998 132,566 302,432 Total expenditures 276,587 593,233 148,748 444,485 Excess (deficiency) of revenues
over (under) expenditures (36,587) (353,233) 60,677 413,910 Net change in fund balance (36,587) (353,233) 60,677 413,910 Fund balance, beginning of year 433,588 433,588 433,588 - Fund balance, end of year 397,001$ 80,355$ 494,265$ 413,910$
CITY OF GARDEN GROVE
AIR QUALITY IMPROVEMENT SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
127
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Taxes 2,824,936$ 2,824,936$ 2,581,171$ (243,765)$ Total revenues 2,824,936 2,824,936 2,581,171 (243,765) EXPENDITURES:
Current:
Economic development 2,824,936 2,824,936 1,812,383 1,012,553 Total expenditures 2,824,936 2,824,936 1,812,383 1,012,553 Excess (deficiency) of revenues
over (under) expenditures - - 768,788 768,788 OTHER FINANCING SOURCES (USES):
Transfers out (883,634) (883,634) (616,344) 267,290 Total other financing sources (uses) (883,634) (883,634) (616,344) 267,290 Net change in fund balance (883,634) (883,634) 152,444 1,036,078 Fund balance, beginning of year 132,940 132,940 132,940 - Fund balance (deficit), end of year (750,694)$ (750,694)$ 285,384$ 1,036,078$
CITY OF GARDEN GROVE
GARDEN GROVE TOURISM IMPROVEMENT DISTRICT SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
128
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Investment earnings (loss) -$ -$ (64,259)$ (64,259)$ From other agencies 3,927,531 3,927,531 3,498,197 (429,334) Total revenues 3,927,531 3,927,531 3,433,938 (493,593) EXPENDITURES:
Current:
Traffic safety - - 164,177 (164,177) Public right of way 3,722,531 4,010,132 2,332,502 1,677,630 Community services 205,000 298,333 35,175 263,158 Total expenditures 3,927,531 4,308,465 2,531,854 1,776,611 Net change in fund balance - (380,934) 902,084 1,283,018 Fund balance, beginning of year 1,158,086 1,158,086 1,158,086 - Fund balance, end of year 1,158,086$ 777,152$ 2,060,170$ 1,283,018$
CITY OF GARDEN GROVE
STREET REHABILITATION SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
129
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Investment earnings -$ -$ 394,390$ 394,390$ From other agencies 893,015 893,015 1,404,484 511,469 Other revenues - - - - Total revenues 893,015 893,015 1,798,874 905,859 EXPENDITURES:
Current:
Community planning and development 893,015 1,290,193 612,435 677,758 Total expenditures 893,015 1,290,193 612,435 677,758 Net change in fund balance - (397,178) 1,186,439 1,583,617 Fund balance, beginning of year 17,501,138 17,501,138 17,501,138 - Fund balance, end of year 17,501,138$ 17,103,960$ 18,687,577$ 1,583,617$
CITY OF GARDEN GROVE
HOME GRANT SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
130
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Investment earnings (loss) -$ -$ 51,175$ 51,175$ Total revenues - - 51,175 51,175 EXPENDITURES:
Current:
Economic development 37,000 181,084 351 (180,733) Total expenditures 37,000 181,084 351 (180,733) Net change in fund balance (37,000) (181,084) 50,824 (129,558) Fund balance, beginning of year 2,552,597 2,552,597 2,552,597 - Fund balance, end of year 2,515,597$ 2,371,513$ 2,603,421$ (129,558)$
CITY OF GARDEN GROVE
HOUSING AUTHORITY ASSETS CAPITAL PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
131
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Investment earnings (loss) -$ -$ (179,294)$ (179,294)$ Other revenues 329,343 329,343 89,877 (239,466) Total revenues 329,343 329,343 (89,417) (418,760) EXPENDITURES:
Current:
Community planning and development 300,954 462,033 299,435 162,598 Total expenditures 300,954 462,033 299,435 162,598 Net change in fund balance 28,389 (132,690) (388,852) (256,162) Fund balance, beginning of year 20,762,881 20,762,881 20,762,881 - Fund balance, end of year 20,791,270$ 20,630,191$ 20,374,029$ (256,162)$
CITY OF GARDEN GROVE
HOUSING SUCCESSOR AGENCY LOW/MOD CAPITAL PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
132
Variance with
Original Final Final Budget
Budgeted Budgeted Actual Positive
Amounts Amounts Amounts (Negative)
REVENUES:
Investment earnings -$ -$ 81$ 81$ Total revenues - - 81 81 EXPENDITURES:
Current:
Police - 1,550,000 649,198 900,802 Total expenditures - 1,550,000 649,198 900,802 Net change in fund balance - (1,550,000) (649,117) 900,883 Fund balance, beginning of year 1,634,171 1,634,171 1,634,171 - Fund balance, end of year 1,634,171$ 84,171$ 985,054$ 900,883$
CITY OF GARDEN GROVE
PUBLIC SAFETY CAPITAL PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
133
CITY OF GARDEN GROVE
NONMAJOR ENTERPRISE FUNDS
Solid Waste Disposal Fund
The Solid Waste Disposal fund accounts for the operation of trash and solid waste collections and disposal services.
Golf Course Fund
The fund was established to account for operations of the Willowick Golf Course. 134
134
Solid Waste Golf Total Nonmajor
Disposal Course Enterprise Funds
ASSETS
Current Assets:
Cash and cash investments 13,191,804$ 417,744$ 13,609,548$ Taxes receivable 376,800 - 376,800 Accounts receivable 452,321 18,594 470,915 Interest receivable 8,466 98 8,564 Inventory - 12,589 12,589 Prepaid Items - 89,141 89,141 Total current assets 14,029,391 538,166 14,567,557 Noncurrent Assets:
Capital assets
Land - 3,132,711 3,132,711 Construction in progress - 20,325 20,325 Depreciable capital assets, net - 232,050 232,050 Total noncurrent assets - 3,385,086 3,385,086 Total assets 14,029,391 3,923,252 17,952,643
DEFERRED OUTFLOWS OF RESOURCES
OPEB related 243,922 - 243,922 Pension related 269,056 - 269,056 Total Deferred Outflows 512,978 - 512,978
LIABILITIES
Current Liabilities:
Accounts payable 119,086 119,692 238,778 Accrued liabilities 9,531 - 9,531 Interest payable - 14 14 Refundable deposits 1,014,030 - 1,014,030 Due to other funds 87 - 87 Current portion of long term liabilities
Leases payable - 111,454 111,454 Total current liabilities 1,142,734 231,160 1,373,894 Noncurrent liabilities:
Leases payable - 57,586 57,586 Net pension liability 1,351,984 - 1,351,984 OPEB liabilitiy 404,458 - 404,458 Total noncurrent liabilities 1,756,442 57,586 1,814,028 Total liabilities 2,899,176 288,746 3,187,922
DEFERRED INFLOWS OF RESOURCES
OPEB related 93,831 - 93,831 Pension related 570,406 - 570,406 Total Deferred Inflows 664,237 - 664,237
NET POSITION
Net investment in capital assets - 3,216,046 3,216,046 Unrestricted 10,978,956 418,460 11,397,416 Total net position 10,978,956$ 3,634,506$ 14,613,462$
CITY OF GARDEN GROVE
COMBINING STATEMENT OF NET POSITION
NONMAJOR ENTERPRISE FUNDS
JUNE 30, 2022
135
135
Solid Waste Golf Total Nonmajor
Disposal Course Enterprise Funds
Operating revenues:
Charges for services -$ 1,744,025$ 1,744,025$ Solid waste disposal fees 2,519,405 - 2,519,405 Property assessments 502,231 - 502,231 Other 919,054 - 919,054 Total operating revenues 3,940,690 1,744,025 5,684,715
Operating expenses:
Salaries and benefits 606,783 - 606,783 Contractual services 1,271,073 - 1,271,073 Materials and supplies 7,671 - 7,671 Golf course operations - 1,647,260 1,647,260 Depreciation - 115,522 115,522 Total operating expenses 1,885,527 1,762,782 3,648,309
Operating income (loss) 2,055,163 (18,757) 2,036,406
Nonoperating revenues:
Investment income (loss) (425,581) (4,909) (430,490) Interest expense - (376) (376) Total nonoperating revenue (425,581) (5,285) (430,866) Change in net position 1,629,582 (24,042) 1,605,540 Total net position, beginning of year,
as restated 9,349,374 3,658,548 13,007,922 Total net position, end of year 10,978,956$ 3,634,506$ 14,613,462$
CITY OF GARDEN GROVE
COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION
NONMAJOR ENTERPRISE FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
136
136
Solid Waste Golf Total Nonmajor
Disposal Course Enterprise Funds
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers 3,943,770$ 1,737,771$ 5,681,541$ Payments to suppliers (1,231,959) (1,694,200) (2,926,159) Payments to employees (697,484) - (697,484) Net cash provided (used) by operating
activities 2,014,327 43,571 2,057,898
CASH FLOWS FROM NON CAPITAL
FINANCING ACTIVITIES
Cash paid to other funds (21,663) - (21,663) Net cash provided (used) by non capital
financing activities (21,663) - (21,663)
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Purchases of capital assets - (56,484) (56,484) Principal payments on capital debt - (111,280) (111,280) Interest paid on capital debt - (362) (362) Net cash (used) by capital and
related financing activities - (168,126) (168,126)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest earnings 143,273 2,022 145,295 Increase (decrease) in fair value of investments (527,378) (6,130) (533,508) Net cash provided by investing activities (384,105) (4,108) (388,213) Net increase (decrease) in cash and
cash equivalents 1,608,559 (128,663) 1,479,896 Cash and cash equivalents, beginning of year 11,583,245 546,407 12,129,652 Cash and cash equivalents, end of year 13,191,804$ 417,744$ 13,609,548$
Reconciliation of operating income (loss)
to net cash provided (used) by operating
activities:
Operating income (loss) 2,055,163$ (18,757)$ 2,036,406$ Adjustments to reconcile operating
income (loss) to net cash provided (used)
by operating activities:
Depreciation expense - 115,522 115,522 Changes in assets and liabilities:
(Increase) decrease in taxes receivable (180,925) - (180,925) (Increase) decrease in accounts receivable (275,495) (6,254) (281,749) (Increase) decrease in inventory - (4,918) (4,918) (Increase) decrease in prepaid expense - 8,104 8,104 Increase (decrease) in accounts payable 46,785 (50,126) (3,341) Increase (decrease) in accrued liabilities (14,078) - (14,078) Increase (decrease) in refundable deposits 459,500 - 459,500 Increase (decrease) in OPEB liability and related
changes in deferred outflows and inflows of resources 51,365 - 51,365 Increase (decrease) in net pension liability and related changes in deferred outflows and inflows of resources (127,988) - (127,988) Total adjustments (40,836) 62,328 21,492 Net cash provided (used) by operating
activities 2,014,327$ 43,571$ 2,057,898$
CITY OF GARDEN GROVE
COMBINING STATEMENT OF CASH FLOWS
NONMAJOR ENTERPRISE FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
137
137
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CITY OF GARDEN GROVE
INTERNAL SERVICE FUNDS
Workers’ Compensation Fund
The City’s self-funded workers’ compensation program, which is accounted for in this fund, is financed by charges to all City departments based on number and classification of employees. Expenses include operating costs and all payments relating to injured employees.
Fleet Management Fund
The costs of operating and maintaining City owned vehicles and other gasoline-powered equipment are accounted for in this fund. The fund is financed by charges to the various City departments for actual cost plus a contributory sum for vehicles/equipment replacement. Actual costs include depreciation, maintenance and other factors necessary for the provision of the service.
Employee Benefits Fund
This fund encompasses all other employee benefits such as retirement contributions, health, dental, disability, life insurance, and sick leave, vacation, and other paid leaves. Revenues for this fund are derived from periodic charges to all departments based on the number of employees, length of service, and insurance coverage. Funds are used to pay actual expenses and to accrue existing liabilities.
Information Systems Fund
This fund encompasses the cost of operating and maintaining the City's computer system. The fund is financed by charges to the various City departments based on computer usage.
Warehouse Operations Fund
This fund is used to account for the provision of materials and supplies to the various City departments. Financing is provided by the user City departments by payment of costs of material and supplies plus an overhead charge.
Telephone System Fund
This fund accounts for the operation of the City’s telephone system. The financing comes from charges to the various City departments based on actual toll charges and the lease cost prorated on the number of instruments.
Risk Management Fund
This fund is used to account for the City’s self-insured liability program and for the purchase of various types of property and casualty insurance protection as required by the City. The funds are used to pay any liability losses, program operating costs, insurance premiums and insurance deductibles.
Revenues for this fund are generated from assessments made to all City departments for their pro-rata share of the total costs of the insurance administration program.
Communication Replacement Fund
This fund is used to account for both the operating and capital costs of the City’s communication system in relation to the county-wide 800MHZ backbone project. Funds are used to pay for the City’s backbone costs and the capital costs incurred to upgrade its communications equipment to integrate with the county-wide communications system. The financing comes from charges to the various City departments based on an allocation of actual costs. Actual costs include depreciation and maintenance. 138
Workers' Fleet Employee Information
Compensation Management Benefits Systems
ASSETS
Current Assets:
Cash and cash investments 36,431,803$ 40,496,130$ 17,067,160$ 5,756,829$ Accounts receivable, net 48 - 26,317 - Interest receivable 23,207 25,970 13,174 3,688 Due from other funds 91,247 - 239,694 - Inventory - 93,736 - - Prepaid items - 138 30,786 153,929 Total current assets 36,546,305 40,615,974 17,377,131 5,914,446 Noncurrent Assets:
Intercity loans receivable - 1,602,024 - - Capital assets:
Construction in progress - 695,173 - 9,960 Depreciable capital assets, net - 10,957,651 - 86,356 Total noncurrent assets - 13,254,848 - 96,316 Total assets 36,546,305 53,870,822 17,377,131 6,010,762
DEFERRED OUTFLOWS OF RESOURCES
OPEB related - 348,460 - 731,766 Pension related - 371,740 - 712,285 Total Deferred Outflows - 720,200 - 1,444,051
LIABILITIES
Current Liabilities:
Accounts payable 2,773 241,450 28,366 603,009 Accrued liabilities 19,899 23,009 566,991 50,021 Due to other funds 48 1,352 - 395 Current portion of long term liabilities
Leases payable - - - 15,976 Accrued compensated absences - - 7,677,171 - Claims payable 4,832,896 - - - Total current liabilities 4,855,616 265,811 8,272,528 669,401 Noncurrent liabilities:
Accrued compensated absences - - 237,438 - Claims payable 34,732,351 - - - Intercity loans payable - - - - Net pension liability - 1,867,958 - 3,579,165 OPEB liabilitiy - 577,798 - 1,213,375 Total noncurrent liabilities 34,732,351 2,445,756 237,438 4,792,540 Total liabilities 39,587,967 2,711,567 8,509,966 5,461,941
DEFERRED INFLOWS OF RESOURCES
OPEB related - 134,044 - 281,493 Pension related - 788,098 - 1,510,061 Total Deferred Inflows - 922,142 - 1,791,554
NET POSITION
Net investment in capital assets - 11,652,824 - 80,340 Unrestricted (3,041,662) 39,304,489 8,867,165 120,978 Total net position (3,041,662)$ 50,957,313$ 8,867,165$ 201,318$
CITY OF GARDEN GROVE
COMBINING STATEMENT OF NET POSITION
INTERNAL SERVICE FUNDS
JUNE 30, 2022
139
Warehouse Telephone Risk Communication
Operations System Management Replacement Total
602,014$ 1,809,031$ 8,989,745$ 1,311,528$ 112,464,240 - - - - 26,365 386 1,160 5,724 842 74,151 - - - - 330,941 382,292 - - - 476,028 - - 34,357 - 219,210 984,692 1,810,191 9,029,826 1,312,370 113,590,935 - - 2,435,745 - 4,037,769 - - - - 705,133 - - - 1,603,076 12,647,083 - - 2,435,745 1,603,076 17,389,985 984,692 1,810,191 11,465,571 2,915,446 130,980,920 - - - - 1,080,226 - - - - 1,084,025 - - - - 2,164,251 51,422 4,804 23,837 19 955,680 4,400 3,164 2,482 - 669,966 338 24 20 - 2,177 - - - - 15,976 - - - - 7,677,171 - - 2,505,697 - 7,338,593 56,160 7,992 2,532,036 19 16,659,563 - - - - 237,438 - - 4,406,402 - 39,138,753 - - - 1,602,024 1,602,024 - - - - 5,447,123 - - - - 1,791,173 - - 4,406,402 1,602,024 48,216,511 56,160 7,992 6,938,438 1,602,043 64,876,074 - - - - 415,537 - - - - 2,298,159 - - - - 2,713,696 - - - 1,603,076 13,336,240 928,532 1,802,199 4,527,133 (289,673) 52,219,161 928,532$ 1,802,199$ 4,527,133$ 1,313,403$ 65,555,401$ 140
Workers' Fleet Employee Information
Compensation Management Benefits Systems
Operating revenues:
Charges for services 4,452,747$ 5,628,666$ 24,256,145$ 3,123,197$ Total operating revenues 4,452,747 5,628,666 24,256,145 3,123,197
Operating expenses:
Salaries and benefits 1,578,339 1,094,649 23,583,743 2,580,719 Contractual services 34,076 2,027,670 9,694 1,305,686 Liability claims 9,048,681 - 178,162 - Materials and supplies - 8,189 - 212,575 Depreciation - 1,552,480 - 97,621 Total operating expenses 10,661,096 4,682,988 23,771,599 4,196,601
Operating income (loss) (6,208,349) 945,678 484,546 (1,073,404)
Nonoperating revenues (expenses):
Investment income (loss) (1,161,772) (1,281,845) (763,425) (183,500) Gain (loss) on disposal of assets - 119,416 - - Interest expense - - - (451) Total nonoperating revenue
(expenses) (1,161,772) (1,162,429) (763,425) (183,951) Income (loss) before
transfers and capital contributions (7,370,121) (216,751) (278,879) (1,257,355) Capital contributions - 519,953 - - Transfers in - 38,554 - - Transfers out - - (826,958) - Change in net position (7,370,121) 341,756 (1,105,837) (1,257,355)
Total net position, beginning of year 4,328,459 50,615,557 9,973,002 1,458,673 Total net position, end of year (3,041,662)$ 50,957,313$ 8,867,165$ 201,318$
CITY OF GARDEN GROVE
COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION
INTERNAL SERVICE FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
141
Warehouse Telephone Risk Communication
Operations System Management Replacement Total
378,020$ 427,555$ 2,743,037$ 600,000$ 41,609,367$ 378,020 427,555 2,743,037 600,000 41,609,367 327,465 160,986 389,539 - 29,715,440 33,588 178,797 365,145 315 3,954,971 - - 4,742,011 - 13,968,854 3,437 - 2,316 - 226,517 - 62,028 - 301,497 2,013,626 364,490 401,811 5,499,011 301,812 49,879,408
13,530 25,744 (2,755,974) 298,188 (8,270,041)
(18,680) (58,188) (197,475) (42,213) (3,707,098) - - - - 119,416 - - - (22,919) (23,370) (18,680) (58,188) (197,475) (65,132) (3,611,052) (5,150) (32,444) (2,953,449) 233,056 (11,881,093) - - - - 519,953 - - - - 38,554 - - - - (826,958) (5,150) (32,444) (2,953,449) 233,056 (12,149,544) 933,682 1,834,643 7,480,582 1,080,347 77,704,945 928,532$ 1,802,199$ 4,527,133$ 1,313,403$ 65,555,401$ 142
Workers' Fleet Employee Information
Compensation Management Benefits Systems
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from user departments 4,452,699$ 5,636,134$ 24,273,946$ 3,123,197$ Payments to suppliers (5,408,721) (1,904,405) (187,856) (1,043,087) Payments to employees (1,578,339) (1,145,940) (8,544,422) (2,404,326) Payments for employee benefits - - (16,109,833) - Net cash (used) provided by operating
activities (2,534,361) 2,585,789 (568,165) (324,216)
CASH FLOWS FROM NON CAPITAL
FINANCING ACTIVITIES
Cash received from other funds 149,627 404,719 1,666,067 - Cash paid to other funds - - - (55,043) Net cash (used) provided by non capital
financing activities 149,627 404,719 1,666,067 (55,043)
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Purchases of capital assets - (1,380,757) - (63,063) Proceeds from sale of capital assets - 123,884 - - Principal paid on capital debt - - - (47,440) Interest paid on capital debt - - - (470) Net cash (used) by capital and
related financing activities - (1,256,873) - (110,973)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest earnings 432,213 482,001 116,935 70,151 Increase (decrease) in fair value of investments (1,445,684) (1,617,790) (820,655) (229,716) Net cash provided by investing activities (1,013,471) (1,135,789) (703,720) (159,565) Net increase (decrease) in cash and
cash equivalents (3,398,205) 597,846 394,182 (649,797) Cash and cash equivalents, beginning of year 39,830,008 39,898,284 16,672,978 6,406,626 Cash and cash equivalents, end of year 36,431,803$ 40,496,130$ 17,067,160$ 5,756,829$
Reconciliation of operating income (loss)
to net cash provided (used) by operating
activities:
Operating income (loss) (6,208,349)$ 945,678$ 484,546$ (1,073,404)$ Adjustments to reconcile operating
income (income) to net cash (used) provided
by operating activities:
Depreciation expense - 1,552,480 - 97,621 Changes in assets and liabilities:
(Increase) decrease in accounts receivable (48) 7,468 17,801 - (Increase) decrease in inventory - (39,005) - - (Increase) decrease in prepaid expense 140 - (30,786) (65,497) Increase (decrease) in accounts payable 2,773 181,700 (1,173,857) 552,035 Increase (decrease) in compensated absences - - (199,438) - Increase (decrease) in accrued liabilities (78,100) (11,241) 333,569 (11,364) Increase (decrease) in claims payable 3,749,223 - - - Increase (decrease) in OPEB liability and related
changes in deferred outflows and inflows of resources - 54,409 - 96,110 Increase (decrease) in net pension liability and related changes in deferred outflows and inflows of resources - (105,700) - 80,283 Total adjustments 3,673,988 1,640,111 (1,052,711) 749,188 Net cash (used) provided by operating
activities (2,534,361)$ 2,585,789$ (568,165)$ (324,216)$
CITY OF GARDEN GROVE
COMBINING STATEMENT OF CASH FLOWS
INTERNAL SERVICE FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
143
Warehouse Telephone Risk Communication
Operations System Management Replacement Total
378,020$ 427,555$ 2,743,037$ 600,000$ 41,634,588$ (4,196) (183,274) (4,964,671) (296) (13,696,506) (327,465) (160,986) (389,539) - (14,551,017) - - - - (16,109,833) 46,359 83,295 (2,611,173) 599,704 (2,722,768) - - 59,555 - 2,279,968 (9,557) (3,974) - (400,506) (469,080) (9,557) (3,974) 59,555 (400,506) 1,810,888
- - - - (1,443,820) - - - - 123,884 - (49,623) - - (97,063) - - - (22,919) (23,389)
- (49,623) - (22,919) (1,440,388)
7,495 20,803 203,446 14,430 1,347,474 (24,053) (72,257) (356,546) (52,426) (4,619,127) (16,558) (51,454) (153,100) (37,996) (3,271,653) 20,244 (21,756) (2,704,718) 138,283 (5,623,921) 581,770 1,830,787 11,694,463 1,173,245 118,088,161 602,014$ 1,809,031$ 8,989,745$ 1,311,528$ 112,464,240$
13,530$ 25,744$ (2,755,974)$ 298,188$ (8,270,041)$ - 62,028 - 301,497 2,013,626 - - - - 25,221 (7,188) - - - (46,193) 30 7,528 (29,563) - (118,148) 45,080 (10,932) 15,924 19 (387,258) - - - - (199,438) (5,093) (1,073) (12,429) - 214,269 - - 170,869 - 3,920,092 - - - - 150,519 - - - - (25,417) 32,829 57,551 144,801 301,516 5,547,273 46,359$ 83,295$ (2,611,173)$ 599,704$ (2,722,768)$
144
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Statistical Section
Statistical
Section
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Financial Trends
Schedule I - Net Position by Component
Schedule II - Changes in Net Position
Schedule III - Balance of Governmental Funds
Schedule IV - Changes in Fund Balances of Governmental Funds Schedule V - General Government Major Tax Revenues by Source Revenue Capacity
Schedule VI - Assessed Value and Estimated Actual Value of Taxable Property Schedule VII - Property Tax Rates Direct and Overlapping Governments Schedule VIII - Principal Property Tax Payers
Schedule IX - Property Tax Levies and Collections
Debt Capacity
Schedule X - Ratios of Outstanding Debt by Type
Schedule XI - Ratios of General Bonded Debt Outstanding Schedule XII - Direct and Overlapping Bonds and Debt
Schedule XIII - Legal Debt Margin Information
Schedule XIV - Pledged-Revenue Coverage
Demographics and Economic Information
Schedule XV - Demographic and Economic Statistics
Schedule XVI - Principal Employers
Operating Information
Schedule XVII - Full-Time and Part-Time City Employees by Department Schedule XVIII - Operating Indicators by Function
Schedule XIX - Capital Assets Statistics by Function
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial reports for the relevant year.
The City implemented GASB 34 in FY 2002; the government-wide schedules include information beginning in that year.
The City implemented GASB 54 in FY 2011; the balance of governmental funds schedule include information beginning in that year.
The City implemented GASB 65 in FY 2013; as a result, effective FY 2013, the names of Schedule I and Schedule II are changed to "Net Position by Component" and "Changes in Net Position", respectively.
The City implemented GASB 68 in FY 2015; the government-wide schedules include information beginning in that year.
Provides service and infrastructure information to assist readers using the City's financial statement to understand how it relates to the services and activities performed by the City.
This part of the City of Garden Grove Comprehensive Annual Financial Report provides detailed information to better understand information presented within the Financial Statements, note disclosures, and required supplementary information say about the City’s overall financial health.
Statistical Section
These schedules contain trend information to assist the reader understand and assess how the City’s financial position has changed over time.
These schedules contain information to help the reader assess the City’s most significant local revenue source, the property tax.
This information is intended to assist the user in understanding and assessing the affordability of the City's outstanding debt and the City's ability to issue additional debt.
This information assists the reader in understanding the socioeconomic environment within which the City's financial activities take place.
145
SCHEDULE I
CITY OF GARDEN GROVE
NET POSITION BY COMPONENT
LAST TEN FISCAL YEARS
(Accrual Basis of Accounting)
(In Thousands)
2013 2014 2015 2016
Governmental activities:
Net investment in
capital assets 643,095$ 644,220$ 642,786$ 641,661$ Restricted 22,114 22,150 17,848 21,967 Unrestricted 123,504 117,646 (83,857) (88,223) Total governmental
activities net position 788,713$ 784,016$ 576,777$ 575,405$ Business-type activities:
Net investment in
capital assets 97,657$ 107,299$ 111,947$ 117,488$ Restricted - - - -
Unrestricted 39,457 44,291 29,703 26,011 Total business-type
activities net position 137,114$ 151,590$ 141,650$ 143,499$ Primary government:
Net investment in
capital assets 740,752$ 751,519$ 754,733$ 759,149$ Restricted 22,114 22,150 17,848 21,967 Unrestricted 162,961 161,937 (54,154) (62,212) Total primary government
net position 925,827$ 935,606$ 718,427$ 718,904$ Source: Finance Department, City of Garden Grove
Fiscal Year
The City of Garden Grove implemented GASB 63 and GASB 65 for the fiscal year ended June 30, 2013, and GASB 68 for the fiscal year ended June 30, 2015. 146
Fiscal Year
2017 2018 2019 2020 2021 2022
631,964$ 622,932$ 621,163$ 619,138$ 617,316$ 618,070$ 24,613 65,456 69,820 72,470 75,669 77,360 (86,633) (111,538) (104,976) (108,833) (94,620) (35,673) 569,944$ 576,850$ 586,007$ 582,775$ 598,365$ 659,757$ 118,371$ 119,954$ 125,805$ 132,671$ 120,399$ 129,173$ - - - - - - 28,288 29,677 32,485 37,725 63,654 64,562 146,659$ 149,631$ 158,290$ 170,396$ 184,053$ 193,735$ 750,335$ 742,886$ 746,968$ 751,809$ 737,715$ 747,243$ 24,613 65,456 69,820 72,470 75,669 77,360 (58,345) (81,861) (72,491) (71,108) (30,966) 28,889 716,603$ 726,481$ 744,297$ 753,171$ 782,418$ 853,492$ 147
SCHEDULE II
CITY OF GARDEN GROVE
CHANGES IN NET POSITION
LAST TEN FISCAL YEARS
(Accrual Basis of Accounting)
(In Thousands)
2013 2014 2015 2016
Expenses:
Governmental activities:
Fire 20,273$ 20,876$ 21,939$ 20,700$
Police 45,467 49,289 50,837 47,309
Traffic safety 3,097 3,872 3,517 3,001 Public right of way 16,541 14,051 16,903 16,917 Drainage 1,426 1,284 1,445 1,453
Community buildings 4,596 4,504 4,973 4,691 Community services 4,452 4,679 4,797 4,606 Economic Development - - 1,944 2,333 Parks and greenbelts 1,838 1,973 2,146 1,957 Community planning and development 7,938 8,491 7,837 5,633 Municipal support 6,344 7,112 7,609 6,151 Interest on long-term debt 1,815 1,305 862 1,962 Total governmental activities
expenses 113,787 117,436 124,809 116,713
Business-type activities:
Water 26,419 26,761 30,003 26,982
Sanitary District 8,641 7,092 8,128 8,095 Mobile home parks/RV park - - - - Housing authority 31,586 30,489 30,707 36,947 Golf course - -
Total business-type activities expenses 66,646 64,342 68,838 72,024 Total primary government expenses 180,433 181,778 193,647 188,737 Program revenues:
Governmental activities:
Charges for services:
Fire 1,106 1,422 1,011 1,683
Police 3,486 3,169 3,019 2,717
Traffic safety 1,349 1,349 1,351 1,347 Public right of way 249 358 272 391 Drainage - - - - Community buildings - - - - Community services 851 859 986 768 Economic development - - - - Parks and greenbelts 1,319 1,282 1,264 1,226 Community planning and development 1,491 2,128 1,839 2,320 Municipal support 2,553 2,693 2,656 3,109 Operating grants and contributions 10,012 13,277 13,295 15,819 Capital grants and contributions 5,789 5,435 6,032 3,569 Total governmental activities program
revenues 28,205 31,972 31,725 32,949
Business-type activities:
Charges for services:
Water 33,738 35,186 33,145 29,158
Sanitary District 13,204 12,051 12,095 12,339 Mobile home parks - - - - Golf course - - - - Operating grants and contributions 30,582 30,656 30,726 31,730 Capital grants and contributions - - - - Total business-type activities program
revenues 77,524 77,893 75,966 73,227
Total primary government program
revenues 105,729 109,865 107,691 106,176
Net revenues (expenses):
Governmental activities (85,582) (85,464) (93,084) (83,764) Business-type activities 10,878 13,551 7,128 1,203 Total net revenues (expenses) (74,704)$ (71,913)$ (85,956)$ (82,561)$
Fiscal Year
148
2017 2018 2019 2020 2021 2022
23,934$ 27,428$ 27,053$ 32,910$ 29,810$ 27,035$ 53,783 64,245 62,965 76,176 78,689 64,172 4,425 5,088 5,214 5,734 5,947 5,839 18,456 18,952 19,108 17,499 18,389 16,553 1,438 1,561 1,464 1,396 1,547 1,589 4,998 5,096 4,552 4,802 4,958 4,780 5,184 5,677 5,684 6,268 5,250 5,090 4,271 3,099 3,235 2,950 2,595 3,595 1,861 5,628 2,367 2,190 2,161 2,295 6,989 9,590 8,235 9,352 10,521 9,248 8,434 8,721 10,812 9,914 9,360 7,595 1,212 1,133 1,049 1,112 1,083 1,058 134,985 156,218 151,738 170,303 170,310 148,849 31,109 35,410 34,062 37,937 36,220 35,862 8,709 9,671 9,554 9,509 8,984 10,424 - - - - - - 30,390 33,130 34,218 37,038 39,631 43,524 1,479 1,589 1,763
70,208 78,211 77,834 85,963 86,424 91,573 205,193 234,429 229,572 256,266 256,734 240,422 1,347 1,830 1,329 698 596 740 3,150 3,599 3,293 3,470 3,058 2,889 1,356 1,355 1,350 1,352 1,356 1,365 394 406 450 362 272 429 - - - - - - 401 - 510 508 230 444 1,015 1,145 1,446 761 682 968 108 - - - - - 1,265 834 678 776 754 577 2,031 3,605 4,360 3,275 4,252 4,118 3,555 3,730 3,646 3,256 3,456 1,806 14,868 14,771 21,660 22,125 49,746 49,242 497 2,329 3,739 3,036 1,906 3,442 29,987 33,604 42,461 39,619 66,308 66,020 32,130 35,595 36,966 38,575 42,246 43,256 12,939 12,837 14,002 14,413 13,959 15,966 - - - - - - - - - 1,243 1,837 1,744 31,379 31,461 34,417 37,376 41,155 43,400 - - - - - - 76,448 79,893 85,385 91,607 99,197 104,366 106,435 113,497 127,846 131,226 165,505 170,386 (104,998) (122,614) (109,277) (130,684) (104,002) (82,829) 6,240 1,682 7,551 5,644 12,773 12,793 (98,758)$ (120,932)$ (101,726)$ (125,040)$ (91,229)$ (70,036)$ (Continued)
Fiscal Year
149
SCHEDULE II
CITY OF GARDEN GROVE
CHANGES IN NET POSITION (Continued)
LAST TEN FISCAL YEARS
(Accrual Basis of Accounting)
(In Thousands)
2013 2014 2015 2016
General revenues and other changes in net position:
Governmental activities:
Taxes:
Sales taxes 19,805$ 20,285$ 19,251$ 22,052$
Property taxes 35,145 35,286 36,972 40,574 Transient occupancy taxes 14,448 16,443 17,217 20,897 Other taxes 7,316 7,438 7,761 8,214 Motor vehicle taxes, levied
for general purposes 90 75 72 71 Investment income 1,757 1,945 2,005 3,344 Other general revenues 1,210 297 534 7,270 Gain/(Loss) on sale of capital assets - (1,002) 5 3 5 2,774 Transfers - - (7) - Capital Contribution 2,309 4 - - - Special Item - - - - Total governmental activities 82,080 80,767 83,808 105,196 Business-type activities:
Investment income 437 715 523 428 Gain/(Loss) on sale of capital assets - 41 169 59 Other general revenues - 169 29 159 Discontinued operations - - - - Transfers - - 7 - Total business-type activities 437 925 728 646 Total primary government 82,517 81,692 84,536 105,842 Changes in net position
Governmental activities (3,502) (4,697) (9,276) 21,432 Business-type activities 11,315 14,476 7,856 1,849 Total primary government 7,813$ 9,779$ (1,420)$ 23,281$ 1 2
3 4
5 FY12-13: The $2.3 million capital contribution was related to the transfer of land from the Successor Agency Trust fund to the General fund.
FY13-14: The $1.0 million loss in governmental activities represents a one-time loss due to the disposal of land.
Source: Finance Department, City of Garden Grove
The City of Garden Grove implemented GASB 63 and GASB 65 for the fiscal year ended June 30, 2013.
Fiscal Year
FY11-12: The $18.9 million loss in governmental activities represents a one-time loss as a result of the dissolution of Redevelopment Agency in 2012.
FY11-12: The $2.9 million loss in business-type activities represents a one-time loss due to the transfer of the remaining net position of RV Park enterprise fund to the Successor Agency Trust fund.
FY11-12: The $20.4 million was primarily related to the $19.6 million transfer from the Mobile Home Park enterprise fund to the General fund as a result of the discontinuance of operations of the Mobile Home Park fund.
150
2017 2018 2019 2020 2021 2022
21,793$ 20,737$ 24,612$ 43,122$ 49,305$ 59,703$ 42,113 47,033 49,356 50,765 55,004 59,509 25,121 25,983 26,285 18,277 7,136 24,509 8,314 8,660 8,350 8,010 5,866 8,027 79 93 85 139 128 199 1,337 1,870 7,666 9,067 1,739 (8,007) 488 622 766 1,672 233 242 - - - - - - 292 581 1,000 50 178 39 - - - - - - - 30,058 - - - - 99,537 135,637 118,120 131,102 119,589 144,221 142 410 1,917 2,658 253 (3,072) - - - - - - 182 208 191 204 810 - - - - - - - (292) (581) (1,000) (50) (178) (39) 32 37 1,108 2,812 885 (3,111) 99,569 135,674 119,228 133,914 120,474 141,110 (5,461) 13,023 8,843 418 15,589 61,392 6,272 1,719 8,659 8,456 13,657 9,682 811$ 14,742 17,502 8,874$ 29,246$ 71,074$ Fiscal Year
151
SCHEDULE III
CITY OF GARDEN GROVE
BALANCE OF GOVERNMENTAL FUNDS
THE LAST TEN FISCAL YEARS
(Modified Accrual Basis of Accounting)
(In Thousands)
2013 2014 2015 2016
General fund:
Reserved -$ -$ -$ -$ Non-Spendable:
Agency reimbursement agreement - - - - COP reimbursement agreement - - - - Intercity loan 13,375 13,375 13,375 13,375 Land held for resale - - - - Prepaid items - - - 13 Deposits - - - - Restricted:
Public safety - - - - Public right of way - - - - Community services - - - - Community planning and development - - - - Municipal support - - - - Pension Trust - - - - Committed:
Post-Employment Benefits - - - - Community planning and development - - - - Stability reserve - - - - Assigned:
Post-Employment Benefits 1,000 1,000 1,000 1,000 Garden Grove tourism improvement 139 231 231 314 Property tax lawsuit 500 500 500 500 Building improvements 1,300 1,300 1,300 1,300 General Plan 132 223 273 239 Paramedic Tax - - - - Other purposes - - - - Unreserved - - - - Unassigned 16,016 16,217 16,330 18,331 Total general fund 32,462$ 32,846$ 33,009$ 35,072$ All other governmental funds:
Reserved -$ -$ -$ -$ Non-Spendable:
Intercity loan - - - - Land held for resale - - - - Prepaid items - - - - Deposits - - - - Restricted:
Fire - - - -
Police 2,793 2,814 1,754 9,260 Public right of way 8,433 3,665 5,358 7,639 Drainage 453 569 647 754 Community services 650 - 180 196 Community planning and development 12,200 12,695 10,385 16,712 Municipal support 242 304 - 755 Committed:
Community planning and development - - - - Assigned:
Post-Employment Benefits - - - - Property tax lawsuit - - - - Building improvements - - - - Other purposes - - - - Unreserved, reported in:
Special revenue funds - - - - Debt service funds - - - - Capital projects funds - - - - Unassigned (67) (551) (755) (4) Total all other governmental funds 24,704$ 19,496$ 17,569$ 35,312$ Source: Finance Department, City of Garden Grove
The City of Garden Grove implemented GASB 54 for the fiscal year ended June 30, 2011.
Fiscal Year
152
2017 2018 2019 2020 2021 2022
-$ -$ -$ -$ -$ -$ - - - - - - - - - - - - 13,414 13,456 12,793 12,102 8,873 8,197 - - - 2,300 2,300 2,300 10 17 21 40 90 85 - - - - - - 103 84 90 90 90 90 - - - - - - 161 166 177 177 177 177 7 2,764 3,469 4,039 4,039 4,261 15 35 57 57 48 48 - - - 662 1,635 1,635 - - - - - - - - - - - - - - - 22,500 22,500 22,500 1,000 1,000 1,000 1,000 1,000 1,000 404 - - - - - 500 500 500 500 - - 1,300 1,300 1,300 1,300 1,300 1,300 325 301 262 357 428 428 - 617 - - - - - - - - - - - - - - - - 22,629 29,428 47,448 37,206 69,951 120,244 39,868$ 49,668$ 67,117$ 82,330$ 112,431$ 162,265$ -$ -$ -$ -$ -$ -$ - - - - - - - - - - 519 - - - - 195 238 31 - - - - - - - - - - - - 9,521 5,336 3,210 4,103 4,064 3,682 8,434 9,021 11,502 10,355 12,195 12,347 529 412 273 76 129 107 945 2,370 4,505 5,841 6,401 8,166 18,080 48,376 48,098 44,971 45,947 47,945 - - - - - 1,264 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 466 - (40) (59) (18) (4) 37,975$ 65,515$ 67,548$ 65,482$ 69,475$ 73,538$ Fiscal Year
153